Sitting of 4 April 1957

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  BARCLAYS BANK D.C.O. BILL

    CATTEDOWN WHARVES BILL
    CITY OF LONDON (VARIOUS POWERS) BILL
    MARINE SOCIETY BILL
    Read the Third time and passed.

  SUNDERLAND CORPORATION BILL
  Queen's Consent, on behalf of the Crown, signified.
  Bill read the Third time and passed.

ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    Entertainments Duty (Closed Cinemas and Theatres)
    Mr. G. Jegerasked the Chancellor of the Exchequer (1) how many cinemas have closed since April, 1956; and how much Entertainments Duty had been paid by them in the year prior to closure;
    (2)how many theatres have closed since April, 1956; and how much Entertainments Duty had been paid by them in the year prior to closure.
    The Financial Secretary to the Treasury (Mr. J. Enoch Powell): After allowing for reopenings and seasonal closures, about 200 cinemas were closed from April, 1956, to February, 1957, inclusive, and 13 theatres were closed or converted to other uses from April to December last.
    I regret that the information requested in the second part of these Questions is not available.
    Mr. Jeger: Why is not the information available? Each theatre and cinema is
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    charged Entertainments Duty and presumably some account is kept by the Treasury of the duty collected from each establishment. Why cannot those figures be added together for the 200 cinemas and 13 theatres, and the total given to the House?
    Mr. Powell: It is not quite as simple as that. Entertainments Duty is collected partly by means of stamps which may be purchased at any post office, and it cannot be known which stamps are used in payment of the duty on any particular entertainment.

    Civil Service (Messengers and Paperkeepers)
    Mr. Liptonasked the Chancellor of the Exchequer what progress has been made in settling the wage claim of messengers and paperkeepers submitted by the Civil Service Union in July, 1956.
    Mr. Powell: An interim settlement has been offered and the union's reply to the offer is being considered.
    Mr. Lipton: Is not it deplorable that it has taken all this time, and Questions in the House, before the Treasury received a union deputation and made a miserable offer of 5s. a week to these lowest paid of our public servants? Why is the Treasury treating them in this dilatory and damnably off-hand sort of way [HON. MEMBERS: "Order."] By "damnably" I mean meriting the severest condemnation. Is the Chancellor deliberately trying to destroy the negotiating machinery?
    Mr. Powell: No, Sir. There has been no avoidable delay in this matter The offer was made before I saw a deputation last month, and a further reply was sent within three weeks of receiving that deputation.

    European Free Trade Area (Agriculture)
    Captain Duncanasked the Chancellor of the Exchequer why he agreed at the February Ministerial Council Meeting of the Organisation for European Economic Co-operation to including consideration of agriculture in the European Free Trade Area in the resolution of 13th February; and the terms of reference to the Working Party being set up to study this subject.
    The Economic Secretary to the Treasury (Mr. Nigel Birch): This Working Party was set up in consequence of the Council's decision of 13th February which drew
    "special attention to the objective of finding ways to ensure the expansion of trade in agricultural products on a non-discriminatory basis between all member countries of the Organisation."
    My right hon. Friend's agreement amounted to no more and no less than that the United Kingdom would continue to play its part in the existing activities of O.E.E.C. in this sphere.
    Captain Duncan: Is not the right hon. Gentleman aware that the Government are likely to come under suspicion if they speak with one voice in this House for the exclusion of agriculture and horticulture from the European Free Trade Area and with another when they agree to resolutions like this when they go to Paris?
    Mr. Birch: I think that the best answer to that was given by my right hon. Friend on 13th February when he said that the fact was that all countries in Europe wished to discuss agriculture and very few of them wanted to have free trade in it.
    Sir P. Agnew: Does my right hon. Friend consider that what he has said today is in conflict with the declaration which was repeated in the House only last week by his right hon. Friend the President of the Board of Trade that he would not assent to any agreement in which agriculture and horticulture were included?
    Mr. Birch: Perhaps my hon. and gallant Friend will await the answer to the next Question.
    Captain Duncanasked the Chancellor of the Exchequer whether he will give an assurance that there has been no change in Her Majesty's Government's view that agriculture and horticulture should be excluded from any proposals for a European Free Trade Area.
    Mr. Birch: There has been no change in the Government's policy. We cannot join in a Free Trade Area which includes agriculture and horticulture.
    Mr. T. Williams: How does the right hon. Gentleman square that with his previous answer that the Government are
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    willing to discuss agriculture because all other countries are anxious to do so?
    Mr. Birch: We have made our position perfectly clear throughout. There is no harm in discussing agriculture.
    Mr. Osborne: Is my right hon. Friend aware that certain European leaders have said that the scheme is no use to them unless agriculture is included? Will he stop deceiving those countries into the belief that we can take part in it?
    Mr. Birch: This matter is now under negotiation. Our position on agriculture is perfectly clear, and that is the point of the Question.
    Mr. Turton: Is my right hon. Friend aware of the inconvenience that is caused by hon. Members not having available to them a copy of the Common Market Treaty? In the Library there is only one copy, in French. Can he make a translated copy available to all right hon. and hon. Members?
    Mr. Birch: I will certainly go into that. It seems very reasonable.
    Mr. Jay: When the right hon. Member says that this issue is under negotiation, does he mean that the Government may recede in certain circumstances from the policy he has just stated?
    Mr. Birch: What I meant was that the industrial Free Trade Area itself is under negotiation.

    Football Pools (Tax)
    Miss Burtonasked the Chancellor of the Exchequer whether he is aware that sports clubs and scientific research in Norway will receive E1,550,000 from profits on last year's football pools; and if he will consider making available some such amount for similar purposes in this country from the tax collected from football pools.
    Mr. Powell: No, Sir. Such procedure would be contrary to long-established financial practice.
    Miss Burton: Is the hon. Member aware that such a practice does not obtain in a good many countries in Europe, and that, for example, in Sweden, Denmark, Finland, Germany, Italy, and Switzerland, sports and recreation receive money from the football pools? Why is he adamant on this matter?
    Mr. Powell: Because this House has long insisted that all sums received in taxation should be paid into the Consolidated Fund.

    Income Tax (Local Government Employees)
    Captain Pilkingtonasked the Chancellor of the Exchequer what arrangements he is making for the repayment of Income Tax originally paid by local government employees on incomes part of which they will refund when they transfer to the new system of pensions under the Local Government Superannuation Act, 1953.
    Mr. Powell: As a claim for repayment of tax in the circumstances referred to has been listed for hearing in the High Court, this matter is at present sub judice.

    Gross National Product
    Mr. Croninasked the Chancellor of the Exchequer if he will give an approximate figure in millions of pounds indicating by how much the gross national product would have increased in 1956 if industrial production had increased in that year to the same extent as the average increase of the preceding four years.
    Mr. Birch: In 1951 to 1955, the average increase in the gross domestic product, at 1955 factor cost, was £ 460 million a year; in the same period, industrial production increased on average by 4 per cent. a year.
    There is no fixed mathematical relation between the level of industrial production and the gross national product.
    Mr. Cronin: Is the right hon. Member aware that I was not asking for a fixed mathematical figure but for an approximate estimate? Is he not forgetting his lines—that two weeks ago he expressed complacency about the statistical information available to the Treasury? Will he accept the figure of Mr. Roy Harrod in the recent issue of the "Director" which indicates that last year there was a loss of £ 700 million gross national product as a result of the failure of production to increase? Does not that indicate that there should be an urgent change in Government monetary policy?
    Mr. Birch: I have not seen Mr. Harrod's article. I should have thought that figure much too high. It can be only an approximation. The Government's attitude is very well set out in paragraphs 78 and 79 of the Economic White Paper, which I hope the hon. Member will study.
    Mr. Cronin: Surely the right hon. Gentleman will not quarrel with Mr. Harrod's approximation. He is, after all, more a friend of the Government side of the House than a friend of ours.
    Mr. Birch: Even Homer nods, and this figure is a guess.

    Trustee and Post Office Savings Banks
    Mr. Croninasked the Chancellor of the Exchequer if he will investigate the possibilities of improving the facilities afforded to depositors by the Trustee Savings Banks and the Post Office Savings Bank, with a view to attracting greater savings.
    Mr. Powell: Yes. Sir. Special provision for the Post Office and Trustee Savings Banks was made in last year's Budget, and my right hon. Friend is continuing to give consideration to the contribution which these banks can make to the National Savings Movement.
    Mr. Cronin: While appreciating the excellent start made in the last Finance Act, may I ask the hon. Member to bear in mind that in the Scandinavian countries the equivalent institutions have a much higher proportion of the total bank deposits, and that that is primarily because they have a higher rate of interest and provide better services in the way of cheque clearing facilities? Will he investigate the possibility of making similar innovations in this country?
    Mr. Powell: The Trustee Savings Banks in this country have always been quite firm that they desire no increase in the rates of interest.

    Tate Gallery (Pictures)
    Mr. Hector Hughesasked the Secretary to the Treasury if he is aware that of the 4,000 pictures approximately in the Tate Gallery only about 1,200 were on exhibition on 31st July last, because there was not enough space to exhibit

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    the other 2,800; if he will now state whether space has since been found to exhibit the latter; and what are his plans for relieving the Tate Gallery of this problem and for enabling the public to see all the pictures there which were acquired for the purpose of public exhibition.
    Mr. Powell: In addition to some 1,200 pictures on the walls of the Tate Gallery, about 270 are on view in other galleries and exhibitions on loan; the remainder can be viewed on application. The same pictures do not always remain on exhibition; it is the Gallery's policy to provide a range of exhibits which changes from time to time.
    Mr. Hughes: Is the Minister aware that large numbers of these pictures remain unexhibited for long periods and that this matter of non-exhibition goes to the very root of the trust upon which the pictures are held? When, as in this case, there is accommodation elsewhere for the pictures, does he not realise that it should be used? Does the Minister realise that I am referring in particular to the Lane pictures, which should go to Dublin?
    Mr. Powell: I thought that the hon. Member might have something of that kind in mind, but it will be obvious that, if the pictures on exhibition in the Tate Gallery are to be varied from time to time, the total number owned must be considerably in excess of the number exhibited.

  AGRICULTURE, FISHERIES AND FOOD

    Sea Water (Radioactivity)
    Mr. Hector Hughesasked the Minister of Agriculture, Fisheries and Food if he will make a comprehensive statement on the results recorded in relation to the effect of nuclear tests on the radioactivity of fish, seaweeds and marine foods by the Food and Agriculture Organisation meeting on oceanography, at which this country was represented, held last January in Gothenburg, Sweden.
    The Minister of Agriculture, Fisheries and Food (Mr. Derick Heathcoat Amory): My Department was not represented at the Gothenburg meeting, which
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    was sponsored by U.N.E.S.C.O. and not by the Food and Agriculture Organisation, and I cannot add to the reply given to the hon. and learned Member on 1st April.
    Mr. Hughes: Does the Minister not realise that this matter is imminent and urgent in relation to the food supply of this country and that he must take serious notice of it and deal with it in the interests of the people of this country?
    Mr. Amory: It is an important subject, but I would remind the hon. and learned Member that Questions concerning physical oceanography should be addressed to my right hon. Friend the First Lord of the Admiralty and Questions concerning general radiation hazards to my noble Friend the Lord President of the Council.

    Agricultural Land and Output
    Mr. Osborneasked the Minister of Agriculture, Fisheries and Food how many acres he estimates have been lost to agriculture since 1945 through the building of houses, schools, factories, etc.; and what is the approximate increase in production per acre since 1945.
    Mr. Amory: Precise figures for the loss of agricultural land in England and Wales are not available. The Agricultural Returns, which exclude holdings of one acre or less and those parts of agricultural holdings not used for agricultural production, suggest that the net loss of agricultural land in England and Wales to building has been 327,000 acres between June, 1945, and June, 1955.
    The volume of agricultural net output per acre of the total agricultural area in the United Kingdom is estimated to have risen by 20 per cent. over the same period.
    Mr. Osborne: May I ask my right hon. Friend whether he will use all the power he can to prevent good agricultural land from being gobbled up at this rate, since such land is obviously limited and one day we may need it for the growing of food instead of for other purposes?
    Mr. Amory: If by "gobbled up" my hon. Friend means used for some purpose other than agriculture, what he asks will continue to be my aim and intention.
    Mr. T. Williams: Has the Minister a vague estimate of what area of land has been reclaimed within these two dates?
    Mr. Amory: I have, but I cannot give the figure from memory. If the right hon. Gentleman puts down a Question, I think I can give him the answer.
    Mr. Crouch: Is my right hon. Friend aware that by the use of modern methods, better grass seeds, more fertilisers and better cultivation we can increase the area of fertile land by bringing back land which has been out of cultivation for a long period? Does he not think that that will replace sonic of the fertile land lost to agriculture?
    Mr. Amory: Yes, I do. I thoroughly agree with my hon. Friend that most amazing results can be, and I am glad to say are being, achieved in many cases. I hope and believe that that kind of progress will more than make good any loss of land which we may have to suffer for other purposes.

    Tinned Milk (Retail Sales)
    Mr. Doddsasked the Minister of Agriculture, Fisheries and Food if he is aware that tins of milk produced some considerable time ago and disposed of by his Department on condition that they were not for retail sale are being offered for sale in private trade shops at cut prices and bearing the name "Wheatsheaf Full Cream Milk "; and what action he proposes to take to deal with this unsatisfactory situation.
    Mr. Sydney Irvingasked the Minister of Agriculture, Fisheries and Food what steps he has taken to ensure that the undertaking given by certain firms not to offer for sale in retail shops tins of Wheatsheaf and other full cream milks, purchased by them from his Department as surplus because of their doubtful age, has been carried out; if he is aware that such tins have been on sale recently in private traders' shops in Dartford and elsewhere at cut prices and without any indication of age or origin; and what further steps he proposes to take to remedy this state of affairs.
    Mr. Amory: I am having inquiries made and shall consider what action if any I can take when they are completed.
    Mr. Dodds: Does the right hon. Gentleman recollect that on 5th March
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    last year there was a row in the House about this same sort of business, when he admitted that quantities of canned milk sold for animal feeding stuffs to a number of buyers and others had gone into shops and was being sold retail? Now, a year later this milk is still on sale in the shops. One of my hon. Friends asks, "What about a prosecution?" Is it not sharp practice that housewives should be buying this tinned milk, not knowing that it was produced anything from five to eight years ago? What will the right hon. Gentleman do about that?
    Mr. Amory: The hon. Member reminded me of a row. I cannot remember that particular one, but there have been several between then and now. Of course, this full-cream, unsweetened, evaporated milk was sold by my Department a considerable time ago—
    Mr. Dodds: For animals.
    Mr. Amory: —for other than human consumption. I do not think that I can add anything to the reply which I have already given to the hon. Gentleman. He will see from that that I am actively considering what action I can take.
    Mr. Irving: Is the Minister aware that one of the firms involved is Messrs. Mence Smith? I understand that there are other firms. Will he consider listing in HANSARD the firms involved in order to protect the public from this abuse?
    Mr. Amory: I will take note of what the hon. Gentleman has said, but I do not know what firms were concerned in this matter.
    Mr. Willey: I may well have taken part in the earlier row a good deal of time has passed. Will the right hon. Gentleman do his best as early as possible to allay public anxiety about this question?
    Mr. Amory: I remind the hon. Gentleman that in the case of any food which is unfit for human consumption the local health authorities have the duty of seizing the food and of prosecuting.

    Eggs
    Mr. Doddsasked the Minister of Agriculture, Fisheries and Food what quantity of eggs has been exported to European countries since 1st February up.

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    to the latest convenient date; and the future prospects in this respect.
    Mr. Amory: 4,783 boxes of eggs were exported to the Continent in February. Information about exports in March is not yet available. Future prospects will depend upon the relationship between market prices in this country and on the Continent which I cannot predict.
    Mr. Dodds: I am not raising this as a complaint, but is the right hon. Gentleman aware that there is a good deal of interest in these transactions, primarily because the taxpayer is spending a good deal of money subsidising the eggs being exported? If there is some justification, will he take an opportunity to explain what we are getting out of these transactions?
    Mr. Amory: I am aware of the matter. We must keep it in perspective; in February, 4,783 boxes were exported. while in the same month we imported 8,000 boxes and the through-put of the packing stations was 1,750,000 boxes, so that the proportion at present is very low indeed.
    Mr. Willeyasked the Minister of Agriculture, Fisheries and Food the estimated amount of the subsidy paid on eggs exported to the Channel Islands during 1956– 57.
    Mr. Amory: The best estimate that I can make of subsidy incurred on eggs sent to packing stations in this country and ultimately exported to the Channel Islands during the financial year 1956– 57 is about £ 50,000.
    Mr. Willey: Is the right hon. Gentleman aware that I have an estimate for the Channel Islands which puts the figure at £ 1 million? It is upsetting poultry keepers in the Channel Islands. In any case, it seems absurd that we should subsidise eggs for the Channel Islands, where they enjoy Income Tax at 4s. in the £, no death duties and no Purchase Tax.
    Mr. Amory: The figure that the hon. Member mentions would be upsetting to me, too. This trade has been a small but regular one, and at present I see no reason to discourage it.
    Mr. Willey: Is the right hon. Gentleman aware that it is sufficient to upset
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    the poultry keepers in the Channel Islands?
    Mr. Amory: I should not have suspected that the figures that I have quoted would be sufficient for that purpose. I would add that no representations have been made to me from the Channel Islands.
    Mr. Wiley: I will ask for the representations to be transferred to the right hon. Gentleman.

    North Sea Herring Fishing (London Conference)
    Mr. Edward Evansasked the Minister of Agriculture, Fisheries and Food if he will make a statement on the conservation of the herring fisheries in the North Sea.
    Mr. Amory: At the invitation of Her Majesty's Government, an informal Conference of the seven countries which fish for herring in the southern North Sea was held in London three weeks ago to consider this question. The representatives of all countries agreed to ask their Governments to examine urgently with their fishing industries and their scientists what measures might be taken, in the form of a voluntary agreement, to increase the survival of adult herring. particularly on the spawning grounds, in the southern North Sea.
    Consideration will be given to a proposal made by the United Kingdom representatives that in the common interest the major spawning ground in the Channel should be closed to fishing during November and December when the herring are gathered there to spawn. Copies of the resolution adopted by the Conference are available in the Library.
    Mr. Evans: Is the right hon. Gentleman aware that that statement will be very warmly received in those circles which are interested in the herring industry? Can I urge him to keep these matters very much in mind and to see whether we can do something to stop this slaughter of the innocents?
    Mr. Amory: I agree that it is a very important question.
    Mr. G. R. Howard: Which countries were represented? Can my right hon.

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    Friend say whether discussions took place about regulating the size of mesh and nets at the same time?
    Mr. Amory: The conference was attended by representatives from Belgium, Denmark, the Federal Republic of Germany, France, The Netherlands, Poland, and the United Kingdom.
    Mr. T. Williams: Will anyone undertake police measures during the period referred to?
    Mr. Amory: The difficulty at present is that herring do not come under the International Convention. We should like to see herring brought under the Convention, and we have made suggestions to that effect, but in the meantime the countries concerned must depend on voluntary ad hoc arrangements.

    Pilchard Prices
    Mr. Haymanasked the Minister of Agriculture, Fisheries and Food whether, in conjunction with the White Fish Authority, he will consider the introduction of a scheme for securing reasonable prices for pilchards between fishermen and buyers on first-hand sales to canners, curers and the fresh market.
    Mr. Amory: This is a matter in the first instance for the White Fish Authority, which is now considering whether and how it might assist in response to a recent request by the Cornwall Sea Fisheries Committee.
    Mr. Hayman: While thanking the Minister for that reply, may I ask him if he will give all the assistance he can to the Cornish pilchard industry, because this is a very important industry, although very small, and it is facing terrific competition in the imports of a kind of pilchard from all parts of the world?
    Mr. Amory: I can assure the hon. Member that I shall give very careful consideration to any recommendations or proposals made to me by the White Fish Authority.

    Potatoes
    Mr. Osborneasked the Minister of Agriculture, Fisheries and Food (1) if he is aware that, since the demand for potatoes as cattle food will taper off by the end of March, there are large supplies of surplus potatoes; and if he will give instructions for the more
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    rapid processing of potatoes in order to prevent them from rotting and being a complete loss to the taxpayer;
    (2) how many tons of potatoes have been offered to the Potato Marketing Board this year which, so far, the Board have been unable to dispose of; and if he will make a statement on the position.
    Mr. Amory: Up to 27th March, approximately 1,500,000 tons of potatoes have been offered to the Potato Marketing Board. Of these just over 1 million tons have already been put under contract, and 300,000 tons have been disposed of by the Board. The surplus for the year as a whole is likely to be about 750,000 tons. Sales of surplus potatoes for stockfeed are expected to be well maintained for a month or two after the end of March. Substantial sales have been made for export for processing for purposes other than human consumption. Similar processing of surplus potatoes is being carried out in this country on the largest practicable scale.
    Mr. Osborne: Is my right hon. Friend aware that many farmers would like to get the potatoes moved from their farms so that they can use the space, especially those farmers with premises full of them? Can he do anything to help from that angle? Secondly, is he using all the beet-sugar factories which could be used, or is it true that some are still closed which might be used? Can he do anything about that?
    Mr. Amory: A very large quantity of potatoes were declared during March. After they have been offered, they have to be inspected, and that is taking a little time, but I am sure that the Potato Marketing Board will do everything it can to see that they are moved as soon as possible. All the accommodation that the British Sugar Corporation can offer for this purpose is being used, or is to be used. If the British Sugar Corporation can make additional resources available, I am sure that it will.
    Mr. Emrys Hughes: In view of the very heavy losses sustained by the farmers in the West of Scotland as a result of Government policy last year, and as the Minister wishes to be really helpful, will he consider making a definite statement that he will do everything possible to prevent Ayrshire farmers from suffering similar losses this year?
    Mr. Amory: This is the second time today that the hon. Member has called my attention to this problem. I think I will give him a general assurance that it is my wish to be as helpful as I can possibly be to farmers in South Ayrshire, as to farmers in the rest of the country.
    Major Legge-Bourke: Will my right hon. Friend bear in mind that the situation which he described in his original answer makes it all the more important that his Department and the Board should keep in the closest possible touch over the import situation, and make quite certain that on no account will any great import decision be taken without prior consultation with the Board?
    Mr. Amory: Yes, I think that I can give my hon. and gallant Friend that assurance, most certainly. But, of course, I do not think that there are any imports of potatoes at present, other than new potatoes.
    Mr. Wade: As regards the surplus potatoes which are exported, is the taxpayer having to meet the difference between the price paid by the Potato Marketing Board and the price received?
    Mr. Amory: Yes, that is broadly the case.
    Mr. Willeyasked the Minister of Agriculture, Fisheries and Food why the subsidy for potatoes for 1957–58 is estimated to be £6,540,000 more than was estimated for the previous year.
    Mr. Amory: Payments from the Exchequer arising from guarantees of the potato crop in Great Britain in any year are made mainly in the following financial year. The estimate to which the hon. Member refers is thus in respect of the 1956 crop, which has thrown up a heavy surplus. There was no such surplus from the 1955 crop.
    Mr. Willey: I fully appreciate the difficulties with regard to potatoes, but will the right hon. Gentleman review the position generally, because it is very upsetting to have these violent fluctuations in the amount and prices?
    Mr. Osborne: We cannot control the weather.
    Mr. Amory: In respect of potatoes, I think that fluctuations are almost inevitable
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    in the nature of the crop and its dependence upon the weather. Secondly, they are, to a lesser extent, perhaps, inevitable with a price support system as against a deficiency payments system.

    Meat Imports
    Mr. Langford-Holtasked the Minister of Agriculture, Fisheries and Food, in view of the fact that since 1951 meat imports from New Zealand have increased by only 30 per cent. whereas imports from the Argentine have increased by 328 per cent. in the same period, what action he proposes to take in this connection.
    Mr. Amory: I do not consider that the figures my hon. Friend quotes necessarily indicate a need for a change in Government policy in this field. Compared with pre-war, imports of meat from New Zealand have increased by 35 per cent. while those from the Argentine have decreased by 26 per cent.
    Mr. Langford-Holt: Is my right hon. Friend in a position to say what are the views of the New Zealand Government, and whether they have made a communication to him upon this matter? Is he further aware that everybody—including himself, I hope—would wish that the imports of New Zealand meat, so far from being ten times less than those of the Argentine, were ten times more?
    Mr. Amory: I think that I am speaking for the whole House when I say that we value very highly our present trading relations with New Zealand and are very anxious to do everything we can to see that they are not impaired in any way in the future. As regards the first part of the supplementary question, I expect quite shortly to be in possession of the New Zealand Government's views.
    Mr. T. Williams: Is it not the case that no form of restriction has been applied to imports of meat from New Zealand?
    Mr. Amory: That is absolutely correct.
    Mr. Shinwell: Perhaps the right hon. Gentleman can tell me whether I am right in thinking that New Zealand is a better customer of this country than the Argentine. If so, ought not New Zealand to receive more consideration than the Argentine?
    Mr. Amory: New Zealand is a very good customer of this country but, as the right hon. Member for Don Valley (Mr. T. Williams) has reminded the House, we give New Zealand a completely open market for meat, and it is free of any duty. Duty is applicable to many types of meat coming from other non-Commonwealth countries.

    Agriculture (Support Cost)
    Captain Duncanasked the Minister of Agriculture, Fisheries and Food the estimated total cost of the support to agriculture for 1957– 58, to compare with the figure of £ 245 million referred to in paragraph 13 of Command Paper No. 109.
    Mr. Amory: The provision which has been made in the Civil Estimates for 1957–58 just published—Class VIII Votes 2 and 12—for the support of agriculture was based on expectations at the time when the Estimates were prepared early this year, and amounts to £ 238· 3 million. Apart from the unpredictable effects of other factors, such as the level of market prices, the changes in the guarantees following the recent Annual Review for which provision had not been made would be likely to increase the cost by about £ 10 million during the financial year.
    Captain Duncan: I thank my right hon. Friend for those figures, but does he realise how difficult it is to get figures from the Estimates? We are given the figure of £ 245 million in the Annual Review White Paper, but it is almost impossible to dig it out of the Estimates, because it is in the English, Scottish and Northern Irish figures.
    Mr. Amory: I know very well the difficulty of digging things out of the annual Estimates.

    Sausages
    Lieut.-Colonel Bromley-Davenportasked the Minister of Agriculture, Fisheries and Food the present instructions to food and drug inspectors with regard to the contents of sausages; whether public analysts, to whom are submitted samples of sausages, are requested, in addition to ascertaining the amount of protein in the sausage, to establish completely the identity of the other ingredients, with a view to ascertaining whether any of the materials
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    banned by Section 5 of the Meat Producers (No. 3) Order, 1925, Statutory Rule and Order No. 2257, are contained therein; and whether he proposes to issue new instructions in view of the increasing use of the emulsifying and grinding machinery for making up sausages.
    Mr. Amory: Responsibility for enforcement rests with local authorities and I have no power to give instructions to their inspectors. It is, however, the duty of public analysts to test samples for the presence of all prohibited ingredients, and I have no doubt that the possible consequences of the use of emulsifying and grinding machinery are already familiar to them.
    Lieut.-Colonel Bromley-Davenport: Has my right hon. Friend, or have his advisers, read the journal called "Meat Marketing" of 23rd March this year, in which there is an illustration of a vibration colloid mill which, by grinding, emulsifying and homogenizing,
    " permits the economic usage of such products as rinds, sinews, cartilages, paunches, greaves, ears and udders"
    and is he aware that it is further stated that the mass paste produced can be used in sausage manufacture?
    Mr. Amory: The problem which my hon. and gallant Friend outlines sounds a most comprehensive one. I shall look forward to further technical elucidation from him.

    Heavy Horses
    Lieut.-Colonel Bromley-Davenportasked the Minister of Agriculture, Fisheries and Food the present number of heavy horses in use on farms in this country; what is the present position with regard to the existing and potential export trade in heavy horses; and his estimate of the amount of oil fuel and capital equipment saved by using heavy horses on farms in this country.
    Mr. Amory: The total number of horses being used for agricultural purposes in England and Wales on 4th June, 1956, was 104,973, but I cannot say how many of these were heavy horses. The export trade in heavy horses is negligible and there is no likelihood of an increase. I am unable to provide the estimate asked for in the third part of the Question because the great differences in the sizes

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    and types of farms in this country and the wide range of tractors now available would introduce too many variables into the calculation.
    Lieut.-Colonel Bromley-Davenport: Is it not tragic to allow the heavy horse population of this country to decline merely because my right hon. Friend's Department or the Treasury wish to economise to the extent of something under £1,000 a year?
    Mr. Amory: The governing factor in this situation is one of economics and not the attitude of the Treasury.

    Bacon Prices
    Lieut.-Colonel Bromley-Davenportasked the Minister of Agriculture, Fisheries and Food whether he is aware that since the abolition of import quota restrictions on bacon the price of English bacon has fallen during the past two months by 81s. per cwt. which is equivalent to £4per pig; and whether, in view of the consequentially increased cost of subsidising pig production in this country and the danger that a continuation of such low prices may force exporting countries to reduce the level of their bacon herds and so eventually bring about a shortage of bacon, he will consult with the exporting countries as to whether they will reconsider the introduction of quota restrictions by Great Britain,
    Mr. Amory: No, Sir. The recent decline in bacon prices must be considered in relation to their previous rise after Christmas to the highest level they have ever reached, despite their normal tendency to fall at that time of year.
    Lieut.-Colonel Bromley-Davenport: Is it not difficult for any pig producer—either in this country or abroad—who is supplying us to plan ahead intelligently under these conditions?
    Mr. Amory: I do not think so, because there is a guaranteed price, which is there for the purpose of providing him with a safeguard to enable him to plan ahead.

  EMPLOYMENT

    Manufacturing Industries (Earnings)
    Mr. Croninasked the Minister of Labour the percentage increase in hourly earning rates in British manufacturing
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    industry between October, 1955, and October, 1956.
    The Parliamentary Secretary to the Ministry of Labour and National Service (Mr. Robert Carr): The percentage increase in the average hourly earnings in the manufacturing industries between October, 1955, and October, 1956, was 7·9.
    Mr. Cronin: Is the hon. Member aware that that figure is one of the lowest figures of the major industrial countries of Western Europe? If he refers to the latest O.E.E.C. statistical bulletin he will see that the figure for Belgium is 14 per cent. and for Germany and France, 9 per cent. Bearing in mind the relatively more powerful position of British trade unions, will he take this opportunity of expressing his appreciation of their moderation?
    Mr. Carr: I think that I should be unwise if I were at this time to follow the hon. Member's suggestion. It should be borne in mind that while earnings were rising by that amount the cost of living rose by a much smaller amount.
    Captain Pilkington: Can the Minister give the productivity figures for the same period?
    Mr. Carr: Not without notice.
    Mr. Isaacs: Can the Minister inform the House whether the hourly earning rates to which he refers are for the standard week and number of hours, or do the figures quoted relate to the number of hours of work and extra hours with overtime?
    Mr. Carr: I was asked about earnings, and the figures which I gave referred to earnings. The average number of hours worked in that year actually fell slightly between the two Octobers.
    Mr. Isaacs: Do the figures include overtime payment?
    Mr. Carr: They include overtime payment, but to a lesser extent than the year before.

    Stroud and Dursley
    Mr. Kershawasked the Minister of Labour what was the number of unemployed persons in the Stroud and Dursley areas in the months of January and February, 1957; and what percentage of the total working population in those areas those figures represent.
    Mr. Carr: At Stroud employment exchange the number of persons registered as unemployed on 14th January was 212, or 1·1 per cent. of the estimated total number of employees in the area, and 137 or 0·7 per cent, on 11th February. At Dursley employment exchange the numbers unemployed were 46 or 0·6 per cent. in January, and 37 or 0·5 per cent, in February.
    Mr. Kershaw: Are not these figures very satisfactory, and are not they further proof, if proof be needed, of the excellent policies of the Tory Government?
    Mr. Carr: I would certainly regard these figures as satisfactory, and I am very glad to accept the compliment.

  HOME DEPARTMENT

    Air Raid Shelter, Madeley Heath
    Mr. Swinglerasked the Secretary of State for the Home Department if he will now approve the removal of the air raid shelter at the rear of Wharf Terrace, Madeley Heath, in the rural district of Newcastle-under-Lyme, in view of the fact that it constitutes a danger to children at play and obscures the light from the houses.
    The Secretary of State for the Home Department and Lord Privy Seal (Mr. R. A. Butler): I am informed that this shelter stands on the edge of a large open space and is 12 feet beyond the boundary wall of the house and 35 feet from the living room windows. I therefore regret that I can find no sufficient grounds for the removal of the shelter for the reasons suggested.
    Mr. Swingler: Are not such unsightly objects likely to become extremely insanitary and neglected, and present a temptation to children playing behind the houses, and is it not likely that accidents may occur? Should not all these important factors be taken into account, and what is the purpose of retaining this shelter?
    Mr. Butler: So far as we can, and so long as shelters do not offend for the reasons given by the hon. Member, we try to keep them. I have consulted the Newcastle-under-Lyme Rural District Council. which does not consider the
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    shelter dangerous to children. Under the circumstances, I think it better to keep the shelter where it is.

    Preventive Detention Reports (Interviews)
    Mr. Swinglerasked the Secretary of State for the Home Department if he will issue instructions to ensure that prisoners who are interviewed for the purpose of compiling preventive detention reports by the Prison Commissioners are warned beforehand of the purpose of the interview and of the fact that the information given may be published.
    Mr. R. A. Butler: The hon. Member has raised an extremely difficult problem, which arises also in connection with the reports made on prisoners eligible for corrective training or Borstal training. It is important, and in the best interests of the prisoner, that the court should have the fullest information about his circumstances, including, in some cases, his domestic circumstances, because they may be relevant to the sentence.
    I am anxious, while being fair to the prisoner, not to discourage him from giving the interviewing officer all relevant information. I am not, therefore, convinced that the hon. Member's suggestion is the right answer, but I am studying most carefully the problem to which he has drawn attention.
    Mr. Swingler: Is the right hon. Gentleman aware that cases have occurred in which defamatory statements have been made in preventive detention reports to the courts, and that there have been very serious repercussions on third parties who have no remedy, because of the privileged character of these reports? Would the right hon. Gentleman therefore study the possibility of devising some means whereby at any rate defamatory statements should be excluded from the reports when they are to be published?
    Mr. Butler: Yes, Sir, that is why I gave the hon. Member so careful a reply. I should like to look into the case and the point he has raised. The first thing is that the courts must have full information. The second thing is that the interests of third parties ought not to be damaged. The third is that the courts should be left the discretion to make known the content of the Prison Commissioners'

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    report, if they think it necessary to do so. In the light of the case which has been put by the hon. Member, I am reexamining the whole problem.

    Justices of the Peace (Expenses)
    Mr. Blytonasked the Secretary of State for the Home Department if he is prepared to bring in legislation to provide expenses and loss of wages for magistrates attending the quarter sessions.
    Mr. R. A. Butler: Justices who necessarily incur expense in the performance of their duties are already entitled to a travelling allowance, and if they have to be away from home for a night they can also claim a lodging allowance. The Royal Commission on Justices of the Peace, which reported in 1948, considered proposals that justices should be paid an allowance for loss of time and recommended that they should not. This conclusion was accepted by Parliament when the Justices of the Peace Act was passed in 1949 and I still think that it was the right conclusion.
    Mr. Blyton: Is the right hon. Gentleman aware that magistrates in the County of Durham who attend the quarter sessions do not receive out-of-pocket expenses, nor are they paid for loss of earnings? Is he aware that that is causing hardship to magistrates who arc working-class people?
    Mr. Butler: The difficulty is that the Royal Commission recommended against subsistence allowances, although there are travelling and lodging allowances. As at present advised, I cannot go further than the Report of the Royal Commission. If the hon. Member would like to draw particular cases to my attention, I shall be glad to consider them.

  EDUCATION

    Roman Catholic Children, Forest Hall and Longbenton
    Mr. McKayasked the Parliamentary Secretary to the Ministry of Education if he is aware of the shortage of school accommodation for the Catholic children in the Forest Hall and Longbenton area; and if he will allow some form of temporary accommodation to be built to meet the need pending the erection of a new school.
    The Parliamentary Secretary to the Ministry of Education (Sir Edward Boyle): It is planned to start work on the building of a new Roman Catholic secondary school this year and of a new primary school next year. In these circumstances, my noble Friend would not feel justified in approving further temporary building at the existing Roman Catholic School. I am writing to the hon. Member to explain the position more fully.
    Mr. McKay: Is not the Minister aware that it is likely to be two years before these children get the accommodation? Is it not correct that in this case it is not a question of building anything because there is a new building already in existence which will be ready at Easter? Is he aware that if he cannot allow that building to be used temporarily, it would appear that Catholic people are not being treated in a fair and reasonable way? Will the hon. Gentleman consider the matter again?
    Sir E. Boyle: I know the interest taken in this matter by the hon. Member, and by his hon. Friend who represents one of the Newcastle divisions. I am writing to the hon. Member and dealing fully with the suggestion that the parish hall should be used temporarily for teaching purposes. I will try to explain the position as fully as I can.

    11-Plus Examination
    Mr. Awberyasked the Parliamentary Secretary to the Ministry of Education if he is aware of the effects on the health of school children of the strain in anticipation of the 11-plus examination; and if he will hold an inquiry into this method of judging the qualifications of a child to ascertain if a method can be devised to measure the capabilities of children that will not affect their health.
    Sir E. Boyle: A formal written examination is only one of the methods used by local education authorities for selecting children for secondary education, and a great deal of research and experiment is going on in this field. My noble Friend therefore sees no need for a special inquiry on the lines suggested in the question.
    Mr. Awbery: Is the Parliamentary Secretary aware that there is a feeling

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    of apprehension among parents regarding the effect of these examinations on the health of the children? Is he aware that it is affecting the health of the mothers as well, because they feel that the destinies and careers of their children are being determined by these examinations? Is he aware that some local authorities have already adopted another method of determining the capacity of the children, and will he give further consideration to this matter?
    Sir E. Boyle: We are debating this very important matter tomorrow. As the hon. Member probably knows, intensive research on methods of selection is being undertaken by the National Foundation for Educational Research, and of course local education authorities keep their own methods of selection under careful review in the light of their experience and new knowledge on this subject.

  TRADE WITH CHINA
  Mr. Swinglerasked the Prime Minister what discussions he had with President Eisenhower on the subject of trade with China; and what decisions were reached.
  The Prime Minister (Mr. Harold Macmillan): I would refer the hon. Gentleman to the reply I gave on Tuesday.
  Mr. Swingler: May I ask the Prime Minister whether he will be good enough to amplify that statement? Is he aware that there has been a very long delay in considering this question of relaxing the embargo on trade with China; that it is a matter of years and not months? Will the right hon. Gentleman say whether he will fix a time limit to the discussions, after which he will take action in the interests of British firms?
  The Prime Minister: No, Sir. As the hon. Gentleman says, it has been a very long problem. That is why I said I hope to make a statement shortly.
  Sir T. Moore: Apart from our natural desire to work closely with the United States, may I ask my right hon. Friend whether it would be helpful to the prosperity of our country if the area of trade with China were widened, especially as it involves 600 million possible buyers?
  The Prime Minister: For that reason I hope to be able to make a statement shortly.

  TREATIES (ANTI SUBVERSION ACTIVITIES)
  Mr. Zilliacusasked the Prime Minister whether he considered with President Eisenhower the anti-subversive activities of the South-East Asia Treaty Organisation discussed at Canberra, with special reference to alleged Communist infiltration into trades unions, popular fronts and political parties in South-East Asian countries; and what international measures were decided upon in pursuance of these activities.
  The Prime Minister: No, Sir. This was not among the matters considered at Bermuda.
  Mr. Zilliacus: Will the Prime Minister not bear in mind the danger that the measure referred to by Mr. Dulles at the Canberra Conference would, if participated in by Her Majesty's Government, amount to interference in the internal affairs of South-East Asian countries? Will he give an assurance that we will scrupulously observe the obligations of the Charter relating to non-interference?
  The Prime Minister: Yes, Sir; I am very happy to have that statement of policy from the hon. Gentleman. It does him credit. But I would call his attention to the communiqué which was issued at the end of the S.E.A.T.O. conference under this heading, from which he will find that the activities of S.E.A.T.O. in this sphere are confined to member countries.
  Mr. Gower: Has my right hon. Friend noted that this question appears to convey a very keen apprehension on the part of the hon. Member of the dangers of this kind of infiltration?
  Mr. Zilliacusasked the Prime Minister what agreement he reached with President Eisenhower on Anglo-American co-operation in intelligence and anti-subversion activities in the areas covered by the North Atlantic Treaty Organisation, the South-East Asia Treaty Organisation, the Bagdad Pact and the Eisenhower doctrine; to what extent these activities are supported by our common

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  anti-subversion defence obligations under these instruments; and whether he will make a statement.
  The Prime Minister: No such agreement was concluded. Her Majesty's Government naturally exchange information from time to time with other friendly Governments; this is a normal practice between Governments. They also give any assistance they can to their allies in meeting any threat of subversion. But no additional arrangements were made between Her Majesty's Government and the United States Government at Bermuda.
  Mr. Zilliacus: Is the Prime Minister aware that on 27th February the Minister of Defence stated that these obligations included the obligation to intervene by military force against any popular rising alleged by the rulers of any Bagdad Pact country to constitute Communist subversion? Will he not reconsider that obligation, which has aroused great anxiety in many quarters?
  The Prime Minister: If the hon. Gentleman will put a precise Question on the Paper I will try to answer it. His supplementary question does not seem to arise out of the Question on the Paper.
  Major Beamish: Has not the Labour Party set some healthy precedents in these matters by proscribing so many of the organisations which the hon. Member for Gorton (Mr. Zilliacus) supports?

  GERMANY (REUNIFICATION)
  Mr. Zilliacusasked the Prime Minister to what extent his and President Eisenhower's joint reference to the reunification of Germany indicates readiness to summon a new four-Power conference to negotiate an agreement for the reunification of Germany outside the rival alliances but within the United Nations and an all-European treaty based on the charter and linked with conventions for the control and reduction of armaments and withdrawal of forces from Germany, Hungary and Poland; or whether his policy remains the inclusion of united Germany in the North Atlantic Treaty Organisation.
  The Prime Minister: As the hon. Member has been told before, we are willing to negotiate with the Russians at any suitable time, provided there is a prospect of satisfactory progress. But we must maintain our insistence on free all-German elections and the freedom of an all-German Government to choose its policies. So far the Soviet Government have refused to agree to either of these things.
  As regards the second part of the Question, I would refer the hon. Member to what I said at Geneva on 29th October, 1955, namely that
  " so far as the Western Powers are concerned a reunified Germany will have complete freedom to choose whether she should join the North Atlantic Treaty Organisation or not."
  This remains the policy of Her Majesty's Government.
  Mr. Zilliacus: Is not the Prime Minister aware that there is no possibility of an agreement on that basis? Is he further aware that both the Labour Party and the German Social Democratic Party have come out for a policy of reunifying Germany within an all-Europe treaty, outside the rival alliances? Will the right hon. Gentleman explore the possibilities of a fresh approach, in order to break the deadlock?
  The Prime Minister: No, Sir, I must adhere to what I have said in the Answer to this Question.
  Mr. Gaitskell: Is there not a meeting taking place in Washington between the United States, Britain, France and West Germany on the whole question of whether a fresh initiative in relation to German reunification is possible? May I ask whether Her Majesty's Government still adhere to the so-called "Eden Plan" under which there would be a thinning out of forces on each side of the Iron Curtain?
  The Prime Minister: With regard to the first part of the question, discussions at the official level are going on, but it would not be right for me to disclose the contents of any report by officials until they have been considered by Ministers. Therefore, that covers the other part of the question also.

  OIL PIPELINES AND STORAGE DEPOTS (INTERNATIONAL CONTROL)
  Mr. Stonehouseasked the Prime Minister what are the details of the plan for the international control of oil pipelines and oil storage depots which he has sent to President Eisenhower.
  The Prime Minister: I would refer the hon. Member to my statement in the House on 1st April, in which I referred to the discussions of the problem held at Bermuda. He will recall that I said that we considered the desirability of a policy by which pipeline projects could be given additional protection by a treaty between the interested Governments. I have not, however, communicated to President Eisenhower any plan of the type mentioned by the hon. Member.
  Mr. Stonehouse: I wonder whether we might ask the Prime Minister to be more specific about the plans he has in mind; and further, whether he is not in agreement that, as increasing the supply of oil from the Middle East is of such importance to our country. we should support international control of these pipelines rather than monopoly commercial control; and is he further aware that this matter is being proposed at the twenty-fourth session of the Economic and Social Council at Geneva?
  The Prime Minister: Yes, Sir, there is a great deal of discussion going on about these possibilities, in which I know the hon. Gentleman is interested, but it would not be right for me to make any precise statement, especially as the countries concerned have to be brought into any such negotiation.

  BERMUDA (RACIAL DISCRIMINATION)
  Mr. M. Stewartasked the Prime Minister what inquiries he was able to make, during his visit to Bermuda, into racial discrimination in that Colony, in accordance with his undertaking.
  The Prime Minister: I found no evidence which would cause me to qualify what I said on 26th February, namely, that there is no right or privilege controlled by law which is not equally available to all Bermudians.
  Mr. Stewart: Would the Prime Minister say whether he was able to find out whether the facilities of the Mid-Ocean Hotel are open to all potential customers without discrimination of race?
  The Prime Minister: No, Sir, but I had the opportunity while I was in Bermuda to entertain both white and coloured guests, and I heard no complaint of any treatment which bore unjustly upon the coloured citizens of the island. The only complaint I did hear was that there was no Income Tax.
  Mr. G. R. Strauss: Is the Prime Minister aware that, although coloured guests brought by him would, of course, be accepted by the hotels of Bermuda, the normal practice for all hotels in Bermuda is to exclude coloured people, however distinguished they may be? If the right hon. Gentleman wants further confirmation, will he consult the Ministers of the Jamaican Government?
  The Prime Minister: What Ministers of Governments deal with is the law, and I repeat that there is no right or privilege controlled by law which is not open to everybody in Bermuda.
  Mr. J. Griffiths: Outside the law, would not the Prime Minister deprecate any hotel refusing hospitality to Ministers of the Commonwealth?
  The Prime Minister: That is quite another question. All I have to deal with is what Governments are responsible for, either the Government here or the popularly elected Government of Bermuda.
  Mr. J. Griffiths: Since we are increasingly granting self-government and independence to the countries of the Commonwealth, whose Ministers will be coloured, would not the Prime Minister consider it desirable to make some form of statement that we deprecate any practice of this kind?
  The Prime Minister: No, Sir—[HON. MEMBERS: "Oh."]—it is our duty as a Government here to try to do what we can, but I do not think it would be right for me to make general pronouncements on a question of this kind, particularly. after I have been the guest of the Government of Bermuda.

  NUCLEAR LAUNCHING SITES
  Mr. Wiggasked the Prime Minister the consideration which led to the decision to announce that nuclear launching sites are to be situated in Great Britain in advance of the operational production of the missiles to be launched therefrom.
  The Prime Minister: These matters have to be planned a long time in advance. I can see no reason for keeping the decision secret, even if it were possible to do so.
  Mr. Wigg: The Prime Minister was good enough to confirm on Tuesday the American point of view that the rockets are only in an experimental stage. Would he tell the House what possible advantage there is in telling the Soviet Union five years in advance so that they can remove their vital targets outside the fifteen-hundred miles range, while at the same time giving them a chance to build rocket sites from which to attack this island?.
  The Prime Minister: The hon. Gentleman is now anticipating his next Question.

  GUIDED MISSILES
  Mr. Wiggasked the Prime Minister why he agreed at the Bermuda Conference to accept United States missiles which are not yet in operational production.
  The Prime Minister: Because it is the quickest way of getting them.
  Mr. Wigg: If that is the quickest way of getting them and it will take five years, what would have happened if the Prime Minister had not done this? Would it take ten or twenty years?
  The Prime Minister: The "five years' delay" is entirely a matter of the hon. hon. Gentleman's imagination.
  Mr. Wigg: The right hon. Gentleman knows that that statement is not entirely accurate. On Tuesday he accepted Mr. Dulles's point of view that these rockets were in the experimental stage, and the statements of the State Department which set a period of five years. Would the right hon. Gentleman care to comment upon that?
  The Prime Minister: I did not accept anything.

BUSINESS OF THE HOUSE
Mr. Gaitskell: May I ask the Leader of the House whether he will state the business for next week?
The Secretary of State for the Home Department and Lord Privy Seal (Mr. R. A. Butler): Yes, Sir. The business for next week will be as follows:
MONDAY, 8TH APRIL—Committee stage of the Export Guarantees Bill.
Second Reading of the Magistrates' Courts Bill [Lords]
Consideration of Lords Amendments to the House of Commons Disqualification Bill.
Report and Third Reading of the Occupiers' Liability Bill.
Second Reading of the House of Commons Members' Fund Bill.
Consideration of the Motion to approve the Draft National Health Service (Superannuation) Regulations.
TUESDAY, 9TH APRIL—My right hon. Friend the Chancellor of the Exchequer will open his Budget.
WEDNESDAY, 10TH APRIL AND THURSDAY, 11TH APRIL—General Debate on the Budget Resolutions and the Economic Situation, which will be continued and brought to a conclusion on Monday, 15th April.
FRIDAY, 12TH APRIL—Consideration of Private Members' Bills.
It may be convenient for me to inform the House that it is proposed to adjourn for the Easter Recess on Thursday, 18th April, and meet again on Tuesday, 30th April.
Mr. Gaitskell: Can the right hon. Gentleman say whether or not a debate on the White Paper on Defence will take place before Easter?
Mr. Butler: We have considered this matter and we hope that it may be possible to have a debate before the Easter Recess.
Mr. Bellenger: Now that the White Paper on Defence has been published, can the right hon. Gentleman say when the House may expect to receive the Service Estimates in full?
Mr. Butler: I cannot guarantee that the main Service Estimates will be before us before Easter. They will be published after Easter and the debates on them will be after Easter. I think it is better to make that clear.
Mr. Pearl: The Leader of the House will remember that I asked last week about the atomic energy programme. Is it possible for us to have a White Paper next week? I know that it is linked with the capital investment programme, but are we likely to have it announced next week? If not, when can we expect it?
Mr. Butler: I cannot give an actual date, but I have been in touch with my noble Friend the Minister of Power. Directly I have a date I will make it available to the House.
Mr. Peart: Does the right hon. Gentleman appreciate that there is some urgency in this and that hon. Members are very anxious to know the details? Will he impress on his noble Friend that we are anxious to have it quickly?
Mr. Butler: Yes, Sir. I consulted my noble Friend shortly before coming to the House because I thought that this was a question which would be asked. I cannot give an absolutely categorical reply that there will be a statement next week, but I am hoping that that may be so.
Mr. Peart: Will it be a statement, or will it be included in the White Paper, because the Leader of the House will realise that he did say that it would he in a White Paper?
Mr. Butler: It will be attached to the White Paper on investment in the fuel and power industries.

COUNCIL OF EUROPE (UNITED KINGDOM DELEGATION)
The Prime Minister: With permission, Mr. Speaker, I wish to make a statement about the Council of Europe.
The Consultative Assembly will meet in Strasbourg on 29th April, and I have appointed 18 delegates from the Parliament of the United Kingdom. The distribution of the appointments between the parties is the same as in the previous delegation, that is, nine Members of the Conservative Party, eight Members of the Labour Party and a representative of the
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Liberal Party. I have also appointed a number of substitute delegates.
The appointments of the Labour and Liberal representatives and substitutes have, of course, been made on the basis of nominations by the Leaders of those parties. I will circulate the names of the delegates in the OFFICIAL REPORT.
The same delegation will represent the United Kingdom Parliament at the Assembly of Western European Union, which is expected to meet in Strasbourg on 6th May.
Following are the names:
Representatives from the Government benches—
The right hon. Member for Moss Side (Dame Florence Horsbrugh); the hon. Members for Aberdeenshire, East (Sir R. Boothby), Rutherglen (Mr. Brooman-White), Antrim, South (Mr. Knox Cunningham), Henley (Mr. Hay), Scotstoun (Sir J. Hutchison), Hertfordshire, South-West (Mr. Longden), and Farnham (Mr. Nicholson); and Viscount Stone-haven.
From the Labour Party—
The Leader of the Opposition, the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell), the right hon. Members for Brighouse and Spenborough (Mr. J. Edwards), Middlesbrough, East (Mr. Marquand), and Grimsby (Mr. Younger); and the hon. Members for Oldham, West (Mr. Hale), Stoke-on-Trent, North (Mrs. Slater), Bristol, South (Mr. Wilkins), and Sunderland, North (Mr. Willey).
From the Liberal Party—
The hon. Member for Bolton, West (Mr. Holt).
The following substitutes have been appointed to act for the delegates when they are absent from Strasbourg.
From the Government benches—
The hon. Members for Torquay (Mr. F. M. Bennett), Fermanagh and South Tyrone (Lieut.-Colonel Grosvenor), Gravesend (Mr. Kirk), Harrogate (Mr. Ramsden), and Wembley, South (Mr. Russell); and the Marquess of Lansdowne.
From the Labour Party—
The hon. Members for Batley and Morley (Dr. Broughton), Bedwelity (Mr. Finch), Motherwell (Mr. Lawson), and Salford, West (Mr. Royle).
From the Liberal Party—
Lord Rea.

QUESTIONS TO MINISTERS (MR. SPEAKER'S RULING)
Mr. Speaker: I have a short statement to make to the House.
On Thursday last I was asked by the right hon. Gentleman the Member for Llanelly (Mr. J. Griffiths) to consider the rules applicable when a number of Questions on the Order Paper are answered together.
First, in reply to the point raised by the hon. Member for Cardiff, South-East (Mr. Callaghan), which was whether every Member whose Question is so answered has the right to ask a supplementary question, I have no doubt that no such right exists. The difficulty lies in attempting to reconcile the rights of the individual Member with the rights of other Members and of the House as a whole. No hard and fast rule for effecting this reconciliation has ever been propounded. As in other cases where a similar conflict arises, the House has left the solution to the judgment of the Speaker. This judgment I must continue to exercise to the best of my ability until the House otherwise orders.
The Questions which gave rise to the point of order all related to tests of atomic weapons and the Bermuda talks. On this occasion the Prime Minister had four times stated that he preferred to answer these Questions in his speech opening the forthcoming debate. In these circumstances, it seemed to me better to give another Member the chance of asking a Question on another subject rather than have another repetiton of the same Answer.
The second point was raised by the right hon. Member for Llanelly, who asked whether a Member had the right to object to his Question being answered with others. On this, I see no reason to depart from my previous Ruling of 25th February of this year, that it is unreasonable for an hon. Member to object to an Answer which he has not yet heard. The alternative seems to me to involve a waste of the time of the House, since the Answer has already been drafted and will merely be repeated.
If the hon. Member asking the Question can subsequently show that his Question, or any part of it, has not been
584
covered, the Question, or the relevant part of it, can again be put on the Order Paper; and I can remember many occasions on which that has been done. But to insist on an Answer being repeated a number of times seems to me an abuse of the limited time for Questions. I hope that in the general interest of Members with Questions on the Order Paper, and, indeed, in the interest of the speedy and regular transaction of its business, the House will support me in this view.
Mr. J. Griffiths: We are very much obliged to you, Mr. Speaker, for the careful attention that you have given to the points which were raised by my hon. Friends and myself last Thursday. May I, with respect, put this to you? I gather from your Ruling that if an hon. Member objects to his Question being answered in conjunction with others he would then be entitled to put that Question down for further answer. [HON. MEMBERS: "No."] I understood that. Did I gather that the right of an hon. Member to object to his Question being answered with others still exists?
Mr. Speaker: An hon. Member can object, but whether I should sustain the objection would depend on the nature of the case. Whether any Question could be put down on the same subject depends on the rule of the House applicable to Questions normally, namely, whether the Question has already been fully answered during the Session. If an hon. Member has submitted the Question on the ground that the omnibus Answer did not, in fact, answer his Question, that, if indeed it was so, would be a good ground for putting the Question on the Order Paper again for answer.
Mr. Griffiths: The customary way for Ministers to answer Questions in conjunction with each other is to begin by saying, "With permission". That does imply, Sir, that the hon. Member has a right to refuse permission.
Mr. Speaker: I think that I dealt with that. I would point out that on occasions I have known 30 or even 40 Questions put down on the same topic to a Minister. Probably that was a fortuitous occurrence. Someone more suspicious of hon. Members' motives than I am might have thought that there was some concerted action in the matter. I think that if the

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House reflects, to have a Minister read out 30 or 40 times a prepared Answer while other hon. Members are waiting to discuss topics which are dear to their hearts would not be in the interests of the House as a whole.
Mr. Gaitskell: To clear the matter up finally, Mr. Speaker, would you confirm that the phrase "With permission", is a figure of speech which has no meaning at all?
Mr. Speaker: I think that it has value in that it is a courteous exordium, and courtesy is never out of place in the House.

ORDERS OF THE DAY

  ELECTRICITY BILL
  As amended (in the Standing Committee), further considered.
  3.41 p.m.
  Mr. Speaker: We now come to a series of Amendments to Clauses 13 and 14 which seem to me, if I can put it shortly, to propound two alternative financial schemes, one being that embodied in the Amendments in the name of the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) and his hon. Friends and the other being that embodied in the Amendments in the name of the Minister. It seems to me that it would be difficult to discuss each one individually without referring to the others.
  What I would propose to the House for its consideration is that we might have a general discussion on all these Amendments, and then I will call the Amendment standing in the name of the noble Lord for a Division, if that is required. If that is agreeable to the House, I think that it would make the debate easier, shorter and more relevant.

Clause 13.—(BORROWING POWERS OF ELECTRICITY COUNCIL, GENERATING BOARD AND AREA BOARDS.)
Mr. Richard Fort: I beg to move, in page 9, line 33, at the end to insert:
(2) The Generating Board or any Area Board may, with the consent of the Minister and the approval of the Treasury, borrow money by the issue of Electricity Stock for all or any of the following purposes, that is to say—

(a) the provision of money for meeting any expenditure incurred by a Board in connection with any works the cost of which is properly chargeable to capital account;

(b) the provision of any working capital required by a Board;

(c) the repayment of money temporarily borrowed by a Board.

I move this Amendment in the absence of my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke), who is away on the business of the House. He asked me, Mr. Speaker, to express to you his apologies on that account.
My noble Friend, my hon. Friends and I tabled the Amendment for two reasons. The first is to bring before the House

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a point made by Sir Edwin Herbert and his Committee which has not so far been fully answered by the Government in rejecting the reasoning put forward by the Committee. The second reason, and this is perhaps more fundamental, is that many of us feel that only by getting nationalised industries such as the electricity industry to go to the market can we make sure that they are really using to the best possible advantage the capital which they had been getting from Government sources or with Government support.
For many years I have held the view that this country's second most valuable asset, after our countrymen, is the savings which we make. Those savings should be used to the best possible advantage. Many of us feel that the method by which the nationalised industries have been allowed to draw capital with the full backing of the Treasury has often resulted in their not using that asset to the best possible advantage.
The Herbert Committee made this point extremely well in paragraphs 347– 350 of its Report. Its first remark, which does not represent the point of view of some of us, was:
"We believe that in the nature of things the use of capital cannot be as strictly or as closely guided by economic considerations as is the case in private industry."
I think we feel that the valuable asset of capital should be closely controlled whether it is in private or public hands.
The Report goes on:
"With this in mind, we have given serious consideration to the question whether Area Boards and the Generation Board should not be required to raise their own capital by going directly to the market, without the support of the Treasury guarantee, and competing there on the basis of the financial position and prospects of each of those bodies respectively. We feel that short of this it is very difficult to achieve full efficiency."
I know that last year my right hon. Friend the Prime Minister, when Chancellor of the Exchequer, took action which gave the Treasury closer control than in the past over the capital expenditure of the nationalised industries, including the nationalised electricity undertaking, but, even so I do not think that there is any party controversy about this—I believe that it has so far been impossible to work out a system of Government control to make the best use of the capital which
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these industries require or to make them use it in a manner comparable with that of private industry when it has to go to the market.
It is for those reasons that we tabled the Amendment, which seeks to give permissive rights to the Generating Board and the area boards to go to the market and employ that means of making their use of capital more efficient, provided that they first get the permission of the Minister, thereby making sure that their operations fit in with overall Government planning of capital expenditure.
Mr. Gerald Nabarro: I share the regret of my hon. Friend the Member for Clitheroe (Mr. Fort) that my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) is unable to be present to move this very important series of Amendments. My noble Friend went to Germany this afternoon. His absence is singularly um fortunate. because during our proceedings in Committee on the Finance Act of last year—sadly, at 4 o'clock in the morning —he initiated a discussion of similar Amendments standing in his name and my name dealing with the Clause in that Measure which placed directly upon the Treasury the statutory responsibility for a close scrutiny of the capital investment requirements of certain nationalised industries.
We are here discussing an industry which is by far the most expensive of all the nationalised concerns. I make no criticism of that, having regard to the capital equipment necessary in respect of generation plant, and especially as, in arithmetical progression, the energy demand of the country is rising at about 10 per cent. per annum. thus doubling every ten years, one would expect the sums of money involved to be very heavy. However, there may well be legitimate differences of opinion, in both fundamentals and incidentals, as to how the capital should be subscribed and what control should be exercised over it by Parliament or, alternatively, by money market considerations. That second point enters into the matter at every stage, and especially having regard to the very pointed and often critical comments made by the Herbert Committee.
The fact is, of course, that during our lengthy debates in Committee, all

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speakers, whether Socialist or Conservative, used sections of the Herbert Report to suit their particular argument. I do not exonerate Her Majesty's Government from idiosyncrasies of that kind. They followed exactly the same practice. In fact, certain major recommendations of the Herbert Report have been enshrined in the Bill. Others have been neglected and others have been amended and it would he fallacious to suggest that the Bill is an implementation of the whole series of recommendations of the Report. That is not so.
However, the Report is very explicit indeed upon this important matter of capital subscription. My hon. Friend the Member for Clitheroe quoted just one passage. There are other passages to which the House ought to give consideration today, because the Report is voluminous. It runs to nearly 200 pages and is packed with technical and economic data of every kind. The issue of the subscription of capital recurs at intermittent stages in the Report, but is right through the theme of the Report and every recommendation is consequential on the fundamental point that this very expensive nationalised industry should change its borrowing habits and that the Government should do all possible to induce it, as far as they are able. to resort to the money market, instead of the close umbrella arrangements which we have at present under the Finance Act of last year and earlier statutes with a Treasury guarantee.
The House might first care to turn to page 6 of the Report, where paragraph 26 contains words which are very carefully chosen and upon which, I am informed, the members of the Herbert Committee deliberated for a very considerable time. The words are:
"The electricity industry does not compete on equal terms in the money market, because in common with other nationalised industries, it has been given the benefit of raising money under Treasury guarantee on the national credit through the gilt edged market. The amount of capital to be raised, therefore, depends not upon the attractive power of the industry as such but upon the decision of Her Majesty's Government as to how much capital shall be raised on the national credit on its behalf. which in essence is a political decision in the sense that the Ministers responsible for making it are answerable to Parliament in respect of it. It appears to us that this unavoidably injects a political element
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into the whole structure of the industry including the price structure of its product."
That is a very clear statement of the position which has existed during the last ten years, but it does not mean to say that it is a desirable position, having regard to the high percentage of the national investment programme which is claimed by the electricity supply industry.
I shall aver in a moment that this is a practice which leads to wastefulness in resources and to financial extravagance. These views are not unique to me. They are views which are expressed in other words and in other forms by the Herbert Committee which investigated this industry so thoroughly. In paragraph 28, and these words are equally important, the Report says
"… although the industry is not required to earn a profit over and above the cost of servicing its loans, it should be conducted as a commercial concern, should be self-supporting and (except with regard to compensation stock) should be able to finance itself without any reliance upon a Treasury guarantee being always available for raising its capital…"
That is an extremely important announcement. It is the first time that an entirely impartial committee of investigation, an investigation undertaken on the generally accepted thesis that these great undertakings should be impartially considered every seven years, has decided and pronounced that this industry, the most expensive of them all, should resort to the money market without a Treasury guarantee.
Right hon. and hon. Gentlemen opposite can hardly criticise the method in which the Herbert Committee was established, its terms of reference, or the interval of years which was allowed to elapse between nationalisation of the industry—and it passed into national ownership on 1st April, 1948—and the date the Herbert Committee was established. It was the right hon. Gentleman the Member for Lewisham, South (Mr. H. Morrison) who said in the House in 1950 that his view was that, on balance—and I concurred from the then Opposition—that such impartial inquiries should be conducted into these nationalised undertakings, by persons suitably qualified and equipped to do so, once every seven years.
Mr. William Warbey: The hon. Member keeps using the word

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"expensive" about this industry. Will he make it quite clear that he is using that word in a rather odd sense, in which he means that it is responsible for a large proportion of the capital expenditure of this country, but not in the sense that it is inefficient expenditure, as every objective test shows that this is one of the country's most efficient industries and has reduced its real cost to the consumer?
Mr. Nabarro: Of course, there is an important distinction between the meanings of "expensive" and "extravagant". I said earlier that this industry took a major part of our capital investment programme. It is, therefore, expensive. I said, quite reasonably, and I do not think that anybody will quarrel with me, that in the very nature of electricity generation the capital plant required was expensive. That should not be a controversial statement. What will be controversial—and, my goodness, the hon. Member for Ashfield (Mr. Warbey) will not like it—is the statement that this industry is extravagant and wasteful.
Mr. Warbey: Nonsense.
Mr. Nabarro: The hon. Member says "Nonsense". We will quote from the Herbert Report. Evidently the hon. Member has not read the Herbert Report with the avidity with which he should have read it. Let us glance at page 91:
" As we shall show, there is ample scope for an attack upon costs, in the scale of capital expenditure, in the utilisation of capital, in the use of manpower and in other directions. In our opinion, the industry is languid "—
I emphasise the word "languid"—
" in its approach to these problems and we should expect to see a far more vigorous approach before the expedient of raising prices is contemplated."
Does the hon. Gentleman now say that my terms are extravagant, or that the industry is not extravagant? The use of the word "languid" is an indictment of the industry, in its approach to these matters, of very great importance, especially having regard to the fact that it is the most expensive of the nationalised industries. I will willingly give way to the hon. Member for Ashfield if he wishes to withdraw his earlier assertions. He does not. He shouted "Nonsense", but I think that my hon. Friends and I certainly prefer to have much greater
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regard to the deliberations and findings of the Herbert Committee and its admirable Report than to the personal opinion of the hon. Member for Ashfield.
I shall not quote at greater length from the Herbert Report because, as I have said, it is fundamental to all the recommendations and findings of the Committee that there should be resort to the open money market and as early as possible the expunging of the Treasury guarantee on the substantial sums of capital the industry raises. I claim that the first Amendment is exactly consonant with the economic and financial policy of the Tory Government during the last few years. Three or four years ago, we decided to grasp the nettle of local authority capital-raising activities and caused many of the larger local authorities not to have to resort any longer to the Public Works Loan Board, but to go direct to the money market.
4.0 p.m.
When my right hon. Friend replies he might tell me what is the difference in principle between the large local authorities going to the money market for their requirements and the nationalised electricity industry doing likewise. In fact, they both have a monopoly source of revenue, the local authorities through their rating system and other sources and the nationalised electricity industry through the revenue which it derives from the sale of current. I believe that the principle which the Treasury promulgated four years ago of causing local authorities to borrow their money on the open market should be extended.
Mr. Cyril Bence: Shocking.
Mr. Nabarro: It is not shocking. It has made a very important contribution to resolving financial problems in the last few years, and I emphasise that it has done a great deal to minimise extravagance in capital expenditure.
That is one of the primary reasons that the Herbert Committee recommended that there should be resort to the money market by the area electricity boards—for exactly that reason and to restore a greater degree of financial probity. It is true that my right hon. Friend has an annual scrutiny of the capital sums involved, but if there were unrestricted resort to Treasury

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finance the situation might be highly inflationary, as my noble Friend brought out very clearly in his speeches in Committee.
I turn to a different aspect of the problem, but one which the House ought to consider this afternoon. The sums of money which the nationalised electricity industry raises are not solely for the purpose of generating and transmitting electricity. The nationalised industry is involved in every kind of commercial enterprise connected with electrical contracting, directly in competition with private enterprise, and in the sale of appliances. There are tens of millions of pounds worth of electrical appliances sold annually from the retail shops and showrooms of the area boards. For example, one may go into an area board showroom in practically any town in the country and see it absolutely packed with electrical appliances of every description.
Mr. Ernest Davies: Why not?
Mr. Nabarro: I have no objection to the system at all providing that there are terms of parity and absolutely fair competition between the nationalised undertakings and private enterprise.
Mr. Bence: There are.
Mr. Nabarro: The hon. Member displays his ignorance in these matters by saying that there are. That is exactly what there are not. He keeps nodding. He must go away and learn the facts of life before he contradicts me in this matter.
I will give just two examples to show why the competition between the two is grossly unfair. There are scores and scores of these showrooms and shops, for the sake of example, which are not paying local rates; they are not paying a penny either through the pool of rates or direct to the local authority. They have never been assessed for rates, because they are part of a nationalised concern.
Does the hon. Member consider that it is fair that where a shop is selling refrigerators or carpet sweepers or electric blankets or cookers, because it is nationalised it should pay no rates, whereas the private enterprise shop down the road should pay rates?
Mr. Speaker: I can see that there is a connection between this point and the Amendment, but I do not think that we want to get involved in this discussion again. We have already had it.
Mr. Nabarro: I will leave the problem of local rates with this final statement on it—that there is great disparity in this matter today between the two.
What is more germane to this Amendment is the simple fact that the capital used for financing the stock in trade of these appliances in the area boards' shops and showrooms is being provided at artificially cheap rates under Treasury guarantee and at approximately half the cost which the private enterprise shopkeeper has to pay for his capital in financing the sale of appliances. It is no good the hon. Member for Dunbartonshire, East (Mr. Bence) shaking his head; this is a point which has readily been conceded, and if he will turn to the Herbert Committee Report he will find it clearly set out in that Report.
Mr. Arthur Palmer: Would the hon. Member care to give a figure showing the amount of capital expenditure on fittings, stocks and the domestic appliances to which he referred as a proportion of the total capital expenditure of the industry?
Mr. Geoffrey Hirst: That has nothing to do with it.
Mr. Nabarro: It is a matter of degree.
Mr. Palmer: It is a fleabite.
Mr. Nabarro: On the contrary, it is not a fleabite. It is a matter of £50 million. Is that a fleabite?
Mr. Palmer: What is the proportion?
Mr. Nabarro: I will give the proportion.
Mr. Austen Albu Mr. Austen Albu (Edmonton)rose—
Mr. Nabarro: May I answer this point first?
The fact is that in the aggregation the area boards last year sold appliances and carried out contracting services, in direct competition with private enterprise, to the extent of about £50 million a year. That is a very large sum of money. It is a trading expense.

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Of course, the net capital employed in that trading depends on how many times the stock was turned over in the course of a year, as everybody will recognise. The average sale of appliances in the average shop involves turning the stock over twice a year. If the hon. Member for Cleveland (Mr. Palmer) does a little sum, and divides £50 million by two, he will see that, taken on an annual basis, £25 million is vested in stocks in trade of these appliances in the shops of the nationalised industry. Does he still consider that a fleabite? He nods, so I presume that he does consider it a fleabite. In the Socialist pattern of finance it may be considered a fleabite, but to me £25 million is a very large sum of money, especially when it is money provided under Treasury guarantee and used, in my opinion, for a purpose to which, when the industry was nationalised, the Treasury never intended that the Treasury guarantee should apply.
Mr. Albu: Would the hon. Member stop being quite so emphatic and answer one question of fact? What is the capital sum which has to be raised by the Electricity Authority or the area boards for this purpose and what would be the difference between the interest paid on the capital at present for these enterprises and the interest the Authority would have to pay if it went to the free market?
Mr. Nabarro: I will deal with those two points; they are separate, but related.
If the hon. Member will turn back over the records of the OFFICIAL REPORT he will find that a few months ago I asked the predecessor of my right hon. Friend the Paymaster-General, the present Minister of Supply, Questions about the capital arrangements of these nationalised industries. In reply to one of those Questions, my right hon. Friend said that he had stopped all capital authority for appliances sold by hire purchase. Most of these appliances are sold by hire purchase, and it is, therefore, clear that he considered that this was a matter of considerable moment.
The hon. Member for Edmonton (Mr. Albu) asks what is the difference in the rate of capital. I will tell him willingly. The electricity industry is raising money at 4¼ per cent. In present circumstances
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that is an artificially low rate. If a private enterprise distributive or retailing firm sells an equivalent appliance from a retail shop it will have to pay approximately twice as much for its capital, which is the commercial rate today; it will have to pay approximately 8 per cent. to 10 per cent. for the capital which it is employing for that purpose.
Mr. Bence: No.
Mr. Nabarro: If the hon. Member wishes to contradict me, let him get up and do so.
Mr. Bence: Is the hon. Member suggesting that a retailer carrying stock and arranging credit with his bank to carry that stock would have to pay 8 per cent. to 10 per cent. on his overdraft?
Mr. Nabarro: I did not say "overdraft." If he borrowed from the bank he would pay the Bank Rate plus 1 per cent. or 1½ per cent., making a total of about 6½ to 7 per cent. But I did not say "overdraft." As usual, the hon. Member is very wide of the mark. The retailer would pay the appropriate market rate for risk capital. The carrying of stocks in a retailing enterprise requires risk capital. In present circumstances he would pay between 8 per cent. and 10 per cent. for it.
Several Hon Several Hon. Members rose—
Mr. Nabarro: No doubt in due course everyone will have an opportunity to reply to the points which I have made. I should not expect that any Socialist would agree with me. The Socialists believe that the nationalised industries should borrow their money either at infinitesimal rates of interest or at no rate of interest at all.
I am a Conservative and I believe exactly the opposite. I believe that the nationalised industries should pay the market rate for their capital. If the area boards are in competition with private enterprise, as they are in all their retailing and contracting activities, they should he required to pay the market rate for their capital in order that there shall be strictly fair competition.
That is in the Herbert Committee's Report. It is the general theme of the Report. It is the purpose of the Amendment standing in the name of my noble Friend the Member for Dorset, South (Viscount Hinchingbrooke) and myself.

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It is also the tenor of my right hon. Friend's Amendment that we will be discussing later. The tenor of my right hon. Friend's Amendment is that permissive power shall be granted to the area boards to go direct to the money market.
I am delighted, therefore, to find that my right hon. Friend and myself are exactly in agreement with one another on this important principle. [HON. MEMBERS: "No."] Oh, yes, we are. I see the right hon. Member for Lewisham, South nodding. We are exactly in agreement with one another. It is a matter of degree, possibly, but we are all moving in the broad stream of Tory policy.
Mr. Bence: The broad stream is muddy and sluggish.
Mr. Arthur Holt: In case, by inadvertence, the hon. Member misleads the House, may I point out that in both the original Act and in the Bill the intention always has been that the Treasury could give a guarantee? As far as 1 can see, nothing has ever prevented the Treasury from allowing the old Central Electricity Authority to issue stocks on the market without guarantee and to take the normal conditions.
Mr. Nabarro: As the hon. Member will appreciate, I do not yet sit on the Treasury Bench and it is no part of my purpose to enunciate Government policy. My right hon. Friend will do that presently.
What I was saying when I was interrupted by so many Socialists was that my right hon. Friend and myself are moving forward in the broad stream of good Tory policy. That is why right hon. and hon. Members opposite are so cross with us for having put down these Amendments this afternoon. I commend the first of these Amendments to my right hon. Friend. I know from the terms and the text of his following Amendment that it will have his most sympathetic consideration and I hope that in preference to his Amendment, he may consider it appropriate to write into the Bill the Amendment in the names of my hon. Friends and myself.
Mr. Herbert Morrison: We have just listened to an anti-consumer speech from the hon. Member for Kidderminster (Mr. Nabarro). Let there be no mistake about it. That was a speech, conscious and deliberate, in opposition to the interests of electricity
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consumers. It was meant to put up the price of electricity and it was meant to do that to discredit a nationalised industry.
I listened to the hon. Member for Clitheroe (Mr. Fort), who made a moderate, steady and constructive speech from his point of view, with which I do not agree. The hon. Member for Kidderminster, who followed him, was typically loquacious, speedy, denunciatory and inaccurate on a whole number of things, for which he is famous not only in this House but in the world of industry outside.
It is implied that the Government having appointed the Herbert Committee and the Committee having reported, we must not disagree with it. That is nonsense.
Mr. Nabarro: I did not say that.
Mr. Morrison: It was a respectable Committee. I do not agree with a number of its recommendations, but it did its work to the best of its ability. It is true that when 1 was Lord President of the Council I announced that the Labour Government would periodically appoint such reviewing committees at intervals of about seven years. I still think that it is a very good thing to do and to have done.
When the Committee has deliberated and produced its Report, however, it really is silly to handle the Report, as it has been handled, as if there was something divinely inspired about it and that it is wrong to disagree with any of its conclusions. It would be silly on the part of the Government, or of any of us, not to study the Report with care and attention, but we must be free not to be enslaved to it as we go along.
4.15 p.m.
The short point before the House is whether there should, or could, be a Treasury guarantee for the borrowings of the electricity authorities. The word "expensive" has been flung about as a typical device to give the public outside the impression that the Board will be squandering its capital expenditure. That is why the word was used. Under cross-examination, it had to appear that that was not meant but that what was meant was that the amount of capital expenditure on the part of the electricity supply industry was a big proportion of

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our capital expenditure. Of course it is. It always was. It was in the case of the companies, with the exception that a good many of the old companies did not spend sufficient capital and, therefore, did not keep their undertakings up to date. In that respect, the municipalities were, on average, in advance of the old companies.
The case of the local authorities and the Public Works Loan Board has been quoted. We strongly objected to the local authorities losing the facilities of the Public Works Loan Board. What are the consequences? The hon. Member for Kidderminster has advocated a policy which must put up electricity charges. Let it be understood that he is advocating —not that he said so, but the implication of all his speech was so—a policy which, inevitably, would put up electricity charges. The hon. Member is also the advocate of a burden on the local authorities that has helped to put up the rates and the Government must share responsibility for that.
The purpose of taking the local authorities as far as possible away from the sphere of the Public Works Loan Board was partly that they should have to pay a higher rate of interest and, therefore, they would not borrow. Consequently, the local rate burden has increased. What are we facing now? This is a publicly-owned industry. The generation and supply of electricity belongs to the nation. Incidentally, one point which I ought to mention is that the hon. Member for Kidderminster implied, at least, that the electricity authorities were not paying any rates.
Mr. Nabarro: I said that they were not paying them in every case.
Mr. Morrison: The hon. Member said that they were not paying any rates.
Mr. Nabarro: I said, not in every case.
Mr. Morrison: It was the hon. Member who brought in this subject, and he was verging on being out of order. Why could he not have explained the arrangement whereby there is, to the best of my recollection, a national scheme for electricity undertakings which was settled between them and the Government? There was a similar scheme in principle from the earlier days when the railway
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companies used to pay rates separately to the local authorities through whose areas their railways ran, and that was converted into a national scheme. I was connected with it as representing the London County Council.
Mr. Nabarro: I would not like the right hon. Gentleman to misunderstand the exact sector of the industry to which I was referring. It is true that there is a pool scheme for rates affecting power stations, and so on, but in the last few years a large number of additional retail shops have been opened by the area boards primarily for the sale of appliances, and most of those area board shops are not at present paying any rates at all. That was admitted at the time when the Rating and Valuation Bill was debated in the House. No doubt, there will be amending legislation to put it right, but that is the fact and it is no good the right hon. Gentleman contradicting it.
Mr. Morrison: An arrangement was made. If it was in the Rating and Valuation Bill, it is the fault of the Government, if fault there be. I did not come prepared to deal with the point, because I did not know that it was to be raised, and, therefore, I speak with restraint and moderation upon it. What, I think, happened was that national accommodation was reached between the valuation authorities and the electricity undertakings which would include all their undertakings. It could, I suppose, be argued that what are called the shops—some of which are mere collecting offices. but some of which, I agree, are substantial showrooms, and they are very well organised and attractive in appearance—should be separately assessed and that the benefit should go to the local authority in whose area they function.
Mr. F. H. Hayman: I suggest that the figure set aside for rates by the Electricity Authority for the current financial year is over £19 million.
Mr. Morrison: I am much obliged to my hon. Friend.
If that is so, let us consider what the effect of the hon. Member's speech on the ordinary citizen outside is likely to have and what he meant it to have. He wanted the man in the street to think that the

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Electricity Authority, being a publicly-owned concern, was not paying any rates at all.
Mr. Nabarro: Not paying enough rates.
Mr. Morrison: No, that is what the hon. Member wanted the man in the street to believe. The hon. Member is a Member of Parliament and we are entitled to have from all Members of Parliament a reasonable sense of fairness with this House, fairness to the nationalised industries, even when a Tory Member is speaking, and fairness to the public outside. The game of treating the House of Commons as if it were a cheap, amateur debating assembly is not good enough. The hon. Member is not doing the House any good and I do not think that he is doing himself any good. I say that it was wrong for the Government to have denied those facilities to the local authorities.
Here is a publicly-owned concern. It is national property; it belongs to John Bull. I know that is objected to by some hon. Members opposite, but I suggest that something had to be done about the electricity supply industry. There were other proposals, it is true, but they would not have commended themselves to public opinion. If John Bull wants to guarantee the capital borrowed for his own property why should he not do it? Why have hon. Members opposite to be so anti-British sometimes when they speak? Why must they impede the economic and financial well-being of property merely because it belongs to John Bull, whereas, if it belonged to private ownership, I would not put it past them to give it a Treasury guarantee?
In this case, it is said—I find it difficult to believe—that when the electricity people borrow in the free market, instead of getting their money at 4¼ per cent. with a Treasury guarantee, they would have to pay 8¼ per cent.
Mr. Nabarro: I did not say that. What I said was—and I will repeat it so far as I can recall my exact words—that the private enterprise shopkeeper raising risk capital for the purpose of financing appliances would have to pay 8 to 10 per cent. I did not say that the Central Generating Board, which finances power stations, would have to pay that figure. There is a very great difference in the risk entailed for the capital, but I would not
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expect the right hon. Gentleman to know the difference.
Mr. Morrison: I am not going to compete with the hon. Member for Kidderminster in rudeness, because I should get the worst of it. What does his argument mean? The whole purport of the argument was that the Electricity Authority ought not to be able to borrow at a less rate than private enterprise doing contracting business in the electricity supply industry. What does the hon. Member want to do? He wants the Electricity Authority, instead of borrowing at 4¼ per cent., to borrow at between 8 and 10 per cent.
Mr. Nabarro: The market rate.
Mr. Morrison: The hon. Member talks so loosely that he does not know even the implication of what he is saying. Still less does he know the implication of what he has said. He reminds me of the open air orator who, after a meeting one day, confessed, "My trouble is that when I get on the platform at a street corner I do not know what I am going to say; when I am speaking I do not know what I am saying; and when I have finished I do not know what I have said." So we get the line whereby the hon. Member contemplates that publicly-owned undertakings should pay 8 to 10 per cent. interest instead of 4¼ per cent., with the consequence to the ordinary citizens that their electricity would cost them more. The hon. Member is antisocial; he is against the public interest—everyone knows that he is against the public interest. We know it directly we look at him. He looks that sort of man.
Mr. Fort Mr. Fort rose—
Mr. Morrison: I was not referring to the hon. Member; he is a better looking chap.
Mr. Fort: Can the right hon. Gentleman tell the House why the consumer of electricity should have specially subsidised prices through the interest rate?
Mr. Morrison: I will give two reasons. One is that it is a great and necessary public utility service upon which the well-being of the country enormously depends and I would remind the hon. Member that it is not only the domestic consumer at home. There are vital private industries based upon electricity

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being abundantly and cheaply supplied, to quote the traditional words of our electricity supply legislation.
The hon. Member for Kidderminster did not care twopence about private industry in this respect. He may not have thought of that side issue, but it is true. His policy would be to put the price of electricity up to the industries of the country.
The Minister is a new Minister in this line of country. Notwithstanding the threats made to him and the implication that he is in the pocket of the hon. Member for Kidderminster, floating down the stream with him—and I would not advise him to float anywhere with his hon. Friend—I hope that the Minister will demonstrate that he has a mind of his own and that he will stand by the public interest which, it seems to me, it is his duty to do in circumstances of this kind.
The Paymaster-General (Mr. Reginald Maudling): As some of my Amendments, with your permission, Mr. Speaker, are being considered with this one, I think that it might be for the convenience of the House if I endeavoured to explain the difference between the Government's proposals and those made by my hon. Friends. I think I am right in saying that in some degree we are in accord with what they are suggesting, but to a considerable extent I cannot accept the argument that is being put forward.
The House will be aware that the present position, which is continued under the Bill, is that the Central Electricity Authority and the individual boards can borrow for temporary purposes with the consent of the Minister and the approval of the Treasury. That is the first point. All other borrowings, that is, in fact, all borrowings for genuine capital purposes will have to be made by the Electricity Council, as they are made now by the Central Electricity Authority, through the issue of British electricity stock, and it is provided in the Bill that the Treasury may guarantee the issue of such stock as to principle and interest.
The hon. Gentleman the Member for Bolton, West (Mr. Holt) was quite right in saying that this is a permissive and not a mandatory guarantee, and that there is nothing in the Bill to prevent the Government from allowing the Electricity Council to go to the market without a
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Treasury guarantee should it wish to do so.
Mr. Palmer: Would the right hon. Gentleman not agree that that was also the position in relation to the 1947 Act?
Mr. Maudling: I agree. The guarantee always has been permissive, but, in practice, it has always been used up to now, for very good practical reasons.
The capital situation at the moment in the industry is that under the Finance Act of last year the Treasury advances money to the Central Authority and the Bill continues this arrangement for the Electricity Council until 31st March next year. That is the general system whereby the capital requirements of the industry are financed—temporarily by temporary borrowing, and the main capital outlay by the issue of electricity stock by the Central Electricity Authority with the permissive guarantee, which has always been exercised in practice.
4.30 p.m.
At present, under the Finance Act, Treasury advances take the place of issues of stock. Above all this, there is the overall borrowing limit of £1,400 million, on all obligations other than the issue of compensation stock, which has been approved by Parliament. This is the situation at present and the Bill envisages, as previous legislation did, the issue of British electricity stock without a Treasury guarantee should it be considered desirable.
The Amendments in my name would give the individual boards power if they wish, and with the consent of the Minister and the approval of the Treasury, to make issues of stock on the market. That is the difference which we are proposing. In addition to the power of the Electricity Council to issue stock, we are proposing that individual boards should have the power to issue stock, with the consent of the Minister and the approval of the Treasury. There will be no question of a Treasury guarantee applying to these issues by the individual boards because, under Clause 15, the guarantee can apply only to the stock issued by the Electricity Council, and I do not think it possible, within the terms of the Money Resolution, to apply the Treasury guarantee to issues other than those of the Electricity Council itself.
Mr. Nabarro: In effect, my right hon. Friend is telling us, therefore, that the area boards may go to the money market and raise capital without Treasury guarantee on a permissive basis, exactly as the Herbert Committee recommended and thus in a directly opposite sense to the speech of the right hon. Member for Lewisham, South (Mr. H. Morrison).
Mr. Deputy-Speaker (Sir Charles MacAndrew): Is the hon. Member for Kidderminster (Mr. Nabarro) making a second speech?
Mr. Maudling: I am grateful to my hon. Friend the Member for Kidderminster (Mr. Nabarro) for making clear the effect of my own remarks, but I should prefer to endeavour to put my own case to the House, grateful though I am for his assistance. My hon. Friend has a peculiar knack of putting a question in the form of an assertion, which is most endearing to all of us who speak at the Dispatch Box.
Mr. Warbey: The right hon. Gentleman said that it is doubtful whether the Money Resolution would make it possible to extend the Treasury guarantee to the form of borrowing which he is now discussing. As he is introducing a new principle in the Bill, it would be possible to introduce an amended Money Resolution if the right hon. Gentleman wanted to do so.
Mr. Maudling: I am not proposing to do that, as the hon. Member will be well aware.
I was endeavouring to explain the effect of our Amendments and also the difference between ours and the body of the Amendments proposed by my hon. Friends. The effect of the Government Amendments, which are possibly a little complex, is that individual boards will have power, subject to Ministerial and Treasury consent, to make issues on the market, but they will not be able to have a Treasury guarantee. I suggest that this is logical. The Bill already envisages the possibility of the Electricity Council at some time borrowing without a Treasury guarantee. That has always been the case in previous legislation. If we envisage the possibility that the Council might borrow without guarantee, it is a, fortiori reasonable, when the area hoards' requirements are much
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less and more easily accommodated on the market, to envisage that the area boards should be able to go to the market without Treasury guarantee.
If we accept the logic of the Bill, and of previous Measures, that in certain circumstances the Council may go to the market without a guarantee, the smaller demands of the area boards can also be placed on the market without a Treasury guarantee. That is what our Amendments provide. The Herbert Committee Report, to which my hon. Friend the Member for Kidderminster so rightly referred, recommended that the various electricity authorities should go to the market on their own credit.
My right hon. Friend the Prime Minister, when he was Chancellor of the Exchequer, explained on 12th June last year the Government's attitude to this matter when he said:
"… we should like to move in the direction of the Herbert Committee's Report. It would be a good thing if these industries could borrow from the market on their own credit, but I do not think that that is practical. We have to face facts as they are, and the necessity for meeting the needs of capital investment in these industries at present by going to the market."—[OFFICIAL, REPORT, 12th June, 1956; Vol. 554, c. 529.]
My right hon. Friend was saying then that we on this side of the House accept what the Herbert Committee said in principle as a desirable objective towards which we should try to move, but not as a practical thing which we should try to do at the moment.
The difference between the Government Amendments and those of my hon. Friends is that while we make it permissive sometime for the Treasury to agree to this, my hon. Friends wish to make it mandatory now, and from this moment onwards to abolish the Treasury guarantee of these issues. I argue that it is not practical and not really possible at present to abolish Treasury guarantees for the issues that are made by the electricity authorities.
There are several reasons for this. In the first place, as the Herbert Committee rightly recognised, we cannot take action for one industry alone. It would be unreasonable to introduce a measure of that kind for the electricity industry without simultaneously doing it, for example, for the gas industry. That is one reason why we cannot immediately

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proceed to this system. It must be remembered, secondly, that the amounts involved and which need to be borrowed by the electricity industry are very large indeed. They are, of course, drawn from the same sources of finance as those from which Government borrowing is drawn.
Generally speaking, money put up for these issues is money that goes into gilt-edged. In the present circumstances, in which the main financial problem of the country is inadequacy of savings to meet total investment demand, nothing is more important than that the Treasury should maintain control over the money market and particularly over gilt-edged issues and issues of that character. In these circumstances, we must recognise that the Treasury must have proper control over gilt-edged and quasi gilt-edged issues.
Apart from the rate of interest involved, it would not be practicable at the moment to place on the market, without Government underwriting, issues of the size involved for electricity. It would not be practicable to issue electricity stock without a guarantee. It is the aim of underwriting to enable the market, technically, to meet the amount involved. The large amount involved here is one reason why, at the moment, it is not practicable to do what the Herbert Committee recommended and what the Government have recognised for a long time as desirable.
The question whether these issues should have trustee status or not is an important matter which we should have to deal with before making up our minds about a guarantee. What about the ranking of the stock? That point is not dealt with in my hon. Friends' Amendments, but it is dealt with in mine, to the extent of saying that at the time any such issue is made the Minister must provide by regulation as to its ranking, in view of the large amount of existing obligations that must be borne by the electricity industry.
There are, therefore, a number of reasons why we cannot accept that it is practicable at present to do what is suggested and to put these people on the market for capital borrowings without Treasury guarantees. That is why we have made it permissive and not mandatory. I do not think that people should
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exaggerate the effects of an operation of this kind. We must be practical about the arguments for these people raising their money, as it is said. on the open money-market.
I thought that the right hon. Member for Lewisham, South was not up to his usual form when he talked about John Bull in this connection. There is a solid. substantial argument here. It is that the amount of national capital available for industrial investment is limited and that it must be invested in such a way as to show the best possible return. I agree that electricity is vitally important, but so are coal, engineering and textiles, and it is difficult to argue definitely that investment in one form of industry should receive a lower rate of return than in any other industry. That is the substantial argument behind this Amendment and l do not think that it was given the seriousness which it deserves.
Mr. H. Morrison: It would put up the price of electricity.
Mr. Maudling: That intervention shows that the right hon. Gentleman is not treating this matter seriously. No one wants to put up the price of electricity. The right hon. Gentleman should not assume, as he assumes too readily, that, because there is a higher rate of interest on an investment, that has no effect on efficiency. My hon. Friends would argue that the higher the rate of interest paid the greater the incentive to show a good return on the investment, and the national interest in this matter is the highest possible return on what the nation invests. That fact should not be overlooked by right hon. and hon. Gentlemen opposite.
Mr. Morrison: If the electricity undertakings have to pay a substantially higher rate of interest that must have some effect upon the price the consumer pays. If the right hon. Gentleman is arguing that a higher rate of interest is to be welcomed for its own sake, as a painful stimulant to the efficiency of the industry, logically he ought to be advocating higher interest rates all round; indeed that the higher interest rates are, whether in public or privately-owned industry, the more efficient industry will be. He is landing himself in a difficult situation by that argument.
Mr. Mandling: What I am saying to the right hon. Gentleman is that I thought

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he was unwise in assuming that the electricity industry, if faced with high interest rates, would pass them on automatically to the consumer, and would not endeavour to cover some of them by increased efficiency.
I want to deal with this point a little more and to say one or two things about what my hon. Friend the Member for Kidderminster said in the course of his typically modest and brief speech. I would hesitate to say that my hon. Friend was dwelling in cloud cuckoo land, since he is never in the clouds, but on this point it is possible to exaggerate the effect of what he said about putting people on to the money market.
What do we mean by that? We must decide whether we are talking about equity issues or fixed-interest stocks in this connection. If my hon. Friend is thinking in terms of the boards making equity issues, that is a different matter, but within the framework of the Bill, and of the powers given to the Minister, I do not think that anything in the nature of equity issues can be. contemplated. The Minister's powers under Clause 20, to instruct the authorities what to do with their surplus revenues, would clearly be intolerable in the case of any equity issue.
Mr. Nabarro: May I make a further endearing intervention? All I did during the course of my speech, Mr. DeputySpeaker—and I was absolutely purist in my approach—was to follow precisely the line of the recommendations of the Herbert Committee. While I know that my right hon. Friend is quarrelling with many of those recommendations, I believe that Herbert is right in this matter—[An HON. MEMBER: "Who is Herbert?"] Not the right hon. Gentleman the Member for Lewisham, South (Mr. H. Morrison); he is always wrong. I think that it is a matter of mathematics here. I think that my right hon. Friend has gone a little way towards meeting us, but I still think that Herbert is more right than my right hon. Friend.
Mr. Maudling: I am sure that Sir Edwin Herbert would be most gratified. The point I was making was that I do not think that this can be a question of an equity issue.
Then we come to the question of a debenture issue. What would this mean?
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It was pointed out by my right hon. Friend the Chancellor last year that the boards have no power to charge their revenues. Well, we are providing here for the power of charging their revenues. So, in fact, the boards will be issuing fixed-interest stock charged on their revenues, and they have a statutory obligation to meet their revenue obligations year by year, including their interest obligations. This means, in practice, that anyone taking up a debenture or mortgage stock of an electricity undertaking is getting as near as it is possible to get to a gilt-edged security; in fact, it would probably have to be issued at½ or¾ per cent. above the gilt-edged rate. However, I do not see a great advantage in that one way or another, because anyone investing in electricity stock in such circumstances would own a security which was as good as it could be. Therefore, I do not think that there is much involved in this change in the long run.
4.45 p.m.
Mr. Fort: I do not follow the course of my right hon. Friend's argument. Earlier, he was arguing the difficulties of underwriting and now he is arguing that these are equivalent to Treasury guaranteed stocks.
Mr. Maudling: My point is a valid one. It was that in current circumstances it is difficult to see how these large issues could be marketed efficiently without Treasury underwriting. We can envisage a time when stocks could be marketed without Treasury underwriting, but I was saying that when we do so it will not make all the difference that people think, because when local authorities have gone to the market it has generally been for the finance that it should be able to bear. It will not make a dramatic difference to the financing of electricity undertakings, as it has not to the financing of the local authorities.
If I may sum up my points, they are as follows. I think that both sets of Amendments would give the individual boards the right, with Ministerial sanction and Treasury approval, to go to the market, and neither set of Amendments would give them a Treasury guarantee. The difference between them is that the set of Amendments proposed by my hon. Friends would make it mandatory from the; start that the boards should go to the

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market without Treasury guarantee. I am suggesting that we should put into the Bill a right that the Electricity Council already has, which is, in suitable circumstances, to go to the market of its own accord. We should extend that right to the individual boards. It is more than likely that they will be able to go to the market for their smaller requirements before the Electricity Council can go for its large demands.
In extending this possibility to the area boards we should make it always subject to the consent of the Minister and the approval of the Treasury, because, obviously, this will not be a practicable proposition until conditions in the gilt-edged market are adequate, and the flow of savings is adequate, to ensure that the issues are made in the way they should be made.
Sir Frank Soskice: Before the Minister rose I thought that I should be able to congratulate him on standing his ground this time, but I was naturally suspicious as to when he had spoken, I would still be of the same frame of mind. I am delighted to think that the right hon. Gentleman has stood his ground on the gilt-edged issue raised by the Amendments put down in the name of the noble Lord. It is brave of him, and it is a refreshing experience to us to see it.
The Minister was extremely apologetic to his hon. Friend the Member for Kidderminster (Mr. Nabarro). The right hon. Gentleman turned to him many times and did all he could to make the hon. Gentleman believe that he was, in principle, going almost as far, if not quite as far, as the hon. Gentleman and his hon. Friends wanted. However, the Minister cannot disguise it, and I do not believe he will have satisfied his hon. Friend, despite the professions of satisfaction to which we listened when the hon. Gentleman was speaking.
The real issue raised by these Amendments, both the Minister's and those of his hon. Friends, is briefly as follows: is the power of the Treasury, a permissive power to underwrite large-scale issues by the Electricity Council requisite for the capital provision for this industry, to remain or not? The issue really is the Amendment in the name of the hon.
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Member for Kidderminster, which would seek to take away that power. We are glad to see that the Minister has retained it. That is what we on this side of the House were anxious to ensure, and that is what we were concerned with. We wished it to be quite clear in the Bill, as it has always been under the 1947 Act, that these large-scale capital requirements can be obtained at a rate which will be appropriate to an issue guaranteed by the Treasury. We wanted to make certain that the Electricity Council, and in general the capital requirements of this industry, would not depend upon the market rate of interest.
Having listened to the Minister, and having studied with great anxiety the Amendment he put down and the Amendment with which he was dealing when he spoke. speaking for myself, I feel satisfied that he has retained that power in the Treasury. That is all we on this side of the House are really concerned about. In an endeavour to pacify his hon. Friends, the Minister put down an Amendment which gives a permissive power to the area boards and to the Generating Board for their minor requirements, if they do not wish to make use of the Treasury guarantee, to chance their arm on the money market independently. If they want to do so, and if they wish to pay a higher rate of interest than they need pay; if they want, in consequence, to charge the consumers more than need be charged, that is their own responsibility, and no doubt they will have to answer the criticism which would justly be levelled against them if they did adventure in that way, making use of these new powers. We do not mind those powers being in the Bill, if the Minister thinks it necessary to put them in the Bill, to pacify his hon. Friends. We do not think the Bill is much worse, and certainly it is none the better, so we are content that they should be there.
The fundamental issue raised in this debate, and there is really no concealing it, is this. The question is whether, as the Herbert Committee said, this industry should still be capable of supplying electricity to consumers at an extremely cheap rate—relatively, extremely cheap, as the Herbert Committee says—or whether that power is to be taken away from it by the Amendments put down by the hon. Member for Kidderminster and his hon.

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Friends. The hon. Member for Kidderminster read a portion of the Herbert Report, but he read a portion which simply served to support his own arguments. If the hon. Gentleman had been fair in trying to give a fairly balanced view of the recommendations of the Herbert Committee, there are certainly other passages that he might have read. In his speech, he ranged throughout the Report, and if he had wanted to be fair, he might have asked the House to look at paragraphs 33 and 34. In view of the fact that he did not read them, I propose to do so. Paragraph 33 of the Herbert Committee's Report said, in referring to the industry:
" It has made substantial technical advances and it has succeeded in supplying electricity to consumers at a price which on the average is only 30 per cent, above that ruling in 1939. This has been done at a time when the cost of coal, the principal raw material of the industry, has increased by 270 per cent, and the general cost of living index has risen by 137 per cent."
Contrast the figure of 30 per cent with the figure of 137 per cent. The Report goes on, in paragraph 34:
" We doubt whether the ordinary domestic consumer has any idea of how cheap his supply of electricity is. The average consumption in domestic premises in England is of the order of 1,400 units a year. At the average price paid by the domestic consumer this works out at about 3s. 6d. per week. For this price, the consumer can light his house in a clean and convenient form and also add to his heating comfort at critical times; and he may have a television set and a radio receiver as well. All this he gets for the equivalent of the price of 20 ciragettes. His daily expenditure on electricity is the equivalent of the cost of three boxes of matches."
I read that quotation because the hon. Member for Kidderminster quoted passages which served only to support his own arguments, and to distort, if I may say so, the whole debate upon which we have embarked. Why we object to his Amendment, and the Amendments which his hon. Friends had put down with him, which they have endeavoured to force upon the Government, is that we feel that if the boards are to have to pay higher rates of interest, it will be very difficult to prevent at any rate some part of that extra cost being passed on to the consumer. As my right hon. Friend the Member for Lewisham, South (Mr. H. Morrison) said, these Amendments are really anti-consumer Amendments, and we are very glad that the Government have had the courage at long last at least
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to resist some of the proposals of the hon. Gentleman.
Mr. Nabarro: I do not want to let the right hon. and learned Member for Newport (Sir F. Soskice) get away with accusing me of being biased in this matter. The passages in the Herbert Committee Report which I quoted, and I quoted scores of passages in Committee upstairs, were only those which deal with the raising of capital, and it is absolutely undeniable that the words used by the Herbert Committee were that the industry is languid in its approach to the matter of the utilisation of capital and the scale of capital expenditure. The Report uses the very damaging term "languid", and as we are debating on these Amendments the question of raising capital, I suggest—
Mr. Deputy-Speaker: I must remind the hon. Gentleman that we are on Report stage.
Sir F. Soskice: You have been very lenient up to now, Mr. Deputy-Speaker, and I hope I shall keep strictly within the limits which you have kindly permitted me. I only mentioned that subject because it was initiated by the hon. Member opposite. As the hon. Gentleman now suggests that I am trying to show that he is biased, may I add that I would not be blazing a trail if indeed I said that.
I am somewhat tempted when the hon. Gentleman omits a passage of the Report which is immediately and directly relevant to this debate, and selects one particular sentence containing the ward "languid", repeats it three or four times, and seeks to imply that the Report means that this is a sluggish, languid and inefficient industry, when in fact the burden of that Report is precisely the opposite. If I have incautiously used any language implying that the hon. Member is biased, I would put it forward as a somewhat venial offence, for which I ask his pardon.
Mr. Nabarro: Readily granted.
Sir F. Soskice: I am much obliged to the hon. Gentleman. Indeed, I feel much better after that.
If I may come back strictly to the debate upon which we are engaged, provided that the Minister does not go any further, we are content to let him have his Amendment. I must call attention to

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certain ominous remarks—I will not say rumblings—which went on throughout the course of his speech—references to not being able to go further at present; and I think we all understand on this side that the right hon. Gentleman has been in great difficulty and that he had to throw some sop to his hon. Friend. I do not think that the statement that he has made about the present unduly alarms us, because he and his colleagues obviously will not occupy the positions they hold very long, and therefore we feel that there will not be time for them to do very much more harm; but, for the present, the right hon. Gentleman has gone as far as we think it is proper for him to go, and if he stops, as he has stopped, at giving extra powers which the area boards are unlikely to use to borrow money at a rate of interest higher than that which they need pay, we say that his exercise is a rather futile one but is not one particularly harmful in itself.
I am very glad that the right hon. Gentleman has had the courage to resist his hon. Friends for once and, as a reward for it, perhaps my hon. and right hon. Friends will not cavil too much at the rather ineffective and useless change which he himself seeks to introduce into the Bill in order to get himself out of his difficulties.
Mr. Warbey: After the speech of my right hon. Friend the Member for Lewisham, South (Mr. H. Morrison) and that of my right hon. and learned Friend the Member for Newport (Sir F. Soskice). it is hardly necessary for anyone else to engage in deflating the demagogy of the hon. Member for Kidderminster (Mr. Nabarro), because it has been done already most effectively. When the hon. Gentleman accused me of not reading the Report with avidity, I accept that soft accusation. He clearly has read it with avidity in order to find in it every sentence, phrase, dot and comma which will justify his own prejudices and pro- vide him with ammunition with which to sling arrows against the nationalised industry. He has certainly read it without judgment or perception.
I want to express a slightly greater degree of anxiety on the views expressed by the Paymaster-General than has been expressed so far from this side of the House. The Paymaster-General may not
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yet be swimming in the broad stream of Tory philosophy àla Kidderminster, but he is doing his best to keep up with the tide. He has already made a number of surrenders, and his firm stand on this occasion, when examined, is not quite so firm as we on this side of the House would like to see. He indicated that his Amendment is a step in the direction desired by the hon. Members behind him—
Mr. Nabarro: Hear, hear.
Mr. Warlbey: —and we now have that confirmed by the hon. Member for Kidderminster. Knowing how regrettably successful the hon. Member for Kidderminster and his hon. Friends have been in chasing and hounding Ministers up to now—and not only this Minister, but others too—if this Government stays much longer in office, that firm stand which the Minister has taken today on this question may very soon turn out to have similar feet of clay to the other firm stands which he has made.
In putting forward the case for his own Amendment, the Minister was careful not to give any examples of the way in which area boards might require to use the power which he is so graciously conferring upon them. I wonder if the Paymaster-General or the Parliamentary Secretary could tell the House exactly in what circumstances an area board would want to go to the open market to raise capital, undoubtedly paying a higher rate of interest and paying commission to people to enable it to raise the capital, when it might obtain that capital by means of a Treasury guarantee.
5.0 p.m.
Mr. Maudling: I think in rather similar circumstances to those in which some local authorities decide to do the same thing.
Mr. Warbey: I am very glad to get that response from the right hon. Gentleman, because that is exactly what I feared. It is now clear from the reply of the right hon. Gentleman that the purpose of the Amendment which he proposes is to enable the Government at some future date to force the area boards to go to the open market as they have forced the local authorities to go to the open market. That is the real purpose of the Amendment. I wonder if the Minister heard what I said, because this is a very important point.
Mr. Maudling Mr. Maudling indicated assent.
Mr. Warbey: I hope that the right hon. Gentleman is assenting to the interpretation which I am putting on the Amendment.
It is perfectly clear that it is extremely unlikely that any area board would want of its own volition to pay a higher price for the capital that it raises. It would do so only in circumstances in which it was prevented from borrowing capital under Treasury guarantee.
What are the circumstances in which it would be prevented from borrowing under Treasury guarantee? They are circumstances in which the Minister refuses to give his approval to a request from an area board for sanction for the carrying out of a capital development programme and for the raising of funds to carry out that programme by means of stock under Treasury guarantee. Those are the only circumstances I can envisage in which area boards would want to use the powers which the Minister says he is conferring upon them.
In other words, this is a way of introducing within a nationalised industry the same conditions which have been applied by the present Government to the local authorities. It is a way of making it possible for the Government to compel parts of a nationalised industry to go to the open market when the Government want to restrict capital development or want to prevent the industry from borrowing capital under Treasury guarantee.
Mr. Maudling: It is putting them in the same position as the Central Authority was placed under the initial Act—exactly the same position.
Mr. Warbey: The Minister may place very great stress upon the difference between the words "may" and "shall". I am sure that the Parliamentary Secretary, with his legal experience and his experience of the working of Acts of Parliaments in which the words "may" or "shall" appear, knows very well that when the word "may" appears in the 1947 Act the general intention is that the stock should be issued under Treasury guarantee, although it does not rule out the possibility of a variation from that in certain circumstances—circumstances which may never arise and which were probably never expected to arise by the drafters of that Measure.
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Probably my right hon. and hon. Friends would agree that we really did not envisage the idea of the nationalised industries going to the open market to raise their capital in competition with private industry. That was never our conception of the way in which things should be done. The fact that we left the door open for that as a possibility dues not mean that we considered it as a policy.
It is now quite clear from the way in which the right hon. Gentleman has brought forward the Amendment that it is submitted as part of a deliberate Government policy in order not only to throw the door wide open but so that the opportunity will exist for the Government at some future date to be able to operate this policy of compelling area boards to go to the open market just as they have compelled the local authorities to go to the open market and to pay a higher price for their capital than they have had to pay through the Public Works Loan Board and, of course, with the same results.
Just as local authorities are having to put up their rates and impose higher payments upon their residents as a result of having to borrow capital in the open market, so the area boards may be compelled to put up their prices to the consumer, because a Conservative Government have compelled them to raise capital on the open market.
I hope that now we have had this confirmed by the Minister himself, my right hon. Friends will consider again whether we ought to accept the Amendment in the name of the right hon. Gentleman. I suggest to my right hon. and hon. Friends that we ought to look at the matter again very carefully indeed in the light of the admission made by the Paymaster-General and consider whether we ought to oppose the Government Amendments, perhaps not as emphatically, but equally, in the Division Lobby as we shall certainly oppose the the Amendment in the name of the hon. Member for Clitheroe (Mr. Fort) and other hon. Members.
Mr. Fort: In view of the undertakings given by the Paymaster-General during the discussion we have had on the subject, I beg to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Amendments made:In page 10, line 15, at end insert:
(4) The Generating Board or any Area Board, after consultation with the Electricity Council, and with the consent of the Minister and the approval of the Treasury, may borrow money by the issue of stock, for all or any of the following purposes, that is to say,—

(a) the redemption of any stock issued by the Board;

(b) the provision of money for meeting any expenditure incurred by the Board in connection with any works the cost of which is properly chargeable to capital account;

(c) the provision of any working capital required by the Board;

(d) the discharge of any responsibility allocated to the Board in respect of British Electricity Stock or Exchequer advances, in so far as that responsibility is attributable to the principal of that Stock or of those advances;

(e) any other purpose for which capital moneys are properly applicable by the Board, including the repayment of any money temporarily borrowed by the Board for any of the purposes mentioned in this subsection;

(f) any other payment which the Board are authorised to make and which ought in their opinion to be spread over a term of years.

In line 23, leave out "British Electricity".
In line 31, leave out from "Council" to "for" and insert:
"the Generating Board or any Area Board from borrowing".
In line 33, leave out from second "or" to "of" in line 36.—[Mr. Renton.]

Clause 14.—(ISSUE OF STOCK.)
Amendments made:In page 11, line 4, at end insert:
(2) The Generating Board or any Area Board may create and issue any stock required for the purpose of exercising their powers under the last preceding section; and any stock so created and issued by one of those Boards shall be known by the name of that Board followed by the word "Stock ".
In line 14, at end insert:
(3) For the purposes of issues of stock by the Generating Board or by Area Boards, provision may be made by regulations made by the Minister with the approval of the Treasury—

(a) for empowering the Board issuing any such stock to charge the stock and the interest thereon upon the revenues of the Board, with or without power to charge the stock and the interest thereon upon the undertaking of the Board;

(b) for treating the obligations of such a Board under the following provisions of this
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Act in respect of payments to the Electricity Council, and contributions to the central guarantee fund, as a charge upon the revenues and undertaking of the Board, and for determining how that charge shall rank in relation to any charge upon those revenues or that undertaking created by the Board in connection with any such issue of stock;

(c) for prescribing (subject to any provision made by virtue of the last preceding paragraph) the terms upon which any such stock may be issued, transferred, dealt with or redeemed;

(d) for applying (with or without modifications) any provisions of the Local Loans Act. 1875, or of any enactments relating to stock issued by a local authority;

and different provision made be made by any such regulations in relation to different Boards or in relation to different issues of stock by the same Board.
In line 15, leave out "the last preceding subsection" and insert "this section".—[Mr. Maudling.]

Clause 25.—(COMPENSATION TO MEMBERS AND OFFICERS OF CENTRAL AUTHORITY.)
The Parliamentary Secretary to the Ministry of Power (Mr. David Renton): I beg to move, in page 20, line 26, after "Authority", to insert "or any Area Board".
This Amendment brings the employees of area boards within the purview of the Regulations which may be made under Clause 25 (2). That subsection governs the compensation which is payable to officers in the industry who might be adversely affected in consequence of the Bill in the same way as employees of the Central Authority.
We have put down the Amendment in pursuance of a request made during the Committee stage by the Opposition. I need only add, just to repeat what my right hon. Friend said in Committee, that we think it is most improbable that any area board employee will be adversely affected in the way feared by hon. Gentlement opposite. We do, however, agree that it is right in principle that the position of such employees should be covered in case they should be adversely affected.
Mr. Palmer: We on this side are grateful to the right hon. Gentleman and to his hon. and learned Friend for bringing in this Amendment in response to the request we made. The Amendment which we put down, which we thought would serve the same end, was imperfectly

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drafted, as is so often the case with Amendments put down by an Opposition, and we withdrew it on the understanding that the Government would bring forward a suitable Amendment. As the Parliamentary Secretary points out, it is a most useful provision, and it will give a feeling of confidence and security to employees in the industry.
The Bill as drafted allows for compensation only to members of the Central Authority and to officers or employees of the Central Authority, in the event of their conditions of work, emoluments and so on being worsened by reason of the Bill becoming an Act and coming into force. The logic behind it is, I imagine, that it is the Central Authority which is wound up by the provisions of the Bill, and it is unlikely that employees of the area boards will be adversely affected. We appreciate the logic of the argument, but we felt—and representations were made to us by the trade unions and staff associations on the point—that one can never tell what will happen as a consequence of legislation. That has been the experience of the electricity supply industry in the matter of staff compensation, and, in order to put all doubts at rest, it was felt that employees of the area boards should be similarly protected.
The general effect of the Amendment. as I see it, is that any employee of the industry or member of a board who happens to be adversely affected by the coming into force of the Bill will be entitled to compensation on the terms and conditions laid down. We are grateful to the hon. and learned Gentleman for his Amendment.
Amendment agreed to.
Mr, Renton: I beg to move, in page 20, line 29, at the beginning to insert:
"Subject to the next following subsection." go.
May I suggest that this Amendment, which is really consequential upon the next Amendment to insert new subsections (4) and (5), should be taken with it? The effect of the two Amendments is this. First, the decisions of referees when deciding upon compensation to officers for loss of office and so on should be subject to appeal to the High Court on case stated, if erroneous in point of law. The other point which is covered
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is that, when there is an appeal from the decision from the High Court to the Court of Appeal, that shall not be the end of the matter, but there may be a further appeal to the House of Lords, also, of course, on a point of law, provided that either the Court of Appeal or the House of Lords gives leave to appeal in the usual way. Again, in pursuance of representations made by the Opposition in Committee, we have put down these Amendments to cover both those points.
5.15 p.m.
Sir F. Soskice: I rise simply to express my thanks to the bon. and learned Gentleman. As he says, anxiety was voiced in Committee about the two matters he has mentioned. He has, by his Amendment, sought to meet those anxieties. I should like to thank him very cordially for so doing.
Amendment agreed to.
Further Amendment made:In page 20, line 36, at end insert:
(4) Where any regulations made under sob-section (2) of this section provide for appeals to be brought as mentioned in paragraph (b) of subsection (5) of the said section fifty-five, the regulations shall make provision—

(a) for enabling any party to such an appeal, who is aggrieved by the decision of the referee or board of referees on tie appeal as being erroneous in point of law. to require the referee or board to state a case for the decision of the High Court, and

(b) for requiring the decision of a referee or board of referees on such an appeal to be modified, where requisite, so as to conform with the decision in any proceedings in the High Court on a case stated in accordance with the preceding paragraph, or in any proceedings arising from any such proceedings:

and a decision of the High Court on a case stated in accordance with paragraph (a) of this subsection shall be treated as a judgment of that court for the purposes of section twenty-seven of the Supreme Court of Judicature (Consolidation) Act, 1925 (which relates to the jurisdiction of the Court of Appeal to hear and determine appeals from any judgment of the High Court.
(5) So much of subsection (5) of the said section fifty-five as provides that the decision of the referee or board of referees shall be final shall have effect, in relation to appeals brought by virtue of this section, subject to the provisions of the last preceding subsection and of any regulations made in accordance therewith.—[Mr. Renton.]

Clause 28.—(ENTRY ON LAND FOR PURPOSES OF EXPLORATION.)
Mr. Maudling: I beg to move, in page 23, line 43, after the first "that", to insert:
(a) subsection (4) of that section (which requires twenty-four hours' notice to be given of an intended entry upon any occupied land) shall so apply as if for the words "twenty-four hours" there were substituted the words "twenty-eight days"; and
(b).
This Amendment is designed to meet anxieties expressed on both sides of the Committee in regard to new powers proposed for compulsory entry upon property for purposes of survey and, where necessary, sinking boreholes. It was said in Committee by hon. Members on both sides that the proposal we were putting forward, namely, to apply the provisions of the Town and Country Planning Act, 1947, was not really satisfactory and that, in particular, the term of notice to be given when a compulsory order is served, which was twenty-four hours, was inadequate.
The purpose of the Amendment is to substitute the words "twenty-eight days" for the "twenty-four hours" which appears in the town and country planning legislation. There is no doubt that this extension should meet any possible objection. It was, I think, an extension which was welcomed by the right hon. and learned Gentleman the Member for Newport (Sir F. Soskice); he himself thought that twenty-four hours was altogether too short a period.
I should like to stress again that these compulsory powers would be used only where voluntary negotiations failed. Clearly, the policy must be to rely on voluntary negotiation first. But it is impossible to contemplate a situation where an entire project, for which compulsory power of acquisition might be granted, could be held up because of some refusal even to give the right of survey in advance to determine the nature of the soil. By extending the period from twenty-four hours to twenty-eight days, we are, I think, meeting all the objections which were voiced in Committee.
There were two other points raised. It was said in Committee that when notice is given to the occupier, notice should be given to the owner also. That is a very reasonable point, but it is difficult to embody it in a Statute. The Central
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Electricity Authority has undertaken that where any notice of this kind is served on an occupier, it will do its best to serve notice on the owner, and, where it cannot easily serve notice on the owner, the least it will do is to post a notice to the owner "c/o" the occupier so that the owner will receive notice at the same time.
The other point was raised by my hon. Friend the Member for Norfolk, South (Mr. J. E. B. Hill). He said, very reasonably, I think, that if boreholes are sunk in someone's land, the Central Electricity Authority should let the owner and occupier of the land know the result of the testing of the land carried out by the sinking of the borehole. That is quite reasonable, and I agree that the results should be made known to the owner and occupier of land.
I hope that the Amendment will commend itself to the House. It is, I believe, carrying out the wish generally expressed by hon. Members on both sides of the Committee.
Sir F. Soskice: As the right hon. Gentleman has said, we had a lengthy debate, in which hon. Members on both sides of the Committee actively joined, on the rights of entry given by the Clause. The upshot of the discussion was that the general sense of the Committee was that, if the period of notice were lengthened, it would, broadly speaking at any rate, meet the objections which were felt. The Minister has substituted twenty-eight days for twenty-four hours. Whether a period of twenty-eight days is necessary is, perhaps, open to question, but at any rate it is the period which he has chosen. Speaking for myself I would have no objection to it. If twenty-eight days' notice is given, it is not unreasonable that a public authority operating in the public interest should have the right, after such notice, to enter upon land in order to make the inquiries necessary for the purpose of efficiently carrying on the undertaking.
I would certainly advise my hon. and right hon. Friends to agree to it. I think it improves the Bill, and we certainly shall not seek to divide against it.
Mr. Edward du Cann: I should like to congratulate and thank my right hon. Friend the Paymaster-General for introducing this Amendment, which I

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most warmly support. As the right hon. and learned Gentleman the Member for Newport (Sir F. Soskice) has said, it is something which gives us all pleasure, and, indeed, satisfies a feeling which exists, not only in the House but outside also, that one must do one's utmost to protect the rights of private individuals against these large public corporations.
The Paymaster-General rightly said, both in Committee and in his very short speech just now, that this power is used only after an attempt to get agreement has failed. I should like to say that from the investigations I have made concerning the South-Western Electricity Board, it seems to me that that board—and I am sure other boards as well—scrupulously observes the voluntary obligation, so to speak, to try to get agreement. Where it cannot, it is often because of the unnecessary obstinacy of the private individuals concerned.
There came to my attention only the other day, a case outside my own constituency where someone refused the South-Western Electricity Board the quite reasonable access it was seeking to make an inspection. Eventually, when the board did get access, it found that it need not have troubled the individual after all. Had he only been co-operative and helpful he could have had a satisfactory answer at once.
That brings me to another point. I hope the fact that the private individual's rights are being looked after in this way —quite properly, as I think—will not result in any unnecessary delay in getting on with necessary surveys. That is extremely important. It would be a great pity if, after these safeguards—and this one in particular—had been put into the Bill there was any unnecessary delay or obstruction on the part of any private individual.
None the less, I think that we should recognise that there is a great feeling among the members of the public—I do not say that it is always justified—that while it may be inevitable and right, in a minor way at any rate, that the powers of these Government corporations, nationalised boards and the like should be increased, at the same time private individuals are having their rights whittled away. People sometimes feel that that is done unnecessarily. I hope that this Amendment will convince them
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that, at least in this case, due regard is being had, as is appropriate, to the rights of the private individual.
In particular, I should like to congratulate my right hon. Friend on saying that the electricity undertakings will in all cases do their best to get in touch with the owners. That is very important. In these days when land registration is increasing so much it should be much easier, as the years go by, to do that, although I know that it is something that one cannot put into a Statute. I know of a most unfortunate case in my own constituency where, due to the operation of the 1947 Town and Country Planning Act—which was taken, I know, largely as a model for this Clause—an owner was not given notice, and planning permission was given to someone else who got in behind the owner's back in such circumstances that fraud could have followed. I feel that we should lean over backwards to see that private individuals' rights are safeguarded, and owners informed.
I am sure that the House is very grateful to my right hon. Friend for heeding the feeling of the Committee, and I warmly support the Amendment.
Mr. C. R. Hobson: After that speech the hon. Member for Taunton (Mr. du Cann) will possibly get a reputation for tightrope walking, because I remember his justifiable criticisms in Committee when he said that there was arrogant use of power by the electricity boards when seeking to survey people's land. It was on the evidence of the arrogance of many of the boards, and particularly of some of the minor officials, that criticism was made on both sides of the Committee of the 24 hours' notice. The Paymaster-General has leaned over backwards to meet the wishes of the Committee. Indeed, I am not at all sure that 28 days is not too long; but 24 hours was certainly too short.
I fail to see why regulations cannot be made to compel the area boards—or the Generating Board, if need be—to tell people in advance that they intend to survey the land. There should be compulsion on them to seek a voluntary agreement. There have been cases where they have used their powers without first ascertaining whether voluntary arrangements could be made. Obviously, one accepts the Amendment as it now is, but

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I still think it should be made incumbent, by regulation, upon the area boards or the Generating Board to seek voluntary access before using their compulsory powers to survey an individual's property.
Mr. J. E. B. Hill:I do not want to add to the arguments which were put forward in Committee, but I should like to thank my right hon. Friend for meeting us over the time of notice, and for adopting the period which I suggested. The broad point is chiefly a matter of good public relations, as the hon. Member for Keighley (Mr. C. R. Hobson) has stated, but the longer period is necessary to enable certain changes to be made within a reasonable time—for a crop to be cleared, or even for the weather to improve: in particular, for the occupier or owner of the land to have a chance of fixing appointments with and consulting professional advisers and the like. All these points of possible difficulty are met by the Amendment.
With regard to the notice to owners, I am delighted to know that the Paymaster-General has adopted the suggestion that where, for some reason or other, an owner has not been identified at an earlier stage of the negotiations—as one hopes would normally be the case —a copy of the notice will be addressed to him at the property in question. That will remove a good deal of potential dissatisfaction.
Finally, I should like to thank my right hon. Friend for providing that a copy of the findings of any exploration of the subsoil will be sent to the owner. I think that it is agreed that it would be somewhat inequitable for a public body to have the compulsory right to know more about the subsoil on a property than the owner himself.
Mr. F. H. Hayman: I am a little overwhelmed by the gratitude of hon. Members opposite to the Minister, and particularly that of the hon. Member for Taunton (Mr. du Cann). I have vivid recollections of the Committee being delayed for 2,¼ hours debating this Clause which the Minister had brought forward. Even after the Minister had offered to make concessions, the hon. Member for Taunton, the hon. Member for Honiton (Mr. Mathew), with seven of their hon. Friends, voted against it. They did so even though the Minister, just before the end of the discussion, said:
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"I said that I would extend the period of notice, but that I would have to consider how far I should extend it."—[OFFICIAL. REPORT, Standing Committee D, 14th March, 1957; c. 600.]
They so disregarded the Minister's integrity—[HON. MEMBERS: "No."]—that they were not prepared to trust him.
[HON. MEMBERS: "No."]
We are glad that the Paymaster-General has extended the period of notice to 28 days, because there can now be no real misunderstanding at all, but I think that those who voted in Committee against the Clause even after the Minister had agreed to make concessions, were really wasting the time of the Committee.
Mr. T. L. Iremonger: I am certainly not one of those who detained the Committee for 2¼ hours, and I hope now not to detain the House for more than 2½ minutes. Nevertheless, I want to add my word of thanks and welcome for this reform—
Mr. Hobson: We have more P.P.S.'s than we know what to do with.
Mr. Iremonger: I am not a P.P.S., for the record, but I want to add a word of appreciation, because I was—and I say it without anything but pride—one of those who voted with the Tory Party on this Amendment. Unfortunately, we were defeated by others of our hon. Friends. I am extremely glad to see this sign of grace.
5.30 p.m.
I discussed this matter with the Parliamentary Secretary to the Treasury, vulgarly known as the Chief Whip, and I am glad to see that my consultations with him have borne such a happy fruit. At the same time, I think that I should make it quite clear what my position was, at any rate, in voting against the Clause after my right hon. Friend had given us an assurance. I did not for a moment doubt that he would do as he said, but I felt that if I failed to vote against the Clause as it was printed I would be giving my support to the words "twenty-four hours" which seemed to me to be an affront to the individual rights of British citizens, and I did not want to go on record in the proceedings of the Committee as having supported it.
I thought it necessary to register my protest, and also to emphasise to my right hon. Friend. however silently, that

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I was in no way less sincere and vehement in my feelings of protest than my hon. Friends. I noticed in Committee that the right hon. and learned Member—Newport is the latest of his many political loves for the moment—
Mr. Hobson: That was because of the Government's electoral fiddle.
Mr. Iremonger: With great respect, he was fiddled out of his seat by his right hon. Friends long before that. The right hon. and learned Gentleman used a very interesting and revealing phrase. He said that in the development of modern economy and industry it was inevitable and right that there should be a certain diminution in the intergrity of individual rights.
I can quite see how he comes to that conclusion, and to a certain extent everyone would feel bound to go with him in that direction. But when he said that when individual rights were being infringed in this way the position should be watched very closely, I was not quite satisfied with that phrase. I rather felt that if one of us were standing on the Terrace of the House of Commons and we saw a man struggling in the water and crying for help, the right hon. and learned Gentleman would say that we should watch him closely. I think that something more than a close watch would be called for. I should throw him a lifebelt and see that he was brought safely to the shore.
I think that we should bend our utmost endeavours in this way if there is any slight indication of a lack of respect for the rights of private property, or any lessening of our defence against the infringement of personal rights. For that reason I voted against the Clause in Committee. I am very glad to see that my right hon. Friend has made such a very fine come-back. I welcome this sign of grace and have much pleasure in supporting the Amendment.
Mr. Hobson: Will the hon. Gentleman tell us what the Patronage Secretary told him in the interview to which he referred, in view of the change of policy of the Paymaster-General?
Mr. Robert Mathew: In adding my expression of welcome and gratitude to my right hon. Friend, I would remind the House and, in particular, the hon. Member for Falmouth
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and Camborne (Mr. Hayman) that the points raised in Committee by my hon. Friends included not only the one about the twenty-four hours' notice but the ownership point, which has now been met so generously by my right hon. Friend. In that respect the description given by my hon. Friends was incomplete.
The only other point I want to make is that this House has always guarded the rights of the individual very zealously indeed. However necessary it may be to interfere with those rights in pursuance of the nuclear power programme, the House should do so with the greatest reluctance. For that reason I welcome the Amendment, although if there were any question of it involving the mass production of notices in connection with surveys over a wide area it would he regrettable.
There should not be a presumption of obstinacy on the part of individuals. The procedure should be used only as a last resort. Officials should not try to make their task easier by making a mass issue of notices before making surveys of a certain area. I support what the hon. Member for Keighley (Mr. C. R. Hobson) has said. It is well known to hon. Members that cases have occurred where way leave and other officers have from time to time more than exceeded their authority and have invaded the rights of individuals.
Mr. Hayman: Has the hon. Member read the second paragraph in column 592 of the proceedings in Committee? There the Minister said:
"I have said that we will do what we can, as a matter of administration, about notification to owners."—[OFFICIAL REPORT,Standing Committee D,14th March, 1957; c. 592.]
Mr. Mathew: The point in connection with the owners received only an assurance in very general terms. My right hon. Friend undertook to look into the point about the extension of time and, knowing my right hon. Friend, I at any rate was fully satisfied with it, and I think that I can speak for my hon. Friends in saying that they were also satisfied.
Mr. Nabarro: It would be gracious and generous to thank my right hon. Friend for his movement in the direction of my hon. Friends and myself. This was an important issue in Committee—
Mr. C. R Hobson: This is outrageous.
Mr. Nabarro: —and it is the source of some regret that we are evidently not going to hear from the right hon. Member for Lewisham, South (Mr. H. Morrison) this afternoon, because he is always so zealous in the matter of individual rights and liberties. He should welcome the fact that there are a few true Tories in this House today who do not believe in the over-riding powers—
Mr. C. W. Gibson: Thank goodness there are only a few.
Mr. Nabarro: —of the Executive or officials of nationalised industries. In fact, nine true Tories in Committee voted against the Government. The Clause was agreed to in Committee only with the aid of Socialist votes. Originally the provisions of the Clause required only twenty-four hours' notice to be given, which was quite monstrous. The nine Conservatives who voted on the first occasion and the eight who voted on the second were all in agreement that that was a totally inadequate period.
I asked for a period of three months, and for an independent tribunal to hear an aggrieved person. Three months may be too long, because, as I said on that occasion, I do not wish in any way to impede the development of the atomic energy programme or the extension of energy supplies, notably in rural areas. I think that we can accept twenty-eight days as being a reasonable compromise.
As the Bill still has to go to another place, I would ask my right hon. Friend to consider the possibility of an aggrieved person being allowed, if he so wishes, to have an independent hearing in certain circumstances. I do not think that that is an unreasonable recourse, having regard to the fact that quite considerable acreages of land may be involved, in rural areas. Instead of having these arbitrary powers—which is what we are still vesting with the nationalised authority; although there is now twenty-eight days' notice—we should give an aggrieved person some form of appeal if he still thinks that the local electricity board has acted in an overbearing or arbitrary fashion in seeking entry to his land.
It is not just a question of walking the land. It may well involve the employ-
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ment of heavy boring tackle, jigs, taking lorries on to land which may be cultivated, and so on. It is an important consideration, and one which had a good deal of sympathy from both sides in Standing Committee, that an aggrieved person should have the right of appeal to an independent tribunal, if necessary.
While thanking my right hon. Friend in this qualified spirit this afternoon for moving in our direction—it is the third time that he has moved in our direction on the controversial matters to which the right hon. and learned Member for Newport (Sir F. Soskice) has referred so many times in the last day or two—I ask that this one outstanding matter might be given a second thought in another place.
Amendment agreed to.

Clause 29.—(EXPEDITION OF HIGHWAY PROCEDURE IN CONNECTION WITH ELECTRICITY WORKS.)
Mr. Maudling: I beg to move, in page 24, line 35, to leave out "paragraph 1 of".
It would be convenient, I suggest, to discuss at the same time the following three Amendments, which are all drafting Amendments.
Mr. Deputy-Speaker: Yes.
Mr. Maudling: Briefly, the purpose of the Amendments is as follows. The Committee agreed to an Amendment which we proposed, and which is now in the form of Clause 29, dealing with the stopping up of highways. Its effect was that where planning permission had been granted for, say, a generating station, it might be necessary subsequently for the Minister of Transport and Civil Aviation to make an order stopping up a highway to enable work to proceed.
It was agreed in the Committee upstairs that as the whole machinery of obtaining planning permission would already have been gone through, it was unreasonable to provide, as the 1947 Act at present provides, for three months' notice in a local newspaper, and so on, to give people a chance to make objections. It was agreed that the period of three months' notice might in all the circumstances be reduced to thirty days. The period of three months' notice for publication in the local newspaper is

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contained in paragraph 1 of the Sixth Schedule to the Town and Country Planning Act, 1947.
Clause 29. in its present form, amends that paragraph but it does not amend paragraph 4 of that Schedule, which also contains an incidental reference to the period of three months. Obviously, if we are to reduce the period from three months to thirty days in paragraph 1, we must do the sane in paragraph 4, because the one governs the other. In that sense, therefore, this group of Amendments is consequential upon what has already been decided.
Amendment agreed to.
Further Amendments made: In page 24, line 36. leave out "before" and insert "in connection with".
In line 38, leave out "in sub-paragraph (b) of that paragraph" and insert:
"(a) in sub-paragraph (b) of paragraph 1 of that Schedule."
In line 40, after first "months", insert:
"and (b)in paragraph 4 of that Schedule (which relates to the procedure where an objection is received before the end of that period)." —[Mr. Maudling.]

Clause 35.—(SHORT TITLE, CITATION, COMMENCEMENT AND EXTENT.)
Mr. Renton: I beg to move, in page 26, line 44, after "twenty", to insert "section (Consolidated statements of accounts)".
The House will recollect that yesterday, in the third new Clause, we made a requirement that the Electricity Council should submit consolidated accounts. The effect of the Amendment will be to bring that new Clause into force from the vesting date—1st January next—instead of the date on which the Bill receives the Royal Assent and comes into operation in the normal way.
Amendment agreed to.
Mr. Renton: I beg to move, in page 26, line 44, after "twenty-two", to insert:
section (Supply of electricity to railways)".
This is a similar Amendment and will bring into force as from the vesting date, instead of from the passing of the Act, the new Clause which was the first new Clause dealt with yesterday, dealing with the supply of electricity to the railways.
Amendment agreed to.

First Schedule.—(CONSULTATIVE COUNCILS.)
5.45 p.m.
The Joint Under-Secretary of State for Scotland (Mr. Niall Macpherson): I beg to move, in page 31, to leave out lines 12 to 17.
This Amendment to Part II of the First Schedule, dealing with consultative councils in Scotland, deletes subsection (4) of the new Section 7A which is inserted by that Schedule in the 1947 Act. Subsection (4) provides that
"A person shall be disqualified for being appointed or being the chairman of a Consultative Council so long as he is a member of the Commons House of Parliament…"
but that other members of a consultative council shall not he disqualified from membership of this House. That provision is now inappropriate since neither members nor chairmen of consultative councils as such are to be disqualified from being Members of Parliament by the House of Commons Disqualification Bill. As the House of Commons Disqualification Bill details the offices which render a person ineligible to stand for Parliament or to sit and vote in Parliament, there is now no point in stating in a Statute that a member of a consultative council is not disqualified.
The House of Commons Disqualification Bill disqualifies members of boards. The chairman of Scottish consultative councils will be caught by that provision since they are, in fact, members of am respective boards, although there is no statutory provision which makes them ex officio members, as there is in England and Wales. The proposed Amendment will bring the Scottish code into line with that for England and Wales as the' corresponding provision—Section 7 (3) of the 1947 Act—is being repealed in the House of Commons Disqualification Bill.
Amendment agreed to.

Second Schedule.—(TRANSITIONAL PROVISIONS.)
Mr. Maudling: I beg to move, in page 33, line 26, at the end, to insert:
Machinery for settling employment conditions
2.—(1) This paragraph applies to any agreement entered into by the Central Authority under section fifty-three of the principal Act (which made provision for purposes similar to those of section ten of this Act), being an agreement which is in force immediately before the vesting date.

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(2) Any such agreement relating to any class of employed persons

(a) shall continue in operation on and after the vesting date until it is superseded by an agreement made in relation to that class of persons under the corresponding provisions of section ten of this Act, and

(b) while it so continues in operation. shall, subject to the following provisions of this paragraph, have effect, in relation to any time on or after the vesting date, as if the Electricity Council had been a party to the agreement and as if references in the agreement to the Central Authority were references to the Electricity Council.

(3) In so far as any agreement to which this paragraph applies provides for the constitution of a national organisation (that is to say, a council or other organisation whose functions under the agreement extend to the whole of Great Britain or the whole of England and Wales), the agreement shall have effect, in relation to any time on or after the vesting date, subject to the following provisions, that is to say,—

(a) any power for the Central Authority to appoint members of the organisation to represent the Authority generally shall be construed as a power for the Electricity Council to appoint members to represent the Council; and any member of the organisation so appointed by the Central Authority shall be treated as if he had been appointed by the Electricity Council to represent the Council;

(b) any other power for the Central Authority to appoint a member of the organisation shall be construed as if it were a power for the Electricity Council to appoint such a member, and as if ann., reference in that power to a division of the Authority were a reference to the corresponding division of the Generating Board; and any member of the organisation appointed by the Central Authority in the exercise of such a power shall he treated as if he had been appointed by the Electricity Council in the exercise of that power as modified by this provision

(4) In so far as any agreement to which this paragraph applies provides for the constitution of an organisation other than a national organisation. the agreement shall have effect, in relation to any time on or after the vesting date, subject to the following provisions, that is to say,

(a) any power for the Central Authority. or a division of the Central Authority, to appoint any members of the organisation shall be construed as a power for the Generating Board, or the corresponding division of the Generating Board, as the case may be, to appoint those members;

(b) any members of the organisation appointed by the Central Authority, or a division of the Central Authority, shall be treated as if they had been appointed by the Generating Board. or the corresponding division of the Generating Board, as the case may be.

(5) It shall be the duty of the Generating Board and of each of the Area Boards to
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comply with any agreement to which this paragraph applies, while it continues in operation in accordance with this paragraph.
(6) Subsection (1) of section twenty-four of this Act shall not apply to any agreement to which this paragraph applies.
This Amendment is proposed in pursuance of an undertaking which I gave during the Committee stage in response to points which were put, very rightly, from the other side of the Committee. The position is that the whole question of machinery for settling wages and terms of conditions of work, joint consultation, and so on, was settled by Section 53 of the principal Act; and Clause 10 of the Bill contains the necessary adaptation of the principal Act to bring it in line with current conditions —that is, the substitution of the Council for the Central Electricity Authority.
In Committee, the point was raised by the hon. Member for Cleveland (Mr. Palmer) that there might be doubt about the transitional provisions. The point of the Schedule is to make it quite clear that existing machinery continues until any change is made under Clause 10 of the Bill. I think I shall be in order in saying that in drafting the Amendment we have had the benefit of the advice both of the Central Authority and of the relevant trade union representatives. It should be satisfactory to all concerned.
Mr. Palmer: Once again, we are grateful to the right hon. Gentleman for making this change, which we suggested, and we are quite certain that the trade unions also will be grateful.
Amendmeat agreed to.
Mr. Renton: I beg to move, in page 37, line 14, at the end, to insert:
Activities and expenses of Electricity Council and Generating Board before vesting date
12.—(1) Notwithstanding anything contained in subsection (3) of section thirty-five of this Act, subsection (5) of section two of the principal Act and subsections (1), (6). (7) and (8) of section three of that Act, as amended respectively by Part I of the Third Schedule to this Act shall have effect in relation to the Generating Board as from the establishment of that Board:
Provided that nothing in this sub-paragraph shall affect the operation of those subsections in relation to the Central Authority.
(2) In respect of any expenses incurred or to be incurred by the Electricity Council or the Generating Board before the vesting date, the Council or Board, as the case may be, may require the Central Authority to make such payments to them as the Council or Board

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may certify to he necessary for meeting any such expenses.
(3) All payments made by the Central Authority in accordance with the last preceding sub-paragraph shall be charged to the revenue account of the Authority for the financial year ending on the thirty-first day of December, nineteen hundred and fifty-seven.
(4) All expenses incurred by the Electricity Council or the Generating Board before the vesting date shall. for the purposes of the accounts of the Council or Board, be treated as expenses incurred in the first financial year of the Council or Board; and all sums received by the Electricity Council or the Generating Board by virtue of sub-paragraph (2) of this paragraph shall be treated for those purposes as receipts attributable to that financial year.
This addition to the Second Schedule is needed to ensure that the Electricity Council and the Generating Board are able to do whatever they need to do before vesting date in preparation for taking over from the Central Authority. There will be a period of negotiation between the Electricity Council and the Generating Board which will be appointed soon after the Bill is passed. To enable them to carry out their work properly, they will have to be able to incur expenses. pay their officers, and so on. That is the purpose of the Amendment.
This is how it will work out. Subparagraph (1) ensures that the adaptations made by the Bill in Section 2 (5) of the 1947 Act, which is the subsection enabling the Board to do anything to facilitate the proper performance of its duties; in Section 3 (1), which deals with the incorporation of electricity boards; in Section 3 (6), which deals with the payment of Board members' salaries, and in Section 3 (7) and (8), which enable regulations to be made governing the appointments and procedure of the Board, shall apply to the Generating Board from the date of its appointment.
With regard to sub-paragraph (2), the Electricity Council and the Generating Board are allowed to indent upon the Central Electricity Authority between the passing of the Bill and the vesting date for such funds as they may certify to be necessary for meeting their expenses. Sub-paragraphs (3) and (4) lay down in detail the manner in which these payments are to be accounted for by the C.E.A., the Electricity Council and the Generating Board.
Mr. C. R. Hobson: We have had a very interesting explanation from the Parliamentary Secretary of the need to pay
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these people while the transfer of power is taking place. I have read very carefully the Financial Resolution and I am wondering to what extent the proposed Amendment is in order. The Financial Resolution appeared to be fairly tightly drawn. I should like an explanation as a matter of principle, and I should like to have the relevant part of the Financial Resolution drawn to our attention in justification of what the Parliamentary Secretary is now contemplating.
Mr. Renton: The moneys concerned here will not be coming out of public funds in the strict sense of the word Lind therefore no Financial Resolution is necessary. We need a Financial Resolution when any charge is made upon the Exchequer or upon the public purse, but that does not include the funds of nationalised industries. That is why the matter is in order although it is not covered by the Financial Resolution.
Mr. Hobson: Does that mean that there will be no payment out of the Consolidated Fund?
Mr. Renton: There will be no payment out of the Consolidated Fund in respect of these expenses, which are expenses of the industry. They will be paid by the industry.
Amendment agreed to.

Third Schedule.—(AMENDMENT AND ADAPTATION OF ENACTMENTS.)
Mr. Renton: I beg to move, in page 39. line 30, after "Minister", to insert:
" and (in the case of the Generating Board or an Area Board) to the Electricity Council ".
This Amendment is consequential upon the new Clause which we passed yesterday requiring the Electricity Council to compile consolidated accounts. It will require the Generating Board aid the area boards, when submitting their individual accounts to the Minister under Section 46 (4) of the 1947 Act, to send a copy to the Electricity Council. That is all that the Amendment does; it requires the boards to send to the Council a copy of the reports they make to the Minister.
Amendment agreed to.
Mr. Renton: I beg to move, in page 39, to leave out lines 35 to 49.
This Amendment is consequential upon the first new Clause dealing with the

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supply of electricity to the railways. It removes from Schedule 3 of the Bill the Amendments we originally made to Section 49 of the 1947 Act, which is replaced by the new Clause. The Amendments are no longer necessary.
Amendment agreed to.
Mr. Renton: I beg to move, in page 40. line 26, at the end, to insert

Section 63

After the words "this Act", in the second place where they occur, there shall be inserted the words "or the Electricity Ac:, 1957".

The Amendment will apply the provisions of Section 63 of the 1947 Act, which deals with the service of notices, to the service of notices under the Bill. This is necessary for occasions when an electricity board serves a notice, under Clause 28, of intention to enter land for the purpose of exploration, in accordance with the topic which we were discussing a short while ago.
The service of the notice may be carried out by handing it to the person concerned, or leaving it at his house, or sending it to him by registered post, or, when his name and address cannot be found, merely by affixing it to the premises to which the notice relates.
Amendment agreed to.
Mr. Renton: I beg to move, in page 42, line 47, at the end, to insert:
"The House of Commons Disqualification Act, 1957
In Part H of the First Schedule, for the words "The Central Electricity Authority" there shall be substituted the words "The Central Electricity Generating Board ". and after the words "The Electricity Board for Northern Ireland" there shall be inserted the words "The Electricity Council".
The Amendment is necessary because the House of Commons Disqualification Bill, 1957, which will become law before this Bill receives the Royal Assent, does not refer to membership of the Electricity Council and the Generating Board. I think it will be generally agreed that it would not be proper for Members of Parliament to be members of the Electricity Council or the Generating Board. The Amendment will ensure that they do not become so.
Amendment agreed to.

Fourth Schedule.—(ENACTMENTS REPEALED.)
Mr. Renton: I beg to move, in page 43, to leave out lines 29 and 30 and to insert "Section forty-nine".
This is a consequential Amendment again following upon the first new Clause relating to the supply of electricity to railways. Section 49 is no longer required, so, for the sake of completeness and tidiness, we are adding it to the list of enactments to be repealed.
Amendment agreed to.
5.58 p.m.
Mr. Renton: I beg to move, That the Bill be now read the Third time.
Although a number of changes and improvements of substance and detail have been made in the Bill, its essential character remains the same. On behalf of my right hon. Friend and myself I should like to acknowledge the help which has been given by hon. and right hon. Gentlemen on both sides of the House, and the lively interest shown by hon. Members who have taken part in our discussion. I hone that I shall not be causing offence to any hon. Member. especially on my own side of the House, if I acknowledge especially the constant interest which has been taken in the Bill by the hon. Member for Cleveland (Mr. Palmer), who has attended every one of the many meetings of the Standing Committee and of the House and has scarcely ever been absent from a Sitting. I know that he has done a great deal of hard work in connection with the Bill.
The Bill will come into operation on 1st January, 1958, instead of, as originally suggested, 1st April. My noble Friend will be making the appointments to the Electricity Council and the Generating Board soon after the Bill receives the Royal Assent. Those bodies will then have to start their negotiations with the Central Electricity Authority and, by Clause 23, the negotiations should be completed by 1st November. These negotiations are to decide how the assets and liabilities of the Central Authority are to be distributed between the Electricity Council and the Generating Board. If the parties to those negotiations fail to agree by 1st November, it will be for the Minister to decide how that is to be done, but we hope that they will not fail to

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agree. There is no reason why they should not agree.
The main structure of the industry will be as originally proposed in the Bill, a separate Generating Board, independent area boards, an Electricity Council which, as the Bill now stands, will have a chairman, two deputy chairmen, three other independent members, plus the chairman and two other members of the Generating Board and each of the area board chairmen. We had much discussion in Committee as to the powers and duties of the Electricity Council, and that was the most important matter on which the two sides of the House disagreed, but we have preserved the essential character of the Electricity Council, and it might be convenient if I briefly summarise what that character will be.
In the first place, it will be consultative; in the second place it will be advisory—advisory both to the boards and to the Minister; thirdly, it will provide a number of common services for the boards and those services will now include the payment of Income Tax and Profits Tax on behalf of the industry; fourthly, I should mention that the Council will have no truly executive functions. The only executive function which it will have is one which we hope it will never have to exercise. That is in Clause 17 (7), under which the Electricity Council may give directions to a board which fails to discharge its obligations to make payments to the Central Guarantee Fund.
By inserting what is now Clause 8 we provide a formal procedure enabling the Electricity Council to consider and advise upon disputes between boards. If the Council should fail to resolve any difference which may be referred to it under that procedure it may refer it to the Minister and if he finds a defect in a board's general plans and arrangements he may give directions for removing the defect. I should stress, however, that the Electricity Council is not bound to refer the matter to the Minister, and that the Minister cannot act unless it does so.
Mr. Warbey: Before the hon. and learned Gentleman leaves the question of the functions of the Electricity Council will he, as I understood him to say that, properly speaking, it has no executive functions, say something about the function under Clause 16 of estimating the
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requirements of the boards for borrowed capital and making allocations to them? We understood from the Parliamentary Secretary's earlier description that that would be a quite important executive function.
Mr. Renton: The hon. Member for Ashfield (Mr. Warbey) will remember that we discussed that fairly fully in Committee. As he has mentioned, I gave a fairly long description of it and of how I thought the Clause would work. I noticed during the Report stage yesterday that he referred to it, but, if I may say so, he somewhat misread what I had said. I would invite his attention to cols. 491 to 493 of the OFFICIAL REPORT of the Standing Committee, where he will find what I then said. Quite candidly, I do not think it would be appropriate for me to go over all that ground again.
I would simply say that the boards have the responsibility of deciding upon capital development programmes. It is the boards which have the obligation of letting the Electricity Council know what they will require, if anything, by way of stock, but the machinery for raising the stock and for allocating to the boards what they have said they require will be the responsibility of the Electricity Council. Of course, in all that process there will be consultation on the Electricity Council, and each board's suggestion as to what stock it should receive will be the subject of discussion there. I will not add to that but simply refer the hon. Member to the much more lengthy description that I gave in Committee.
I think that all hon. Members have welcomed the strengthening of the powers of the consultative councils—strengthening in the Bill as it stood and, to a lesser extent, since it was introduced. I should point out that we have added to Clause 12 provisions which will now enable the consultative councils to consider the complaints of individual consumers with regard to what are called special agreements. That was the suggestion of my hon. Friend the Member for Clitheroe (Mr. Fort).
Perhaps the most vital Clause in the Bill is Clause 11, which confers the: duty upon each board of paying its own way, taking one year with another. Hon. Members, especially those from the South-West Area of the country, expressed

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concern about the effect of this on rural development. I speak as a Member representing a rural constituency, and wish to say a little about the view which the Government take of the effect that the Bill will have upon rural development. because that is a most important matter.
After the Resolution of this House in June, 1953, the Central Authority and the area boards entered into the Morton hampstead Agreement. That Agreement provided for assistance to be available from central funds for any board which was unable to take its share of the programme then announced. The programme announced was for the connection of 57,000 farms in five years, ending in April next year, 1958. Another way of expressing that programme was that it would by that date bring electricity to 70 per cent. of the farms of the country. The Morton-hampstead Agreement also provided for a per cent. of farms to be connected in the next five years. but did not apply that 15 per cent. to all the boards. There were two or three boards which, it was felt, would not be able to add a further 15 per cent. in five years and one of those boards was the South Western Area Board.
I should also mention that the South Western Board, as hon. Members will know, was the only one to receive a subvention from the central fund. What has happened as a result of the agreement so far? The first five-year programme has gone ahead much better than anyone expected it would, and the national figure of 70 per cent. of farms to be connected should be passed this autumn.
Mr. C. R. Hobson: On a point of order, Mr. Deputy-Speaker. Is it in order on Third Reading to discuss what is not in the Bill.
Mr. Deputy-Speaker: No it is not.
Mr. Renton: I did hope that it was in order to discuss what was the view of the Government about the effect of the Bill, and particularly the effect of a Clause in the Bill which places a particular responsibility on the area boards. Of course I am in your hands. Mr. Deputy-Speaker.
Mr. Deputy-Speaker: I did not stop the hon. and learned Gentleman. I was asked whether it was in order to discuss
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what is not in the Bill and I said that was not in order, but that is all that I said.
Mr. Renton: I hope that I shall not be transgressing if I conclude what I have to say about rural electrification. It might be of some convenience to the House if some latitude were allowed to me.
Some boards, including the South Western Area Board and the Eastern Area Board, have already, within four years, completed their five-year programme. Therefore, the prospects for the second five years are excellent, especially, I should say, for the South-West because it has done so very well. The Government have decided that when the Central Electricity Authority's central reserve funds are divided, as they have to be under the Bill, the Electricity Council should give special consideration to those boards which have particular difficulties, including difficulties arising from rural electrification in remote areas.
Therefore we are confident that the boards can carry their own burden. In saying this I should emphasise that the agricultural community generally needs electricity at times other than those of the peak urban and industrial loads; so that expanding the period of the full use of the capital invested in the industry will help to keep down the general cost for all consumers. Each type of consumer, therefore—
Mr. David Jones: Will the hon. and learned Gentleman give way?
Mr. Renton: May I finish my sentence? I wish to conclude this point, because it is important.
Therefore, I say that each type of consumer has an interest in promoting rural electrification, and we consider it is quite proper that some of the capital cost should be borne, as it has been in the past, by users as a whole.
Mr. Jones: Is the hon. and learned Gentleman now telling the House that, while the principal reason for introducing this Bill at all was to decentralise power from the centre to the area boards, the Government apprehend that the consequences of what they are asking is that the division of the available reserve fund will be more generous to those boards

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which will meet with difficulty, in spite of the fact that the reason for introducing the Bill was that no difficulties would arise?
Mr. Renton: That would certainly not be a fair interpretation of what I have been saying, or of the intention of the Government. With respect, I would say that had the hon. Gentleman heard a little more of the earlier discussions, he would not have made that intervention.
In other words, as my noble Friend said recently in another place, in general, the cost of rural electrification should fall on the whole body of consumers. My noble Friend was referring to consumers of electricity generally within each area, but we have always made it plain that under this Bill we do not consider that the consumers in any one area should be subsidised by consumers in the rest of the country. That is the point.
Mr. Palmer: I have no objection to what the hon. and learned Gentleman is saying, but I am rather surprised that he is going into such detail about this point unless he has a guilty conscience about it. Would the hon. and learned Gentleman say that the South-Western Electricity Board is happy about its future? Is it not a fact that it will have to use much of the central reserve fund for its own reserve purposes?
Mr. Renton: That will be a matter for the Board to decide. The hon. Gentleman asks whether the South-Western Board will be happy about its future. All I can say is that the board is very much happier now than it was a few weeks ago when there was a certain amount of discussion between some members of the board and hon. Members on both sides.
Mr. Hobson: On a point of order, Mr. Deputy-Speaker. I fail to see where there is any question of the South-Western Board in the Bill. If this latitude is to be allowed to hon. Members, it will make for a lengthy discussion during this Third Reading debate.
Sir Harold Roper: Further to that point of order. Is not this matter relevant to Clause 7, which gives the Minister certain powers of direction? I feel that this matter may well be dealt with under the provisions of Clause 7 and that therefore, Mr. Deputy-Speaker, you might regard it as relevant.
Mr. H. Morrison: Further to that point of order. Regarding the last point made by the hon. Member for Cornwall, North (Sir H. Roper), may I submit that were it conceded, the Minister could talk about anything under the sun relating to the electricity supply industry.
May I also submit to you, Mr. Deputy-Speaker, that the job of the Minister, surely, is to ex plain the provisions of the Bill and his remarks should be confined to what is in the Bill? What the hon. and learned Gentleman is saying is not so much an explanation of what is in the Bill as an exposition of the administrative policy of the Ministry, and of what was the Central Authority which now, unhappily, is being abolished. His would be a very nice speech on a Supply Day but not on the Third Reading of this Bill. I understand his motive, which is to provide propaganda for the rural constituencies. But it is his job to expound the provisions of the Bill and not to engage in propaganda, or describe the administration of the Ministry and the Central Authority.
Mr. Deputy-Speaker: I have always understood that the rule on Third Reading is that one can deal only with what is in the Bill. Of course, in doing that, T think it reasonable to go on to say what the Bill will do.
Mr. Renton: May I put it in this way? Clause 11 of the Bill requires area boards to stand on their own feet financially. Anxiety has been expressed during the passage of the Bill through the House about the effect of that provision upon the development of rural electrification—a matter which, under a part of the 1947 Act not repealed, is a duty that will be upon the industry in the future. As we are now legislating for the future of the industry, I should have hoped that this subject was in order.
We have no doubt that the completion of the programme of rural electrification announced in 1953 will take place—
Mr. Hobson: On a point of order. We are debating the Third Reading of this Bill and now we are having an exposition of rural electrification from the hon. and learned Gentleman. Does that set a precedent which subsequent speakers may follow?
Mr. Speaker: I have just come in and have heard only a few words by the Parliamentary Secretary. If what he is saying is a description of the effect of the Bill upon the subject, that would be in order, but I must be permitted to hear a little more before I pronounce on it.
Mr. H. Morrison: Further to that point of order. What the hon. and learned Gentleman is doing—it is within the recollection of hon. Members—is expounding what has been, and what is, the programme of rural electrification, all of which happened before the Third Reading of this Bill. Therefore it cannot be related to this Third Reading debate. Moreover, if the hon. and learned Gentleman were impartial, he would give credit to the Labour Government.
Mr. Speaker: I should like to hear a little more of how the hon. and learned Gentleman connects this matter with the Bill.
Mr. Renton: May I summarise the position by saying that we do not consider that Clause 11 of the Bill will have an adverse effect upon the rural electrification programme announced in 1953.
The only point I wish to add is that under Clause 3 (3) it will be the duty of the Electricity Council to watch rural electrification, and all other important developments for which the industry is responsible, and to advise the Minister about them from time to time. My hon. Friend the Member for Cornwall, North (Sir H. Roper) intervened to suggest that under Clause 7 the Minister would have the right to give directions. I would simply say that in the ten years of the industry's history no directions have, so far as I am aware, been given at all about matters of a general character affecting the public interest. We hope that the industry will assume its responsibilities and at the same time exercise its commercial judgment in a way which will enable its functions to be carried out without the Minister having to intervene.
That is all I wish to say about rural electrification. Since this Bill was introduced the nuclear power station programme has been announced, and we hope that this Measure may help the electricity supply industry to carry out that programme effectively. My right hon. Friend will be glad to reply to any points which hon. Members may wish to raise.
6.20 p.m.
Mr. Palmer: May I first thank the hon. and learned Gentleman the Parliamentary Secretary to the Ministry of Power for the very kind reference he made to myself? Having said that, I must say that I rather regret that he did not direct his remarks more closely to the subject of the Bill, because there were a number of interesting controversies in Committee and on Report which I should have thought were appropriate for discussion now.
It is certainly my intention, as far as I can, to confine my remarks to the general purposes of the Bill, as I understand it, but before doing so I think that I should say a word about the attitude of hon. Members on this side of the House towards the Bill. When it appeared, we discussed it through those processes of party democracy which we use on this side—and which are rather different from the kind of party democracy which we have had described for us in the columns of the Manchester Guardian as operating on the other side.
We were anxious to decide the correct attitude to the Measure. We could, of course, have said that since it was brought in by a Tory Government our attitude should be straightforward, root-and-branch opposition. There were two reasons for our not adopting that attitude. The first was, perhaps, a philosophical one while the second reason—or set of reasons—was intensely practical. I will, if I may, deal shortly with the philosophical point first.
It can be said that we on this side are democratic Socialists and therefore look on society as being in a process of continuous evolution, on occasion according to laws of its own as well as by the conscious political acts of those of us who will changes through legislative processes. The essence of our democratic socialism is that society must evolve. When we socialised this industry, as we did by the 1947 Act, we transferred it from private hands to the whole of the democratic nation. Once the change is made, and once the great parties of the State accept that change as being permanent, it seems to us reasonable that all parties can play a part in improving the actual organisation in the light of experience.
We felt that we should look at the Measure strictly on its merits. That is

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not to say that, on occasion, when changes affecting nationalised industries are brought in by the, we hope, short-lived Governments of the other party, we shall not quarrel about the merits or details of those changes. As an Opposition, it is our duty to do so. However, I do not think that we should necessarily resent attention being given by any Government to the problems of the organisation and control of publicly-owned bodies, provided—and this point I cannot overemphasise—that the principle of public ownership is not in question. Had it been in question in this case I have not the slightest doubt that my right hon. and hon. Friends would have fought the Bill relentlessly.
The second set of reasons which determined our attitude come under the heading of the practical. There are practical justifications for the Bill. First, there was the Herbert Report which we have looked at in great detail both in Committee and in the House. The investigation by the Herbert Committee is the first examination we have had of the problems of a nationalised industry by an outside, impartial committee. It was the kind of occasional inquiry which has already been mentioned this afternoon, a kind of check on the efficiency of a nationalised industry which was suggested by my right hon. Friend the Member for Lewisham, South (Mr. H. Morrison)—a most practical and useful suggestion, if I may say so. I will come to the merits of the inquiry in a moment.
Further, some of us on this side of the House take a great interest in the everyday problems of the nationalised industries, and we had some knowledge of this electricity supply industry and its needs. Also, I think that we took into consideration the fact that the country is now embarking on a great programme of nuclear energy development, and it is useful that we should now have one functional Generating Board which can, in an uninhibited way, look at the practical technical problems of nuclear energy for power purposes. Those are the practical aspects that operated in our minds when we looked at the Bill and decided our view.
Most electricity supply legislation has been preceded by some kind of impartial inquiry. The 1919 Act was preceded by the Williamson Report, the 1926 Act by the Weir Report, and the 1947 Act was,
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in a sense, the result of some recommendations made by the McGowan Committee. The Report of the Herbert Committee, on which, in a sense also, this Bill is founded, was cogent in argument and lucid in style. Even Members of Parliament could understand it, and that, I think, is going quite a long way.
That Report was not necessarily right in every conclusion, and the Government have done what I think they had the right to do. They have accepted certain conclusions and rejected others. On this side we have taken the same view. We have had our varying opinions upon the merits and demerits of the various parts of the Report. We have been, according to our ideas of correct public policy, selective in our approach, and I can think of nothing wrong in that. As my right hon. Friend said earlier, outside Committees make recommendations, but it is the business of Ministers to decide which of the recommendations they will accept and which they will reject.
From the discussions in Committee there has emerged—in spite of the general acceptance on this side of the broad principle of the Bill—a recognisable pattern of difference between the two sides. I do not agree with what the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) said, I think it was yesterday, that Socialists, by their nature, stood for centralisation—and Tories, I suppose it followed, stood for decentralisation. That is much too simple, too much of a generalisation, and it does not, in fact, fit the facts.
Had we stood for centralisation in relation to this Bill—the effect of which is generally accepted to be greater decentralisation we should certainly have voted against it. Also, if we on this side of the House stood automatically for centralisation in public ownership we should never have introduced the 1947 Act in the form we did, because that Act already gives a measure of decentralisation to the area electricity boards. It seemed to me that the divisions between us which emerged upstairs were not over decentralisation or centralisation as a principle, but were concerned with which particular functions should be centralised and which should be decentralised. On that, there was a quite legitimate and proper difference between the two sides.

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In human organisation, there are certain things which can be dealt with locally by the man on the spot and there are other things which must be decided at higher level, as a matter of broad policy. This is a difficulty inherent in human affairs which has come down to us through the ages. Those of us who try occasionally to study the history of military campaigns notice, for instance, how this problem and difference crops up time after time. It springs, I believe, from the very nature of human affairs. Emotionally, I rather fancy that most of us, who are good democrats, have a bias towards decentralisation. I certainly tend automatically to resent the large organisation. It is an emotional feeling; but, in life in a real world. the issues must be looked at on their merits.
Both sides were united about the centralisation of certain things. For instance, in respect of generation and bulk transmission, the wholesale side of the industry, the Bill puts a new Board in charge; but generation and bulk transmission remain centralised. Again, both sides were united about the need for decentralising distribution. We have in fact carried rather further the principle already contained in the 1947 Act, that the area boards are now to have financial responsibility to balance their accounts, managing their affairs financially, taking one year with another. That is the retail side, and on that issue of decentralisation as opposed to centralisation both sides were at one.
The differences arose mainly, I think, over financial control. For instance, we on this side of the House said that capital allocation must be—and here we were with the Herbert Committee—decided by the Councillor, if not by the Council, then by the Minister himself; we thought that it should not be left open. Again, there was a strongly marked difference of opinion between the two sides over the bulk supply tariff. We said that the bulk supply tariff was a key to the financial success or otherwise of the area boards, and if they had to pay too much for their electricity, or if unreasonable terms were imposed upon them by the Generating Board, they would be in deep water financially and the Clause of the Bill which puts upon them the responsibility to balance their own accounts would not
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have the validity one would hope for it. These are not matters of principle but matters of judgment or of fact. As to who is right about them, I suppose that, in the end, only time will indicate, if time does in the end indicate anything at all.
There were other parts of the Bill about which there was very real controversy. I was glad that the Parliamentary Secretary—though I thought, with respect, that he went on much too long—refereed to rural electrification. There was certainly a long debate in Committee on rural electrification. We then took, and still take, the view that the Government were running away from the need to electrify the countryside and to bring the advantages of electricity to every part of the country; but they do not want to admit it because of the political difficulties it would cause them in rural constituencies.
Another controversy, which has been quite violent at times and which we experienced again yesterday, centred upon the right to manufacture. As we see it, the Minister has weakened his Bill in this respect. He has surrendered to his more extreme, doctrinaire supporters, who have seemed in the last few months keen to kick the furniture about before they, as tenants, are evicted by the electorate. These are differences which are really not of organisation but of emphasis and public policy. We certainly have not lacked keen debate on these issues.
We on these benches have been genuinely anxious to improve the Measure, and, I would at this time like to express our thanks to the Paymaster-General. Quite a number of Opposition Amendments have been accepted, some in principle, having been redrafted since Committee stage. There is a fairly long list of them. First, we felt that the right of area boards to generate should be somewhat curtailed; and that has been done. The composition of the Council has been altered, in response to representations and suggestions we made; we are very glad about that. We wanted a consolidated statement of accounts; we are to have that. We are now to have one comprehensive annual report—a very great improvement in the Bill.
As to joint consultative machinery, there were discussions with the trade unions, and the provisions of the Bill have been brought into line with the suggestions made by the trade unions, We

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have today dealt again with compensation to employees, and an Amendment has been accepted. Also this afternoon we have dealt with the continuation of trade union agreements. A subject in which I am particularly interested, because I follow these matters a little in the industry, is education and training. We have done something in the Bill to bring education and training in the industry into the general sphere of joint consultation. The right hon. Gentleman and his hon. and learned Friend have been courteous throughout and, certainly on these points at least, accommodating. I would, however, suggest that it is the Bill, the future Act of Parliament, which has gained from the suggestions we have made.
These battles are now behind us. They may be continued—I do not know—in the rather tranquil atmosphere of another place. As my final word I should like to say—and I am sure I take the whole House with me in this—that, although we in Parliament can legislate for good or for ill, practical creation in human success and endeavour is with the workers, the technologists, and the managers of this enterprise outside. We can legislate, but we cannot go beyond. Let us hope that, through this Bill when it eventually reaches the Statute Book, we shall have assisted the great work that these employees of the industry do in providing electric power for the nation.
6.38 p.m.
Mr. du Cann: I want to refer to one matter only, the effect of Clause 11 upon rural electrification. As everybody knows, rural electrification is becoming increasingly difficult because the easiest properties have been dealt with. The more remote farms and more difficult or inaccessible villages have now to be tackled. In total, looking at the country as a whole, something like two-thirds of the job has been done and one-third remains to be done.
Clause 11, as we know, puts the obligation for financing the whole of the work upon the area boards themselves. In my view, it is absolutely proper and right that that should be so. I do not believe that it will drive up the price of electricity for those boards which have particular problems except by a very small amount indeed. It is well worth bearing in mind in this context that some boards have all manner of other problems besides rural
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electrification which involve large amounts being spent in capital development. Reinforcement is an example.
There is some possibility that area boards with these special problems, in particular the problem of rural electrification, may be helped by the provisions of the Second Schedule, paragraph 6, when the distribution of the present central reserve fund, to which my hon. and learned Friend has already referred, is considered.
I want simply to ask my hon. and learned Friend to be good enough, as I am sure he will, to bear in mind a particular matter in this connection. As a rural Member, it seems to me more than likely that the rural development charge will have to increase. It should be borne in mind that it is not only a question of bringing electricity to farms in the rural areas. When talking of rural development, one tends to think first and foremost of farms, and that is, perhaps, right, but there are many other rural premises—cottages and so on—besides farms. Many people, such as the baker and the grocer, serve the farmers in these areas. Farmers can get grants under the Hill Farming Acts or, in the future, under the Agriculture Bill, but those other people cannot get any of these grants.
For the future, one needs to watch the situation which is likely to exist if the rural development charges go up. This may well mean that some people who have been looking forward to having electricity—and we must not forget that people living in isolated parts of the United Kingdom, like Exmoor, have few amenities—may not be able to have it. It would be a great pity if the rate of rural electrification were slowed down in any way. I know that my hon. and learned Friend, as he has said, has this matter very much in mind, but when considering the distribution of the central reserve funds, it is a point which should be borne particularly in mind.
6.42 p.m.
Mr. H. Morrison: I wish to speak only for a short time on Third Reading, and particularly concerning one aspect of the Bill. Once again, I agree with my hon. Friend the Member for Cleveland (Mr. Palmer). I know what a great interest he has taken in electrical matters for a good many years. I agree with him that one must not assume that because we have transformed an industry from a mix-up

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between public and private ownership, as was the case in this industry, and make it a coherent national undertaking with area organisation, we should never examine it to see whether the set-up, the structure or the administrative system is right or whether there is undue centralisation.
I agree with my hon. Friend in that respect. My bias is also for decentralisation, although we might have to consider now and again whether there is undue decentralisation. Personally, however, I would give the benefit of the doubt to decentralisation. One of the things I did at the Ministry of Home Security was to send a Minute to Whitehall civil servants to say, "We will never do in Whitehall what can be done in the regions." I am sure that that is a right principle on which to act.
I would say the same of electricity and other forms of public ownership, including transport, that where we can conveniently decentralise it is right to do so. Some of the provisions in the Bill in that respect are right. Therefore, it is right that we should have had the Herbert Committee and should have asked it to look at the set-up, the administration, management and organisation in a broad way to see whether there were any changes that that Committee would recommend. I emphasise, however, as my hon. Friend has said, that no matter how high a regard we may have for the Members of that Committee, we are not obliged as a result of that investigation to agree with everything that the Committee recommended.
There are some things which have come into the Bill that we do not like. We do not like the limitation which the Government have put upon the manufacturing powers of these public authorities. I do not say that the Government should have gone mad with the use of the manufacturing powers, but it is desirable that these public authorities should have them, particularly in regard to some of the Reports of the Monopolies Commission. I should have thought that it was a necessary safeguard for the public interest. The trouble with the Government is that they have an inferior regard for the public interest and an exaggerated regard for private interest. Therefore, they have put in this provision. There are other things too that I do not like.
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There is one rather important point upon which I do not agree with my hon. Friend the Member for Cleveland. Presumably, the Labour Party must have considered all these things at a time when I happened to be abroad, when it came to its own conclusions and I was not here to help in arriving at those conclusions. I am sure that nobody will object if I put this point of view about the action of the Government in the Bill in abolishing the Central Electricity Authority and taking away the generating functions from the Central Authority, including the new Central Authority, and setting up a further element of management: namely, the Generating Board.
I always thought that one of the boasts of the Conservative Party was that it was opposed to the multiplication of administrative machinery and the finding of jobs on public hoards. Here, the Government are finding a new bunch of jobs on a new public board. They have removed the generating function from the old Central Authority and are putting in a special board of its own. One does not want to break up the whole national generating functions.
My doctrine of public administration in this respect is never to leave a Minister or an organisation, if one can avoid doing so, with nothing to do. Do not leave it up in the air. I always thought that the Ministry of Town and Country Planning, which once existed by itself, was all the better when it became the Ministry of Housing and Town and Country Planning and, later on, something else and Planning. if it is left with town and country planning alone, people can get rather a little bit far removed from the daily life of the world. It is a good thing to mix them up with bricks and mortar or something physical so that they are handling things, doing things and administering things, as well as the making and settling of plans, important as that is.
The Central Electricity Authority had contact with the area authorities. There was a great amount of delegation to the area authorities, and if more was wanted it could have been provided for. I would not in any way object in principle to that being examined.
The Central Electricity Authority also handled the generating side of the industry. The generation of electricity s apply is largely an engineers' job. It is highly

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technical, but it needs thinking about and it needs planning over a period and a considerable degree of thought. I should have thought that it was a good thing that the generating side should have been associated with the Central Authority and a good thing for the Central Authority that it should have something physical and of importance to do.
Having abolished the generating functions of the Central Authority and set up an additional board, the Government are then in the difficulty of what to do with the residual powers of the old Central Electricity Authority. They have, therefore, created a central Council. The Parliamentary Secretary said that it is to have practically no executive functions—at least, he hoped that it would not execute anything.
This is a poor sort of boast that we should deliberately create a body with no executive functions. That is not a healthy life for any authority. It is a miserable boast that the Government are to see that it has no executive functions. The result will be that those people will have to find something to do. The temptation will be for them to buzz around with all the other numerous electricity authorities, including the Generating Board, and see whether they cannot find something for idle hands to do. It seems to me to be a waste of effort and a waste of money. It does not seem to be fair to put important people on a central council and then in effect deny them having important things to do, except this list of rather unimportant things.
It is no good bringing in the analogy of the Gas Council. The gas industry is quite a different order of things. There, we have not the great transmission system of the national grid. Whether the gas industry will ever get to that stage, I do not know. There it has been right to base the essential part of the industry on the areas. It is something like the Constitution of the United States where the States are supreme and not the Federal Government. In the case of gas, we established the area gas boards and merely set up the Gas Council for consultative and coordination purposes.
The analogy with the Gas Council breaks down because, in electricity, we have the generating and grid system. Therefore, I regret the change which has been made. I do not think it is for the
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good. It is rather by the long-haired and theoretical that this has been done. The Bill would have been better had it not been done, but whether there would have been much left of the Bill had it not been done I do not know.
I think it is a great pity in public administration to cut off the doing of things—physical administration—because that in turn improves the responsibility and quality of the general administration. But there it is, and I can only hope that the Bill will not do much harm. I think that is a very bad fault in the Bill, and I am sorry that the Government accepted that recommendation.
6.53 p.m.
Sir Harold Roper: I want to say a word or two on one point only following on what my hon. Friend the Member for Taunton (Mr. du Cann) said. That is the effect of Clauses 1 and 11 of the Bill, which withdraw the means to continue financial assistance for rural electrification from a central fund.
I was a little disappointed with my hon. and learned Friend's reply in that I did not find in it quite the assurance that I would have desired in thinking that we could rely on his support to ensure that rural electrification would go ahead. He expressed the view that it would go ahead under the terms of the Bill as it stands, but I would have preferred something a little more positive in his approach.
Like my hon. Friend the Member for Taunton. I come from the South-West Area, which is a special case in that the need there is greater than in other areas. We have so far achieved only 55 per cent. electrification of our farms, and that has been carried out largely at the expense of the rural consumers in the South-West Area. There is no question that the South-Western Electricity Board in the past has relied to some extent, may be a small extent, on the finance which it has received from the central fund. It was relying on a continuation of that financing.
The cost of reaching these farms is high. As time goes on they become more and more scattered and remote, costs rise, and their incidence on the urban consumer tends to become greater and greater. The recommendation of the Herbert Committee is accepted in the Bill —it would be out of order for me to

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reopen that question—but the Herbert Committee went further than that. It expressed the view that such issues as subsidisation of rural extension should be dealt with as an act of policy by the Government, and I should have appreciated a word from the Minister on that point.
In an intervention, I suggested that the matter might be dealt with under Clause 7 of the Bill. I did so because that is a Clause under which the Minister is empowered to initiate action. His reply was—and again I was a little disappointed —that it could be covered by Clause 3 (3), which places upon the Electricity Council the function of making recommendations. I feel that this is not a matter to be dealt with from purely a commercial point of view. It is one where one would like to see the initiative taken by the Minister.
It is the Herbert Committee's conception that rural electrification is not to be regarded purely as a commercial issue. It should be treated as a matter of policy by the Government whether, for instance, a social desirability is involved. I think that we all agree, when we see the hundreds of millions of pounds being paid out to keep our agricultural industry in a prosperous condition, that it is illogical to take a narrow view in treating the supply of electricity purely on the basis of commercial justification. There is nothing more important in the rural districts. It is a matter requiring positive action by the Government. I may be out of order, Mr. Speaker, in commenting on what is not covered by this Bill, but I am a little disappointed that the Minister cannot give us a more definite assurance.
6.58 p.m.
Mr. Warbey: We have had an interesting time following the Bill through the legislative machine, and we have made a number of improvements in it, although, as the Irishman said, some of the improvements have been for the worse. Not the least interesting part of our discussions have been those which have involved skirmishes between the different political philosophies of the two sides of the House.
As this is the first Bill involving a major reconstruction of a nationalised industry, it was inevitable that some hon. Members opposite should take the opportunity which it afforded to try to wreck.
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so far as they could, the nationalisation principle, if they could not rationalise the industry out of existence. We have also had an attempt on the part of the Minister and the Parliamentary Secretary to justify certain Clauses in the Bill on general theoretical grounds which have turned out, on examination, not to hold water. We shall, no doubt, have an opportunity on other occasions to revert, for example, to the theoretical consideration which the Paymaster-General has advanced in support of his contention that in principle nationalised industries ought to raise their capital in the same way as private industries.
The right hon. Gentleman's theoretical justification for that was that the criterion by which we should judge whether capital investment was a good thing was the return on the invested capital. That, of course, is a criterion which we on this side of the House could not possibly accept. I doubt whether the Paymaster-General himself, on reflection, would accept it in practice. I should have thought that he would not accept the view that one should judge our defence programme expenditure, on guided missiles and the hydrogen bomb, on that basis, because there is very little financial return from that capital investment. The same applies to our education programme.
Presumably, however, the right hon. Gentleman would like to judge by that test the importance and the success, from the point of view of public policy, of the nuclear power programme for the generation of electricity under the Bill. It would be a completely wrong test to apply. The right hon. Gentleman knows that if we are to have any kind of public planning at all that test falls to the ground completely.
We have just had another example, illustrated by the speeches of the hon. Member for Taunton (Mr. du Cann) and the hon. Member for Cornwall, North (Sir H. Roper) of how, once more, Tory philosophy, as enshrined in the Bill, does not work. In decentralising the structure of the industry, through the Bill, the Government have also tried to decentralise its financial operation and, following their philosophy, they have put Clause II in the Bill and have got themselves into all kinds of difficulties as a result.

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The Parliamentary Secretary made a soothing speech about rural electrification. He tried to claim that Clause 11 would not hold up rural electrification or make electricity more expensive to consumers in rural areas, but he did not succeed in convincing either the hon. Member for Taunton or the hon. Member for Cornwall, North. He certainly did not succeed in convincing my hon. Friends, including the hon. Member for Falmouth and Camborne (Mr. Hayman). In view of the provisions in the principal Act in this respect, ways and means will have to be found of getting round the principle enshrined in Clause 11. Although the Minister has rejected the method which we on this side of the House have advocated, some other methods must be found.
Again, I thought that I detected in the Parliamentary Secretary's reply to an earlier interjection by the hon. Member for Cornwall, North a further implicit reflection of Conservative philosophy when he almost expressed horror at a suggestion that the Minister, in practice, would make any use of powers contained in Clause 7 (1) to give directions to the Electricity Council and the boards. He made what is, of course, a purely technical point that directions are rarely if ever given, but he knows very well that the whole purpose of subsection (1) and of the Clause as a whole is to ensure that the nationalised industry is carried out in conformity with public policy.
In practice, there are consultations, in the course of which the Minister privately indicates his view to the units governing the industry. That view, having gone through a process of discussion, is then generally expressed in decisions which are apparently independently taken by the governing bodies of the industry. The Minister, in that case, does not have to make a direction, but it is entirely wrong to suggest that this is a purely negative function and that the Government can sit back and do nothing, letting the industry run entirely by itself with the Government having only reserve power to intervene in the last resort should the industry appear to be diverging in a major degree from the public interest.
We on this side of the House regard the powers in Clause 7, like similar powers in our own 1947 Act, as being a
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vital part of our conception of the way in which nationalised industries work. I beg hon. Members opposite to appreciate that we nationalise industries not because we have any particular grudge against private enterprise but because we believe that it is only by bringing those industries under public ownership and control that we can ensure that they serve the public interest and that great fundamental industries like that of electricity supply are conducted in conformity with the general national interest.
Here there is a conflict of view. There was a time when we thought that the Conservative Government would continue the general line of policy which the Labour Government had instituted in this matter. But we have seen that they have begun to run away from it and to abandon the concepts of national planning in favour of a free-for-all. We hope that they will not do that with the electricity industry. We hope that they will ensure that national planning is carried out in terms of public policy.
I thought that the statement made by Lord Mills in another place a day or two ago on the nuclear energy programme indicated that the Government had now arrived at fairly firm ideas about how the generating programme of the industry should be conducted over the next ten years or so. Those ideas are embodied in the programme announced by the Minister, about which we arc shortly to have a White Paper.
That process is certainly not arrived at by the Minister talking and doing nothing. It can be arrived at only by the Minister taking a very active part indeed, exercising to the full the powers given to him in Clause 7, and ensuring that all our energy resources are used and expanded in the national interest, and that the capital investment available in the country is allocated not in accordance with what would be the largest capital return but in accordance with what would be of the greatest benefit to the greatest number in the community.
7.9 p.m.
Mr. Hayman: Most of the Bill, which has now reached its final stage, is occupied with the Government's decision to abandon the Central Electricity Authority and to transfer its powers elsewhere. The House having reached

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that decision and the Bill having reached this stage, we must accept it, but we ought to put on record our appreciaiton of the work done by the Central Electricity Authority and by the area boards up to now.
This has been a nationalised industry and these bodies have had to undertake the immense task of re-organising the industry from a mass of private firms and local authority undertakings. As the Herbert Committee's Report said, they did this work most efficiently. A great debt is due to the staffs and workmen of the Authority and of the area boards.
We are glad that the Minister, in the course of our long discussions in Committee, saw fit to grant us some substantial concessions. I should like to put on record my appreciation of the flexibility he has shown towards us and our arguments, even though he did not accept all that we put forward. I refer, in particular, to the composition of the Electricity Council and to the general appreciation shown throughout the Bill of the excellent work done by the consultative committees throughout the country since the industry was nationalised. They have been given additional powers which I am sure will be justified, and I believe that the Minister will be glad that this has been done.
I suppose I have said too much about rural electrification already, but it is important. Even now 45 per cent. of the farms in the South-West which could take electricity have not been electrified. I say again that the main cost of rural electrification will fall upon the big cities of Bristol, Plymouth, Exeter and upon the town of Torquay. They have carried a great burden up to the present because, when the tariff was unified some years ago, they had to bear a steep increase. In spite of Clause 11, under which the area boards must finance all their schemes of rural electrification, I am sure that the 45 per cent. I have mentioned will never be dealt with in that way, but that is something which remains to be seen.
The hon. Gentleman the Member for Taunton (Mr. du Cann) said that it is not only farms in the countryside which need a supply of electricity but also the houses of other people who live there. During the Committee stage I drew attention to the fact that in one small hamlet
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in my constituency each tenant of twelve council houses was called upon to find £42 for the connection charge as well as having to pay all the subsequent ordinary charges. Since we have electrified the best parts of the areas, the further parts will prove an increasing liability, and the further charges on the ordinary people of the countryside will become much heavier. This will impede the completion of rural electrification.
In spite of all the propaganda of the party opposite in the country, in which they refer to nationalisation as an awful bogy which will bring great disaster on us, they themselves have brought to its final stages in this House a Bill which continues a great nationalised industry. I am sure that they, as well as we on this side of the House, realise that the electricity industry will continue to be efficient, and that we can look forward to a continuation of excellent work from chose who serve it from top to bottom.
7.15 p.m.
Mr. C. R. Hobson: Now that we have come to the closing stages of the Bill, I think we can all say that this Measure for the setting up of an electricity industry cabinet, which is really what it does, has had an easy passage. This was largely because, on its Second Reading, it was apparent that it would be an agreed Measure.
We all regret the absence of the hon. Member for Kidderminster (Mr. Nabarro), whose ebullience certainly livened the proceedings in Committee. It would not have been too bad if the hon. Gentleman had left it at that, because we always enjoy a little light relief. The unfortunate thing about his presence on the Committee, and the entourage which he was able to gather around him, was that it resulted in the Minister being compelled, because of that pressure group, to weaken the Bill. I propose to say something about that in a few minutes.
I want to refer now to the speech made by the hon. Member for Cornwall, North (Sir H. Roper) about the South-Western Electricity Board. I appreciate his dilemma, and I appreciate the need for greater rural electrification, which was stressed by my hon. Friend the Member for Falmouth and Camborne (Mr. Hayman), but he singularly failed to pay regard to the cost to the ratepayers of Bristol, Exeter and Plymouth of the rural

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electrification scheme. I cannot talk about something which is not in the Bill, but there is nothing in it to lighten their burden. There are, however, certain other ways and means of dealing with that problem, and I suggest that if the hon. Gentleman reads the speeches made in Committee he will find some valuable suggestions for speeding rural electrification without being unfair to the citizens of large cities.
The Central Electricity Authority, as such, is no longer the boss, and as I said on the Second Reading, that is to be welcomed. There is a need, as there was in the original Act, for the separation of generation from distribution, but, at the same time, there should be some authority constituted to co-ordinate their activities.
In that regard, we have gone back to what was the practice before nationalisation, where there was the Central Electricity Board responsible for generation—the national link—and the Electricity Commissioners who exercised financial control over the distribution network. It was then left to the private companies and the municipal authorities to control their own areas. Now, instead of control by the companies and the municipalities of their own areas, we have within this Bill the Electricity Council which, of course, has complete overall control.
The Bill is considerably weakened by the fact that the Central Electricity Authority is now no longer in a position to manufacture plant. It is true that power was never used, but it was an important reserve power. What I think is still wrong with the Bill is that the plant required for maintenance has not been defined. I do not want to weary the House, as I did yesterday for twenty minutes on this theme, when I gave what I thought were practical examples of the difficulties into which we shall be led when the powers that be have to operate this Measure. Certainly there will have to be some definition later.
In having given way to the hon. Member for Kidderminster in this connection. the Minister has put himself into precisely the same difficulty as we were in during the Committee stage when we were discussing Clause 2 and trying to define what is a fitting and what is not a fitting. The door is open to someone
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to challenge what is plant for maintenanance in this Bill. That will be a weakness—
Mr. Maudling Mr. Maudling indicated dissent.
Mr. Hobson: The Paymaster-General shakes his head, but I assure him, as one who was fourteen years in a power station, that he will find this a problem. For instance, will it be said that the necessary gear for testing boilers—
Mr. Maudling: There is no reference to plant now. The Generating Board is allowed to manufacture anything—plant, fittings, anything they like, for the purpose of repair and maintenance.
Mr. Hobson: My concern is about the definition of what is repair and what is maintenance. I gave examples of the difficulties that would arise. I should be out of order if I referred to them now, but if the right hon. Gentleman will take the trouble to read the contribution I made yesterday, he will find that I gave specific examples of difficulties which I thought would arise. For instance, gear for the testing of boiler pressures, which have to be tested at 2½ times the working pressure. In most firms the maintenance departments make the pumps for the purpose of fitting and testing. It could be argued that the plant can be bought outside.
The other weakness in the Bill is with regard to railways. Here again, we have this stupid provision whereby there are to be bulk charges for the railways, which cannot use the energy purchased in bulk for the purposes of traction, for their own workshop practices. Indeed, the Paymaster-General said that the railways would have to buy their electricity for workshops from the area boards. That really does seem madness. It is thoroughly impracticable, and only results in two sets of profit, and I object to profit being given in that manner even to a nationalised concern. It is an ugly pattern. There should be certain benefits given to a large consumer, and one of them should be that when he purchases the energy in bulk, he should be allowed to use that bulk energy for the purposes which are necessary for his business or industry.
I think that the strengthening of the Consultative Councils is welcome, and I was particularly pleased to see that the

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hon. Member for Clitheroe (Mr. Fort) was successful in getting an Amendment through the Committee stage. I am not so sure whether he did it with our help or not, but we certainly did not oppose him. Indeed, I think there were three occasions on which we saved the Government from humiliating defeat, and it is largely as a result of our activities that the right hon. Gentleman is able to smile and be placid on Third Reading, because of the support which we gave him in defence of our principles of nationalisation.
There is one weakness still in the Bill. The bulk buyer now has a direct approach to the Consultative Council if he has a grievance, and it may be just as well if we gave consideration to the plight in which the private consumer sometimes finds himself, because in so many areas people do not know who is their representative on the Consultative Council.
I think my right hon. Friend the Member for Lewisham, South (Mr. H. Morrison) performed a service to the House in his intervention today, and I hope that his remarks have been noted by the Paymaster-General, because there is no one who has had greater experience in general administration and structure than my right hon. Friend. I thought he pointed out what could be a potential weakness, and certainly that will have to be watched. It is absolutely essential to recognise that the new Electricity Council has a real job to do, and it may be, of course, that in the light of experience a review may be made of its functions.
Tribute has been paid to the industry, and I do not propose to do so on Third Reading, because I paid my tribute to it on Second Reading. We shall watch the operation of this Act very closely indeed. It remains to be seen whether there is the extent of devolution that we have been told will now happen. We shall have to see how it works out in practice.
7.24 p.m.
Sir F. Soskice: We have now arrived at the concluding stage in our deliberations in this House on the Bill. I should like, at the outset of my concluding observations, to pay a tribute, which many of my hon. Friends and hon. Members opposite have paid before, to Lord Citrine and those who made this industry,
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both in the Central Electricity Authority and in the area boards, the acknowledged success which, on all sides of the House and on both sides of the Commitee, it was recognised to be—a success which was underlined in the Herbert Committee Report, in particular in the passage which I had occasion to read in our discussion earlier today.
While I am paying tributes, I would also assume the pleasurable task of paying tribute to others who have contributed to our debates. I should have thought that all hon. Members would be glad to join in the tribute paid to my hon. friend the Member for Cleveland (Mr. Palmer), and I join with his name that of my hon. Friend the Member for Keighley (Mr. C. R. Hobson), both of whom have brought to our debates the great advantage of practical experience over a very long time in the industry which is under discussion.
In that regard, they have the advantage over us who speak from study, from hearing the arguments and from a rather theoretical aspect of the industry. Their practical experience has supplemented the want which was apparent, certainly in my own contributions, and to a lesser extent probably in other hon. Members' contributions to the debate. I feel sure that we also enjoyed and felt great benefit from the intervention by my right hon. Friend the Member for Lewisham. South (Mr. H. Morrison), who brought to bear in this stage of our debate the great weight of his long experience and authority.
May I pass from one side of the Rouse to the other, and offer a word of tribute to the two much harassed Minister, who helped us very much in our consideration of this Bill? They have had to encounter the badinage which is the fate of all Ministers, and we have felt regretful when we have had some criticism to offer against them personally. They faced it throughout with that stolid imperturbability which all Ministers must display who know that they are 100 per cent. guilty, and we respect them for that.
We agreed to the Bill, in particular because we thought that, after nearly ten years of life, there was a case for considering a remodelling of the industry on the lines suggested in the Herbert Committee's Report. When the industry was first set up under public ownership, it

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seemed to us that there was a far greater need for a strong central cohesion than might be necessary at a later stage of the industry, when it was well under way and it had displayed that of which it was capable. It has taken its part in our national life, and it serves a most valuable and useful need in the forwarding of our economic life in general.
It was with that thought in mind that we felt that the Government were justified in saying that the time had arrived when some measure of decentralisation should be tried, and, as my hon. Friend the Member for Keighley has just said, we will watch most closely the operation in practice of the Bill and the further progress of this industry in its new and amended form.
My right hon. Friend the Member for Lewisham, South felt hesitation, which indeed, on our first consideration of the terms of the Bill when it was first published, many of my hon. Friends on this side of the House also felt. The question was posed and actively canvassed and discussed whether it was right to dismantle the Central Electricity Authority and substitute in its place the Generating Board and what we regard as perhaps a slightly too colourless Electricity Council invested with the somewhat amorphous functions which the Bill reposes in it.
The clash of view on the Bill developed early in our debates upon it—indeed at the Second Reading of our discussions, because it was at that stage that the then Minister of Fuel and Power indicated that it was the intention of the Government to depart from the recommendations of the Herbert Committee in relation to the Electricity Council itself.
The Herbert Committee recommended that the Council should have considerable supervisory powers, including a power to give directions to the boards, and if it had had those powers it would have been placed more in the position envisaged by my right hon. Friend the Member for Lewisham, South who voiced his criticisms as to the creation by the Government of the Electricity Council, floating in the air—as he described it—and not anchored down to any practical responsibilities.
That was an anxiety which we felt very greatly when we first saw the terms of the Bill, and that anxiety has not yet
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altogether been allayed. It was for that reason that, in the course of our discussions both in Committee and on Report, we made constant endeavours to strengthen the Council and give it more defined and specific functions to perform and more influence in the general governance and direction of the industry. We thought that it should be more in a position to bring the industry together, in order to make sure that it served an overall need, and to prevent it falling apart and becoming a series of twelve electricity boards meeting on occasions round a table to discuss common and uncommon problems under the guise of an Electricity Council.
The Government have met us to some extent in that regard. They have strengthened the personnel of the Council, although they have not felt able to accept the various proposals which we made which would have required the Council to discharge executive functions. Nevertheless, we feel that the Government have at any rate shown some disposition to recognise the validity of our views in the matter. When we considered whether we should divide upon the question, "That the Bill be read the Third time," we carefully weighed what the Government had done as a result of our representations, and I think it is the view of my right hon. and hon. Friends that, although we should have desired the Council to figure more in the capacity envisaged for it by the Herbert Committee, we nevertheless think that with its personnel strengthened, as the Government have strengthened it, it does not fall so far behind what we should desire it to be that we should feel compelled to review the attitude we took to the Bill during its Second Reading.
Two points very actively engaged our minds, as has been apparent in the course of our debate on Report. We felt profoundly that the Government were making a serious mistake in curtailing the powers of the Generating Board to manufacture electrical plant. We thought—and we still think—that that is a great mistake.
The second matter was that which was raised by Amendments moved by some hon. Members opposite, seeking to take away the power of the Board to guarantee electrical stock. The Government, as one knows, gave way upon the first point, but fortunately managed to hold out on the

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second. We attach importance to those two points because we think that it is wholly wrong to regard the industry as analogous to a purely private industrial concern. It never was, and it never will be, because the Statute and the public need require of the industry that it shall serve all and sundry. It cannot—as private industry and private commercial concerns can—choose its customers. It cannot cream off profits, and it cannot disregard that sphere of operations which will bring no profit and will probably bring a loss. It is under a duty to undertake, in its service to the nation, both the profitable and the unprofitable.
In those circumstances we feel that the industry has an extra special burden placed upon it—a burden which public interest must impose upon it. We therefore believe that it is essential that an industry struggling under that disadvantage should have public credit behind it. For that reason we think that it would have been a very serious error on the part of the Government if they had listened to the proposals of those who believe in the divine beneficence of the money market, and had robbed the industry of the Treasury guarantee which we believe must stand behind it.
It was for the same sort of reason that we felt very incensed with both Ministers when they capitulated upon the question of the right of the industry to manufacture its own plant. We think that it should have that right, whether or not it has been exercised hitherto. It has become almost a matter of principle. We cannot see—and in this context it is necessary only to quote the Minister's own argument—why the industry, burdened as it is, should not have the facilities available to it that any private concern has. We believe, as a matter of principle, that it is adopting a wholly wrong approach towards a nationalised industry—and here again I simply repeat the arguments used by the Minister himself when he was in a more courageous mood—to hamstring a nationalised industry in this way.
The Government's attitude upon that matter gave us serious doubts whether we should any longer give our consent to the Third Reading. Having weighed the whole question, however, and bearing in mind that after ten years of life and ex
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perience it is reasonable to see whether the industry should now be remodelled —not basically changed, but remodelled in some particulars—we have come to the conclusion that we shall not divide upon the proposal that the Bill should be given a Third Reading.
Everybody would wish this great industry well. We shall watch its progress and do all we can to assist it both to expand and to make itself sufficiently powerful to carry the great and increasing burdens which must ever be imposed upon it, not least that which will now rest upon it with the advent of nuclear power as a great source of energy in the development of our non-warlike industry. In those circumstances, and for the reasons that I have given, I hope that the House will agree that the Bill should now be given a Third Reading.
7.37 p.m.
Mr. Maudling: I feel that I should begin by thanking hon. Members. particularly those who were members of the Standing Committee, for creating the atmosphere in which the discussion on the Bill has proceeded. I was particularly grateful for their courtesy because, as the House will he aware, I came fresh to the Bill just before the commencement of the Committee stage, and had to pick up a good deal as I went along. I was helped a great deal by many of the reasonable suggestions put by hon. Members on both sides, a number of which—though, I admit, not all—have been incorporated in the Bill. I should like particularly to thank my hon. and learned Friend the Parliamentary Secretary for the assiduous assistance that he has given me throughout and for the tremendous help that he has been through all stages of the proceedings.
In the course of this discussion on the Third Reading, three main points have arisen. There is the question of the manufacture of plant; the question of rural electrification and the main question of the basic structure of the industry. Upon the question of the manufacture of plant, I would first refer to what was said by the hon. Member for Keighley (Mr. C. R. Hobson). I still do not think that he is quite clear as to the amount of latitude given in the matter of manufacture. The Bill now says that the Generating Board has power to manufacture anything—plant, fittings or anything else—

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which it requires for maintenance purposes, irrespective of its ability to buy the plant or fittings outside. The provision is as broad as that. I do not think that the difficulties to which the hon. Member referred need arise in practice.
I appreciate the point of view of the right hon. and learned Member for Newport (Sir F. Soskice) in the matter, but I think that he was slightly exaggerating when he used the word "hamstring" to refer to an Amendment introduced to take away a power which his hon. Friend the Member for Edmonton (Mr. Albu) and one or two others described as an essential one although it has never been used. I think it relevant to point out that the argument which has mainly been used in defence of the power to manufacture has been the argument of protection against exploitation by price rings. That is counterbalanced by the fact that we have the restriction on trade practices which should afford proper supervision and protection for the Electricity Authority in this regard.
The second point to which I wish to refer is that of rural electrification. The argument has been advanced that the provisions in the Bill will hold up the progress of rural electrification, I do not accept that at all. I have studied as closely as I can the economics of the various area boards and I think it right to say—as did the Herbert Committee—that the balance of load in all the respective areas is pretty even. They have been drawn geographically in such a way as to give a varied and evenly balanced load to each I have studied the forward estimates of the South Western Board, and I am satisfied that nothing which has been done in this Bill will in any way impede the planned progress of rural electrification.
I come finally to the third important point, the structure of the industry, on which we have had many discussions during the Committee stage and the Report stage; and we have also had the benefit of a most interesting intervention by the right hon. Member for Lewisham, South (Mr. H. Morrison), who has devoted so much thought to these matters. I think it is generally agreed that the Government were right to set up the Herbert Committee. I think it was useful at this stage in the advance of a nationalised industry to have an impartial study of the industry. What the Report
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said about the industry can be fairly summed up, I think, in this way. The Report said that the industry and the people running it have done a good job, and could do still better if certain changes were made to its structure. The Committee pointed out certain faults which it saw in the industry, certain personal frictions that arose, and a reluctance to devolve decisions as much as should be done.
The Committee pointed out that problems of devolution of responsibility had not yet been fully solved, and suggested that, as a result, the industry was not bringing in new young people as fast as it should do, and modern methods of management and economic study had not been as widespread and were not being pushed forward as fast as they should be. The general expression of the Report was that this industry could do even better, were there a separation between generation and distribution, and more devolution in management. Those are the two principal things that the Bill is bringing into effect.
With the first point, separation of generation and distribution, the right hon. Member for Lewisham, South does not agree. He feels that a case for it has not been made out. I think I am right in saying that the House and the Standing Committee felt in general that the Herbert Committee had made a strong case for this; that the function of generation, which is a wholesale business, and the function of distribution, which is, by and large, a retailing business, should be kept separate. The conclusion of the Herbert Committee was that the present set-up had led to difficulties and friction which should be avoided; and so we decided as one of the principles of the Bill to separate generation and distribution.
Mr. H. Morrison: But surely generation was under the control of the Central Electricity Authority and distribution under the area boards, so that they were effectively separated.
Mr. Maudling: Yes, but the area boards were under the Central Authority, so that there was not an effective separation.
Mr. Morrison: Surely it is an exaggeration to say that the boards have not a considerable autonomous life of their own. If they had not enough autonomy,

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then, by all means, provide for that autonomy. But generation was a separate function from distribution, which was under the area boards. Generation was under the Central Authority, so I do not think that that excuse will wash.
Mr. Maudling: I do not think it is a question of washing excuses. I have never encountered an excuse that washed anything. If the right hon. Gentleman will look at the Report of the Herbert Committee, he will see that it dealt with this matter in some detail and produced solid arguments for the complete separation of the two functions.
The second point is the matter which was discussed most, either directly, or by inference, throughout our proceedings. I refer Lo the degree to which responsibility should be devolved or left to the Central Authority. We have accepted the two principles which the Herbert Committee supported. We want maximum devolution, and I think everyone agrees that in a modern industry no single unit should be larger than is necessary to get the full benefit of the advantages of large-scale operation—to derive the full "economies of scale."
Proceeding on those two principles we came to the conclusion that the right thing to do was to treat the various boards, the Generating Board and the various area boards, as separate entities responsible in their own right as much as possible for providing a service on an economic basis and paying their own way. In our Bill we have followed more the logic of the Herbert Committee than its recommendations.
When the Herbert Committee suggested the respective functions of the Central Authority and the various boards, it put in the control of the Central Authority functions which should belong either to the Minister or to the area boards. In some ways the Herbert Committee wanted to take from the Minister powers which he has at the moment, for example, the power of approving the capital programme of the industry as a whole. for which he is responsible to this House. I feel that hon. Members would not like to see that taken from the Minister. On the other hand the Committee put into the hands of the Central Authority powers which—
Mr. Morrison: Hang on to the Ministerial power.
Mr. Maudling: —would take away from the responsibility and independence of the area boards. For example, the Herbert Committee suggested that the Central Authority should approve the capital and revenue budgets of the area boards. In a number of other recommendations it seemed to me that the Committee was taking responsibility from the Minister, and that on the other hand it was taking from the area boards their rights and duties to be independent. So we came to the conclusion that to interpose an executive council between the Minister and the area boards would not work.
We felt that the right structure was to have the industry based fundamentally on the area boards and the Generating Board, each with their respective functions and service, and paying their own way; with a central Council primarily of a consultative character, with certain executive functions designed to assist the Minister and advise him when he has to reach a decision on such fundamentally important matters as approving the capital programme of the whole industry.
I think that it is on this question of organisation that the main arguments have centred, and they have been arguments of degree rather than principle. As was said by the hon. Member for Cleveland (Mr. Palmer), time, if it shows anything, will show who is right. Now that this Bill is nearing its Third Reading, I think we all feel that we should wish it success and hope that through it we shall succeed in bringing to the industry the sort of benefits which we all hope will be provided, and which we on this side of the House claim will be provided, by the Bill.
May I conclude by paying my tribute to the work which has been done and is still being done by the Central Authority under the remarkable leadership of Lord Citrine, with the full support of this industry in its nationalised form? No one is proposing by this Bill that the industry should be denationalised. What we are seeking to do is to make the existing setup more efficient. I hope that we are doing so, and we all wish well to the industry in its future tasks.
Question put and agreed to.
Bill accordingly read the Third time and passed.

EDUCATION (SWIMMING INSTRUCTORS)
Motion made, and Question proposed,That this House do now adjourn.—[Colonel J. H. Harrison.]
7.49 p.m.
Mr. F. Blackburn: I ought to apologise to the Parliamentary Secretary to the Ministry of Education for the fact that he is unable to attend another function because he has to be here to answer this debate. Perhaps we shall not be here for very long and he will be able to grant me what I am going to ask for and then fulfil his engagement, although he may make a late arrival.
The question does not concern large numbers but involves an important point of principle. It is a question of justice, and in this House we should be very jealous about justice, seeing that justice is done to everyone. It does not depend upon the number of people involved.
On more than one occasion I discussed this problem with the Parliamentary Secretary's predecessor, and with him also the question of a national salary scale for youth officers. The hon. Gentleman has inherited that problem, and I understand that he is giving it his personal attention. I am glad to hear it. People who do the same sort of job with the same sort of qualification and experience should have some similarity in their remuneration. I hope that the Minister will extend the scope of his activity and include swimming instructors with youth officers. The problem does not involve large numbers; the number of swimming instructors is not large and is diminishing, but the smallness of the numbers does not justify inequalities of remuneration.
I understand that it is the policy of the Ministry that swimming instruction shall increasingly be given by school stall. It is not my purpose to discuss the merits of that policy. Where there is a qualified teacher who is also a qualified swimming instructor, it is probably better that he should undertake the swimming instruction. No one will underestimate the importance of swimming instruction. We ought to make certain that in our junior schools every child who is not prevented by ill health should be taught to swim,
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and so long as there are swimming instructors employed by a local education authority there ought to be a basic scale applying to all of them.
The Parliamentary Secretary will be aware that local education authorities have no common basis of remuneration. I will cite three cases of local education authorities in fairly close proximity to each other, each employing swimming instructors. Let us compare the rates which they pay. The first local education authority I will call "local authority A". The scale it pays its swimming instructors begins at £475 and rises by increments of £20 to a maximum of £675. The second authority, local authority B, employs instructors with the same qualifications as those of authority A. In this case the scale is £ 456 2s. 6d., rising by increments of £15 to £589 7s. 6d.
I believe this scale is in accordance with that for one of the miscellaneous grades of local government officers, to whom any revision of the scale automatically applies. That is not so in the case of swimming instructors, who have to make individual application to the local authority when any increase takes place. This application then goes to the Ministry for approval. I understand that this is a new scale which was introduced last year. It is worthy of note that the local education authority did not place the instructors on the appropriate place in the scale according to years of service.
The classes of local authority A are always accompanied by a teacher from the school, while the classes from local authority B frequently are not. Therefore, though the remuneration is less, the responsibility is greater.
Let us come to the third authority, which I will call "local authority C." The payment here is one guinea per session, with an increase of 2s. per session after five years' service. Since authority C is a county authority and does not possess its own swimming baths, it often uses the same baths as authorities A and B. The Parliamentary Secretary will notice the wide difference in remuneration, and will agree that there are serious anomalies for which there can be no justification.
I hope that the Minister will give as sympathetic consideration to this problem as I know he is giving to the problem of youth officers. If there are other

679
officers of the education authorities for whom no national scale exists, I hope that the same consideration will be extended to them.
I would put a suggestion to the Parliamentary Secretary. Would not the fairest solution in regard to swimming instructors be for the Ministry to negotiate with the local education authorities a salary scale, the maximum of which would represent a certain percentage of the qualified teachers' scale? I will not name any percentage. Whatever changes took place in the scale for the qualified teachers could then take place for the swimming instructors.
I shall listen with interest to what the Parliamentary Secretary has to say. I promised him that I would not speak for very long, and I have now said all I have to say. I hope that his answer will not be that as the swimming instructors are a diminishing number the Ministry intends to do nothing about them. As I said at the beginning, justice does not depend upon the number of people involved.
7.57 p.m.
The Parliamentary Secretary to the Ministry of Education (Sir Edward Boyle): I thank the hon. Member for Stalybridge and Hyde (Mr. Blackburn) for the kind words at the start of his speech. I am sure that anyone who has written a first-class biography of a former much beloved Minister of Education is fully entitled to keep the Parliamentary Secretary at 8 p.m.
In any case, it is always a great pleasure for personal reasons to reply to a debate on swimming instruction. I was no great athlete at school. I never scored a goal, and my life aggregate at cricket is somewhere between 40 and 50. Nevertheless, I passed my swimming test on the first Sunday afternoon.
I am grateful to the hon. Member for the moderate and careful way in which he has presented his case. I will bring all the points he has made to the attention of my noble Friend when he returns from America.
First of all, I should briefly explain to the House my noble Friend's position in this matter. Under Section 89 of the Education Act, 1944, the Minister has
680
to appoint a committee which recommends to him salary scales for teachers. He has no authority whatever to prescribe salary scales which are not contained in the Report of the Burnham Committee. The Reports of the Burnham Committee are, of course, limited to certain well-defined categories of teachers. The Committee is primarily concerned with qualified teachers, but it also prescribes scales for certain special types of teachers in service before 1945 or for teachers who are granted the special status of temporary teachers. The Reports do not prescribe scales for people who have no formal qualifications to teach.
In general, swimming instructors do dot have qualifications which would entitle them to be regarded as qualified teachers. This is the difficulty. The large majority of them have not taken a course of teacher training and do not hold qualifications which the Minister can accept for the status of qualified teacher. My noble Friend does not think he should accept for qualified-teacher status qualifications in swimming alone. In recent years there has been considerable thought about the sort of physical education we want to see in our schools. One conclusion which is generally accepted among physical education experts is that swimming should be regarded as part of the wider curriculum of physical education and that, if possible, it should be taught to those who are able to treat it as part of an integrated course. After all, it is not the job of schools to train future Olympic champions, but we want schoolchildren to receive a thoroughly balanced course of training in all aspects of physical education.
I say all this in order to make it quite clear that swimming instructors cannot be regarded as full members of the teaching profession. It follows from this that the Minister cannot regard them as qualified teachers in the technical sense—the sort of term of art sense in which we use that expression. But, having said that, I should not for a moment like to give the impression that my noble Friend does not appreciate the very valuable service which many swimming instructors are performing.
I know there is, as the hon. Member has pointed out, considerable variation in

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the various scales being paid by local education authorities. Some authorities pay instructors on local government scales, others have adopted ad hoc scales according to the qualifications and experience of the particular individual, and sometimes these scales are related to the Burnham scales. I can assure the hon. Member and the House that my noble Friend would raise no objection to proposals received from authorities to bring some of the lower scales up to the level of the highest ones, but this primarily is a matter to be decided between the individual local education authority and its instructors. I am, however, quite sure that local education authorities throughout the country will note the points that have been very properly made by the hon. Member tonight and that the specific cases to which he referred will be carefully considered by them.
I cannot go further than that this evening, except to say that I am very glad the hon. Member has raised this matter, and to repeat that my noble Friend, certainly for his part, would raise no objection at all to proposals received from local authorities to bring some of the lower scales up to a higher level.
Mr. Blackburn: I thank the Minister for that reply—
Mr. Deputy-Speaker (Sir Gordon Touche): The hon. Member can speak again only by leave of the House.
Mr. Blackburn: With the leave of the House, Mr. Deputy-Speaker, I want to
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make it quite clear that I was not asking for swimming instructors to be paid as qualified teachers. Obviously that would be quite wrong. I realised, of course, that the Minister had not power to prescribe scales of salaries, but what I am worried about is what the Parliamentary Secretary has just said, that the Minister will be prepared to receive suggestions from individual local authorities. Of course, that is what has been happening and why we have such wide variations in the scales which are being paid by different local authorities.
I was hoping that the Minister would be prepared to have discussions with local education authorities or to bring these matters to their attention to see if a unified scale for the country could be arrived at.
Sir E. Boyle: I speak again, by leave of the House, to answer the point raised. One of the difficulties one always has in all these matters is the relationship between the central government and local education authorities. As I have said, this is primarily a matter to be decided between the individual local education authority and its instructors, but I will certainly bring to the attention of my noble Friend the suggestion the hon. Member has made. I do not think I can go further than that this evening.
Question put and agreed to.
Adjourned accordingly at five minutes past Eight o'clock.

NATIONAL FINANCE
  Ministers and Public Servants (Expenses)
  Ministers and Public Servants (Expenses)
  Off-Course Bookmakers (Tax)
  Off-Course Bookmakers (Tax)
  U.S.S.R. Gold Bullion (Imports)
  U.S.S.R. Gold Bullion (Imports)
  Sterling Area (Gold and Dollar Reserves)
  Sterling Area (Gold and Dollar Reserves)
  Government Expenditure
  Government Expenditure
  £Sterling (Value)
  £Sterling (Value)
  Entertainments Duty (Cinemas)
  Entertainments Duty (Cinemas)
  Industrial Production
  Industrial Production
  Petrol Rationing
  Petrol Rationing
AGRICULTURE, FISHERIES AND FOOD
  Ploughing-up Grants
  Ploughing-up Grants
HOME DEPARTMENT
  Byelaws (Spitting)
  Byelaws (Spitting)
  Fingerprinting (Claim)
  Fingerprinting (Claim)
  Bookmakers
  Bookmakers
EDUCATION
  Teachers (Housecraft)
  Teachers (Housecraft)
  Block Grants (Representations)
  Block Grants (Representations)
  University and Technological Awards
  University and Technological Awards
  Primary Schools (Teachers)
  Primary Schools (Teachers)
  Local Authority Grants
  Local Authority Grants
TRADE AND COMMERCE
  Imperial Preference
  Imperial Preference
  Imports
  Imports
JAMAICA
  Clerks of Courts (Duties)
  Clerks of Courts (Duties)
  Magistrates
  Magistrates
LOCAL GOVERNMENT
  Derbyshire Development Plan
  Derbyshire Development Plan
EMPLOYMENT
  Index of Wage Rates
  Index of Wage Rates
PENSIONS AND NATIONAL INSURANCE
  Contributions
  Contributions
  COMPTROLLER AND AUDITOR GENERAL (REPORTS)
  COMPTROLLER AND AUDITOR GENERAL (REPORTS)

Preamble
The House met at three of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers
The Lord Erskine—Sat first in Parliament after the death of his father.

FINSBURY SQUARE BILL [H.L.]
Read 2a.

FARMERS' BANKRUPTCIES
3.5 p.m.
VISCOUNT ALEXANDER OF HILLSBOROUGH: 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 whether they will state the number of bankruptcies of farmers registered in Great Britain in each of the calendar years from 1946 to 1956 inclusive.]
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (EARL ST. ALDWYN): My Lords, I will, with permission, circulate in the OFFICIAL REPORT the figures for the last eleven years.
Following is the information referred to:
The figures for farmers, together with stock rearers, market gardeners, fruit, flower and seed growers are:—

England and Wales

Scotland

1946

19

2

1947

35

4

1948

43

3

1949

68

6

1950

105

10

1951

124

7

1952

148

9

1953

182

6

1954

151

7

1955

195

6

1956

173

7

The figures for England and Wales are those compiled by the Board of Trade.
The Scottish figures, which reflect a substantial difference in bankruptcy law and practice, are not comparable with those for England and Wales, and have been furnished by the Accountant of Court.

PUBLIC HEALTH OFFICERS (DEPUTIES) BILL
Read 3a (according to Order), and passed.

WHITE FISH AND HERRING INDUSTRIES (No. 2) BILL
Order of the Day for the House to be put into Committee read.
Moved, That the House do now resolve itself into Committee.—(Earl St. Aldwyn.)
On Question, Motion agreed to.
House in Committee accordingly.
[The EARL OF DROGHEDA in the Chair]
THE CHAIRMAN OF COMMITTEES: No Amendments have been set down to this Bill, and the Question is that I report it to the House without amendment. I beg to move.
Moved, That the Bill be reported without amendment.—(The Earl of Drogheda.)
VISCOUNT ALEXANDER OF HILLSBOROUGH: On the Question that this Bill be reported, may I say that I think it is an excellent Bill. I was not able to speak upon it at Second Reading. We are very anxious in the rural areas about the rapid increase over the past two years in the price of white fish meal, which is, of course, a very important agricultural foodstuff. If, at a later stage of the Bill, the Parliamentary Secretary could tell us something about this matter we should be grateful.
EARL ST. ALDWYN: I am not sure whether I followed the noble Viscount. I gather that he is worried about the price of white fish meal. Is that correct?
VISCOUNT ALEXANDER OF HILLSBOROUGH: Yes, the price has become almost prohibitive.
EARL ST. ALDWYN: I think the best course would be for the noble Viscount to put down a Question on the subject.
On Question, Motion agreed to.
House resumed: Bill reported without amendment.

DENTISTS BILL [H.L.]
House in Committee on re-commitment of the Bill, (according to Order): the Amendments made by the Joint Committee on Consolidation Bills agreed to.
HOUSE OF COMMONS DISQUALIFICATION BILL
Read 3a (according to Order), with the Amendments, and passed, and returned to the Commons.

ROYAL COMMISSION ON DOCTORS' AND DENTISTS' PAY
3.9 p.m.
LORD MORAN LORD MORAN rose to ask Her Majesty's Government whether they are satisfied that the terms of reference of the Royal Commission on the professional remuneration of doctors and dentists in the National Health Service will provide the necessary basis for a full examination of this problem; and to move for Papers. The noble Lord said: My Lords, in the early days of the National Health Service two Committees were appointed by the Government to deal with the remuneration of general practitioners and consultants respectively. Sir Will Spens was chairman of both Committees, and the recommendations of those Committees have come to be known as the "Spens Reports". I do not think that there is any doubt now that the recommendations of these Spens Reports were accepted by Mr. Attlee's Government; I believe that is generally admitted. But since, in this controversy, it seems rather easy to forget events of the past, I should like for a moment to remind your Lordships of the substance of ministerial statements on those recommendations.
In July, 1946, the Permanent Secretary to the Ministry of Health wrote to the British Medical Association stating:
" The Minister fully accepts the substance of the recommendations."
Three years later, in January, 1949, the Parliamentary Secretary to the Ministry of Health said in the House of Commons that the remuneration of general practitioners would be adjusted to give effect to the Spens recommendations. In May, 1950, Sir William Douglas, Permanent
1098
Secretary to the Ministry of Health wrote a letter in which the following passage occurred:
" The Minister agrees that the Spens Report remains the basis of the remuneration of general medical practitioners until such time as after the usual consultations some other basis is substituted."
Nor is there any doubt that the Government knew the precise meaning of those recommendations. They were interpreted then in the same way both by the Government and by the doctors. I can testify to this because I happened to be a member of the Spens Specialists Committee at that time, and I was in close contact with the Ministry of Health. I say this because the noble Marquess, Lord Salisbury, in announcing the Royal Commission, said that the interpretation put upon the Spens Reports by the profession could not be accepted by the Government. The Government appear to have first expressed doubts about the interpretation of Spens when a Judge of the High Court, Mr. Justice Danckwerts, awarded the general practitioners £40 million in 1952. From that day until now the Government have been anxious to get rid of Spens.
I do not want to bring forward these facts in any controversial spirit, but I do want your Lordships to understand how these recommendations appear to the doctors. Mr. Attlee's Government may have been ill-advised to accept these recommendations and to promise to implement them; but the fact remains that they did accept them, and that it was upon that acceptance that many doctors entered the Service. That being so, I think your Lordships may feel that in all the circumstances these recommendations cannot be thrown upon the dust-heap just because they have subsequently proved inconvenient.
If the Royal Commission interprets their terms of reference so that they are not required to pay regard to what has happened in the past, if they are going to make a fresh start dealing merely with future scales—if, in a word, they are going to ignore these obligations, then I say deliberately that they are wasting their time; they will not allay the discontent among the doctors, nor will they provide a lasting solution of this question of remuneration. I should like to ask the noble Earl, Lord Home, when he replies,

1099
if he will say whether the Royal Commission will or will not take into account the Spens Reports; and if the answer is in the negative, I trust that, even at this late hour, the terms of reference may be changed. There is, I understand, a recent precedent for this, because the terms of reference of the Royal Commission on Taxation were altered halfway through their proceedings. I press this matter because, with the present terms of reference, we shall get nowhere.
As I have said, when the doctors went into the National Health Service they understood quite clearly that the cost of living would be taken into account when their pay was reviewed from time to time. Nevertheless, I trust that the doctors will not try to bind the Government to a literal interpretation of Spens in perpetuity. I know that this will excite the wrath of a section of my profession, but if we are to get a settlement of this dispute that will be mutually satisfactory to the Government and to the doctors, there must be give and take on both sides. However, if the doctors are to give up Spens, or at any rate, the literal interpretation of Spens—namely, that every rise in the cost of living will be met by a rise in the salaries of doctors; if these pledges are to be thrown away, if the doctors are to go into the future with no yardstick with which to measure their remuneration, then I think that your Lordships may feel that they are entitled to some quid pro quo.
On this particular subject I do not feel that I am entitled to speak for the general practitioner and I ought to make it clear that even in the case of the specialist, there has been no vote on the subject. In the summer, however, I spent two or three months going round the country, speaking at meetings of consultants, raising these questions in debate; and I think I can assure your Lordships that the proposal I am about to make would receive very substantial support from the consultants. They feel that if they are to get a rise in remuneration, that, by itself, will not be a final solution. Presently the cost of living will go up and there will be another claim; and this will go on and on until the Government and the country become exasperated. The Government may even be led to set up a whole-time Service. What is needed even more than a rise in pay is some reformation of the arbitration
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machinery. At the present time, if there is a dispute between the consultants and the Government, it is referred to Whitley Council B. This consists of two halves, the doctors and the officials of the Ministry; and only if they agree, can a dispute go to arbitration. But in all matters of substance they never do agree. The Government see to that. They exercise their veto precisely as Russia exercises her veto in the Security Council. The result is that the consultants generally have lost confidence in this machinery.
What would they accept in its place? The pattern is clearly set forth in the Royal Commission's Report on the Civil Service. In November, 1955, the Royal Commission reporting on the Civil Service recommended that a special advisory committee should be appointed by the Prime Minister to supervise the pay of the higher ranks of the Civil Service. That Committee has since been appointed. It is precisely what the specialists need.
If such a Committee were set up, I should probably be asked at once "Will the consultants be content with the reformation of the machinery of arbitration, or will they ask also for a rise in the remuneration?" That is a fair question, but it does not perhaps display a very intimate knowledge of the architecture of my profession. It is essential that there should be a balance of proportion between the pay of general practitioners and the pay of consultants, or recruiting to the ranks of specialists will suffer. There comes a time in the would-be consultant's life when he has to choose between two alternatives: between going out into general practice, with the rest of his contemporaries, or staying on at his hospital for four, five or more years in order to obtain the higher degrees and also in order to fill the posts of junior and senior registrar. Those years are years of penury. The salaries are small and it is a period of anxiety, because the would-be consultant does not know whether, in fact, he will ever become a consultant.
In these days, when most men marry young, no man is going to ask his family to go through these years of anxiety and penury unless he has some assurance that at the end of it all he will receive some material reward when he becomes a consultant. In 1954 this fact was clearly recognised. It was seen by the Government that when £40 million had been given to the general practitioners and

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nothing to the consultants, the whole balance between the two branches of the profession had been upset. The deans of the medical schools were in no doubt that, unless this was set right, the recruiting to the ranks of the specialists would suffer. The Government therefore in that year made a grant to the consultants which I call the Danckwerts equivalent. I think we consultants owe the Danckwerts equivalent largely to the noble Marquess, Lord Salisbury, and that his resignation at this juncture is a mishap to the doctors, because it removes one of whom we came to believe that the merits of the case far outweighed political expediency.
Now let me come to the crux of what I have to say—that is, the terms of reference of the Royal Commission. Before doing so, perhaps I may for a moment dwell on the inconsistency of the Government in pressing every section of the community to go to arbitration except the doctors. But let that pass. What is provided in its place? A Royal Commission. Can your Lordships imagine the Minister of Labour facing the shipping and engineering industries, when they are asking for a rise in wages, and fobbing them off with a Royal Commission? The doctors feel that they are being treated differently because they have no political power; and that, of course, produces bitterness. Nor were the doctors better disposed to the idea of a Royal Commission when, on February 20 this year, the Minister said to the representatives of the negotiating committee that if the Royal Commission found in the profession's favour, and if the economic situation of the country remained the same, it by no means followed that anything would happen. Apparently, the findings of this Royal Commission are to be taken seriously only if they are in the Government's favour.
But what really aggrieves the doctors is the actual terms of reference. Royal Commissions are generally free to gather in information wherever they can find it; in fact, "all relevant factors" is almost a cliché in the circles that deal with Royal Commissions. But what has happened to this Royal Commission? It is the Government who direct the Commission what they may and may not consider. It is the Government, not the Royal Commission, who decide the considerations that bear on the remuneration
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of doctors. And these considerations boil down to a specific comparison with other professions.
I have no doubt that if the Royal Commission have access to the Inland Revenue files, as I presume they will have, it will be possible for them to compare the incomes of members of various professions. But the hours of work differ completely: the doctor is at the beck and call of the public at any minute in the twenty-four hours. Moreover the length of the training varies enormously as between one profession and another. Then—and this is the crux—the responsibilities are not comparable. We all make mistakes; but if doctors make mistakes their patients may pay for them with their lives. There is nothing like that in any other profession. A leading architect, who agreed with me on this point said: "At least we cannot kill people." But what really aggrieves the doctors is that these terms of reference have been so drawn up that they limit discussion; they exclude points which are greatly in the doctors' favour, and prevent them from bringing forward their case properly. I am sure that that was not the intention of the Government, but that is how it is going to work. It is surely quite wrong.
For a moment I must digress to a detail. Your Lordships may already have surmised that the doctors do not expect very much good to come out of this Royal Commission. But I am concerned that harm does not come from it. I am thinking, in particular, of what are called "merit awards". These awards were brought in, at the beginning of the Service, by Sir Will Spens, a layman, and were approved by a Committee comprising a majority of laymen. They were introduced as an incentive. It was seen that by going into a Service the doctors would lose the competitive stimulus. These merit awards, were given to a third of all consultants and made a substantial addition to their income.
At first, the idea of these merit awards met with some suspicion in the profession. It was felt that the London medical schools might swallow them all up, and that the consultants in remote parts might be forgotten. For the last seven years, for two months every year, I have been holding meetings of consultants to show them precisely how this

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system is worked, to let them ask questions and to gain their confidence in its working. There can be no doubt that at the moment the system enjoys the confidence of the great majority of the consultants, and they would be most aggrieved if anything happened to these merit awards. Is this delicate plant now to be taken up by the roots to see whether it is growing well? I would ask the noble Earl who is to reply whether the Royal Commission will go into details of this kind; whether, in fact, they will consider these awards.
Before I end, I should like to give your Lordships some of the background to this dispute, because it is a symptom of a good deal of unrest in this Service; and if your Lordships are to understand that unrest you must for a moment get into the minds of the doctors. When certain industries were nationalised, the workers welcomed it. But when medicine was nationalised, it was carried over the heads of the doctors by the politicians; the great majority of consultants were aghast that their whole way of life was being altered and that they were being put into a Service. I was one of a minority—I think a small minority—which supported the National Health Service Act and tried to work for its good. I did that, not because I believe that doctors necessarily work better in a Service than as individuals, but because I felt that it was politically inevitable; that all three Parties were committed to a comprehensive Service for the whole country, and that if such a service were to come into being the doctors must help to shape it. This attitude of a minority created great bitterness. A doctor in the North of England, whom I did not know, wrote to me to say:
" I am glad you will not live to see the result of your sins."
I mention that to your Lordships because I want you to grasp that the situation we are discussing this afternoon goes far deeper and is far more fundamental than any question of finance.
We hoped that the doctors would be won over by an enlightened policy. I think we dreamt of another Morant whose imagination would enable him to put himself in the shoes of these disgruntled doctors. We had in mind the kind of man who is still upset when he reads Defoe's story of a child of four in full
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employment—though he has long ago forgotten the details of the Battle of Blenheim. It worked out otherwise. It has been heartbreaking to see all this bungling and mishandling of the human element. I do not think Her Majesty's Government can be acquitted of blame. Successive Administrations have been more concerned with the cost of the Service than with putting their minds to making it work.
Forty years on, the Trevelyan of that time, when he is writing the social history of our day, will be puzzled by the levity of our behaviour. While we boasted of our Welfare State, we banished the Ministry of Health from Whitehall and dropped the Minister of Health from the Cabinet. The historian, with his eye for significant detail, will probably unearth the fact that while Sir Russell Brain was President of the Royal College of Physicians for seven years, he had to deal with six different Ministers. He may even go on to unearth another fact: that another President worked with sixteen Ministers since Mr. Neville Chamberlain's time. I recall two of these with gratitude and admiration. For the rest—well, all I can say is that their average life as a Minister of Health was twenty months; nine of them served for less than a year. I have the impression that if they had stayed a little longer they might have caught a glimmering of what it was all about.
The faults, of course, were not all on one side. Some of the doctors were un-co-operative. Many had spent half a lifetime under other conditions working as their own masters, and they were not likely to be reconciled in their lifetime completely and fully to the very different conditions that obtain in a Service. Nor did it help that in some regions they were treated as employees, instead of being called in as partners in a great enterprise. It is from the fringe of this section of disgruntled doctors that we get appeals from time to time for a rise in remuneration—appeals which are in themselves just, but which are not always made at the most expedient time. I myself regret that this question was brought up at this time.
From the same section come threats of violent action. I think that somebody in my calling should get up and say, as I say now, that many doctors are completely out of sympathy with any violent measures of that kind. We must look

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to public opinion for justice. As doctors, we can do no other. During the war, General Eisenhower found that unless British and American officers were friends, and worked together without criticising each other, he could get nowhere; and anyone who transgressed this unwritten law just disappeared. We desperately need a General Eisenhower in the National Health Service. We need a different spirit, we need to make a fresh start. Let the new Minister, who has an immense opportunity, leave his desk; let him take wings and go out into every part of the land, making friends everywhere with the doctors. I think he will be surprised at the response. Then, and only then, will the country get some value for the immense sums it is spending on this Service. At the end of my life, with some experience of doctors, I beg the Government to think again. My Lords, I beg to move for Papers.
3.34 p.m.
VISCOUNT ALEXANDER OF HILLSBOROUGH: My Lords, I am sure that noble Lords in all parts of the House will feel that they have listened to a very remarkable speech. It was a speech delivered by one who reached the highest peak that could be reached in his profession, especially on the physician side, and who has given unstintingly from his life, not only to the service of his profession but to the service of the nation, as was evinced by his own personal self-sacrifices from his other duties in the course of the war. One cannot but have been struck as we listened to the power of the speech. It seemed to me all the time that the noble Lord would have been equally successful as a great counsel at the Bar, as he mastered his subject and presented it in such complete sequence and in so convincing a manner. I felt that all the time that he was speaking. Moreover, it seemed quite clear that the noble Lord, as was evinced in the latter part of his speech, was not speaking with any kind of bias. His quite free remarks about certain aspects of the views taken by members of his profession made it clear that he seeks no more than, first, the good of the health of the nation, and, secondly, that justice may be done in the matter which has now been put under the review of a Royal Commission.
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I have taken little part in the Ministry of Health and its various operations in the course of my own ministerial life, but I have watched with considerable concern the development in the medical profession, in the last two years especially, of the feeling that they were not being, or were not likely to be, treated properly. I have a great many friends among doctors. I have been the President for thirty years of a hospital which is still outside the National Medical Service and which is entirely self-suporting, and needs to choose its doctors, consultants and various representatives of the profession with great care and to watch closely the effect of the treatment and the way in which the treatment is carried through.
I would say that the background to which the noble Lord, Lord Moran, drew attention towards the end of his speech was properly and, I think, accurately presented by him. I have watched the medical service grow since it was first as a whole placed under State control. There were serious objections to the scheme at the time in the profession. But I am bound to say that, looking at it largely as one who was at the head of a great voluntary hospital, I believe that in every respect the service in the medical profession within the National Health Scheme has steadily expanded and improved at every point, and that the effect upon the health of the nation has been magnificent. In these circumstances, what have we to do about the request which is being made by the noble Lord, Lord Moran, to-day? It seems to me that it is incumbent upon us to urge upon the Government that the terms of reference of the Royal Commission should be so amended as to bring each one of the cases cited by the noble Lord within the consideration of the Royal Commission, and that they should not, as a Commission, be in any way hamstrung by the special tags in the terms of reference which prevent them from looking at the matter with the wide, broad outlook that surely ought to be adopted if we are to deal with the grievance of the profession as it exists to-day.
Now what is the grievance? I think the grievance is largely in the same kind of spirit, but not engendered from exactly the same causes, as one sees in the major disputes that have occurred in our country. It seems to me fairly clear that,

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from the time of the Danckwerts judgment in 1952, the medical profession as a whole, in spite of the constant rise of the inevitable costs in their profession, took no real steps to ask for a steady annual review of their remuneration in relation to costs. It is only within the last eighteen months to two years that they have drawn attention to these serious rising costs, and they have had little sympathetic consideration of those claims. If my recollection is right, as I think it is, at the end of 1956 the doctors were quite coldly and coolly told that nothing was to be done for them in spite of the rising costs. As I meet a good many of the doctors both in London and in different areas, I can see that that gave rise to a very serious grievance.
On the other hand, I entirely agree with the noble Lord, Lord Moran, that, so far as my own soundings go, there are a good many doctors who do not wish a special organisation to be made in order to try to bring extra special pressure at the moment. At the same time, however, they ask that justice shall be done in the inquiry which the Government have now decided should be set up. I feel that the Government—I can say from this side of the House what the noble Lord would not wish to say from the Cross Benches—in this as in some other matters have been a little ham-fisted. Not the present occupant but the prior occupant of the office of Minister of Health made that non possumus statement to the medical profession that nothing could be done except to set up a Royal Commission on the matter. He did not show the kind of sympathy and judgment to be expected in a Minister or in a Government which had in their hands two such grave questions—the future of a great profession and the health of a great community.
3.42 p.m.
LORD AMULREE: My Lords, before I begin the few remarks I wish to address to the House, I should like to thank the noble Viscount who has just sat down for the staunch support he has given us. He has spoken for my profession in a way in which we ourselves would feel debarred from speaking because we are members of that profession. It gives us encouragement to know that the Leader in this House of one of the great Parties feels so strongly about what the medical
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profession has done and deserves. One of the things which I think should come along fairly soon, now that the National Health Service has been running for about nine or ten years—I think it came into being about ten years ago next year—is some kind of Commission or Committee of Inquiry. This should be set up to go into the various aspects of the Service, not because I think it is fundamentally unsound or wrong but because, when a great experiment has been running for ten years, it is due to those engaged in it that some stock should be taken as things go along. Therefore, I should like to see some sort of inquiry taking place in the fairly near future.
But what the Government have done is to set up a Royal Commission only upon the payment of the doctors. That, I feel, will not get very far. It will leave a great deal undone. I do not think it is going to be very easy to compare the wages or salaries paid to the medical profession with the wages or salaries earned by other people, because, as one of the two noble Lords who has just spoken pointed out, the work of the medical profession is so different from that of the other professions. If you are going to try to correlate, from an official point of view, salaries and work, it will be difficult.
I should like to call your Lordships' attention to two facts which I hope the Commission will take care of, one of which may come into the terms of reference for the Commission. The first point is very important: that is, to go into the question not only of remuneration but also of the method of remuneration. That may not sound very clear, and I will explain it. In the times before the Act came into force, it was possible for a general practitioner who was a good and popular doctor to move up in the quality of his practice. Although possibly he did not have to see a great many more patients, he did contrive to make more money, because the patients he saw were prepared to pay him more as he was a good doctor. That went on for a long time, but there were certain drawbacks to it. It may be said that a person could get a better type of medicine if he could pay than if he could not pay. I do not think it worked out like that, because a large number of doctors in the poorer

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practices gave better service. There was a possibility that a good general practitioner would make a substantial amount of money, possibly more than his colleagues. He could do that without being forced to take on more patients than he could possibly treat carefully.
That is one of the difficulties here. If a doctor wishes to increase the amount of money he gets from his practice, he has to take more people on to his list. With these large lists of 4,000 or so people, it is difficult for many doctors to give proper service. That is what I meant when I said that I should like the possibility of making some change in the method of payment of the general practitioner to be considered. I do not want to suggest what that should be—that is the point for the Royal Commission to consider.
With due deference to the noble Lord, Lord Moran, I would point out that a system was worked out whereby consultants had more money given to them. That was an incentive to them to do more work. At the present time, the practitioner has no such incentive, because the only way for him to make more money is to take on more patients than he can properly cope with. One of the difficulties is that when people are paid from public funds it is important to come to some satisfactory arrangement whereby their money can be increased. If they do not get paid extra salaries, they in a way pay a higher standard of taxation to the Government than other people do. They pay less of the ordinary standard tax, but they pay a concealed tax because they do not get enough money to enable them to cope with the increasing cost of living.
One has to be careful not to insist that one profession alone should be tied to a regular increase when the cost of living goes up. That would not be fair. Speaking as a member of the medical profession, I would not suggest that. I cannot talk either for the consultants or for the practitioners, but I am sure that none of us would wish to be put in a special privileged position as opposed to that of other people. We are in our present: frame of mind because we feel we have not been given what we were promised.
I have one more point which is a minor one but which is causing a certain amount of disquiet amongst practitioners. It is the question of holidays. It is fairly
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simple if a person has a partner or if he is a member of a group practice; he can take a holiday, because it is possible for the other partner to carry on without his having a locum tenens to assist him in his work. I was talking the other day to a doctor who is a youngish doctor in London and who is doing quite well. He has no partner. When he wants to take a holiday he has to pay a locum tenens for the time he is away. If he wants to get a good locum tenens, he has to pay him the sum of £25 or 25 guineas a week, which adds considerably to the cost of the holiday. Most people now get holidays with pay. This is a minor point, I agree, but it is one which is of some importance to the medical profession. There are many more points that I could bring forward, but I do not wish to take up your Lordships' time. It is because of the two facts that I have mentioned that I feel that something should be put into the terms of reference of the Royal Commission, to enable them to deal not only with remuneration but also with the method of remuneration.
3.50 p.m.
LORD HADEN-GUEST: My Lords, I am glad to have an opportunity of taking part in this debate because I was once a doctor (and medically speaking, I still am, although I have not practised for many years), my father was a doctor, and I was brought up in a doctor's house. I lived in, Manchester in the days before panels and that kind of thing were in existence, and my father had a large practice. Frequently I have assisted a dispenser on my father's premises at half-past ten in the evening—my father did all his dispensing at the surgery. I suppose that he had the largest practice in Manchester, so that I may claim to have been brought up surrounded by the influences of the medical profession.
But I never thought, and I know that my father never thought, primarily of the income that he was going to get. He did get a substantial income. If he had been present at this debate he would have found himself in a strange atmosphere, because I am quite sure—and I believe Lord Moran would agree with me—that normally a doctor is not a person who thinks primarily of the amount of money he is going to get. Of course he wants an adequate income, but he is not primarily concerned with making money.

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And, as I say, I know that my father was not primarily concerned with making money. The professional doctor is a quite different person from somebody who is in big business and who is making a lot of money. He is in a quite different position from that of the purely business man. Even at present, when many complaints are being made, I feel that the doctor is in a better position than many people who are in other professions.
I feel that we ought not to exaggerate in this matter. A person who is really a doctor loves his profession. He does an immense amount of work, a great deal of it as a volunteer, and frequently without being paid for it. That, I believe, is the attitude of a large proportion of people who go in for medicine as a profession. They want to do this work; they are interested in it, especially from the scientific point of view; and they find in it a satisfaction of their desire to be doing something useful, something interesting and, if they go into various sidelines of the profession, something which may take them a long way. For instance, I spent a large part of my time as a doctor in military service. I spent a great deal of my time in South Africa, and for a long time I was chairman of the medical committee which looks after the provision of doctors for the Services, in the course of which occupation I visited all the places in the world where British troops are employed, and reported on what they were doing. That is a career which is open to a doctor. There are doctors in the Services. They have not been mentioned so far but they do extremely good work, and the level and value of their work is certainly increasing.
It is also true, I think, that in the public health service, as medical officers of health and so forth, there is opened another line of work upon which doctors can be employed and can do the most valuable work. There is the work of the school doctor, which is now one of the most important features of doctoring carried on in this country. A good many years ago now the London County Council asked two other doctors and myself to visit the schools in London and to report on whether it was desirable to have a school medical service. At that time there was no school medical service
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and no school treatment service. As a result of the report which we made to the London County Council, these two services were set up. I instance that only as one of the numerous types of work which can be done. There are not only medical practices of the ordinary sort—specialists sitting in consulting rooms in Harley Street, and in other parts of the country, such as Edinburgh. We have in the medical profession a wealth of work connected with the health of human beings which is of the greatest possible value and, moreover, to anyone who takes an interest in his fellow citizens, of immense interest.
Primarily speaking, as I have said, a doctor is not a man who is thinking about money. Quite often, a doctor makes a lot of money; but he is not like the man in big business, sitting in his office intent on the amount of money which he can earn. He has no particular desire to make a lot of money. Of course, a doctor wants an adequate income, but I am convinced that he is a man who, to a large extent, has to live, whether or not he wants to originally when he starts on the work, a life dedicated to his profession. That is not so with somebody in the big office in the City carrying on large financial transactions. It is a different kind of life—the money is earned in a different way. The amount of money which can be earned by a doctor in any kind of practice or in any kind of appointment, whether it be a colonial appointment or some other sort, may be much less than would be earned in any ordinary business. The life of the doctor is something to which he dedicates himself.
I came into politics because I did a large part of my work as a school doctor—in fact, as one of the three school doctors who laid the foundations of the London County Council school medical service as it is at present. Our report was accepted and the Service came into existence. I believe that the doctor has to live a professional life and to consider only secondarily the amount of money he earns from it. Of course, he must get enough to live on. He must get enough to bring up his family in a proper way, and of course he must do work which is valuable to the community, There are many ways of doing that—ordinary medical practice is only one. There is the practice of a specialist, as well as that of the general practitioner.

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I will not emphasise further my particular point of view, but I say that a doctor must be a dedicated person. He must be someone who works very hard indeed—in fact, my father killed himself; he died at the age of fifty from overwork and other illnesses. I think that this profession will need to be treated differently from that of, let us say, stockbroking or other work of that kind—not that I have any objection to stockbroking in its proper place. I only emphasise that the medical profession is a different thing altogether and should, I believe, be treated in a different way altogether.
3.59 p.m.
EARL JOWITT: My Lords, may I add a word? I do so, first, because, I am sorry to say, my noble friend Lord Silkin, who was to have taken part in this debate, has been called away for other important public business and is not able to be here. The second reason why I wish to say a word is because ten or eleven years ago I was the Minister responsible for piloting the National Health Service Act through your Lordships' House. Believe me, it was not an easy task at that time. At the request of the Minister of Health I went to see and to address meetings of doctors in various parts of the country, so that I feel some little responsibility at the present time to see how this service is working.
May I expressing a purely personal point of view, just say this: whatever happens, I very much hope that the doctors will abandon any idea of what is called a "strike". For my part I believe that these strikes are getting far too common in this country. They are really an effort of pressure to advance private interests without due regard to the public interest concerned. Though it may be an unpopular thing to say, and especially unpopular on this side of the House, I feel that everybody must consider his own claim in the light of its impact on the general well-being. Therefore I would pray that we may accept far more generally the principle of arbitration, rather than resort to force, pressure and the like to win the desired ends. I say that whatever may be the answer to the rest of this matter, for that is my sincere personal hope.
I have tried in the past to show myself a friend of the medical profession. I am certainly a profound admirer of what that
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profession has done, and of the ethics of that profession. So let us try in this connection not to talk of strikes, for I believe that is beneath the dignity of the doctors. On the other hand, I think it follows from that—as I believe the noble Earl the Leader of the House will agree, for he is always fair-minded—that if there is to be arbitration, or its equivalent, each side has a right to make its claim and put forward its case. Then the tribunal adjudicates on the two cases put forward.
I have no word of complaint against the tribunal selected in this case, but our trouble at present is that the doctors are dissatisfied with the tribunal's terms of reference. They think that the terms of reference do not give the arbitrators that freedom of opportunity to decide which the doctors desire them to have. They may be right or wrong, but I feel that they have some reason for thinking that. If one compares these terms of reference with the terms of reference of the Spens Committee, one cannot but be impressed at once with the difference between the two. If there is to be arbitration, as I devoutly hope, my only plea would be that we should start by having the doctors reasonably satisfied with the terms of reference under which the arbitrators are going to sit. If they are not, then they are not really being given the benefit of arbitration.
Speaking for myself, I am by no means in favour of a sliding scale whereby the remuneration of doctors automatically varies with the cost of living. I do not think that that is practical, but I would not limit the arbitrators in any way. I would let the doctors put forward their case as they want it put forward, and let Her Majesty's Government put forward their case without any strings at all. Let those cases go before the arbitrators (I believe that we have very good arbitrators here) and let them strike a happy balance between the two and find out just what is right. It seems to me that the whole benefit of arbitration is destroyed if you put before the arbitrators a remit which one side, not unreasonably, considers an unfair remit. That is not arbitration of any value at all. I beg the noble Earl, in the difficulty in which we are in—for this concerns all of us—to accept that principle, to grasp the principle of arbitration; and I beg the doctors to do

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the same, to stop all this talk of a strike and to accept the principle of arbitration, letting it be seen that that arbitration is manifestly fair to all interests concerned.
I would beg the noble Earl the Leader of the House to use his influence, as has been done several times, in my knowledge, so that where the terms of the remit are found inadequate to embrace the whole dispute they may be enlarged. That should not be done by letters but regularly, enlarging the terms of the remit and putting the whole matter before the arbitration tribunal. Her Majesty's Government are not bound to accept what the tribunal decide, any more than the doctors are bound to do so, though I sincerely hope they will. At any rate, we shall in that way get an impartial, quasi-judicial hearing of the whole matter, and there is every reason to hope that the two sides will then be bound by it. That would be setting an example on the part of both the doctors and Her Majesty's Government. If it is not too late, I beg the noble Earl the Leader of the House to use his influence to bring about that end.
4.7 p.m.
LORD CONESFORD: My Lords, I had not intended to speak at all, and nearly everything I might have said has been said very much better by the noble Lord, Lord Moran, whose remarkable speech delighted the whole House. My excuse for speaking is similar to, though different from, that of the noble and learned Earl who has just addressed the House. At the time when the Statute was being carried through Parliament I was a member of the Opposition in another place, but I numbered among my constituents very many doctors because the great universities which I represented had great medical schools. In fact, only one Member had more members of the medical profession among his constituents than I had.
I know something about what doctors thought then and think now, and I very strongly support, in essence, the plea just made by the noble and learned Earl who spoke from the Opposition Benches. It seemed to me that he made one mistake in phraseology which in no way affected his argument. He talked about this Royal Commission as an arbitration tribunal,
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but of course it is nothing of the kind. Again and again the doctors have expressed their willingness that the matter of their claim should go to arbitration, but that request has been refused. I am not going to argue now whether or not it should have been refused, but I strongly agree with the view of the noble Lord, Lord Moran, that, if this Royal Commission is to serve any useful purpose, even from the point of view of Her Majesty's Government, it must not exclude from consideration the very question that the doctors are most anxious should be considered.
I know that the profession has taken a legal opinion on what their attitude to the Royal Commision should be—so I gather, from the representations that they have made to every Member of this House—but I cannot conceive of any lawyer advising the doctors that the terms of reference of this Royal Commission are satisfactory. How can they be satisfactory to the doctors, if the terms on which doctors entered the National Health Service are to be completely excluded from the consideration of the Royal Commission?
Before the terms of the Royal Commission had been settled I ventured to suggest to the House, by a question to my noble friend who then led the House, that there should be most careful consideration of what those terms should be. I regret that the medical profession was not consulted in any way, as I gather, about the terms. I cannot believe that this Royal Commission will serve any such useful purpose as I am sure that my noble friends in the Government desire, unless the terms of reference are amended. The noble and learned Earl, Lord Jowitt, who speaks with so much greater authority than I on these matters, has just said that, of course, you cannot satisfactorily alter, or indeed effectively alter, the terms of reference of a Royal Commission by an exchange of letters or anything of that kind. But, as Lord Moran has pointed out, there are precedents for varying the terms of reference of a Royal Commission, and I beg my noble friend who is about to reply not to close his mind against such amendment of the terms of reference of this Royal Commission as would enable it to conduct a much more useful inquiry than will be possible under the terms as they stand.
4.12 p.m.
THE EARL OF MORLEY: My Lords, may I intervene for just a few seconds in this discussion? I speak as one who has twice owed his life to the medical profession. I feel certain that the present position arises from the lack of faith which members of that profession have had in various Governments. As Lord Moran has said, it is not so much a question of remuneration as of lack of faith and confidence, which has developed since the National Health Service was established. I am sure that the members of this profession are the most loyal people in the wide world. As the noble and learned Earl, Lord Jowitt, has said, they do not want any strikes. I am sure they do not want anything of that sort at all, for, as I have said, they are the most loyal people in the wide world. They want merely proper treatment by the Government. Satisfactory conditions have been promised to them not only by this Government but by preceding Governments. On the question of remuneration, it must be borne in mind that their costs are much heavier now than they were formerly. They want that matter reviewed. But there must be a proper arbitration. A Royal Commission does not provide a proper means of arbitration. It merely makes recommendations, and the Government are not bound to say whether they will accept them or not.
4.14 p.m.
THE SECRETARY OF STATE FOR COMMONWEALTH RELATIONS AND LORD PRESIDENT OF THE COUNCIL (THE EARL OF HOME): My Lords, may I, in the beginning, explain to my noble friend Lord Moran that if my arguments this afternoon may seem blurred or indistinct it is not because I am doubtful of the Government's case but because the whole medical profession has not yet found a remedy for the common cold.
If any section of the community or any profession has a claim on the attention and sympathy of the nation it is the doctors, and Lord Moran need make no apology to the House for raising these questions of their remuneration and their status to-day. I should like to join with others who have paid their tribute to the power and sincerity with which Lord Moran put the doctors' case. Your Lordships will wish that, within the limits of
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reason and possibility, justice should be done to the profession, and that justice should be seen to be done, because no body of men gives more indispensable service to the people, and none has a greater sense of responsibility. I know it is the wish of my right honourable friend who has lately become Minister of Health that justice should be done. I say "within the limits of reason and possibility" because there is a background to this case for the increased remuneration of doctors from which none of us can escape. The National Health Service is a comparatively novel experiment. The State has no inherent virtues as an employer; none of us on this side of the House have ever deceived ourselves on that score. It is the first time it has had to work out a relationship with one of the great skilled professions, and inevitably, I suggest, it must take time—and it would be reasonable to expect it to take time—before a satisfactory code of relationship and conditions of service can be finally established.
Again, these eight years of the National Health Service have run concurrently with a time of intensifying inflation, when the purchasing power of money has consistently declined and therefore the costs of all the professions have been raised. I might, in passing, just remind the noble Viscount, Lord Alexander of Hillsborough, that the professional costs of the general practitioner are met year by year out of the central pool as the costs rise. In such circumstances—that is, against a background of inflation—the doctors no doubt feel convinced that they have a case for increased remuneration, both actual and in relation to others. But the taxpayers also are bearing record levels of taxation, and they have an unanswerable case for relief. The Government are responsible not only to the doctors but to the taxpayers—a most unenviable position. And they have to be responsible to all and try to be fair to all.
I emphasise the complex inter-relation of these factors, because there is one proposition which runs through this dispute which seems to me to be false. Your Lordships will recall that the Spens Committees were set up to investigate the proper remuneration for doctors entering the National Health Service in 1948. But it has seemed to be argued since then that, because the Spens Committees based their

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recommendation for remuneration on 1939 prices, therefore subsequent settlements must always guarantee the doctors against the extra costs brought about by inflation. Like Lord Amulree and, I think, like Lord Moran, I do not believe that that is really a tenable proposition. So long as inflation persists, it is impossible to insulate one profession against the effects of it or to guarantee that all professions shall advance in their remuneration with proportional precision.
The remedy, clearly, if we can achieve it—and this is, of course, the Government's policy—is to stop inflation, and that itself requires the restraint of wage earners and salary earners. But, short of the happy day when we achieve a halt to inflation, the best we can do is to try to make as sure as we can that no section of wage earners or salary earners is put at a relative disadvantage with regard to any other section of comparable skill and attainment.
The Spens Committees' Reports were accepted by the Government of the day and were expected to provide a basis for the entry of doctors into the National Health Service. Mr. Bevan, when Minister of Health in the previous Government, said in 1950 that the Spens principle had served its original purpose and could not be regarded as the basis for remuneration for all time. I think that that is true, and what, in the Government's opinion, is needed now, after eight years of experience of the workings of the National Health Service, is to determine the proper place of the medical profession in relation to other skilled professions which make up our society and, when that is done, to fix the scale of remuneration, after authoritative and up-to-date findings by a Royal Commission. We believe that the Royal Commission can be the proper instrument. It can take into account all the circumstances that are relevant, and one of the factors which is clearly relevant is consideration of the Spens Reports.
In answer to the noble Lord, Lord Moran, I would say that if the doctors wish to put before the Royal Commission their interpretation of the Spens Reports, there is no reason why the Commission should not listen to and consider their views upon them. Clearly, the Royal Commission will take into account
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rewards for skill in other comparable professions and, equally, the special conditions of a doctor's life—the long and irregular hours; the load of responsibility, great in human terms, of which the noble Lord, Lord Moran, and others spoke; and the financial factors, which affect recruiting to a profession which is of such vital importance to the community.
EARL JOWITT: My Lords, the noble Earl has made these statements, but I am looking at the terms of reference, and may I tell him, with the greatest respect, that I do not think that he is right? Of course, that depends entirely on the construction of the terms of reference. Will the noble Earl at least do this? After the debate is over, will he make certain that he takes legal advice to find out whether he is right in what he says. I do not think that he would like to make these statements and then find out that he is wrong.
THE EARL OF HOME: My Lords, I have taken the advice of the Minister of Health on this matter before saying what I have said, and I am advised that what I have said falls within the terms of reference given to the Royal Commission.
Although the Royal Commission will act with every expedition, the Government thought that some recognition should be given to the difficulties which face the doctors meanwhile. A 10 per cent. increase has been given in respect of junior hospital staff, and the Prime Minister announced a short time ago that the Government are considering what should be done about a further interim adjustment for the senior hospital staff and general practitioners, both medical and dental, and he hopes to be able to make an announcement on that shortly. Against the background of the country's financial position, and taking into account the fact that the doctors' claim is of such a size that it would affect the incidence of taxation, I suggest that, both from the point of view of the doctors and from the point of view of the public, the interim assistance which I have just indicated, to be followed by a Royal Commission, is a fair way of dealing with this problem.
There have been certain other criticisms of the terms of reference of the Royal Commission. It is right that they should be examined critically. I do not

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think that we can give the Royal Commission vague terms of reference. Probably the noble and learned Earl, Lord Jowitt, will remember that in 1910 there was a Departmental Committee on Royal Commissions. One passage in their Report says:
" One of the chief securities of deriving full advantage from an inquiry by Royal Commission and one of the essential requirements of obtaining definite results…is that very great care should be taken to ensure that the subject of inquiry which it is intended to submit to the Government should be set out in unambiguous terms."
That my right honourable friend the Minister of Health has attempted to do, and in such a way that the terms are not so broad as to lead to an endless inquiry, with vague recommendations, yet not so narrow as to exclude anything which is relevant to the doctors' needs.
One of the points raised on the terms of reference was the question of delay. I have dealt with that. The Royal Commission have already held a number of sittings and the chairman has every intention that the Commission shall act with speed. There has been a criticism, not made to-day in your Lordships' House but outside, that there are no doctors or dentists on the Royal Commission. My right honourable friend took the view that, on the whole, they would be more valuable as witnesses, and so long as the Royal Commission had competent and able people on it, it was a good body, which would be seen to be impartial. It has also been asked why, if the terms of reference propose comparison with the remuneration of other professional classes, they did not also include a direction to take into account remuneration in commerce and industry. My right honourable friend thought that, had there been a direction to that effect, it would have meant an immensely long inquiry, and there is a great field in industry and commerce in which conditions are not comparable at all. In any case, the matter remains for the Royal Commission to decide, and there is no reason to think that they will not put a realistic interpretation upon their terms of reference, nor any doubt that they will listen to any evidence put before them which is relevant.
Then there is the question of merit awards, a matter which was raised by the noble Lord, Lord Moran. I understand
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that the Royal Commission will normally be concerned with the levels of medical and denial remuneration and not with the methods, as such. Whether they will find it necessary to look at the question of merit awards in order fully to discharge their term of reference will be for them to decide.
So, my Lords, it is the hope of my right honourable friend that the interim help which has been given to the profession, followed by a Royal Commission, armed, as he believes, with fair terms of reference, which will enable them to take into account all those matters which are relevant to the doctors' future, is the right and fair way of dealing with this. It is the Government's hope, as it was the hope of the noble and learned Earl, that we should be able to move away from the atmosphere of distrust, of accusations of bad faith, of trials of strength and non-co-operation with the Royal Commission and with the Health Service, because that seems to all of us to be quite out of character in a profession recognised everywhere for its sense of responsibility.
But if that is true, it is equally true that the community, who are the new employers, should not trade on the tradition of patience and good will of the doctors. As the noble and learned Earl said, there must be give and take; there must be understanding and sympathy on both sides. It is the Government's desire that there should be a settlement, rapid, fair and comprehensive, and we believe that the Royal Commission is the method which will most surely reach these results. The Commission have been appointed. They are already pursuing their task, and we hope that after they have finished and have reported, we shall be able to arrive at a permanent settlement which will end for the doctors this rather unhappy chapter in their affairs.
4.30 p.m.
LORD MORAN: My Lords, whilst I am grateful to the noble Earl for his reply, I must acknowledge at once that I am profoundly disappointed in its substance. I gave him notice of two questions, neither of which he has really answered in any way satisfactorily to the doctors. On the minor question of awards, he simply says that that is for the Royal Commission to settle. In other words, this question of remuneration of consultants may be torn up by the roots,

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and much that has been done in the last seven years may be thrown away.
But the more important question that I asked was whether, in fact, the Royal Commission would be entitled to look into the terms of the Spens Committee. The answer of the noble Earl, at first, seemed to be satisfactory: that there was no reason why the Royal Commission should not listen to and consider the doctors' evidence on it. That would be satisfactory. But I understand that a Royal Commission are strictly bound by their terms of reference. It is not the Minister of Health who will advise what those terms are; he has not the power. It is for the Chairman of the Royal Commission. If the Royal Commission decide that this is outside their ambit, nothing will happen. In other words, I go away by the same door by which I came in, with no surety about the awards, and nothing whatever on this matter of the Spens terms.
What we want now is straightforward dealing with the doctors. They primarily want to know whether or not the undertakings given to them at the time of the Spens Committee will be taken into account by the Royal Commission. The noble Earl gave us no reassurance on that point. Therefore, while, as I said before, I am grateful to the noble Earl, I go away profoundly apprehensive about the future. What the doctors are concerned with is that they should be allowed to put before the Royal Commission everything that they think relevant, and should not be prevented from doing so. I beg to withdraw the motion for Papers.
Motion for Papers, by leave, withdrawn.
BARCLAYS BANK D.C.O. BILL
CATTEDOWN WHARVES BILL
CITY OF LONDON (VARIOUS POWERS) BILL
MARINE SOCIETY BILL
SUNDERLAND CORPORATION BILL
Brought from the Commons; read 1a, and referred to the Examiners.

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