Sitting of 4 February 1964

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
PRIVATE BUSINESS
  NORFOLK ESTUARY BILL (By Order)
  Second Reading deferred till Tuesday next at Seven o'clock.
  PRESTON CORPORATION BILL (By Order)
  Read a Second time and committed.
  SAINT GEORGE HANOVER SQUARE BURIAL GROUND BILL (By order)
  Second Reading deferred till Thursday.
ORAL ANSWERS TO QUESTIONS
  NATIONAL FINANCE

    Tax Allowances (Dependent Relatives)
    Mr. Ridleyasked the Chancellor of the Exchequer what evidence is required by the Commissioners of Inland Revenue to prove the existence of dependent relatives abroad for whom United Kingdom Income Tax allowances are claimed.
    The Financial Secretary to the Treasury (Mr. Alan Green): This varies with the allowance claimed. For wives and children marriage and birth certificates are normally called for. Where it is not practicable to insist on such certificates, alternative evidence such as an affidavit sworn by the dependant before a local magistrate is required; and a similar test would normally be applied for other dependent relatives abroad.
    Mr. Ridley: Is my hon. Friend aware that some immigrants seem to have an inordinate number of dependent relatives still living abroad and that some solicitors who swear affidavits may not be of such impeccable standards when
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    they live abroad rather than here? Will my hon. Friend urge the Chancellor to look into this matter from the point of view that some immigrants seem to be paying no tax at all due to this cause?
    Mr. Green: I can assure my hon. Friend that the Inland Revenue has considerably strengthened its defences against unreasonable claims in recent years.

    Bank Notes (Security in Transit)
    Mr. Gresham Cookeasked the Chancellor of the Exchequer what decision has now been reached regarding the desirability of defacing bank notes, due for destruction, before they are sent to London for pulping.
    The Chancellor of the Exchequer (Mr. Reginald Maudling): This matter, and the whole problem of the security of bank notes in transit, is under continuous examination by those concerned.
    Mr. Gresham Cooke: Would my right hon. Friend ask the Bank of England or the committee dealing with it to deal with the matter quickly because millions of used banknotes are coming back by train each week to London? There is a simple machine which can be used by provincial banks for defacing them, and in view of the two robberies last year in Aylesbury and Cardiff of over £2½ million, should not this machine be brought into use quickly?
    Mr. Maudling: I will certainly call that to the attention of those concerned.

    Civil Servants (Industrial Training)
    Mr. Boydenasked the Chancellor of the Exchequer, following the proposals in the Industrial Training Bill, what new steps he is taking to ensure that all industrial civil servants under 18 receive both day release and suitable industrial training.
    Mr. Green: Day release is already an integral past of the training of apprentices who are about two-thirds of the total of young people in Government industrial establishments, and Departments are progressively recruiting more apprentices. Other young people are given suitable industrial training and are encouraged to continue their education by day release up to and sometimes beyond 18.
    Mr. Boyden: What steps are being taken about the one-third—the unskilled and semi-skilled workers—so that they will attend day release up to the age of 18 and will thus get much better training than they are now getting in some quarters of the Civil Service?
    Mr. Green: I can assure the hon. Gentleman that Government Departments are concerned and do their level best. We take the view that often better results are got by persuasion than by compulsion; and persuasion is certainly being used.
    Mr. Manuel: Is the Financial Secretary satisfied that there are enough establishments giving day release training to make this completely operative throughout the country?
    Mr. Green: I would require notice of that question.

    Speculative Gains Tax
    Mr. Ridleyasked the Chancellor of the Exchequer when he will publish the yield of the speculative gains tax for the year 1962–63.
    Mr. Green: Figures should be available in about a year.
    Mr. Ridley: Is the Financial Secretary aware that that is a long time to wait for the results of this very important tax? Is he further aware that in some quarters in the City it is now beginning to be realised that this tax has been of advantage to the speculator, who can write off his losses against the payment of tax under this head? Will he ask his right hon. Friend to look very closely at it again in the coming Budget?
    Mr. Green: I can certainly promise continuous examination of this and all forms of taxation, but, in response to the earlier part of my hon. Friend's supplementary question, I am afraid that this is the way in which the system works.
    Mr. Callaghan: Is not the real position that the tax results in no revenue and that it does not diminish in any way the number of speculative transactions? Will he not now agree that it was a sham that should never have been introduced in the first place?
    Mr. Green: I can only advise the hon. Gentleman not to speculate in advance of knowledge of the facts.
    Mr. Callaghan: Will he tell us, since the Treasury must have collected some revenue already, how much has been collected?
    Mr. Green: That is not the Question on the Order Paper. Perhaps the hon. Gentleman would care to study the Order Paper before asking supplementary questions.

    Schedule A
    Mr. Wadeasked the Chancellor of the Exchequer what is the total number of demands for Schedule A Income Tax that have been sent out for the current year.
    Mr. Green: About 3¾ million.
    Mr. Wade: Is the hon. Gentleman aware that considerable confusion and concern have been caused by the receipt of demands for Schedule A, even though in some cases they have been accompanied by an explanatory memorandum? In the hope of clearing up this confusion, may I ask two simple questions? First, is it true that in the current tax year the owner-occupier of freehold premises no part of which is let has no liability to any Schedule A tax, and, if so why have the demands been sent? Secondly, is it not correct that after 6th April, 1964, no one will be liable to any Schedule A tax and that after that date Schedule A tax will be finally abolished?
    Mr. Green: If demands have been incorrectly sent, that is quite wrong and apologies will be made in any such cases. I should like to know of any such case, and perhaps I may have details of it. In response to the second question, perhaps I can best help the hon. Gentleman by referring him to my right hon. Friend's statement of 3rd April, 1963, column 457–8 of the OFFICIAL REPORT. If he remains in doubt, having read that original source of information, perhaps he will communicate with me.
    Mr. Stratton Mills: When letters are written to the collectors of taxes on matters arising out of demands for Schedule A, will my hon. Friend encourage them to reply to such correspondence?
    Mr. Green: So far as I know, they do, but again, if my hon. Friend has any case in mind, I am sure that I can be of help to him if only he will tell me what it is.
    Mr. Rankin: Is it not the case that owner-occupiers in Scotland who pay feu duty will continue to pay Schedule A tax?
    Mr. Green: The position after this year will be that the owner-occupier paying either ground duty or feu duty will pay the full amount of that ground rent or feu duty, without deduction of tax, to the ground landlord who, in his turn, will be responsible for any tax that properly falls upon it.
    Mr. Callaghan: Is it not also the case that the person who pays the ground rent will not be able to regard it as a charge on his income next year and, to that extent, will be worse off than he has been so far?
    Mr. Green: Rent has never been regarded in the light in which the hon. Gentleman is apparently now suggesting it should be regarded. It is a perfectly proper expense incurred by people on whom it falls to pay it, and there are no grounds for thinking differently now.

    Educational Services (Costs)
    Mr. Dudley Smithasked the Chancellor of the Exchequer what proposals he has for transferring part of the present cost of the educational services borne by local authorithes to the national Exchequer.
    Mr. Maudling: None, Sir.
    Mr. Smith: Is my right hon. Friend aware that, because of the massive and welcome increase in educational expenditure, the effect on the rating system is becoming more and more disproportionate? Does he not agree that eventually much more of the cost of education must, in all conscience, be borne at the centre?
    Mr. Maudling: As my hon. Friend knows, we have decided to undertake a comprehensive review of central and local government financial relationships, and I do not think that I should anticipate the result of that review.

    Taxpayers (Representations to Members)
    Mr. Iremongerasked the Chancellor of the Exchequer if he will cause instructions to be issued to local inspectors of taxes that taxpayers who have referred their problems and grievances to their Member of Parliament for investigation are not for that reason to be subjected to discourtesy or obstructiveness in their dealings with local officials of the Department of Inland Revenue.
    Mr. Green: No, Sir. Inspectors of taxes and their staff have standing instructions to help taxpayers in every reasonable way, and I see no justification for the allegation that is implied in my hon. Friend's Question.
    Mr. Iremonger: As my hon. Friend has been good enough to say that he sees no justification for the allegation, may I refer him to correspondence which I had occasion to have with his predecessor and in which there is given a very clear example of this sort of thing?
    Mr. Green: I understand that my predecessor, now my right hon. Friend the Minister of Health, sent a full reply to my hon. Friend explaining that no discourtesy was intended.

    Public Service Pensioners Council
    Mr. John Hallasked the Chancellor of the Exchequer what replies he has given to the proposals he has received from the Public Service Pensioners Council for the adjustment of pensions at 1st January, 1964.
    Mr. Maudling: My right hon. Friend the Chief Secretary saw a deputation from the Council on 26th November. He said that he saw no grounds for a further increase in public service pensions so soon after the considerable increases in the Pensions (Increase) Act, 1962.
    Mr. Hall: Would not my right hon. Friend agree that when public service pensions were fixed it was intended to entitle the pensioners to a certain standard of living on retirement? Would he not also agree that pensioners are not able to exercise the same pressures as other sections of the community to

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    safeguard themselves against changes in the value of money? Therefore, should there not be some formula which would keep the purchasing power of the pension in real terms without the necessity each time to introduce pensions increase legislation which hon. Members on both sides of the House believe to be an outdated procedure?
    Mr. Maudling: I doubt whether an automatic formula of that kind would be for the benefit of the pensioners in the long run. Successive pensions increase Measures have provided for the pensioners concerned in a very reasonable way.
    Mr. Houghton: Does the right hon. Gentleman remember that his right hon. Friend the Chief Secretary gave an assurance to the House, in response to considerable pressure from both sides when the Pensions (Increase) Bill was going through the House last year, that he would try to find a better way of adjusting public service pensions than having sporadic ad hoc pensions increase legislation? Has he anything to say about that?
    Mr. Maudling: What my right hon. Friend discussed with the deputation was the subject of adjustments in the near future. The point I was making was that he said in reply that the latest increases were so recent that a further immediate increase was not in his view justified.
    Dame Irene Ward: Will my right hon. Friend bear in mind that one of the difficulties of getting Service widows' pensions adjusted is that so many public service pensioners are on a standard of pension which is derisory and that it is not so much new pensions increase legislation that is required as that the older pensioners should be brought up to a standard at which percentage increases would make sense?
    Mr. Maudling: That seems to raise the very broad question of parity and goes rather beyond the original Question.

    Liquor Sales (Clubs and Staff Associations)
    Sir J. Duncanasked the Chancellor of the Exchequer how much revenue he is losing in tax from licensees through
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    the large extension of clubs, staff associations and other such bodies, who get liquor either on the premises or off materially cheaper than if they had to buy it through the normal trade channels.
    Mr. Maudling: None, Sir.
    Sir J. Duncan: Does not my right hon. Friend agree that the time has come when he ought to look again at the provision which allows staff associations, clubs, town councils and local authorities generally to evade the ordinary provisions of the law and to get alcoholic liquor, particularly at Christmas and the New Year, much more cheaply than trade prices?
    Mr. Maudling: That question goes rather beyond my responsibility. The Question put to me was concerned with the revenue and I can only say that we suffer no loss of revenue by these arrangements. Whether for other reasons they are good or bad is a question for my right hon. Friend.
    Sir J. Duncanasked the Chancellor of the Exchequer how much revenue he estimates he is losing from the sales of liquor by registered clubs to nonmembers.
    Mr. Maudling: None, Sir.
    Sir J. Duncan: What steps has my right hon. Friend taken to see that these clubs and others do not sell to non-members? Is he aware that the Customs and Excise is in close contact with the police so that cases like this can be followed up and prosecuted?
    Mr. Maudling: I understand my hon. Friend's point. Once again I can answer only for the revenue and say that it does not lose by this. The enforcement of the rules about sales to non-members is a matter for my right hon. Friend, and I will call his attention to what has been said.
    Sir J. Duncan: Is my right hon. Friend aware that these questions were prompted by some members of the licensed trade, a very respectable body of people, whose books are checked by the Customs and Excise and who are subject to very strict licensing laws and who resent other people coming in and taking a large amount of their profit,

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    which results in my right hon. Friend losing Income Tax which he would otherwise collect?
    Mr. Maudling: I see the point. The position is that I am responsible for safeguarding the revenue white responsibility for the enforcement of the law rests with my right hon. Friend the Home Secretary. I will call his attention to my hon. Friend's remarks.
    Mr. Marsh: Would it not be illogical for the Government to interfere in this practice when their policy in respect of resale price maintenance will mean its extension?
    Mr. Maudling: That seems a subtle supplementary question which hardly arises from the original Question.

    Exchequer Accounts (Reform)
    Mr. Iremongerasked the Chancellor of the Exchequer whether he proposes to prepare and present his Budget on the lines of Command Paper No. 2014 of 1963, The Reform of the Exchequer Accounts.
    Mr. Maudling: My intention is that the Financial Statement this year should be in the same form as in previous years. But I hope to indicate in the course of my Budget statement the lines on which I think we can best make further progress in revising the form of the Exchequer Accounts and dealing with related matters.
    Mr. Iremonger: I thank my right hon. Friend for that reply. Will he try to bring out this year the financing requirement, which is, from the economic point of view, the only vital piece of information that we need to know?
    Mr. Maudling: I will certainly try to do that. This is not an easy problem to solve. The difficulty is to give the House as guardian of the public purse the necessary financial information and at the same time to give the House and the public the necessary economic picture.
    Mr. Callaghan: Is the right hon. Gentleman aware that under the Provisional Collection of Taxes Act he must introduce his Budget by 4th May? May we take it that that is his intention?
    Mr. Maudling: That seems to me to arise on a later Question.

    Dog Licences
    Sir M. Stoddart-Scottasked the Chancellor of the Exchequer how many dogs are licensed in the United Kingdom; what income he receives from their licences; and what is the cost of collecting this tax.
    Mr. Green: In 1962–63, 2,598,488 dogs were licensed in England and Wales and 194,418 in Scotland. In Northern Ireland dog licensing is the responsibility of the Government of Northern Ireland. Only the yield of licences issued in Scotland is paid into the Exchequer: in 1962–63 this yield was £72,855. To produce figures showing the cost of collecting dog licences would require a disproportionate amount of work.
    Sir M. Stoddart-Scott: Will my hon. Friend ask his right hon. Friend the Chancellor of the Exchequer if, when he prepares his Budget, he will look at this licensing tax and whether he will deal with it in the same way as he dealt with licensing for the sale of tobacco in his last Budget?
    Mr. Green: I will pass that message on to my right hon. Friend.

    H.M. Stationery Office (Sales Centres)
    Mr. Milneasked the Chancellor of the Exchequer if he will list the sales at each of Her Majesty's Stationery Office centres in Great Britain for 1963, and the comparative figures for the preceding 12 months.
    Mr. Green: As the Answer contains a number of figures, I will, with permission, circulate the details in the OFFICIAL REPORT.
    Mr. Milne: I am grateful to the hon. Gentleman for providing these figures. Will he note that Newcastle-upon-Tyne will not be included in this list and that his reply to me on 3rd December about setting up a stationery office in Newcastle was slightly misleading in that retail sales to the public are not made in Newcastle? Will he look into this matter and ensure that we have a branch of Her Majesty's Stationery Office in Newcastle which includes sales to the public?
    Mr. Green: All I can say is—and hope that I am repeating what I said

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    to the hon. Gentleman on the last occasion—that the door is not closed to such an establishment if the work would appear to justify it. I assure the hon. Gentleman that this matter is under constant review.
    Mr. Gresham Cooke: Will my hon. Friend also think of putting among those figures the reduction in the value of sales which may take place next year if resale price maintenance on the production of Her Majesty's Stationery Office is abolished?
    Mr. Green: I think I had better not enter into a double guessing game at Question Time.
    Following is the information:

    Government Bookshops

    Total Sales

    1962

    1963

    £

    £

    London

    …

    1,167,373

    1,277,869

    Edinburgh

    …

    82,580

    110,986

    Cardiff

    …

    29,148

    35,864

    Manchester

    …

    106,238

    127,619

    Birmingham

    …

    40,320

    52,161

    Bristol

    …

    33,020

    38,872

    Total

    …

    £1,458,679

    £1,643,371

    These figures include mail order and trade business, most of which is conducted from London.

    West Germany (British Troops)
    Mr. Fernyhoughasked the Chancellor of the Exchequer if he will make a statement on his recent talks with the Federal German Minister of Finance on the cost of stationing British troops in West Germany.
    Mr. Maudling: My right hon. Friend the Chief Secretary to the Treasury visited Bonn on 3rd December, 1963, for discussions with the Federal German Minister of Finance, Dr. Dahlgrün, about the implementation of the Agreed Minute of 6th June, 1962, on this subject. At the same time he stressed the need for new arrangements regarding the foreign exchange costs of British forces in Germany, when the period covered by the Agreed Minute ends on 31st March, 1964. Both sides hoped that it would be possible to find solutions to all outstanding problems.
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    I have arranged for a copy of the communiqué issued after these talks to be placed in the Library. German and British officials will meet in London in the near future for further discussions on the implementation of the Agreed Minute, and Dr. Dahlgrün has been invited to visit London in March to continue his discussions with the Chief Secretary.
    Mr. Fernyhough: Does not the right hon. Gentleman think it time that we tried to come to a firm and permanent understanding about these costs? Does not he think it rather humiliating that representatives of Her Majesty's Government should constantly have to go cap in hand and beg the Germans to observe their part of the agreement? If we cannot afford to keep these troops in Germany and the Germans refuse to make the contribution which they have promised, will the right hon. Gentleman think in terms of reducing the numbers of troops?
    Mr. Maudling: This procedure is working out well. I do not accept the suggestion that we are constantly going cap in hand to Germany. My right hon. Friend the Chief Secretary has been to Germany and Dr. Dahlgrün has been invited to visit London. This is the way that these things should be worked out between Governments.
    Sir C. Osborne: How much is it costing us to keep our troops in Germany? Since this cost must obviously put an added strain on our balance of payments position, under what condition may we expect, one day, the troops to be brought home?
    Mr. Maudling: As I said in my Answer, the German Government have given us to understand that the agreed minute will be carried out by 31st March, 1964. During his recent visit Dr. Erhard undertook that his Government would give the subject of what happens after that their urgent and sympathetic consideration.

    Retirement Pensions (Taxation)
    Dr. Alan Glynasked the Chancellor of the Exchequer what estimate has been made of the loss of revenue if retirement pensioners, over the age of

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    70, received their pension without deduction of tax, irrespective of other sources of income which they may have.
    Mr. Green: National Insurance retirement pensions are paid in full without deduction of tax, but they must be taken into account as part of the recipient's income in computing his tax liability, if any. The cost of exempting such pensions paid to people over 70 who have other income might be about £10 million a year.
    Dr. Glyn: I thank my hon. Friend for that Answer. Would not he agree that some of these sums which have to be recovered from pensioners over 70 years of age are very small and that the administrative costs of collecting them are high? Will he ask his right hon. Friend tae Chancellor of the Exchequer to consider putting this measure in his Budget, although I realise that it is a departure from normal taxation principles?
    Mr. Green: Because these pensions are a form of income, like other pensions, I cannot see sufficient ground to single them out for special exemption.

    Rucksacks (Tax)
    Mr. Boydenasked the Chancellor of the Exchequer what is the current Purchase Tax yield on rucksacks.
    Mr. Maudling: I regret that there is no separate information about the yield of tax from rucksacks.
    Mr. Boyden: Will the right hon. Gentleman look at this tax with a view to removing it in the next Budget? Is is not absurd that the Ministry of Education spends large sums of money on encouraging young people to take part in open-air activities and then the Chancellor of the Exchequer takes the money back from them when they pursue these activities?
    Mr. Maudling: I cannot speculate on what the Budget may or may not contain, but I will consider what the hon. Member has said.

    Lorries (Licences)
    Mr. Wingfield Digbyasked the Chancellor of the Exchequer what was the yield of the licences for heavy lorries
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    of 10 tons burden and over for the last financial year.
    Mr. Green: Precise figures are not available. An estimate of the yield from these vehicles based on a survey indicates an annual revenue of approximately £600,000.
    Mr. Digby: Is my hon. Friend aware that some of us doubt whether these vehicles are making a full contribution towards the cost of the wear and tear that they cause to the roads, particularly in view of the problem which their proliferation is causing to the railways and the constant loss to the Revenue?
    Mr. Green: I understand my hon. Friend's point, but I think that it is very difficult to establish with any equity or accuracy what rates of licence duty for different classes of vehicle would precisely reflect the road costs for which each is responsible. This is a real difficulty.
    Mr. Jay: Can the hon. Member say when last there was an increase in this rate of duty?
    Mr. Green: I cannot offhand, but I will write to the right hon. Gentleman about it.

    Soft Drinks (Tax)
    Mr. Wingfield Digbyasked the Chancellor of the Exchequer what is the yield on the tax on soft drinks during the present financial year.
    Mr. Maudling: The Budget estimate for the current financial year included £15 million in respect of purchase tax on soft drinks. Receipts to 31st December, 1963, amounted to about £10½ million.
    Mr. Digby: I realise that this is a substantial contribution to the Revenue, but will my right hon. Friend bear in mind that this tax is causing a great problem for many small drinks manufacturers who provide useful employment in small towns?
    Mr. Maudling: I have had representations from bodies representing this industry, and I am considering them, but clearly I cannot comment on them at this moment.

    Bus Fuel Oil (Tax)
    Mr. Doigasked the Chancellor of the Exchequer if he will now reduce the fuel tax for public service buses to the same amount as for other industries and diesel trains, namely twopence per gallon.
    Mr. Frank Allaunasked the Chancellor of the Exchequer if, in view of the emphasis laid in the Buchanan Report on making public transport relatively cheap, he will consider, when preparing his Budget, reducing the 300 per cent. tax on bus fuel oil.
    Sir C. Osborneasked the Chancellor of the Exchequer if he will give favourable consideration to the request for a reduction of the 300 per cent. tax on bus fuel oil from the Grimsby and Cleethorpes Joint Transport Committee, which is paying over £50,000 a year in tax and, though losing thousands of pounds every year, is faced with another claim for wage increases; and if he will make a statement on the letter sent to him by the hon. Member for Louth from the Committee.
    Mr. Maudling: I have received a number of representations about the duty on fuel oil used in buses and I am considering them carefully, but I cannot anticipate my Budget.
    Mr. Doig: Is not the right hon. Gentleman aware that the Minister of Transport and the Buchanan Report both stress the vital necessity of encouraging more people to use public transport? Is he not also aware that the Underground has now become dangerously over-crowded? Is he not further aware that this heavy tax does not help the process of encouraging people to use public transport, which is much more economical in the use of road space than private cars?
    Mr. Maudling: These are arguments which are advanced by those who wish to see this tax reduced, but the hon. Gentleman will not expect me to comment on their validity or otherwise at this time.
    Mr. Allaun: While we do not expect the right hon. Gentleman to comment on their validity, does not he think that 2s. 6d. a gallon is a really extortionate and unreasonable tax? Does not he also
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    agree that a bus which can carry 60 passengers occupies perhaps only twice as much space as a private car and that the increase in the number of private cars is slowly bringing traffic to a halt in our main cities?
    Mr. Maudling: The hon. Gentleman began by saying that he would not expect me to comment on the validity of these arguments and then proceeded to ask me whether I did not think they were right.
    Sir C. Osborne: Is my right hon. Friend aware that £50,000 is a lot of money to take in this way from relatively small communities like Grimsby and Cleethorpes? Does not he agree that, since new housing estates are being built outside the centres of these places, and mostly young married people are going to live there, the extra cost entailed in travelling to the shops is an unreasonable burden? Will he look at this question from that point of view?
    Mr. Maudling: I cannot say more than that these are really serious arguments advanced by people on a serious basis and that I will consider them. But I cannot go further than that at the moment.
    Mr. Hilton: Is the right hon. Gentleman aware that people in the countryside would welcome the reduction of this tax in the rural areas, where public transport is so limited and where, by the time the Beeching proposals are implemented, the situation will be much worse? While I appreciate that he cannot tell us in advance what his Budget will contain, will he bear the rural people in mind?
    Mr. Maudling: I will certainly bear them in mind, but I cannot say what the result will be.

    Gymnasium Equipment (Tax)
    Mr. Benceasked the Chancellor of the Exchequer what was the yield of Purchase Tax on gymnasium equipment over the last financial year.
    Mr. Maudling: I regret that there is no separate information about the yield of tax on gymnasium equipment.
    Mr. Bence: Is the right hon. Gentleman aware that I am surprised that he has not the figures, because we debated

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    this last year? Will not he scrap the tax altogether, since it has already been removed from a great deal of sporting equipment? Is he aware that this differentiation between various items of sports equipment is nonsense?
    Mr. Maudling: I will study that point.

    Developing Countries (Aid)
    Mr. Prenticeasked the Chancellor of the Exchequer why economic aid from this country to developing countries amounted to £74·8 million during the first half of the current financial year, in view of the fact that the White Paper, Aid to Developing Countries, published in September, 1963, included an estimate that the total for the whole year would be within the range of £180 million to £220 million.
    Mr. G. M. Thomsonasked the Chancellor of the Exchequer what steps he is taking to increase the flow of aid to developing countries to meet the target of £180 to £220 million announced by Her Majesty's Government in the recent White Paper on Overseas Aid.
    Mr. Maudling: The figure of £180 million to £220 million given in the White Paper was not a target figure but a tentative estimate of the range within which expenditure on aid might fall in 1963–64. It is too early to give a firm forecast for the year as a whole. As the White Paper (Cmnd. 2147) made clear, the timing of aid expenditure as distinguished from commitment does not rest with us, but depends largely on the rate at which the recipients spend what we give them.
    Mr. Prentice: Does the right hon. Gentleman expect an increase in the second half of the current financial year? If not, is there not clearly a growing gap between what the Government intended to happen and what is actually happening? Does not this show the case for an overhaul of the aid programmes, which can only be done by having one Minister in charge instead of the present six or seven, each with a finger in the pie?
    Mr. Maudling: This is not what is happening. Our commitments are on a rising curve, but the rate at which the people who receive the aid spend the
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    money depends upon them. I would like to see the actual expenditure of this aid closer in line with the commitment, but that rests with those who are getting the benefit.
    Mr. G. R. Thomson: Is the right hon. Gentleman aware that this is the second year in which this situation has arisen? Last year suggestions were made to try to prevent recurrence of the situation. Is the Treasury following up those suggestions in order to try to ensure that aid not absorbed is transferable to other purposes? Can the right hon. Gentleman say why the estimate in the White Paper was so greatly in excess of what is likely to happen?
    Mr. Maudling: We are doing our duty by offering people aid. It is growing, and has grown in recent years, very much. I should be very glad to see the rate of spending of this money more in line with the rate at which we offer it, but it does not rest entirely with us.
    Mr. P. Williams: Will my right hon. Friend make it clear that Government aid is not the only way of helping developing countries and that private enterprise can help, provided that political and economic conditions are right? In these circumstances also, is not Britain playing her full part?
    Mr. Maudling: I entirely agree.

    Coast Preventive Men (Motor Vehicles)
    Mr. T. W. Jonesasked the Chancellor of the Exchequer if he will arrange for coast preventive men to have light vans instead of motorcycles.
    Mr. Green: Trials to establish the relative merits of light cars and motorcycles for use on patrols by coast preventive men have already been arranged. I will let the hon. Member know the result as soon as they have been completed.

    Dairy Farmers
    Mr. Websterasked the Chancellor of the Exchequer if he will refer the income of dairy farmers to the National Incomes Commission.
    Mr. Maudling: No, Sir.
    Mr. Webster: Is my right hon. Friend aware that in the last five years the average dairy farmer's income has gone down 14 per cent. whereas his average unavoidable costs have risen by 30 per cent.? Would it not be a good thing to consider for a change an industry whose income has gone down?
    Mr. Maudling: That sounds like the opening shots at the Farm Price Review.

    Strike Pay (Tax)
    Sir C. Osborneasked the Chancellor of the Exchequer whether he is aware that men on strike receive strike pay of up to £20 per week; and to what extent such payments are liable to Income Tax.
    Mr. Green: Strike pay received by members of trade unions is not liable to Income Tax, but I think that my hon. Friend is possibly exaggerating the level of such pay.
    Sir C. Osborne: Is my hon. Friend aware that in the Sunday Times two weeks ago it was stated that the men on strike at Port Talbot were receiving £20 a week? Is it not unjust that such pay should be free of tax when it is practically double what an agricultural worker gets for a full week's work?
    Mr. Green: With respect, I do not think that the figure of £20 has very much to do with the level of strike pay received. It is possible that my hon. Friend and I are differing about the meaning of a word here.
    Mr. Callaghan: Whatever the level of strike pay, would it be right to tax it if the original contributions to the union remained untaxed? In other words, should not an allowance be made for the original contribution if it was intended to tax the product of it?
    Mr. Green: The hon. Gentleman has his tax principles right on this occasion.
    Sir C. Osborne: Is my hon. Friend aware that agricultural workers earn about half this sum and will regard it as unjust if they have to pay tax on their earnings while strike pay on this scale is free of tax?
    Mr. Green: I do not think that I can help my hon. Friend any further at this moment. If he would care to talk to
    968
    me about the principle upon which these taxes are raised or are not raised, I shall be glad to have a word with him.
    Mr. J. Morris: Will not the Financial Secretary agree that the statement by the hon. Member for Louth (Sir C. Osborne) is a gross exaggeration of the case at Port Talbot and that he should have some responsibility for what he is saying? Is the hon. Gentleman aware that the strike pay is nearer £2 10s. than £20?
    Mr. Speaker: Order. Ministers have to answer for lots of things, but not about the responsibilities of hon. Members behind them.

    Armament Expenditure
    Mr. Frank Allaunasked the Chancellor of the Exchequer, in view of his objective of reducing armament expenditure, why Her Majesty's Government forecast an increase of £265 million per year in such expenditure by 1967–68.
    Mr. Maudling: This figure, like all the others in the White Paper, is an approximate calculation of the prospective level of expenditure in 1967–68 on the basis of present policies and programmes; it does not represent a Government decision to spend this sum in that year.
    Mr. Allaun: Why cannot the Government cut the arms burden as America and Russia are doing and as the Prime Minister is continually stating that they will do? Why at least cannot they freeze the present level instead of increasing it by £100 million a year? Are the demands of the military sacrosanct for so-called defence?
    Mr. Maudling: The demands of national defence are sacrosanct, which is not the same thing as the demands of the military. It is difficult to calculate ahead expenditure on defence. We all hope that there may be opportunities for reductions of armaments but on the other hand, as we have seen in the last few months, there are dangers of unforeseen increases. We think it right in working out the pattern of Government expenditure a few years ahead to assume that the proportion taken by defence will be about the same as at present.
    Mr. Awbery: May I ask the right hon. Gentleman what economic theory he has been studying, whether it is Marshall or Marx, by which he can promise a reduction in his Budget and then proceed to increase the amount by £235 million? Are we to understand that in future when the Government say that there is to be a reduction there will be an increase, and when they say there is to be an increase there will be a reduction?
    Mr. Maudling: I think that the hon. Gentleman is a little confused. That question should be addressed to his hon. Friend.

    Building Societies (Interest Rates)
    Mr. Marshasked the Chancellor of the Exchequer if he will take steps to control building society interest rates charged on mortgages to house purchasers.
    Mr. Maudling: No, Sir.
    Mr. Marsh: May I ask the right hon. Gentleman whether he does not consider that when these building societies affect, as they do, about 2½ million borrowers, with a total borrowed of about £3,000 million, and when societies as reputable as the Halifax Building Society can reduce their rates, he has some responsibility to exert some influence?
    Mr. Maudling: I think that building society charges on the money they lend are determined by what they have to pay in a competitive market for what they borrow.
    Mr. Marsh: With respect to the right hon. Gentleman, my Question is whether the Government will accept some responsibility for some degree of control over an organisation which has this large influence on the economy of this country? If some reputable building societies can reduce their rates, why should the Building Societies Association prevent others from reducing their rates?
    Mr. Maudling: I think that the word "control" is misleading. The only way to get the rates to borrowers down, compared with the rates that societies have to pay, is by providing a subsidy. If
    970
    the hon. Gentleman means a subsidy, let him say so.
    Dr. Bray: If the right hon. Gentleman is prepared to call into consultation people on the control of prices, wages, and profits, why should he exempt the money market on interest rates?
    Mr. Maudling: I think that we are far from lacking in consultation with the people concerned in the money market. But the principle underlying this is common sense. If building societies have to pay x per cent. for the money they borrow, they have to charge a related percentage on the money they lend.

    Prestwick Airport (Tax-free Zone)
    Sir T. Mooreasked the Chancellor of the Exchequer what is the result of the consultations he has had with other Departments concerned and the local authority regarding the possible establishment of a tax-free zone at Prestwick Airport.
    Mr. Maudling: The consultations are well advanced and I understand that the local authority considered the position at its council meeting last Tuesday.
    Sir T. Moore: I thank my right hon. Friend for that reply, but may I ask him whether he would agree that the very existence of a tax-free zone at the airport would be an enormous inducement to new industries to settle in the district and so relieve the general unemployment situation in the county?
    Mr. Maudling: I think that it would be wrong to comment overmuch on this. Consultations have been going on and this matter has recently been considered by the local authority, but we are not sure of its present view.

    Northern Ireland (Imperial Contribution)
    Mr. Leeasked the Chancellor of the Exchequer what machinery exists to assess the size of the Imperial contribution paid by the Government of Northern Ireland; and what factors are taken into account for the assessment.
    Mr. Delargyasked the Chancellor of the Exchequer how the amount of

    971
    the Imperial Contribution paid to the Exchequer by the Northern Ireland Government is determined.
    Mr. Green: The Joint Exchequer Board, established under Section 32 of the Government of Ireland Act, 1920, and consisting of a representative of H.M. Treasury and a representative of the Ministry of Finance, Northern Ireland, with an independent Chairman appointed by the Crown, determines the size of the Imperial contribution each year. Section 23 of the same Act provides that they should determine a sum which they consider to be just, having regard to the relative taxable capacity of Northern Ireland and the United Kingdom. The Board works on the general principle that, so long as rates of taxation in Northern Ireland are the same as in the rest of the United Kingdom and expenditure on Government services is also on the same levels having regard to the special needs and circumstances of Northern Ireland, the Imperial contribution should be whatever is left over of the revenue of the Northern Ireland Government after meeting their actual and necessary expenditure.
    Mr. Lee: May I ask the Minister whether he would agree that this can be used as a form of subsidy to Northern Ireland? In view of that, will he take note of the fraud case which has been heard in Northern Ireland, and at which a Committee of the Northern Ireland Government is looking but is unable to get copies of the transcript of the trial because of the lack of legislation on this issue here? Will the Minister ask his right hon. Friend whether, in view of the enormous importance of this issue to us who find certain moneys for this kind of thing, he will cause legislation to be introduced so that the Committee of the Northern Ireland Government can get copies of the transcript?
    Mr. Green: I am sure the hon. Gentleman knows that no British taxpayers' money is involved in this case. In addition, the hon. Gentleman will not expect me to comment on a matter which is within the competence of the Northern Ireland Government.
    Mr. Delargy: Can the Minister say whether the House has any control whatever over the public money which it
    972
    authorities to be spent in Northern Ireland?
    Mr. Green: If the hon. Gentleman is referring to the Northern Ireland Government's financing of their own assistance to industry, it is done entirely out of their forms of taxation and I cannot answer for them in this House.
    Mr. Delargy: I am referring to the subsidies which this Government provide to the Northern Ireland Government and the relief from taxation which is also granted in Northern Ireland.
    Mr. Green: I have tried to answer the specific case as to how finance passes between this Government and the Northern Ireland Government. I assure the hon. Gentleman that I have absolutely no responsibility for, and therefore no ability to answer on, the precise case that he has in mind.

    Concord Project
    Mr. Leeasked the Chancellor of the Exchequer whether he will now make an approach to the French Minister of Finance in order to secure joint control over the financial progress of the Concord supersonic project.
    Mr. Maudling: I very much doubt whether greater control over this project is attainable in this way, but I will discuss the report of the Estimates Committee containing a recommendation broadly to this effect with my right hon. Friend the Minister of Aviation.
    Mr. Lee: Is it not a fantastic situation that here we have at least £85 million worth of investment in an agreement which the Ministry of Aviation announced to the House and which the Treasury has never even thought of discussing with the French Government to see whether there should be a break clause, or whether the Treasury should be represented on the board controlling the finance of the Concord? Indeed, what will be the position if the French decide to pull out of the agreement? Is it not fantastic that a Government of this sort, which looks after the finances of the country in a way which is displeasing to the lower income group, can throw £85 million away in this kind of incompetence?
    Mr. Maudling: I do not think that the hon. Gentleman has understood the system of financial control in this country, which has existed for many years. The financial control of projects is not solely the responsibility of the Treasury—it tends to be more so in France—but rests also with the Department concerned.

  PALACE OF WESTMINSTER (POLICING AND SECURITY ARRANGEMENTS)
  Mr. Liptonasked the Prime Minister if he will move to appoint a Select Committee to consider policing and security arrangements for Members and their property in those parts of the Palace of Westminster appropriated to the use of Members at times when the House stands adjourned for more than one day.
  The Prime Minister (Sir Alec Douglas-Home): No, Sir. I am not aware of any dissatisfaction with the present arrangements.
  Mr. Manuel: The right hon. Gentleman has not been here long enough.
  Mr. Lipton: May I ask the Prime Minister whether he is aware that this Question arises from the theft of an hon. Member's car from the inner precincts of the Palace of Westminster at a time when the Lord Great Chamberlain is supposed to be responsible for the security of Members' property in the Palace? Does not the Prime Minister think that the time has come for hon. Members to have some little say about their domestic arrangements for the security of their property?
  The Prime Minister: I am very sorry that the hon. Gentleman's car was stolen, but very glad that it was recovered later by the police. I do not think that there is general dissatisfaction in the House with the existing arrangements.
  Mr. C. Pannell: May I ask the Prime Minister whether he is aware that he must be the only Member in the House—presumably because he has just come from another place—who thinks that the present arrangements are suitable? Is the Prime Minister aware that Members have business in this House both during the Recesses and during weekends, and that the present arrangements are com-
  974
  pletely unsuitable in that the authority of Mr. Speaker ceases when the House rises and that authority passes to the Lord Great Chamberlain who presumes to think that when the House is not sitting Members should not be here.
  The Prime Minister: I do not think that the fact that one hon. Member's car has been removed in the whole history of the House leads one to the conclusion drawn by the hon. Gentleman.
  Mr. Pannell: But is the Prime Minister aware that this is only the last of a whole series of incidents which have caused a great deal of irritation, and that even custodians under the Lord Great Chamberlain have been known to address crowds of sightseers and indicate that Members of Parliament have no right to be here on Saturday mornings? Is the Prime Minister also aware that Members have put up with insolence in many respects and that there is grave dissatisfaction which has been registered through the Serjeant at Arms and Mr. Speaker from time to time? Will the Prime Minister make some inquiries about this?
  The Prime Minister: If there is the general dissatisfaction which the hon. Gentleman says there is, I hope that he will make representations either to me or to the Leader of the House, but I am not satisfied at the present that there is general dissatisfaction with the arrangements.

  COMMONWEALTH IMMIGRANTS
  Mr. Swinglerasked the Prime Minister what consultations Her Majesty's Government have had on migration with Commonwealth Governments since the passing of the Commonwealth Immigrants Act; at what level these consultations have taken place; with which Commonwealth Governments they were held; and what have been the results.
  The Prime Minister: As I made clear in my reply to the hon. Member on 14th January, there is constant consultation with other Commonwealth Governments on the operation of our immigration control. Such consultation takes place at Ministerial or official level,

  975
  whichever is appropriate in the circumstances. Details of Commonwealth consultations are confidential.
  Mr. Swingler: Is it the Prime Minister's view that these consultations are designed to work out a Commonwealth policy on migration, or is it his view—as it is the Home Secretary's view—that each Commonwealth country should decide unilaterally its policy on migration? What is the Government's policy on this matter?
  The Prime Minister: The Government's policy is that we have to decide what this country can afford in the way of immigration from the outside Commonwealth. That is our Government's decision, but on the details of the matter we are in constant consultation with Commonwealth Governments.
  Mr. Renton: Is my right hon. Friend aware that unexpectedly large numbers of people, possessing no special skills—many of whom are unable to speak English—have been entering in the past 12 months from India and Pakistan? Will he confer with the Governments of those two countries with a view to the administrative procedures being improved at their end?
  The Prime Minister: This is exactly the kind of question about which we consult.
  Mr. Swingler: Is the Prime Minister trying to work out, through these consultations, a policy on migration within the Commonwealth, or is he resigned to the fact that no such policy is possible, and that, therefore, each country must operate its own system?
  The Prime Minister: We have tried very hard—I have tried for five years—to come to a voluntary arrangement with Commonwealth countries to limit immigration into this country. Clearly we cannot allow it to go on beyond a point at which this country can absorb it. That voluntary effort failed, and we now have to decide what we can take in consultation with all the Commonwealth countries concerned.

  EAST AFRICAN AFFAIRS
  Mr Ginsburgasked the Prime Minister what machinery exists for co-ordinating intelligence information about
  976
  East African affairs between the Foreign Office, the Commonwealth Relations Office and the Colonial Office in London and East Africa; and if he will make a statement.
  The Prime Minister: All three Departments take part in the co-ordination of intelligence about East Africa. In East Africa, Tanganyika, Uganda, Zanzibar and Kenya are fully independent countries and, as such, are responsible for their own intelligence and security.
  Mr. Ginsburg: Is the Prime Minister aware that there is some concern about the co-ordination of intelligence? Can he say whether there was any intelligence failure in recent events—any failure to pass on information? Would he care to comment on the reply of the Secretary of State for Commonwealth Relations last Thursday, to the hon. and gallant Member for Nottingham, Central (Lieut.-Colonel Cordeaux), that we had no prior knowledge about the mutinies?
  The Prime Minister: I do not think that I should like to comment on any part of that supplementary question.
  Mr. H. Wilson: When the right hon. Gentleman said, on American television, that it was all a Communist plot, was this derived from his own intelligence sources, or had he got it from the intelligence sources of the self-governing Commonwealth countries concerned?
  The Prime Minister: Perhaps the right hon. Gentleman will be a little more accurate. What I said was that these simultaneous subversive movements and attempts at coups in all four places could not really be a coincidence. I am glad that the right hon. Gentleman followed me so closely on television. He may recollect that I went on, in answer to a question whether this could be pinned on the Communist Party, to say that I did not propose to answer that question.
  Mr. Wilson: Since I did not have the advantage of seeing the right hon. Gentleman on television, but recall his answer in the House last Thursday—[Interruption.] I do not have access to American television. [Interruption.]
  Mr. Speaker: Order.
  Hon. Members: Order.
  Mr. Speaker: Calls of "Order" which do not come from me probably will not assist. I am sure that the House wants to make better progress with Questions. It had better not make so much noise.
  Mr. Wilson: Since I do not have access to American television but am able to read the British Press reports of it, and since the right hon. Gentleman reaffirmed it last Thursday and was again on the same theme in Bury last night, will he tell us—since this is so deeply ingrained in his thinking about East Africa—why he did not think of mentioning it in his statement to lsvestia last Saturday?
  The Prime Minister: My statement to lsvestia dealt with rather different points. It dealt with Anglo-Russian relations and our desire to get on better terms with the Soviet Union. I have never said—and surely the right hon. Gentleman would be very foolish to believe—that Communist countries will give up their attempts at subversion in Africa and elsewhere.
  Sir J. Eden: In the light of what has recently taken place in East Africa, can my right hon. Friend at least assure the House that there are some lessons to be learned, and that both the Commonwealth Relations Office and the Foreign Office should critically examine their own procedures and organisation, and intelligence services?

  ZANZIBAR, TANGANYIKA AND UGANDA
  Sir J. Edenasked the Prime Minister whether, in view of the threat to British Colonies resulting from the recent events in Zanzibar, Tanganyika and Uganda, he will take the initiative in proposing a regional security pact, to which all countries concerned with the maintenance of freedom and order in the continent of Africa would be invited to be party; and if he will seek to convene a special conference of these countries, with a view to adopting collective measures to combat Communist subversion in the area.
  The Prime Minister: Following recent events in East Africa we shall naturally
  978
  be in consultation with the Governments concerned. Any future steps to strengthen the security of the area must depend on what they themselves want.
  Sir J. Eden: Can my right hon. Friend say whether any request has come from these countries in Africa for some form of consultation of this kind? Does not he agree at it is very much in the interests, both of ourselves in the West and of the African countries, that we should co-ordinate our endeavours as far as possible to guard against subversion?
  The Prime Minister: Yes, I agree entirely with what my hon. Friend says. My right hon. Friend the Secretary of State for Commonwealth Relations hopes to meet the Ministers of these countries quite shortly, and we shall be discussing with them all these subjects.

  COMMONWEALTH DEFENCE FORCE
  Mr. Wyattasked the Prime Minister whether he will propose to other Prime Ministers of the Commonwealth the establishment of a Commonwealth defence force to deal with emergencies in Commonwealth territories when so requested by the Commonwealth Government concerned.
  The Prime Minister: I do not think that it would be practically or politically feasible to have a single defence force representative of the whole Commonwealth to act rapidly in an emergency. But Britain already has special defence links of various kinds with all Commonwealth countries. Canada is a fellow-member with us in the North Atlantic Treaty Organisation and in the Far East a Commonwealth Strategic Reserve of land, sea and air forces from Britain, Australia and New Zealand has been constituted since 1955.
  The British Government would welcome joint defence arrangements between Commonwealth Governments in other regions of the world, and would be glad to consider participation in them where this was the wish of the Commonwealth Governments concerned.
  Mr. Wyatt: Would it not be a good idea to try to get even token representations from other Commonwealth countries

  979
  when these emergency actions have to be undertaken, so that any charge of neocolonialism will have much less validity and we might be able to establish a set of principles stating in what circumstances we intervene in the affairs of other Commonwealth countries?
  The Prime Minister: I agree with the hon. Member, but I think that this is better organised on a regional basis than in the form which he suggests, of a token Commonwealth force.
  Mr. P. Williams: Does my right hon. Friend agree that the Simonstown base agreement is of supreme importance to Commonwealth defence and that we should do nothing to prevent the South African Government from arming itself for self-defence purposes?
  The Prime Minister: That is a wider subject. The Question deals with a Commonwealth defence force.
  Mr. Grimond: Would the agreements to which the Prime Minister referred earlier, in answer to the hon. Member for Bosworth (Mr. Wyatt),—with and between various Commonwealth countries—cover the type of action taken recently, which is internal action in a particular Commonwealth country?
  The Prime Minister: This is a situation with which we have not been faced before in the Commonwealth. The arrangements which we have with other Commonwealth countries by and large deal with external aggression.

  SALMON POACHING
  Mr. Wyattasked the Prime Minister if he is satisfied with the co-ordination that exists between the Scottish Department and the Ministry of Agriculture, Fisheries and Food on the measures necessary to curb salmon poaching; and if he will make a statement.
  The Prime Minister: Measures to curb salmon poaching are primarily a matter for the river boards in England and the district boards in Scotland to administer under the terms of the relevant statutes with the assistance of the police where necessary. I am satisfied that there is full co-ordination between the Departments when the need arises.
  Mr. Wyatt: Does not the Prime Minister remember that when he was last in this House, while the Foreign Secretary was modernising the Tory Party, he was making 36 vigorous interventions demanding increased penalties for salmon poachers in Scotland, and he was so successful that now the penalties for salmon poachers in Scotland are much more severe than in England? As it is a subject which he really understands and about which he feels very strongly, does not he think that he ought to redress the balance as between England and Scotland?
  The Prime Minister: I am certainly willing to consider this sympathetically, as the closer English legislation gets to the Scottish model the better I am pleased.
  Mr. Emrys Hughes: Is the Prime Minister aware that the one subject on which we regard him as an authority is salmon fishing? Is he aware that the last time he was in the House he wanted landlords to have the opportunity to arrest poachers themselves?
  The Prime Minister: Whenever I answer a Question I am successful in getting a rise out of the hon. Gentleman.

BILLS PRESENTED

  INCOME TAX MANAGEMENT
  Bill to amend the law relating to General Commissioners for the purposes of the income tax and their clerks and officers of Inland Revenue; to transfer from the General or other Commissioners to officers of Inland Revenue the powers of assessing income tax and related functions; to transfer from the Commissioners of Inland Revenue to inspectors of taxes the powers of assessing the profits tax; to make further provision as respects the jurisdiction of Special Commissioners and General Commissioners in appeals and other proceedings relating to income tax and the profits tax; to make further provision as respects such proceedings in Northern Ireland; to make further provision for the recovery of income tax or the profits tax charged by an assessment before the determination of an appeal against the assessment and in other cases; and to re-enact with consequential and minor amendments

  981
  provisions of the Income Tax Acts concerning returns of income and the procedure on claims for relief from tax, and to make other minor amendments in the administrative provisions of those Acts, of the enactments relating to the profits tax and of other enactments relating to inland revenue, presented by the Chancellor of the Exchequer; supported by Mr. Brooke, Mr. Noble, the Attorney-General, and Mr. Alan Green; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 72.]

  WAR DAMAGE
  Bill to make provision for expediting the completion of payments under the War Damage Act 1943, the War Damage (Public Utility Undertaking, &c.) Act 1949 and the War Damage (Clearance Payments) Act 1960; to dissolve the War Damage Commission and transfer to the Commissioners of Inland Revenue, or, in the case of payments under section 71 of the said Act of 1943, to the Minister of Transport or the Secretary of State, the functions of the War Damage Commission and any functions which remain to be performed under those Acts by the Board of Trade; and for purposes connected with the matters aforesaid, presented by the Chancellor of the Exchequer; supported by Mr. Brooke, Mr. Heath, Mr. Ernest Marples, Mr. Noble, and Mr. Alan Green; read the First time; to be read a Second time Tomorrow and to be printed. [Bill 73.]

EVICTIONS FROM RENTED DWELLINGS
3.32 p.m.
Mr. B. T. Parkin: I beg to move,
That leave be given to bring in a Bill to compel a landlord to obtain an order of the court before proceeding to evict a tenant; to provide that the court shall suspend the operation of such an order until satisfied that alternative accommodation is available; and for purposes connected therewith.
I hope that my proposed Bill will achieve three things. First, that it will put an end to what is now generally recognised as a barbaric and out-dated custom, that of putting out on to the pavement people who have been evicted from their homes, a practice which ought to disappear from any civilised country. Secondly, that it will bring immense relief and encouragement to practising solicitors who often find themselves in a very embarrassing situation with regard to their clients when they are facing the sort of tragic situation which has been all too common in recent years. Thirdly, that it will bring some sense and meaning into the figures for homelessness.
At present, such figures are no more than totals of people who have been put into the street; they were not born there. They have been evicted and put out. We would like, surely, to see the implementation of what was the original intention in preparing statistics of homelessness, to be able to make assessments of the number of problem families and not of problem landlords, and cut the flooding of welfare authorities with families with no internal problems and who ought not to be in overcrowded circumstances, and properly provide for the rehabilitation of families with internal troubles.
The Bill would abolish the uncertain and disagreeable aspects of the use by private bailiffs of the particular kind of trickery which has to be used to do violence on a home but not on a person in order to secure the possession of a dwelling and to lock it against those who have dwelt therein. I do not think that any reputable landlord, solicitor or any other person would not be glad to see that disappear. It would make the eviction of a tenant dependent on the order of a court and provide, further,

983
that the order should not be operative until the court was satisfied that alternative accommodation was available.
As I see it, that would mean that the registrar of the court had made previous inquiries from all the parties concerned, including welfare authorities, and was able to report to the judge at what date alternative accommodation which could be occupied and paid for by a family would be available, or, in extreme cases of problem families, the provision by the welfare authorities of suitable accommodation. The order would be suspended until such accommodation became available.
I am well aware that were the House willing to give permission for it to be brought in, the Bill would have to be short and clearly understood, and have practical effect within the present state of the law. By limiting it to this point I hope that I shall get agreement from all quarters. For those who have doubts, perhaps I may just go over what I think would happen if, after inquiries of the parties concerned, a registrar came to the conclusion that the case was a recalcitrant and difficult one.
It might be a case where, because a family were bad tenants, or had fallen behind with the rent, or because there was a broken home in some respect or other, the landlord—whether a local authority housing management committee or a private landlord—would be entitled to be relieved of the duty of being a welfare officer as well; and the family would be properly put in the care of an organisation which, after all, was set up by Parliament to do that, in the case of families needing retraining in making the money go round, in learning to cook and to pay debts regularly, and so on. Such families are, of course, a very small proportion of those who become homeless at present. But it is a type which the provisions of the Bill would have to cover and which a judge would have to consider when considering the report of the registrar.
If I may give examples of the sort of thing which is still happening in my constituency and the way in which the Bill would work my argument will be complete. In areas such as I represent we have a continuous problem of evic-984
tions threats of eviction and homelessness. Firms spring up which, by a coincidence, happen to be dealing with properties which were notorious in the last few years. A firm called General Freeholds Ltd. seems to manage a large number of these addresses on behalf of Wamsgain Property Company Ltd. At present, the firm works within the law and if it were able to work within the framework of the law as strengthened by the provisions in my proposed Bill the tenants would not be afraid of eviction, a fear which overshadows any reasonable negotiations.
The most complicated situation in part of Paddington exists over an estate which was sold by the Church Commissioners, sold by Lintang and then sold by auction, where there are leases of different durations still in existence, and where elderly people are being offered sums of money to surrender their leases or new leases for longer terms. It is a subject of immense complexity, needing expert advice. It is not right that they should be afraid of negotiating on equal terms because of the fear of eviction.
That is the least important example. Then I have the very moving example of a family of a man, his wife and five children living in a basement and paying a not unreasonable rent by modern controlled standards. The house was sold over their heads to an investment company, which promptly gave them notice to get them out so as to sell with vacant possession. The mother was a pleasant soul, doing her best to cope with the circumstances of herself and five children and with a sick husband in hospital. An attempt was made to serve a writ on the man while he lay in a hospital bed. That could have been terrible in its effect on the family.
This case caused me and the solicitor a good deal of anxiety. The solicitor wrote to me one day and said, "I find that the senior partner in the firm which has been acting on behalf of the landlords is a Mr. X, a Conservative M.P. Do you know him?" I know him and I think that his opinion of me is lower than my opinion of him. I shall not name him for the moment. [HON. MEMBERS: "Why not?"] I shall make that clear, and perhaps the hon. Members

985
will be surprised. I thought that I must write to him and I did so, setting out very briefly indeed the facts of the case. The following morning as I came to the House to go to a Standing Committee, he was waiting for me. He had been on to the junior partner, as this was a case which he knew nothing about.
This is the sort of thing which normally goes through the managing clerk's department. The writ was served by a writ-serving agency, which would never have been instructed to go to a hospital if any responsible person had been in charge of the operation. The investment company had bought this house by accident, as it were. It was buying an estate which contained one compact block of property and this one extra house of which it said, "Clear out the uncontrolled Tenants and sell".
That is why I do not name the hon. Member concerned. I would normally name him, but I do not think that the secretary of the Law Society would favour a commercial "plug" of that kind in a speech on a Ten Minutes Rule Bill. The rapid action to mitigate the circumstances was entirely commendable. This kind of thing ought not to happen simply because hon. Members meet one another here, or because someone knows someone else in another firm. It ought not to happen at all. The managing clerk should say to the client who gives the instruction, "This will take some time,
986
because we shall have to make arrangements with the registrar at the county court before we serve any writs".
I have told the story at length because I do not think that one should come to the House with a Bill every time that one detects a wicked man doing wicked business. Through the chain of events one cannot put one's finger on a single villainous action by anyone, but the facts would be just as tragic as if the whole thing were intentional, thoughtless and brutal. That is why I hope that my Bill, short, clear and acceptable as I believe it is to public opinion and to the whole legal profession, will also be acceptable to the House.
Question put and agreed to.
Bill ordered to be brought in by Mr. Parkin, Mr. Silkin, Mr. A. Evans, Mr. J. Silverman, Mr. Pavitt, Mr. Frank Allaun, and Mr. Carmichael.

EVICTIONS FROM RENTED DWELLINGS
  EVICTIONS FROM RENTED DWELLINGS
  Bill to compel a landlord to obtain an order of the court before proceeding to evict a tenant; to provide that the court shall suspend the operation of such an order until satisfied that alternative accommodation is available; and for purposes connected therewith, presented accordingly and read the First time; to be read a Second time upon Friday, 28th February, and to be printed. [Bill 74.]
ORDERS OF THE DAY

  CONSOLIDATED FUND BILL
  Considered in Committee; reported without Amendment.
  Motion made, and Question proposed, That the Bill be now read the Third time.
  3.45 p.m.
  Mr. William Yates: For a few moments this afternoon I wish to speak on the Third Reading of the Bill and, in particular, to make reference to the sum of £40 million part of which, as one can find in Votes 3 and 6, is to be used for the Federation Army in South-West Arabia and also for internal security and special measures under Class III (6) for internal security in Aden.
  I realise that this day is to be devoted to the Opposition's business, but I should not like a sum of this nature to be passed unless I had, first, an undertaking from the Minister about the spending of this money in South-West Arabia and some enlightenment about it. The Parliamentary Secretary knows that part of the money might be used in detention centres and also in looking after the prison services.
  A year ago I and other hon. Members spoke to him about the condition of Aden Prison. Before I agree to allowing the Bill to pass I want an assurance from him. He and the Colonial Secretary know that in that prison, built about 1809, in one compound, there are lunatics, prisoners, women and also boys, who are treated as if they were pack hounds.
  In the central part of the prison one can find women barred up. This is the most terrible gaol, for which this country is responsible. I would like to have an undertaking from my hon. Friend that at least the lunatics will be taken away from where the prisoners are. There is no room for women prisoners in the gaol. I ask what authority was given to use the chapel to house a woman prisoner. Was it because there was no room in the prison for women, or because the women's part of the prison was so terrible that she could not be sent there? These are such serious matters that I must ask the Minister
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  for an assurance before I agree to the passing of the Bill.
  I spoke to my hon. Friend privately about it a year or more ago. He knows that this prison is a standing disgrace. It is all very well for the Opposition to say that it was more of a credit in their time, but this prison in Aden condemns our name and in the last century it would have brought mortification to our country. I am not surprised that the United Nations authorities were not asked to visit the area of Aden.
  The Minister promised a year ago that a special place would be built for the lunatics so that they would not run around throwing filth among all the other prisoners. I ask him to review the case of every prisoner and of every person detained in Aden against whom no charge is made, wherever he may be detained, and where Government money is used to detain him which comes out of these funds. I must ask him, in the name of human decency, that this matter of Aden Prison be put right. Until he says so I shall endeavour to obstruct the Bill as long as I can.
  Sir Peter Agnew: Would my hon. Friend make this clear to the House? Is he suggesting that the detainees—those detained after the recent bomb outrage—are confined in the civil prison of which he has just spoken?
  Mr. Yates: May I point out, first, that those who are waiting to be repatriated or sent back to another country are confined there, and, secondly, that the lady detainee, Miss Radia Anasallah, was imprisoned in the chapel and that because we were visiting there she was moved into the hospital. The other detainees are detained outside, but wherever people are detained without trial somebody in this House must stand up and ask that they be tried or a case brought. The hon. Member did not visit the gaol during his visit, but if he was satisfied with it perhaps he would tell the House?
  3.53 p.m.
  The Under Secretary of State for Commonwealth Relations and for the Colonies (Mr. Nigel Fisher): Subject to your Ruling, Mr. Speaker, I am advised that the scope of this debate does not properly permit me to answer the matter

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  raised by my hon. Friend the Member for The Wrekin (Mr. W. Yates) in detail. I am sorry to detain the House at all when I know that hon. Members wish to get on with the main business of the day.
  Of course, I respond to my hon. Friend's invitation to look again at the conditions in Aden Prison. I think that in the present context they are not entirely relevant because the detainees under the state of emergency have not been detained in the prison, which is admittedly somewhat overcrowded and old-fashioned. That is why they were moved elsewhere. This prison is shortly to be replaced, so my hon. Friend's points are a little academic, but I shall certainly look into them with great care and particularly at the case of the Lady in the chapel, which I have heard about for the first time this afternoon.
  Question put and agreed to.
  Bill accordingly read the Third time and passed.

  POST OFFICE (HOUSEHOLD DELIVERY SERVICE)
  3.55 p.m.
  Mr. George Brown: I beg to move,
  That this House, registering its disapproval of any debasing of the public services and institutions by allowing them to be used for the dissemination of political propaganda and other highly contentious matter, calls upon Her Majesty's Government to ensure that the Post Office, in any new distribution service, shall follow the standards already observed in these matters by British Railways, the British Broadcasting Corporation and the Independent Television Authority.
  This matter has had a variety of treatment in the House and outside, but it seems to some of us to be a very important issue that we ought to treat with some care. I think that the difference between the view of some of us about this turns on one issue: whether the undertaking by the Post Office of the business of door-to-door distribution of open circulars is merely an extension of the postal service or something of a totally different order.
  Those who take the view that the Post Office is engaging in a different branch of its ordinary business will, presumably, feel that there is not a lot to argue about. I do not see it in that way. It seems to me that the difference between dealing with Her Majesty's mail in the ordinary
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  way—receiving packets, letters, postcards—is a totally different undertaking, different in degree and different in time, from distributing widespread door-to-door open circulars of the kind that we know are being offered to the Post Office.
  Nor do I feel that what might be done under this service is in any way to be compared, as the Liberal Party seems to compare it in its Amendment, with the ordinary political material that might be distributed by the Post Office in the ordinary way—the sort of free distribution that all parties get at General Election time or the sending of anything in its appropriate envelope with the full postage paid on it.
  I do not think that there is any comparison between the two. The only comparison is that both involve the use of a letter box. Beyond that it does not seem to me that there is any comparison.
  It is because the distribution of Her Majesty's mail is a special and responsible operation, involving questions of security and responsibility, that the postman is regarded as a civil servant of responsibility security-wise, and he must be worthwhile. He has a status as a civil servant and his political activities have always been carefully regulated. In addition, like firemen and policemen, his terms of employment are different from those which are normally accepted by or imposed on ordinary workers in the State. None of these issues would apply to the door-to-door distributors of an open circular, because they do not need that kind of dignity, responsibility, skill, security or limitation on the freedom of a person. It is from that basis that we start to examine what is involved in the Postmaster-General's proposal, but something else arises from it.
  We do not think that it follows that something that can go through the ordinary process of the distribution of Her Majesty's mail can necessarily be distributed by the Post Office by means of this door-to-door service that it now seeks to render. Postal matter delivered by the ordinary means may infringe some regulations, but that does not show itself openly to those handling it or to those who see them handling it. It is, for the most part, enveloped stuff. That means that the offensiveness of material that may or may not get past the Postmaster-General's regulations when

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  posted in the ordinary way is neither so apparent, because of that, nor so offensive, as it would be if distributed openly and unaddressed from door to door. Things that it would be perfectly proper to send through the mail become improper when distributed indiscriminately in this way.
  People have said during the debate outside that has gone on that this is not so. The Postmaster-General himself once said that one cannot discriminate between users of the mail, but the right hon. Gentleman himself has knocked that argument on the head. He proposes—as he has to, as a responsible and sensible man—to discriminate in the service as he does not discriminate in regard to the ordinary mail—
  The Postmaster-General (Mr. Reginald Bevins)indicated dissent.
  Mr. Brown: The Postmaster-General shakes his head, but we have on record what he said last week.
  I am rather shocked if he does not intend to discriminate. When the scheme was launched it was made clear that postal packets that are obscene, indecent, or grossly offensive, or which advocate racial discrimination, are to be prohibited. The Postmaster-General said that he was arranging for that prohibition by issuing instructions to head postmasters, making it
  "… perfectly clear that we shall not accept for this service items which will give offence to the public at large"—
  let the House note the words—
  "and we cite specifically circulars advocating racial discrimination."—[OFFICIAL REPORT, 29th January, 1964; Vol. 688, c. 368.]
  The leaflet, Household Delivery Service, that the Post Office has issued to would be users of this service does not use those words at all.
  We read in page 8:
  "The Post Office can accept for delivery only those items which are eligible for transmission by inland post."
  That appears to include all items except those detailed in paragraphs (a), (b) and (c) of Section 11(1) of the Post Office Act, 1953. The House will probably not wish me to read through all of those items, but nowhere in that Section is racial discrimination mentioned.
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  In fact, I understand that the Postmaster-General has instructed local postmasters to exercise their judgment about what is to be regarded as too offensive to be distributed by this service in a sense that will enable them to exclude anything inciting to racial hatred. Those instructions do not exist in regard to ordinary inland mail. They are not contained in the Post Office Act, under which the Postmaster-General is operating. They are not issued in Supplement No. 5, issued in January of this year, to the Post Office Guide.
  The Postmaster-General has, therefore, not accepted that anything that can go through the inland mail can necessarily go through this service. He has accepted that one has to be very much more careful with this open distribution service, and must lay down much tighter limits to what may be carried. That makes nonsense of the Amendment that the right hon. Gentleman is presumably shortly to move, which refers to respecting
  "… the same principle of freedom of communications in the household delivery service …"
  The right hon. Gentleman proposes nothing of the sort. I welcome the fact that he is issuing much tougher instructions, and is especially drawing to the attention of postmasters his wish that they should regard circulars advocating racial discrimination as being excluded. It may be that he has instructed them to exclude something else; I believe that he intends to exclude another form of literature which he does not think should be issued. If that is so, I applaud him, but, in so doing, he is accepting that there is a difference between this service and the ordinary inland mail.
  It therefore seems to us that the discussion is not, as it has been put in some newspapers, whether in this distribution service our mails shall be free from censorship. It is clearly being censored. The issue is: what shall be censored, and by whom? The right hon. Gentleman proposes to make the local postmasters responsible for a very wide measure of censorship. He is giving them considerable discretion as to what they shall shut out and, presumably, anything that they regard as being offensive to the public at large will be shut out.

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  The only narrow argument the right hon. Gentleman has had with us is whether or not leaflets advocating political policies should be regarded as offensive to the public at large. It appears that he is giving the postmasters enough discretion to leave out many other things, but he is digging in his heels against ruling that political leaflets can be regarded as offensive.
  Lots of things are offensive to the public at large—it is not only racial hatred that needs to be picked out for that dubious honour. I have just been reminded that in a large part of the county of the Quorn, anti-bloodsport leaflets might be found offensive. In an area in which Roman Catholics live in numbers, many of them would find family planning leaflets generally offensive. A whole range of things could be regarded as generally offensive.
  If postmasters are to have this wide discretion, we must have it clearly from the Postmaster-General that they have it, and can use it, as widely as that. But then I must point out that leaflets that attack the principle of public service and distributed by public servants are highly offensive to many of those public servants, and to a large number of other people. There is no reason for saying that no one can be offended by a political leaflet attacking things in which he believes, and many people may be offended by literature attacking things in which they believe.
  Since the Postmaster-General has accepted that there must be discrimination and censorship, it would be far better to write into the regulations that this House sees—not merely into the private regulations that the right hon. Gentleman issues to his postmasters—what is to be regarded as censorable and inadmissible, and we want political propaganda to be included. Our Motion is, therefore, directed to arranging that the Government shall set out in regulations approved by the House what the limits are on the new service; and shall be instructed to include a ban on the distribution through this service of political literature.
  I will come in a moment to the merits of our case in that connection, but, first, I want to look at the background, since, in a way, it may be part of the
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  Postmaster-General's answer to our case that doing what we propose will so limit the service that it will not achieve what he wants, which is to find new money and a new field of operations for the Post Office. Part of the background to our case is that to do what the Postmaster-General wants would inevitably debase the standards that have so far operated in Her Majesty's Post Office.
  The major Post Office case for this to be done at all is, "We require the additional money. Here is a service that private agencies presently perform, and which earns money for them. By that token, it could earn money for the Post Office, and we should be willing to go in and get that money." How far is this true? The question was examined by the Economist a few weeks ago. No doubt, hon. Members will have seen what was said. In the year 1962–63, the Post Office, had a profit of about £12 million on its telecommunications side, a deficit on minor services such as registered letters, printed papers, and samples of £1½ million, and a profit on letters alone of £9 million.
  I understand that the estimated deficit overall for this year is about £4 million. But the estimated earnings from this new service are about £300,000. As the Economist says in its comment, the service has obviously been very cautiously costed to show a slight margin, but to show a slight margin just at the time when such experience as we can gain from what has happened in other countries shows that this is not at all a very profitable service. In fact, most other countries which have operated it have found it an increasingly unprofitable service.
  One thing we do not know is how much literature which now goes through the post in the ordinary way will be attracted to the new, cheaper form of service. Obviously, the Postmaster-General cannot make a greater profit out of performing at a lower rate a service which he is already performing at a higher rate. It was interesting to hear him say last week that there cannot be anything against doing at a lower rate something which one is already doing. It all depends. There is a lot to be said against doing it at a lower

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  rate, (a) if the market will stand the existing rate, and (b) if one will not make very much out of doing it anyway.
  On his own figures regarding printed papers and samples, it looks very much as though this would be exactly the kind of material likely to be attracted to the cheaper service, and he is losing money on it now. On the financial side, therefore, even if the right hon. Gentleman were right, the maximum which he could claim would be that he could turn a £4 million loss into a £3,700,000 loss. If it turned out that he had not made enough allowance for the traffic moving from one service to the other, he might not even make that marginal difference to his total loss, although, in aiming to make this highly speculative and marginal difference, he would be undertaking a whole range of risks, to which I shall refer in a few minutes.
  The right hon. Gentleman's statement last week contained a collection of half-truths. There was the half-truth of his reference to our late colleague Mr. Will Williams, which gave such a distorted impression of what Mr. Williams actually said as to amount almost to a non-truth. One of the other half-truths was his reference to other countries. He left the House with the impression that there were several other countries which had experimented with and were running the service. He did not tell us that there was a tremendous outcry in America about the effect of "junk" mail—to use the American name—on the ordinary services and a good deal of satisfaction about what was happening, that the Swiss, who had operated this service, had gone back on their decision and given it up, and that the Germans, who also had the service, had found it so unprofitable that they had given it up. All that would have been relevant to what the right hon. Gentleman said about what other countries were doing.
  Mr. Bevins: I must tell the hon. Gentleman that at no time in its history has the United States operated this system and that in Switzerland the system is still operated in most parts of the country.
  Mr. Brown: My information about Switzerland is that it is being given up. We can check it during the course of
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  the afternoon. What I said about Germany is certainly true. While it is true that not exactly this system is operated in America, there is a system of delivering what is known as "junk" mail at very low rates, and there is a tremendous campaign to get rid of it because of the depressing effect it has on the ordinary services rendered by the postal department.
  This brings me to my next point. The House ought to know more than it knows already about what the effect of operating the service, for its highly disputable marginal return, will be upon the ordinary service of the Post Office. We have had no evidence yet from the Postmaster-General of the examination which he says has been made. Already, public opinion of the services rendered by his Department is not as high as it used to be, and there is a great deal of anxiety in the country lest, by taking on this extra work, even though he proposes to have it done in the afternoons, he will, because of its very size and extent, interfere with the delivery of ordinary mail the next morning or at other times. Undoubtedly, we must know a great deal more about it before we can think of accepting what the right hon. Gentleman has proposed.
  My own view as a layman, for what it is worth, is that we cannot expect the Post Office to undertake this new service, if it grows to any size at all, without forcing a clash with the normal services which the Department ought to render. It is bound to reduce to some extent revenue from the ordinary postal services. It is certain to lead to greater friction within the Post Office between the Postmaster-General and the postal staffs.
  It is important briefly to examine this last point. It is not sufficient to say that postmen cannot expect to censor what they deliver and then imagine that that finishes any examination of the postman's case. I accept that postmen cannot expect to be the arbiters of the things which they are asked to deliver. I accept that and I urge it upon the postmen. But, leaving aside the point I made just now about the Postmaster-General himself putting the duty of censorship on some postmen, the local head postmasters or their deputies, there is a much deeper issue.

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  Postmen, as I said earlier, are civil servants. One of the consequences of that status is they accept obligations which other workers do not. One of these obligations is a liability to work overtime when the exigencies of the service require them to do so. Can one imagine what will happen if men are ordered to work overtime not to distribute the ordinary mail, not to do their normal work for the service, but to go out delivering from door to door leaflets to which they object? What they might be expected to do, uncomplaining, in the ordinary hours of duty is one thing. It seems to me that one cannot expect to order men to do this sort of thing in overtime without, at the same time, expecting that there may be friction in consequence.
  There is bound to be difficulty. Inevitably, there will be awkward cases. Almost certainly, there will be men who will say, "I am not going to be ordered to do this. I do not believe that my obligation to accept compulsory overtime applies to this." Then, no doubt, postmasters will try to get out of the difficulty by giving the new service precedence over the ordinary mail delivery service, keeping the overtime for something which it is easier, they think, to instruct men to do during overtime. There will be a combination of industrial friction in the Post Office and interference with the normal services people expect from the Department.
  I now have the result of inquiries which we have made into the situation in Switzerland. We do not know whether there are any cantons operating it, but the Swiss dropped it as a federal service in 1962.
  Mr. Bevins indicated dissent.
  Mr. Brown: The right hon. Gentleman can refer to it again in his speech and tell us which cantons he relies on for his statement. There is, therefore, more to this than the question of whether the postman should be the arbiter of what he delivers. There is the fact that a service which has accepted obligations for a particular reason will now, apparently, rely on those compulsory obligations to try to get this totally different service carried out.
  I am told that relations in the Post Office between the staff and the Postmaster-General
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  are already a good deal lower in the régime of the right hon. Gentleman than they have been for a long time. Had I been a senior Minister who had been asked to consider the request from the Postmaster-General to introduce such a service as this, I would have been bound to oppose it on all general grounds, including that of his own relations with his staff.
  Of course, we must not resist change where change is suggested. I have heard arguments—and, no doubt, they will be used by the Minister—that the fact that one resists change suggests that one is reactionary. This sounds to me very much like a parallel in politics to the argument about the numerality in the Church, where modern divines seem almost unwilling to agree on the existence of God in case they are accused of being too traditionalist. All our traditions have to go to show that we are "with it".
  I do not accept this approach. I am all for change where change can be shown to be good and where it can be shown to be not merely destructive of our standards. But the change in question seems to me to be offensive, because it does not have all that good to be claimed for it, and it will certainly destroy—"debase" is the word that we use—markedly the traditional standards that have applied in this service. It will make a vast departure from the view that the Government were taking until quite recently in the matter of these standards.
  When the question of what came to be known as the "sticky label" issue arose in 1958, the then Prime Minister, the right hon. Member for Bromley (Mr. H. Macmillan), is recorded in HANSARD of 12th November of that year as commenting in these terms. He set out to show that nothing seriously had gone wrong. He said that an official had given a list of names to a body which wanted to distribute political propaganda. He told us that that official had acted unwisely, that he had been indiscreet and that he had been formally reprimanded for doing that.
  The right hon. Gentleman went on to say, however, that
  "… no one in the public service made any official facilities available with the conscious purpose of assisting the distribution of this

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  pamphlet."—[OFFICIAL REPORT, 12th November, 1958; Vol. 595, c. 400.]
  The right hon. Gentleman argued that the public service had not made available any facilities for the distribution of a contentious political leaflet and that, therefore, it was not as serious a matter as we had made out.
  Now, however, under the new Prime Minister, the Postmaster-General says, "We will now make all the public service facilities available for distributing any contentious political leaflets. We will give you the household list which we have compiled. Give us the contentious literature and we will distribute it for you." That is a total reversal of the principle that the former Prime Minister laid down only five years ago. By their own standards, the Government are clearly debasing—I would say destroying—what only such a short while ago they obviously thought was an important issue.
  I now come to the merits of our widened exclusions, as they would be if our Motion were carried. Any hon. Members on the Government side, or on this side of the House, who feel, contrary to my feelings, that, nevertheless, there is a case for this new distribution service, may still have their new distribution service even if our Motion is carried. I feel that there is a strong case against the new service for the reasons which I have given. If, however, people want to try it out, if the Postmaster-General wants to do so, if it is felt that there is money to be earned, we have not on a doctrinaire objection or deeply-held conscientious objection stopped the idea of this new service. We have merely tried to establish the limits within which it should work.
  I hope that what I say about those limits will, therefore, be acceptable to those who disagree with me on the main issue as well as to those who might agree with me on that issue. We are trying to say that there should be a restriction not only on the things that the Postmaster-General has mentioned, but on other highly contentious matter and, in particular, on political propaganda. It is inevitable that everybody gets his attention stuck on the political issue, because that has been the first contentious issue to arise and it is proper that we should
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  concentrate a lot of attention on the political issue.
  The deliberate employment of public servants, uniformed for clearer identification, openly to disseminate political propaganda is a novelty upon which the country should not embark without a great deal of consideration. It is totally novel in our constitutional practice. It is quite contrary to anything that we have ever done and I believe that it would have been rejected by any Government other than the present one. Even the present Government would be well advised to consider whether they ought to disregard the age-old tradition that we do not employ public servants in that way.
  Let it not be imagined, however, that political propaganda is the only issue involved. All kinds of other highly contentious and controversial matter might be distributed under this service unless the Postmaster-General turns every head-postmaster into a wide-ranging censoring official. The Post Office—the public service—will find itself inevitably involved in great issues of controversy.
  I have mentioned the possibility of birth control or family planning leaflets. A uniformed public servant being paid by the State to put into somebody's letter box or hand a leaflet on birth control or family planning would be a controversial issue in a Roman Catholic household. If that is done by a woman or a man employed for the purpose as a street canvasser, it is an issue between the recipient and that person. The moment that it is done by a uniformed public servant, it involves the State, as the employer of that public servant, in the controversy about which somebody feels strongly.
  Sir Kenneth Thompson: The right hon. Gentleman knows that this is done now, every day, on practically every one of the subjects which he is talking about, except that in today's circumstances there is an address on the front of the envelope. Nevertheless, a State-paid and uniformed public servant does precisely what the right hon. Gentleman says.
  Mr. Brown: I disagree; I dealt with that at the beginning. There is no similarity between delivering it in an envelope in the ordinary way of the mail

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  and delivering it openly through one's letter box. There is all the difference in the world. If the hon. Member does not agree, that is a difference between us. I should feel totally differently about getting a leaflet of that degree of controversy in an envelope sent to me and finding a postman coming up and handing it to me or to a member of my family openly as a piece of controversial literature. There is a great deal of difference between the two things.
  Mr. Arthur Tiley: For many years, it has been common practice of the Post Office to deliver postcards, which all can read, on all sorts of topics, addressed merely to the occupier of the house.
  Mr. Brown: Drawing the line is extremely difficult concerning the ordinary mail, but that is no reason for taking the line away altogether and throwing in everything.
  It is one thing for the Postmaster-General to say that he finds it difficult even to control things now. It is quite another thing to say that he will literally invite everybody to give him all their controversial literature and that he will go out of his way to deliver the lot without any cover or protection. That seems to me to be a total non sequitur as an argument and I do not follow its point at all.
  There may be all sorts of things other than pamphlets about birth control. If Fanny Hill wins her appeal, and is held not to be obscene, leaflets can be handed out by uniformed postmen advocating that we buy the book, with some nice little passages from it telling us that it would be good for us to have it. This may be a highly controversial issue even if the court decides that the book is not obscene. Do we think that uniformed public servants should be placed in the position of having to deliver these things?
  The fact that a private firm can do it, or does it, is no reason for saying that therefore the State should do it. We have to observe some different standards. I repeat that there is no way of preventing this happening unless the Postmaster-General is prepared to tell his head postmasters that they are free to so use and interpret the words "offensive to the public" as to cover anything they find offensive.
  Mr. Norman Dodds: Is my right hon. Friend aware that last week, in my constituency, a letter was addressed to a Miss E. W. So-and-So, who is only 15 years of age, which contained a statement offering her tablets and contraceptives to prevent her having children? The argument and controversy is against the firm which sent it, but if the postman had put it through the door under this scheme the trades council and everybody would have been against the Post Office for having knowingly put it through the letter box.
  Mr. Brown: I know that a case has arisen and that this can happen in the form of an ordinary letter. I do not like that at all, but I regard that as being in one category. I regard an invitation to send for these things by means of an official of the State openly distributing the literature to be in a different category and a much worse crime altogether. We should put a limit to what can happen, provided the money is available and the leaflet or material can get by the local head postmaster's definition of what is racial, obscene and generally offensive. I am not prepared to allow that to be the position. I am not prepared to allow the local head postmaster to have this wide discretion.
  It is inevitable that the postman will be embarrassed and offended. Do not let us take too lightly this offending or embarrassing of the postman. As we know, he is a man of considerable dignity and status. We do not gain much from forcing him into an embarrassing position unless there are reasons of high State policy for it. The postman is not the only one involved. Citizens will be embarrassed and offended, too, and the public service will inevitably be involved in a growing area of controversy from which, so far, it has been kept.
  On the political side, I admit quite frankly, unless an hon. Member opposite disputes it, that for the most part it will be friends of the Conservative Party who will use this organisation. [HON. MEMBERS: "Why?"] Because they have more money. Others can use it, and no doubt will, but because in normal times there is greater freedom about the sort of money that can be spent on purposes which are agreeable

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  and convenient to the Conservative Party than there is about the money available for the things which we on this side find agreeable, this arrangement will be used more by friends of the party opposite than by my party.
  My objection, however, is not based mainly on that, and I trust that the case made by hon. Members opposite is also not based mainly on it, but even if that were not so there are tremendous objections to this proposal. The Postmaster-General has said that already some of this happens and that we have political franking and slogans on the backs of envelopes. This is true. I do not know what the balance of the arguments was when it was agreed to allow that to happen, but the fact that it exists is not necessarily a case for employing public officials to distribute political propaganda widespread.
  This new practice is quite clearly an involvement of the public official in political controversy. The moment he goes round from door to door distributing the leaflets he is involved in the argument. In the past, Britain has always leaned backwards—some say too far backwards—to keep the Civil Service of all grades above any suspicion of being politically involved in this way. I do not find it easy to see where the line can ever again be drawn once civil servants are not only allowed to distribute these things, but are required to do so as part of their duty. I do not see what other barriers could ever be erected.
  Those hon. Members who represent county constituencies know the situation in small village communities. The Government official whom the villagers regularly see is quite an important personage. He is to them an important contact with the State machine, and to place him in a position in which in a village he is involved in this proposal is at the very mildest an embarrassing situation and at the worst is seeking to get some degree of influence into the political issue.
  This is one of the reasons why, even though there are other agencies which will do this work cheaper, organisations which support the Conservative Party have switched so quickly to the Post Office. They believe that if the postman
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  brings the material, that little extra cachet of authority will be brought with it. This is what they believe they are getting. Whether they are getting it or not is a matter of judgment. This is why they want these things distributed by the uniformed postman rather than by a ununiformed casually recruited canvasser. A large part of my time every polling day is taken up in villages in my constituency in trying to prevent petty authority doing what it can to influence democracy in those areas.
  This is clearly the reason why the Postmaster-General has decided that the service must stop when the General Election is announced. The postman, from then on, will not distribute any more political literature. The argument is that the election is then on and that the postman will be involved, but does anyone seriously maintain that an election campaign starts only three weeks before polling day? Does anyone seriously maintain that it is not on now? The only thing that the Postmaster-General is doing is to arrange that the service can continue during that period when there is no control over expenditure, and, therefore, friends of his party have the money and can spend it, and stopping the service as soon as there is control over the expenditure and all parties become equal.
  We become equal, or achieve a measure of equality, only at the point at which the expenditure can be charged up against each of us as candidates. At that point, the service is stopped. Meantime, it is allowed to go on. The Postmaster-General recognises that from that point on the postmen will be involved as much as they will be in the last three weeks before the General Election.
  We contend that this is not a suitable service for the Post Office to undertake. Door-to-door distribution is not suitable for the public service. We contend that this proposal will certainly interfere with the normal duties of the Post Office and will tend to disrupt them. It will almost certainly cause trouble internally in the Post Office. It will almost certainly involve the Post Office in public controversy, and it will still not make any significant contribution to the financial problems of the Post Office.

  1005
  We are giving away a very great deal, destroying some very dearly held traditions and taking some very great risks for a financial return which, even on the Postmaster-General's own figures, is highly marginal and which may turn out not to be anything like as good as that. For all these reasons, it would be better not to go on with the service.
  However, if the Government are determined to run this service from now almost to the General Election, however long or short that period may be, we suggest that the restrictions which we propose in our Motion are the very minimum compatible with our traditions and with the maintenance not only of actual political impartiality by the public service, but of the appearance of impartiality and the removal of any ground for suspicion. Just because it is the Government's friends who will use this service more widely, it is more incumbent on this Government than it would be on any other to be susceptible to the arguments which I have used.
  Unless the Government are willing to write in the protections which we propose, they must not only be open to the suspicion that they are introducing this service for party advantage, or for what they hope will be party advantage, but also accept that this will be set alongside the Prime Minister's declaration a short time ago that from then on everything which the party opposite did would be conditioned by one thing only, namely, the forthcoming General Election.
  4.43 p.m.
  The Postmaster-General (Mr. Reginald Bevins): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
  "approves the intention of Her Majesty's Government to respect the same principle of freedom of communications in the household delivery service as applies to the postal services generally".
  I do not intend to make a long speech because, frankly, I do not think that it is necessary. After all, this is only a half-day debate and I know that several hon. Members hope to catch your eye, Mr. Deputy-Speaker, or that of Mr. Speaker.
  The right hon. Member for Belper (Mr. G. Brown) deployed his arguments with his customary vigour and I shall try to answer all those which he put forward and perhaps significantly, some
  1006
  which he did not put forward. One thing which I should like to take up straight a way—and I do this in the greatest good humour—is the right hon. Gentleman's reference to a novel which, I believe, is known as "Fanny Hill". I do not know whether he has read that novel. I have not done so yet, despite its alleged literary graces, but I know that there were considerable extracts from this piece of alleged literature in almost every Sunday newspaper in our homes last Sunday.
  Mr. G. Brown: Not in the ones that I read.
  Mr. Bevins: When right hon. and hon. Members opposite refer to the standards observed by British Railways, I ask them to consider which nationalised industry in this country transported about 15 million of those Sunday newspapers from London to the provinces and Scotland.
  Before I come to the main questions which the right hon. Member for Belper raised and which are in the minds of his hon. Friends, I think that the House is entitled to know a little about the background to this service. The right hon. Member asked me a number of questions about it. As we all know, for some years advertisers—and I use that word in its widest sense, to include retailers, contractors, societies, private businesses and public businesses—have been using agencies outside the Post Office to deliver circulars and handbills to householders on a fairly large and increasing scale. Their services being cheaper than our 2½d. printed paper rate, the Post Office has lost a lot of business in consequence.
  To regain that lost business, we needed, as the Liberal Party's Amendment sensibly indicates, a new and cheaper service. This is what the new scheme provides. It makes for cheapness at both ends of the transaction—at one end by taking matter from the sender without there being an address on the envelope, or, perhaps, without an envelope at all, and at the other end, the Post Office end, by dispensing with the need for sorting at the post office.
  I think that the House would like to know that this service was launched only after the study of similar services in a number of overseas countries. We came to the conclusion, I believe rightly, that

  1007
  this would be a useful service which would improve Post Office finances at a time when they are sluggish. Since the cost of postal services must be paid for at the end of the day, by the public, we felt that this service, which, I believe, will be profitable, would help both the public and our postal staffs.
  Our initial estimate for the first financial year is that our profit may amount to about £300,000. That, set against the background of total postal revenue, is relatively small. But I say to the right hon. Member for Belper that any Minister who has a responsibility for an industry, whether it be nationalised or whatever it is, has a responsibility to the public to do the best he can with that industry from a financial point of view.
  Mr. G. Brown: There are other standards, too.
  Mr. Bevins: Any notion that this service will be used mainly for political matter is, of course, quite unfounded. In the main, it will be used for commercial purposes, but it will also be used to publicise services which have essential social purposes.
  For example, the Post Office has already had leaflets advertising mass radiography in various parts of the country. I have no doubt that this service will be used to promote and publicise such things as the blood donor service, road safety and other worthy causes. The idea which has been put about that most mothers and housewives object to unaddressed matter is, I believe, quite erroneous. The advertising profession knows better. It knows that most of our womenfolk welcome communications of any kind, especially when they are delivered by the friendly postmen.
  The right hon. Gentleman and, last Wednesday, the hon. Member for Huddersfield, West (Mr. Wade), expressed fears that the start of the service might cause some worsening in our postal services and, of course, this is a serious argument which the House will want to take seriously. I assure the House at once that the introduction of the service will not lead to a deterioration of our general postal services, but right hon. and hon. Members may like
  1008
  to know what part it will take in postal deliveries and how, in practice, it will fit in with them.
  The present position is that we deliver about 10,000 million items a year through the postal services, and my advisers reckon that in its first year the new service will deliver about 150 million items, which represents an addition of about 1½ per cent. to our present total of deliveries. Nobody can argue that that is a substantial addition during the first year. The new service will not be allowed to interfere with our present postal services. After all, the most important delivery of the day is the first one and this is everywhere timed to start and to end at a fixed time. I want to give the House a clear assurance that in no circumstances shall we extend this delivery time to accommodate unaddressed packets and that only when the traffic is light, as it is very often during the early part of the week, will we send out the leaflets with the early morning delivery and then no more than can be delivered within the normal time. The rest we will send out on the second delivery, which is usually much lighter than the first and consists, in the main, of second-class mail. If this delivery happens to be overloaded, then we shall arrange special deliveries.
  These leaflets will require very little processing in the sorting offices and, of course, hardly any transport between post offices, so that the system for getting mail from one part of the country to another will not be obstructed to any particular extent by the new service.
  I have made it clear beyond any possibility of doubt to the trade union involved that I am ready at any time to discuss with it how to make this service, both financially and otherwise, more acceptable to some of its members. That offer was sincerely made and still stands. So much for the service itself.
  Mrs. E. M. Braddock: A postman will have to walk round a large area carrying these leaflets. What arrangements are being made to transfer them to a place near to his delivery area? Does not the right hon. Gentleman realise that carrying round these deliveries in all sorts of weather, coupled with the fact that they

  1009
  will have to go to every house, will add a very great burden to the ordinary postmen?
  Mr. Bevins: I take the point, but I do not think that what the hon. Lady says follows as a matter of course. A good deal of this unaddressed material will, by its nature, be lighter than much of the heavy printed matter which now goes through the mails. In any case, the present weight limitation on the postman's bag, which, I believe, is 35 lbs., will still apply. There will be no increase in the weight load.
  Dr. Alan Glyn: What negotiations has my right hon. Friend had with the union and what has been its attitude?
  Mr. Bevins: I am coming to that.
  In April last year the National Executive of the Union of Post Office Workers recommended this scheme to its membership at a conference. The Executive could hardly, therefore, have thought it to be debasing—to use the expression of the right hon. Member for Belper. But the conference threw it out by a majority vote and it was then my responsibility to decide whether to abandon the service altogether or to go ahead. After an interval, I decided to introduce the service last month, by which time the attitude of the National Executive of the Union was not one of hostility, but of neutrality.
  The Opposition have now chosen to make a political issue out of this matter. The right hon. Gentleman the Leader of the Opposition first raised it with the Prime Minister on 23rd January, when I understand, he complained about the Aims of Industry leaflet. He alleged that it was of a party political nature and made rude remarks about him.
  I have seen millions of political leaflets in my time and I must say that I have never seen anything quite as mild and inoffensive as this one. Of course it is political, but its tone is much milder than what issues nowadays both from the Conservative Central Office and Transport House. I should be surprised if the Leader of the Opposition was so thin skinned as to believe that this was offensive towards him.
  Moreover, the leaflet does not refer to the Post Office or to any of the other
  1010
  nationalised industries, like coal and electricity. If the party opposite, or the Fabian Society, or "Keep Left", or any other organisation wants to use the service to publicise the case for nationalisation then my hon. Friend and I will be only too delighted to accept because, of course, it will improve the financial position of the Post Office, whatever its side effects might happen to be politically.
  This having been made a political issue, the House must decide it and, if it rejects the Motion—I believe that it will on the demerits of the Motion—then the service will continue. The Motion is, rather curiously, confined to the narrow question of the acceptance and delivery of political propaganda and other highly contentious matter through the post, more specifically through this new service. On page 61 of the Post Office Guide there is a list of articles prohibited from the post. They include.
  "Indecent or obscene communications … and packets be Bring grossly offensive, indecent or obscene words, marks or designs."
  There is not, and there never has been in this country, any prohibition against political matter as such. I cannot emphasise that too strongly. Subject to the limitations within the Post Office Guide we are all free, in this House and outside it, to communicate with each other or with the whole nation about any subject, whether it be political or not, about anybody or not, through the ordinary postal service. Right hon. and hon. Members know perfectly well that communications of political content are delivered by first and second-class mail all the time.
  Indeed, the two central offices are among the best customers of the G.P.O., and, as I said last week, the Labour Party itself is not prevented from putting political slogans on its envelopes. "Let's go with Labour and we'll get things done" is a perfectly acceptable slogan, partly, of course, because it does not say where we go with Labour, or what things will be done. Similarly, when the next General Election is being fought, no hon. Member, or any candidate, will be prevented from referring to himself or to his party on the envelope which includes his election address. There is no rule against printing exhortations on envelopes containing election addresses.

  1011
  It so happens that we on this side of the House believe in freedom to communicate, and it would be utterly preposterous for any hon. Member to argue that the Post Office should not handle political matter at all. I know that the right hon. Gentleman did not argue that. We ought to encourage and not thwart the clash of conflicting opinions in what is the old-fashioned belief that most of our people will then come to the correct conclusion, as I am told they did at the last three elections.
  If this practice is right in the case of the existing service, why should it be wrong in the case of this new service, and if so, for what reason? I am still waiting for an answer to that question.
  Mr. G. Brown rose—
  Mr. Bevins: I am coming to what the right hon. Gentleman said, but I do not regard that as an answer to my question.
  Mr. Brown: I am asking the right hon. Gentleman why, as he does not include in his existing regulations a ban on accepting leaflets dealing with racial discrimination, he is including that prohibition in the new service?
  Mr. Bevins: I hope that the right hon. Gentleman will not mind my making my speech in my own way. I am not going to funk any question. I have no need to. This is too easy. If it is right in the case of existing services, why should it be wrong in the case of this new service, and if so, for what reason? I want to take this question seriously, as I am sure the House does. The Motion is a bit "cagey" about this, because it gives no reason at all. The right hon. Gentleman gave one and I shall deal with the considerations that he put before the House.
  The first question with which I want to deal is this matter of the experience and practice in overseas countries, in respect of which I am sorry to say the right hon. Gentleman rather implied that I was lacking in good faith towards the House. This system operates in Belgium which, at the moment, has a Coalition Government which includes members of the Belgian Socialist Party, and they do not restrict political matter at all. In Switzerland, which is also governed by
  1012
  a Coalition Government, including Left wingers, there is no prohibition on political matter from any bona fide political organisation.
  It is true that in certain areas and cities of Switzerland, where there is an acute labour shortage, it has been necessary for the Administration to hive some of this traffic off to private agencies, but to the best of my knowledge the Administration itself is still in control of this service. Switzerland also has special arrangements for the delivery of leaflets during General Election campaigns, and, as the House knows, we are not going that far.
  In West Germany, in the Netherlands, and in Austria political matter is accepted provided that it is not anti-constitutional. In Canada, there is no restriction at all. In Denmark, the service is widely used at election times, and there is no restriction of any kind against political material. Finally, in New Zealand, the only restriction is that political matter must not over-step the bounds of ordinary propriety, and there the service is widely used by all political parthes, as I hope it will be here. Whatever the reservations may be abroad—and the House will have seen that they are trivial—to the best of my knowledge not one country in the world bars political matter through unaddressed services of this sort.
  Let us suppose, for the sake of argument that all those nine countries are misguided, that I am misguided, that the Government are misguided, that my hon. Friends are misguided—
  Mr. G. Brown: That is self-evident.
  Mr. Bevins:—and that only the right hon. Gentleman and some of his friends—I suspect that it is only some of them—happen to be right. They say that we ought to prohibit political matter, but nobody has ventured to explain—and I do not think that anybody will in the course of this debate—how one prohibits political matter, and how one decides to define political matter. The right hon. Gentleman did not attempt to do so. He went further and said that they would prohibit not only political material but matter of a highly contentious nature.
  I did not want to raise this, because I thought that the right hon. Gentleman would not do so, and I did not want to

  1013
  rub it in too hard. If we lay down that we are to prohibit matter of a highly contentious character, we are taking censorship—
  Mr. Brown: The right hon. Gentleman is doing it now.
  Mr. Bevins:—much further than mere political censorship, and the right hon. Gentleman is asking the Post Office administration, not me, at various levels to consider whether notices or advertisements in respect of beer, or smoking, or gambling are contentious. That is taking the matter to absurd lengths.
  The right hon. Gentleman made one serious point which deserves a serious answer. He suggested that the Post Office was already well on the road to censorship of the mails. That is wholly untrue. All that has happened is that in the Post Office Guide certain prohibitions have been laid down. Unlike ordinary mail, this is unaddressed mail and it may be open. All that the Post Office has done is to say that stuff that is grossly offensive shall be banned. The new service may deliver stuff that is open, and perhaps not even in an envelope. That is why the instructions say that matter relating to racial discrimination should not be allowed through this service.
  Mr. Brown: That is censorship.
  Mr. Bevins: It is not. It is being done in accordance with the Post Office rules, namely, that the matter is grossly offensive. That does not involve any change whatever in Post Office policy.
  Mr. Brown: Is any other extension or interpretation of the words being given to the head postmaster, apart from racial discrimination? Has he been told to rule out anything else on the ground of it being offensive?
  Mr. Bevins: I said last Wednesday that we had spelt out also material which would be unsuitable for children. I think that that is right, but I would not regard that as censorship in the ordinary sense of the word. In one breath the right hon. Gentleman urges me to do something, and when I take the course he urges on me he attacks me for having taken it.
  Mr. Brown: That is making it too easy. What I said was that the right
  1014
  hon. Gentleman was objecting to our Motion on the ground that it would involve his officers in exercising censorship. He says that he is exercising censorship over anything connected with racial discrimination, or which is offensive to children. I am pointing out that that is censorship, and the right hon. Gentleman has given away the whole case that we are urging on him.
  Mr. Bevins: If the right hon. Gentleman will be good enough to read what I have said—and I have chosen my words very carefully in the last five minutes—he will see that there has been no departure from existing Post Office practices in this matter.
  Mr. William Ross: The right hon. Gentleman will appreciate that this discrimination will have to be exercised by at least 2,000 postmasters throughout the country. Will he give those postmasters freedom to accept or reject whatever they deem to be offensive?
  Mr. Bevins: I am sure that the hon. Member appreciates that the discretion and right to decide whether matter is grossly offensive is a responsibility which lies at the various rungs of responsibility in the Post Office at present, and is exercised by responsible servants of the Post Office every day of the week.
  I come, finally, to the terms of the Motion. Significantly, it does not argue that this service should be thrown overboard. All it asks is that the Post Office should follow the standards observed by British Railways, the B.B.C. and the I.T.A. The view of the right hon. Gentleman and some of his hon. Friends is that this would be right, because the Post Office, like the other three bodies, is a public body. It so happens, however, that the functions of the four bodies are totally different.
  The function of the railways is to carry freight and passengers and the B.B.C. and the I.T.A. are broadcasters. The Post Office is neither of these things—thank heaven—but within the context that all four bodies are public bodies their advertising practices are very much the same, in the sense that all four prohibit certain advertising within their own houses—railways at their stations, the B.B.C. in the Radio Times, and the Post Office in telephone directories and kiosks.

  1015
  But this is not what we are debating. The House is not debating advertising on railway stations or in telephone kiosks; it is debating the question of freedom of communications, which is quite a different matter—
  Mr. Ross: It is not.
  Mr. Bevins:—from advertisements on other people's property.
  I have been trying to think of a closer parallel, and I think that a more appropriate one is not the hoardings of British Railways but the attitude of British Railways to the carrying of political propaganda. British Railways carries masses of it, in just the same way as does the G.P.O. In Liverpool, at the weekend, a friend of mine who is a political agent told me that he receives several thousands of leaflets from the Conservative Central Office. They are picked up by British Railways from a political organisation and delivered to a political organisation. There is nothing wrong with that, and what is right for one service is right for another.
  I end on this note: if I were to prohibit political matter from household delivery, how could I refuse to apply the same principle to the mails in general? It just could not be done on any sensible basis.
  My right hon. Friend the Chief Secretary to the Treasury hopes to wind up this short debate, but I now repeat that my only interests in this matter are the interests of the public and of those who work for the Post Office. I am satisfied that this service will help both, and, subject to the one or two minor prohibitions which I have already mentioned, and which I am fairly sure are generally acceptable to the House, I am not—nor are the Government—willing to interfere with the principle of freedom of communications.
  5.15 p.m.
  Mr. Charles Morris: It is probably true to say that not since the time of Postmaster-General Herbert Samuel and the Liberal Administration of 1911 has there been such a disputatious atmosphere in the Post Office as that which exists at present. If anybody needs any corroboration of that he can go into the Central
  1016
  Lobby or into the Committee Rooms upstairs, where Post Office workers are assembled to make their views known on the whole subject of the Household Delivery Service.
  Having said that, I should make it abundantly clear that all reasonable people—all people who genuinely have the good will and future of the British Post Office at heart—would accept the obligation of the Post Office to examine new and different services and to consider the question of areas where the Post Office might expand its services to the community. The reason why I identify myself with the Motion is that I believe that the whole introduction of the service has been mishandled.
  In the interchange of questions which we heard in the House last week some of the views which were expressed were symptomatic of a somewhat strange attitude for any Postmaster-General to adopt on behalf of his Department. He said that there were two justifications for the Household Delivery Service—one, expansion and the other, profitability. He went on to make the charge that the idea of expansion had been prompted by the late Member for Openshaw—Mr. W. R. Williams. The right hon. Gentleman went on to say that the leader of the Union of Post Office Workers—Mr. Ron Smith—had also identified himself with this service.
  On that occasion the House showed its contempt for the introduction of the name of a former Member, and the manner in which the Postmaster-General used it. But no matter how contemptuous it is to bring the name of a deceased Member into a debate in the House in order to buttress one's own argument, the point made by the Postmaster-General was that both Mr. W. R. Williams and the U.P.W. were in favour of this service. He said that they recommended the service to a conference of the U.P.W.
  He was right in that, but to leave the matter on that basis was very unfortunate. If he is criticising the general secretary of the U.P.W. and also the views expressed in this House by the former Member for Openshaw, he might well criticise my views, because I was a member of the executive council of the U.P.W. at the time, and shared the corporate responsibility of that body for

  1017
  the recommendation which was put to the annual congress.
  Why did the union executive change its mind?—because that is what the right hon. Gentleman implied. It went to the annual conference of the U.P.W. and put the recommendation to the conference. It was considered by the conference. Is the right hon. Gentleman suggesting that the executive body of the Union of Post Office Workers should bulldoze its opinions through its annual and special conferences? Is he suggesting that the general secretary of that union ought to go to the members of the union and say, "This opinion should over-ride your opinion"? Of course not. We claim that the structure of our union is as democratic as any in the country. It is a serious matter that these charges should be made and I hope that on future occasions the Postmaster-General will not do so.
  There is another important factor. When the executive council of the union assembled after the annual conference decision—a decision made by the elected representatives of the nation's postmen—and when that decision was considered, one important fact was borne in mind which the Postmaster-General has tended to overlook. Against a background of the expressed hostility of postmen, were we to engender a situation in which industrial action would have been a possibility and bearing in mind that, through the action of the Postmaster-General 18 months previously, revenue amounting to £1 million was lost?
  The right hon. Gentleman talks about profitability. But 18 months before he involved the Post Office in a loss of revenue amounting to £1 million over his handling of the work-to-rule and pay negotiations. If the right hon. Gentleman says that he is interested in profitability and that £300,000 is all-important I welcome his departure from his previous point of view.
  All along he has said that there are two justifications for this scheme—expansion and profitability. Why not take the same attitude regarding the giro system of Post Office cheques? Why did he resist that suggestion from the staff associations within the Post Office? That was an avenue of expansion. But because the right hon. Gentleman
  1018
  meekly yielded to pressure from the joint stock banks this country is without a giro system of Post Office cheques, and the banks are introducing transfer credits.
  This was from the same individual who talks about expansion and profitability. He says that we ought to have a household delivery service because it would bring in £300,000 additional finance to the Post Office. But I ask, "Will it?"
  Let us examine some of the facts. He says that there is an area covered by private agencies which cater for correspondence and leaflets, within the definition of a household delivery service, to the extent of 600 million items, and he suggests that the Post Office ought to give attention to this. Even though the right hon. Gentleman succeeded in introducing his household delivery service, it would create a situation in the Post Office which would be like having Christmas every week. I say, with respect, that the right hon. Gentleman has not the physical characteristics to be a Santa Claus. Nor are there at present the resources within the Post Office which would be necessary to carry on the additional work.
  The most important consideration which ought to occupy the minds of hon. Members is that raised by the right hon. Member for Orkney and Shetland (Mr. Grimond). Last week he asked whether the introduction of the service would have a deleterious effect on first-class and second-class correspondence deliveries. The Postmaster-General quickly said that that had been considered before the scheme was suggested, and the Postmaster-General was certain that first-class correspondence would take precedence over household delivery correspondence. I wonder whether the right hon. Gentleman will be able to substantiate that view if the service is introduced.
  When will the household delivery service correspondence be delivered? It is said that it will be delivered partly by means of the night mail deliveries and during the day mail deliveries. Is the right hon. Gentleman saying that postmen engaged on night mail deliveries are not fully occupied? Is he quite sure that the day mail deliveries could absorb this additional correspondence?

  1019
  These are questions which he will have to answer, if not now, in the future.
  He talked about the use of the mails in other countries for this type of correspondence, in Switzerland and the United States of America. Only last year, through the courtesy of the English-Speaking Union I had the privilege of visiting the United States for three months to study Post Office administration there. I went to most of the major centres and I found that, whether in New York, Washington, Boston, Pittsburgh, Detroit, Chicago, San Francisco or New Orleans, the same attitude was apparent with regard to this type of correspondence.
  Mr. Bevins: The hon. Gentleman must not say that. I have already said, and I am sure that the hon. Gentleman will not contradict me, that there is no such service of this kind in the United States.
  Mr. Morris: I do not wish to contradict the Postmaster-General. I will grant him that courtesy. I shall leave it to his own leaflet to contradict him.
  The Postmaster-General has said that there is no household delivery service in the United States and, technically, he is right. But let us look at the definition of household delivery in the Departmental circular dealing with household delivery service. The definitions within the service indicate the same type of correspondence as that carried at a low preferential rate within the Federal Post Office service in the United States. I gather now that the right hon. Gentleman accepts my point.
  Mr. Bevins: Oh, no. The hon. Gentleman must not jump to that conclusion. If he has been to the United States and seen the working of the postal service there, he will realise that one reason why the postal service in the United States is perhaps not as good as the U.S. Administration thinks it ought to be, is that it carries a very large quantity of what we call second-class mail at a very cheap rate. May I say to the hon. Gentleman, for about the third time, that here we are dealing with unaddressed, and very often unenveloped, mail.
  Mr. Ross: We have started down the slippery path.
  Mr. Morris: I will catalogue the type of correspondence which the right hon. Gentleman is now suggesting that the British Post Office should deal with. It is in the leaflet. It does not need defining. The Post Office leaflet says:
  "Leaflets, circulars, shopping guides, sales letters, sample packets, etc."
  The right hon. Gentleman has defined it, not I. Those are precisely the classifications of correspondence which in the post offices of the United States are defined, in colloquial expression, as "junk" The right hon. Gentleman is suggesting that the British Post Office should take on "junk".
  I was very impressed by a letter which appeared in the Guardian yesterday about this classification of correspondence. I accept the Postmaster-General's opinion that we have a much more efficient Post Office service than there is in the United States. The reason why the service in the United States is inefficient is that the volume of this type of mail which the right hon. Gentleman suggests he should take on is crippling normal Post Office services in that country.
  I do not want to advance only my own views about the United States service. I advance the views of the writer to the Guardian yesterday. He said:
  "As an American in Britain for a few months, I must express the horror I feel at the thought of another country being deluged with the delivery of unaddressed mail. For the past few years this delivery has brought into American homes tooth paste, detergent, shaving lotion, perfume and literally baskets of unwanted printed matter. We have long ago ceased to enjoy more than one delivery of mail a day and perhaps we may not have even that soon, and at an increasing cost."
  That is precisely the position we shall be in if we accept these proposals of the Postmaster-General.
  The letter went on to say:
  "So loud is the din of unsought and unread circulars that the next step contemplated by those who hope to penetrate the numbed brains of the public will surely be advertising over the telephone. Those who say the mail service will be degraded by this burden are, I think, right. Many Americans would welcome, and are urging, an end to this unnecessary irritation."
  If one wanted justification for the arguments we are putting forward this is one which I hope this House will accept.

  1021
  I have instanced the views which the postmen of the country have expressed in the Central Lobby and in Committee rooms of this House this afternoon. People ask, "Why are the postmen concerned about the introduction of this service?'' Having worked with so many of them for so long, I know that they have a pride of craft in the service. It probably has a psychological background. When one is wearing the Queen's uniform and going about with crowns on one's lapels one does not want to be reduced to the status of a pamphlet pedlar. Yet the Postmaster-General and his department put out advertisements in which they say, "Give your mailing system the prestige of Post Office delivery". In effect we are to sell at five guineas a thousand the prestige of Post Office delivery in rural areas. Does this House accept that reasoning?
  I hope that the Postmaster-General will think again, not only of the political implications but about the wider questions of the household delivery service as such. He said in his contribution today that he had indicated to the Executive Council of the Union of Post Office Workers that he is prepared to have further discussions with them. I ask, is he prepared to withdraw this household delivery service so that those discussions can proceed on a completely impartial and neutral footing?
  I say in all honesty that it does him no good to interpret the statesmanlike attitude of the executive council of the Union of Post Office Workers as mere neutrality. If these people are to be attacked in that fashion because they adopted a statesmanlike attitude when they met you the other day—The Postmaster-General is looking puzzled. Let me tell him what I am getting at. During your introduction—
  Mr. Deputy Speaker (Sir William Anstruther-Gray): I am sorry to interrupt the hon. Member, who has not been here for very long, but he should address the Chair.
  Mr. Morris: May I apologise most sincerely? Will you put it down to my complete ignorance of the customs of this House, Mr. Deputy Speaker?
  I wish to deal with the point made by the Postmaster-General this afternoon. In the course of his contribution
  1022
  he referred to the meeting he had with the executive council of the Union of Post Office Workers. He said, referring to the time before the conference, "When I met them in deputation they adopted a policy of neutrality". I say that that is a complete misrepresentation.
  Mr. Bevins: This is becoming tiresome. I never said anything of the sort. [HON. MEMBERS: "It is on the record."] It will be on the record. I did not refer to the deputation. I said that since the decision of the conference to turn down this proposal the executive had adopted an attitude of neutrality, which is true.
  Mr. Morris: That is precisely what I have said. The right hon. Gentleman can put what interpretation he likes on it. I hope hat the House will decide who is reflecting the truth of what the Postmaster-General said in his contribution to the debate.
  No matter which way the voting on this Motion goes, the decision on it will not be all-important. What is important is that within the Post Office there is an harmonious relationship between the Postmaster-General and the departmental heath and the staff whom they control and who serve the Post Office and the nation. Debates which take place here are important, but the Post Office will have to go on providing its services long after this debate is over. I indicated when I started my speech that we have had two occasions in the past two yeas when Post Office workers within the minor manipulative grades have been on the brink of the abyss of industrial action. They took industrial action in January, 1962.
  I hope that the Postmaster-General will reflect and take a more realistic view of the opinions which are being expressed to him by the able leaders who represent the nation's postmen. I hope that the House will reject the Amendment and will vote in favour of the Motion.
  5.40 p.m.
  Sir Kenneth Thompson: The House may recall that I was privileged to serve in the capacity of Assistant Postmaster-General for about three years, long enough for me to develop a deep affection for the Post

  1023
  Office and all who work in it and the greatest possible respect for all the services which it renders to the community. Nothing could be more hurtful to the Post Office in particular or to the country as a whole than that anything should be done to damage either the relationship that exists between all members of the staff of the Post Office at whatever level or the quality of the service that the Post Office gives.
  I hope that, whatever the outcome of this debate, and whatever may be said in the course of it, it will be realised that the two prizes which we seek to achieve will be, first, that the first-class mail service of the Post Office will never be damaged or imperilled, and, secondly, that nothing will be said or done that will damage the structure of the relationship that exists within the Post Office at the present time. If we approach the question of a household delivery service with those two objectives in view, then possibly we are in a position to arrive at a sensible conclusion.
  I do not believe that this is a political issue. Neither can I believe that the right hon. Member for Belper (Mr. G. Brown) really believes that the household delivery service is some wicked idea concocted by the Conservative Central Office in Smith Square in order that we shall have a better chance than we already have of winning the next election. I do not believe that to be true for a moment and I do not believe that the right hon. Member for Belper believes it to be true either.
  My right hon. Friend would be gravely remiss in the administration of the Post Office if he saw an opportunity for increasing the revenue of the Post Office and improving the services that it can render to the community and then proceeded to neglect them. Here is an undoubted service already being given in some sketchy forms over selected areas in the country. It is obviously a useful service or it could not survive commercially and obviously a profitable service by the same token, What, then, is wrong with the British Post Office taking part of this service, and as much of it as it can get on strictly competitive commercial terms, in order to add to the revenue of the Post Office? On straightforward commercial considerations I can see no real argument against it.
  1024
  I see the point of view of the postman who says that this is a commercial operation which ought to be done by girls, wearing a particular coloured overall with the name of the firm on it, delivering leaflets or samples as a special service, and that this is something different from and less than the kind of service that the uniformed State servant—the postman—proud, dignified and responsible as he is, has been accustomed to give. I see that argument. But what is in the argument? Is it really true that what the postman does today in delivering the addressed mail—collecting, transferring, sorting and then delivering—is so different from what he is now to be asked to do in the household delivery service? If it were true that the leaflets to be delivered in this service were mere frivolithes—were mere throw-away, unimportant leaflets of the nature that we seen on the street corners—there might be something in the argument.
  This is quite an expensive service. It is a service that can be used only by someone who is determined that he is prepared to pay enough to get his message delivered into the houses in which he wants to get it delivered. This is not a lighthearted enterprise that anyone who wants to get his message delivered for 12s. 6d. a dozen will engage in. This is a serious enterprise that can appeal only to some one who has something he wants to say and is prepared to make the effort to see that it is said at the very points where he wants it said. That is precisely what the postman has been doing all his life. He has been accepting a responsibility that is quite considerable and carrying it out as a uniformed, responsible, trained and very highly-skilled servant of the State. He is being asked to do the same thing with a service which is wanted by people who are prepared to pay a considerable price for it.
  Let us remember that five guineas per thousand for city or urban delivery is only one part of the cost that falls on the man who wants his message delivered. He has to have the message printed and to employ, since he is in business in a fairly big and responsible way, a designer, a draftsman, or at least a script writer to get the whole thing right. This is a highly-skilled and highly-expensive service, and it demands that

  1025
  it should be handled by somebody in a very special and highly-skilled class. For these reasons in particular, I think that it can be done by no other service than the Post Office. I hope that my right hon. Friend will stick to his guns and see that this is not only continued but lifted to a proper, responsible part of the Post Office service.
  Mr. Julian Snow: Is the hon. Member suggesting that this service should be introduced where there is already a shortage of postmen, for instance in my constituency, where there is a severe shortage of postmen and where they are working up to 25 hours a week overtime as it is? Is he suggesting that this service will not jeopardise the existing service even more?
  Sir K. Thompson: The hon. Gentleman was here when I made my two qualifications of the service. It can stand only provided that it is not allowed to impinge on the high quality of the services that we already give and that the operation of it, the day-to-day arrangements, do not cause any deterioration in the relationship that exists between the staff of the Post Office at all levels. These are conditions which must override all other qualifications of this service or of any other services concerned. This is not the only part of the Post Office service that might cause difficulties in a constituency area, such as the hon. Gentleman represents, or at certain times of the year in practically every one of our constituencies. They are nevertheless essential qualifications that must be observed by the Post Office if this service is to be accepted as part of the normal run of the services of the Post Office. I am sure that my right hon. Friend is as much aware of and as careful of these considerations as anyone who has ever had anything to do with the Post Office. I hope that he will stick to his guns in this matter and see that the service is developed to the very best of his ability.
  5.47 p.m.
  Mr. Donald Wade: A case can be made out against having any new household service at all, but it is more difficult to justify the Opposition's Motion which, in effect, proposes that the new delivery service should proceed but that the dissemina-
  1026
  tion of political propaganda and other highly contentious matter should be excluded.
  I do not look at this problem with a prejudice in favour of the increased distribution of political propaganda. I cannot envisage a situation in which the party to which I have the honour to belong would be so well endowed with funds as to outdo the other parties in the distribution of literature. I can, therefore, look at this subject somewhat objectively. In any case, it would be very difficult to define political propaganda. For example, I understand that a certain religious denomination advises its members that it is wrong to vote. I do not know whether literature issued on behalf of that denomination would be regarded as political.
  There is a more serious example. The right hon. Member for Belper (Mr. George Brown) referred to family planning. If, under the present system of second-class mail, a leaflet were to be distributed in a small wrapper showing quite clearly the words "Support family planning", that would be quite permissible. It might upset some postmen—I do not know—but I do not see how a logical distinction can be made between that leaflet and another delivered without a wrapper. The right hon. Member said that this new service was not just an extension of the postal service, but represented a difference in degree and kind. There is a difference in degree, but not in kind. There may well be a considerable increase in the amount of matter a postman will have to carry, and it is most important that postmen and postwomen should be adequately remunerated. That is why our Amendment stresses the need for a satisfactory reward for these people.
  I have here a letter from the wife of a postman. I do not normally quote from an anonymous letter, but in this case I am satisfied with the writer's reasons for not giving her name, and her letter illustrates the attitude of a number of postmen's wives. She writes:
  "I am writing in the hope that you will please press for an increase in the postman's wages. The Household Delivery Service is only one of the bitter grievances of men like my husband, who brings home less than £11 per week to feed, clothe, pay rent, rates, provide for holidays, etc.
  How can we expect to be even decently dressed or fed on £11 15s. gross for 45 hours?"

  1027
  Further on she says:
  "My husband used to be proud to serve in his job, but now he is dispirited …"
  A little later she pleads:
  "In heaven's name, please do something …"
  I am sure that most hon. Members will sympathise with the writer's point of view, but would the proposals in the Oppositon's Motion really help? I do not think that they would.
  I have one or two queries about the working of the scheme. First, how will the prohibition on certain types of literature work? That raises certain practical problems that we must face. I am not too happy about censorship by individual head postmasters. Would it not be possible to have principles clearly laid down, and approved in some way by Parliament, rather than leaving the decision to individual head postmasters?
  I do not suggest that we should cut out political material. I have already made it clear that, on principle, I cannot see how, if we have this service, we can say that political matter must be excluded. What the House ought to consider is the amount of money expended by organisations of various kinds on political propaganda prior to a General Election. The figure for maximum expenses now allowed a candidate is antiquated in comparison with the colossal amount expended in other ways. We should consider that aspect, but we cannot deal with that problem under the heading of this particular service.
  There is probably a simple answer to my next question. The Post Office rightly has a monopoly of the ordinary mail but, presumably, that will not apply to this delivery service. This point had not occurred to me until my right hon. Friend the Member for Orkney and Shetland (Mr. Grimond) received the following letter from a Mr. Caro, who writes:
  "Dear Mr. Grimond,
  With regard to the new service, shortly to be introduced by the Postmaster-General concerning the distribution of unaddressed circulars, I am of the impression that if this is allowed to go through a situation might arise which would make it illegal for private individuals to indulge in door to door leaflet distribution.
  1028
  When the Post Office is responsible for services (postal telegrams, telephone and radio, etc.) they automatically become the monopoly of the State, and legislation prevents firms or individuals from entering into competition, whether it be on a profit making basis or not. One can well see that now the Post Office intend providing an unaddressed leaflet delivery service, small tradesmen, political parties and companies in existence for this purpose might well be breaking the law.
  I would suggest that the Postmaster-General gives assurance (during tomorrow's debate)"—
  that is today:
  "that the right of individuals to indulge in their own leaflet distribution will not be threatened by the introduction of the new service by him."
  Perhaps the Government spokesman will be able to give me an answer later this evening.
  Would it be practicable for members of the public to opt out of this service? I suppose that it would be too difficult. There are members of the public who dislike receiving quantities of literature by whatever means it is delivered. Literature without any envelope or wrapping is probably the least popular and the least likely to be read, and literature in an envelope addressed to the occupier is regarded less favourably than that which bears the address of the person. The reason is probably psychological. Furthermore, some people are just fed up with the amount of literature coming through the letter box, and I have some sympathy with them. I do not know whether it would be possible to register people who wish to be non-recipients. That might be impracticable, but it could be looked into—
  Mr. Godfrey Lagden: Has it not occurred to the hon. Gentleman that if we were to take this course, in households where there were five or six people, two of them might wish to reject this service while three would be eager to accept it? That difficulty could not be readily overcome.
  Mr. Wade: That is a very interesting conundrum, but I shall not try to answer it now.
  More important is the effect of this delivery service on first- and second-class mail. The Postmaster-General last week gave me an assurance that has been repeated today. We all know that

  1029
  Christmas time is an exception. A great effort is made to get Christmas cards out before Christmas Day, and my impression is that first-class mail is held up then as a result. I often have complaints from business firms and other concerns about business mail being delayed during that period—and this may be a matter of great importance to a business man. But these people are prepared to put up with that during the 10 days to Christmas. Nevertheless, one would not wish that to happen from time to time during the year, so one must stress the importance of not delaying first-and second-class mail. Already, I frequently have complaints in Huddersfield about delays in the delivery of mail.
  I return to the point of fair remuneration. I am aware of complaints made by postmen on the score of their standing in the community—that they are civil servants, and do not wish to be regarded as of a lower standing—but I think that, in the long run, that is closely linked to remuneration. If they were well paid, I do not think that their standing in the community would be lowered merely because they were asked to help with this new kind of service. It is for that reason that our Amendment states, first,
  "… that any extra work postmen and post-women are required to do is satisfactorily rewarded",
  and, secondly,
  "… that it involves no reduction in the standard of service for fully paid mail …".
  If these conditions are satisfied, it would be reasonable that this service should be tried out.
  5.59 p.m.
  Mr. Kenneth Lewis: On the occasion when he announced that this service would be coming into operation, my right hon. Friend gave among his reasons for introducing it that he felt that it was right from a commercial point of view. Usually, when we are discussing the affairs of a nationalised industry in the House, we are not allowed to discuss commercial matters which are the day-to-day responsibility of the industry, but this, of course, does not apply to the Post Office. The Post Office is a Government Department financed by the State and the profit from it is taken by the State.
  1030
  The first question one must ask oneself, as a Member of this House, is whether the new service is likely to be a good commercial proposition. Whatever may be said in the Motion moved by the right hon. Member for Belper (Mr. G. Brown), or the Amendment moved by my right hon. Friend, political propaganda and the delivery of it are quite secondary to the question whether this kind of service will be a commercial proposition. I doubt that it will be a commercial proposition. This point has already been mentioned by hon. Members on both sides. I am doubtful about it because I am not at all certain that the kind of people to use the new service will not come from those who already use the ordinary second-class mail service.
  Also, I am a little concerned that by introducing this service my right hon. Friend may find himself involved in commercial matters which at present do not trouble him. Acting through his officers, he will have to look at mail as it goes through the service. He will have to decide what is to go through and what is not to go through. This, it seems to me, will be a form of censorship. I know that my right hon. Friend argues otherwise, but one cannot seek to ascertain what is going through the service, whether there is, for instance, pornographic literature being circulated, if one does not look at everything.
  My right hon. Friend will be involved in passing through the service all kinds of circulars, samples and the like from commercial firms. Some of the commercial firms will, no doubt, be making perfectly bona fide offers. Others may be shady; their samples and their offers may be suspect. If their material went through the ordinary mail, there would be no problem, because my right hon. Friend does not know what they are pushing through the ordinary mail, and he can deal with them through the normal processes of the law whenever he thinks that they are sending by mail something which they ought not to send. In this service, on the other hand, he will be in a difficulty. In my view, therefore, it will provide a new kind of commercial risk for the Post Office.
  Further, on the commercial side, I am not at all sure that there will be the

  1031
  kind of demand for the service, at the price which the Post Office will charge, which will make it profitable, taking into account the extra money which must be paid to postmen or the extra staff it may be necessary to take on. This is a matter of pure commercial judgment, of course, and usually in discussing these things in the context of other nationalised industries we should be ruled out of order by the Chair.
  There is another reason why I am a little concerned. I am concerned about the staff side of this operation. During the coming months, as we have been during the past year or two, we shall in this country be involved in affecting great changes in industry, with the introduction of automation, the adoption of new industrial processes and the like. Sometimes it may take months, sometimes a year or two, to get the changes on a proper footing. There is already an instance. At one of our biggest steel companies, in the Midlands, it took a long period of discussion to get moving to fruition new processes to get them fully working, because this operation involved redundancy and other changes in conditions for the workpeople.
  Whenever one is introducing a new service, not only in a nationalised industry, the Post Office or anything run by the State but in private industry as well, it is important to make absolutely sure of carrying the staff along with one. Of course, management does not have to do everything just because the staff want it. In this case, the Post Office workers must realise that it is their duty to work the service when it is introduced. But I remind my right hon. Friend of something said by the Assistant Postmaster-General on 25th March last, when the idea of this service was first mooted.
  The proposal was supported by the then hon. Member for Manchester, Openshaw, the late Mr. Will Williams. Incidentally, I take exception to some of the comments made by right hon. and hon. Members opposite about the quotation from what was said by the late Mr. Williams. He was a great friend of many hon. Members on both sides of the House. I say that to the present hon. Member for Openshaw (Mr. C. Morris). We sat under Mr. Williams' chairmanship in Committee.
  1032
  It is quite a common thing to quote the words of a Member who may, unhappily, have died. It has been done by the present Leader of the Opposition, who has at that Box quoted things said by the previous Leader of the Opposition.
  It is unfair of hon. Members opposite to suggest that my right hon. Friend should not have quoted what Mr. Williams said.
  Mr. Harry Randall rose…
  Mr. Lewis: I am sorry. I have not time to give way.
  The late Mr. Williams supported the idea of this service at the time, and he gave a list of deliveries which might be sent. At the end of that list, he said something like "and other things". He left it quite open.
  Now, on this occasion, in winding up, my hon. Friend the Assistant Postmaster-General said:
  "The household delivery of literature is being seriously studied, and we wish to take advantages of the opportunities …
  This was in reply to the late hon. Member for Openshaw.
  "naturally, we do not wish to take the final step before we have reached agreement with the staff on this matter".—[OFFICIAL REPORT, 25th March, 1963; Vol. 674, c. 1073.]
  That seemed to me to be a promise which should be fulfilled by the Postmaster-General. I have, therefore, some doubt on the staff side of the matter.
  Last, I have some doubt about whether people really want the service in its present form.
  Mr. F. Blackburn: Or in any form.
  Mr. Lewis: In a restricted form, there is scope for the Post Office here, scope to take out many leaflets, pamphlets, bills and the like from local authorities, other Government Departments and people of that sort.
  Mr. Blackburn: Making skilled men into errand boys.
  Mr. Lewis: But I think that there is something to be said against postmen being involved in carrying bagfulls of propaganda, advertising material and samples. I regard this as a job which should be done by the private companies

  1033
  which are involved in these things themselves. I believe that people generally, when they resent much "junk" and rubbish being put through their doors, put up with it when it comes from a private source because they have to, because the private sources are so numerous that they cannot get at them.
  But if we involve postmen and the Post Office in carrying too much of this advertising and publicity material, we may make the postman the focal point for resentment, and we will lose the kind of good relationship which the public has always had with the postman. Therefore, I hope that my right hon. Friend will go forward with this service but will look at it again and consider whether it can be rather more defined than he has defined it so far.
  The way it is, I cannot support the Amendment in the Lobby. [HON. MEMBERS: "Vote with us."] I would not think of voting for the Opposition's Motion, because it is nonsense. The Post Office already carries political propaganda and hon. Members opposite know this perfectly well. I could fully subscribe to the Government Amendment, but if I vote for it I should be not only doing that, but voting for the service as it is proposed, and I am not happy with the service as it is proposed. Therefore, I will abstain.
  I do not want my right hon. Friend to withdraw the service. I simply want to have discussions on it on the way in which it should be applied. I certainly do not want my right hon. Friend in any way to run away from the political argument which has been put forward by the Opposition, because, as the Post Office already carries political propaganda, there is absolutely nothing in the argument that the service has been introduced for this purpose or that it can apply with advantage to one political party as against another. The Opposition Front Bench knows this as well as I do.
  6.11 p.m.
  Mr. Roy Mason: I was sorry to hear the hon. Member for Rutland and Stamford (Mr. K. Lewis) mention again the name of my late hon. Friend the former Member for Manchester, Openshaw, Mr. Will Williams. It is my intention to place it once more on the record that on 25th March, 1963,
  1034
  referring to bills, notices, rate notices from local authorities and notices from private commercial firms and insurance firms, my hon. Friend specifically said "and all the rest". Anybody in this House who knew "Bill" Williams could never have imagined him—indeed, he would have been grievously hurt if challenged with doing so—advocating the service that the Postmaster-General has now brought forward, which introduces advertising on a large scale and political matter.
  What the Minister said about the executive of the Union of Post Office Workers was offensive. To state that it took a neutral attitude is wrong, because the U.P.W. executive, exactly the same as my late hon. Friend, advocated a household delivery service, but did not have in mind its use for political propaganda purposes.
  Mr. W. R. Rees-Davies: In his speech, will the hon. Member make plain exactly what limitations the U P.W. seeks? I understand them to include commercial advertising. Will the hon. Gentleman make plain exactly what are the precise exclusions? Are they political only, or is there anything else?
  Mr. Mason: The hon. Member, I gather, has only just come into the Chamber. I have been here since 3.30. If the hon. Member will wait and see, he will probably gather from my speech precisely what attitude we take.
  I agree with the hon. Member for Liverpool, Walton (Sir K. Thompson) and the hon. Member for Rutland and Stamford, who said that this service must be seen to pay. In spite of the speech of the Postmaster-General, I am not yet satisfied—and, as the right hon. Gentleman has not convinced me, he will not have, convinced other hon. Members—that the service is necessary, that it will be profitable, or that the right hon. Gentleman has not departed from past practices.
  The Postmaster-General hastily introduced this 'measure. It had not been properly thought out. It was announced on 6th January. It was publicly advertised in all general post offices that the service was available on 20th January. Yet following the first query—that of racial and political propaganda—the

  1035
  Postmaster-General flapped, the Post Office was puzzled and the service was suspended.
  Mr. Bevins indicated dissent.
  Mr. Mason: It is all on record. There seems to have been little consultation about the service. The Post Office Advisory Council was not consulted and never discussed it. The Postmaster-General notified the Advisory Council that he would introduce it, but he never sought the council's advice. Indeed, before introducing the service he had no knowledge of what public reaction would be. He knew very well that the postmen would react strongly against the scheme.
  That is the trouble with the right hon. Gentleman. Too often in Post Office affairs he acts like a bull in a china shop. He did the same with the introduction of subscriber trunk dialling. There was little thought beforehand of public reaction. The scheme is running months behind time. It was born in the face of public protest. There have been shoals of letters in the Press. Questions were asked in the House. The matter was raised in debate and, shortly after the introduction of S.T.D., there had to be a change in the cost of calls.
  That is the trouble with this new service. It has been born against a background of discontent in the Post Office and from the public. The few thousand pounds that the right hon. Gentleman hopes to make will be offset by a worsening of relationships between postmen and the Postmaster-General and, likewise, between the postmen and the public.
  Listening to the Postmaster-General and to the debate, I have not been satisfied that sufficient consideration has been given to the effects of the service upon postmen, upon head postmasters and upon the efficiency of the postal service. Postmen genuinely feel that they are being downgraded, that they are suffering loss of dignity, that there will be a loss of respect for them and that the public image of the Post Office will be tarnished.
  Imagine the postman's position and difficulties. Does he, or does he not, take out the leaflets with the early morning delivery? If he does, undoubtedly
  1036
  the early morning delivery will be delayed and the efficiency of the service will suffer. The Postmaster-General knows that an indication has gone out from his office to all the advisory councils suggesting that, where possible, that should be done.
  There have been shoals of complaints in the House about the inefficiency of the service, mails being delayed, late deliveries, and so on. The new service will aggravate the situation. If, on the other hand, a postmaster decides that there is too much mail to go out with the first mail and that deliveries might be retarded, he must decide upon a special service.
  The Postmaster-General never does his homework. He is too slick at the Box in trying to introduce these measures. He said that 10,000 million items a year now go out and that he expects an addition of 150 million items under this service. He blandly said that that would be an increase of 1½ per cent. He knows that the increase will not apply evenly throughout the country. Postal "pockets" will be chosen by commercial organisations and in these districts the increase will be a great deal higher than 1½ per cent. If there is to be a special service, a second delivery exclusively for leaflets, I wonder whether, as they will have to be delivered at every household delivery point, overtime may be necessary and there will be sufficient postmen in some areas to carry out the service.
  I do not want the red herring of competition to be drawn across my path. One of the reasons why the postal service is losing revenue is the loss of coupon traffic. That coupon traffic was fully paid for. The new service is a cheap, selective service, not an expensive one, at half the rate of the coupon traffic. Consequently, the coupon traffic could carry a little overtime and a special delivery because it made money. The 1¼d. rate for leaflets will not be able to do that.
  The Postmaster-General referred to the fact that advertisers are doing these deliveries and that the Post Office wanted to try to take some of the traffic because the advertisers had been taking the 2½d. traffic. Does not the right hon. Gentleman realise that those who remained loyal and faithful to the G.P.O., who continued to send their printed matter in a 2½d. envelope, will now switch to the

  1037
  leaflets and the Post Office will lose on the printed paper rate? I am not yet convinced that this service will pay.
  Samples are also allowed to be delivered by this service. Any manufacturer who wants to advertise any product can send out a 4 oz. or 2 oz. sample. The manufacturers are likely to send out 2 oz. samples, because they will not want to give too much away. There can be samples of soap, toothpaste, detergents, or drugs. This means special deliveries, because the postman has only a 35 lb. pouch and if he takes 2 oz. samples he can deliver only 280 and he may have 400 delivery points. This will necessitate his doubling back to make the extra delivery, or more postmen will have to be employed on the walk. I am satisfied that the sample service on its own will not pay.
  Another question is the size of the material to be allowed. Have hon. Members read the instructions for the service? The maximum size will be 12 in. by 4¾ in. by ¾ in. thick. Many of those cannot be accommodated in a pouch, and if there is to be a deluge of these things in an area many postmen will be required to take them out. I cannot see how that can pay.
  It is obvious to me, therefore, that this will be a subsidised service. In other words, manufacturers of detergents or soap will be guaranteed a house-to-house delivery by uniformed civil servants, and some other post office activity will have to subsidise it. The Postmaster-General estimates a profit of £300,000 this year, at a time when General Election propaganda will go out before Parliament is dissolved. It therefore should be a profitable year. It may well be that the whole service will have to be subsidised if it does not pay in the first year. As I have said, the right hon. Gentleman estimates a £300,000 per year profit in the first year's operations. What a measly sum at the expense of the postman and his status and the public ill-feeling and the G.P.O. gradually turning the letterbox into a litter bin.
  What about the head postmaster's dilemma? He will suffer most. The usual rules are easy. The matter must not be obscene, libellous, or likely to cause a breach of the peace. This is the general run of instructions to head
  1038
  postmasters. The Postmaster-General says that this case is no different. He has defeated that argument time and again in his own speech by now bringing fresh rules. He has now sent out instructions to head postmasters that no matter must go out which is offensive to young people, and no racial literature must be delivered. This is because these are open leaflets. They are not in sealed packets and there must be stronger censorship. Head postmasters now become censors. They become political censors because they have to decide what is political material and whether it can go through openly in the leaflet post. But the head postmaster has no guidance on political matter yet.
  At the moment, in the main, the only bodies wanting to use this service are the Conservative "front" organisations—Aims of Industry, Industrial Aids Limited, and possibly the Economic League. They have printed thousands of leaflets and are clamouring to use the service. It makes one believe that the right hon. Gentleman is now allowing political matter to go through solely because of that. Indeed, it makes one believe that he is allowing political matter purposely to assist the Tory trumpeters with an easy, cheap and guaranteed access to every home.
  The right hon. Gentleman certainly did not have this in mind when he introduced the service. It was not in the documents which he sent out, in the Press hand-outs or in the regulations on the household delivery service. There was no comment in any of these about political matter. It is only since the service has been advertised that the right hon. Gentleman has sent out fresh instructions on racial literature and matter which is offensive to young people.
  As for the Aims of Industry leaflets, the anti-nationalisation propaganda will probably go to steel-producing areas. These Conservative "front" organisations may have had difficulty in any case in finding a sufficient number of sympathetic distributors. In any event, the propaganda would not have been efficiently distributed. What better than that a Government Department should be used with uniformed postmen as their agents?

  1039
  This is where we cross swords with the right hon. Gentleman. This departure from past custom and practice is to be deplored. As has been said, British Railways and the I.T.A. go out of their way, in their rules, to cover this point. It is no use frowning and saying that there is no comparison here; there is. Uniformed postmen will take out leaflets carrying advertising and political matter, and it will be open matter just the same as if it were put on hoardings. This literature will not be sealed and the postmen will know precisely what it is. Therefore, there is an analogy here.
  British Railways are quite clear about their rules governing the acceptance of advertisements which are controlled by British Transport Advertising Limited on behalf of British Railways. They say specifically that
  "Advertisements will not be accepted for or retained on display on British Transport Advertising sites if they … might wound racial susceptibilities … attack a member or the policies of any Government … are of a political nature, whether produced by a political party or not … might foment social unrest."
  As the Postmaster-General knows, in the matter of programme content the I.T.A., under the provisions of the Television Act, 1954 makes sure that nothing is included in programmes which
  "offends against good taste or decency or is likely to encourage or incite to crime or to lead to disorder or to be offensive to public feeling or which contains any offensive representation of or reference to a living person …"
  Section 3(1.g) provides that
  "no matter designed to serve the interests of any political party is included in the programmes."
  The Second Schedule of the Act states that there must be no material which has a bearing on industrial disputes.
  I should like to draw the right hon. Gentleman's attention to two of these matters. First, there is the sentence in the British Railways rules about fomenting social unrest and then there is the I.T.A. ruling about matters which have a bearing on industrial disputes. The Post Office will be inundated with requests from minority groups who have an axe to grind, the Fascists, the Nazis and—I say this as a trade unionist—the warped-minded Martells and the racialists. The Martells already have pamphlets waiting for the Postmaster-General to say that they can
  1040
  go through the post. These antidemocratic factions may send out material which is not racialist, obscene or likely to cause a breach of the peace, but it may cause social unrest and lead to strikes. Where will the Postmaster-General draw the line and what are the rules which will govern all this? These anti-democratic factions may send out political material which is not racialist, or obscene, or likely to cause a breach of the peace, but which may foment social unrest, and, in some strike ridden areas, may worsen the relations between management and men, and, indeed, even cause a strike.
  This new service is cheap and is attractive to people, and above all it is a guaranteed delivery in chosen pockets or postal districts in any part of the country. The service, used in this way, can be dangerous, and it places our postmen in the invidious position of being political censors.
  What is the Postmaster-General going to allow? We have always been proud in this country of its political stability. We have never denied democratic rights to minorities. On the other hand, we have never encouraged factions whose sole aim is to undermine and destroy our democratic institutions. This service will be an encouragement to them. If, say, there is social unrest, how guilty will the Postmaster-General and head postmasters, and postmen, feel about it?
  I must stress to hon. Members that this is a very cheap service. Those who use it have no addressing of envelopes to do; they do not have to buy envelopes. The minority factions can choose pockets or postal districts. The Postmaster-General and head postmasters will have great difficulty in deciding whether or not the material is contrary to the blanket rules, whether it is strongly political or otherwise.
  The timing of the service could not have been worse, either. The right hon. Gentleman told us that it will stop as soon as Parliament has been dissolved, and that it will not be allowed in a by-election area when a Writ has been issued. There are five by-elections pending at the moment; most of the candidates have been chosen, and the initial sparring has begun. So it is all right then for the Aims of Industry, the

  1041
  Economic League, Industrial Aids, Ltd., Martell—any of those—to cheat the Representation of the People Act, to cheat the statement the right hon. Gentleman made, by his allowing the Conservative "front" organisations to flood the areas concerned? They can do it now. The same will apply to these factions who get by his political censors in the Greater London area; they will be able to influence the Greater London electorate as well. It also affects one-sixth of the Members of this House who will probably be active in that campaign.
  If the B.B.C. felt guilty over the political controversial content of "T.W.T W.T.W." and withdrew it on the ground that this is election year, why does the Postmaster-General allow his Department to be used in political controversy at this time? Five by-elections are pending, the Greater London Council election is pending, local elections are almost on our doorstep, and there is, indeed, a General Election expectancy in the air.
  Mr. C. Brown: Not much expectancy amongst hon. Members opposite, judging by the way they look.
  Mr. Mason: But the timing could not have been worse for another reason. The right hon. Gentleman knew that the Union of Post Office Workers' conference had turned down his scheme. He knew, also, that the postmen were against his imposition of a low wages policy on postmen and that the postmen are now mustering their forces for seeking a national revision of wages. There is great unrest in the Post Office. In the face of all this the right hon. Gentleman decides to launch a scheme which to many postmen proved to be the last straw—hence the lobbying today and the meetings upstairs, and the many Union of Post Office Workers' branches' resolutions against it.
  I recognise that the Post Office is losing about £8 million on postal activithes—although I understand that this will be reduced to about £4 million this year—and that this has been mainly caused by the loss of pools traffic, but what worries us is that the Postmaster-General forgets that the Post Office is a public service, a fact which must always be borne in mind during his bouts of commercial fanaticism. He also is pruning back the rural telephone
  1042
  kiosk service, and he is gradually stifling the telegram service. Now he is introducing the unaddressed delivery service, which could well impair his mail delivery service.
  In view of the fact that this service is generally not wanted, and that it will blur the public service image of the Post Office for little financial return, that we fear that there will be a worsening of relationships all round, and, above all, that our postmasters are to be asked to be political censors, and that this is departing from the nationally recognised convention that Government Departments and agencies should not be used for politically controversial services, we intend to ask the House to vote against the introduction of the service.
  6.35 p.m.
  The Chief Secretary to the Treasury and Paymaster-General (Mr. John Boyd-Carpenter): The concluding words of the most eloquently delivered speech of the hon. Member for Barnsley (Mr. Mason) underline the tangle in which the Opposition have got themselves on this issue.
  When my right hon. Friend answered a Question last Wednesday the attack on him, led by the hon. Gentleman the Member for Belper (Mr. G. Brown), was that he was introducing the service at all. Indeed, during the course of this debate at least two-thirds of the speech to which we have just listened, and about one-third of the right hon. Gentleman's speech, and the whole of that of the hon. Member for Manchester, Openshaw (Mr. C. Morris), were directed not to the issue actually raised by the Motion, whirl speaks of
  "any debasing of the public services … by allowing them to be used for the dissemination of political propaganda and other highly contentious matter"
  but related to an attack on the service as a whole.
  Therefore we must ask hon. Members opposite to be a little clearer than that about what it is they are asking the House to decide this evening.
  Mr. Dan Jones: Not to do it at all.
  Mr. Boyd-Carpenter: The hon. Member says, "Not to do it at all." Of course, that is precisely the opposite

  1043
  of what his right hon. Friends have put in their Motion. It is a long Motion, but there is a copy by the hon. Member—
  Mr. D. Jones: I have read it.
  Mr. Boyd-Carpenter: —in which he will see that it relates to
  "the dissemination of political propaganda and other highly contentious matter".
  Mr. G. Brown: I do not think the right hon. Gentleman is really quite as obtuse as he is making out, but let us get it quite clear. There is still time for the House, under its ordinary procedure, to decide whether or not regulations shall be made. At this stage, what we are saying, as I was very careful to say to the right hon. Gentleman, is that if, despite all the arguments we have put, the Government want to pursue it, then we will consider that in the light of whether they are prepared to amend the regulations in accordance with our Motion. That is what I said. This is the constitutional position. That, at this stage, is what the right hon. Gentleman should address himself to.
  Mr. Boyd-Carpenter: It is precisely the Motion to which I am addressing myself. The Motion says nothing whatever about stopping the inception of the service.
  Mr. William Hamilton: That can come later.
  Mr. Boyd-Carpenter: The hon. Gentleman can say that it comes later, but I am dealing with the proposal which the Opposition have seen fit to put in the Motion.
  I know why hon. and right hon. Members put it in this way. They realise that it is patently inconsistent for the Labour Party, which stresses in and out of season the need for nationalised industries to expand their scope, to come forward and attack my right hon. Friend when he proposes an additional service to the public which will improve the financial position of the Post Office. It is completely inconsistent with what the right hon. Gentleman the Leader of the Opposition said at his 1961 party conference, that nationalised industries should be set free to expand their activities.
  1044
  When my right hon. Friend the Postmaster-General, whose skill and determination in restoring and improving the finances of the Post Office are plainly serving the public interest in general and the interests of his staffs in particular, comes forward with a proposal of this sort I would not have been surprised if some of my hon. Friends had taken a little exception—indeed, I think that my hon. Friend the Member for Rutland and Stamford (Mr. K. Lewis) did—to this extension of nationalised industry's scope in competition with private enterprise in what is believed to be a remunerative field.
  But it comes ill from hon. Gentlemen opposite. I think that that is the reason why they have, in the Motion—if not in a good many of their speeches—switched from the line taken last Wednesday, and produced this portentous Motion about "debasing" the public service and "political propaganda and other highly contentious matters".
  I thought that the right hon. Gentleman made rather heavy weather about political propaganda. There is not an hon. Member who would be in this House at all had he not taken part in political propaganda. The right hon. Gentleman knows that perfectly well. In what, as I think we must all agree, was one of his less happy speeches, the right hon. Gentleman sought to make an argument—here, I must accept that he did for a short time refer to the terms of the Motion—by trying to establish that there was something so different about this service that while it was, he accepted, legitimate for political propaganda to go through the ordinary mails, it should be excluded from this service.
  On thinking that over, I believe that the right hon. Gentleman will find that there is nothing like a sufficient difference between this service and the regular mails to sustain the totally different conclusion about whether they should carry political propaganda or not. It is carried by the same organisation, the General Post Office. It is delivered by the same organisation, using the same staff. The only substantial difference is the instructions which the sender gives about delivery which are given in general terms—shall we say, "Deliver to all the houses in Barnsley"—rather than that each envelope is separately addressed.

  1045
  If it is unobjectionable for political propaganda to be delivered anywhere one likes in the country if the sender puts a 3d. stamp on an envelope and addresses it or a 2½d. stamp on a postcard and addresses it I cannot see why there is any objection—when it is being delivered by a "uniformed public servant", to quote the right hon. Gentleman—to any house in the country by means of this new service.
  The right hon. Gentleman said that the propaganda delivered by this service would be open and not in envelopes. That argument will not sustain the difference. One can send political propaganda on a postcard; indeed, I believe that a good deal of propaganda is sent in that way. With their worldly wisdom the courts of law have said that we must presume that postcards are read in transmission.
  One can go further and stamp a political slogan on an envelope going through the ordinary post. In May of this year the director of the Labour Party's publicity organisation in Smith Square asked the permission of the Post Office to put a slogan on envelopes emerging from that address stating "Let's go with Labour"—
  Hon. Members: Hear, hear.
  Mr. Boyd-Carpenter: —"and we'll get things done."
  I think that even the right hon. Gentleman would accept that that was political propaganda, and that hon. Members who cheered it did so because they thought that it was political propaganda. It is not very good political propaganda. But it is the best that hon. Gentlemen opposite can do, so we must not be too censorious. That is the most blatant political propaganda, and I must stress that it was permitted to anyone who cared to put a 3d. stamp on a letter and put that slogan on it. It was delivered by a uniformed public servant. What is the distinction between that use of political propaganda—
  Mr. G. Brown: The 3d. stamp.
  Mr. Boyd-Carpenter: The 3d. stamp—exactly. Political propaganda ceases to be political propaganda if it costs you 3d.—according to the right hon. Gentleman.
  Mr. Brown: The right hon. and learned Gentleman may be enjoying himself. But let us also be fair. The difference is that when one has to pay for it, provide an envelope, put a 3d. stamp on it and address the envelope to an individual person, it is a totally different operation from the door-to-door indiscriminate distribution, at a cheap cut rate, of unaddressed, open material.
  Mr. Boyd-Carpenter: Exactly. It is, as the right hon. Gentleman has said, a good deal cheaper.
  But what is the deduction from that? It is that political propaganda—apparently this is the view of the right hon. Gentleman—should be rationed by the purse. If one can afford an organisation to address envelopes, and the postage—as apparently Transport House can—it is all right. The right hon. Gentleman exposes the weakness of his argument when he says that he accepts that political propaganda can go in this way, but cannot go by the cheaper method which my right hon. Friend is introducing.
  The right hon. Gentleman argued that we were accepting censorship because we said that grossly offensive—to use the right hon. Gentleman's words—material should not be sent by this service. I accept that there may be marginal cases of doubt about what is grossly offensive material. It may be a matter of argument. But surely there is all the difference in the world between, for example, obscene attempts to arouse racial antagonisms, and straight obscenity, and ordinary political propaganda which would fail in its object were it anything of the sort.
  The right hon. Gentleman said that anti-nationalisation propaganda—he hastily corrected himself and said anti-public service, to show that he really meant the same—was offensive to him. The right hon. Gentleman is confusing two things what is in the real sense offensive to all decent people, and propaganda. The attitude of the right hon. Gentleman is painfully different from that of the old radical who said. "I hate what you lay, but I will fight to the death for your right to say it." That was the older and better tradition of radicalism in England—[HON. MEMBERS: "A Frenchman said that."]—and I am glad

  1047
  to see that the members of the Liberal Party, to their credit, support it in their Amendment.
  The right hon. Gentleman let a large cat out of the bag. He said that this proposal would mainly help the Conservative Party. I do not know whether he is right. He then said that opposition to it was not mainly based on that, which, I thought, a very revealing remark.
  Mr. G. Brown: There is a certain degree of opposition.
  Mr. Boyd-Carpenter: The right hon. Gentleman—it was referred to in some of the other speeches—suggested that the new service should follow the standards observed by three other public bodies. I accept that that is not an unreasonable criterion. It is true, as was said by the hon. Member for Barnsley, that British Railways accept some restrictions on advertisements displayed on railway premises. There is no suggestion that advertising of a political character will be displayed on Post Office premises, which is the exact analogy.
  But my right hon. Friend pointed out that British Railways make absolutely no political distinction in the case of freight carried. That is an exact analogy with what the Post Office proposes to carry by means of this service. Indeed, British Railways go further. They even run a special train to take right hon. and hon. Gentlemen opposite to their party conference.
  Mr. Brown: And we pay for it.
  Mr. Boyd-Carpenter: As the right hon. Gentleman says, they pay for it, as the customers of this service will pay for it—at the full rate. I have no doubt that if the Liberal Party put in a similar request British Railways would be happy to supply a minibus.
  Hon. Members: Cheap.
  Mr. Boyd-Carpenter: The B.B.C. is mentioned in the Motion. The Corporation does not exclude political propaganda from its programmes. There is no ban on political propaganda on the B.B.C. It maintains a proper balance in its programmes, both in the party political broadcasts which are organised by agreement with the main parties and
  1048
  in the discussion programmes which, I believe, it takes great trouble to secure are properly balanced. The same goes for the I.T.A.'s political programmes.
  The hon. Member for Barnsley quoted the Television Act, but he did not quote all of it. He did not quote the proviso to Section 3 under which there is provision for properly balanced political programmes. The Post Office is following that principle by providing a service which is open and available to those who do not break the rules about obscenity or offensiveness.
  The next question is: why is this restriction thought necessary in this country? My right hon. Friend the Postmaster-General has reminded the House that other countries which run services of this sort do not impose the political ban which is asked for. In New Zealand, where there is a very similar service, both political parties make very considerable use of it to the profit of the New Zealand Post Office. I must ask right hon. Members opposite why a protection from the "debasing" influence, to quote the Motion, of political propaganda which is not required for the New Zealander is required for the Briton. Why are we thought to be so unsophisticated that it is necessary to have this kind of protection?
  The right hon. Member for Belper ducked the question of political censorship. He spent a lot of time making the point that my right hon. Friend's ban on obscenity and gross offensiveness amounted to a form of censorship. That is an arguable view, but, whatever censorship it may be, it is a very much smaller and less vicious thing that political censorship. What the Motion asks the House to approve is the introduction of political censorship in the Post Office for the first time in our history.
  Hon. Members opposite are all alone in this. The Press, from The Times to the New Statesman, is against them on this. They have seen the criticisms which have been made of this venture and how the hon. Member for Barnsley referred to the problem of a head postmaster dealing with possibly obscene or offensive leaflets. I accept that there may be problems, but they are very small compared with the head postmaster's

  1049
  problem of what is, or is not, for the purpose of this rule, to be treated as political propaganda.
  For example, would an analysis of the reasons for the financial crisis at the end of the last two Labour Governments be political propaganda, or, as it could be suggested, an interesting historical analysis?
  Mr. W. Hamilton: What about an analysis of the Tory Party leadership?
  Mr. Boyd-Carpenter: The difference is that a report on the Prime Minister would be for the benefit of my right hon. Friends, whereas it is arguable whether a biography of the Leader of the Opposition would be in our interests or in the interests of hon. Members opposite.
  Take the two leaflets to which reference has been made. Is it to be said that the Post Office cannot be used to send round a leaflet about nationalisation by the new cheaper service? Take the other case, in which a former deputy chairman of the Liberal Party is apparently putting round material
  suggesting that the Conservative Party should be more conservative if it is to meet his taste. Are we to censor that kind of thing? If so, where would the censorship stop? This is the serious issue which is raised by today's debate.
  I accept at once that I do not think that right hon. and hon. Members opposite fully appreciated the seriousness of the issues which they raised when they tabled their Motion. I say this in their favour; I may be wrong. However, I am bound to say that I welcome this debate and their action, because it has lifted a veil on the arrogant intolerance with which a Labour Government would treat those who ventured to criticise them. They make it clear that they would use the authority of the State to check fair criticism of their measures. Many people have trod that dangerous path before. We reject it tonight. The country will reject it tomorrow.
  Question put, That the words proposed to be left out stand part of the Question:—
  The House divided: Ayes 237, Noes 310.

  Division No. 17.]

  AYES

  [6.58 p.m.

  Abse, Leo

  Crossman, R. H. S.

  Hamilton, William (West Fife)

  Ainsley, William

  Dalyell, Tam

  Hannan, William

  Albu, Austen

  Darling, George

  Harper, Joseph

  Allaun, Frank (Salford, E.)

  Davies, G. Elfed (Rhondda, E.)

  Hart, Mrs. Judith

  Allen, Scholefield (Crewe)

  Davies Harold (Leek)

  Hayman, F. H.

  Awbery, Stan (Bristol, Central)

  Davies, Ifor (Gower)

  Healey, Denis

  Baoon, Miss Alice

  Davies, S. O. (Merthyr)

  Henderson, Rt. Hn. Arthur (Rwly Regis)

  Baird, John

  Deer, George

  Herbison, Miss Margaret

  Barnett, Guy

  Detargy, Hugh

  Hill, J. (Midlothian)

  Baxter, William (Stirlingshire, W.)

  Diamond, John

  Hilton, A. V.

  Beaney, Alan

  Dodds, Norman

  Holman, Perey

  Bellenger, Rt. Hon. F. J.

  Doig, Peter

  Houghton, Douglas

  Bencs, Cyril

  Driberg, Tom

  Howell, Charles A. (Perry Barr)

  Benn, Anthony Wedgwood

  Duffy, A. E. P. (Colne Valley)

  Howell, Denis (Small Heath)

  Bennett, J. (Glasgow, Bridgeton)

  Ede, Rt. Hon. C.

  Howie, W. (Luton)

  Benson, Sir George

  Edelman, Maurice

  Hoy, James H.

  Blackburn, F.

  Edwards, Rt. Hon. Ness (Caerphilly)

  Hughes, Cledwyn (Anglesey)

  Blyton, William

  Edwards, Robert (Bilston)

  Hughes, Emrye (S. Ayrshire)

  Boardman, H.

  Edwards, Walter (Stepney)

  Hughes, Hector (Aberdeen, N.)

  Bottomley, Rt. Hon. A. G.

  Evans, Albert

  Hunter, A. E.

  Bowden, Rt. Hn. H. W. (Leics, S. W.)

  Femythough, E.

  Hynd, H. (Accrington)

  Boyden, James

  Finch, Harold

  Hynd, John (Attercliffe)

  Braddock, Mrs. E. M.

  Fitch, Alan

  Irvine, A. J. (Edge Hill)

  Bradley, Tom

  Fletcher, Eric

  Irving, Sydney (Dartford)

  Bray, Dr. Jeremy

  Foley, Maurice

  Janner, Sir Barnett

  Brown, Rt. Hon. George (Belper)

  Foot, Dingle (Ipswich)

  Jay, Rt. Hon. Douglas

  Brown, Thomas (Ince)

  Forman, J. C.

  Jeger, George

  Butler, Herbert (Hackney, C.)

  Fraser, Thomas (Hamilton)

  Jenkins, Roy (stechford)

  Butler, Mrs. Joyce (Wood Green)

  Galpern, Sir Myer

  Johnson, Carol (Lewisham, S.)

  Callaghan, James

  George, Lady Megan Lloyd (Crmrthn)

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

  Carmichael, Neil

  Ginsburg, David

  Jones, Dan (Burnley)

  Castle, Mrs. Barbara

  Gourlay, Harry

  Jones, Elwyn (West Ham, S.)

  Chapman, Donald

  Greenwood, Anthony

  Jones, J. Idwal (Wrexham)

  Cliffe, Michael

  Grey, Charles

  Jones, T. W. (Marioneth)

  Collick, Peroy

  Griffiths, David (Rother Valley)

  Kelley, Richard

  Corbet Mrs. Freda

  Griffiths, Rt. Hon. James (Llanelly)

  Kenyon, Clifford

  Craddock, George (Bradford, B.)

  Griffiths, W. (Exchange)

  King, Dr. Horace

  Cronin, John

  Gunter, Ray

  Lawson, George

  Crosland, Anthony

  Hale, Leslie (Oldham, W.)

  Ledger, Ron

  Lee, Frederick (Newton)

  Oswald, Thomas

  Sorensen, R. W.

  Lee, Miss Jennie (Cannock)

  Owen, Will

  Soskice, Rt. Hon. Sir Frank

  Lever, Harold (Cheetham)

  Padley, W. E.

  Spriggs, Leslie

  Lewis, Arthur (West Ham, N.)

  Peget, R. T.

  Steele, Thomas

  Lipton, Marcus

  Pannell, Charles (Leeds, W.)

  Stewart, Michael (Fulham)

  Loughlin, Charles

  Pargiter, G. A.

  Stonehouse, John

  Mabon, Dr. J. Dickson

  Parker, John

  Stones, William

  McBride, N.

  Parkin, B. T.

  Strauss, Rt. Hn. G. R. (Vauxhall)

  McCann, John

  Pavitt, Laurence

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

  MacColl, James

  Pearson, Arthur (Pontypridd)

  Swain, Thomas

  MacDermot, Niall

  Peart, Frederick

  Swingler, Stephen

  McInnes, James

  Pentland, Norman

  Symonds, J. B.

  McKay, John (Wallsend)

  Popplewell, Ernest

  Taverne, D.

  Mackie, John (Enfield, East)

  Prentice, R. E.

  Taylor, Bernard (Mansfield)

  McLeavy, Frank

  Price J. T. (Westhoughton)

  Thomas, George (Cardiff, W.)

  MacMillan, Malcolm (Western Isles)

  Probert, Arthur

  Thompson, Dr. Alan (Dunfermline)

  MacPherson, Malcolm (Stirling)

  Proctor, W. T.

  Thomson, G. M. (Dundee, E.)

  Mahon, Simon

  Pursey, Cmdr. Harry

  Tomney, Frank

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

  Rankin, John

  Wainwright, Edwin

  Manuel, Archie

  Rees, Merlyn (Leeds, S.)

  Warbey, William

  Mapp, Charles

  Reid, William

  Weitzman, David

  Marsh, Richard

  Reynolds, G. W.

  Wells, Percy (Faversham)

  Mason, Roy

  Rhodes, H.

  Wells, William (Walsall, N.)

  Mayhew, Christopher

  Roberts, Albert (Normanton)

  White, Mrs. Eirene

  Mellish, R. J.

  Roberts, Goronwy (Caernarvon)

  Whitlock, William

  Mendelson, J. J.

  Robertson, John (Paisley)

  Wigg, George

  Millan, Bruce

  Robinson, Kenneth (St. Pancras N.)

  Wilkins, W. A.

  Milne, Edward

  Rodgers, W. T. (Stocktson)

  Willey, Frederick

  Mitchison, G. R.

  Rogers, G. H. R. (Kensington, N.)

  Williams, D. J. (Neath)

  Monslow, Walter

  Ross, William

  Willis, E. G. (Edinburgh, E.)

  Moody, A. S.

  Royle, Charles (Salford, West)

  Wilson, Rt. Hon. Harold (Huyton)

  Morris, Charles (Openshaw)

  Shinwell, Rt. Hon. E.

  Winterbottom, R. E.

  Morris, John

  Silkin, John

  Woodburn, Rt. Hon. A.

  Moyle, Arthur

  Silverman, Julius (Aston)

  Woof, Robert

  Neal, Harold

  Silverman, Sydney (Nelson)

  Woof, Robert

  Neal, Harold

  Silverman, Sydney (Nelson)

  Wyatt, Woodrow

  Noel-Baker, Francis (Swindon)

  Slater, Mrs. Harriet (Stoke, N.)

  Yates, Victor (Ladywood)

  Noel-Baker, Rt. Hn. Philip (Derby, S.)

  Slater, Joseph (Sedgefield)

  Zilliacus, K.

  Oliver, G. H.

  Small, William

  O'Malley, B. K.

  Smith, Ellis (Stoke, S.)

  TELLERS FOR THE AYES:

  Oram, A. E.

  Snow, Julian

  Dr. Broughton and Mr. Redhead.

  NOES

  Agnew, Sir Peter

  Bullard, Denys

  Elliott, R. W. (Newc'tle-upon-Tyne, N.)

  Allan, Robert (Paddington, S.)

  Bullus, Wing Commander Eric

  Emery, Peter

  Allason, James

  Burden, F. A.

  Emmet, Hon. Mrs. Evelyn

  Amery, Rt. Hon. Julian

  Butcher, Sir Herbert

  Errington, Sir Eric

  Anderson, D. C.

  Campbell, Gordon (Moray & Nairn)

  Errott, Rt. Hon. F. J.

  Arbuthnot, Sir John

  Carr, Rt. Hon. Robert (Mitcham)

  Farey-Jones, F. W.

  Ashton, Sir Hubert

  Cary, Sir Robert

  Farr, John

  Atkins, Humphrey

  Channon, H. P. G.

  Fell, Anthony

  Awdry, Daniel (Chippenham)

  Chichester-Clark, R.

  Finlay, Graeme

  Balniel, Lord

  Clark, Henry (Antrim, N.)

  Fisher, Nigel

  Barber, Rt. Hon. Anthony

  Clark, William (Nottingham, S.)

  Fletcher-Cooke, Charles

  Barlow, Sir John

  Cleaver, Leonard

  Foster, Sir John

  Barter, John

  Cole, Norman

  Fraser, Rt. Hn. Hugh (Stafford & Stone)

  Batsford, Brian

  Cooke, Robert

  Fraser, Ian (Plymouth, Sutton)

  Beamish, Col. Sir Tufton

  Cooper, A. E.

  Freeth, Denzil

  Bell, Ronald

  Cooper-Key, Sir Neill

  Galbraith, Hon. T. G. D.

  Bennett, F. M. (Torquay)

  Cordeaux, Lt-Col. J. K.

  Gardner, Edward

  Bennett, Dr. Reginald (Gos & Fhm)

  Cordle, John

  Gibson-Watt, David

  Berkeley, Humphry

  Corfield, F. V.

  Gilmour, Ian (Norfolk, Central)

  Bevins, Rt. Hon. Reginald

  Costain, A. P.

  Gilmour, Sir John (East Fife)

  Bidgood, John C.

  Courlson, Michael

  Glyn, Dr. Alan (Clapham)

  Biffen, John

  Courtney, Cdr. Anthony

  Glyn, Sir Richard (Dorset, N.)

  Biggs-Davison, John

  Craddock, Sir Beresford (Spelthorne)

  Goodhart, Phllip

  Birch, Rt. Hon. Nigel

  Crawley, Aidan

  Goodhew, Victor

  Bishop, Sir Patrick

  Critchley, Julian

  Gough, Frederick

  Black, Sir Cyril

  Cunningham, Sir Knox

  Gower, Raymond

  Bossom, Hon, Clive

  Curran, Charles

  Grant-Ferrie, R.

  Bourne-Arton, A.

  Dalkeith, Earl of

  Green, Alen

  Bowen, Roderic (Cardigan)

  Dance, James

  Gresham Cooke, R.

  Box, Donald

  d' Avigdor-Goldsmid, Sir Henry

  Grimond, Rt. Hon. J.

  Boyd-Carpenter, Rt. Hon. John

  Deedes, Rt. Hon. W. F.

  Gurden, Harold

  Braine, Bernard

  Digby, Simon Wingfield

  Hall, John (Wycombe)

  Brewis, John

  Donaldson, Cmdr. C. E. M.

  Hamitton, Michael (Wellingborough)

  Bromley-Davenport, Lt. Col. Sir Walter

  Doughty, Charles

  Harris, Frederic (Croydon, N. W.)

  Brooke, Rt. Hon. Henry

  Drayson, G. B.

  Harris, Reader (Heston)

  Brown, Alan (Tottenham)

  Duncan, Sir James

  Harrison, Brian (Maldon)

  Browne, Percy (Torrington)

  Duthie, Sir William (Banff)

  Harrison, Col. Sir Harwood (Eye)

  Bryan, Paul

  Eden, Sir John

  Harvey, Sir Arthur Vere (Macclesfield)

  Buck, Antony

  Elliot, Capt. Walter (Carshalton)

  Harvey, John (Walthamstow, E.)

  1052

  1053

  Harvie Anderson, Miss

  McLean, Neil (Inverness)

  Royle, Anthony (Richmond, Surrey)

  Hastings, Stephen

  MacLeod, Sir J. (Ross & Cromarty)

  Sandys, Rt. Hon. Duncan

  Heald, Rt. Hon. Sir Lionel

  McMaster, Stanley R.

  Scott-Hopkins, James

  Heath, Rt. Hon. Edward

  Maddan, Martin

  Sharples, Richard

  Henderson, John (Cathcart)

  Maginnis, John E.

  Shaw, M.

  Hendry, Forbes

  Maitland, Sir John

  Shepherd, William

  Hicks Beach, Maj. W.

  Markham, Major Sir Frank

  Skeet, T. H. H.

  Hiley, Joseph

  Marples, Rt. Hon. Ernest

  Smith, Dudley (Br'ntf'd & Chiswick)

  Hill, Mrs. Eveline (Wythenshawe)

  Marshall, Sir Douglas

  Soames, Rt. Hon. Christopher

  Hill, J. E. B. (S. Norfolk)

  Marten, Neil

  Speir, Rupert

  Hirst, Geoffrey

  Mathew, Robert (Honiton)

  Stainton, Keith

  Hobson, Rt. Hon. Sir John

  Matthews, Gordon (Meriden)

  Stanley, Hon. Richard

  Hocking, Philip N.

  Maude, Angus (Stratford-on-Avon)

  Stevens, Geoffrey

  Holland, Philip

  Maudling, Rt. Hon. Reginald

  Steward, Harold (Stockport, S.)

  Hollingworth, John

  Mawby, Ray

  Stodart, J. A.

  Holt, Arthur

  Mills, Stratton

  Stoddart-Scott, Col. Sir Malcolm

  Hope, Rt. Hon. Lord John

  Miscampbell, Norman

  Storey, Sir Samuel

  Hopkins, Alan

  Montgomery, Fergus

  Studholme, Sir Henry

  Hornby, H. P.

  Moore, Sir Thomas (Ayr)

  Summers, Sir Spencer

  Hornsby-Smith, Rt. Hon. Dame P.

  More, Jasper (Ludlow)

  Tapsell, Peter

  Howard, Hon. G. R. (St. Ives)

  Morgan, William

  Taylor, Edwin (Bolton, E.)

  Howard, John (Southampton, Test)

  Morrison, John

  Taylor, Frank (M'ch'st'r, Moss Side)

  Hughes Hallett, Vice-Admiral John

  Mott-Radclyffe, Sir Charles

  Taylor, Sir William (Bradford, N.)

  Hughes-Young, Michael

  Neave, Airey

  Teeling, Sir William

  Hurd, Sir Anthony

  Nicholls, Sir Harmar

  Temple, John M.

  Hutchison, Michael Clark

  Nicholson, Sir Godfrey

  Thomas, Sir Leslie (Canterbury)

  Iremonger, T. L.

  Nugent, Rt. Hon. Sir Richard

  Thomas, Peter (Conway)

  Irvine, Bryant Godman (Rye)

  Oakshott, Sir Hendrie

  Thompson, Sir Kenneth (Walton)

  Jackson, John

  Orr, Capt. L. P. S.

  Thompson, Sir Richard (Croydon, S.)

  James, David

  Orr-Ewing, Sir Ian (Hendon, North)

  Thorneycroft, Rt. Hon. Peter

  Jennings, J. C.

  Osborn, John (Hallam)

  Thornton-Kemsley, Sir Colin

  Johnson, Dr Donald (Carlisle)

  Osborne, Sir Cyril (Louth)

  Thorpe, Jeremy

  Johnson, Eric (Blackley)

  Page, Graham (Crosby)

  Tiley, Arthur (Bradford, W.)

  Johnson Smith, Geoffrey

  Page, John (Harrow, West)

  Tilney, John (Wavertree)

  Jones, Arthur (Northants, S.)

  Pannell, Norman (Kirkdale)

  Touche, Rt. Hon. Sir Gordon

  Jones, Rt. Hn. Aubrey (Hall Green)

  Partridge, E.

  Turner, Colin

  Joseph, Rt. Hon. Sir Keith

  Pearson, Frank (Clitheroe)

  Turton, Rt. Hon. R. H.

  Kaberry, Sir Donald

  Percival, Ian

  Tweedsmuir, Lady

  Kerans, Cdr. J. S.

  Peyton, John

  van Straubenzee, W. R.

  Kerby, Capt. Henry

  Pickthorn, Sir Kenneth

  Vane, W. M. F.

  Kerr, Sir Hamilton

  Pike, Miss Mervyn

  Vaughan-Morgan, Rt. Hon. Sir John

  Kershaw, Anthony

  Pitman, Sir James

  Vickers, Miss Joan

  Kimball, Marcus

  Pitt, Dame Edith

  Vosper, Rt. Hon. Dennis

  Kitson, Timothy

  Pounder, Rafton

  Wade, Donald

  Lagden, Godfrey

  Powell, Rt. Hon. J. Enoch

  Walder, David

  Lambton, Viscount

  Price, David (Eastleigh)

  Walker, Peter

  Langford-Holt, Sir John

  Price, H. A. (Lewisham, W.)

  Walker-Smith, Rt. Hon. Sir Derek

  Leather, Sir Edwin

  Prior, J. M. L.

  Wall, Patrick

  Lewis, Kenneth (Rutland)

  Prior, J. M. L.

  Wall, Patrick

  Lewis, Kenneth (Rutland)

  Prior-Palmer, Brig. Sir Otho

  Ward, Dame Irene

  Lilley, F. J. P.

  Proudfoot, Wilfred

  Webster, David

  Lindsay, Sir Martin

  Pym, Francis

  Whitelaw, William

  Linstead, Sir Hugh

  Ramsden, Rt. Hon. James

  Williams, Dudley (Exeter)

  Litchfield, Capt. John

  Rawlinson, Rt. Hon. Sir Peter

  Williams, Paul (Sunderland, S.)

  Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)

  Redmayne, Rt. Hon. Martin

  Wills, Sir Gerald (Bridgwater)

  Lloyd, Rt. Hon. Selwyn (Wirral)

  Rees, Hugh (Swansea, W.)

  Wilson, Geoffrey (Truro)

  Longbottom, Charles

  Reea-Davies, W. R. (Isle of Thanet)

  Wise, A. R.

  Loveys, Walter H.

  Renton, Rt. Hon. David

  Wolrige-Gordon, Patrick

  Lubbock, Eric

  Ridley, Hon. Nicholas

  Wood, Rt. Hon. Richard

  Lucas, Sir Jocelyn

  Ridsdale, Julian

  Woodhouse, C. M.

  Lucas-Tooth, Sir Hugh

  Rippon, Rt. Hon. Geoffrey

  Woodnutt, Mark

  McAdden, Sir Stephen

  Roberts, Sir Peter (Heeley)

  Woollam, John

  MacArthur, Ian

  Robinson, Rt. Hn. Sir R. (B'pool, S.)

  Wordey, Marcus

  McLaughlin, Mrs. Patricia

  Rodgers, John (Sevenoaks)

  Yates, William (The Wrekin)

  Maclay, Rt. Hon. John

  Roots, William

  Maclean, Sir Fitzroy (Bute & N. Ayrs)

  Ropner, Col. Sir Leonard

  TELLERS FOR THE NOES:

  Mr. Peel and Mr. McLaren.

  Question put, That the proposed words be there added:—
  The House divided: Ayes 299, Noes 232.

  Division No. 18.]

  AYES

  [7.10 p.m.

  Agnew, Sir Peter

  Barlow, Sir John

  Biffen, John

  Allan, Robert (Paddington, S.)

  Barter, John

  Biggs-Davison, John

  Allason, James

  Batsford, Brian

  Bishop, F. P.

  Amery, Rt. Hon. Julian

  Beamish, Col. Sir Tufton

  Black, Sir Cyril

  Anderson, D. C.

  Bell, Ronald

  Bossom, Hon. Clive

  Arbuthnot, John

  Bennett, F. M. (Torquay)

  Bourne-Arton, A.

  Ashton, Sir Hubert

  Bennett, Dr. Reginald (Gos & Fhm)

  Bowen, Roderic (Cardigan)

  Atkins, Humphrey

  Berkeley, Humphry

  Box, Donald

  Awdry, Daniel (Chippenham)

  Bevins, Rt. Hon. Reginald

  Boyd-Carpenter, Rt. Hon. John

  Balniel, Lord

  Bidgood, John C.

  Braine, Bernard

  Brewis, John

  Hastings, Stephen

  Nicholson, Sir Godfrey

  Bromley-Davenport, Lt.-Col. Sir Walter

  Heald, Rt. Hon. Sir Lionel

  Nugent, Rt. Hon. Sir Richard

  Brooke, Rt. Hon, Henry

  Heath, Rt. Hon. Edward

  Oakshort, Sir Hendrie

  Brown, Alan (Tottenham)

  Henderson, John (Cathcart)

  Orr, Capt. L. P. S.

  Browne, Percy (Torrington)

  Hendry, Forbes

  Orr-Ewing, Sir Charles

  Bryan, Paul

  Hicks Beach, Maj. W.

  Osborn, John (Hallam)

  Buck, Antony

  Hiley, Joseph

  Osborne, Sir Cyril (Louth)

  Bullard, Denys

  Hill, Mrs. Eveline (Wythenshawe)

  Page, Graham (Crosby)

  Bullus, Wing Commander Eric

  Hill, J. E. B. (S. Norfolk)

  Page, John (Harrow, West)

  Burden, F. A.

  Hobson, Rt. Hon. Sir John

  Pannell, Norman (Kirkdale)

  Butcher, Sir Herbert

  Hocking, Philip N.

  Partridge, E.

  Campbell, Gordon (Moray & Nairn)

  Holland, Philip

  Pearson, Frank (Clitheroe)

  Carr, Rt. Hon. Robert

  Hollingworth, John

  Peel, John

  Cary, Sir Robert

  Holt, Arthur

  Percival, Ian

  Channon, H. P. G.

  Hope, Rt. Hon. Lord John

  Peyton, John

  Chichester Clark, R.

  Hopkins, Alan

  Pickthorn, Sir Kenneth

  Clark, Henry (Antrim, N.)

  Hornby, R. P.

  Pike, Miss Mervyn

  Clark, William (Nottingham, S.)

  Hornsby-Smith, Rt. Hon. Dame P.

  Pitman, Sir James

  Cleaver, Leonard

  Howard, Hon. G. R. (St. Ives)

  Pitt, Dame Edith

  Cole, Norman

  Howard, John (Southampton, Test)

  Pounder, Rafton

  Cooke, Robert

  Hughes Hallett, Vice-Admiral John

  Powell, Rt. Hon. J. Enoch

  Cooper, A. E.

  Hughes-Young, Michael

  Price, David (Eastleigh)

  Cooper-Key, Sir Neill

  Hurd, Sir Anthony

  Price, H. A. (Lewisham, W.)

  Cordeaux, Lt.-Col. J. K.

  Hutchison, Michael Clark

  Prior, J. M. L.

  Cordle, John

  Iremonger, T. L.

  Prior-Palmer, Brig. Sir Otho

  Corfield, F. V.

  Irvine, Bryant Godman (Rye)

  Proudfoot, Wilfred

  Costain, A. P.

  Jackson, John

  Pym, Francis

  Coulson, Michael

  James, David

  Ramsden, Rt. Hon. James

  Courtney, Cdr. Anthony

  Jennings, J. C.

  Rawlinson, Sir Peter

  Craddock, Sir Beresford (Spelthorne)

  Johnson, Dr. Donald (Carlisle)

  Redmayne, Rt. Hon. Martin

  Crawley, Aidan

  Johnson, Eric (Blackley)

  Rees-Davies, W. R. (Isle of Thanet)

  Critchley, Julian

  Johnson Smith, Geoffrey

  Renton, Rt. Hon. David

  Curran, Charles

  Jones, Arthur (Northants, S.)

  Ridley, Hon. Nicholas

  Dalkeith, Earl of

  Jones, Rt. Hn. Aubrey (Hall Green)

  Rippon, Rt. Hon. Geoffrey

  Dance, James

  Joseph, Rt. Hon. Sir Keith

  Roberts, Sir Peter (Heeley)

  d'Avigdor-Goldsmid, Sir Henry

  Kaberry, Sir Donald

  Robinson, Rt. Hn. Sir R. (B'pool, S.)

  Deedes, Rt. Hon. W. F.

  Kerby, Capt. Henry

  Rodgers, John (Sevenoaks)

  Digby, Simon Wingfield

  Kerr, Sir Hamilton

  Ropner, Col. Sir Leonard

  Donaldson, Cmdr. C. E. M.

  Kershaw, Anthony

  Róyle, Anthony (Richmond, Surrey)

  Doughty, Charles

  Kimball, Marcus

  Sandys, Rt. Hon. Duncan

  Drayson, G. B.

  Kitson, Timothy

  Scott-Hopkins, James

  Duncan, Sir James

  Lagden, Godfrey

  Sharples, Richard

  Duthie, Sir William (Banff)

  Lambton, Viscount

  Shaw, M.

  Eden, Sir John

  Langford-Holt, Sir John

  Shepherd, William

  Elliot, Capt. Walter (Carshalton)

  Leather, Sir Edwin

  Skeet, T. H. H.

  Elliott, R. W. (Newc'tle-upon-Tyne, N.)

  Lilley, F. J. P.

  Smith, Dudley (Br'ntf'd & Chiswick)

  Emery, Peter

  Lindsay, Sir Martin

  Soames, Rt. Hon. Christopher

  Emmet, Hon. Mrs. Evelyn

  Linstead, Sir Hugh

  Speir, Rupert

  Errington, Sir Eric

  Litchfield, Capt. John

  Stainton, Keith

  Farey Jones, F, W.

  Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)

  Stanley, Hon. Richard

  Farr, John

  Lloyd, Rt. Hon. Selwyn (Wirral)

  Stevens, Geoffrey

  Fell, Anthony

  Longbottom, Charles

  Steward, Harold (Stockport, S.)

  Finlay, Graeme

  Loveys, Walter H.

  Stodart, J. A.

  Fisher, Nigel

  Lubbock, Eric

  Stoddart-Scott, Col. Sir Malcolm

  Fletcher-Cooke, Charles

  Lucas, Sir Jocelyn

  Storey, Sir Samuel

  Foster, John

  Lucas-Tooth, Sir Hugh

  Studholme, Sir Henry

  Fraser, Rt. Hn. Hugh (Stafford & Stone)

  McAdden, Sir Stephen

  Summers, Sir Spencer

  Fraser, Ian (Plymouth, Sutton)

  McLaren, Martin

  Tapsell, Peter

  Freeth, Denzil

  McLaughlin, Mrs. Patricia

  Taylor, Edwin (Bolton, E.)

  Galbraith, Hon. T. G. D.

  Maclay, Rt. Hon. John

  Taylor, Frank (M'ch'st'r, Moss Side)

  Gardner, Edward

  Maclean, Sir Fitzroy (Bute & N. Ayrs)

  Taylor, Sir William (Bradford, N.)

  Gibson-Watt, David

  McLean, Neil (Inverness)

  Teeling, Sir William

  Gilmour, Ian (Norfolk, Central)

  Macleod, Sir J. (Ross & Cromarty)

  Temple, John M.

  Gilmour, Sir John (East Fife)

  McMaster, Stanley R.

  Thomas, Sir Leslie (Canterbury)

  Glyn, Dr. Alan (Clapham)

  Maddan, Martin

  Thomas, Peter (Conway)

  Glyn, Sir Richard (Dorset, N.)

  Maginnis, John E.

  Thompson, Sir Kenneth (Walton)

  Goodhart, Philip

  Maitland, Sir John

  Thompson, Sir Richard (Croydon, S.)

  Goodhew, Victor

  Markham, Major Sir Frank

  Thorneycroft, Rt. Hon. Peter

  Gough, Frederick

  Marshall, Sir Douglas

  Thornton-Kemsley, Sir Colin

  Gower, Raymond

  Marten, Neil

  Thorpe, Jeremy

  Grant-Ferris, R.

  Mathew, Robert (Honiton)

  Tiley, Arthur (Bradford, W.)

  Green, Alan

  Matthews, Gordon (Meriden)

  Tilney, John (Wavertree)

  Gresham Cooke, R.

  Maude, Angus (Stratford-on-Avon)

  Touche, Rt. Hon. Sir Gordon

  Grimond, Rt. Hon. J.

  Maudling, Rt. Hon. Reginald

  Turner, Colin

  Gurden, Harold

  Mawby, Ray

  Turton, Rt. Hon. R. H.

  Hall, John (Wycombe)

  Mills, Stratton

  Tweedsmuir, Lady

  Hamilton, Michael (Wellingborough)

  Miscampbell, Norman

  Van Straubenzee, W. R.

  Harris, Frederic (Croydon, N. W.)

  Montgomery, Fergus

  Vane, W. M. F.

  Harris, Reader (Heston)

  Moore, Sir Thomas (Ayr)

  Vaughan-Morgan, Rt. Hon. Sir John

  Harrison, Brian (Maldon)

  More, Jasper (Ludlow)

  Vickers, Miss Joan

  Harrison, Col. Sir Harwood (Eye)

  Morgan, William

  Vosper, Rt. Hon. Dennis

  Harvey, Sir Arthur Vere (Maccelesf'd)

  Mott-Radclyffe, Sir Charles

  Wade, Donald

  Harvey, John (Walthamstow, E.)

  Neave, Airey

  Welder, David

  Harris Anderson, Miss

  Nicholls, Sir Harmer

  Walker Peter

  1056

  1057

  Walker-Smith, Rt. Hon. Sir Derek

  Wills, Sir Gerald (Bridgwater)

  Woollam, John

  Wall, Patrick

  Wilson, Geoffrey (Truro)

  Worsley, Marcus

  Ward, Darne Irene

  Wise, A. R.

  Yates, William (The Wrekin)

  Webster, David

  Wolrige-Gordon, Patrick

  Whitelaw, William

  Wood, Rt. Hon. Richard

  TELLERS FOR THE AYES:

  Williams, Dudley (Exeter)

  Woodhouse, C. M.

  M. MacArthur and

  Williams, Paul (Sunderland, S.)

  Woodnutt, Mark

  Mr. Hugh Rees.

  NOES

  Abse, Leo

  Griffiths, Rt. Hon. James (Llanelly)

  Moody, A. S.

  Ainsley, William

  Griffiths, W. (Exchange)

  Morris, Charles (Openshaw)

  Albu, Austen

  Gunter, Ray

  Morris, John

  Allaun, Frank (Salford, E.)

  Hale, Leslie (Oldham, W.)

  Moyle, Arthur

  Allen, Scholefield (Crewe)

  Hamilton, William (West Fife)

  Neal, Harold

  Awbery, Stan (Bristol, Central)

  Hannan, William

  Noel-Baker, Francis (Swindon)

  Bacon, Miss Alice

  Harper, Joseph

  Noel-Baker, Rt. Hn. Philip (Derby, S.)

  Baird, John

  Hart, Mrs. Judith

  Oliver, G. H.

  Barnett, Guy

  Hayman, F. H.

  O'Malley, B. K.

  Baxter, William (Stirlingshire, W.)

  Healey, Denis

  Oran, A. E.

  Beaney, Alan

  Henderson, Rt. Hn. Arthur (Rwly Regis)

  Oswald, Thomas

  Ballenger, Rt. Hon. F. J.

  Herbison, Miss Margaret

  Owen, Will

  Bence, Cyril

  Hill, J. (Midlothian)

  Padley, W. E.

  Benn, Anthony Wedgwood

  Hilton, A. V.

  Pannell, Charles (Leeds, W.)

  Bennett, J. (Glasgow, Bridgeton)

  Holman, Percy

  Pargiter, G. A.

  Benson, Sir George

  Houghton, Douglas

  Parker, John

  Blackburn, F.

  Howell, Charles A. (Perry Barr)

  Parkin, B. T.

  Blyton, William

  Howell, Dents (Small Heath)

  Pavitt, Laurence

  Boardman, H.

  Howie, W. (Luton)

  Pearson, Arthur (Pontypridd)

  Bottomley, Rt. Hon. A. G.

  Hoy, James H.

  Peart, Frederick

  Bowden, Rt. Hn. H. W. (Leics, S. W.)

  Hughes, Cledwyn (Anglesey)

  Pentland, Norman

  Boyden, James

  Hughes, Emrys (S. Ayrshire)

  Popplewalt, Ernest

  Braddock, Mrs. E. M.

  Hughes, Hector (Aberdeen, N.)

  Prentice, R. E.

  Bradley, Tom

  Hunter, A. E.

  Price, J. T. (Westhougton)

  Bray, Dr. Jeremy

  Hynd, H. (Accrington)

  Probert, Arthur

  Brown, RI. Hon. George (Belper)

  Hynd, John (Attercliffe)

  Proctor, W. T.

  Brown, Thomas (Ince)

  Irvine, A. J. (Edge Hill)

  Pureey, cmdr. Harry

  Butler, Herbert (Hackney, C.)

  Irving, Sydney (Dartford)

  Randall, Harry

  Butler, Mrs. Joyce (Wood Green)

  Janner, Sir Barnett

  Rankin, John

  Callaghan, James

  Jay, Rt. Hon. Douglas

  Rees, Merlyn (Leeds, S.)

  Carmichael, Neil

  Jeger, George

  Reid, William

  Castle, Mrs. Barbara

  Jenkins, Roy (Stechford)

  Reynolds, G. W.

  Cliffe, Michael

  Johnson, Carol (Lewisham, S.)

  Rhodes, H.

  Collick, Percy

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

  Roberts, Albert (Normanton)

  Corbet, Mrs. Freda

  Jones, Dan (Burnley)

  Roberts, Goronwy (Caernarvon)

  Craddock, George (Bradford, S.)

  Jones, Elwyn (West Ham, S.)

  Robertson, John (Paisley)

  Cronin, John

  Jones J. Idwal (Wrexham)

  Roberson, Kenneth (St. Pancras, N.)

  Crosland, Anthony

  Jones, T. W. (Merionoth)

  Rodgers, W. T. (Stockson)

  Crossman, R. H. S.

  Kelley, Richard

  Rogers G. H. R. (Kensington, N.)

  Dalyell, Tam

  Kenyon, Clifford

  Ross, William

  Darling, George

  King, Dr. Horace

  Royle, Charles (Salford, West)

  Davies, G. Elfed (Rhondda, E.)

  Lawson, George

  Silkin, John

  Davies, Harold (Leek)

  Ledger, Ron

  Silverman, Julius (Aston)

  Davies, Ifor (Gower)

  Lee, Frederick (Newton)

  Silverman, Sydney (Nelson)

  Davies, S. O. (Merthyr)

  Lever, Harold (Cheetham)

  Skeffington, Arthur

  Deer, George

  Lewis, Arthur (West Ham, N.)

  Slater, Mrs. Harriet (Stoke, N.)

  Delargy, Hugh

  Lipton, Marcus

  Slater, Joseph (Sedgefield)

  Diamond, John

  Loughlin, Charles

  Small, William

  Dodds, Norman

  Mabon, Dr. J. Dickson

  Smith, Ellis (Stoke, S.)

  Doig, Peter

  McBride, N.

  Snow, Julian

  Driberg, Tom

  McCann, John

  Sorensen, R. W.

  Duffy, A. E. P. (Colne Valley)

  MacColl, James

  Soskice, Rt. Hon. Sir Frank

  Ede, Rt. Hon. C.

  MacDermot, Niall

  Spriggs, Leslie

  Edelman, Maurice

  McInnes, James

  Steele, Thomas

  Edwards, Rt. Hon. Ness (Caerphilly)

  Mckay, John (Wallsend)

  Stewart, Michael (Fulham)

  Edwards, Robert (Bilston)

  Mackie, John (Enfield, East)

  Stonehouse, John

  Edwards, Walter (Stepney)

  McLeavy, Frank

  Stones, William

  Evans, Albert

  MacMillan, Malcolm (Western Isles)

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

  Fernyhough, E.

  MacPherson, Malcolm (Stirling)

  Swain, Thomas

  Finch, Harold

  Mahon, Simon

  Swingler, Stephen

  Fitch, Alan

  Mallalieu, E. L. (Brigg)

  Symonds, J. B.

  Fletcher, Eric

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

  Taverne, D.

  Filler, Maurice

  Manuel, Archie

  Taylor, Bernard (Mansfield)

  Foot, Dingle (Ipswich)

  Mapp, Charles

  Thomas, George (Cardiff, W.)

  Forman, J. C.

  Marsh, Richard

  Thompson, Dr. Alan (Dunfermline)

  Fraser, Thomas (Hamilton)

  Mason, Roy

  Thomson, G. M. (Dundee, E.)

  Galpern, Sir Myer

  Mayhew, Christopher

  Thornton, Ernest

  George, Lady Megan Lloyd (Crmrthn)

  Mellish, R. J.

  Tomney, Frank

  Ginsburg, David

  Mendelson, J. J.

  Wainwright, Edwin

  Gourlay, Harry

  Millan, Bruce

  Warbey, William

  Greenwood, Anthony

  Milne, Edward

  Weitzman, David

  Grey, Chares

  Mitchison G. R.

  Wells, William (Walsall, N.)

  Griffiths, David (Bother Valley)

  Monslow, Walter

  White, Mrs. Eirene

  1058

  1059

  Whitlock, William

  Willis, E. G. (Edinburgh, E.)

  Wyatt, Woodrow

  Wigg, George

  Wilson, Rt. Hon. Harold (Huyton)

  Yates, Victor (Ladywood)

  Wilkins, W. A.

  Winterbottom, R. E.

  Zilliacus, K.

  Willey, Frederick

  Woodburn, Rt. Hon. A.

  Williams, D. J. (Neath)

  Woof, Robert

  TELLERS FOR THE NOES:

  Dr. Broughton and Mr. Redhead.

  Main Question, as amended, put and agreed to.
  Resolved,
  That this House approves the intention of Her Majesty's Government to respect the same principle of freedom of communications in the household delivery service as applies to the postal services generally.

  BRITISH LION FILM COMPANY
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Redmayne.]
  7.21 p.m.
  Mrs. Eirene White: If I may use the language of show business, tonight we are presenting another thrilling instalment in the sensational serial, "The Tale of British Lion". It has a star-studded cast. The public has had an ample selection of both heroes and villains, but this episode is directed by an entirely new director. I refer to the Secretary of State for Industry and Trade.
  We now have a very different situation from that which existed on 20th December, when you, Mr. Speaker, kindly allowed us to have a short debate on the Christmas Adjournment, and when we had the Parliamentary Secretary at the Box and he, poor fellow, was entirely unable to tell the House what was to happen to British Lion. He could not give us any information. He was not able to give us any satisfaction as to terms or conditions. In fact, he seemed to know little about the Government's intentions. Therefore, my hon. Friends and I are of the opinion that it is only right that we should use this opportunity to ask for a very much clearer statement from Her Majesty's Government of what they propose to do.
  Had things just been allowed to ride, and had there been no debate on 20th December, it appears to us that by now there would probably have been a completely tied-up package; the whole of the firm would have been sold, as far as we can tell, without any conditions being imposed, to the first person who came along—rather an "old pals" act—and we
  1060
  would have had no opportunity of finding out what was to be done.
  We disagree with the Government on both the principle and on the way in which they have handled the matter, because even after 20th December we were able to read, in The Times of 3rd January, that the first bidder was Mr. Sydney Box. I want to make it clear that in anything I say I do not wish to be derogatory to Mr. Sydney Box—I am criticising Her Majesty's Government—but it seems odd that on 3rd January The Times was able to report that Mr. Box had received the detailed terms on which British Lion was to be sold, and also that he was able to say, in the Sunday Times, two days later:
  "By normal City practice, the Finance Corporation cannot ethically go back on their offer to me."
  In spite of these statements, only last week I had a reply from the right hon. Gentleman to the effect that the legal advisers of the Board of Trade and the National Film Finance Corporation were engaged upon working out the terms which apparently had not seemed necessary to them before 3rd January.
  It was since that date that the right hon. Gentleman himself came into the picture—if I might put it in that way—and took personal responsibility for seeing various people in the film industry, a large number of whom had made it clear that they were far from satisfied with what appeared to be about to happen to the affairs of this extremely interesting and, by this time, prosperous company.
  I should say at the outset that a certain amount of personal mud-slinging has taken place. Although I am not holding any special brief for the directors of British Lion, I should like to remind hon. Members on both sides of the House who might have it in mind to say critical things about them that on 22nd January, 1959—just five years ago—the hon. Member for Sevenoaks (Mr. J. Rodgers), at that time a Minister in the Board of Trade, when referring to these very gentlemen, said:
  "I personally should like to acknowledge a debt to these people who agreed to give up

  1061
  their previous interests and join British Lion at considerable risk to themselves and their own reputations."—[OFFICIAL REPORT. 22nd January, 1959; Vol. 598, c. 554.]
  I say that at the outset because much has been said in criticism of the way in which the contract has worked out.
  Let there be no misunderstanding; when that contract was made the persons concerned, on both sides, were of the opinion that it was a very risky business. Therefore, we should be quite clear that the considerable success which has attended the efforts of British Lion Films Limited since that time is to be attributed to the work, enterprise, initiative, and considerable vitality of those directors. The fact that the relationship between them and the National Film Finance Corporation—both chairman and managing director—has not always been of the happiest or easiest does not detract from the real achievements of British Lion.
  My hon. Friends and I object in the strongest possible terms to the declared intention of Her Majesty's Government to sell British Lion 100 per cent. to a private buyer. We are by no means the only ones who object to this. Large sections of those who have any knowledge of the film industry have objected. We have the Federation of British Film Makers—an organisation which represents the independent producers—the Cinematograph Exhibitors Association, which is far from being a Left-wing body, and we have the unions. Privately, we even have some leading directors of the circuits, who do not wish to go on record but who are emphatic in their private opinions that it would be a good thing if there were some continuing participation in British Lion. Lastly, although the right hon. Gentleman did not wait for it, we have the opinion of the Films Council, which is there to advise the right hon. Gentleman on these matters.
  I am in a difficult position, because I am a member of that Council. Normally its decision are not published except in the form of an annual report. On the other hand, it would be unrealistic not to refer to the advice which by now, as everyone knows, has been tendered to the right hon. Gentleman. It was the opinion of the Council that some public participation would have been desirable.
  1062
  Why is there this wide range of opinion in favour of some degree of public participation? It is because those of us who know anything about the industry do not believe that a purely privately-owned company can remain independent in the present monopolistic state of the industry. I know all the difficulties that the right hon. Gentleman can adduce but if he had been prepared to wait and to say, "For the time being we will continue some public stake in this," and had done something about the monopolistic state of the industry, it would have been another matter. But he is not yet in a position to do anything.
  One has only to look at past history to realise that the chances of a completely privately-owned distribution firm remaining generally independent in the present state of the industry is very slim. Six years ago, there were seven independent distributors. Now there is only one, and that is British Lion. One has it on record that the present directors, after six years' successful experience, to quote from one of their documents,
  "are convinced that the company's special rôle in the industry could not be maintained if the Board were responsible only to private investors."
  They are convinced from their experience that the kind of pressure which can be exercised directly or indirectly will make it virtually impossible for those who are concerned only with commercial considerations and not with considerations of the public interest to maintain their independence Why should they be concerned with the public interest if they are a 100 per cent. commercial firm? That would be asking a bit much. They put in private money and their responsibility in those circumstances is to their shareholders. In that case, there is no margin to allow for manoeuvre or for judgment of what would be in the public interest.
  To us on this side it appears that, for what we consider to be doctrinaire reasons, the President of the Board of Trade is being quite unrealistic about the probability of genuine independence. The other day, in answering Questions in the House, the right hon. Gentleman made a point about my right hon. Friend the Leader of tae Opposition and suggested that when the National Film Finance Corporation was established, it was not

  1063
  the intention of the Labour Government that it should engage directly in matters of production or distribution. When, however, one looks at the speech of my right hon. Friend the Leader of the Opposition in July, 1948, it is clear from what he said that the two reasons for establishing Government finance in film making were, first, a balance of payments question, and secondly, that stability could be introduced into independent film production. My right hon. Friend went on to say that at later date
  "it may be practicable for the Corporation to help in financing other experiments in methods of production and distribution."—[OFFICIAL REPORT, 22nd July, 1948; Vol. 454, c. 587.]
  It was clear that this was intended to be a flexible instrument which could be adapted to the changing needs of the cinema industry.
  We all know very well that the situation in the industry has changed considerably since 1948. It is no fault necessarily of the monopoly interests concerned, but is an historical progression, that the pressures of monopoly in a relatively declining industry have intensified. We believe, therefore, that there is the strongest possible case for maintaining a public stake in the company.
  The other reason which has been advanced, apart from the doctrinaire one, for selling outright has been that the National Film Finance Corporation is in need of money and that, therefore, it must realise its capital assets to obtain current finance. This, surely, is a most unstatesmanlike way of proceeding. If the Government were serious in their concern for the film industry, why, for instance, did the National Film Finance Corporation, as can be seen from its report, have to wait several months before it could get back the £591,000 paid over by British Lion last spring and which the Corporation did not get its hands upon until well into the summer? The worst possible time for the Corporation was when the President of the Board of Trade was Chief Whip in charge of Government business and owing to the mismanagement of their business in 1957, there was a period when the powers of the Corporation lapsed entirely because the Government had not caught up with the necessary legislation.
  1064
  In paragraphs 27 to 29 of its last available report, the National Film Finance Corporation makes a strong case for an increase in the money available to it because of the changing conditions in the industry. I do not wish to go into that particularly, but I repeat that in our view, if the Government are serious about assisting British film production, to make the National Film Finance Corporation sell its capital assets is not the most statesmanlike way to go about things.
  I have said enough to make plain our general attitude towards the sale and I should like, therefore, to come to the other main point concerning British Lion, on which, I hope, we will have enlightenment from the President of the Board of Trade: that is, the conditions and safeguards which he proposes to establish. Even on the Government policy of outright sale, we have had the assurances of the Minister that there will be certain conditions and safeguards. Mr. Terry, of the National Film Finance Corporation, said that they were to be published tomorrow, but I trust that the right hon. Gentleman will at least do us the courtesy of giving them to us tonight. I hope, therefore, that he will give a straight answer to some of the questions which I wish to put to him.
  First, are all the conditions to be published and made public so that every bidder will know precisely what they are and there will be no question of slanting them as between one bidder and another? This is extremely important. Secondly, will the right hon. Gentleman assure us that another recommendation of the Cinematograph Films Council will be observed, namely, that it shall be a condition of sale that, whoever buys British Lion, should he at any time wish to dispose not only of his entire interest, but of any part in it, either in shares or in capital assets—in particular, Shepperton Studios—shall give the National Film Finance Corporation the first option of buying either the shares or the property? This does not necessarily mean that the Corporation would wish to exercise that option—it might say that it was not necessary—but it is important to have this pre-emption clause written into any contract of sale.
  I have mentioned Shepperton Studios. We have been told at various times that

  1065
  their maintenance for film production would be a requirement, but as we have had so many obiter dicta from Mr. John Terry I prefer to have it from the Minister. We were told that Shepperton Studios would have to be maintained provided that they did not show a loss. It is easy to manufacture a loss—there is nothing simpler—or one might have a real loss. It might, nevertheless, be in the public interest that Shepperton Studios should be maintained as studios for film production—I am not saying that there should not also be television production, which there has been—that they should not be sold off, for example, to property developers and that this should be specifically included in any conditions of sale.
  I wish to ask one or two questions about the criteria to be observed and not the legal formulæ. We have been told from time to time that whoever is to be regarded as the successful bidder must show the necessary financial strength. Obviously, he must be able to find the fixed purchase price; it is not an auction, but a valuation. Clearly, any suitable person must have the possibility of further resources, because it is no good merely buying the company; one must also be able to help to finance further production. Is anything specific being laid down as a condition for this, or is it simply a matter for subjective judgment—one trusts at least by the President of the Board of Trade, and not just by the National Film Finance Corporation?
  Then we are told that those concerned must have "skill in management". No one could quarrel with that in general terms, but I am extremely anxious about a more particular aspect. "Skill in management" can mean more than one thing. It can mean skill in financial management, which is very proper and necessary, but it can also mean judgment of films and film production. This is where a great deal of the anxiety lies. It is extremely important if British Lion is to fulfil its proper function that it should not only have financial stability, which clearly is desirable, but that it shall be in the hands of people who will bring confidence to the live, vigorous British producers, people by whom they are prepared to be judged. If this fails and if it is handed over to someone for
  1066
  whose judgment they have very little respect, serious damage can be done. The Minister is looking worried, but he has got himself into this position.
  The Secretary of State for Industry, Trade and Regional Development and President of the Board of Trade (Mr. Edward Heath)indicated dissent.
  Mrs. White: If the right hon. Gentleman is not worried he should be, because he has a difficult choice to make.
  Another point which has been raised is the connection with existing circuits. I quite agree that "connection" is a difficult word. Obviously one has some concern if one merely books a film with a circuit. That is not what we mean. We are tremely anxious that there should be true independence of the existing circuits; in other words, that there should not be interlocking interests which would bring British Lion into the orbit of the existing circuits.
  If that happened there would be no point in this whole operation. We are also concerned that British Lion should remain in British ownership. This is not that we are being jingoistic. There is, after all, considerable American finance now available for British film-making. There is no reason why that should be extended by selling British Lion to American interests. I hope very much that British Lion will remain British.
  We also hope that before coming to any decision the Minister will obtain from anyone who is being seriously considered a complete declaration of his interests, not merely in film production or distribution, but also in television or theatrical agencies, because there are these interlocking interests in the world of entertainment. Those who know anything about it are most anxious that the monopoly over people as well as over money and cinemas should not be extended.
  It is most important that before coming to a decision—I repeat that it is not an easy one—the Minister should take all these factors into consideration, because we believe them to be of the greatest importance for healthy British film production. I think it only right, without mentioning any names, because one does not want to be personal, to put on record the considerations which

  1067
  we know from our knowledge of the industry and people working in it are in the minds of producers, stars, actors, other distributors, and so on.
  I want to say a word or two about the more general state of the industry. It is largely because there are anxieties about the position in the British filmmaking industry in general that we are particularly anxious about what is likely to happen to British Lion. I am not pretending for a moment that the right or wrong decision over it will make all the difference to the future of the British production industry, but it can make a great deal of difference. On the other hand, there are other even more important matters which need the attention of the right hon. Gentleman and on which we ought to be told tonight what his attitude is. As he knows, one of the most baffling problems in the film industry at the moment is the increasing booking power of the two circuits and the diminution of independent exhibition, and thereby the diminution of outlets for independent producers.
  The proposal has been made, and was endorsed by the Cinematograph Films Council, that an attempt should be made to see whether some third booking force could be established in the film industry. Recently the right hon. Gentleman has said a great deal about monopoly, the desirability of competition, the wind of change and so on. Has he brought that about in the film industry? If he could solve that problem I should have a great deal of respect for him. He is here confronted with a very difficult monopoly situation. It seems that the Cinematograph Films Council has advised him that it believes something could be done, but, apart from making a few technical proposals, it has failed to make detailed recommendations about how this could be carried out. In effect, the Council has passed it over to the Board of Trade.
  I should like to know whether the right hon. Gentleman is considering having a further inquiry into this matter. As a member of the sub-committee of the Films Council, I think we did a useful job in a relatively restricted sphere. I do not think we were capable of undertaking the sort of inquiry which would be necessary to take seriously the need for a third booking force in film exhibit-
  1068
  tion I do not think the Board of Trade is capable of that either.
  Mr. John Davis suggested that we needed a Beeching for the film industry. We might have rather mixed feelings about that, but there is something to be said for having a quick, although detailed, inquiry by some person outside the industry, an examination by someone who certainly is competent and wants the industry to survive and to prosper, but who is not looking over his shoulder at his own interests or his master's interests in bingo, bowling or property deals. We want someone with the kind of mind which Lord Gardiner has, with an accountant on the financial side. Unless we can get that kind of evidence it will be very difficult to see how far this serious proposal will be practicable.
  I hope that the right hon. Gentleman may take this point seriously because at the moment we have a great deal of complaint and allegations made by one side or the other, and they are difficult to prove one way or the other unless we have the evidence and access to figures. Real and hard evidence is needed in some of these situations. At present allegations are made by the independent producers that films are being held up. The circuits deny that, but in fact there have been one or two films which were held up and which are proving reasonably successful. The gravamen of the charge is not so much that they are held up but that other films—American-financed films for the most part—have been allowed preference and better booking potential although they are inferior films, not only aesthetically but financially.
  This needs to be brought into the open and examined. When I say it should be brought into the open, I do not necessarily mean that it should be published abroad. We are told that of the 10 top-showing films in a recent period in the Rank system seven were British. Of the lowest earning, three were British and seven were American. That was the proportion in reverse. In A.B.C. the figures were similar. This adds validity to the suggestion that the two circuits are so closely allied with American interests that British film producers are not kept out, but are not

  1069
  given the kind of terms to which their quality entitles them.
  Our case is straightforward. We believe that there should be public participation in British Lion. We wish to know what the safeguards are so that we can judge whether they are adequate or not. We think that if the Government are serious about British film production they should strengthen both the board and the finances of the National Films Finance Corporation. There is a very strong case for an independent inquiry to examine adequately the proposal for a third booking force. Meanwhile, we hope very much that, whatever decision the Minister comes to on the future ownership of British Lion, he will not shatter the confidence of the live, vigorous, creative young British film-makers by making a choice which would put them in thrall to mediocrity, to foreign finance or to interests whose real concern is not with film-making at all, but with other moneymaking ventures.
  Unless we can feel satisfied on all these points, we shall feel obliged to divide the House at the end of this debate.
  7.50 p.m.
  The Secretary of State for Industry, Trade and Regional Development and President of the Board of Trade (Mr. Edward Heath): The hon. Lady the Member for Flint, East (Mrs. White) has made it quite plain that she and her hon. Friends are entirely opposed to the Government selling British Lion.
  The hon. Lady started by saying that had it not been for the adjournment debate just before Christmas this company would undoubtedly have been sold. All the arrangements would have been tied up, and it would have been sold without conditions and without anybody knowing anything about it. There is no justification whatever for that remark—absolutely none. Any arrangements for the sale of British Lion must have been given to the House and made public. It has always been the intention that the independence of British Lion should be maintained, although British Lion might be sold. I hope that I have made that absolutely plain.
  The hon. Lady said that she objected to the sale of British Lion and accused those of us who are responsible for the National Film Finance Corporation of
  1070
  being doctrinaire. She gave absolutely no reasons why she objected to the sale of British Lion, with the exception of the question of the capability of independence, and with that I wish to deal in some detail. I hope that for her part she is not taking a doctrinaire view about this and saying that the Government must remain in British Lion even though there are ways of maintaining its independence. That is the crux of the argument on which we are engaged in this debate.
  I should like to give some of the background to this matter because the hon. Lady has mentioned it. When it comes to the question whether the Government ought to remain in British Lion, in the way that she wishes, or whether it should be sold, one should ask oneself; what is the purpose of the Government being connected with the film industry at all? The purpose was very clearly set out in 1949 in the Cinematograph Film Production (Special Loans) Act, which set up the National Film Finance Corporation.
  Its purpose was then set out quite clearly. It was to make loans for the financing of film production or distribution. That was the position which the present Leader of the Opposition defended in the House. I have looked up what he said at the time. I think that it bears repeating. He said:
  "The scheme set out in the Bill starts from three points: First, we consider it essential that working capital must be found to enable the industry to carry out the production programme of which it is capable. Secondly, I think it is necessary to affirm that the industry's financing must be on an entirely self-liquidating basis. There must be no question of a subsidy for film production. Thirdly, that the special emergency arrangements proposed here should be temporary, and that in a resonable period when the industry has built itself up again and established confidence in itself it should be able to float itself free of the special arrangements and revert to more normal methods of financing."—[OFFICIAL REPORT, 2nd December, 1948; Vol. 458, c. 2186]
  That was the basis on which the Government provided money for the film industry. As the hon. Lady knows, there was never any intention that it should go into a company engaged in production and distribution. I will come later to the question whether the circumstances have so greatly changed that this is the only way of dealing with this new circumstance.
  As I explained to the House on 16th January, the Government got into British

  1071
  Lion, as one might say, by accident. The reason is also well known, that having lent the present British Lion's predecessor about £3 million, which it had lost, they acquired the firm as the only way of saving anything from the wreck. The loan of £3 million had been authorised from 1948 to 1950 because at that time the cinema was the main entertainment of the public. Its screens were dominated by American films that involved a dollar trade which we could not at that time afford, so British film production had to be increased and the old British Lion, which was the main distributor for British films, had to be kept alive.
  After the loss of the loan a Receiver and Manager was put into the old firm, which was then wound up, and the new company, with £569,000 new capital contributed by the National Film Finance Corporation, began its operation in 1955. Then the National Film Finance Corporation repeatedly said that it was its intention to return the company to private hands, as soon as it was prosperous enough to attract private investment. This was made clear in the annual reports for the years ended 31st March, 1957, 1958, 1959 and 1962.
  Therefore, the position of the National Film Finance Corporation has been consistent. The Government have also made it clear that they endorsed this policy that when a suitable occasion arose it should be returned to private hands and should be able to attract private investment. There has never been any question, so far as I understand it, from either side of the House, of using Government money to subsidise the film industry.
  The question is: is this the time at which British Lion should be returned wholly to private enterprise? The view of Her Majesty's Government is that the reversion of its ownership to the National Film Finance Corporation, which came about before Christmas because of the use of the options, provides a suitable opportunity for this to happen. The hon. Lady asked whether it would not be possible to hold on to this company until some action had been taken either on the Film Council's report or on the general question of monopolies, but I do not believe that
  1072
  what would be an interim arrangement—if that is what she really proposes—while action is begun about monopolies, would be a good thing for the company or for the health of the British film industry.
  Therefore, the question that we have to examine is whether or not this is a suitable occasion for British Lion to be returned to private enterprise and to raise private capital, at the same time maintaining its independence. Our view is that it is.
  The hon. Lady quite rightly, if I may say so, paid tribute to the five executive directors of the company, and I thoroughly endorse that. The story of their success has already been told, and I related it in the statement I made to the House in January. The company was in the doldrums at the end of 1957, when the five executive directors were appointed. There was a sale to them then of the £9,000 worth of deferred shares and, in 1961, the option arrangements were made so that they could carry on the management for the further period of three years.
  It was these option arrangements that enabled them to realise in cash the results of their good management. I believe, also, that they have made certain sacrifices for the good of the company—in the means of production of their own films, in the fees they took, and in other ways—and they have reaped the rewards of their initiative and enterprise, their skill in management, and the sacrifices they were prepared to make.
  I told the House that the five executive directors had, between them, realised the sum of £795,000. At the same time, I should like to emphasise the financial aspects of the arrangement for the Government. The Government have recovered their investment of some £590,000 which was put into the company; in other words that has gone back to the N.F.F.C. The Government will also realise the £795,000 on their own £9,000 of shares. We must, therefore, look fairly at the return to the N.F.F.C. and the Government, in addition to the return to the directors who have been working in the company for this period.
  I was asked why the sale of British Lion should take place when the company is prosperous. It is true that,

  1073
  the announcement having been made—in accordance, again, with the former policy of the Leader of the Opposition—that it should be returned to private enterprise, attempts were made to sell the company between 1957 and 1959, when it was not prosperous, and, in fact, in one year when it was making a very heavy loss. It then attracted no worthwhile bids of any kind, and it was not possible to sell it. The fact is that now the company has been able to show that it is successful there are seven groups who are buyers in the market for that company. That endorses the view that, if the company is to be returned to private enterprise, this is a suitable occasion on which that should happen.
  Let me turn to the general question, and the reasons for returning British Lion to private enterprise. The fact is that British film distribution is a highly individual and speculative business, and is bound to remain so. In our view, it is not one in which a Government should normally participate. The taxpayer is already financing, and will continue to finance, film production through the National Film Finance Corporation. That, I believe, is a justifiable procedure and one which we have carried on during the term of this Government. I do not believe that the industry can reasonably expect more public money by way of a permanent investment in British Lion, nor do I think it a suitable means of investing public money.
  Secondly, as I have already explained, the ownership of British Lion is an accidental matter, and it has always been the intention that the company should return to private hands when possible.
  But, thirdly, we believe that it is for the good of the industry that it should stand on its own feet. Great changes are taking place today. The full impact of television—possibly, of pay-television—on film making has yet to be felt. The making of films for cinemas will continue to enjoy very substantial support by means of the Eady levy, which increases British producers' commercial returns in the home market by about 60 per cent., by the screen quota, and by finance from the N.F.F.C. This is the
  1074
  contribution which the Government and the taxpayer make to the film industry.
  I also believe that the ownership of British Lion, subject to conditions that I shall mention a little later, by enterprising private interests is the best equipment that it can have for facing these changes. It will also have the advantage that it will bring substantial new private funds into the industry. The hon. Lady and, I know, some of her hon. Friends, dismiss this rather lightly, but I believe that it is important that these resources should be brought from private sources into the film industry, and as the N.F.F.C. has its own source of finance, which the Government arrange, this, will enable, as the hon. Lady has suited, the N.F.F.C. to use for the industry's benefit such of the receipts from British Lion as may be necessary in the light of the discussions I shall be having with it.
  Let me turn to the main argument produced by the hon. Lady—the independence of British Lion. She has said that the Government's stake should be retained in the company because only in this way can the company's continued independence be ensured. It is perfectly true, as the hon. Lady has said, that many of those who came to see me emphasised this point but, above all, they emphasised the fact that they wanted to see the continued independence of British Lion and that is the objective to ensure. In that case, we are both agreed about the desirability of maintaining the company's independence, but I believe that the independence of British Lion depends on the right selection from among those groups now seeking to buy it, and upon the conditions that we propose to stipulate for its purchaser.
  Perhaps I may now say something about these points. The hon. Lady asked me a number of questions, and I think that she will find that they are covered by the points I shall put before the House. They are the points that the N.F.F.C. will be able to place before all bidders. There is absolutely no desire that any of this should be slanted in any way—if I may say so, it was rather an unhappy thought of the hon. Lady's that that should be the case with the National Film Finance Corporation—
  Mrs. White: No. With great respect, what was happening with Mr. Sydney Box before Christmas? It was not thrown open then. Negotiations had been conducted with him to the point that he believed that the National Film Finance Corporation was ethically bound to continue them. If conditions could have arisen in which he believed that that was so, surely it was not open to all, and it had not been made at all clear that that was to be the position.
  Mr. Heath: At that point, which was the time of the debate, Mr. Box was the only person who had approached the Corporation, as I announced in my statement in January.
  Mrs. White: But the Corporation had entered into negotiations with him.
  Mr. Heath: The Corporation had authority to enter into negotiations with him, but that did not exclude its entering into negotiations with others, and that has taken place. The facts speak for themselves.
  Mr. Douglas Jay: Is the right hon. Gentleman aware that The Times announced that the sale to Mr. Box was an accomplished fact? Although The Times is not necessarily infallible, surely that announcement was enough to arouse considerable anxiety.
  Mr. Heath: The right hon. Gentleman may prefer to believe what he sees in the Press, but that has never been an accomplished fact. No sale can take place without my authority, and there is no question of reports of that kind being accepted as the truth.
  Let me now come to the points that will be put to those wishing to purchase the company—
  Mr. Eric Lubbock: Is it not true that Mr. John Terry said, and was quoted by the Daily Telegraph as saying, that
  "… unless and until these negotiations fail"—
  that is, the negotiations with Mr. Sydney Box's group:
  "we are not offering the business elsewhere. We are not auctioning British Lion"?
  Mr. Heath: I cannot answer for what Mr. Terry said, or for newspaper
  1076
  reports. I am answerable for the authority I give for the sale of this company, and that is what I am putting to the House.
  Mrs. White: Can we get this quite clear? It is perfectly plain from what Mr. Terry is reported as having said that he was under the impression that he was enabled to negotiate, and there was no suggestion at that time that he had to find out from the Board of Trade what conditions were acceptable. At what point did the Board of Trade tell him that he had to go to the Department, that his conditions would be vetted, and that it would not all be tied up?
  Mr. Heath: It has always been the case that any proposal for the sale of the company must come to me. There can never have been any question about that, and that was fully recognised by the Chairman and by the Secretary of the National Film Finance Corporation. They were absolutely clear about it, and there can be no question about that whatever.
  I now wish to put before the House the points that are to be put to the groups that wish to purchase the company. It is intended that, probably by the device of holding a single special share in the company, the N.F.F.C. should retain certain rights. These rights will include the right to veto the company's voluntary liquidation, the right to veto the sale of its undertaking, the right to veto the repayment of any capital to shareholders and any disposal of its interest in Shepperton Studios Ltd., except in defined circumstances which would be in the judgment of the special shareholder.
  It will also be ensured, probably by the same device, that a sum equivalent to any tax relief enjoyed by the company as a result of the use of the present accrued tax loss will revert to the National Film Finance Corporation. The Corporation will also have the right to nominate a director to the board so that the Corporation and the Government will be fully apprised at all times of the conduct of its affairs.
  These provisions, which will be permanently effective, should ensure that no purchaser of British Lion shares can

  1077
  strip it of its assets or do anything but continue to operate it as a going concern. It will also mean that no cash made from an authorised sale of any assets can be removed from the business without the agreement of the N.F.F.C.
  In addition, the purchasers will be required to give positive assurances to the National Film Finance Corporation that British Lion will continue to provide the facilities for independent producers which it now gives and continue to maintain an independent position.
  Those are the conditions which have already been made known to the seven groups which had applied to buy British Lion by the closing date, 31st January.
  The company is being offered at a price based on the independent valuation of 30th September. This is the price at which the N.F.F.C. bought out the half share of the executive directors. Therefore, there is no question of auctioning the company to the highest bidder. It means that the National Film Finance Corporation can, in referring a proposal to me, judge the other qualifications, some of which the hon. Lady mentioned, and, of course, it will be bound to take into account not only the financial strength of a group in purchasing the company, but also the resources which it will have for operating the company, according to the way it gives its undertaking.
  The Corporation can also form a judgment on skill in management and film production. Also, it will be able to deal with the point the hon. Lady raised about there not being any connection with the existing circuits. I am quite certain that the Corporation has full information about those who are members of the groups and putting in applications for consideration as purchasers of the company.
  I hope that that has answered the hon. Lady's questions. I have set out the situation and the means by which we wish to ensure the continued independence of British Lion.
  Mr. George Wigg: Will the right hon. Gentleman tell the House when these conditions which he has just detailed were first made known to the seven entities?
  Mr. Heath: I have just said that all these conditions have been made known. I canont give the exact date. If I am given the leave of the House to say a few words later, perhaps I can give the date on which they were informed.
  The N.F.F.C. has informed me that all the prospective purchasers will, in the next few days, receive an accountant's certified analysis of British Lion's financial position and the necessary legal documents embodying the conditions and assurances. There will then be reasonable Lime to study these, but, of course, as I told the House in January, speed is important. We do not wish film production to be held up. We do not want the company's staff to be left in uncertainty, and we do not want the value of the company to be in any way jeopardised.
  Mr. Wigg: If the right hon. Gentleman is not sure when the conditions were made known, and he is only now telling the House that the detailed figures will be available, how does he know that, if he had really set his mind to getting as many runners as he could and on circulating all the information, the seven would not have been seventy? Or is the true picture that he started with one and has been forced only by public opinion to get seven runners instead of just Mr. Box?
  Mr. Heath: Not at all. This has been publicly known, and anybody who wished could apply to the National Film Finance Corporation. As I told the House, one had to have a date by which applications should be made; it was only reasonable to fix a date and, of course, other people have considered whether or not they should form or join a group Some, naturally, have withdrawn. There are at present seven groups, and they are being given this information.
  Mr. Jay: If it has been Board of Trade policy all along to make this general offer, why did the Parliamentary Secretary say nothing about it to the House in the debate on 20th December?
  Mr. Heath: It was quite apparent at the time of that Adjournment debate that it was not to deal with British Lion; it was an Adjournment debate on the general film situation, was it not?
  Mrs. White: No. With respect, I let officials of the right hon. Gentleman's Department know on the Monday of that week—the debate was on the Friday—that I proposed specifically to raise the matter of British Lion.
  Mr. Heath: The hon. Lady will recall that this was a very early moment after the arrangement regarding the options and the opportunity given to the five existing directors to consider whether they themselves wished to exercise their second option and buy back the company. One could not expect my hon. Friend the Parliamentary Secretary to go into all the details of this question at that time.
  Mrs. White: But, with respect, the five directors, according to their contract, had six months to consider their second option. They did not have six months to consider it; they had a fortnight.
  Mr. Heath: There was no question of six months—
  Mrs. White: They never had it.
  Mr. Heath: —as far as the option was concerned. As the hon. Lady knows, the chairman of the N.F.F.C. informed the chairman of the company on 27th November of his intention because he was already convinced, as I have said, that the directors did not wish to exercise their second option, so it was quite right that the N.F.F.C. should exercise its.
  I have informed the House of the details of the arrangements which are to be put to the groups. The groups will receive the accountant's certified analysis of British Lion's financial position. I hope that this matter can then be dealt with speedily.
  I have referred to the arrangements for dealing with the tax loss, which does not become the property of the group buying the company. In this connection, I wish to correct a slip which I made on 30th January when, in answer to a supplementary question from my hon. Friend the Member for Louth (Sir C. Osborne), I said that none of the loss had been applied before arriving at British Lion's profits in recent years. This was incorrect. What I was referring to was the proposal I have just mentioned relating to the tax loss for the future company.
  1080
  The other argument used by the hon. Lady is that the Government's presence in British Lion is necessary to act as a brake on the two great circuits. This point has been made to me by many people, but I must confess that they have never been able to explain why an N.F.F.C. investment in British Lion has been effective in acting as a brake on the circuits. This is a point to which I have given great care and attention, and people have endeavoured to explain it. It may be that it is a psychological point. I do not know. However, it is a matter with which I now wish to deal.
  The hon. Lady has referred to the report of the Cinematograph Films Council, and she has asked me for my comments on it. She will accept that the Council has been considering this matter since the summer of 1962. Only in the last few days has it come to its final conclusions on the report. So far, these have not been formally remitted to me; I have not received them from the chairman of the Council. Therefore, to ask me to give my comments on the sub-committee's report and on the recommendations is, to say the least, premature. This is not to say that I am not most anxious to deal with the matter as speedily as possible.
  I have noted the suggestion of the hon. Lady that there ought now to be a further inquiry into some of the questions with which the Council has dealt. Naturally, I shall give them the fullest consideration. I cannot tonight commit the Government to doing so. What we shall do is to give the fullest consideration to the report and the Council's comments upon it in order to deal with the question of monopoly.
  I understand that the Council has said that it would like more competition brought into the industry, and it wishes me to examine the feasibility of this. As I understand it, what the Council says falls far short of finding an abuse of monopoly. I think that this was really what the hon. Lady had in mind when she said that it was very difficult, on many occasions, to find the hard facts on which to form a judgment on some of the accusations which were made. Again, she is quite right. The problem is that we are dealing with this situation in what is still a steeply declining industry.
  I shall give the House just two or three figures. During the last 10 years,

  1081
  including 1963, admissions to cinemas have fallen by about 70 per cent. The number of cinemas has fallen by 51 per cent., and the number owned by the two major circuits has fallen by 34 per cent.
  The first assurance I can give is that we shall pay the greatest attention to the recommendations of the Cinematograph Films Council on the question of monopolistic practices. My second assurance is that if the Government's presence is important, the Government's presence will still remain through the National Film Finance Corporation. As I have said, they have a member on the board. They have rights which will be enshrined in the special share. They have a firm arrangement there. Also, the National Film Finance Corporation will continue to have a stake in a large proportion of British independent film production. That is what the Corporation is there for. It will retain that, and it is a very important stake indeed.
  During the five years to March, 1963, the Corporation has been responsible for financial support to 57 first-feature films. During the same period British Lion directly invested money in 11 films. It is, therefore, clear that because of this stake at the production stage, the Corporation has the strongest incentive to resist any possible discrimination against independent production by the so-called duopoly … or monopoly, if hon. Members prefer so to describe it—because of its investment in independent film production anyhow and the scale on which it is doing it. Therefore, those who are anxious for psychological reasons, which I respect, or for reasons of artistic integrity, which, again, I respect, or whatever the reason, think that there should be this presence, will have it in the form of the National Film Finance Corporation.
  I take this opportunity of thanking all of those who have given me the benefit of their advice in the last few weeks, covering almost the whole spectrum of the film industry. I found the discussions extraordinarily interesting and, indeed, fascinating. I appreciate the trouble they took to brief me on the intricacies of what I think even the hon. Lady the Member for Flint, East must agree is a highly complex industry. I hope that they will feel that in the arrangements which I have just set out for the sale of
  1082
  British Lion we have taken note of many of the suggestions which they put forward. I hope that they will agree that in this way, having reached a conclusion now, the company can best serve the British film industry by returning to private enterprise. I repeat that we have taken note of and embodied the suggestions they made.
  The hon. Lady mentioned the advice that I received from the Cinematograph Films Council. I noted it. I read in the Press that it was by a narrow majority. Of course I pay attention to the advice. I am grateful to the Council for its thinking about this problem. It is seldom in the past that my predecessors have not felt themselves able to accept most of its advice, but in general it advises about matters which are internal matters for the film industry. On this occasion it has advised about a matter on which there are wide opinions and in which considerations of the taxpayers' interests are also involved.
  I hope, therefore, that I have been able to explain to the House why we believe it is right that British Lion should be returned to private enterprise and why we believe that this is a suitable occasions for it to happen. I hope, also, that I have submitted to the House reasonable arrangements for ensuring the future independence of British Lion and arranging that it should continue to be of service to independent British film production, which is what we all want.
  8.23 p.m.
  Mr. Maurice Edelman: I cannot help feeling that no one on these benches and very few who work in the industry will be reassured by what the right hon. Gentleman has just said. He has belatedly produced a series of conditions for the sale of British Lion. He speaks now of "conditions". In the Adjournment debate his Parliamentary Secretary spoke of assurances, saying:
  "The N.F.F C. has agreed with my right hon. Friend that it will be a condition of sale of British Lion that the purchaser will give firm assurances that the facilities which the company now makes available to independent producers will continue to be made available to them, and that the company will continue to be operated as a third force in the industry."…[OFFICIAL REPORT, 20th December, 1963; Vol. 686, c. 1692.]

  1083
  That last is now made a "condition," but I do not believe that such a condition, that British Lion in private hands shall secure the independence of independent film producers—even under the conditions which have operated in the past—is enforceable. Looking at the list of bidders for the company, and thinking of the company in private hands, and taking into account what has been said about the guarantee of a Government presence in the full sense, I cannot feel that those who will own British Lion in future can be trusted to operate the company under the same conditions as provided some security in the past.
  Listening to the right hon. Gentleman, I was not surprised that his whole test of the value of the transaction was what its profitability was likely to be. It is extraordinary that in the whole of this discussion on the film industry the only test has been profitability, when what we are really concerned with is a great national asset, an ingredient of our national culture and something which concerns not only the livelihood of many thousands of people in the industry but also an important art form.
  Mr. John Davis, of Ranks, has described what he considers to be the function of the cinema. He says that that function—I am summarising—is simply to provide entertainment. I can imagine that if that is the sole standard by which the value of the cinema is to be judged, it is not surprisng that the cinema as a whole has fallen into the hands of tycoons, accountants and unsmiling distributors who lunch daily at Les Ambassadeurs. That kind of person is not the person to be entrusted with the cinema as an art form.
  For these reasons, I feel that we should examine the whole basis of this transaction, which has been carried out in an indecent haste, and seems to me to be a rare example of a shotgun marriage in which the bride rather than the bridegroom has been prodded to the altar. We have the example of British Lion, unwilling and reluctant, as expressed in the words of its statement. It is unwilling and reluctant first to be taken over and then to be sold in the form projected by the Minister. Now, after the extraordinary situation in
  1084
  which, first of all, it seemed as if the whole matter was cut and dried and the company was going to be handed over to Mr. Box, the Minister belatedly comes along with a set of conditions which I believe to be unrealisable and unenforceable; and now we have the spectacle of another six bidders suddenly appearing on the scene.
  I am inclined to offer a few observations on some of the bidders, but I will refrain from doing so because I do not want to be prejudicial even in this situation. But I think it would be proper for me to quote what Mr. John Bloom is alleged to have said. When the terms of sale were announced, he is reported to have said that he could not resist the temptation. I can well believe that to be the case, because there is a great temptation in the sale of this company. I am absolutely convinced that the company has a large quantity of concealed assets. It is a company which has great resources. This is illustrated even by the price at which the directors were paid out.
  It is a company which because it has, in a sense, a monopoly of independence is likely to have a very great future. If those who acquire the company are going to apply strictly material and commercial standards of profitability, which the Minister seems to admire so very much, I can see that in an affluent age and at a time when the cinema may once again be in a period of great expansion, this is a company which is certain to attract the attention of the take-over bidders, of the people who have become so expert at diagnosing the assets hidden within a firm and estimating its profitability, the people who are completely indifferent to the cultural values with which, among other matters, the cinema should be concerned.
  No one has spoken in all these debates of what the cinema means to the nation as an art form. If one were to translate the concept of a cinema into terms of books, how improper it would seem if the only publishing house to remain independent were to be sold in such form and on such conditions that one could be absolutely certain that those who were going to exploit it would merely exploit it in the interests of profitability and if the test, in the words of Mr. John Davis, were merely going to be

  1085
  the entertainment value of books and they were completely indifferent to the artistic enterprise and cultural purpose of those concerned with books and the cinema as media for the arts.
  Among those who are bidding for British Lion I see that leading one of the consortia is the name of a distinguished American producer. I certainly would not be in favour of nationalism in the arts, but I believe that it has been a basic concern of all those who have been interested in British films ever since 1926, when the Imperial Conference first stated that to produce a thriving British industry was a concern not only of Britain but of the Commonwealth as a whole. Ever since that date it has been recognised that it is desirable to have an indigenous British film industry and that it should be assisted and cultivated by some form of protection appropriate to the times.
  Since we have had the Eady levy, we have had the incursion, welcome in many respects, of certain American film-makers in Britain. They have done extremely well and have provided employment, and for these reasons I welcome the part that they played. On the other hand, in the interest both of encouraging domestic talent and a domestic film industry, I think that it would be extremely undesirable if this third force, as it has been called, were to come under American domination, or any other domination from abroad, which would have the effect of limiting and restricting in any way the cultivation of native talent in Britain.
  It may be said, to take a purely accountancy view, that if we have American interests in British films we shall attract American capital which will be ploughed back into British films and this will be all to the good of British employment. Heaven knows that at this time many of my friends in the film industry are deeply concerned precisely on this point.
  The Minister talked about decline in the industry. I am concerned about increasing unemployment among filmmakers, not film producers as such. I am thinking of the cameramen, actors and actresses and all those who are directly concerned with the actualities of film production. There is a great
  1086
  decline in employment among them. We are concerned today, therefore, not only with the sale of a company but with an important economic element in the life of the country.
  If there were an American interest it might be argued that this would provide employment. I would not be against that, if only on the condition that there was no alternative means by which employment could be stimulated from our own resources. The Minister said that the Government are not in the film industry and do not want to be in it and that for that reason they are concerned with selling British Lion, but I believe that the Government ought to be in the film industry.
  Mr. Heath: With great respect, I defined the part which I thought the Government ought to take in the film industry and that was the part agreed by both sides of the House, as exemplified in the N.F.F.C., which makes loans for the production and distribution of films. That is different from being in the company which should do it.
  Mr. Edelman: I said that. The right hon. Gentleman is understandably applying a purely financial test as the preposition in the film industry. I believe that we have to find something more than a purely financial test. I think that there must be something more than a purely financial participation. Just as we have areas of patronage which are highly desirable—the British Council, the Arts Council, and bodies of that kind—so I believe that in the film industry, which is concerned not simply with the medium of entertainment but the medium of culture, the Government should have a much more direct and active interest.
  I would ask the right hon. Gentleman to revert to the statement of Mr. John Davis of what he considers to be the desiderata of film production, and he will see from that that he regards one of them as being culture in the widest sense. If British Lion is to be sold to a purely commercial interest whose standards will simply be the standards of profitability, then indeed I think that the British film industry's concern for the film as an art medium will certainly die. It may linger on; it may indeed form part even of an expanding medium

  1087
  of pure entertainment; but in terms of national culture, in terms of projecting a picture of the nation, I believe that the sale of British Lion to a purely commercial interest will do great damage.
  Mr. Heath: Is the hon. Member suggesting that British Lion is being devoted purely to the purposes of the film as an art medium? I gave the figures and demonstrated very clearly indeed that its performance had been one of profitability in which it had been eminently successful.
  Mr. Edelman: I am not suggesting for a moment that there is anything inconsistent in a film company of any kind being concerned with its medium as an art medium and being concerned with its products as a medium of profitability. I do not think that there is any inevitable inconsistency between the two. There need not be. What I am arguing, and perfectly clearly, is that a company which is primarily, indeed exclusively, concerned with its commercial interest is a company which is exclusively concerned with profitability and cannot be a company which is prepared to tolerate experiment, prepared to tolerate the enterprising young producer who wants to try to produce a new kind of film.
  I do not believe that is so, and even if it were argued that in the past the operations of British Lion have been so restricted as not to have produced work of that kind—which I do not suggest for one moment, but if it were—I still say that looking at the future of the film industry from the accountancy figures which seem so to preoccupy the mind of the right hon. Gentleman, looking towards any possibility of an expanding film industry in which there will be room and opportunity for the young men and women in the film industry to exercise their talents, to experiment, do the sort of work which is certainly not being done in the industry today and which I say the right hon. Gentleman should consider it his duty to encourage—
  Mr. Heath: If the hon. Member keeps on regarding me as dealing with this only on an accountancy basis perhaps
  1088
  he will recollect that British Lion in three years dealt with 11 films and the N.F.F.C. 57 films. I said the N.F.F.C. did it in five years. It was three. Those 11 films of British Lion for the most part were very successful, and it is the N.F.F.C. which has been financing films of the kind which the hon. Gentleman wants to be encouraged which has been making losses.
  Mr. Edelman: I gladly accept what the right hon. Gentleman says, but I do not believe for one moment that it influences my argument, because my argument rests on a twofold basis. I am saying that finance is necessary to encourage the experimental kind of work I have been talking about, but in addition, I believe that direct participation of the Government inside British Lion to ensure that distribution and the showing of the films do take place is of equal importance and of equal validity.
  What is the use of encouraging production of a film with the present monopolistic situation in which there are difficulties and delays in showing films? I asked the right hon. Gentleman a question about this on an earlier occasion and his reply was inevitably vague. As everyone knows, the truth is that Rank and A.B.C. are primarily—perhaps I am using a mild word—concerned as a vertical monopoly in looking after their own films and their own interests. Rank and A.B.C. give the best showing times for their films. They give preferential treatment to their films. Although they are theoretically forbidden—this is why some of the conditions enunciated by the right hon. Gentlmeman are unenforceable—to pencil in dates for future showings on their circuits, there is no doubt that they do so and deny the opportunity of showings to independent producers who are outside the so-called duopoly. If that is the established technique of Rank's, if these pencillings-in are the basis of some of its contractual relations in the exercise of its monopoly, we have to be very careful in scrutinising those to whom British Lion will be sold.
  Mr. W. R. Rees-Davies: That argument cannot be right; surely it is a non sequitur. The whole trouble today is that the present set-up cannot get the showings it wants. How on earth will it assist the problem

  1089
  one way or the other whether the company is sold off to private enterprise or not? Surely, the only way to assist is to sell it to private enterprise and hope that the Government, who would be wholly independent and strengthened by the powers over monopolies that my right hon. Friend the Secretary of State for Industry and Trade will bring in later this year, will have the power to enable the duopoly to give some of the support to the then created independent company. If the hon. Member would apply his mind to this point, we might do something for the future of the industry and not the past.
  Mr. Edelman: The hon. Member is in error. My argument was not a non sequitur. Its whole basis was that if there is a strong Government element in British Lion, Rank and A.B.C., although they have the habit of pencilling these things in, will be much more cautious and wary about doing it because of the presence of the Government interest in British Lion. It is precisely the absence of the Government element which is likely to encourage them.
  The action which the right hon. Gentleman has taken has been done hugger-mugger in a rather hole-in-the corner manner. It has been rushed through with indecent haste. Only belatedly have the conditions suddenly been produced. The whole enterprise is something of which to disapprove, not only because of its content, but because of its form.
  Because of the talent which lies in the young producers, directors, actors and technicians, our film industry potentially has a great future, but the men who are concerned with the financial manipulations and combinations of the industry are throttling it. They are men who are indifferent to whether the industry as such handles cinemas, bingo halls or bowling alleys. They are concerned merely with the test of profitability, but profitability directed not to the film as a medium, not to the constructive energies of those engaged in the industry, but simply to the interests of those who have a financial stake in their company. I believe that they are men of restricted taste, guided by material values, afraid to experiment and indifferent to artistic enterprise. They are men with a limited
  1090
  sense of public responsibility whose test and standard is profitability.
  For these reasons, it is absolutely vital for the future of the British industry that the Government presence in a concern like British Lion, so far from being diminished and weakened as the right hon. Member has done, should be strengthened and reinforced.
  8.45 p.m.
  Mr. Geoffrey Johnson Smith: I wish to be as brief as possible. I cannot agree with a large part of what the hon. Member for Coventry, North (Mr. Edelman) said. I could have understood his strictures if my right hon. Friend the Secretary of State for Industry and Trade had said tonight, "I intend to deliver British Lion to an unscrupulous group of private buccaneers who will produce a few films for the benefit of the duopoly which would be designed purely for profit without any regard for merit". It does not necessarily follow that a film made for profit lacks merit, but, accepting the hon Member's assumption that it does, that is the inevitable result. Hon. Members on this side would happily have gene into the Lobby with the hon. Member if my right hon. Friend had said that; but he has not said that.
  The National Film Finance Corporation will remain in existence and will continue to do a very worth-while job. British Lion, restored to private hands, will have a Government watchdog on it. Let us suppose that he is a sneak, someone who will see that if British Lion gets a lousy, raw deal from A.B.C. or Rank, or both together, will come tripping back to my right hon. Friend's office and tell him. Where is the sanction? If Rank or A.B.C. want to prevent independent producers from showing their films, there is no deliberate sanction which we can impose.
  However, I should have thought that, knowing that there was the Government watchdog on the British Lion private enterprise company, Rank and A.B.C., if they thought of getting up to some nasty tricks, would think again, particularly as they know that my right hon. Friend is a monopoly hunter. He is the Minister who will produce the

  1091
  blueprint, of a package deal, to streamline the Monopolies Commission and the Restrictive Practices Court. I should have thought that it would be very shortsighted of Rank and A.B.C. to behave improperly with British Lion, restored to private enterprise hands. They cannot be that stupid. If they are, my right hon. Friend could introduce legislation which would administer a thick stick very firmly on their financial behinds.
  I am delighted with what my right hon. Friend said tonight. I came in a very suspicious frame of mind. That is perhaps a rather harsh thing to say, because I have a lot of respect for the integrity, intelligence and ability of my right hon. Friend to dissect even the most complicated problems, as he has shown in his handling of the Common Market negotiations. I should have thought that the film industry would hold no terrors for him. However, I say that coming, as I do, from the comparatively calm and peaceful pastures of television.
  I was struck by some of the arguments which the hon. Member for Coventry, North put forward. We hear the most monstrous allegations made about the way that A.B.C. and Rank can carve up the exhibition side of the film industry; that they make it difficult for independent film producers; that there is a series of interlocking agreements with American interests; and that if Rank turns down one film A.B.C. will turn it down, too. These allegations are serious. We know that between them Rank and A.B.C. control 41 per cent. of the cinemas in this country, and they are key cinemas.
  We know that the United States, where a similar situation prevailed, set about trust-busting the film empires—those vertical organisations to which the hon. Member for Coventry, North referred—and that those involved in showing a film had to sever their links with the production-distribution side of the industry.
  Many of us on this side of the House feel very perturbed about the situation in this country. We will be here after the General Election to hold my right hon. Friend to it when it comes to legislation on monopolies because we feel that here
  1092
  at least, from what we have heard and the allegations made, is a prima fade case for a very swift inspection of some of these dubious practices in the hope that we can get some real competition.
  We would like rather stronger assurances from my right hon. Friend that he will investigate this matter speedily. But that is not the end of it. Many of us want to know who is to take over. Obviously, it cannot now be the person who makes the highest bid. My right hon. Friend has made it clear that this will not be an auction. The criteria for the decision will, therefore, be very complicated. If it is not to be an auction, in what way will the National Film Finance Corporation make up its mind as to who is to have British Lion?
  This makes me at least think that a further question must be asked: who is to decide who is to take over? My right hon. Friend says that the Corporation will make a recommendation. I do not want to lay about me too widely, but I think that I can stand here without fear of contradiction when I say that there does not seem to be any independent film producer who has any confidence in the ability of the Corporation to make a very sensible choice in this matter. The independent producers do not think very much of those who run the Corporation. I will not go into personalities, but I am sure that other hon. Members will support me on that.
  Perhaps one might argue that, thank goodness, the final decision will rest on the broad and capable back of my right hon. Friend, but when one recalls that the recommendation he will receive will come from the National Film Finance Corporation I wish that it had earned greater respect in the film industry, particularly among independent producers. I hope that the job of making a recommendation can be taken out of the Corporation's hands. Maybe that is impracticable, but I hope that at least the warning I have uttered, and which will be repeated by other hon. Members, will alert my right hon. Friend so that on this occasion he will be unusually perceptive.
  Who is to take over? We are concerned because of the most complicated interlocking arrangements. Among the names that have been suggested there are people who are hooked up with

  1093
  special television interests, others who are associated with American companies, a nd so forth. It is because we know how complicated this is that we feel that it will take a body which commands the support of the independent producers to enable many of us to accept that a sensible recommendation has been made, based on merits and proper examination.
  Finally, I return to my starting point. Many of us on this side of the House and, as I judge from the silence, many hon. Members opposite were delighted to hear the various conditions which a potential buyer of British Lion will have to accept if he wishes to be given the franchise. They seem to me to be excellent conditions.
  I am convinced that we shall not get to the root of the problem until we bring a breath of fresh competition into the actual circuit arrangements so that films produced under these auspices get as fair a showing as I think they ought to get. Until that is done, many films of quality will not get the sort of showing at, to use a television term, peak viewing time, to which they are undoubtedly entitled.
  Because of this curious sort of smell about the film industry, many people with real talent are discouraged from entering it. There are many people in the television industry today who have left the film industry because, as the years went by, they found that it was an industry which did not put a premium on integrity. They found that the interlocking financial interests created an atmosphere which was detrimental to real talent.
  I hope that before my right hon. Friend finally decides who is to own British Lion he will examine with unusual care the recommendations made to him by the N.F.F.C. If he does not agree to the suggestion that the Council should not be the arbiters my right hon. Friend should show commendable zeal in ensuring that there is a swift examination of the monopolistic practices which many people allege exist in this industry.
  8.57 p.m.
  Mr. Harold Lever: The Minister has told the House that there is no question of subsidy in this industry, and of course if that kind
  1094
  of pretence, or that measure of sincerity, were to be applied to the whole of his speech, it would be a cause for alarm. Everybody knows that since the declaration of no subsidy the industry has been continuously subsidised, and that is the purpose of the N.F.F.C. The Council has been lending public money not under commercial considerations, but without any desire to make a profit, and without even managing to safeguard its capital, still less produce an income from it.
  The Council has undoubtedly acted to provide some form of subsidy for the British film industry. I deplore it as a permanent state of affairs. I think that the remedy is for the film industry not to be pauperised in this way, but that conditions should be created by the Government which make possible an industry which can be viable without this specific subsidy. It may be that when my right hon. Friend the Leader of the Opposition brought it in as an emergency measure in these terms he stated specifically that it was not intended to produce a permanent subsidy of the industry but to buy time to give the Government the opportunity of creating better conditions for film production in this industry. Time was bought, but no use was made of it, and now the Minister has the courage to tell the House that nobody is subsidising the film industry. It will be interesting to see how long the position of non-subsidy is maintained, and how long it is before the Government come back for more money.
  As regards British Lion, the Minister has told us that it was never contemplated that there could be a sale without the sale coming to him for approval, but the heart of the matter is at what point does the deal come to him for approval? Is it to come to him for approval alter Mr. Terry has committed the N.F.F.C. and is bound in honour and decency to go on with the deal, or is he to come to him for approval while he is still a free agent, neither morally nor legally committed to any particular personal group?
  What is widely supposed is that the N.F.F.C. is already morally committed to Mr. Box and we are going to see something in the nature of a charade to

  1095
  satisfy many hon. Members who have taken a sincere interest in the matter—not exclusively Members from this side of the House, but many from the benches opposite. I hope that the Minister will pledge his honour that there no such commitment is in the mind of the Government or of the National Film Finance Corporation. This is not an eccentric supposition on my part. As has been pointed out by the hon. Member for Orpington (Mr. Lubbock), this declaration of the position was given publicly by Mr. Terry, of the N.F.F.C. Therefore, it must be repudiated in express terms, and terms of utter sincerity.
  I shall not go into the question raised by the hon. Member for Coventry, North (Mr. Edelman) about artistic merits. We are not talking about the minority cultural aspects of films. This company is concerned with mass audiences, which necessarily and inevitably, in all countries, are mainly concerned with entertainment. The minority artistic film about which my hon. Friend is talking is irrelevant to the issue that we are discussing tonight, although I share many of the views that he has expressed.
  He may take consolation in the fact that nearly all the films of great artistic merit have been made by hard-faced gentlemen of a philistine character, and various individuals who very often managed to employ members of the Communist Party and nuclear disarmers to propagate extraordinary and interesting opinions among a wide sector of the public. It is not necessarily a good formula for artistic success to take a philistine and put him in charge of one's operations, but so far all the great classics of the screen have been made precisely under such auspices. My hon. Friend need not mutter in despair on the question of who will own British Lion in the immediate future.
  I do not wish to comment upon individuals, but I wish that the Boulting Brothers had not missed the unique opportunity that was afforded to them when making "I'm all right, Jack"—when they caricatured so effectively and amusingly the trade union side—of incorporating in their script the happenings in the life of British Lion itself, in order to give an air of verisimilitude
  1096
  to the "boss" side of the picture, which I thought was the weak side of it.
  Mrs. White: They have a wonderful opportunity to make a film about the Board of Trade, which would make "Carlton Browne of the F.O" pale into insignificance.
  Mr. Lever: I agree, but what everyone now wants to see is public property not being handled in the manner that private property necessarily would be. It is a delicate question, because if we say that we shall not sell property that belongs to the Government to the highest bidder it means that we are giving something away at less than its market value to a private group. It is a very delicate question.
  Mr. Lubbock: The President of the Board of Trade has said that there would not be an auction, and that the price would be the same whoever bought it.
  Mr. Lever: Having established the principle of not trying to secure the maximum price, it then behoves the right hon. Gentleman to see that the public gets much better value. We would prefer that British Lion remained wholly owned by the Government. We cannot really expect a Conservative Government wholeheartedly to adopt all our principles, so I act on the assumption that the Government will sell. But we expect that if they do they will be at great pains to ensure that they bring into being—if necessary by negotiation—a group of people which represents all that is most constructive in British film production, so that British Lion Films Limited will continue to be an organisation which will support, guide, finance and distribute films, possibly mainly of an entertainment character and possibly mainly with a view to their being financially viable, but still continuing to be an essential and independent force in British film production, of great value to all those who are honestly and creatively concerned with making films in this country.
  It would be a disaster if the Minister were to fall short in any way of this requirement, and I hope that we shall have an explicit and sincere assurance that there will be no rigged deal and

  1097
  no foregone conclusion, but that the matter is still open for genuine free negotiation.
  9.5 p.m.
  Captain L. P. S. Orr: I entirely agree with what has been said by the hon. Member for Manchester, Cheetham (Mr. H. Lever) and I will return to it in a moment.
  The great concern of many people about the sale of British Lion is whether we are enacting a charade, whether the Government are morally bound to someone or not. I think that this state of uncertainty has resulted from the extraordinary way in which the National Film Finance Corporation has handled the whole affair. I am sorry for my right hon. Friend having been landed with this problem in the form in which he found it.
  The background of this—I do not wish to labour all the points which have been made—is, of course, the question of monopoly, which is taken for granted by hon. Members. My right hon. Friend said that the question was not one of whether a monopoly exists, but whether an abuse of monopoly exists. The opinion is widely held among independent producers that there are abuses of a monopoly, and I should have thought that the hon. Lady the Member for Flint, East (Mrs. White), with her experience on the Cinematograph Films Council, would know enough to be able to say that an abuse does exist.
  I should have thought it a sufficient abuse of monopoly power that there should be restrictive agreements between the two combines, so that, in effect, the future showing of any British film is decided by two men. If that is not abuse of a monopoly, I do not know what is.
  The reason we are so concerned about the future of British Lion is, as the hon. Lady pointed out, that British Lion was the last independent distributor left. British Lion was unique in that it was the only one able to break the restrictive agreement between the two combines. It was the only producer able to do any bargaining between the two. Our fear has been that if the Government money is withdrawn from British Lion without there being proper safeguards, British Lion, while it might nominally retain its independence, would certainly not retain
  1098
  its robust, aggressive nature and its determination to compete, and force the two combines to compete, even to a limited extent, with each other. This is the rôle which we think that British Lion ought to play in the industry. If it abandoned that rôle it would ultimately tend to drift into the aura of one or other of the two circuits. This is the basis of the whole of our concern.
  I am one who thought that the Government should retain some holding in British Lion. In my opinion, it would be wrong to sell the entire company to anyone outside. The right sort of situation—I still think that probably it would have been a better solution than that of my right hon. Friend—would have been to retain, say, a 50 per cent. holding in the company and to have offered the rest back to the present five directors, on the general understanding that they would bring in with them other independent producers; that they would broaden their board and make themselves more representative of the independent British producers. I should have thought that the better solution.
  None the less, I think that my right hon. Friend has made a genuine and ingenious attempt to retain some control over the future of British Lion. I think that what he has done is on the whole good. I gave some thought to how a single director appointed by the Government to N.F.F.C. could have any possible power and I must say I did not think of this one. I think it is ingenious. I only hope that it will work.
  Whether or not one can put in more veto power than is already there I should like to examine, but it still seems possible even now, in spite of the powers given to this single director, that British Lion, if the wrong choice is made in ownership, might lose its robust, independent quality and tend to get into the aura of one or other of the combines. I hope that when the director is appointed he will be someone in whom the independent producers have confidence. He should not be simply someone appointed by the present management of the N.F.F.C. in whom, as my right hon. Friend rightly pointed out, it is very difficult to find any independent producer who has any confidence at all.
  I should like to underline what my right hon. Friend said about the N.F.F.C.,

  1099
  because it is extremely important. He has to rely upon the present management of the Corporation for his advice. Perhaps a few quotations from the chairman and managing director of the Corporation without any comment from me will simply illustrate why the independent producers do not have any confidence in the present Corporation. For example, on 20th December Mr. John Terry is reported in the Daily Cinema as stating that the five directors are no longer shareholders although they will still manage the company. On 23rd December, in the Daily Cinema, Mr. Terry is quoted as saying that the N.F.F.C. owns and controls British Lion, but that in future it might release it into private hands if suitable purchasers could be found.
  That is for the future. At present, there is no intention to make any changes. Perhaps Mr. Terry was misquoted by the newspaper. If so, I beg his pardon, but I have taken care to check the reference. Mr. Terry said:
  "We have not asked for resignations."
  In The Times of 31st December Mr Terry was quoted as saying:
  "Negotiations with Mr. Box are well advanced."
  It is very difficult to reconcile what Mr. Terry said then with what my right hon. Friend said this afternoon. If I am asked to choose between one and the other, I prefer my right hon. Friend every time, but that surely underlines why it is difficult to have confidence in Mr. Terry.
  On 31st December the chairman said that Ministerial approval for the sale had been given some time ago. It was not clear whether he meant the sale to Mr. Sydney Box, the opening of negotiations with him or of the company being sold. We come to Sir Nutcombe Hume. On 1st January, he said:
  "We feel that of any available purchasers Mr. Box is probably one of the best."
  It is very difficult to ask my right hon. Friend to comment on that, but can he imagine that Mr. John Terry is able to make an unbiased judgment in giving him advice after that has been said? I shall not quote from The Times about strong indications that the sale of British Lion to Mr. Sydney Box was an accomplished fact, but perhaps I may
  1100
  give one more illustration to show why it is difficult to have confidence in the present N.F.S.C.
  On 2nd January, Sir Nutcombe Hume stated that a few weeks ago he had not even heard of Mr. Box and there was no reason in the world why he or anyone else should be favoured. Yet, as hon. Members who follow the affairs of the film industry know, the minutes of evidence taken before the Public Accounts Committee on 20th May, 1958, show that Sir Nutcombe Hume mentioned Mr. Sydney Box by name. He was asked a question about the people who purchased this company and whether they were making a success of it. He replied: "That is Sydney Box." As far back as 1958 is a considerably longer time than "a few weeks ago".
  I have countless quotations which could be produced to show the extraordinary state of muddle and equivocation which has been produced on the part of the N.F.F.C. and which illustrate why everyone in the industry whom I can find has lost confidence in the present management. Consequently, I say to my right hon. Friend that the important thing in this matter is that he should make up his own mind at an early stage. Having laid down his criteria—and I have no quarrel with the criteria—I think that the principal criterion is that those who are chosen to be the new owners of British Lion should command the respect and confidence of the independent British producers. That overrides all else.
  The Federation of British Film Makers has put its views to my right hon. Friend, and has given him certain criteria by which he could judge whether or not persons had that confidence. The conditions have only been published today, and all I would ask of my right hon. Friend is that there should be sufficient time to allow applicants to get their forces together. It would be derisory, for example, to seek to come to a decision in a fortnight. Mr. Sidney Box may have known a great deal in advance of others—we do not know—but others have since come into the field. We have the conditions of sale only today and, if we are to be fair to everyone, rather more than a fortnight is needed. I think that a month would be fair.
  That having been done, I would ask my right hon. Friend to avoid being put

  1101
  in the position of having, as it were, to rubber stamp a recommendation given to him. The decision should be matte genuinely by himself. He should not get into a position when the deed would be practically tied up, the N.F.F.C. morally bound to someone, and my right hon. Friend then having to turn it down.
  The future of the industry is very greatly bound up with this particular independent distributor. It is the last one left and, if it goes, or loses its quality and its present determination and competitive spirit, it will be a bad day for the industry, and the industry would rue it in the long run.
  9.20 p.m.
  Mr. Eric Lubbock: I agree with the final statement of the hon. and gallant Member for Down, South (Captain Orr) and with his wish to preserve the robust independence of British Lion. That has been the one concern of this House all along, and it has cut right across the discussion of the doctrinaire reasons for the Government's wish to dispose of their holding in British Lion and the wish of those on this side that they should retain it. At one time, it seemed that the independence would not be preserved, but the conditions given by the right hon. Gentleman the Secretary of State for Industry and Trade this evening have been welcomed on all sides as a step towards safeguarding the independence of British Lion. We should all like some little time to examine those conditions in detail before commenting on them.
  I welcome the appointment of a director to the board of British Lion. It is very important that we should know who he is likely to be, because the appointment will not be made by the President of the Board of Trade but by the board of the National Film Finance Corporation and the nominee on the board of British Lion might well be Mr. John Terry, of whom we have heard so much this evening.
  The special share that the N.F.F.C. will hold will give the Corporation the right to veto certain decisions of the board of British Lion and will meet certain eventualities that might arise, but will these rights be written into the articles of British Lion? If the N.F.F.C. holds only this one share, what is to stop
  1102
  the board of British Lion later altering its articles so as to remove these safeguards? We should be grateful for an answer to these points.
  Without going back to the first reel, so to speak, I want to set right one or two matters of the history of the affair which I do not think have been properly explored. In his statement on 16th January, the right hon. Gentleman said that Mr. Box's first approach to the N.F.F.C. was on 20th September, 1963, and it was not until 29th November that Mr. Kingsley, the managing director of British Lion, was told that after the first option had been exercised by the N.F.F.C. it was the intention to sell off British Lion to a suitable purchaser, subject to the right hon. Gentleman's agreement.
  The British Lion directors did not believe that the right hon. Gentleman would consent to this sale, in spite of the officially announced Government policy to that effect. They had two very good reasons for not believing it, which were explained by the Boultings in an article which they wrote in the Spectator on 10th January. First of all, the right hon. Gentleman's predecessor, the present Chancellor of the Exchequer, had vetoed a similar attempt in, I think, late 1960. Secondly, the company was now earning very substantial profits, and was paying dividends on the 50 per cent. of the equity owned by the Corporation.
  The discussion of the option arrangements is a rather important point. In his staemen on 16th January, the right hon. Gentleman said that the Corporation had informed him that it was
  "… left in no doubt … that Mr. Kingsley and his colleagues would neither exercise their second option to buy the Company nor continue the option arrangements on the same basis for a further period".—[OFFICIAL REPORT, 16th January, 1964; Vol. 687, c. 424.]
  All the time in their minds was the original option arrangement, no doubt, but this was never adhered to because, as the right hon. Gentleman well knows, the two weeks which they were finally offered was not the period provided for in the agreement. So what the right hon. Gentleman said was not strictly true, because the situation in which the Government having become the 100 per cent. holder of the equity, would decide to sell it off to some private interests was never put to Mr. Kingsley and his colleagues till late in November.

  1103
  They were very surprised to learn on 13th December that the Government had given permission for the sale of British Lion and that they were offered an option then to buy it themselves within two weeks. It could not possibly have been intended that this offer should be taken seriously at all.
  I remind the House that all these negotiations had been taking place behind closed doors, in spite of what is now generally recognised to have been their crucial importance for the whole British film industry. This is the way—one must say it—the party opposite likes to do things. It is the same with the nuclear power industry or the recent upheavals in B.O.A.C. Everything must be done behind closed doors, the idea being to tell the public and the House as little as one can possibly get away with, even though substantial sums of Government money are involved.
  Fortunately, in this case, the directors of British Lion refused to be good boys and keep quiet. They insisted that a statement be issued, and this statement happened to come the day before the Adjournment debate initiated by the hon. Lady the Member for Flint, East (Mrs. White) just before Christmas. I can confirm what the hon. Lady said. If it had not been for that debate and the statement the directors insisted on being issued the previous evening, we should never have known anything about all this. By now, British Lion would have been safely in the hands of Mr. Sydney Box and his anonymous syndicate, who, in their turn, would have been busily engaged in drafting agreements with Rank and A.B.C. in order to remove all competition from the British film industry.
  Mr. Heath indicated dissent.
  Mr. Lubbock: The right hon. Gentleman shakes his head. Has he read what was said in the Observer of 5th January:
  "Box's plan is to approach the moguls of the Rank and A.B.C. circuits with script, stars and budget all tied up, seeking a tentative date for showing".
  The next bit is in quotation marks, coming from Mr. Box himself:
  "'If I have ten films a year, I should like to give five to one and five to the other'"
  What kind of competition is that?
  1104
  Of course, no one would have known anything about these negotiations. No one would have been able to demand the assurances which were given by the Parliamentary Secretary in the debate on 20th December, repeated in the hon. Gentleman's statement on 16th January, and now expanded this evening.
  There is no doubt whatever in my mind that this whole deal would have been pushed through during the Christmas Recess and we should have been presented with a fait accompli on our return. The right hon. Gentleman may smile at that, but Mr. Box himself gave the game away when he told the Daily Herald on 3rd January:
  "My accountants have been viewing the books since Tuesday, and if everything is O.K. by Monday, I will put the money down".
  He thought that the whole thing would go through and that Parliament had nothing more to say. So did Mr. Terry, according to the quotation which I have already read to the House—
  "The situation at present is that we have made an offer to Mr. Sydney Box's group and, unless and until these negotiations fail, we are not offering the business elsewhere."
  Mr. Terry and Mr. Box were at one in thinking that the whole thing was a fait accompli.
  It is quite shocking that an attempt should have been made to push through this deal behind our backs, in a matter of such grave public importance. It was also bad business. This must have become obvious by now. There was only one contender in the field at one time. The right hon. Gentleman said that it appeared that there was only one satisfactory bidder, whereas now there are no less than seven. According to the right hon. Gentleman in his statement on 16th January, the Government claim that they attach
  "the greatest weight to the ability of the purchasing group to provide the necessary financial strength and skill in management and to maintain its independence".—[OFFICIAL REPORT, 16th January, 1964; Vol. 687, c. 418.]
  If nobody had been told of the Government's intention to dispose of their 100 per cent. holding in British Lion, after acquiring the 50 per cent. holding of the directors, how could there have been any competition in the bidding and how could these factors which the right hon. Gentleman mentioned have been brought into the matter at all?

  1105
  It has been said that Mr. Box came forward and offered to negotiate as early as September and that none of the other seven groups did so, although they would have been free to make an offer similar to that of Mr. Box to negotiate with the National Film Finance Corporation. That ignores the fact that if anybody had got as far as reading the option agreement he would certainly have been led to think that the Government would take only 100 per cent. control as a matter of deliberate policy to extend their holding permanently. That certainly was the impression given to the five directors when the agreement was signed. That was why the Government wanted the first option clause to be included in the contract.
  If the Government had not decided to exercise their first option, there would have been a period of six months within which the directors could have tried to raise the finance for them, in turn, to buy out the Government's 50 per cent. holding. The other six contenders certainly would not have approached the Corporation in September, because they would have imagined that there would be at least another nine months before the situation came to a head. It is probable that the initiative did not come from Mr. Box in September and that this is the explanation why there was only one contender.
  It is natural to suppose that someone who was privy to the intentions of the National Film Finance Corporation put Mr. Box up to making his approach over a lunch-table some time in September. If that is true, it is no wonder that Mr. Box appeared to be the only suitable purchaser until a public announcement was made, when the number rapidly rose to eight, since when it has fallen back to seven. This proves that it' the Government had been determined to bear these factors in mind in returning British Lion to private ownership, the right course would have been for them to make a public announcement to that effect, listing the qualifications which an applicant would be expected to have, which the right hon. Gentleman mentioned on 16th January, and then inviting bidders to come forward.
  As long as there is this monopolistic structure in the industry, it would be
  1106
  a good thing for the Government to maintain a large holding in British Lion. It was a pity that the promised legislation to deal with a monopoly in the film industry did not come before the proposed sale. I am glad to have at least the partial consolation of knowing the important powers which are to be attached to the one share which the right hon. Gentleman mentioned. We know, however, that for doctrinaire reasons it has been decided to pull out. Our task is at least to try to safeguard the future independence of British Lion. The viability and independence of the company depends ultimately upon its falling into the right hands.
  I wish for two minutes to consider the contenders. First, there is the Box group, none of the members of which have been announced, apart from Lord Willis, who must be something of an embarrassment to the Opposition. [HON. MEMBERS: "Why?"] No sooner had he been translated from Dock Green to the House of Lords than he bit the hand that put the coronet on his head. The coyness of Mr. Box in revealing the other members of his group results from the fact that he has no associates other than his own family, and all his family are under contract to one or other of the big combines. It would, therefore, be embarrassing for him to have to reveal this.
  If one considered Mr. Box by himself, one would not feel at all happy about entrusting British Lion's future to him. He was at one time in charge of Rank film production for four years and at the end of it the studios were closed, hundreds of people were thrown out of work and a good deal of money was lost. Therefore, in considering the financial strength and the technical expertise which these groups bring to bear, I hope that the right hon. Gentleman will take that point into account. Then there is the John Woolf-Sam Spiegel-Leslie Grade group. Sam Spiegel is a substantial shareholder in Columbia Pictures, an American company with an exclusive trading agreement with the Rank Organisation.
  Leslie Grade and his brother operated Elstree Film Distributors which has an exclusive agreement with the A.B.C. circuit. It does not appear, therefore, that this group would remain generally

  1107
  independent of the Rank-A.B.C. axis any more than the Box group would do. Finally, there is the Michael Balcon group. It must be generally agreed that this is the most talented. It includes John Osborne and Tony Richardson who made films like Tom Jones and "Saturday Night and Sunday Morning" and it includes people who can be trusted to keep to the spirit as well as the letter of any undertakings they give.
  If the Government have absolutely made up their mind that their holding in British Lion should be sold, it should be to these people rather than to Sydney Box and Sam Spiegel. I have dealt only with the serious contenders. I do not think that the other four could be considered as such. Whatever the decision may be, this crisis is only an episode in the long and sorry history of the Government's refusal to deal with this problem of monopoly in the film indstry. We can account for this tenderness towards the Rank-A.B.C. octopus only by reminding ourselves that the Tory Party is the party of big business and it does not really believe in the competition to which sometimes it pays lip-service.
  Mr. Wilfred Proudfoot: Surely the hon. Member heard the speech of my right hon. Friend. This is an exact reversal of what he said.
  Mr. Lubbock: Not at all. The right hon. Gentleman did not demonstrate in his speech that the one share which the Government will hold in British Lion will ensure future competition within the industry. It is true that we have been promised legislation later this year. It has not yet appeared and it should have preceded any decision to dispose of the Government's shareholding indirectly in British Lion through the N.F.F.C.
  The decline in cinema audiences continues in Britain because here the fate of a film is settled not by the public but by a few bookers of the two circuits who sit in private viewing theatres before the film reaches the public. It is common knowledge that the film "Tom Jones," which has been an outstanding success at the box office, was turned down by the bookers when first shown
  1108
  to them. Apparently the same applies to "Dr. Strangelove" which last week had outstandingly enthusiastic reviews. Not only is the method of selecting the films to be shown unlikely to pick on those which will have the greatest appeal to the public, but the rigidity of the booking system is well calculated to drive audiences away from the cinemas. Nothing that we have heard tonight will do anything to cope with this situation. Unless the Government act quickly to break up the Rank and A.B.C. empires there is a great danger that the film industry in this country will expire.
  9.38 p.m.
  Dame Patricia Hornsby-Smith: In the few minutes left before the Government reply, I should like to say that many of my hon. Friends take an entirely different view about my right hon. Friend's plans and determination to sell the Government interest in British Lion. We support what he has set out to do. We welcome his assurance that it is the intention to keep it British-controlled and also to keep it independent.
  It is not perhaps without significance that during the whole of the debate, until we heard the speech of the hon. Member for Orpington (Mr. Lubbock), only one name of an individual director of the various groups has been put forward. I had no views on this matter until I came here tonight, but I noticed throughout the debate that among those who do not want to see the holding sold, or are determined to give it to those self-confessed reluctant buyers the Boultings, there has obviously been a persistent policy of denigration of Mr. Sydney Box in nine out of ten speeches.
  I am not associated with any of these organisations in any shape or form, but so far as I can see, and from reading the newspapers, it seems to me that here is a gentleman who had the initiative, knowing it was the Government's intention to sell, to put in an offer, and to go to the N.F.F.C. and say he would negotiate. The hon. Gentleman the Member for Orpington, my colleague—I had better say, my political neighbour, rather than my colleague—complained bitterly that the terms offered and the negotiations were not immediately made public. Well, did

  1109
  anyone ever go out to buy a business and tell all his business competitors what the offer was?
  Sir Cyril Osborne: That is how the Liberals work.
  Mr. Lubbock rose—
  Dame Patricia Hornsby-Smith: With great respect, I cannot give way.
  Mr. Lubbock rose—
  Mr. Speaker: Order.
  Dame Patricia Hornsby-Smith: The hon. Member had a fair innings and beat me into the debate, and I promised to sit down soon, because there are two speakers to wind up the debate.
  If the hon. Member had studied some of the publications as well as I have he would have known that, quite apart from Mr. Box and apart from Lord Willis, there is Lord Archibald, with a long and distinguished career in the film industry, on the proposed board. Then there is the son of a very old, one-time friend of mine, whose early career was in the film industry, the late Colonel Bromhead; his son, Michael Bromhead, is also one of the directors. They are all people with long and distinguished careers in the film industry.
  We have heard so much denigration centred so specifically upon one person tonight. Although I did not intend to mention anyone, I think it only fair that someone ought to get up and say that Mr. Sydney Box has had a long and distinguished career in the film industry and great experience of it.
  It is now up to my right hon. Friend, who has shown his mind quite plainly from the undertaking he has given tonight. There were times when speakers opposite seemed to me not to have listened to any of the statements my right hon. Friend has made on this matter, but my right hon. Friend has shown that he is determined to keep this organisation independent.
  My hon. and gallant Friend the Member for Down, South (Captain Orr) said something about these tame people on the various boards. One can mention people of the Wolfson type and of the Spiegel type and of the John Bloom
  1110
  type. One can call these gentlemen many things, but no one could call them tame.
  What is important, I am sure, to all of us in this House is what my right hon. Friend has said about the intentions. I only got four of them down, because of the speed at which he spoke, but he said that there should be no voluntary liquidation, no sale of the controlling holding without the Government being able to prevent its going to a monopoly; and while I am not going into the details as accurately as he did, he also outlined that there would be an assurance—and I think that this is tremendously important—that there would be no sale of the area or the space at Shepperton. I think that this is extremely important to the industry and something which will be welcomed by people who hold particularly strong ideas about this, because they are extremely concerned that those employed in the industry and using the studios should be encouraged to the greatest possible extent.
  I do not believe that any of the groups has any lack of money, and so I think that this boils down to the question: who is capable of doing the job? This is an experienced team of directors, and they are all experienced in films, and they are prepared to guarantee independence, and they will give a stronger and even more powerful future to British Lion.
  9.45 p.m.
  Mr. Douglas Jay: The Secretary of State is rather difficult to understand these days. When it comes to the retail trade he is a convert to the most ruthless competition, without restraint and regardless of consequences. But when we come to the film industry, where we are really faced with a near monopoly, he is extremely timid, and tiptoes cautiously this way and that under pressure from public opinion.
  The right hon. Gentleman, thanks to the vigilance of the House, and to my hon. Friend the Member for Flint, East (Mrs. White) in particular, has certainly moved a good distance since 20th December. We are now to have a special single shareholding, a Government director and a number of assurances. I can only tell the right hon.

  1111
  Gentleman that if he expects us to believe that that was the Government's policy on 20th December, his Parliamentary Secretary was grossly misleading the House that day.
  I even asked the Parliamentary Secretary straight that day whether he would give an assurance that these shares would not be sold to Rank or A.B.C., but he refused to give even that assurance. Therefore, I do not believe that he was misleading us. I believe that the Secretary of State has very extensively altered his policy.
  We are now to have, if I understand the right hon. Gentleman aright, a special single share, owned by the N.F.F.C., retained in British Lion, and I also understand from him that there will be a condition attached to that by which—I am not sure whether I am right, and this is important—neither the shares nor the assets of the company, in effect, can be sold by the new owners without the consent of not just the N.F.F.C., I hope, but of the Board of Trade. Can the right hon. Gentleman confirm that that is true?
  There is to be one Government director. We should also like to know for certain—we have not yet had it made clear—that the director will be selected and approved not just by the N.F.F.C., but by the right hon. Gentleman and the Board of Trade as well. That would take us some way.
  I must say that if the right hon. Gentleman admits, in effect, the case for some Government control and in the last resort a veto on future sales and activities of the company and, therefore, the need for an independent force in the industry, why does he refuse to go the whole way and retain the present Government ownership of the shares? After all, it is the universal view—not just of us here, but of almost every school of thought in the industry—that as a pure matter of fact it is likely to be easier for British Lion to stand up as an independent third force, or whatever it is called, in the industry separate from the two circuits, both for production and distribution, if there is substantial public ownership in it.
  That is not our view; it is a question of fact. That view is held not merely by the unions, but by a whole number of
  1112
  associations in the industry. Indeed, if one puts it as a point of fact even to the leaders of the two circuits themselves they admit that they would be less likely, if they had any inclination, to bully or try to cabin and confine British Lion if the Government stood behind it.
  If that is the case, if that is the opinion in the industry as a matter of fact, and the right hon. Gentleman is contesting that, he is putting his own opinion—his familiarity with the industry so far is fairly slight—against all those interested in the industry. But if that opinion is right and if the right hon. Gentleman really has the objective of maintaining British Lion as an independent force, what are his reasons for wanting to sell the other shares at all? I do not believe that he has made out any case on this point, except the original doctrinaire intention of the Government to get rid of public ownership of the shares regardless of the effects and consequences.
  I think that, having come this way and admitted the substance of the argument, the right hon. Gentleman might have had the courage this time to put his doctrinaire ideas beside him and accept what is obviously the best solution. Unless he is prepared to do that, we still cannot accept the remedy which he is putting before the House tonight.
  9.50 p.m.
  Mr. Heath: In this last remark the right hon. Member for Battersea, North (Mr. Jay) has indicated quite clearly that he is actuated by doctrinaire considerations. He is not prepared to consider the proposals which I have put before the House on their merits, but is merely wiping them aside and dividing the House on the continued public ownership of the British Lion Company. That is the sole issue on which he is dividing the House, and not on the part which the Government play in helping the film industry.
  The right hon. Member said that if we are to have this measure of control, if one likes to use that word, why should we not keep the whole of British Lion in public hands and publicly financed? The answer is: because we believe, as I have said, that, in this developing situation in which there are still very considerable opportunities for a company

  1113
  of this kind and for the film industry, it is right that private enterprise and initiative should be used within the context of the firm being retained as a third force in the British film industry and to support British independent production and distribution. We therefore have the framework in which it can operate and we would leave the rest of the intiative and enterprise of the group which will secure the company as a result of the proposals which I have outlined. That is a very strong and firm reason why this arrangement should be made and one which we have put before the House tonight.
  I have been asked a number of questions which which I should like to deal, but, first. I wish to deal with the point of the right hon. Member for Battersea, North that this is a sudden conversion. My hon. Friend the Parliamentary Secretary said in the Adjournment debate on 20th December that the purchaser would give an assurance about the facilities which the company now makes available, and so on, and that this was at that time a condition of sale. What I have outlined today are the specific arrangements for that condition of sale. That is what has been worked out in the past weeks since my hon. Friend spoke in the Adjournment debate. He made it clear at the beginning that this was a condition of sale and that British Lion should remain a third force in the interests of the independent producers.
  Therefore, this miasma of suspicion and innuendo which has been created by the hon. Member for Orpington (Mr. Lubbock) in his speech about the way in which this matter has been handled is untrue, and demonstrably untrue from what my hon. Friend said during the Adjournment debate. He does not help his friends in the film industry or the film industry itself by making speeches of that kind.
  The hon. Member for Manchester, Cheetham (Mr. H. Lever) asked me to say quite clearly that there was no commitment to any would-be purchaser of British Lion. I can say that categorically to the House. For my part, there is no commitment on behalf of the Government and I understand that there is no commitment on behalf of the N.F.F.C. This can be illustrated by the fact that Mr. Box has not yet made any
  1114
  formal offer to the N.F.F.C. for the British Lion Company. I therefore hope that the hon. Member will accept that there is no commitment to any particular group concerning this sale.
  Mr. Rees-Davies: Will my right hon. Friend or the N.F.F.C. be the decisive factor? Secondly, what are the criteria of choice which will be uppermost as the matters of principle affecting his judgment?
  Mr. Heath: I think that I described that specifically and clearly in my opening speech. However, the Corporation must judge on the character of the group in carrying out the policy for which it will give an assurance and also on the financial resources of the group not only for the purchase but for the operation of the company in accordance with the assurance which it has given. Those seem to me to be very clear criteria by which the judgment must be made about which would best operate the company in the way that we want it to be operated.
  The hon. Member for Coventry, North (Mr. Edelman) said that he was quite convinced that there were concealed assets. What happened was that there was an independent valuation by an accountant of the greatest integrity which was accepted by the N.F.F.C. and by the five directors of British Lion, and on that decision rested the valuation of their own holding in the company. I do not see how one can do better than to have an independent valuation of all the resource; which is accepted by both the N.F.F.C. for its holding and by the five directors for their holding. So I hope that the hon. Gentleman will not pursue this matter further in suggesting that there are some hidden assets which either the Corporation, or the five directors or the Government are trying to write off.
  The hon. Member for Orpington asked about special shares and how they could be maintained. The special shares will be a whole issue of a class of shares and therefore unable to be withdrawn without the owners' consent. That position will be safeguarded in the articles from the point of view of the future of British Lion.
  A number of questions concerned the monopoly situation in the industry. I

  1115
  give an assurance that we will come to the speediest consideration of the report of the Films Council when it is received. But, of course, we must have an opportunity to examine it carefully and consider the points made by the hon. Lady the Member for Flint, East (Mrs. White) and other hon. Members.
  It is perfectly true that many of these problems, if they can be substantiated, arise from the fact of the two great operators in the industry and not from the question of the ownership of British Lion. The problems are there whether British Lion is partly or wholly owned by the Government or entirely owned by private enterprise. What is at issue is the question of whether, when it is owned by private enterprise, it can remain an independent force. That is what we have been discussing tonight and we have given an assurance that it will remain an independent force.
  Mr. Jay: Is it clear that these shares will not be disposed of without the permission of the Board of Trade?
  Mr. Heath: I gave a specific assurance that there will be a right of veto on the disposal of the undertaking, and this, of course, will be in the hands of the directors of the Corporation. Ob-
  the Corporation reports to the Board of Trade. The right hon. Gentleman knows that arrangement.
  The question of artistic merit of British films was raised. Of course I have been fully concerned about the artistic achievements of the industry. Many of those who came to see me discussed this in detail together with methods of maintaining the integrity of the industry. I believe that it is of vital importance.
  Most hon. Members who know me also know that I have certain specific interests in the arts, music and painting. I have personally great concern and consideration for the artistic aspect of British films and for those who work in the industry. That is why we are so anxious that they should be helped through the Corporation and the maintenance of British Lion as an independent force. I believe that what we propose is the best way of helping them and I hope that the House will accept that we are acting in the best interests of the industry as a whole.
  Question put, That this House do now adjourn:—
  The House divided: Ayes 241, Noes 301.

  Division No. 19.]

  AYES

  [9.58 p.m.

  Abse, Leo

  Castle, Mrs. Barbara

  Foot, Dingle (Ipswich)

  Ainsley, William

  Chapman, Donald

  Forman, J. C.

  Albu, Austen

  Cliffe, Michael

  Fraser, Thomas (Hamilton)

  Allaun, Frank (Salford, E.)

  Collick, Percy

  Galpern, Sir Myer

  Allen, Scholefield (Crewe)

  Corbet, Mrs. Freda

  George, Lady Megan Lloyd (Crmrthn)

  Awbery, Stan (Bristol, Central)

  Craddock, George (Bradford, S.)

  Ginsburg, David

  Bacon, Miss Alice

  Cronin, John

  Gourlay, Harry

  Baird, John

  Crosland, Anthony

  Greenwood, Anthony

  Barnett, Guy

  Crossman, R. H. S.

  Grey, Charles

  Baxter, William (Stirlingshire, W.)

  Dalyell, Tam

  Griffiths, David (Rother Valley)

  Beaney, Alan

  Darling, George

  Griffiths, Rt. Hon. James (Llanelly)

  Bellenger, Rt. Hon. F. J.

  Davies, G. Elfed (Rhondda, E.)

  Griffiths, W. (Exchange)

  Bence, Cyril

  Davies Harold (Leek)

  Grimond, Rt. Hon. J.

  Benn, Anthony Wedgwood

  Davies, Ifor (Gower)

  Gunter, Ray

  Bennett, J. (Glasgow, Bridgeton)

  Davies, S. O. (Merthyr)

  Hale, Leslie (Oldham, W.)

  Benson, Sir George

  Deer, George

  Hamilton, William (West Fife)

  Blackburn, F.

  Delargy, Hugh

  Hannan, William

  Blyton, William

  Diamond, John

  Harper, Joseph

  Boardman, H.

  Dodds, Norman

  Hart, Mrs. Judith

  Bottomley, Rt. Hon. A. G.

  Doig, Peter

  Hayman, F. H.

  Bowden, Rt. Hn. H. W. (Leics, S. W.)

  Driberg, Tom

  Healey, Denis

  Bowen, Roderic (Cardigan)

  Duffy, A. E. P. (Colne Valley)

  Henderson, Rt. Hn. Arthur (Rwly Regis)

  Boyden, James

  Ede, Rt. Hon. C.

  Herbison, Miss Margaret

  Braddock, Mrs. E. M.

  Edelman, Maurice

  Hill, J. (Midlothian)

  Bradley, Tom

  Edwards, Rt. Hon. Ness (Caerphilly)

  Hilton, A. V.

  Bray, Dr. Jeremy

  Edwards, Robert (Bilston)

  Holman, Percy

  Broughton, Dr. A. D. D.

  Edwards, Walter (Stepney)

  Houghton, Douglas

  Brown, Rt. Hon. George (Belper)

  Evans, Albert

  Howell, Denis (Small Heath)

  Brown, Thomas (Ince)

  Fernyhough, E.

  Howie, W. (Luton)

  Butler, Herbert (Hackney, C.)

  Finch, Harold

  Hoy, James H.

  Butler, Mrs. Joyce (Wood Green)

  Fitch, Alan

  Hughes, Cledwyn (Anglesey)

  Callaghan, James

  Fletcher, Eric

  Hughes, Emrys (S. Ayrshire)

  Carmichael, Neil

  Foley, Maurice

  Hughes, Hector (Aberdeen, N.)

  Hunter, A. E.

  Mitchison, G. R.

  Slater, Mrs. Harriet (Stoke, N.)

  Hynd, H. (Accrington)

  Monslow, Walter

  Slater, Joseph (Sedgefield)

  Hynd, John (Attercliffe)

  Moody, A. S.

  Small, William

  Irvine, A. J. (Edge Hill)

  Morris, Charles (Openshaw)

  Smith, Ellis (Stoke, S.)

  Irving Sydney (Dartford)

  Morris, John

  Snow, Julian

  Janner, Sir Barnett

  Moyle, Arthur

  Scrensen, R. W.

  Jay, Rt. Hon. Douglas

  Neal, Harold

  Soskice, Rt. Hon. Sir Frank

  Jeger, George

  Noel-Baker, Francis (Swindon)

  Spriggs, Leslie

  Jenkins, Roy (Stechford)

  Noel-Baker, Rt. Hn. Philip (Derby, S.)

  Steele, Thomas

  Johnson, Carol (Lawisham, S.)

  Oliver, G. H.

  Stewart, Michael (Fulham)

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

  O'Malley, B. K.

  Stonehouse, John

  Jones, Dan (Burnley)

  Gram, A. E.

  Stones, William

  Jones, Elwyn (West Ham, S.)

  Oswald, Thomas

  Strauss, Rt. Hn. G. R. (Vauxhall)

  Jones, J. Idwal (Wrexham)

  Owen, Will

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

  Jones, T. W. (Merioneth)

  Padley, W. E.

  Swain, Thomas

  Kelley, Richard

  Paget, R. T.

  Swingler, Stephen

  Kenyon, Clifford

  Pannell, Charles (Leeds, W.)

  Symonds, J. B.

  King, Dr. Horace

  Pargiter, G. A.

  Taverne, D.

  Lawson, George

  Parker, John

  Taylor, Bernard (Mansfield)

  Ledger, Ron

  Parkin, B. T.

  Thomas, George (Cardiff, W.)

  Lee, Frederick (Newton)

  Pavitt, Laurence

  Thompson, Dr. Alan (Dunfermline)

  Lee, Miss Jennie (Cannock)

  Pearson, Arthur (Pontypridd)

  Thomson, G. M. (Dundee, E.)

  Lever, Harold (Cheetham)

  Peart, Frederick

  Thornton, Ernest

  Lewis, Arthur (West Ham, N.)

  Pentland, Norman

  Thorpe, Jeremy

  Lipton, Marcus

  Popplewell, Ernest

  Tomney, Frank

  Loughlin, Charles

  Prentice, R. E.

  Wade, Donald

  Lubbock, Eric

  Price, J. T. (Westhoughton)

  Wainwright, Edwin

  Mabon, Dr. J. Dickson

  Probert, Arthur

  Warbey, William

  McBride, N.

  Proctor, W. T.

  Weitzman, David

  MacColl, James

  Pursey, Cmdr. Harry

  Wells, William (Walsall, N.)

  MacDermot, Niall

  Randall, Harry

  White, Mrs. Eirene

  McInnes, James

  Rankin, John

  Whitlock, William

  McKay, John (Wallsend)

  Redhead, E. C.

  Wigg, George

  Mackie, John (Enfield, East)

  Ress, Merlyn (Leeds, S.)

  Wilkins, W. A.

  McLeavy, Frank

  Reid, William

  Willey, Frederick

  MacMillan, Malcolm (Western Isles)

  Reynolds, G. W.

  Williams, D. J. (Neath)

  MacPherson, Malcolm (Stirling)

  Rhodes, H.

  Williams, W. T. (Warrington)

  Mahon, Simon

  Roberts, Albert (Normanton)

  Williams, E. G. (Edinburgh, E.)

  Mallalieu, E. L. (Brigg)

  Roberts, Goronwy (Caernarvon)

  Winterbottom, R. E.

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

  Robertson, John (Paisley)

  Woodburn, Rt. Hon. A.

  Manuel, Archie

  Robinson, Kenneth (St. Pancras, N.)

  Woof, Robert

  Mapp, Charles

  Rodgers, W. T. (Stockton)

  Wyatt, Woodrow

  Marsh, Richard

  Rodgers, G. H. R. (Kensington, N.)

  Yates, Victor (Ladywood)

  Mason, Roy

  Ross, William

  Zilliacus, K.

  Mayhew, Christopher

  Royle, Charles (Salford, West)

  Mellish, R. J.

  Shinwell, Rt. Hon. E.

  TELLERS FOR THE AYES:

  Mendelson, J. J.

  Silkin, John

  Mr. Charles A. Howell and

  Millan, Bruce

  Silverman, Julius (Aston)

  Mr. McCann.

  Milne, Edward

  Skeffington, Arthur

  NOES

  Agnew, Sir Peter

  Brewis, John

  Cunningham, Sir Knox

  Allan, Robert (Paddington, S.)

  Bromley-Davenport, Lt., Col-Sir Walter

  Curran, Charles

  Allason, James

  Brooke, Rt. Hon. Henry

  Currie, G. B. H.

  Amery, Rt. Hon. Julian

  Brown, Alan (Tottenham)

  Dalkeith, Earl of

  Anderson, D. C.

  Browne, Percy (Torrington)

  Dance, James

  Arbuthnot, John

  Bryan, Paul

  d'Avigdor-Goldsmid, Sir Henry

  Ashton, Sir Hubert

  Buck, Antony

  Deedes, Rt. Hon. W. F.

  Atkins, Humphrey

  Bullard, Denys

  Digby, Simon Wingfield

  Awdry, Daniel (Chippenham)

  Bullus, Wing Commander Eric

  Donaldson, Cmdr. C. E. M.

  Balniel, Lord

  Burden, F. A.

  Doughty, Charles

  Barlow, Sir John

  Butcher, Sir Herbert

  Douglas-Home, Rt. Hon. Sir Alec

  Barter, John

  Campbell, Gordon (Moray & Nairn)

  Drayson, G. B.

  Batsford, Brian

  Carr, Rt. Hon. Robert (Milcham)

  du Cann, Edward

  Beamish, Col. Sir Tufton

  Cary, Sir Robert

  Duncan, Sir James

  Bell, Ronald

  Channon, H. P. G.

  Duthie, Sir William (Banff)

  Bennett, F. M. (Torquay)

  Clark, Henry (Antrim, N.)

  Eden, Sir John

  Bennett, Dr. Reginald (Gos & Fhm)

  Clark, William (Nottingham, S.)

  Elliot, Capt. Walter (Carshalton)

  Berkeley, Humphry

  Cleaver, Leonard

  Elliot, R. W. (Newc'tle-upon-Tyne, N.)

  Bevins, Rt. Hon. Reginald

  Cole, Norman

  Emery, Peter

  Bidgood, John C.

  Cooke, Robert

  Emmet, Hon. Mrs. Evelyn

  Biffen, John

  Cooper, A. E.

  Errington, Sir Eric

  Biggs-Davison, John

  Cooper-Key, Sir Neill

  Erroll, Rt. Hon. F. J.

  Bingham, R. M.

  Cordeaux, Lt.-Col. J. K.

  Farey-Jones, F. W.

  Birch, Rt. Hon. Nigel

  Cordle, John

  Farr, John

  Bishop, F. P.

  Corfield, F. V.

  Fell, Anthony

  Black, Sir Cyril

  Costain, A. P.

  Fisher, Nigel

  Bossom, Hon. Clive

  Coulson, Michael

  Fletcher-Cooke, Charles

  Bourne-Arton, A.

  Courtney, Cdr. Anthony

  Foster, Sir John

  Box, Donald

  Craddeck, Sir Beresford (Spelthorne)

  Fraser, Rt. Hn. Hugh (Stafford & Stone)

  Boyd-Carpenter, Rt. Hon. John

  Crawley, A'dan

  Fraser, Ian (Plymouth, Sutton)

  Braine, Bernard

  Critchley, Julian

  Freeth, Denzil

  1118

  1119

  Galbraith, Hon. T. G. D.

  Lilley, F. J. P.

  Roberts, Sir Peter (Heeley)

  Gammans, Lady

  Lindsay, Sir Martin

  Robinson, Rt., Hn. Sir R. (B'pool, S.)

  Gardner, Edward

  Linstead, Sir Hugh

  Rodgers, John (Sevenoaks)

  Gibson-Watt, David

  Litchfield, Capt. John

  Roots, William

  Gilmour, Ian (Norfolk, Central)

  Lloyd, Rt. Hn. Geoffrey (Sut'nC'dfield)

  Royle, Anthony (Richmond, Survey)

  Gilmour, Sir John (East Fife)

  Lloyd, Rt. Hn. Selwyn (Wirral)

  Scott-Hopkins, James

  Glyn, Dr. Alan (Clapham)

  Longbottom, Charles

  Sharples, Richard

  Glyn, Sir Richard (Dorset, N.)

  Loveys, Walter H.

  Shaw, M.

  Goodhart, Philip

  Lucas-Sir Jocelyn

  Shepherd, William

  Goodhew, Victor

  Lucas-Tooth, Sir Hugh

  Skeet, T. H. H.

  Gough, Frederick

  McAdden, Sir Stephen

  Smith, Dudley (Br'ntf'd & Chiswick)

  Gower, Raymond

  McLaren, Martin

  Soames, Rt. Hon. Christopher

  Grant-Ferris, R.

  McLaughlin, Mrs. Patricia

  Speir, Rupert

  Green, Alan

  Maclay, Rt. Hon. John

  Stainton, Keith

  Gresham Cooke, R.

  Maclean, Sir Fitzroy (Bute & N. Ayrs)

  Stanley, Hon. Richard

  Gurden, Harold

  McLean, Neil (Inverness)

  Stevens, Geoffrey

  Hall, John (Wycombe)

  McMaster, Stanley R.

  Steward, Herold (Stockport, S.)

  Hamilton, Michael (Wellingborough)

  Maddan, Martin

  Stodart, J. A.

  Harris, Frederic (Croydon, N. W.)

  Maginnis, John E.

  Stoddart-Scott, Col. Sir Malcolm

  Harris, Reader (Heston)

  Maitland, Sir John

  Storey, Sir Samuel

  Harrison, Brian (Maldon)

  Markham, Major Sir Frank

  Studholme, Sir Henry

  Harrison, Col. Sir Harwood (Eye)

  Marples, Rt. Hon. Ernest

  Summers, Sir Spencer

  Harvey, Sir Arthur Vere (Macclesf'd)

  Marshall, Sir Douglas

  Talbot John E.

  Harvey, John (Walthamstow, E.)

  Marten, Neil

  Tapsell, Peter

  Harvie, Anderson, Miss

  Mathew, Robert (Honiton)

  Taylor, Edwind (Bolton, E.)

  Hastings, Stephen

  Matthews, Gorden (Meriden)

  Taylor, Frank (M'ch'st'r, Moss Side)

  Heald, Rt. Hon. Sir Lionel

  Maude, Angus (Stratford-on-Avon)

  Taylor, Sir William (Bradford, N.)

  Heath, Rt. Hon. Edward

  Mawby, Ray

  Teeling, Sir William

  Henderson, John (Cathcart)

  Maxwell-Hyslop, R. J.

  Temple, John M.

  Hendry, Forbes

  Mills, Stratton

  Thomas, Sir Leslie (Canterbury)

  Hicks Beach, Maj. W.

  Miscampbell, Norman

  Thomas, Peter (Conway)

  Hiley, Joseph

  Montgomery, Fergus

  Thompson, Sir Kenneth (Walton)

  Hill, Mrs. Eveline (Wythenshawe)

  More, Jasper (Ludlow)

  Thompson, Sir Richard (Croydon, S.)

  Hill, J. E. B. (S. Norfolk)

  Morgan, William

  Thorneycroft, Rt. Hon. Peter

  Hirst, Geoffrey

  Mott-Radclyffe, Sir Charles

  Thornton-Kemsley, Sir Colin

  Hobson, Rt. Hon. Sir John

  Neave, Airey

  Tiley, Arthur (Bradford, W.)

  Hocking, Philip N.

  Nicholls, Sir Harmar

  Tilney, John (Wavertree)

  Hogg, Rt-Hon. Quintin

  Nugent, Rt. Hon. Sir Richard

  Touche, Rt. Hon. Sir Gordon

  Holland, Philip

  Oakshott, Sir Hendrie

  Turner, Colin

  Hollingworth, John

  Orr, Capt. L. P. S.

  Turton, Rt. Hon. R. H.

  Hope, Rt. Hon. Lord John

  Orr-Ewing, Sir Ian (Hendon, North)

  Tweedsmuir, Lady

  Hopkins, Alan

  Osbern, John (Hallam)

  Van Straubenzee, W. R.

  Hornby, R. P.

  Osborne, Sir Cyril (Louth)

  Vane, W. M. F.

  Hornsby-Smith, Rt. Hon. Dame P.

  Page, Graham (Crosby)

  Vaughan-Morgan, Rt. Hon. Sir John

  Howard, Hon. G. R. (St. Ives)

  Page, John (Harrow, West)

  Vickers, Miss Joan

  Howard, John (Southampton, Test)

  Pannell, Norman (Kirkdale)

  Vosper, Rt. Hon. Dennis

  Hughes Hallett, Vice-Admiral John

  Partridge E.

  Wader, David

  Hughes-Young, Michael

  Pearson, Frank (Clitheroe)

  Walker, Peter

  Hurd, Sir Anthony

  Peel, John

  Walker-Smith, Rt. Hon. Sir Derek

  Iremonger, T. L.

  Peytown, John

  Wall, Patrick

  Irvine, Bryant Godman (Rye)

  Pickthorn, Sir Kenneth

  Ward, Dame Irene

  James, David

  Pike, Miss Mervyn

  Watkinson, Rt. Hon. Harold

  Jennings, J. C.

  Pitman, Sir James

  Webster, David

  Johnson, Dr. Donald (Cralisle)

  Pitt, Dame Edith

  Whitelaw, William

  Johnson, Eric (Blackley)

  Pounder, Rafton

  Williams, Dudley (Exeter)

  Johnson, Smith, Geoffrey

  Powell, Rt. Hon. J. Enoch

  Williams, Paul (Sunderland, S.)

  Jones, Arthur (Northants, S.)

  Price, David (Eastleigh)

  Wills, Sir Gerald (Bridgwater)

  Jones, Rt. Hon. Aubrey (Hall Green)

  Prior, J. M. L.

  Wilson, Geoffrey (Truro)

  Joseph, Rt. Hon. Sir Keith

  Prior-Palmer, Brig. Sir Otho

  Wise, A. R.

  Kerans, Cdr. J. S.

  Proudfoot, Wilfred

  Wolrige-Gorden, Patrick

  Kerby, Capt. Henry

  Pym, Francis

  Word, Rt. Hon. Richard

  Kerr, Sir Hamilton

  Quennell, Miss J. M.

  Woodhouse, C. M.

  Kershaw, Anthony

  Ramsden, Rt. Hon. James

  Woodnutt, Mark

  Kimball, Marcus

  Rawlinson, Sir Peter

  Woollam, John

  Kitson, Timothy

  Redmayne, Rt. Hon. Martin

  Worsley, Marcus

  Lagden, Godfrey

  Rees, Hugh (Swansea, W.)

  Yates, William (The Wrekin)

  Lambtron, Viscount

  Rees-Davies, W. R. (Isle of Thanet)

  Langford-Holt, Sir John

  Renton, Rt. Hon. David

  TELLERS FOR THE NOES:

  Leather, Sir Edwin

  Ridley, Hon. Nicholas

  Mr. Chichester-Clark and

  Lewis, Kenneth (Rutland)

  Ridsdale, Julian

  Mr. MacArthur.

  MRS. SEARLE, CARDIFF (ARREST)
  Motion made, and Question proposed, That this House do now adjourn—[Mr. Hugh Rees.]
  10.9 p.m.
  Mr. George Thomas: I wish to bring to the attention of the House a serious miscarriage of justice which I believe has been experienced by one of my constituents. I regard this House as the custodian of the liberty of every subject of the realm. I believe it to be the protector of individual rights and that on both sides of the House right hon. and hon. Gentlemen are equally concerned when an injustice has been committed. An injustice to one is an injustice to all. I therefore seek the intervention of the Home Office in the disturbing case involving Mrs. Searle, of Loftus Street, Cardiff and I have sent details to the Home Office.
  In August, 1962, Mrs. Searle was fined £3 for exceeding the speed limit and she was told that her licence would be endorsed. She was fined at Cowbridge Magistrates' Court. This was her first offence. She had never been in a police court before. She visited Canton Police Station, at Cardiff, and asked whether she could pay her fine. She was told that she must pay it in the area where she had been fined. Cowbridge is about eight miles from Cardiff. So my constituent did the sensible thing. She obtained a recorded delivery letter and sent the money—this was her only mistake—and the licence together. There is no dispute about the recorded delivery.
  The licence was returned to Mrs. Searle and on it was written—I have seen it—"Fined £3, licence endorsed". To her, this was a receipt. She had never had to pay a fine before. I must confess that I should have accepted a licence so written on and endorsed as a normal receipt. Nothing more was heard of this case and she was not surprised. She had paid the fine and her conscience was clear. But on Saturday, 11th January, 1964, three officers, in a police car, went to her home in Loftus Street to arrest Mrs. Searle for the non-payment of the fine.
  When she told an officer that she had paid the fine, he, very wisely, accepted her explanation and went away. When
  1122
  Mr. Searle, who is a railwayman, came home and heard that the police had been to his house, his reaction was the same as that of any other innocent man. He advised his wife to call at Cowbridge Police Station and tell them they must not do this sort of thing and that she had paid the fine.
  Mrs. Searle called at Cowbridge Police Station to protest that the police had been to her home. To her dismay and astonishment, she was arrested. She was submitted to the humiliation of having the contents of her handbag tipped out and all the items recorded. I understand that a policewoman searched her as if she were a dangerous woman. She was put on £5 bail to appear at the Cow-bridge Magistrates' Court on Tuesday, 21st January.
  Mrs. Searle's reaction was that of an entirely innocent person. She took two courses of action. She went to the South Wales Echo and told her story because she was so indignant. I wish to pay a tribute to the South Wales Echo for the way in which a very serious miscarriage of justice has been brought to light. Mrs. Searle also wrote to me and I visited her home. Hers is a family of three. They never buy anything on hire purchase. They will buy only what they can pay for They told me that they would not have a television set until they had saved the £73 to pay for it. I say that only to tell the House and the Minister the sort of people with whom we are dealing.
  I took immediate action; experience has taught me that it is always wise if we can settle these matters locally so to do. I called at Canton Police Station and was advised that it was nothing to do with them and that it was wiser to contact the Glamorgan County Constabulary. I contacted a very high-ranking officer in the Glamorgan County Constabulary. He is a man who is most highly respected and in whose integrity I have absolute trust, a man who has the trust both of the force and of the public. He told me that he had looked at the fines book and opposite Mrs. Searle's name had been written in pencil, "Fine paid", but that it had subsequently been crossed out and the officer who dealt with this case had, unfortunately, since died.
  I am quite willing to give the name of this high-ranking police officer to the

  1123
  Minister, but which I do not care to give it to the House as I do not think it essential. When I put to him that this would undoubtedly clear Mrs. Searle when the case came to court, he quite agreed. I may have misunderstood him, but I understood from him that the police would give such evidence when the case was raised in court next day. I obtained permission from him to call on Mrs. Searle and to tell her that she need not worry; she was bound to be cleared next day when the matter came up in court. I went to her and told her so in confidence.
  Imagine how surprised and dismayed I was when, on 21st January, as soon as I came out of a Standing Committee. I had a telephone call from the South Wales Echo to tell me what had happened at Cowbridge Magistrates' Court. The magistrates' clerk had done most of the talking. The magistrates had not been informed that "Fine paid" had been written opposite Mrs. Searle's name and subsequently crossed out. The fines book was not produced. I am a great believer that in a magistrates' court the magistrates should be in charge. Clerks should be there to give advice when they are asked for it, particularly when a magistrates' clerk is involved as he was in this case. I think it most unfortunate that he should have said to Mrs. Searle in the court:
  "The only people concerned in this are yourself, ourselves"—
  linking himself with the bench—
  "and the Home Office".
  He forgot the public, he forgot the Press and he forgot this House. When any person comes before a court in this land it is not only that person who is concerned, but the public, too, which has a right to see that justice is done and is seen to be done. Mrs. Searle, when she came out of the court, was interviewed by the Press. I quote from the South Wales Echo of 21st January:
  "Weeping, she said, 'I was hoping they would clear my name today. I do not know what I shall do now. It is the first time I have been in a court. It was a terrible experience.'"
  I am glad to see the Under-Secretary of State for the Home Department here to reply to the debate. I am grateful to the hon. Lady. I ask her why it is
  1124
  that 18 months elapsed from the time when Mrs. Searle had her licence back and when she says she paid before the police were at her door? She had no warning notice of any sort. This was made clear in the court on 21st January. There were people in the court that day for not paying fines six months before, but this was 18 months before.
  Another serious aspect of the case is that the magistrates had on the paper before them that she had been fined in August, 1963. When Mrs. Searle said, "No, 1962", it had to be altered because the clerk had to confirm that Mrs. Searle was right, that it was not six months but 18 months since the offence had taken place. Since then, there have been surprising developments. I have had two letters from people who have suffered identical experience at the same magistrates' court. I have the letters with me and I am prepared to give them to the Under-Secretary for her to read when she is considering the request I make to her tonight.
  It is a cardinal principle of British justice that people are presumed innocent until they are proved guilty. In this case, the benefit of the indisputable doubt about the entry being in the book and about the recorded delivery was not given to Mrs. Searle. I want to know why the fines book was not produced before the magistrates. Why was all the evidence not put before them? Why did the clerk play such an active part in the proceedings since his department is responsible for collecting fines, although I understand that the officer responsible has since died? I make no more serious charge than incompetence and mistakes in the office. They are human and I do not wish to go further, but I believe that it would be a grievous thing to let this woman suffer the burning sense of injustice which she has at present.
  I hope that the Home Office will not feel I have wasted its time by raising this question. I believe, and I have done my best to do justice to it, that we have the happiness of a family at stake here, where a grave injustice has been done to a mother. We all know the unhappiness of people when police call at their homes and those are respectable homes. In this case, I believe that justice demands a recommendation of

  1125
  the Queen's pardon and that this woman's name should be cleared.
  I shall not rest until justice is done and Mrs. Searle is cleared of the dishonesty which will shadow her until a pardon is granted.
  10.23 p.m.
  The Joint Under-Secretary of State for the Home Department (Miss Mervyn Pike): This is a very unhappy case and I am sure that we are all grateful to the hon. Member for Cardiff, West (Mr. G. Thomas) for bringing it forward, and for the manner in which he has approached it.
  As the House knows, the question whether a fine has or has not been paid is a matter for the court, but as the hon. Gentleman has raised the matter, my right hon. Friend had inquiries made from the Clerk to the Cowbridge Justices and the Chief Constable. The facts, as they have been reported to us, are as follows.
  On 7th August, 1962 Mrs. Searle was fined £3 in the Cowbridge Magistrates' Court for a speeding offence and her licence was ordered to be endorsed. Mrs. Searle had availed herself of the procedure of sending a written plea of guilty, so she did not appear at the hearing. She was duly given notice of the fine, and, as she had not sent her licence to the court, she was also informed that this was required for endorsement.
  On or about 16th August, Mrs. Searle sent her licence by recorded delivery post; it was endorsed and sent back to her.
  In October, 1963, the Clerk to the Cowbridge Justices—he had been appointed in March, his predecessor having died the previous December—made arrangements for the enforcement of outstanding fines at the Cowbridge Court. The clerk is also clerk for another division and has an assistant at the Cow-bridge office. There was no entry in the official receipt books, cash books and ledger that this fine had been paid. I will deal in a moment with the hon. Member's point about the pencilled note.
  The justices issued a means inquiry warrant on 9th November. The police visited Mrs. Searle on two occasions; she said she had already paid the fine, so the police did not on those occasions
  1126
  execute the warrant, but sought further instructions.
  On 14th January, Mrs. Searle called at the Cowbridge police station to make inquiries about the matter, and repeated that she had already paid the fine. Police officers called personally at the magistrate's clerk's office to see how the matter stood. They were told that the money had not been paid and that the warrant must be executed. Accordingly, while Mrs. Searle was still at the police station, the warrant was executed; Mrs. Searle was arrested, and bailed to appear in court on 21st January.
  When Mrs. Searle appeared she stated on oath that she had paid the fine by enclosing three £1 notes with her licence when she sent it the previous year. When asked why she could not produce a receipt, she said that she regarded the endorsement on her driving licence as a receipt—and I do not think there is anything unreasonable in that. I freely admit to the House that, never having had to pay a fine myself, I would have taken the same view.
  She strenuously denied any suggestion that she might have forgotten to put the notes in the envelope. The clerk to the justices stated that he had not received the money, that no receipt had been issued and that no entry appeared in the accounts. The chairman then told Mrs. Searle that she would have to pay and offered her time. Mrs. Searle decided not to ask for time and paid the money there and then rather, as she put it, than have all this trouble.
  I should now like to say something about the pencilled entry to which the hon. Gentle man drew attention. The clerk reported that his assistant at Cow-bridge keeps an informal record in a notebook. This notebook is not part of the official records of the court. She keeps it merely as a matter of convenience and for quick reference.
  In this notebook—written in ink, and not in pencil—were the words "licence", struck out indicating that the licence had been received and endorsed, and the word "paid". The existence of this entry was brought to the notice of the clerk before the court heard Mrs. Searle on 21st January and he questioned the assistant closely about it. Earlier, when it was decided to apply to the justices

  1127
  for a warrant, this entry was very carefully scrutinised and the records thoroughly checked.
  On the one hand there was this entry in the notebook; on the other hand there was no entry in any of the official books, and there was no surplus money, and no discrepancies in the accounts. The conclusion was reached that the entry in the notebook was a mistake. However, the court was not aware of the entry.
  I thought it right that we should ask the clerk to the justices to tell the justices or their chairman of this entry. He has done this and all the justices concerned: that it, those who were sitting on 21st January, state that in their considered view, knowledge of it would not have affected their decision. But, as I have said, the entry in the notebook first came to the notice of the clerk on the day before the court sat to deal with Mrs. Searle's case, and he went into it the day before—
  Mr. G. Thomas: He did not tell the magistrates.
  Miss Pike: No. The hon. Gentleman is perfectly correct in saying that the burden of proof that the fine had been paid rested on Mrs. Searle. His duty was to state to the court how the accounts stood—and I do not question his good faith—he decided that it was not relevant to the court's determination of the question whether the fine had been paid.
  I think it would have been better if the court had been aware at the time of the notebook entry particularly since the fine had been outstanding for a great length of time. This circumstance seems to me to have made it desirable that the court should be in possession of any piece of information, however small, that seemed to have a bearing on the question.
  But what concerns this House is not whether the court were right in thinking Mrs. Searle had not paid her fine or whether Mrs. Searle was right but whether a satisfactory system exists whereby the possibility of disputes of this kind is minimised. I am grateful to the hon. Gentleman for raising this case because there are certain aspects of it that must obviously cause concern. The hon. Gentleman has now brought certain other cases to notice, and if, as
  1128
  he says, he will supply me with further particulars, I shall certainly take them up.
  The hon. Gentleman did not mention these other cases in the first instance and naturally my inquiries were directed to Mrs. Searle's case only.
  Mr. G. Thomas: These cases have come to my knowledge as a result of the publicity which Mrs. Searle's case has had, but I hope that we shall hear something about them.
  Miss Pike: I appreciate that, and that is why I shall be grateful when the hon. Gentleman gives me the particulars, so that we can go into the whole matter much more thoroughly. It is impossible to have a system which eliminates all possibility of dispute.
  The Magistrates' Courts Rules require the clerk to the justices to give a receipt for money received by him in payment of a fine and one would think that would ordinarily be sufficient to eliminate disputes. Indeed, in ordinary commerce this is so; one proves payment by producing a receipt.
  I do not think that in general any amendment of the Rules would produce an infallible result. The books of the courts are regularly audited and the possibility of error is reduced to a minimum. However, it is not enough that the Rules should provide a satisfactory system. We must be sure that there could be no proper ground for complaint about the way in which the system is operated.
  There are certain features about the procedure that was adopted in this case that I should like to inquire further into—for example, the relationship between the informal record in the notebook and the official books of the court, and the organisation of the court office for the day-to-day work. It is disturbing that so long should elapse between the imposing of fines and their enforcement, because of course the longer one leaves these things the more chance there is of a dispute; in this particular case the clerk appreciates that.
  In the ordinary course of examining accounts, the auditor does take up with clerks cases in which fines have remained unenforced, and I shall undertake to see whether more guidance

  1129
  should be given to the clerks of magistrates' courts on the importance of not letting fines remain on the books of courts without action being taken over long periods such as happened in this case.
  The hon. Gentleman naturally wants a full inquiry into this affair. I do not think that further inquiry into the facts will help us very much; I have inquired into them and given them as fully as I can to the House.
  The main thing is to see that there can be no complaint that the proper procedures are not being applied, and hence, so far as possible, no occasion for disputes of this kind in the future.
  The management of justices' clerks' offices is primarily for the clerk himself, but the magistrates' courts committee of the county has general functions in respect of the magistrates' courts in the county as a whole.
  As I said, there are certain features of this case which seem to me to call for further inquiry, and I will take them up with the clerk. The present clerk did not take up his appointment in the division until March last year, and we all appreciate that he has possibly been working under some difficulties. I shall also take the matter up with the magistrates' courts committee, and I will inform the hon. Gentleman of the further results, and I shall also take up the other cases he mentioned.
  I am certain, and I am sure that the House is, too, that Mrs. Searle throughout acted in good faith and we all
  1130
  naturally regret that these disagreeable events should have happened.
  We hope that the proceedings this evening will have gone some way to mitigate the distress which she has suffered. Until I have made further inquiries, I prefer not to make any comment on what took place. I do not think that that would be fair. But whether the fine was originally received or not was for the court, and it would not be right for my right hon. Friend, even if he had the power to do so, so seek to reverse the decision of the court in this case
  I conclude by saying to the hon. Gentleman that I shall go thoroughly into this case on the lines which I have outlined tonight. My right hon. Friend will consider his request. I know that he would not expect me to give him a reply now. This is an unhappy case. We are grateful to the hon. Gentleman for raising it, and I hope that our inquiries will go a long way to mitigate the damage which has been caused.
  Mr. G. Thomas: I thank the hon. Lady very much for the understanding way in which she has replied to the debate. May I ask her whether I may look forward to the result of her further inquiries, bearing in mind my request regarding a pardon?
  Miss Pike: We shall certainly look into all the matters which the hon. Gentleman has raised this evening.
  Question put and agreed to.
  Adjourned accordingly at twenty-five minutes to Eleven o'clock.

NATIONAL FINANCE
  Income Tax
  Income Tax
  Industries, France (United Kingdom Investment)
  Industries, France (United Kingdom Investment)
  Regional Boards for Industry
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  Civil Servants
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  Cigar and Pipe Tobacco (Tax)
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  Companies (Capital Allowances and Gross Dividend)
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  Investment Allowances
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  Richard Thomas and Baldwins Ltd. (Capital Reorganisation)
  Richard Thomas and Baldwins Ltd. (Capital Reorganisation)
  Unemployment, Northern Ireland
  Unemployment, Northern Ireland
  Pool Betting Duty (Dog Racecourses)
  Pool Betting Duty (Dog Racecourses)
  Government Offices (Dispersal)
  Government Offices (Dispersal)
  Royal Shakespeare Theatre Company
  Royal Shakespeare Theatre Company
  Iron and Steel Holding and Realisation Agency
  Iron and Steel Holding and Realisation Agency
  Budget
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  Gambling and Gaming (Taxation)
NYASALAND
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HIGH COMMISSION TERRITORIES
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WEST INDIES
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  Colonial Office Library
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ADEN
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PUBLIC BUILDING AND WORKS
  National Building Agency
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  The Treasury
  The Treasury
HOUSING
  House Purchase (Local Authority Loans)
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  Statistics, Bournemouth
  Statistics, Bournemouth
LOCAL GOVERNMENT
  Bournemouth Development Plan
  Bournemouth Development Plan
MINISTRY OF AVIATION
  European Launcher Development Organisation
  European Launcher Development Organisation
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  Sacred Heart Convent School, Dagenham (Playing Fields)
  Sacred Heart Convent School, Dagenham (Playing Fields)
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  Mathematics (Graduate Teachers)
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  Apprenticeships and Technical Training (Letter)
  Apprenticeships and Technical Training (Letter)
  Rush Green College of Further Education
  Rush Green College of Further Education
INDUSTRY, TRADE AND REGIONAL DEVELOPMENT
  British Lion Film Company
  British Lion Film Company
  Local Authorities
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  China and Earthenware
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MINISTRY OF POWER
  Colvilles Limited (Loan)
  Colvilles Limited (Loan)
AGRICULTURE, FISHERIES AND FOOD
  Hill Cow Subsidy (Montgomeryshire)
  Hill Cow Subsidy (Montgomeryshire)
  Milk (Small Containers)
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  Live Animals and Carcase Meat (Export to Continent)
  PRESIDENT JOHNSON
  PRESIDENT JOHNSON
  LAW AND ORDER (SPECIAL INTERNATIONAL FORCE)
  LAW AND ORDER (SPECIAL INTERNATIONAL FORCE)
  DISARMAMENT
  DISARMAMENT
  EAST AFRICA (SECURITY)
  EAST AFRICA (SECURITY)
  FARM INCOMES
  FARM INCOMES
  PROPOSED RAILWAY CLOSURES, SCOTLAND
  PROPOSED RAILWAY CLOSURES, SCOTLAND
ROYAL NAVY
  Admiralty Engineering Service
  Admiralty Engineering Service
HOSPITALS
  Small Hospitals
  Small Hospitals
  SCOTTISH UNIVERSITIES
  SCOTTISH UNIVERSITIES
HOME DEPARTMENT
  Homosexuality
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  General Election
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EMPLOYMENT
  Montgomeryshire
  Montgomeryshire
  Railwaymen (Mid-Wales)
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  Government Training Centres
  Government Training Centres
ROADS
  Trunk Roads, Montgomeryshire
  Trunk Roads, Montgomeryshire
SHIPPING
  Merchant Shipping Acts
  Merchant Shipping Acts

Preamble
The House met at half past two of the clock, The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of St. Albans

SEA DUMPING OF CONTAMINATED SOIL
2.35 p.m.
LORD DOUGLAS OF BARLOCH: My Lords, I beg leave 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 have been consulted about the dumping in the sea of soil contaminated with fluoracetamide; where this soil is to be dumped; and what steps will be taken to ensure that the poison is not disseminated by ocean currents or by fish and other marine animals.]
THE JOINT PARLIAMENTARY SECRETARY, MINISTRY OF AGRICULTURE, FISHERIES AND FOOD (LORD ST. OSWALD): Yes, my Lords. It is in fact on the advice of Her Majesty's Government that the manufacturers are removing this material from their factory site. The manufacturers are arranging under Government guidance to dump it in the Atlantic
2
in very deep water beyond the Continental Shelf where no possible harm could result to fish or other marine life.
LORD DOUGLAS OF BARLOCH: My Lords, is the noble Lord aware that this stuff is so poisonous that it is lethal in a dilution which can hardly be detected by chemical analysis? And, with regard to the method of disposal, is it proposed to put the contaminated soil in waterproof containers which will ensure that it is not disseminated in the sea?
LORD ST. OSWALD: No, my Lords. We have taken scientific advice on this, and we are told on the best authority that it is not necessary when dumped in that depth, nearly two and a half miles of water, to put it in containers.
LORD DOUGLAS OF BARLOCH: My Lords, the noble Lord assumes that it will sink to the bottom. What evidence is there of that? Will the soil not become flocculent and rest quite near the surface for long periods of time?
LORD ST. OSWALD: My Lords, again we have taken the best advice on this, and we are told not. In addition to the Ministry of Agriculture's scientists, advice has been sought from Sir Rudolf Peters, Emeritus Professor of Bio-Chemistry at Oxford and a noted authority on fluoracetamide and on the disposal of chemicals.
BARONESS SUMMERSKILL: My Lords, it appears that there are now noted authorities on this material. Why have they not given advice to the

3
Government before regarding the toxicity of this material? Why has this alarming ignorance prevailed and only now are the Government aware of the dangers? Because of this, how can we be assured that this new dumping will be quite innocent and will not give rise to more trouble?
LORD ST. OSWALD: My Lords, there appears to be more than one question involved in the noble Baroness's supplementary. The innocence of the dumping is, I think, beyond question. We have, in fact, taken great care to assure ourselves that, dumped in that part of the ocean, it will do no harm. As regards the unsuspected nature of this chemical, it is true that as a result of this industrial accident—I would point out to the noble Baroness that this was not the result of agricultural, or horticultural use, but was the result of an industrial accident; I think that is an important point—we have learned, for the first time, I agree, of the effect that this can have on dogs, though on no other animals, so far as we are aware, as a secondary poison. This is what we have discovered about it as the result of this accident.
BARONESS SUMMERSKILL: My Lords, could the noble Lord just answer this question? In view of the powerful nature of this material, how can we be certain that it will not affect sea food of any kind?
LORD ST. OSWALD: Well, we are dumping it so that it will descend to a depth of two and a half miles, 2,000 fathoms. At that depth no fish eaten by human beings can live or move or circulate in any way.
LORD SHEPHERD: My Lords, can the noble Lord say whether the soil will be bagged sc that it will sink, or that it will be dumped en mass so that it will float? One often sees in many places soil floating on the surface of the water for quite some distance.
LORD ST. OSWALD: My Lords, I confess that I have never seen soil floating on the top of the water. But there is 2,000 tons of it which is being dumped, and this appears to be a safe and proper way to dispose of it.
LORD SHACKLETON: My Lords, would the noble Lord reconsider his remarks on the secondary toxicity of fluoracetamide where dogs are concerned? Has he considered what the secondary toxicity is so far as human beings are concerned? Has he himself looked at any biochemical textbook on fluoracetamide which, as one well knows, is the most poisonous and least recognisable of poisons? If, as my noble friend suggested, it is now reckoned to be safe to dump it in the sea, how was it that it was not thought safe to be dumped in gardens? Is the noble Lord suggesting that such chemicals as these are still safe to use in gardens? If so, why is he asking for them to be withdrawn? And if he is asking for them to be withdrawn, will he publish the names of these particular chemicals, which people may have in their houses?
LORD ST. OSWALD: My Lords, that is being done. In fact, all existing stocks of this chemical used as a pesticide are being disposed of or returned to the manufacturers, and they will not be issued again as pesticides. What was the other question the noble Lord asked?
LORD SHACKLETON: There were several, I quite agree. What I was asking the noble Lord was why he is withdrawing them at all. He has referred to secondary toxicity in regard to dogs. How does he withdraw it from people who already have it in their houses?
LORD ST. OSWALD: They are being circularised and advised to dispose of it or to return it to the manufacturers. The question, which the noble Lord will be the first to appreciate, is that of concentration. The form in which it poisoned the cows in this instance was a very powerful concentration. The form in which it was issued as insecticide was very much weaker and could not be as dangerous as it was in the fields where it escaped by an error.
BARONESS SUMMERSKILL: My Lords—
THE MINISTER WITHOUT PORTFOLIO (LORD CARRINGTON): My Lords, would the noble Baroness allow me to interrupt? I do not very often intervene on these occasions and we do not have many Rules of Order in this House, but I think on this occasion we are in danger of having a small debate on this subject.

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I wonder whether your Lordships might think that, if there is such great interest in this subject, an unstarred Question should be put down, rather than that there should be a debate this afternoon.

BRITISH TROOPS IN UGANDA AND TANGANYIKA
2.43 p.m.
THE EARL OF LISTOWEL: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
[The Question was as follows:
To ask Her Majesty's Government for how long and on what terms British troops will remain in Uganda and Tanganyika.]
THE MINISTER OF STATE FOR COMMONWEALTH RELATIONS AND FOR THE COLONIES (THE DUKE OF DEVONSHIRE): My Lords, this is a matter we shall have to discuss with the Governments concerned. My right honourable friend has already said in another place that he proposes to have early consultations with the East African Governments.
THE EARL OF LISTOWEL: My Lords, I am delighted to hear that there will be early consultations with the Governments concerned. May I ask the noble Duke whether these discussions will include an offer on the part of Her Majesty's Government of assistance to these Governments in the training of their armed forces—for example, by providing British military missions, which have been acceptable in other independent African countries?
THE DUKE OF DEVONSHIRE: We are naturally most anxious to help our Commonwealth partners in any way we can, and any suggestions as to how we can help in the Service field will, of course, be sympathetically considered by Her Majesty's Government. How these talks will develop remains to be seen, but we will give urgent and sympathetic consideration to any suggestions put forward by the East African Governments.

PREROGATIVE OF MERCY IN SOUTHERN RHODESIA
LORD WALSTON: My Lords, I beg leave 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 the prerogative of mercy in Southern Rhodesia rests solely with the Governor acting on the advice of his Council: or if it may rest with the Governor alone or acting on the advice of Her Majesty's Government in the United Kingdom.]
THE LORD CHANCELLOR (LORD DILHORNE): My Lords, under the Southern Rhodesia (Constitution) Order in Council, 1961, the Governor may in Her Majesty's name and on Her Majesty's behalf exercise the prerogative of mercy. When deciding whether to do so he is bound, under the Constitution, to act in accordance with the advice of the Governor's Council, which consists of the Prime Minister and Ministers of Southern Rhodesia. The exercise of the prerogative, therefore, does not rest with the Governor alone, nor is he required to act on the advice of Her Majesty's Government in the United Kingdom.
LORD WALSTON: My Lords, I am most grateful to the noble and learned Lord for his full Answer. May I further ask him if it is a fact that Section 49 of the Southern Rhodesia Constitution, which I believe deals with the prerogative of mercy, is one of those sections which can be amended by Parliament in this country without reference to the Government of Southern Rhodesia?
THE LORD CHANCELLOR: Article 111 of the Constitution reads as follows:
"Full power and authority is hereby reserved to Her Majesty by Order-in-Council to amend, add to or revoke the provisions of Sections"—
and one of the sections is Section 49—
"and any Order-in-Council made by virue of this section may vary or revoke any previous Order so made".
THE EARL OF SWINTON: My Lords, may I ask the noble and learned Lord the Lord Chancellor whether, apart from any particular provisions with regard to

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the Constitution in Southern Rhodesia, it has not been the consistent practice of all Secretaries of State for the Colonies to regard and hold the Governor of the Colony entirely and personally responsible, as the representative of the Sovereign, for exercising the prerogative of mercy, without reference either to the Secretary of State or to any Council?
THE LORD CHANCELLOR: My Lords, I do not think I could give a very full answer to that question without a considerable amount of research. I am aware of one case, in 1947 I think it was, when, under the grant of power to a Governor to exercise the prerogative by Letters Patent, the view was expressed that there was a residual power left in this country. I know views upon that differ, and I myself cannot speak as to what has been the practice of successive Secretaries of State on this matter.

BUSINESS OF THE HOUSE
EARL ST. ALDWYN: My Lords, in view of the considerable number of Amendments on the Hire-Purchase (No. 2) Bill which have to be considered by the House, dinners will be available this evening. It is proposed that there should be a dinner adjournment at some suitable moment to be decided through the usual channels.

COMMITTEE FOR PRIVILEGES
THE CHAIRMAN OF COMMITTEES (LORD MERTHYR): My Lords, I beg to move the first Motion standing in my name.
Moved, That the Lord Shepherd be proposed to the House as a Member of the Committee for Privileges in the place of the late Earl of Lucan.—(Lord Merthyr.)
On Question, Motion agreed to.

SPECIAL ORDERS COMMITTEE
LORD MERTHYR: My Lords, I beg to move the second Motion standing in my name.
Moved, That the Lord Champion be proposed to the House as a member of
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the Special Orders Committee in the place of the Lord Shepherd.—(Lord Merthyr.)
On Question, Motion agreed to.

CRIMINAL APPEAL BILL [H.L.]
2.50 p.m.
Order of the Day for the Third Reading read.
THE LORD CHANCELLOR: My Lords, I beg to move that this Bill be read a third time. Having already made two speeches in relation to this short Bill, I hope your Lordships will not expect me to speak at any length in moving this Motion.
I can claim that none of your Lordships who have spoken in the debates on this Bill have expressed any opposition to the proposal that the Court of Criminal Appeal should be given power to order a new trial. The only controversy that has arisen has been as to the extent of the power the Court should have. My Lords, I do not intend to repeat the arguments I put forward in Committee where your Lordships came to what I regard as a very satisfactory conclusion, albeit by a narrow margin, but there are three things that I should like to say.
The first is that while it may be true that the power this Bill gives will not be frequently used, none the less it may well prove to be an important power to use in particular cases, to secure that justice is done. Secondly, while some comment has been made on the present practice of the Court of Criminal Appeal with regard to the hearing of fresh evidence, it may be that if this Bill is enacted the Court will consider it desirable to review that practice having regard to the provisions of the Bill.
Thirdly, my noble and learned friend Lord Reid was very pessimistic about the prospect of another Bill extending the present one. One of his arguments, if I remember aright, was that if this Bill was passed it would be years before we had another Bill. My Lords, if this Bill failed to pass, I think it would be years before either of the two main Parties tried to give the Court power to order a new trial for if this Bill fails to pass both Parties will have failed

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in their endeavours to do so. But if this Bill passes, and public opinion, in the light of experience, changes; if the difficulties to which I referred in Committee are overcome, then it may be that, either in a Government Bill or in a Private Member's Bill, your Lordships will be asked to consider the matter again. I commend this Bill to your Lordships, and I beg to move that it be now read a third time.
Moved, That the Bill be now read 3a.—(The Lord Chancellor.)
On Question, Bill read 3a, and passed, and sent to the Commons.

DEFENCE (TRANSFER OF FUNCTIONS) BILL
2.52 p.m.
Order of the Day for the Second Reading read.
THE FIRST LORD OF THE ADMIRALTY (EARL JELLICOE): My Lords, last July, in Command Paper No. 2097, the Government announced their plans for re-moulding the Central Defence Organisation of this country. These plans included the establishment of a unified Ministry of Defence under a Secretary of State for Defence. This Bill, whose beauties I am to unveil to your Lordships this afternoon, is necessary to give effect to these plans.
Your Lordships will see that this is a short Bill and, as Bills go (and this is not saying a great deal), a simple one. Nevertheless, it is a Bill of historic significance, marking as it does the demise of great offices and Departments of State and the birth of new ones. I do not intend to linger too long in the past, as I believe we cannot afford the luxury of undue nostalgia when we have to grapple with the problems of national defence in this contemporary world. But I am myself in some small measure caught up in this particular wind of change. Indeed, my office and I are under sentence of death, as it were, by it. However, before mounting the scaffold of this Bill, I should just like to make it clear that no First Lord—and there are a number of former Naval persons in your Lordships' House this afternoon—has been prouder than I to hold this ancient office, possibly (we can never be
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too sure about these matters) as its last incumbent.
As my distinguished predecessor said in our debate last summer, the Admiralty and the Royal Navy have served this country over the centuries pretty well. One cannot but feel sad at the passing of such honourable offices whose roots lie deep in our history and, indeed, in our emotions. But, like my predecessor, I should not be supporting their abolition if I did not myself feel quite convinced that the time has come for a further step forward in our national central defence organisation.
We had a very constructive debate on the White Paper before the Summer Recess and your Lordships will not wish me to traverse all the same ground once again. Nevertheless, you may wish me, by way of background to this Bill, once more, quite briefly to summarise the main principles underlying the reorganisation and to mention the progress we are making in carrying out that reorganisation. The reasons why the Government had concluded that some further centralisation of control over defence policy and administration was necessary were explained in the debate last July. In essence, they are twofold. First, to facilitate the formulation of a truly integrated defence policy at the centre. Second, to improve our control of defence spending, particularly in the not inexpensive field of defence research and development.
The proposals embodied in this Bill rest, as I see it, on five main principles. This interesting animal, this Bill, therefore has five legs; it is a quinqueped or, for those of your Lordships who prefer Greek, a pentepod. The first leg, the first principle, is unification: a unified Ministry of Defence. The second principle is decentralisation. The new Ministry is so designed, or is intended to be so designed, as to promote decentralisation where decentralisation is both possible and needed, particularly in matters of day-to-day administration. The third principle is flexibility. The organisation must be flexible and capable of change, particularly where experience will enable us to pick out select areas in which the rationalisation of Service administration can, in our view, with advantage be carried further. Fourth, balance. We must keep a proper balance

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between the military, the administrative and the scientific components of the new organisation. Fifth—last but by no means least—Service loyalty. Despite this further integration in Whitehall, we are to retain three separate Services. We must therefore preserve the individual loyalties and traditions of the three Services themselves.
Finally, may I remind your Lordships that, for reasons which were explained more fully in the debate in July, the Ministry of Aviation is not to form part of the new unified Department, the Ministry of Defence. The Government consider that it should retain its separate identity; however—and the "however" is important—with much closer links with the central defence organisation than have existed in the past.
Based on these principles, the internal structure of the new Department will be as follows. The Secretary of State for Defence will have full control over and responsibility for the whole Department, a principle which your Lordships were not inclined to query last summer. The Secretary of State will be assisted by Ministers of Defence for the Royal Navy, the Army and the Royal Air Force, and they, in turn, will be assisted by three Under-Secretaries of State. The Ministers of Defence will be responsible to the Secretary of State for the administration of their Services and will also carry out any functional tasks which the Secretary of State may delegate to them over the defence field as a whole—a potential across-the-board functional responsibility to which my right honourable friend attaches considerable importance. In the White Paper it was proposed that the present Service Ministers should be replaced by Ministers of State. Some of your Lordships criticised this proposal last July as an undesirable downgrading of the former Service Ministers. This criticism, which was voiced both here and in another place, has convinced the Government that it would be right to appoint full Ministers, with the titles I have mentioned, and with somewhat larger salaries than those on which Ministers of State grow fat—or at least some do. If I may say so, as a not entirely disinterested party, I feel that the Government's decision in this respect, as in all others, has been wise.
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A Defence Council will be established under the chairmanship of the Secretary of State to consider major problems of defence policy, and to exercise the powers of command and control at present exercised by the Board of Admiralty and by the Army and Air Councils. The actual management of the Services will be delegated to Navy, Army and Air Force Boards of the Defence Council, and these bodies will remain responsible for the judicial and quasi-judicial functions of the present Board and Councils. The appropriate Minister of Defence will normally deputise for the Secretary of State, who will, of course, as is made clear in the White Paper, be the Chairman of each of these three Boards.
Below ministerial level there is a three-pronged structure—military, administrative and scientific. The military side of the organisation will be headed by the Chief of the Defence Staff and the Chiefs of Staff, who remain collectively responsible for professional military advice to the Government. The Chiefs of Staff, for their part, will continue to be the professional heads of their respective Services. The Naval, General and Air Staffs, and the Joint Service Staffs of the present Ministry of Defence, will together form the integrated Defence Staff. Certain changes are being made within this framework, and, where the nature of the work is suitable, full integration is planned in the future.
On the second prong, the Civil Administrative Staffs are to be headed by a Permanent Under-Secretary of State who will be assisted by four Second Permanent Under-Secretaries—one for each Service and one for the Defence Secretariat. The Defence Secretariat is a new organisation. It will bring together the Civil Administrative Staffs of the present Ministry of Defence and those of the present Service Departments who deal with major defence policy. These central staffs will form a single team with a direct line of responsibility to the Permanent Under-Secretary. We shall thus create at the centre new and much stronger machinery for the long-term financial planning of the defence programme as a whole. The detailed management of the money voted by Parliament will, however, be delegated—and I am sure that this is right—to the

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Second Permanent Under-Secretaries, who will be the accounting officers for their respective Votes.
THE EARL OF SWINTON: My Lords, before my noble friend passes from the financial side, may we get one point clear? As I understand it, on all military and other matters the three Service Ministers, who I am very glad have been upgraded, are going (if I may so put it) to run their individual Service Departments, subject to the broad control of the Minister of Defence. But when it comes to finance they are not, apparently, to have any real say in this: finance is to be the sole responsibility of the Minister of Defence and the civil servants working under him. Have I got it right?
EARL JELLICOE: My Lords, I think that my noble friend has forgotten one tier of this, and that is the Defence Council itself. Naturally, this scheme will have to be worked out in practice, but I was dealing here with the official structure. But, of course, major policy questions involving defence can be debated—and no doubt will be debated—by the Defence Boards of the respective Services and also by the Defence Council as a whole; so all four Ministers will have a full say—that is, the three ex-Service Ministers, if I may so term them, and the Secretary of State.
THE EARL OF SWINTON: My Lords, I do not want to be too tiresome, but I think the financial side is enormously important; because, after all, it is on the financial side that the Secretary of State for Defence and the Ministers are responsible to Parliament, and particularly to another place. On this question of finance, who is going to answer, first of all, for the broad financial policy? I imagine that the Secretary of State for Defence will take the overall responsibility for questions of major policy—I mean, on such broad questions as whether we should build cruisers or something else—but when it comes to all the detail, which is really where the money goes, and where Parliament and Parliamentary Committees have to watch the Administration, to whom are questions to be addressed on what I may call the individual application within the Services of the financial policy which has been settled by the Secretary of State and the Defence Council? Have
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such questions to be put to the Secretary of State, answering through, I am not quite clear who; or are they to be put to these Ministers of State? It is desirable that we should know this, and I imagine that the First Lord can give an answer.
EARL JELLICOE: My Lords, I hope that the First Lord can answer my noble friend's question. In the first place, I entirely agree with him that this is a matter of prime importance here. My answer is basically two-fold—and I think I have this right: that the responsibility to Parliament over the whole field is vested, and will be vested, in the Secretary of State for Defence—and that includes, of course, the financial responsibility. So far as particular questions impinging on the finances of particular Services are concerned, the correct procedure, as it were, will be for questions to be addressed to the Secretary of State for Defence. But (and I think he made this clear himself, in an answer during the Committee stage in another place) the practice will be followed here that, unless such questions involve major issues of policy, it will normally be the Minister of Defence associated with, and responsible for, the day-to-day management of a particular Service who will answer any question relating to that Service.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, I take it that, under this machinery, the new Ministers of Defence for Service Departments will have under them a Permanent Secretary to the Department and an Under-Secretary to the Department who will in fact have to do all the groundwork and the preparation for discussions in the Defence Council which is to be set up, and will be responsible for all the details of their Service Departments. But then, apparently, they can be overruled, I suppose by a Treasury-nominated Under-Secretary to the Minister of Defence, without that man having been integrated into the day-to-day work of the Service Department.
EARL JELLICOE: My Lords, I think I can assure the noble Earl the Leader of the Opposition that, as I have mentioned, in the case of each of the Services, there will not be a Service Department, but there will be a Permanent

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Under-Secretary who will be called the Second Permanent Under-Secretary. There will, in fact, be four Permanent Under-Secretaries—one attached to the Ministry of Defence, as I have mentioned, under the Permanent Under-Secretary, and one dealing with each of the three Services. As the, noble Earl will see from the White Paper, the whole idea is that at an early stage the long-term programming of these financial programmes should be brought together, but in that bringing together each of the Services will be represented in the formulation of policy at that stage.
EARL ALEXANDER OF HILLSBOROUGH: It seems quite clear to ordinary Ministers of experience that these staffing arrangements will bring about a duplication and an increase in administrative costs. Instead of this arrangement being likely to bring about a saving, it seems to me that it will cause an increase in expenditure.
EARL JELLICOE: With great deference to the noble Earl—and he speaks with very considerable experience in these matters—I should have thought (and it seems to me that experience in the past tends to support this) that there was a great deal to be said for bringing together the major programming of the defence policies of all three Services at as early a stage as possible. I should have thought that in that way lie saving and economy, rather than the reverse. Certainly, in that way lie true interdependence and a true meshing together of the requirements of the three Services.
LORD SHACKLETON: My Lords, I am sorry to interrupt the noble Earl, but I have forgotten what he said before this exchange, and it would be rather helpful if he could repeat the two passages dealing with the position of the Second Permanent Under-Secretary, because I am trying to see how closely it follows the White Paper. It was that passage which gave rise to our concern, and it might be helpful if we could have the actual text again.
EARL JELLICOE: I am in rather the same state as the noble Lord. I also have tended to forget what I had said shortly before our interesting exchanges in these esoteric spheres of finance. But I have here what are called
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"comprehensive notes", and I think I can give the noble Lord the precise phraseology I used and I will repeat the passage. The civil defence staffs are headed by a Permanent Under-Secretary of State who will be assisted by four Second Permanent Under-Secretaries one for each Service, and for the Defence Secretariat. The Defence Secretariat is a new organisation. It will bring together the civil administrative staffs of the present Ministry of Defence and those of the present Service Departments who deal with major defence policy. These central staffs will form a single team with a direct line of responsibility to the Permanent Under-Secretary. We shall thus create at the centre new and much stronger machinery for the longterm financial planning of the defence programme. The detailed management of the money voted by Parliament will, however, be delegated—and I am sure this is right—to the Second Permanent Under-Secretaries who will be the accounting officers for their respective Votes. That was what I said. I am completely confident—and I know the precise wording of the White Paper will be familiar to the noble Lord—that this is not in any way a contradiction of the White Paper proposals. It is just a "fleshing-out" of those proposals.
My Lords, may I turn now to the scientific field. The Chief Scientific Adviser will be in charge of all scientific effort in the new Department and a number of changes are being made in the scientific Committee structure described in order to improve the control of defence research and weapon development. Those changes are outlined in Section X of the White Paper. To mark the increasing rôle which science plays in the Services, the chief scientists of the three Services are to become members of their respective Service Boards; and I am sure this is a good innovation.
So much for the broad outline of the new defence set-up. Provided that Parliament passes this Bill the Government intend to bring the new organisation into effect on April 1 this year. These changes may sound simple, but they have meant, and mean, much work. Let me give but one example: the physical co-ordination and bringing together of the Central Defence Staffs. It is clearly a good thing, in my belief,

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to bring together under one roof the staffs mainly concerned with Defence policy: that is, the Defence staff, the Defence Secretariat, the defence scientific staff, together with those elements of the managements staffs of the Services who are most closely associated with them.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, may I ask a question on the timing, about this date of April 1? Are we to understand that we shall be getting the usual Defence White Paper before that date for the coming armaments year, or shall we have to wait until after the new Department has been organised?
EARL JELLICOE: No, my Lords. I can assure the noble Earl straight away that the normal Defence White Paper will be appearing at about the normal time.
It has also been decided—and I am sure advantage will flow from this, too—to house under this same roof the Minister of Aviation and the principal officers of his Department concerned with research and development. This cohabitation will, I am sure, make for much better co-operation. I might perhaps mention that the building selected for the honour of housing this large but happy family is to be the one in Whitehall which the Board of Trade and the Air Ministry have hitherto shared. It will hold about 3,400 out of a total of about 25,000 staff which the new Department will possess on its formation. Very good progress has been made with all this and I am confident that occupation of what we intend to call the Whitehall main building of the new Ministry will begin by vesting day.
If the new Department is to function efficiently when it comes into being on April 1, it is essential that as many as possible of the features of the new organisation should be progressively introduced before that date. Good progress is being made in this respect, too. The defence operations executive has been formed and the Assistant Chief of Defence Staff (Operational Requirements) and his staff have begun work. We have appointed the Second Permanent Under-Secretary of State (Defence Secretariat)
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and the Deputy Under-Secretary of State for Programmes and Budget. On the scientific side, the Weapons Development Committee and the Defence Research Committee have been set up. Arrangements are also being made to appoint the additional scientific staffs required to service these Committees and carry out the other tasks mentioned in the White Paper. In short, anything that can be done before April 1 is being done. However, there are some things which cannot be done in advance and which will have to wait until the actual physical reorganisation takes place.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, if there is going to be a general staff plus these extra 25,000 in the Ministry of Defence, will all these changes be accounted for in the Estimates for the Financial Year beginning April 1? This seems to me an extraordinary thing. Can we have a complete comparison in the Estimates between the cost now and what it is going to be?
EARL JELLICOE: My Lords, I cannot promise the noble Earl that we can meet the second requirement; but I can assure him that these matters will be costed in the Estimates. I think I should make it quite clear that, taking the present staffs as on April 1, 1963, of the Ministry of Defence, the Admiralty, the Air Ministry and the War Office, the staffs of the new combined Ministry of Defence as on April 1, 1964, will be no more. The figure of 25,000 does not represent a net increase. Perhaps I was unwittingly misleading the noble Earl. There will be no increase. It is merely a bringing together of staffs.
Now, my Lords, for the Bill itself. It is important to appreciate what it does and what it does not do. What it does is to reallocate the statutory powers now reposing in the Service Ministries. It is not concerned with prerogative powers under which many of the activities of the Service Departments are carried out. Nor is it concerned with the details of the reorganisation, the transfers of staffs, the alterations in lines of responsibility, the provision of accommodation and all the thousand and one other matters of administration which do not require legislation. The Bill is thus only part of the process necessary to set up a unified Ministry of Defence.

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The other formal step is the appointment by Her Majesty of a Secretary of State for Defence and the establishment under the Royal Prerogative of a Defence Council and Navy, Army and Air Force Boards. Clause 1 of the Bill makes it clear that the proposed legislation is dependent on Her Majesty's being pleased to make such arrangements. The Bill does not therefore trench on the Prerogative; indeed, there is a specific saving to this effect in Clause 4(3). However, Her Majesty has been informed of the contents of the Bill and has been graciously pleased to indicate that she will in due course be prepared to make the necessary arrangements under Prerogative powers.
The offices of the First Lord of the Admiralty and of the Secretaries of State for War and Air, together with the Board of Admiralty and the Army and Air Councils, will disappear. It is therefore necessary to transfer the statutory powers vested in them to the new office of Secretary of State for Defence and to the Defence Council. This is done by Clause 1. The allocation of functions between the two new authorities is explained in paragraph 2 of the Memorandum attached to the Bill before your Lordships' House. It will be seen that this perpetuates the division of powers between Ministers and Councils which exists to-day. Thus, powers now exercised by the Secretaries of State for War and Air are transferred to the Secretary of State for Defence. Powers exercised by the Army and Air Councils are in their turn transferred to the Defence Council. The statutory powers of the Admiralty are allocated to make a broadly similar division.
Clause 1(5) deals with the relationship between the Defence Council and the three Service Boards. It provides that, subject to any directions of the Defence Council, the Navy, Army and Air Force Boards will be able to discharge finally—and that is the important word here—any statutory function of the Defence Council. As explained in the White Paper, the Defence Council will deal mainly with major defence policy and the Service Boards for the most part with matters of management. The composition of these bodies reflects this distinction. The Defence Council may be the appropriate body to discharge certain
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statutory functions or to discharge a function in relation to a particular class of cases. Again, in certain cases it may be appropriate for the Defence Council to direct that a particular Board should exercise a function only in relation to the members of the corresponding Service. This is the significance of the words, "subject to any directions of the Defence Council".
But many of the statutory functions are, of course, concerned purely with management, and it will be appropriate, and it is the Government's intention, that these should be discharged finally by the Service Boards. Anything done by the Boards in these cases will have the same legal effect as if done by the Defence Council and will not be subject to review by the Council. This is what "finally"—the word I have somewhat laboured—means in this context. This applies particularly to judicial and quasi-judicial powers for the review of disciplinary awards, the redress of grievances and the like. I am sure that the House will agree that it would be wrong to interfere in any way with the long-established practice whereby petitions against the findings and sentences of courts martial, for instance, are received and dealt with within the Service to which the accused person belongs. That said, I should like to make it clear—and this is the point I made in reply to the question of my noble friend Lord Swinton—that the Secretary of State for Defence, who will be Chairman of the Defence Council and of the Service Boards, will be responsible to Parliament for all the business transacted by the Council and the Boards.
I believe that these are sensible and practical arrangements, which permit the flexibility and the scope for organic growth and change which it is necessary to build into any radical reorganisation of a machine as complex as the one which we are reorganising under this Bill and White Paper.
The remaining clauses of the Bill I think I can deal with very briefly. Clause 2 transfers to the Secretary of State for Defence all Service property, rights and liabilities, and provides for the acquisition and use of land. Clause 3 contains consequential and transitional provisions, and Clause 4 explains itself. To sum up, this is a technical Bill, which

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is needed if we are to abolish, as the White Paper has proposed and as I think your Lordships' House broadly endorsed last July, the existing Service Ministers and Ministries and to create an integrated and unified Ministry of Defence. What it does, in a few words, is to transfer existing powers from the old order to the proposed new order.
I think it fair to say that, whilst the proposals for this new set-up were not received with rapture by your Lordships last July, they were, broadly speaking, endorsed as necessary, sound and sensible. This broad endorsement has been confirmed, by all Parties, during the passage of this Bill through another place. Because of this, and because I, too, believe these proposals to be right, can commend this Bill to your Lordships with confidence. I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Earl Jellicoe.)
3.25 p.m.
LORD SHACKLETON: My Lords, I cannot recall a more difficult subject or a more difficult speech to which to reply. The noble Earl said that this is a technical Bill which provides for flexibility and organic growth. I really do not know what any of those words mean in this context. This is a small enabling Bill. It is certainly difficult to understand, but it is nothing like so difficult to understand as the proposals (if they are proposals) that the Government are putting forward with regard to the reorganisation of defence.
I must say straight away that we shall have to read the noble Earl's speech very carefully and possibly return to the discussion of some of these matters, not perhaps by way of Amendment, but at least on "clause stand part" on Committee stage. I am not making a Party point when I say that the whole House finds it extremely difficult to follow this set of propositions. The special difficulty rests in relation to the responsibilities involved. Here I would ask the Minister a number of questions. Frankly, I do not think he told us anything that was not said by the Minister in our last debate six months ago or was not proposed in the White Paper, with one exception—his reference to the new Ministers of Defence.
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I think we ought not to pass this Bill without asking why the Government have introduced it. We know that it is due to admitted failure. This is apparent in the White Paper and has been apparent in the speeches on the previous system. But what we are not clear about is whether it is the system that has failed, or the men. I am sure that the Government are tired of references made to the number of Defence Ministers, but there really has been a frivolity on this subject, and there is no question that whatever is proposed now will work no better unless there is some continuity and the right occupant of the post of Secretary of State for Defence. I think that that is obvious.
It is also clear that these changes have had bad effects, and among these bad effects has been that it exacerbates the Party political side of the defence issue, which I hope may be reduced. I am a little bothered now by the smugness of the Government in regard to their proposals. They have created a framework, one that is difficult for us to follow, and apparently they are reasonably certain that their proposals are going to work. Again, this is exceedingly difficult for us to discuss without a great deal more information. Indeed, I am wondering whether this is not an example of those highly technical problems that are very difficult to debate across the Floor of the House—whether this is not the sort of thing that needs to be examined much more thoroughly by a smaller number of people, so that in the process they can clear their minds and understand exactly what it is that the Government have in mind.
The first big question, on which I do not believe that noble Lords on either side of the House are clear in their minds, is the position of the Ministers of Defence for the Navy, Army and Air Force. It is rather difficult to remember their proper titles, but I think these are correct. I am sure we all welcome the fact that they are to be full Ministers, but I am astounded at the rather curious idea that in order to preserve the right relationship between them and the Secretary of State for Defence they have to be paid less. This seems to me the most extraordinary thing. Have the Government really thought what they are saying in this? We have sometimes had other Departments which have had

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more than one Cabinet Minister in the same Department, and there has been no question about who was "the boss". But this sudden introduction of a status determined by pay in relation to Ministers, all of whom we know are grossly underpaid, is really too ridiculous. I would urge the First Lord to talk to his right honourable friend and to get him to reconsider this curious emphasis, that of course they must be paid less. Is he afraid that if they are all paid equally they will be "uppish"? I find it extremely difficult to take the Government seriously when they make this sort of proposal.
This, however, is a small point. The real point in regard to the power of Ministers is how far they are to be responsible to Parliament. The noble Earl made it quite clear that, in the last resort, it will be the Secretary of State himself who will be responsible. But difficulty arises in regard to this question of discipline, because it has been made clear by the noble Earl that discipline is the responsibility of the respective Boards. This is one of the matters which it is intended should be decentralised to them—and by "decentralised" is meant, I suppose, that there will be a moment when responsibility is taken away and hastily thrust back to them. But there will still be the ultimate issue when a Minister comes to Parliament. At this point, will the Minister of Defence, if he is in this House, always have to refer to "My right honourable friend"?—it may be that the Secretary of State for Defence is not likely to be often in this House. Will the Minister of Defence for the Navy ever answer for himself, or will it always be on behalf of the Secretary of State? This matter is important in regard to the public responsibility.
I am not saying that what the Government are doing in this matter is wrong; I am merely pointing to the difficulties. The strength of the present position is that when the First Lord gets up to speak we know that, unless the matter under discussion is to go to the Cabinet and the Prime Minister, so far as his particular field, his Department, is concerned, the final word has been spoken and he speaks with that authority. This will not be so in the future.
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The matter is further confused, because we have been told that the Ministers of Defence will have certain functional responsibilities across the whole field of defence. If that is the Government's intention, they presumably must have some idea of the sort of functional responsibilities which these Ministers will have; because otherwise they would not have mentioned them. But they have not yet told us what they might do. Perhaps, when the noble Earl comes to reply, he will tell us what particular other functions they will have.
We should also like to know how far these functions will be satisfactorily separated from the Minister's major responsibility in regard to a particular Service. We are quite accustomed to a Minister going off and doing an odd job somewhere. We sent the Minister of Science to Moscow; and I remember that after the war the Secretary of State for Air was frequently involved in negotiations abroad for the Government. All that is understandable. But these seem to be definite responsibilities and functions. It is important, if we are to judge this, that we should be told just the sort of thing these Ministers will do.
There was, too, the particular point raised by the noble Earl, Lord Swinton. Here I think we are in some difficulty in understanding what the Government have in mind. I think the view held by those who support a greater measure of integration in defence of this kind has generally been that there should be central control over estimating and budgeting—and, indeed, over expenditure. But if what the noble Earl said is correct, it would seem that this process will be conducted within the Secretariat, without reference to the political Ministers, until it emerges at the top—until, in fact, it comes out to the Defence Council. What is to be the precise relationship between the three Boards and the officials who are responsible for this budgeting and estimating?
It may be that this is too detailed a matter for us to discuss effectively in this House; but the noble Earl sought to explain it. It is quite fundamental, because if the Minister of Defence for the Navy has no direct influence in this matter (it may be that this is one of the functions that will be devolved to him; I do not know) and the channel is through the various Permanent Under-

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Secretaries, one can see that a degree of frustration may build up which will make this pentepod, as the noble Earl calls it (it sounds much worse than the Pentagon: this will indicate to the noble Earl that his joke did not go unnoticed) a much more frustrated place.
This may also affect the question of debates in the House. I think I am reasonably clear that any Minister is liable to answer a particular question; and that does not worry us quite so much in this House, where Ministers are thinner on the ground and we know they may have to speak for Departments other than their own. But when the Estimates are produced, will there be a combined statement? Certainly previously we were told that there would be separate Votes for each Service. I hope that the Government will produce something rather better in the way of a Defence White Paper than they did last year, and something which will enable us to understand more how this is going to work. I personally have no objection to our having debates on subjects other than on the individual Services: indeed, last year, if there had been time, it was quite likely that we should have anticipated what has been suggested in another place—namely, that debates might take place other than on a single Service. There is still the responsibility of Parliament for this type of Supply, and it is desirable and necessary to know how it is to be presented.
One thing is quite certain, and that is that the Secretary of State for Defence is going to be an extremely overworked man; he will be as hard-worked as the Foreign Secretary or the present Commonwealth Relations Secretary. Although this federal type of Ministry may be the right solution, it carries enormous dangers, because it puts the man at the top and responsible to Parliament even further away from the field in which he is exercising responsibility. It will be impossible for him to do what the First Lord is able to do to-day, and on his own authority. That creates serious problems.
Clearly we are not going to oppose this measure to-day, but this is something very much in the nature of an experiment, and it is one that I do not think is likely to remain unchanged in the future. There has been some argu-
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ment in favour of strengthening the position of the Secretary of State. There was an interesting suggestion from the noble Earl, Lord Swinton, that there might be a sort of Chief Secretary. This was turned down when it was put forward in another place, again on the grounds that we cannot have two Cabinet Ministers. This is nonsense comparable to the argument on pay relativities.
I am not saying that this suggestion is right, but I do not know whether it has ever been seriously considered. Certainly considered arguments have not been put forward against it, and I think it is a matter which ought to be at least considered. We have had very little discussion on the position of the Chiefs of Staff and the Chief of the Defence Staff. There has been quite serious criticism from all sides in regard to the position of the Chief of the Defence Staff. I should again like to ask what I asked on the last occasion, a question to which I did not get an answer: How far will the Secretary of State for Defence himself deal directly with, and, if necessary, take the chair at meetings of, the Chiefs of Staff? Or will disagreement at the Chiefs of Staff Committee always come to the Secretary of State for Defence? When I say "always", obviously there will be direct contacts. Will the channel normally be, as is suggested, through the Chief of the Defence Staff? This seems to me to be a bad and retrograde step, and I think it is important to know how this is going to work.
At this point, I realise that I am getting into such a rarified atmosphere that I ought to sit down and leave this to my noble friends Lord Attlee and Lord Alexander of Hillsborough, who have such wide experience of the operation of the higher organisation of Defence, both in war and in peace time. I would suggest that to some extent this is a problem of power, and those of your Lordships who have served in the headquarters of powerful commands will know that there is a danger that this particular command will develop a power and an identity which may greatly influence defence planning and defence organisation. Getting rid of the heads of the three Services does not mean that powerful interests of a kind which already exist may not still continue. But

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they will be under less control than they have been in the past. I would suggest that, in this relationship and in this conflict of power, the Government have not necessarily solved their problem, and may well have created new problems for themselves.
Finally, I should like to refer lightly to the relationship of the Defence Council to the Cabinet, and to the Committee on Overseas Policy and Defence. It has been a criticism—and it is a criticism I should like to repeat to-day, and one which has come from many people, including certain people with wide experience in the Services—that there is apparently to be no permanent secretariat to the Committee on Overseas Policy and Defence. We know that a suggestion was made that there should be a secretariat, and that it will be served by a committee of senior officials. But it is clearly in this field that the greatest weakness has been shown in recent years. It is in the relation of defence expenditure, foreign policy and economics that we have fallen down and overstrained ourselves. There can be no argument to-day that we are seeking to achieve more economically than we can achieve; and the co-ordination between defence, foreign policy and economic considerations is, I should have thought, unquestionably not as satisfactory as it should be. This is the most vital point of all, and the danger that some of us feel in regard to these proposals is that in the process of abolishing the three fortresses of the Air Ministry, Admiralty and the War Office, the Government have created an even stronger bastion which will pursue a policy of independence with its own cabinet, the Defence Council, and which may to that extent produce less co-ordination rather than more.
There are obviously many details one could discuss in regard to this Bill. There are certain aspects that are wholly welcome. I think the development in regard to the scientific advisers and that particular structure is certainly, on the face of it, to be strongly commended. But whether, even then, we shall succeed in getting an adequate degree of co-ordination in budgetary and other matters with regard to new projects is difficult to tell. It is here that time and again our defence policy breaks down. There is a potent phrase in the White
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Paper in regard to research, where it says:
"The problems of Defence research are seldom amenable to straightforward analysis and accounting."
This is no doubt one of the truest statements that has ever been made. Although there is another Committee, the Weapons Development Committee, which is intended to exercise this control, from what we have heard there are no indications that we are likely to do any better than we have done in the past. It is clear that to do so is the intention, and will be one of the main justifications for this measure. Until we bring these enormously expensive items under control we shall continue to waste money. I am not seeking to make a Party political point when I say that it is clearly a disaster that we have had to cancel Blue Water, or when the cost of Seaslug or TSR 2 goes ten or even twenty times above the original estimate. Somehow this new machine must bring this under control, because whatever Government are in power, they will be in continuous difficulty because their estimating will be without any reality at all. I hesitate to say that a Dr. Beeching might do better in this matter, but clearly something must be done, and I wish I had more confidence that this proposal would solve these problems.
I think the main difficulty we have in considering this matter is the extent to which we still suffer from the domination of certain words. I should like to make a plea that, in regard to purely honorific titles with an historic meaning, we should stop worrying as much as we have done. Would it really matter if the Navy Board of the Ministry of Defence, which is the N.B.D.C.—a really absurd title—were still called the Board of Admiralty? I think this would be very welcome. We realise that certain of these terms must continue, and I know it is arguable that there was as much feeling when the title "Navy Board" was abolished a long time ago, but surely we could get over that. I should have thought we need not worry about that type of name. What is more serious is the fact that, in this plan and in this thinking, none of us seems able to free himself from misconceptions.
I should just like to refer to one particular phrase which was used by the noble Lord, Lord Carrington, when he

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spoke in the debate on the White Paper. He said [OFFICIAL REPORT, Vol. 252 (No. 126), col. 1161]:
"Sailors are sailors; soldiers are soldiers, and airmen are airmen: they choose their ship; they choose their regiment, and they choose their squadron."
I think it would be difficult to find a single sentence which contained more misconceptions than that. I suggest that possibly the reason he thought like that is that he was a soldier—perhaps a more orthodox soldier than the noble Earl, Lord Jellicoe. Sailors are frequently airmen; airmen do not choose their squadron.
If this is the level of thinking—and I do not believe it is—we are not going to get very far. It will be the men who will make this particular proposition work. I have a good deal of faith in the noble Earl himself and, indeed, in his predecessor, but I have very little faith in the Government; and if, to use that very eloquent phrase that my noble friend Lord Attlee used on a previous occasion, the Ministry of Defence is to be a siding into which politicians on their way up or down will be shunted, this Bill will do little to improve our situation.
3.52 p.m.
LORD OGMORE: My Lords, I welcome this Bill in principle, and, for my part, I wonder why it was not introduced long ago. So far from being a revolutionary measure, it is, in my view, a highly belated one. I was reading only the other day that even the old Duke of Cambridge, who ceased to be Commander-in-Chief some eighty years ago, felt that there was need for a Ministry of Defence. He was no radical reformer, and I never thought I should be quoting the Duke of Cambridge in support of any of his military ideas; but if he thought it was a good idea, one can see that Her Majesty's Government, bringing along a measure like this in the year 1964, are not doing anything which is highly revolutionary.
In view of the fact that Britain is an island and that every operation of war, and most operations of peace, have to be combined operations, it is odd that for so long we have managed to struggle along with three distinct Services, very little co-ordination and hardly any integration. I am not at all sure that we
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do not need to have a good deal more than is proposed in this measure and in the White Paper which lies behind it. I have some sympathy with the noble Lord, Lord Shackleton, when he says that to discuss a question like this in a debate in a House of Parliament is almost impossible. The Bill itself is very short; it is an enabling measure; it gives very little detail—and it is the detail which matters. I feel that this is another reason why we shall have to develop Parliamentary machinery and proceedings of Parliament to deal with modern conditions. I think the time has come for a Defence Committee of the House which can go into these questions.
It so happens that I know far more about details of NATO forces than I do about those of my own country. The noble Earl, Lord Jellicoe, knows that this is so, because he was at the NATO Parliamentarians' Conference before he ascended, or descended, to the Front Bench. There we have talks by the Supreme Commander and by various other naval, air or military commanders in NATO. One asks them questions in the Committee or in the plenary and one can thereby find out a great deal of the detail of what one wants to know about these matters. Members of Parliament, however, have little opportunity of getting details. The whole subject is shrouded in secrecy, most of which is entirely unnecessary, for I am certain that the Russians know far more than any Member of Parliament does about what goes on in our Forces. We are not really able to do our duty in this respect. If we had a Committee in this House we should be able to have before us and discuss these matters with Ministers, Chiefs of Staff and other people as we do in NATO, and we should get a fairly accurate estimation of what the health of the Services is like and what the proposals are intended to mean.
I hope that with this new set-up, as the noble Lord, Lord Shackleton, has said, we shall not have all this whirligig. "Stop-and-Go" defence policy that we have had over the last eight or ten years, when one Minister of Defence comes in and decides to do away with the Royal Air Force and a good deal of the Fleet and concentrate on rockets, and then another one comes in and decides to "pipe down" on rockets and try to

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build up an R.A.F. again, and so on. How on earth people in these Services have managed over the last ten years to carry on in staff colleges and other training establishments where they are supposed to teach what is Government policy on these matters and forecast what the future of the Services is going to be over the next few years I cannot understand. We ourselves here, having the advantage of speeches from Ministers responsible in the Defence Departments, have not known what the real intentions of the Government have been; they have changed so often.
I think the danger here is that a vast bureaucracy will be built up. I hope the Government will avoid that and avoid empire-building, and have as few people as possible. But let them be good people. Here I support the noble Lord, Lord Shackleton. I think it is absolute nonsense to cut down the salaries of the various Defence Ministers. Ministers, in my view, are paid far too little as it is. The position is nonsensical when Cabinet Ministers are paid considerably less than their own permanent Departmental heads, particularly when these Departmental heads have pension rights as well. I think that to cut down salaries is very much a retrograde step. I suggest that what we should do is to maintain the salaries at the present level and put up the salary of the Secretary of State for Defence. I think the public would understand that.
One reason why I think this action is belated is because we are now entering, and have entered over the last two or three months, a completely new phase of defence in the Commonwealth. Few contemplated that this would be so, but I would remind your Lordships that when I was speaking in this House on the measures proposed in the White Paper I said [OFFICIAL REPORT, Vol. 252 (No. 126), col. 1156]:
"I think that in future we shall have to give much closer attention to Commonwealth defence than in the past. It is going to be a rather different type of defence."
I then went on to say:
"I refer to a case such as that in Borneo, the new Malaysia. It will be quite impossible for the new Malaysia to defend its frontiers, those enormously long frontiers running through bush and across the tops of mountains … without aid from the rest of the Commonwealth."
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I never thought my forecast would come so quickly into being. It was not long before there was the attack from Indonesia in the very region I specified to your Lordships last July.
I feel that the situation that has arisen, not only in Malaysia but also in East Africa, means that we have to look at defence from a completely new point of view. We have to be ready at very short notice to go to various countries scattered all over the world in order to handle a situation that may arise. I should like to ask the noble Earl these questions. Will it be possible to adapt the proposed set-up in the Ministry of Defence to meet these new situations? Can the Government provide quickly enough the necessary forces at a few hours' notice to take off and go to various parts of the world? I myself believe that if this tendency continues—and I think it will continue; I think we shall have to go into a lot more countries to assist them with internal defence either because of Communist infiltration or for some other reason—it is going to be pretty well impossible for Britain to carry this load herself. I think we shall be highly overstrained, when one regards the fact that we have to provide forces for NATO and we have other commitments in various parts of the world of a more or less static nature. To underwrite these various other commitments which may arise from time to time will overstrain us.
I suggest that the Government try to get a Commonwealth defence force; that is, not one on a permanent basis but a Commonwealth defence pool to which the various Commonwealth countries, such as Canada, Australia, New Zealand and the rest, would earmark contributions, and when some of these difficulties arise we could draw on that pool and get some assistance. I do not think anyone can say Canada has done very much; they have not provided very many forces outside Canada, except to NATO, since the last war. There is one precedent we have got and that is in the case of Korea; for the first time in history a Commonwealth Division was quickly gathered together and went to Korea. I have been disappointed that that sort of precedent has not been followed, but I think to-day that this is in all probability going to be, so to speak,

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the pattern of the future. Quite likely we shall never see great land wars in the future such as we have seen in the past, but this sort of commitment will be a very common one, and I feel that the Commonwealth, rather than NATO, is the type of organisation which should be dealing with the Commonwealth commitments which I have described.
I also think that in the present circumstances it is quite impossible to get the United Nations into these areas. In times to come they may have a permanent force, but they have not got a permanent force at the moment. I think it is far better for the Commonwealth itself to handle the situation for Commonwealth countries. That is all I have to say on this particular Bill. As I have said, I welcome it. I think it is a highly inadequate discussion we are having to-day, but that is not the fault of the Minister or the fault of those taking part, but is due to the fact that the procedure of Parliament is just as much behind the times as the structure of the Forces has been until quite recently.
4.4 p.m.
LORD TEYNHAM: My Lords, I entirely agree with the views of the noble Lord who has just spoken that one must have some continuity in defence, but I suggest to the noble Lord he must not forget there have been great changes in weapons owing to the rapid advances in science over the last few years which make changes in defence policy very necessary. This Bill is, of course, a radical departure from our present organisation, and it places political control in one hand instead of four hands. What we are really doing is to create a post of a superman with immense powers. Although I am in favour of some form of centralised control, I do hope that this centralisation will not be carried too far, which may very well in the end slow up decisions. We have seen that happen with the German High Command in the last war, which I think was known as OKW; it undoubtedly had a very serious effect on the naval warfare of the German navy and they would have done far better without OKW control.
I also think that many difficulties may arise with weak Ministers of Defence.
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They are not all going to be supermen. The superman, I understand, is to be known as Secretary of State for Defence, but what of the other Ministers of Defence? In another place a good deal of debate went on as to what these Ministers are to be called and what should be their precise rôles. I understand the Minister of Defence decided he would look at the whole matter again as regards the title of these Ministers, and I think the noble Earl, Lord Jellicoe, has said they are to be called Ministers of Defence. I also understand that it has been agreed that Ministers of State would be upgraded to full Ministers of Cabinet rank. I certainly agree with this proposal. Otherwise the burden on the Secretary of State would be far too heavy to bear.
These Ministers of State, I believe, are not to be in charge of Departments, because I think the intention is to have one Department of Defence. This sounds very nice and tidy on paper, but perhaps the Minister in charge of the Bill could explain more fully how this is to be put into practice. Are they to jump from one Department to another? I really cannot see the use of these Ministers if they are to have no authority at all in their own Departments. What about conflicting claims in one Service? Is the Minister of State to have no power to decide between rival claims in the same Service? I simply do not understand this. What would be the position of the Minister in discussions with our Allies on the navy's rôle in certain areas? Would he have to say that he could not deal with it and must get a decision from the Secretary of State for Defence? We really must have something more definite about these very important matters which are bound to arise. It seems to me this debate is being held in a vacuum, because we know very little.
I am also very concerned about the term "Navy Board" which is to supersede the term, "Admiralty." It is so easy to discard the old name, to throw it away; but how many years will it take to build up a new one? It is true that the term "Navy Board" has been used before, but not, I venture to say, with any great success. The Navy Board system broke down when put to the test during the Crimean War. Why revive it? I maintain that we should not interfere more than is absolutely necessary

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with the traditions of the Naval service, which go far back into the mists of time, long before the Navy Board was set up.
I wonder how many of your Lordships are aware that the word "Admiralty" was used in a collective term for the office of Lord High Admiral, I think very early in the 15th century. In fact the word "Admiralty" goes back many centuries before that date and is derived from the Arabic word "Amir-al-mar". Surely it is not proposed that Admiralty Charts—a hallmark of quality—will in the future be known as "Navy Board Charts." Then we have the Admiralty Manual of Navigation, Admiralty House and Admiralty Arch. Is it seriously proposed that all these time-honoured names should be done away with? Before long we shall have someone re-writing the Gilbert and Sullivan operettas. I cannot imagine a seaman referring to an Admiralty anchor as a Navy Board anchor. To me it sounds complete rubbish. And what about the Admiralty Division of the High Court of Justice. Is this to be changed, too?
There is, of course, a very much more serious vein underlying these proposed changes. I suggest that we must guard against the tendency of organisers to forget the greatly different roots and deep traditions of the Armed Services; and I would say that this applies particularly to the Royal Navy. The term "Admiralty" has for many centuries been a collective term for royal authority vested in the office of Lord High Admiral. This was the case whether the Lord High Admiral was an individual—as of course he was for very many years—or whether the office went into Commission as Lords of Admiralty. Throughout, the Royal authority has been maintained; and with Her Majesty resuming the office of Lord High Admiral there will be a continuity of the Royal authority exercised through the collective term "Admiralty," now to be changed, for no apparent reason, to "Navy Board."
I would point out that there is a fundamental difference between the Navy and the other Armed Forces. The fact is that, unless the Army and Air Force Acts were passed each year, the Army and the Air Force would become illegal bodies of armed men. That does not apply to the Royal Navy. A soldier
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has his loyalty to his regiment, although I believe there are those in certain quarters who would like the regimental system to disappear and be replaced by a corps of infantry. In the Navy, the advent of short-service commissions, nowadays of only some 18 months, means that it is becoming more difficult to build up a similar loyalty to a unit, such as one of Her Majesty's ships. I maintain that something higher is required which the sailor can always look up to as a focus for his loyalty, and this must be the Admiralty. Those of your Lordships who have served in the Navy would, I am sure, be interested to hear from Her Majesty's Government what in the future will be the disciplinary term for the time-honoured phrase "incurring their Lordships' displeasure."
I can see no reason why the Services should not be allowed to retain their present names if desired, especially in the case of the Royal Navy, on account of the arguments that I have done my best to put forward this afternoon. I cannot possibly think that it would interfere with Her Majesty's Government's idea of integration. I am glad I have the support of the noble Lord, Lord Shackleton, on this point. These matters are part of the traditions of the Services which it is perhaps difficult to explain. None the less, they exist, with an enormously strong influence. I do not see why we should follow the United States organisations in everything we do. For heaven's sake! let us have some originality. I trust that Her Majesty's Government will think again about the matters that I have raised, and will consider the request about which the Navy feels so strongly.
4.12 p.m.
EARL ATTLEE: My Lords, I strongly agree with the noble Lord, Lord Teynham. I cannot see why you should scrap whole phrases like "the Admiralty" for something new-fangled, especially if it comes from the Pentagon. I do not know whether the new organisation to which the noble Earl gave a Greek name was sired or dammed by the Pentagon, but the last thing in the world which I should like to follow is co-ordination or, for that matter, for control by Ministers. I have risen because I have taken some interest in this matter for a number of years—in fact

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ever since my noble friend Lord Lawson and I entered the War Office just forty years ago; and while I am entirely in favour of co-ordination between the Services I am not at all sure that this is the right way. Fundamentally, what is required for co-ordination is the training of officers who think in terms of all three Services. That is much more important than any machinery.
The machinery we evolved during the War worked well. I would call it "trinitarian" rather than "unitarian". We had three Chiefs of Staff, and we had a Minister of Defence and a Defence Committee, and it worked well. We continued with that system during the time of the Government of which I was Prime Minister, and it worked quite well. In fact, the proof of the pudding was in the eating, because although our resources were greatly strained we were at short notice able to produce the Commonwealth Division for Service in Korea. That involved the co-operation of all three Services, and it was effective. Since then it has perhaps not been effective. That may be due to the fact that there have been so many passengers passing through the Ministry; none of them had time to make much of a mark. The last one to do so was Lord Head—I forget how many Ministers ago. The others were just birds of passage. I think that had a bad effect on the Defence Ministry.
I never agreed on the wisdom of creating a fourth Chief of Staff. Inevitably, that meant that in one of the three Services you had two heads, one a Chief of Staff in the Defence Ministry and the other the Chief of Staff of the particular Service. I do not think that was necessary. With competent members of the General Staff in your C.I.G.S. or your C.A.S. or your First Lord, you could get the co-ordination you wanted and the chairmanship you wanted. Of course, the outstanding example of that was when Lord Alanbrooke was chairman. Lord Alanhrookes do not grow on every tree; but then nor do Lord Mountbattens. He has an unrivalled experience in co-ordinating the three Services. You have to make provision for the ordinary man.
In the days before the Second World War, I frequently made speeches in the House in favour of a Ministry of
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Defence. I was always met by the words, "If you try to do that, you will produce a Minister who is much too strong for the rest of the Ministry; and a competent Minister with a great Defence Ministry behind him will be much too big for the rest of the Cabinet." That was the complaint on all sides, taken up in the Conservative Party. It is surprising to me that they have now gone the whole hog and have reduced the civilian heads of the Fighting Services to little more than Under-Secretaries. I think they are destroying the traditions of the three Services and I look with great doubt at this new set-up. It seems to me too complicated.
First of all, you have the Secretary of State for Defence. I thought it was a good principle that major planning should be separated from detailed administration. That, I think, is the rule in the Fighting Services. Here you are going to put all the detailed planning and all the detailed administration into the hands of the Minister of Defence. The Service Ministers are mere Under-Secretaries. All the decisions are to be taken by the Secretary of State. I think that is wrong. When we devised the Ministry of Defence, the idea was that it should be kept small. Now it is being expanded to 25,000 staff—a great deal of harness for quite a small horse. I would rather see a little stronger horse than all this stuff, and I am most doubtful whether you are going to get any economies. I think you will find that the Service heads of the Navy, the Army and the Air Force who are going to be located in this Whitehall Pentagon, will not do without a pretty full staff. The First Lords of the Admiralty always need a flotilla, and they will also have one when they get back to the other offices. They are much more likely to duplicate than economise in staff.
Then, I think, there is a general depression of civilian control. Our system throughout the ages has been one in which civilian control is at the head of the Fighting Services. If the civilian is wise he does not try to do major strategy. If the Fighting Service chiefs are wise they do not interfere in politics. They have their sphere. Here I think responsibility is blurred. I find it very difficult under this scheme to make out who is really responsible for the Fighting Services. It seems to me

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that it all comes back to the Secretary of State and is taken away from the other three Service Ministers. I think you will tend to exalt the Secretary of State, and if he is not a strong man you will exalt the chief military officer. That is a mistake. History has shown, if you look at the state of affairs in Germany in the past, or in America, that it is a mistake not to have adequate civilian control over your technical, military men. I am very much afraid that this will lead either to overwhelming the Secretary of State with too much work or too much power, or to handing over effective control to a military chief. I think that with a few improvements our present system could have worked perfectly well.
Then, again, there seems to me to be an immense complication. You can bring in your scientists—and you should bring them in; they fit quite well into the ordinary organisation, either the three Fighting Services or the Ministry of Defence. But it seems to me rather a matter of window dressing to say, "Look how scientific and up to date we are—we have got Mr. So-and-So, F.R.S., right up to the top". It does not really make a substitute for the proper training of your officers. And I say that, being familiar with all three Services and being familiar with scientific advance.
Then one should have a proper Defence Ministry or a Defence Committee of the Cabinet. I do not know whether that disappears or quite what happens to it. That brings in the Foreign Office, the overseas Ministers, and possibly the economic Ministers. It worked all right during the war and afterwards. Now I think that it will be overwhelmed by this Colossus if one has just one person on the Defence side. I would much rather have the views of the three Services freely expressed in a Committee of Defence, with other Ministers present so that such views can be examined and due weight given to them.
I confess that I do not like this system. It may just be because I am too old. I do not believe it is really up to date. I think it is an attempt to do something which is rather alien to our traditions. I think the noble Lord, Lord Teynham, was quite right in wanting to retain the name of the Admiralty. After all, it was a very clever device to have the Lords
40
of the Admiralty and the Lord High Admiral in commission. You had others, historic or otherwise; and you upset things when you destroy these old landmarks. You do something to destroy the spirit of the Services. I do not think it is a good thing to degrade Ministers. The Services ought to have, as they had in the past, a Secretary of State to whom they owe allegiance, and to whom in case of need they can appeal. Now what have you got? A mere sort of Minister of State; a kind of glorified office boy to the Secretary of State for Defence. I hope this idea will be taken back and reformed. I am quite sure that when another Government come in they will find they will have to reform it. If I am not greatly mistaken, they will find it has grown into a Frankenstein which they will have to destroy in due course.
4.25 p.m.
LORD BALFOUR OF INCHRYE: My Lords, through the courtesy of my noble friend Lord Ampthill, who wants to speak on one particular aspect of these proposals, I intervene for a few moments only. It is quite clear from what has been said in the debate to-day that this is a major surgical operation on Government machinery. The noble Lord, Lord Shackleton, and the noble Earl, Lord Attlee, have deployed the many questions, both of policy and of administration, which in this new structure remain unanswered. All will not work smoothly in the future. There will be personal and administrative difficulties old Service pride will continue and rivalries will not melt overnight.
My purpose in contributing to this debate is to ask whether the Government would consider giving an undertaking that an objective disinterested review, conducted by authoritative persons, will be held within, say, two to three years' time from now. I believe some such assurance would be healthy for all those who are affected by this great surgical administrative operation. It will be within your Lordships' recollection that some time ago the Government called in wise and experienced men, who commanded the confidence of the serving personnel, to examine the question of inter-Service co-ordination. It would not be good enough to let the interested executive Departments conduct a review of matters which may need remedying

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in the light of experience. It seems to me that there will be a requirement for a review in two different directions. The first direction will be as to whether the position of the Secretary of State for Defence is in all respects a satisfactory one; whether in future it will be shown that he is too powerful a single Minister in a Cabinet of collective responsibility; and whether his financial and other powers are not too great. I do not know—and I do not believe any of your Lordships know—what will be the result of such questioning in two or three years' time. The Prime Minister of the day, whoever he may be, is the only man who will be able to carry out such a review.
The second type of review is as to whether the executive machinery of government is working satisfactorily. I submit to your Lordships that this matter should be put under the microscope, as it were, not by those interested—and all those in the Government Departments must be interested parties—but by those of experience who are completely detached from any personal consideration of the problem, so that they may reach an objective, disinterested view. I believe such an assurance would be healthy for all those who will have to carry forward the new structure envisaged in this Bill. That is the only purpose for which I have intervened, for I believe it is the desire of your Lordships to see that this machinery works effectively in the future. If the Government will give an assurance in regard to such a detached review, I believe it would increase the confidence of those affected by these proposals.
4.30 p.m.
LORD AMPTHILL: My Lords, I do not wish to repeat anything that was said, either by myself or by other noble Lords, in the debate on July 31 last, when we were debating Command Paper 2097. Nor do I wish to withdraw my general agreement with the proposed organisation, though I must qualify that remark by saying that I agree with all that my noble friend Lord Teynham has said. I also agree with some of the very pertinent criticisms made by the noble Earl, Lord Attlee, and the noble Lord, Lord Shackleton. I personally believe that the White Paper proposals go too
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far in the matter of throwing overboard some of the traditional names, for which we have substituted three Defence Ministers and cohorts of Second Permanent Under-Secretaries of State. I will leave the Second Permanent Under-Secretaries of State, but I must just refer to the three Defence Ministers.
Like the noble Lord, Lord Shackleton, I cannot see how these very senior Ministers are going to operate unless they have clearly defined responsibilities, and there is nothing in the White Paper, where they are described as Ministers of State for Defence, that properly defines their responsibilities. It is said that one of them will be responsible for the Navy, one for the Army and one for the Air Force, but that they will have a general field over the whole Ministry. I cannot see myself, a business executive, or the noble Lord, Lord Shackleton, also a business executive, putting senior managers into that sort of position. I think that these Defence Ministers (and I am very glad that they have been upgraded to Defence Ministers) should have clearly defined responsibilities, one for each Service. As I have already said, I fully support my noble friend Lord Teynham in all that he has said about dropping the name "Admiralty", and other well-known traditional titles. My own bet is that for many years to come, whatever the Government may decide, sailors will still refer to the Admiralty, soldiers to the War Office and airmen to the Air Ministry.
Noble Lords who have spoken, particularly from the opposite Benches, have made some reference to Parliamentary control. I know that that was meant strictly in the financial sense, but perhaps your Lordships will here forgive a slight digression. I have recently been reading some papers dealing with the Civil War, from 1642 to 1648, when the Navy was loyal to "King and Parliament", as it was then described. There was a Joint Committee of both Houses, but it was from this House that the Orders to the Fleet were issued. The Chief of the Naval Staff of the day—as I suppose one could call him—Robert Rich, then Earl of Warwick, issued the Orders on behalf of your Lordships; and the records show that those operations, which were nearly all combined operations for maintaining

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Hull, Plymouth and North Wales, as well as other ports, for Parliament, were conducted from this House. The soldiers were very few on the side of King and Parliament; so the sailors were landed and, with the infantry and gunners, with their guns, their pikes, and their muskets, stormed these places. I thought it might interest your Lordships to know that in those days operations were run from this House.
My Lords, once this Bill becomes an Act, enormous powers will be placed in the hands of the Secretary of State for Defence. He will control the largest single organisation in this country, and also the most complex. We all know that Secretaries of State for Defence come and go. They will continue to come and go as Governments change and Prime Ministers change their minds—though one hopes that one will not have quite the same frequency of change as we have had during the last decade, with nine or ten. At any rate, my Lords, this constant changing means that the continuity will be in the hands of the Chief of Staff to the Secretary of State for Defence, the Principal Under-Secretary and the Chief Scientist. They are the key men. The Navy, Army and Air Force element: in the Ministry, at whatever level, will be continually changing. They seldom remain for more than two or three years in one of the Ministries—most of them do not want to.
All this means that very great power and responsibility will be with the civil servants who are to staff this powerful Ministry. There is a fear, which I have heard expressed in more than one quarter, that in consequence this huge machine, this vast organisation, will come too much under the domination of the civil element. I do not entirely share this view; none the less, I think that watchfulness and care will be necessary to avoid any danger of this. There is a story, probably apocryphal, of a one-time Secretary of the Admiralty who in an unguarded moment referred to "my uniformed branch". We do not want the Principal Under-Secretary of State set up by this Bill referring to "my uniformed branches". I hope and believe that this is unlikely to happen, but this machine is so vast that continuity will largely lie in the hands of
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the civil servants, for the reasons I have given.
My Lords, as I have said more than once, enormous powers will be concentrated in the hands of the Secretary of State for Defence as soon as this Bill becomes an Act. Much has been written, much ink spilt and many words spoken, about the effect of this Bill, when it becomes an Act, on the Fighting Services. But very little has been said about the effect on private citizens. I do not mean in the matter of protecting them from the blast of the enemy, but in their rights. Among the powers that will be transferred to the Secretary of State for Defence are those in Clause 2 of the Bill. This transfers to the new Secretary of State all the powers at present held by the Service Ministries, to hold and acquire buildings and land, including the compulsory acquisition of land for the purposes of defence.
Clause 2 cites a whole series of Acts, commencing with our old friend the Defence Act, 1842, and going right down to 1935. For some reason (though I am sure there is a perfectly good one), I can find no reference in the Bill before us to the Land Powers (Defence) Act, 1958. I mention this because, shortly after this Act I have just named became law, a Written Answer was given to a Question in another place. This Written Answer by the then Secretary of State for War will be found in Commons Hansard, March 6, 1959. In his written reply, the then Secretary of State for War stated that it was the Government's intention to apply safeguards as set out in the Land Powers (Defence) Act, so as to give the same protection to citizens whose land it was proposed to acquire compulsorily for defence purposes as they had under the Act. This, he said, would be done by administrative action; and the administrative action was set out at length in the Written Answer.
As one of the trustees for a small dairy farm in Dorset, I am unfortunate enough to be subject to this administrative procedure, because the trustees objected to the acquisition of our land on which the Air Ministry wanted to build a wireless station for the United States Air Force. I described our experiences to this House on July 12, 1961, and I referred to them again on December 7, 1961, on both of which

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occasions (and this is the point of my mentioning the matter again) we were debating Motions by the noble Lord, Lord Lucas of Chilworth, on the Council on Tribunals and relevant matters. During the course of these debates in your Lordships' House, I asked certain questions, and I have given notice to the noble and gallant Earl who is to reply for the Government that I should ask them again to-day, because I think it is very important to the private citizen. It can have no effect on myself or my co-trustees: our business is finished.
My first question concerns procedure set out in the Written Answer by the Secretary of State for War in another place on March 6, 1955. Explaining this procedure to your Lordships on July 12, 1961, when we were debating, my noble and learned friend Lord Kilmuir, who then sat on the Woolsack, described this procedure as being [OFFICIAL REPORT, Vol. 233, col. 212]:
"invented to deal with the difficulties of the Service Departments".
After briefly describing those difficulties, mostly questions of secrecy and security, he added:
"… Even the Ministry of Defence is in a different position".
Your Lordships will find the noble Earl's complete answer in the Hansard for that date, in column 212.
So my first question is: Will this new Ministry of Defence be bound by the procedure of March 6, 1959? Before our second debate on this subject of the Council on Tribunals and relevant matters, I had discovered the hard way, simply by attempting to refer the question of my costs to the Council on Tribunals, that the Council on Tribunals had no power to act because they considered that inquiries held under this "invented" procedure of March 6, 1959, were not statutory inquiries within the meaning of the Tribunals and Inquiries Act, 1958. Thus the trustees were shut out from taking the question of their costs before the Council on Tribunals.
During our debate on December 7, 1961, I asked two questions, which I repeat to-day. First, when will the new defence legislation, replacing the Defence Act, 1842, and all the other Acts, not to mention the "invented" procedure of March 6, 1959, be brought be-
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fore Parliament? The next question is: Will the special tribunals which will undoubtedly be set up under this new legislation be brought within the scope of the Council on Tribunals? In his reply on December 7, 1961, at column 215, my noble and learned friend Lord Kilmuir undertook to bring these matters to the attention of his right honourable friends in the Service Departments—and, knowing the noble and learned Earl, I am sure he has done that; but I have heard no more.
Even if the noble and gallant Earl cannot give a complete answer to my questions to-day—and I apologise for giving him rather short notice, but it was unavoidable—I think we should have the answers before we part with this Bill. It is not very easy for the ordinary citizen to deal with individual Service Departments even as they exist to-day. It seems to me it will be infinitely more difficult for him to deal with the vast and comparatively impersonal machine which we shall set up by this Bill. I think it is essential that, when the Bill becomes an Act, it should include all reasonable safeguards for the ordinary citizen. It is patently easy for the Defence Department, and I think it will be even easier for this vast machine we are creating, to hide themselves under the dual umbrella of security and secrecy. Even if it is impossible within the near future to draft new legislation to replace the present series, which commences with this ancient Act of 1842, I believe that the "invented" administrative procedure of March 6, 1959, should be amended by further administrative action to bring any tribunals set up thereunder within the scope of the Council on Tribunals.
4.45 p.m.
THE EARL OF SWINTON: My Lords, may I say, before the noble Earl, Lord Alexander of Hillsborough, winds up, that I should not have intervened but for the speech of the noble Earl, Lord Attlee, because I really said all I had to say about the contents of this Bill in the debate on the White Paper; but the noble Earl, Lord Attlee, does move me to make this one observation on his speech. He, laudator temporis acti, wants to go back to the old procedure under which the Secretary of State for Defence would act as successive

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Ministers of Defence have acted. My whole objection is that, as it worked in the past, the Minister of Defence really was an arbiter over the three Services, which very often presented conflicting claims; and, while we want to preserve the identity of the Services, I think that nearly all of us want to come closer to an integrated staff, an integrated conception of planning, so that we shall have the three Services working under a single direction, with the Minister, the Service Chiefs and the scientists—very important—interested from the very start in the formation of policy and creating that policy, rather than the Secretary of State coming in as the arbiter. I think that is the whole difference, and unless we have a Ministry of Defence on this scale and with these powers I do not believe we shall get that reform which we all desire.
The other thing is this. There has been a great deal said about changing the name of the Admiralty and other names. I must say that I have a good deal of sympathy with much that has been said about that. I know that baptismal regeneration is supposed to get rid of, and no doubt does get rid of for the time being, original sin, but I am a good deal more doubtful as to whether a baptismal regeneration by which you bring about changes in nomenclature, by which you call the Board of Admiralty the something-or-other and the First Lord of the Admiralty the Minister with or without Portfolio, is going to have much effect upon the spiritual approach which Ministers and Service Chiefs will have. As a matter of fact, I should have thought that it would have had rather the opposite effect, and I should have thought it might act rather as an irritant. On the whole, I think it would be a good thing to keep as many of the old names a; we can while imbuing them with the new spirit.
The only other thing I would say is this. An appeal was made by my noble friend Lord Balfour of Inchrye, who said he hoped the Government would give an undertaking now, before they set up this new machine, before it was working, that in a year or two there would be an impartial inquiry to see how it had worked. I very much hope the Government will not give any such undertaking or do anything of the sort. If we are setting up a new machine and want
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it to work—and there are going to be difficulties—and if we want to get the Service Chiefs to work together, would it really be a very sensible thing to say to them, "Of course, if you do not like the machine, if it does not work, if you do not make it work, then it is all right—we are going to get some people in from outside to examine it in a couple of years' time"? I cannot think that that would really be a very good idea. What I think all of us in Parliament ought to do after this Bill has gone through—and, whichever Government is in power, I am sure this will be carried out—is to watch how the machine works and to watch it most carefully, but to watch it with a constructive eye; trying to make it work and criticising where we find any defects, but at the same time giving that constructive help which Parliament can give better than anybody else to the Secretary of State and the other Service Ministers and the Service Chiefs in order to make the new machine work to the best advantage.
4.50 p.m.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, first of all I should like to thank the noble Earl who introduced the debate to-day for his comments on the Bill which, as has been pointed out more than once during the debate, is a very short and enabling Bill. We shall have to be certain and see what proof there is in the pudding that the Administration finally produce for the observation and criticism of Parliament. It is a very difficult situation indeed. I am glad that the noble Earl, Lord Swinton, joined in the debate—I was not complaining of his intervention; I was, in fact, wondering when he would come in, because I thought he put one or two exceedingly pertinent questions in the course of the Minister's speech this afternoon. In spite of some aspects of the speech of the noble Earl, Lord Swinton, I think there is a great deal in what he said. There was also much in what was said by the noble Lord, Lord Teynham, my friend, Lord Attlee, and, especially, in the analytical survey made by my noble friend Lord Shackleton.
Nobody wants to go backward in the organisation of the defence of this nation; nobody wants to dispute the suggestion made by the Prime Minister

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from time to time that only strength can really command respect for our country in the world—although I am sure that in assessing the term "strength" we must not always think of armament. It must be strength in progress, in expansion of production, in new ideals, and in many other things. But when it comes to the actual defence of our country, we must be exceedingly careful how we go and in deciding what should be the actual result of that buildup in general of national strength so as to be a power in the world and in the progressive discussions of the Powers in the world.
I want, therefore, to look now at the suggestions made from that general point of view. We on this side of the House have had experience; though sometimes it is hardly recognised. And we have had experience in varying circumstances. We had experience in what would be the future of the national organisation of our defences when we had that tremendously important Naval Conference of 1930, in which we obtained a provisional agreement with Mussolini for a declaration in all the Chambers and which, if the French had not run away on that occasion three weeks later when they were asked to sign the Protocol, would have changed the whole basis of armament in Europe and the strength which was to be deployed in the Second World War that we unfortunately had to go through. We have had experience of that.
Many of us—not all; I do not want to put too high a price on it—in my Party have always taken the line that the question of defence should, as much as possible, be on a non-Party basis. We have never admitted the sort of claims made politically that members of my Party are not prepared to defend to the end the honour and liberties of the citizens of this country. I think we proved that by our actions in the war. We have had experience of serving with Ministers of other Parties, including the Conservatives and Liberals, in this last great war; and we have seen, existing for the first time in the tried operations of warfare, what a collective system of the control of defence must mean. If the organisation of the 1939–1945 war is compared with the organisation of the
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First World War, what a vast change can be seen to have taken place in ideas and in machinery! From the moment of the breaking-out of the 1914 war there were constant quarrels between the different Parties in Parliament, whatever happened inside the Cabinet. Steps taken to achieve proper defence of the country seemed never to be at the right time or at the right strength. It took two years, from 1914 to 1916, to get from the new form of Coalition—under that kind of management—National Service brought in. This was after two years of slaughter of hundreds of thousands. Nor were there, I would say, anything like the preparations beforehand or the proper co-ordinating of the roles, the efficiency and readiness at the time, of the three Services.
In this last war there were all the difficulties of starting with quite insufficient preparation for the type of warfare that was going on. The idea of a Ministry of Defence started very tenderly; first of all through a Minister for Co-ordination of Defence, with hardly any staff. But gradually, by making people think and progressing in their thinking, we had by 1939–40 a machine which, especially on the military side, was working with co-ordinated efficiency in such a way as had never happened before.
I remember meeting one day, at the end of October, 1939, just outside the Army and Navy Stores, the late Field Marshal Sir George Milne, whom I had known for years before when he was serving with us in the Labour Government on the Committee of Imperial Defence. He stood at the corner of the street and said to me, "Well, Alexander, what do you think is going to happen in France? They are calling it 'the phony war'. How are you calling it?" I said, "I think it is going to be very much steamed up before long." He said, "Have you considered the proper connection between our problems now with political actions before? The strategy that ought now to be adopted is to examine what is likely to be the first political action now in Europe. Holland and Belgium are neutral; but before long they will be bound to decide whether they can remain neutral and, if they are invaded,

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whether to show a front and the spirit of their countries. When you look at that, you look in a certain direction: just about from the end of the Maginot Line; and when you get the call to come in and help those in Holland, you must accede to it. Then the Germans will strike there and they will be through." And that is exactly what happened. We must have all that kind of thing worked out now between the Government, Ministers, and the Department of Defence.
I quite agree with what was said this afternoon by the noble Lord, Lord Ogmore. If we are not ready with the right kind of organisation, how on earth is all the great stretch of Staff and the regimental, Navy and Air Force officers to be instructed in Staff Colleges, if the Government do not know what policy they have to pursue? Therefore I applaud the Ministry of Defence as set up in the last war and as it worked then. But I am bound to say that it would have been quite impossible for that to be so successful if there had not been at the head of each Fighting Service a Minister who was responsible to the Minister of Defence and to Parliament for the discipline, the training and the equipment of the forces of the Department he had to control.
The one thing that I wanted to see after the war—and I talked it over often with my noble friend Lord Attlee—was that this kind of overall top organisation should not be abandoned. And the cost of the Ministry of Defence which was set up by my noble friend was so much less than the amount now proposed to be spent on this new Ministry as to be absolutely astounding. Even though the development that took place with National Service and the struggle in Korea meant that the budget for defence could not be kept down to the early low level, the cost, in relation to the good that was achieved, was infinitesimal in the years until 1951.
What sort of remedy are the Government bringing to Parliament to deal with what has happened since 1951? It has been stated in more than one of the speeches this afternoon that perhaps one of the reasons for our bad position now is that we have had so many Ministers of Defence that we have had
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no continuity of effective control or effective suggestion or general planning. I think that that is probably quite true. But if we look at the possible expenditure on this new scheme in the light of the fact that at the present time we are spending £1,838 million upon national defence, when we have just a little more than one-third of the personnel in the Defence Forces that we had in 1951, it is an amazing situation.
When the Ministry of Defence was set up in 1950, we had for the first time the development of research and scientific organisation within a unified control and great results came from it. But now we are to have the Minister of Defence put in a position in which he is Secretary of State for Defence as a whole and nobody but he is responsible to Parliament. I do not know what the Minister is going to say in reply to-night, but I want to concentrate on discipline. Who is going to answer for the discipline of the Fleet? Who answers for the discipline of the Army and who answers for the discipline of the Air Force? The Services have totally different arrangements for discipline, because they have completely different Service conditions and training. They have always been managed by their own Service Chiefs and the Minister at the head of each department has been responsible directly to Parliament for discipline.
I was responsible to Parliament for the discipline of the Navy in the course of the Cabinet break-up in 1931 and, as I have said before in this House, if they had acted within the Cabinet on my advice, we should not have had the mutiny at Invergordon. I told the Cabinet then that, if they broke their pledge on the pre-1925 enlistment in the Royal Navy, I could not be responsible for the discipline of the Fleet. May we have an answer to-night on this point of discipline? I know that this is only an enabling Bill, but I think it is at this point that we want to settle the principle. I want to know from the Minister now whether the Ministers of Defence of the Navy, Army and Air Force are going to be responsible to Parliament. I know that the quality of discipline obtained will depend on the efficiency of the organisation of the military side of each department, but the

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political Minister must be directly responsible to Parliament for that.
I am also a little anxious about the question of security. The amount of security which is required in the normal operation of a Service department is not small. I am sure that the noble Lord, Lord Carrington, who I am glad to see has come into the Chamber, would agree, after his experience in the last two and a half years, that a Service department still has a very important part to play in security. It is true that politicians sometimes get awkward and say that the Prime Minister is the head of the security service. So he must be. But who will be responsible now for the defence services—just the Secretary of State for Defence or are there going to be responsibilities passed on? Where security matters arise, will the Ministers for the Service departments be able to get up in Parliament and speak in support of whatever action has been taken or explain why no action has been taken?
When it comes to the co-ordination of supplies, I still think that this is best obtained by a Ministry of Supply such as the Ministry which the Labour Government began during the war and later had to carve down to proper peace-time size, keeping a real co-ordination between departments with regard to general supplies and costs. If we considered it from that point of view, I think that we should do far better if we continued the Ministry of Defence in the form of the Ministry set up by my noble friend Lord Attlee. We should not give such great power to one Minister, and on no account should we drop that form of Cabinet organisation in which defence matters are considered, before going to the Cabinet itself for final settlement, in a defence committee in which the Defence Ministers and their Chiefs-of-Staff attend as of right to state their points of view, with other Ministers of the Cabinet there and able to judge a case from the firsthand knowledge and direct opinions of the Service Chiefs.
I am not going to add to all the points made by my noble friends Lord Shackleton and Lord Attlee, but perhaps I may be excused for saying a word on the point raised by the noble Lord, Lord Teynham, which was also discussed by my noble friend Lord Attlee, concern-
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ing the names in the Service departments that are going to be continued or destroyed. I do not know why it is especially necessary—was it due perhaps to wanting to change the position in the Admiralty?—that the Air Council and Army Council are to be abolished and that within these departments we are to have something called a Board in their place. The Lords Commissioners of the Admiralty and the Board of Admiralty are terms understood throughout the nation and throughout the world, and I should have thought that in any co-ordination and development of the defence services we should retain such traditions as are really helpful. Therefore I hope that further attention will be given to retaining the term "Admiralty." I think that it is an extraordinarily effective name. When we think of all the questions that go through the Court of Admiralty as well as the actual Board Room at the Admiralty, we can understand why the highest court in the land for trying nautical cases is still called the Admiralty Court. It is of great effect to retain that title.
The Air Force, of course, is much more modern, but it has grown up as an Air Force under the terms of the Council of the Royal Air Force to have enormous respect among its personnel for the operation and action of the Council. You have put the word "Council" again now in the rest of the White Paper—setting up a special Defence Council within the Ministry of Defence itself. I had no difficulty about that. I do not see that you need such a Council unless you are going to put a special value on having between the Minister of Defence and the Council some superior Staff Officer. I am not going to criticise anybody who has held that post, because I have not been there to observe what has happened, and I would not know. But there was no need for a special chief staff officer, first to analyse what the Chiefs of Staff had decided, or perhaps disagreed about, and then for that to be presented to the civilian Minister of Defence, on the understanding that he was hoping to keep his job as the chief adviser, and therefore would like to see his opinion accepted. I do not think that is a good position at all. It was always possible for each of the Services to take it in

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turn to provide the Chairman of the Chiefs of Staff Committee, and for the Minister of Defence himself, whenever necessary, to take the chair at the Chiefs of Staff Committee, which I had to do, so that he could hear any discussion that went on as to points upon which they were not fully agreed. There is no need for this extra intervening post whatsoever.
When we come to the administration which is to go on underneath that, we are going to have four civil servants of the rank of Permanent Under-Secretary under the Permanent Secretary, who will be Secretary to the Minister of Defence. You will have to have both Permanent Secretaries and Under-Secretaries in every single Service Department and the Science Department. This is just sheer duplication and a waste of money. I hope that before this Bill is implemented the Government will have another think about the whole thing, and may feel, with all the traditions we have in the Services, that they should not be kept if they are not right, but that they should not be cast aside until they have been properly examined and consideration given to the real effects upon us as a nation of their being unduly interfered with.
I should like to say that I hope when the Defence White Paper comes out—we have been discussing to-day through the usual channels what the date will be, and it will not be too late in March—the Government will be able to say to us something in addition to what the Minister will be able to say to-day. But, in the meantime, I think I carry my noble friends with me when I say that, much as we should like to be able to say we accept this enabling Bill as it stands without the alteration of a word, a comma or a full stop, we shall have to think again and may possibly have Amendments to put down at a later stage.
5.13 p.m.
EARL BATHURST: My Lords, could I ask my noble friend, when he is replying, whether he will add one more assurance to what the noble Earl the Leader of the Opposition has asked for? The noble Earl opposite has asked for assurances on discipline, co-ordination, supply, organisation and so forth, and I should like to put in a special plea on
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the welfare side of the Services. So often your Lordships get letters—they may come from men in all arms of the Services or maybe from parents; perhaps an injustice has been done and it may be to do with a court-martial or a compassionate posting—and your Lordships (and it goes for Members of another place, as well) are able to pass these letters on to the Minister concerned. Will these Under-Secretaries to whom the noble Earl opposite has referred have enough authority to be able to deal with and make the correct decisions upon these things, trifling in themselves but vital to Servicemen and their families? I find it hard to believe that the Supremo, the Minister of Defence himself, will be able to make such decisions. Will these Under-Secretaries really he able to make the same effective decisions which the present Ministers in their respective Services are able to make? I shall be glad if my noble friend can give us an assurance on that as well.
5.15 p.m.
EARL JELLICOE: My Lords, I am grateful to those noble Lords who have joined in our debate this afternoon for the constructive, if somewhat varied, welcome which they have given to this Bill. I was particularly glad to note the observations of the noble Lord, Lord Ogmore (he has apologised to me for his absence) and to learn that, at least in principle, the Liberal Party stand foursquare behind the objects of this Bill. I derive some encouragement from this. I am sure, too, that your Lordships were especially glad that the noble Earl, Lord Attlee, has spoken in this Second Reading debate, because he brings to the debate, along with a sharp and powerful sting, an almost unrivalled knowledge of these matters, as indeed do the noble Earl the Leader of the Opposition and my noble friend Lord Swinton, who I think made a useful intervention on my side of the House.
That said, by way of sweetening the pill, I should like also to thank my noble friends who have joined in this discussion. A good many of the points raised go a little beyond the actual framework of the Bill, and even of the White Paper which we have been, by implication, discussing—for example, Lord Ogmore's plea for a Commonwealth Defence Force. However, that, and other observations of this sort, I

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will certainly study; and I will see that they are drawn to the attention of my right honourable friend.
My Lords, having recovered, at long last, after some months of convalescence, from our labours over the London Government Bill, I am feeling in a particularly conscientious mood.
LORD MORRISON OF LAMBETH: It was a pity you were not then.
EARL JELLICOE: I have noticed of late a slight change in the attitude of the Party opposite towards the London Government Act.
LORD MORRISON OF LAMBETH: Not in me.
EARL JELLICOE: Despite my conscientiousness, which has now been—
LORD MORRISON OF LAMBETH: Challenged.
EARL JELLICOE: Yes, challenged—I am sure noble Lords will neither expect nor wish me to pursue all the many points which have been made in our discussion this afternoon, more especially as we have a good deal of further business following on our heels. I shall, however, attempt to answer at least some of the points raised (and some of them were pretty cogent), and if there is any matter on which noble Lords who have spoken particularly wish for the Government's views, and feel that I have omitted to comment on them, I will certainly endeavour, if they do not pull me up in the course of my reply, to follow these up later.
I think the first group of criticisms, or comments, on this Bill was concerned with the political structure of defence and the central organisation, the top layer. I should like to turn for a moment to those criticisms. The noble Lord, Lord Shackleton, voiced a criticism which was echoed by more than one speaker: that was a fear that this all-powerful leviathan, the new Ministry of Defence, with its powerful Secretary of State for Defence at the top of this organisation, would be too powerful and would in some way escape from the political control of the rest of the Government machine. This was a broad fear which found some expression in your Lordships' House this afternoon. But any such fear is, I think, based on a
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misapprehension; and I should like for a moment to refer your Lordships to the second sentence of paragraph 16 of the White Paper, where we read of the supreme authority of the Prime Minister and of the Cabinet over these broad issues of defence policy. That supreme authority is in no wise impaired by this new structure which we are proposing. The Prime Minister, for example, is going to be firmly in the saddle as the Chairman of the new Defence and Over-sea Policy Committee. As I see it, that Committee is the point where the main strands of our external policies in defence, foreign affairs, economic affairs, and, not least, in disarmament, will be brought together; and that seems to me perfectly right.
May I answer the question which the noble Earl, Lord Attlee, put to me?—and I apologise for not being here at that moment. He was inquiring about the Defence Committee. That has been absorbed in the Defence and Oversea Policy Committee: the two Committees have become one. I should have thought that in some measure this means that there will be that better co-ordination of these various strands of which the noble Lord, Lord Shackleton, was urging the importance. The noble Lord was worried that the Defence and Oversea Policy Committee had no strong permanent Secretariat of its own. Some noble Lords, if not now, at least in the debate last July, harked back with some nostalgia to the old Committee of Imperial Defence, which had its own Secretariat. In those days, of course, the three Service Ministries were stubborn fortresses, and there was no Ministry of Defence. Now the Ministry, and the Oversea Policy Committee, are underpinned, not only by a strong official Committee, under the Secretary of the Cabinet, but also by the Defence and Cabinet Secretariats themselves. I am sure that this will provide this new Committee with all the Secretariat backing which it undoubtedly needs—for I will certainly grant that there is need of backing.
In this general context of the top defence structure, the noble Lord, Lord Shackleton, also asked me if the Government had considered whether this overburdened Secretary of State for Defence, with his very large Department, would not be too grossly overburdened, and

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whether he would not require the assistance of some other Minister. I think what the noble Lord visualised was that the Secretary of State for Defence would be flanked by, say, a Chief Secretary, as happens with the Treasury at present. That is an interesting proposal, and I certainly should not wish to be dogmatic about it. After all, we have had excellent Parliamentary Secretaries at the Ministry of Defence before now. I hope that noble Lords will not press this suggestion too hard at this stage, and I would back that expression of hope with the reasons which my right honourable friend gave in another place.
My reason is this. If this second Minister at the centre were to be really effective—and there would be no point in having him there unless he were going to be effective and able to exercise considerable control—he would need to be superior in the defence hierarchy to the three Ministers of Defence. I think the noble Lord, Lord Shackleton, implicitly recognised this by suggesting the status of Chief Secretary. I should have thought that he would need to have that status, and to be in the Cabinet. But if so, then, of course, he would be over and above the Ministers of Defence, whose status would be correspondingly downgraded. This is, as I understand it, what most noble Lords who have spoken in this debate have been afraid of. We should, in fact, be setting up a four-tier ministerial structure: Secretary of State, Chief Secretary, Minister of Defence and Under-Secretary. I should have thought that, apart from other objections, that would have been extremely cumbersome and ponderous machinery. Indeed, it would run counter to the principle which the noble Lord, Lord Shackleton, has queried; that is, the principle that the Secretary of State for Defence entrusts the Ministers of Defence, or specific Ministers of Defence, with some across-the-board general defence responsibilities.
I was asked whether I could define that more precisely. Quite frankly, my Lords, I cannot at this stage. All I can suggest is the sort of areas where this might apply. I am taking the examples, as it were, out of my head, and I hope they will not be held against me. The sort of field where this might apply would be in matters like housing, pay, welfare (in the widest sense: that might
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be one), or certain functional and semi-operational fields, like higher communications or intelligence, which are susceptible to inter-Service treatment. But at this early stage of the game I should not wish to be drawn further than that on this point.
LORD SHACKLETON: My Lords, I certainly do not want to draw the noble Earl, but do I conclude that the Government have no particular functions in mind? If so, why have they made such a tremendous thing out of these functional responsibilities? Surely they must now back up what they have said.
EARL JELLICOE: As I have said, we are at a fairly early stage of the game. I think this is an important principle and, so far as I know, it has not been challenged. As to how precisely it is to be given effect to, I should have thought the noble Lord could perhaps contain his impatience for a month or two longer.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, at the same time, as one is dealing with this kind of thing, I want the noble Earl to give us a direct answer, because he has reported to the House that the status of the Service Ministers has been retrieved from going down to Minister of State, and that it is to be on a high level. I want to see the Defence Committee—you call it also the Oversea Committee of the Cabinet—having those Service Ministers as members of that Committee, stating their case direct if they like. They can agree with the Minister of Defence beforehand if they like, so that they will not be disagreeing with him in the Committee; but they ought to be there capable of being questioned.
EARL JELLICOE: I certainly do not wish to dodge—and it was not my intention to do so—this particular issue, the importance of which I fully recognise. With that in mind, I should like to turn now to the position and responsibilities of the Ministers of Defence as they are visualised at the present time. Let me remind your Lordships of the position.
They will be de jure members of the Defence Council. They will be Vice-Chairmen, and they will be, in most cases, de facto Chairmen of the particular Boards, Navy, Army or Air Force, as the case may be. As such, they will be responsible

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for the day-to-day management of the Services with which they are particularly dealing. In saying that, might I parenthetically answer my noble friend Lord Bathurst and say that, because they will be responsible for day-to-day management, they will be responsible for such matters as welfare so far as their particular Service is affected. They will also be responsible (and this, I think, is one of the points about which the noble Earl, Lord Alexander of Hillsborough, is understandably exercised) for the day-to-day administration of discipline in the Service with which they are associated.
My Lords, there are two residual points here which I have not answered: one is Parliamentary responsibility and the other is the point which the noble Earl has just put to me. I doubt whether I shall be able to give satisfaction to the noble Earl on these two points. The present plan is that, so far as the Defence and Oversea Policy Committee is concerned, the Defence Ministers will not be automatically members of the Committee. They will, however, be invited to attend where matters directly affecting their own Service are in question. I would just add that that has been at least the formal position with the Defence Committee since the reorganisation of 1957–58. There is no formal change there from the existing position, as I understand it—I speak with considerable reserve on the semi-constitutional points; but I think that is the position.
On the question of Parliamentary responsibility, on which both the noble Earl and the noble Lord, Lord Shackleton, more than touched, I would just say this. It is clearly laid down—and I made this, I hope, crystal clear in my speech introducing the Second Reading of the Bill—that Parliamentary responsibility for the whole Ministry of Defence and, therefore, for its constituent parts, the Navy Board, Air and Army, is vested in the Secretary of State for Defence. He has power (and this is clearly laid down in Section 1(5) of this Bill) to delegate, and to delegate finally in specific areas. That would include most matters of day-to-day management which we have also dealt with. But in the final resort—and this would affect matters of discipline and matters of budgetary control—the
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Minister responsible and answerable to Parliament would remain the Secretary of State for Defence. Quite frankly, my Lords, if you are setting up a unified, integrated structure with one Ministry, as is proposed in this Bill, with one Secretary of State responsible—and there can be only one Secretary of State responsible—I cannot see how one could arrive at any other conclusion. I do not think that the sort of suggestion which I understood was made by the noble Lord, Lord Shackleton, would be possible. It seems to me to be trying to have it both ways: having a unified Ministry and, at the same time, having subordinate Ministers answerable to Parliament. This does not seem to square with our constitutional practice, at least as I understand it.
LORD TEYNHAM: My Lords, may I interrupt the noble Earl? I think the noble Earl has made clear that these three Ministers of State will be responsible for day-to-day business in their various Departments. I also understand that they are to operate across the board—in other words, to be responsible in other Ministries, too.
EARL JELLICOE: My noble friend has completely understood me on the first point. On the question of the across-the-board responsibility, it is the intention of my right honourable friend the Secretary of State, as and when he becomes the Secretary of State to confer on particular Ministers of Defence certain across-the-board responsibilities for the type of matter to which I referred in reply to the noble Lord, Lord Shackleton. Those would cover the other two Services, but only in specific areas. The discipline of a particular Service would not be covered in this was at all.
THE EARL OF SWINTON: My Lords, would not the constitutional position really be this? Of course, the supreme Minister must be responsible, and either House of Parliament could "shoot" at him if necessary. But to make this plan work, has it not to work like this?—that both Houses of Parliament have to exercise a self-denying ordinance so as to put, and be entitled to put, their questions about day-to-day administration and all the minor matters to the three Service Ministers. Without that it would not work.
EARL JELLICOE: I am grateful to my noble friend: that is precisely my understanding of the position. It is what I tried to make clear to him in my reply during my original speech.
One minor matter—though it became not quite so minor during our discussions and is not minor to me, of course—is the question of Ministers' salaries. I will take note, with interest, of the suggestions made in your Lordships' House this afternoon, and I will take care to see that your observations are passed on to my right honourable friend.
Before leaving the overall structure, there is just one area on which I should like briefly to comment. I do so diffidently because it is a field to which I am rather new, but also because I was a little surprised by some of the comments made from the Benches opposite on the question of the position of the Chiefs of Staff and of the Chief of the Defence Staff. There was a fear, as I understood it, of advice coming through the Chief of Defence Staff. So far as the formal machinery is concerned, I should have thought that as long as we have a Chief of Defence Staff, this is surely right. You must have one man running the show and being responsible for putting the advice, but, of course, stating quite clearly where there are differences and where the differences lie. But I should like to put this further consideration to your Lordships: that I think here we may be making rather heavy weather. This is the formal machinery, but beneath and alongside that formal machinery there will be, as there are already, numerous informal discussions of the Chiefs of Staff, which are, of course, attended by the Secretary of State, the Minister of Defence, as well as other Ministers. This is a process which happens all the time, and it would certainly be my guess that this type of informal day-to-day contact and consultation will increase, given (to use a rather horrible word) the co-location in one building, rather than diminish. I think this should to some extent allay the anxiety of the noble Lord in this respect.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, I take it from what the noble Earl says that the intention would be, whether there was a Chief of Defence Staff officer or not, that the
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Secretary of State for Defence himself could go and take the Chair any time he likes of the Chiefs of Staff Committee. Let us look at what I reminded the House. We had no difficulty about having a Chairman of the Chiefs of Staff Committee. As they became chief of their own Service staff they followed to the Chair of the Chiefs of Staff Committee. I had a staff officer of my own who acted as the actual secretary. The first was General Hollis and then there was an Air Vice Marshal. I used to hear all about what was going on. I used to get the minutes in full, and I could go and take the Chair at the Chiefs of Staff Committee any time I liked when there was any disagreement.
EARL JELLICOE: I think I should like notice of this particular question, because the formal position is quite clear—it is as set out in the White Paper in paragraph 29—that the Chief of the Defence Staff is Chairman of this Committee. I would not wish to mislead the House and I would, if I may, at this particular point, get in contact with the noble Earl. Apart from that, there are these informal and very frequent day-to-day consultations, with the Minister of Defence, as it were, de facto in the Chair. This is going on all the time.
LORD SHACKLETON: My Lords, the noble Earl asks for notice. We have given him six months' notice. This question was asked last summer. I asked it again in my opening speech. It may be that he did not notice it at the time. I am not even asking him what will happen in the future, but perhaps he will tell us what is happening now. It is a very simple question and perhaps before the end of the debate we can get an answer. If not, at least we may have an opportunity to do so at Committee stage.
EARL JELLICOE: I should much prefer not to be drawn further on this matter at this stage, and if the noble Lord wishes to ask me this question at the Committee stage or at any intervening period I shall be only too glad to respond.
I do not want to weary your Lordships at this stage in winding up. May I turn to two areas in which specific questions were addressed to me? The first was the question of lands which the noble Lord, Lord Ampthill, put to me, and I

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am grateful to him for giving me notice of the points he was going to put. I think there were three questions he put to me. The first was why the Land Powers (Defence) Act, 1958, was not mentioned in the Bill along with the other series of Acts from 1842 to 1935. There is a simple reason for the omission, and I think it is quite unsinister. The Defence Acts which are mentioned are mentioned only because they have to be modified. At present one land code applies to the War Office and Air Ministry and a slightly different and less restricted one to the Admiralty. We want only one code for the new Department, and this will be provided. But the Land Powers (Defence) Act, 1958, has already one code for all the three existing Departments and no modification is needed to it.
The noble Lord's second question was whether we had made any progress in consolidating the various Defence Acts relating to land value for the Forces. This is in fact a pretty onerous task, as the Acts concerned are both numerous and complicated. But a good deal of progress in this direction has been made, and the Government have certainly not lost sight of the need to introduce new legislation in this sphere as soon as the work is completed and Parliamentary time can be found. I am afraid that, given our rather crowded programme this Session, I can offer but little hope to my noble friend that Parliamentary time will be found during the present Session.
My noble friend's third question was whether the Government would bear in mind the desirability of bringing inquiries under the administrative procedure introduced in 1959, the "invented" or "Soames" procedure as it is called, within the scope of the Council on Tribunals. I can certainly give my noble friend that undertaking. This is a question which will be very much borne in mind in the preparation of the legislation to replace the Defence Acts. I should like, having said that, to have a chance of reading the points put by my noble friend on this not uncomplicated area, and if there are matters I have not covered in the reply I will certainly expand in writing to him.
LORD AMPTHILL: My Lords, I am grateful to the noble Earl. He has covered all except one: whether the "invented" or "Soames" procedure will apply to the new Ministry of Defence.
EARL JELLICOE: I will put the "invented" or "Soames" procedure in the same package, as it were, shared with the noble Lord, Lord Shackleton, and the Chiefs of Staff, and follow that up later.
Now there is the question of names, and this is an area where I find myself in some difficulty, as I am only too conscious personally of being very sympathetic to a great many of the arguments which I have heard advanced this afternoon. I hope it will not sound parochial to say that I find myself in particular sympathy with the regret expressed at the demise of the word "Admiralty". I would remind your Lordships of a distinction which has been drawn in this field—and I think it is a useful distinction—by my right honourable friend. He has consistently drawn a distinction between, on the one hand, the abolition of the existing Service Departments, including the Admiralty, and consequently their titles, which derive from their functions, and, on the other hand, the retention in appropriate cases of terms like "Admiralty" where they have a wider connotation. I think there is a valid distinction here between the functional and (I do not use the word in a pejorative sense) the more decorative uses of these titles. I think it would be extremely difficult, if not impossible, given this proposed set-up, to retain "Admiralty" in the functional sense, because the definition of "Admiralty" as it is found in Statutes is "the Lords Commissioners for executing the office of the Lord High Admiral of the United Kingdom". That is the formal position.
LORD TEYNHAM: My Lords, the term "Admiralty" goes back far further than the Lords Commissioners. I am really most dissatisfied with the answer.
EARL JELLICOE: I am sorry my noble friend is dissatisfied with the answer. I have given only half the answer, and I hope he will not be even more dissatisfied when I have given the whole answer. I was saying that in this

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functional sense, because the Admiralty in the functional sense is to be abolished, it would make, I think, a nonsense to retain the title where it covers this area. But in the other sphere I think my right honourable friend has already shown that he is anxious to meet as far as possible the fears and objections that have been expressed. We will certainly continue, therefore, to refer to Admiralty Arch, Admiralty House, Admiralty charts—which is I think one specific point which my noble friend Lord Teynham raised—Admiralty notices to mariners, and so on. This matter is being looked into very keenly at the present time, and although I am sure I have not pleased my noble friend I hope I have shown that I am not entirely unsympathetic in this particular field.
I would only say two further things in conclusion. The first is that I share the extreme reserve expressed by my noble friend Lord Swinton about the proposal of my noble friend Lord Balfour of Inch rye, for a review. I share it on the same grounds: that these proposals are themselves the fruit of a most careful and impartial review. Of course, in the normal course of administration all this will be reviewed as it works out. But I should have thought there is the greatest possible objection at this particular stage to building an obligatory review procedure into the new machinery we are setting up. That said, and having expressed that extreme reserve, I will certainly see, without any commitment, that this suggestion is brought to the attention of my right honourable friend.
In conclusion I would say that one criticism which has been made this afternoon was almost, if not entirely, unexpected to me, and that was the criticism, voiced by the noble Lord, Lord Ogmore, among others, that we should have done many years ago what we are now proposing to do. That is a criticism which the Opposition, any Opposition, when they are rather short of substantive objections, make of the Government, any Government. More seriously, this criticism overlooks, I would suggest, the very considerable measure of interdependence between the Services which we have already achieved. We have already moved a very considerable way along the path to a fully
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integrated policy. Could I take one example?
The integration of the three Service Departments in the Bill has, of course, been preceded by the institution of unified commands in all the important theatres overseas. Despite some of the strictures which we have heard passed this afternoon, I think it fair to claim that that integration has at least worked pretty well. Indeed, it is clear that without it we could never have achieved such marked success as has been achieved in handling successive crises in recent months. I do not wish to make a Party point here; I should prefer to make an inter-Service point. The point is this. Surely, our recent operations in defence of Malaysia, our efforts to keep the peace in that beautiful but troubled island of Cyprus, and our support for the East African Governments, could not have been mounted and executed so rapidly and so successfully but for the closest co-operation and understanding between the Services.
EARL ALEXANDER OF HILLSBOROUGH: My Lords, may I say that I welcome tremendously that spirit. But that was always available in circumstances prior to those which are operating now. Indeed, arising out of my dear love of the Admiralty, I would say that the other Services have been exceedingly fortunate in these two outbreaks in outposts to have the services of five separate units of Royal Marine Commandos.
EARL JELLICOE: My Lords, I should like warmly to endorse what the noble Earl has just said. All I would do in this field is to remind your Lordships that the noble Lord, Lord Ogmore, asked whether we should be able to respond effectively and quickly to the sort of military requirements which he foresaw that we should need increasingly to respond to in the future. I would say that we are in that position now, and that the proof of the pudding is in the eating.
EARL ATTLEE: Surely the point is that you have done it with the old pudding, and not this new hotch-potch.
EARL JELLICOE: I think it was only partly the old pudding. If the noble Earl

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had been following me closely he would appreciate that I was saying that, with the institution of integrated and unified commands abroad, we have advanced matters somewhat beyond the stage which they had reached a decade or so ago. In claiming that this Bill represents an advance towards greater Service interdependence and towards greater integration of defence policy at the top, I am equally claiming that it represents an advance from a firm base.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

CONSOLIDATED FUND BILL
5.53 p.m.
Brought from the Commons, and read 1a.

FAMILY ALLOWANCES AND NATIONAL INSURANCE BILL
Brought from the Commons; read 1a; and to be printed.

HIRE-PURCHASE (No. 2) BILL [H.L.]
5.54 p.m.
Further considered on Report (according to Order).
Clause 3 [Right of cancellation of certain hire-purchase and credit-sale transactions]:
LORD DRUMALBYN LORD DRUMALBYN moved in subsection (5), after the first "which" to insert:
"either the owner or seller normally carries on a business or".
The noble Lord said: My Lords, this Amendment affects the definition of "appropriate trade premises", which now will read
"premises at which either the owner or seller normally carries on a business or goods of the description … are normally offered or exposed for sale".
This is a point which was raised on the Committee stage and which I undertook to consider. At that time noble Lords drew attention to the fact that the cooling-off provisions referred to a wider range of agreements than the doorstep transactions at which they are aimed. For my part, I explained that I was
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well aware of this, but considered that the safeguard would work only if we kept it simple. I accepted the exclusion from the cooling-off provisions of agreements where a hirer or a buyer is a body corporate. Since the Committee stage I have considered whether there are other cases where the application of the cooling-off provisions would cause practical difficulty, and if so whether we can meet them. My conclusion is that there is a good case for treating agreements signed at the business premises of the finance house, as suggested, I think, by the noble Lord, Lord Shepherd, in the same way as agreements signed in the shop—that some practical difficulty might be caused if this were not done, and that it could be done without endangering at all the working of the safeguard.
What this Amendment does is simply to include the business premises of the owner or seller of the goods in the definition of "appropriate trade premises". On the Committee stage, the noble Lord, Lord Shepherd, suggested that we should exclude agreements signed at such places as the offices of a solicitor. I doubt whether such a provision would be of practical significance for ordinary consumers. Moreover, if it were so considered, there would be a case for doing the same for agreements signed at many other types of premises—banks, accountants' and architects' premises, and so forth. The definition would then become unduly complicated. We are told, particularly now that agreements made by bodies corporate are excluded, that the present Amendment does all that is necessary. I beg to move.
Amendment moved—
Page 4, line 15, after ("which") insert the said words.—(Lord Drumalbyn.)
LORD SHEPHERD: My Lords, I am grateful to the noble Lord for responding to the points that we raised in Committee. But I wonder whether he will consider the drafting of his Amendment, and whether that drafting in fact meets the case that he has deployed this evening. The noble Lord has said that the purpose of his Amendment is to exclude from the cooling-off period those agreements that may be signed in a hire-purchase company's premises. My understanding is that at the stage when most of the hire-purchase agreements would be signed by a prospective hirer,

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the hire-purchase company will not have placed its contract with the dealer. Therefore, it cannot be said then that the hire-purchase company are the owner or seller: they have no rights; they have not purchased anything. Therefore, I would suggest that if the noble Lord would consider inserting the word "prospective" in front of "owner or seller" at least we should make clear in our minds, and perhaps in that of the courts later, what we intend, because unless the word is inserted I do not think we are anywhere further on in the Bill.
Here it describes "appropriate trade premises as those places in which goods are exposed for sale. This would be the owner or seller to whom the Government refer in their Amendment. It seems to me that the owner or seller in this Amendment could well not be the hire-purchase company. I hope that the noble Lord takes that point. It seems to me that this drafting needs to be looked at and revised. I am sorry that the Government have not seen fit to widen this area of business. We want to give the maximum protection that we can to prospective hirers, but at the same time we do not want to make business dealings too difficult. The noble Lord did not think that many ire-purchase agreements would be signed in a solicitor's office. It is true that we have removed from the Bill corporate bodies, but there are a sizable number of businesses carried on either by sole ownership or in partnership. I am thinking particularly of businesses which run hire-car services and which have obtained the cars under hire-purchase. Here they will enjoy the cooling-off period, if the Government cannot see their way to widen the scope of "appropriate trade premises." I will not press this particular point, because the Government have gone some way. I am sorry that they have not gone the full way, and I question whether the Amendment now set down meets the point which the noble Lord deployed. Perhaps he would look at it between now and the next stage.
LORD DRUMALBYN: My Lords, naturally I shall be willing to look at this, but I think that I shall be able to convince the noble Lord that it is all
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right. At the moment the definition covers
"goods of the description to which the document relates, or goods of a similar description … normally offered or exposed for sale in the course of a business carried on at those premises …"
That obviously will be the dealer, who may also be the owner. If the dealer and owner are separate, then if we want to cover the owner or seller we must have a separate definition for owner or seller". That is what is done, and "owner or seller" becomes a term of art by reason of the definition given in subsection (6), which shows that, as soon as the individual who is going to be the hirer appends his signature, the
"'owner or seller', in relation to the relevant document, means the person who, at the time when the document is signed by the prospective hirer or buyer, is specified in the document as the person who is to let the goods on hire to him or to sell the goods to him …"
I think the point is all right from the point of view of definition. I shall certainly take note of what the noble Lord said about the wider and separate point about partnerships; we shall look at that. One wants a definition which is clear-cut and easy to understand.
LORD PEDDIE: My Lords, I welcome this Amendment in principle, but I seek explanation on one aspect. There are many cases where an owner or seller or agent has premises in which goods are exposed for sale. He may also have an office which is quite detached from the store or shop in which goods are exposed for sale. Do I take it that such premises, even though they may be devoted exclusively to office purposes, would be considered as coming within the range of this Amendment?
LORD DRUMALBYN: Yes, my Lords, if this were a question of an office at which the business of the owner or seller was normally carried on.
LORD PEDDIE: Even where nothing was exposed for sale?
LORD DRUMALBYN: The point about goods being exposed for sale is the second alternative. Where the document is signed in the premises of the dealer, then it is all right. Secondly, where it is signed in the premises of the finance house it is also all right, although there are no goods exposed for sale. So if the dealer also had a little office

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which he used solely for his financing purposes, that would also be all right.
LORD PEDDIE: Thank you.
On Question, Amendment agreed to.
LORD AIREDALE LORD AIREDALE moved, in subsection (5), to leave out "normally" and insert "regularly". The noble Lord said: My Lords, this Amendment is a further attempt to bring the established trade shows and exhibitions, agricultural shows, and so on, within the definition of "appropriate trade premises", so that the cooling-off period will not apply in that case just as it does not apply to transactions which originate in the dealer's showroom. I think it is ironical that the cooling-off period, which was originally aimed at the high-pressure, door-to-door salesman should have hit, for instance, the Motor Show. I know that it has been said that on occasions visitors to these trade shows run away with themselves in their enthusiasm; on the other hand, such shows enable visitors to see the full range which an industry has to offer. They can choose the goods best suited to the purposes; from a wider range than is likely to be found in most dealers' showrooms. So that, on balance, I should have thought that the great exhibitions were to be likened much more to a dealer's showrooms than to the activities of the door-to-door salesman.
The Amendment on these lines which I moved in Committee had the support, to a large extent, of the noble Lord, Lord Peddie, who expressed approval of these established exhibitions though he pointed out that my Amendment was too widely drawn and would have given shelter to what the noble Lord referred to as "fly by night" traders. The Minister also took this view, and on reflection I appreciate that both noble Lords were quite right. I hope that the present Amendment, which is more narrowly drawn, will be satisfactory. It will have the effect of amending the definition of "appropriate trade premises" in this way. At present the definition uses the words:
"premises at which goods are normally offered for sale".
With this Amendment the definition would be:
"premises at which goods are regularly offered for sale".
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I am hopeful that the word "regularly" will enable the courts to hold that exhibitions held regularly in one particular premises will come within the definition of "appropriate trade premises", notwithstanding that the exhibition may last for only a few days in the whole year. This definition would not be perfect. For instance, there are many well-established travelling shows and exhibitions—I think of the Game Fair—which would not be covered. On the other hand, I am no longer giving shelter to "fly by night" traders, because regularity is the very last quality which such people cultivate. I hope that the Minister will find the Amendment acceptable. I beg to move.
Amendment moved—
Page 4, line 17, leave out ("normally") and insert ("regularly").—(Lord Airedale.)
LORD DRUMALBYN: My Lords, I congratulate the noble Lord on his pertinacity and the ingenious nature of his Amendment. Just as I was advised originally, as a matter of drafting, that the word "normally" would not cover trade fairs and exhibitions, I am advised that, as a matter of construction, there is at least doubt whether the word "regularly" has any definite meaning. Its introduction would therefore give rise to doubt whether particular agreements were or were not within the scope of the cooling-off provisions. We are anxious that there should not be that sort of doubt; we believe that that would be unsatisfactory. It is, in any case, a matter for argument whether the cooling-off provisions should or should not apply to agreements concluded at the trade fairs. Your Lordships will remember that my noble friend Lord Stonehaven raised this point on the Second Reading. I was not certain at that time whether or not he thought that such agreements should apply to trade fairs, and I discovered that he was strongly opposed to their applying. So there is, at any rate, a difference of opinion on this.
It is very difficult not to open the door much more widely than one intends to. The noble Lord quite agrees that we ought not to exclude from the cooling-off provisions "fly by night" activities. But I am not at all certain that it is not possible to "fly by night" regularly. I am not at all certain that it would not be possible to have a shop

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regularly open one day in a year, or in a month, or something of that kind. This just illustrates the difficulty that we are up against. In a case like this we should always have to ask: is anybody really going to be prejudiced by including exhibitions and trade fairs? The noble Lord talked about the Motor Show being hit by this, but is it really going to be hit? As a result of these provisions, how long a delay will there be in the delivery of a motor car to a person who orders? As I said, it is a matter for argument whether or not in this particular kind of case there should be a cooling-off period. Some people have held the view that the cooling-off provisions should extend much more widely than we have made them extend, but in this kind of case it is at least a matter for argument whether they should or should not extend to this.
What I do say is that this will give rise to uncertainty. The word "regularly" is itself not a precise word, and one cannot be certain that, as a matter of interpretation, it would include persons exhibiting at exhibitions, even though they did so regularly; and, certainly, might very well not do so if they were not doing so regularly. So for these reasons I think it would be wise for the House to maintain the provision as it is at present in the Bill.
LORD AIREDALE: My Lords, I am very much obliged to the Minister for his careful and considered reply. He reminded me of a former Lord Chancellor who said on one occasion of counsel who was appearing before him, that unfortunately counsel did not have a very strong case to argue and he was driven back to the ultimate virtue of persistence. I think that is what I was accused of just now. This is not a matter for which I am prepared to go to the stake, and I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
6.13 p.m.
VISCOUNT HANWORTH VISCOUNT HANWORTH moved, after subsection (6), to insert:
"(7) This section shall not apply to any transaction in respect of which the antecedent negotiations are conducted wholly by post."
The noble Viscount said: My Lords, this is a straightforward Amendment which was moved in Committee. The
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effect is that the hirer or buyer will not have a cooling-off period in which he can cancel an agreement, if the antecedent negotiations are conducted by post. Clause 19 of the Bill, at the top of page 20, defines antecedent negotiations as meaning
"any negotiations or arrangements with the hirer or buyer whereby he was induced to make the agreement or which otherwise promoted the transaction to which the agreement relates".
This definition is stringent, and there is therefore no reasonable possibility of the Amendment producing any weakness in the legal protection afforded by the Bill.
On principle, it seems quite unreasonable that a buyer or hirer should be allowed to change his mind when he has had as much time as he wants to consider whether or not to sign a document, and has been under no outside pressure. It would be far more logical for a protection to apply to a signature on trade premises, but for good reasons this has been specifically excluded from the Bill. From a practical point of view, there are grave objections to allowing a cancellation of postal transactions. In the first place, it will cause considerable delay. The cooling-off period of four days runs from the time the buyer receives a copy of the agreement signed by the seller. The seller must then wait for the four days cooling-off period to elapse, and allow time for possible cancellation to reach him through the post before he can safely despatch the goods. The delay which the four-day pause period imposes on any transaction can hardly be less than eight days, and may well be more. Although the pause period is a very necessary safeguard, in certain circumstances it makes it more difficult to be certain that a valid contract exists. For example, a letter of cancellation or the copy agreement may be lost in the post, or the customer may claim that the letter has been mislaid in the seller's office. For this reason it is a safeguard which should be applied only where it is absolutely necessary.
I would strongly rebut the Government's argument that this Amendment complicates the Bill. In fact, I think the reverse is true. It has been suggested that the majority of mail order transactions do not exceed £20. While

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this is true so far as numbers of orders are concerned, the annual turnover of items which are over £20 runs into millions of pounds and is very far from negligible. At the Committee stage the Minister objected to the Amendment on the ground of additional complication, and said that the Bill as it stood would not cause any serious inconvenience to the mail order trade. I think I have covered these points. A further objection may be the fear that some firms will ignore Clause 19 of the Bill, and will exert pressure on the customer through sales agents. It is always possible to take a risk and allow a customer to believe that a contract is irrevocable, but I do not believe that this Amendment will make this sort of thing any more likely. It has been pointed out that the onus of proof of illegal behaviour would lie with the customer, that he is the weaker party, and that this is undesirable. But I do not think this argument is a very strong one, because it probably applies to a large number of clauses in the Bill in any event. I hope that, unless the Minister can give some more conclusive reasons against this Amendment, he will have considered it very carefully. I beg to move.
Amendment moved—
Page 4, line 40, at end insert the said subsection.—(Viscount Hanworth.)
LORD SHEPHERD: My Lords, I hope that the Government will not accept this Amendment. I have at various stages of this Bill tried to widen the area in which business could be conducted without the cooling-off period, but I have always been very careful not in any way to infringe the principle enshrined in the Bill, that any agreement that is signed in the home should be subject to the cooling-off period. The noble Lord obviously has in mind mail order houses. Those of which we know, and I will not mention them by name, have a considerable reputation which they deserve for the way in which they conduct their business. But the noble Lord will recognise that in the morning newspapers on Fridays and Saturdays there is a mass of advertising material for these small groups of peculiar companies, with names completely unknown to the general public.
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As I see it, if the noble Viscount's Amendment were to be accepted, a person replying to such an advertisement and then entering into an agreement would not be subject to the cooling-off period. If all the negotiations were conducted by correspondence, the noble Viscount might have a case. But we well know that replies to that type of advertisement bring the high-pressure salesman. By and large, the high-pressure salesman does not move down the street going from house to house; he answers the replies to advertisements in the papers. I believe that, if the noble Viscount's Amendment were accepted, instead of it being clear to everyone, particularly to the householder, that under the Bill an agreement signed in his home enjoys the cooling-off period, the onus of proof would lie upon the housewife to prove that a salesman had intervened at one stage or another. It would be subject to dispute, but the onus of proof would lie clearly upon the housewife. I think this would move this particular clause, which we have all welcomed, away from giving the advantage to the housewife, and on that ground I would beg the Government not to accept this Amendment.
VISCOUNT HANWORTH: My Lords, I should just like to make one point. I did mention that I was aware that the burden of proof would lie on the housewife, but I also said that this applied to a very large number of clauses in the Bill. I do not think the noble Lord, Lord Shepherd, met that point.
LORD DRUMALBYN: My Lords, I would agree with the noble Lord, Lord Shepherd, that this would represent a breach of the principle that where a document is signed in the home then the cooling-off provisions should apply. Of course, if there could be any strong reason shown that prejudice would be caused to either party, one would be very willing to consider the case. I said this on the Committee stage, and I have received correspondence concerning this matter, but it has not been represented to us that there would be any prejudice arising. The noble Viscount, Lord Hanworth, speaks about delay, and considerable delay. I do not want to go over again what I said on the Committee stage, but I think it is worth saying that I would have expected a very large

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amount of mail order business to be covered by three categories: first, cash transactions; second, credit sales for less than £20, which are outside this; and, third, hire-purchase and credit-sale transactions where, in the nature of the goods, delivery is in any case not likely to be immediate. I should have thought that these categories covered most of the mail order business. So I must say that there has been no strong case of prejudice made out either to the hirer or to the mail order business in this regard.
However, I should like to add that it is true, I am told, that in certain cases agents or salesmen assist in the pushing of mail order business. The difficulty is that if one were to exclude all transactions in respect of which the antecedent negotiations are conducted wholly by post, then in that case the hirer would have no means of knowing at all that he or she had cancellation rights if a salesman or an agent intervened in transactions. The whole of this protection depends upon the information given of the cancellation rights; but in this case, if it were done in this way, there would be no means of knowing. I think this is important. Personally, I do not know the extent to which salesmen and agents, other housewives and so on, working on commission, intervene in these cases, but I must say that I do not think that any strong prejudice can arise from this. Therefore, with regret, I feel that we must adhere to our rejection of this Amendment.
VISCOUNT HANWORTH: My Lords, as the Minister has considered this matter very carefully, I would not want to press it further. I beg leave to withdraw.
Amendment, by leave, withdrawn.
Clause 4 [Information as to right of cancellation]:
LORD DRUMALBYN LORD DRUMALBYN had given Notice of an Amendment to add to subsection (2):
"find as if, in paragraph (dd) of the said section 2(2) and in paragraph (cc) of the said section 3(2). sub-paragraph (i), and in subparagraph (ii) the words 'in a case not falling within the foregoing sub-paragraph', were omitted."
The noble Lord said: My Lords, I beg to move Amendment No. 15A. May I start by drawing attention to a typographical error? The first word to be
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inserted is not "find" but "and". That will probably make more sense of the Amendment. In formally moving this Amendment I should like to speak also to Amendment No. 33A. These two go together—indeed, No. 33A contains the substantial provisions.
When your Lordships were considering the Bill on Report on January 30 an Amendment was carried to Clause 3, page 3, line 29. Looking back over the discussion, I think it is fair to say that the main concern expressed by noble Lords was that a person who signed a document which was, or might become, a hire-purchase or credit-sale agreement should immediately have a copy of it to retain, regardless of his entitlement to receive a further copy at a later stage. The noble Lord, Lord Peddie, challenged me to say whether or not I accepted this principle, and when I said that I reserved my position he pressed his Amendment to a Division. But I think that was the main point; I do not think there is any dispute about that.
Although the Amendment under discussion referred to cases where the cooling-off provisions apply, a good deal of what was said would be equally valid in the ordinary case—where, for example, the hirer signs the document at a shop. Indeed, when the same Amendment was discussed during the Committee stage such cases were specifically mentioned—in particular, I think, by the noble Baroness, Lady Burton of Coventry, who has been good enough to apologise to me for not being present this evening. If noble Lords will forgive me for saying so, the Amendment as carried would be ineffective, since it provides that the hirer shall "retain" a copy of the document. The intention, of course, is that a copy should be given to him. This is a matter of drafting. It is therefore, in any case, necessary for there to be some redrafting. In accepting the principle, we have felt that it should be applied to all cases. We have therefore produced Amendments to do that. The intention, as your Lordships are aware, is to complete the Report stage to-day and to take Third Reading on Thursday; and, if we had tabled these Amendments for Third Reading, the result would have been that they would have appeared on the

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Order Paper for the first time on the day on which they were taken. I do not think the House would have considered that satisfactory, and I have therefore put them down for to-day, although in consequence Amendment No. 33A appears later in the Bill than it will when it is in its proper place. But my intention is not to ask your Lordships to decide on these Amendments to-day. If your Lordships please, I will explain briefly what they do and will then seek permission to withdraw them. I will then put the Amendments on the Paper again for the Third Reading.
Amendment No. 33A contains two subsections which deal in the same terms with hire-purchase agreements and with credit-sale agreements. It seems to us that there are three circumstances to be provided for. The first is, in effect, the case where the document is signed at a shop by all parties and the statutory copy is handed over there and then. In these cases no additional copies are necessary. Secondly, there are cases where what is handed to the hirer to sign is an offer which will become an agreement if accepted by the other party. In these cases we provide for him to be given a copy of what he has just signed, which I think is the intention the noble Lord, Lord Peddie, had in the case of cooling-off agreements. Thirdly, there is the possibility that the document may be sent through the post to the hirer. In these cases we provide that a copy must be enclosed. These three cases, then, are covered in sub-paragraphs (i), (ii) and (iii) of each subsection of the new clause. As in the case of other similar requirements in the 1938 Act, failure to comply with these provisions renders the agreement unenforceable, but the court has a power of dispensation to exercise where it considers that the hirer has not been prejudiced.
Amendment No. 15A, which we are now considering, makes clear that the first category of which I spoke—the case where the statutory copy is handed over at the time of signature—cannot arise where the right to a cooling-off period is applicable. Your Lordships will remember that in those cases a statutory copy must be sent through the post; so in a cooling-off case, even if the salesman
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is empowered to sign for the owner or seller, and the agreement is completed on the doorstep, one copy will be left with the hirer but the statutory copy will still have to go through the post drawing the hirer's attention to the cooling-off right and starting the time running within which he can still exercise it.
I said earlier that I thought the discussion on the Amendments carried on January 30 centred on the question of giving the hirer a copy of what he signs. The Amendment, in fact, went further, and required that that copy should contain the name and address of the person to whom cancellation may be delivered and to whom the goods may be returned. I suggest that this is a separate matter and should be looked at on its own merits. There are a number of Amendments down to the various provisions governing cooling-off right, and there are some respects in which these provisions might be improved, although we have not been able in the short interval since Committee stage to work out Amendments to meet them. I feel, however, that we must not lose sight of the main purpose of these provisions, which is to provide a simple way in which a person who has been browbeaten by a visiting salesman can later withdraw.
We were at pains, in drafting the Bill, to ensure that this right would be simple to exercise and easy to understand; that it should offer salesmen as few chances as possible of circumventing, and, in particular, that it should come to the hirer's notice, in terms that we shall prescribe at a time when the salesman is not there. I suggest that there is no difference of intention between us. It would be prejudicial to the hirer if part of the information, and the most vital part, were contained in the document handed to him by the salesman. The vital part is, first, whether he has the right, and secondly, the effect of his exercising that right.
I have not covered those aspects in the Amendments I have placed on the Order Paper which, if carried, would also involve the reversal of the Amendment carried on January 30. We are prepared to try to improve the cooling-off provisions, if we can; but I hope that when I offer to deal effectively with the point which I believe led the majority of your Lordships to vote as you did, it will be accepted that the question of notifying

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a hirer of how he can make a cancellation, and what to do if he does, will be dealt with in the context of the mechanism of the safeguards as a whole. I do not know whether your Lordships wish to discuss now the Amendments on the Order Paper or whether you would prefer to consider them between now and the next stage. I am in your Lordships' hands; but I will either withdraw now or, if your Lordships wish to comment on them, later. I beg to move.
Amendment moved—
Page 5, line 15, at end insert ("and as if, in paragraph (dd) of the said section 2(2) and in paragraph (cc) of the said section 3(2), subparagraph (i), and in sub-paragraph (ii) the words in a case not falling within the foregoing sub-paragraph,' were omitted.").—(Lord Drumalbyn.)
LORD PEDDIE: My Lords, I appreciate the noble Lord's attempt to explain to the House the circumstances concerning the two Amendments appearing in his name, and particularly No. 33A. I appreciate, as I am sure the House will, the opportunity to defer the detailed discussion on these two Amendments until later when we have had full time to consider all the implications. I would at this stage make it quite clear that this House had no doubt at all about what it was voting on earlier when it voted on Amendment No. 12. While it is true that emphasis was given to the point regarding the leaving of a copy of the agreement, at the same time noble Lords clearly understood the other part of that Amendment, which related to the duty to give the particulars of the name and address of the person to whom cancellation might be delivered and to whom the goods might be returned. That is what we voted on. My first rapid glance at Amendment 33A does not seem to show there is any reference at all to the name and address of the person to whom the goods should be returned. However, I appreciate the offer to the House to discuss this question in more detail at a later date.
LORD SHEPHERD: My Lords, I agree with my noble friend that we should consider this point on Third Reading; but I am sure the House will recognise our difficulty. When we reach the Third Reading then, so far as we are concerned, we have come to the end of the road and there is nothing further
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we can do about it. The noble Lord said that we should make it clear to the prospective hirer what are his rights. We are all agreed on that. But I am sure the House will recognise that, having given the rights, we must find some way in which the prospective hirer can carry out and have the full effect of those rights. It seems to me that these words which we have drafted into the Bill, by the vote on Amendment No. 12, must be somewhere included in the agreement.
What I have in mind is this: that there may be hire purchase companies that take fourteen to twenty-one days before they return the requisite copy. Presumably, that copy would have details, in the case of the cooling-off period, of the person to whom cancellation can be made or the goods returned. But I should have thought that the prospective hirer would be in a very difficult position. He has been forced to retain the goods against his will, perhaps, for quite a long time; he may have been using them. He would be under considerable moral pressure to retain the goods and let the hire-purchase agreement go through merely because those goods have been left in his premises. I think we must make the position quite clear in the agreement that if the man wishes to effect cancellation he shall have the information to carry out that intention and to return the goods to the dealer or the owner. I beg the Government to consider this point favourably between now and the next stage.
LORD AIREDALE: My Lords, may I put forward a suggestion for a small drafting Amendment of Amendment No. 33A? Paragraph (i) which it is proposed to insert in Section 2(2) uses the expression "there and then". I doubt whether this is an expression known to the Statute Book so far. It seems to me to be a colloquial expression. Surely, the equivalent expression in Statute Law is "thereupon". I feel we should not unnecessarily extend the vocabulary of the Statute Book, and that we should stick to time-honoured expressions whose meaning is known to everybody.
BARONESS ELLIOT OF HARWOOD: My Lords, I should like to thank the Minister for having put down these two Amendments in order to meet the wishes

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of the House. Like noble Lords opposite, I have not had very long to look at them; they are complicated, but they seem to a considerable extent to fulfil the wishes of noble Lords when they voted last week. I hope it may be possible to do what the noble Lord, Lord Peddie, mentioned in his Amendment—namely, to provide that particulars of the name and address of the person to whom cancellation may be delivered and to whom the goods may be returned shall be included in some part of the arrangements. I think it is a necessary thing. Whether it should come into the actual Amendment or not is a matter of drafting, so long as the purpose is in the Bill. I would thank the Minister for acting so speedily in this matter.
LORD HAWKE: My Lords, I am not quite sure whether there is a time limit for the return of goods; but we must remember that the return of goods too large to go by post can now be an extremely difficult operation in some parts of the country, because there will no longer be a railway station to which one can go and send them by passenger or goods train. Sometimes it will mean a lengthy journey to the nearest centre and, owing to this, it is not always possible to return them in a short time.
LORD DRUMALBYN: My Lords, I should like to deal with the last point first. It gives me the opportunity to clear up a misunderstanding now. It cannot be said too often that there is no responsibility, no duty, on the hirer to return the goods. The normal course will be for the dealer to come and collect the goods. So, while my noble friend Lord Hawke may be on a good point about a time limit, it would not be a time limit for the hirer to return the goods, though there may be something to be said for a time limit within which the dealer should take the goods back.
I think it would be desirable that, when we part from this Bill in your Lordships' House, it should be in a respectable form; that is to say, it should not have any obvious flaws in it. One of the difficulties which, I am afraid, I could not get over is that, even if we thought it desirable to implement the second part of the Amendment that was carried into the Bill last Thursday—
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that is, that the copy agreement should contain particulars of the name and address of the people to whom goods may be returned—we are not in a position to prepare an Amendment in time; so that, if your Lordships agree, it is something we shall have to allow the other place to consider. There is no means of accepting the principle of this.
In Clause 6 we are going on to consider this very point, admittedly not with regard to the inclusion in the copy, but with regard to the whole complex of what happens if a contract is frustrated and things have to be put back as they were, and I do not think that we need spend more time on this now. With that short explanation, I hope that it will be your Lordships' pleasure that this Amendment should be withdrawn.
Amendment, by leave, withdrawn.
LORD DRUMALBYN: My Lords, during the Committee stage of the Bill, I promised the noble Lord, Lord Airedale, that we would look again at the powers to make regulations given to the Board of Trade under Clause 4 of the Bill, with the object of making sure that the powers were wide enough to enable the Board to prescribe that the copy of the agreement, which must be sent to the hirer or buyer, must draw attention to his rights and liabilities under Clause 6. This Amendment, and that to line 37, make sure that our powers will enable us to do this, if we think it desirable. I hope that this will satisfy the noble Lord and that, in the light of these Amendments, he will not feel it necessary to move his Amendment No. 32A.
Amendment moved—
Page 5, line 23, after ("to") insert ("or consequential upon").—(Lord Drumalbyn.)
LORD AIREDALE: My Lords, I am very grateful to the Minister and I will give practical expression to my gratitude when we come to Amendment No. 32A by not moving it.
On Question, Amendment agreed to.
6.45 p.m.
LORD PEDDIE LORD PEDDIE moved, in subsection (3,e), after "sent" where that word occurs the second time, to insert:
"and the name of the person to whom, and an address to which, the prospective hirer

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may deliver the goods under section 6 of the Hire Purchase Act 1963,".
The noble Lord said: My Lords, I may be in some difficulty in moving Amendments Nos. 17 and 19 together, because I am not certain whether the Minister has accepted the principle involved in these Amendments. I was hoping that I might be in a position to withdraw these two Amendments. Judging from what was said a few moments ago, it would appear that I cannot. If your Lordships will refer to Clause 4, you will see that it deals with information about the right of cancellation. As we have said repeatedly from this side of the House, in the fulfilment of cancellation, there is need for the hirer to receive the fullest possible information and the inclusion of the words in my Amendment makes it easier for the hirer, after he has exercised the right of cancellation, to know the name and address of the person to whom the goods should be returned. This is important, because the person to whom the goods may be sent is not necessarily the same person as the one from whom the hirer had acquired the goods.
When this was discussed at Committee stage, the Minister, in objecting to the Amendment, said that there may not be a copy of the agreement in existence before the right is exercised. Now, of course, that argument no longer stands, because the House agreed to an Amendment whereby a copy of the agreement would be left with the hirer at the time of signing and this copy would include the name and address of the person to whom goods would be returned. Therefore, the House has already accepted the principle which is involved in this Amendment and in No. 19.
The second point which was made at Committee stage was that there was no obligation on the hirer to return goods to any particular place. Indeed, the noble Lord repeated that statement a few moments ago. I agree with that statement, but I would point out that in Clause 6(1) it is stated that the hirer may at his own expense redeliver the goods. Therefore, if the conditions are such as to justify the return of the goods, why in heaven's name refuse to allow the name and address of the person to whom the goods should be
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returned to be inserted so that the hirer may exercise the right given him in Clause 6(1)? There is a further Amendment dealing with this point. I hope that the Minister will accept these two Amendments, an act which I am sure will be welcomed by this House, because the principle involved here has already been decided by the House when it agreed to accept Clause 12. I beg to move.
Amendment moved—
Page 5, line 27, after "sent" insert the said words.—(Lord Peddie.)
LORD DRUMALBYN: My Lords, first of all, may I say again, because I think it is particularly relevant to this Amendment, that when a hirer serves notice of cancellation under the cooling-off provisions he is thereby under no obligation to take action himself to return the goods. For this reason, there is no need, from his point of view, for a person to be nominated in the copy agreement. As I have said before, what we would normally expect is that the dealer who supplied the goods would collect them again from the house of the prospective hirer. This is provided for in Clause 6(1)(b). But we also felt that it was necessary to provide for the case where goods were left by the salesman and where the hirer's immediate and natural reaction was to take the goods straight back to the dealer.
The noble Lord, Lord Shepherd, pointed out that in some cases there would be no local dealer, but surely, in such cases, the hirer will simply keep the goods until they are collected, particularly in cases where it is too much trouble to pack up goods and return them. So to insert in the statutory copy of the agreement the name and address of the person to whom the goods may be returned could easily confuse the hirer. I would ask your Lordships to appreciate this.
There are two quite distinct cases to be considered. One is where the goods have been left by the salesman, and the other is where the salesman has simply taken an offer to acquire the goods on hire-purchase and the goods are to be delivered later. There is no point, surely, in specifying in the agreement the name of the person to whom the goods can be returned if the goods have not been delivered before the cooling-off period I elapses. In many cases the goods will

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not have been delivered before the copy of the agreement arrives, and to insert the name and address of the person to whom the goods can be returned could confuse him in one of two ways: either he might think that, even although he had not exercised his rights under the cooling-off provisions, he had the right to return the goods when they were delivered later on—and he would be wrong about that—or, if the goods had been delivered before he received a copy of the agreement and when he received the copy of the agreement he exercised his right to cancel within four days, he might feel obliged to return the goods at his own expense. By putting this in, it puts excessive emphasis on that point.
I would ask noble Lords to appreciate that this particular subsection is an important one, because it adds an additional paragraph to subsection (2) of Section 2 of the principal Act, which gives the circumstances in which the owner cannot enforce the agreement against the hirer. So it is a matter of great importance. It is going to make the thing unenforceable if he does not do it. Is it right to make it unenforceable in circumstances where it is not even applicable? As I pointed out, in many cases it would not be applicable. Therefore, I do not feel that this would be the right way to deal with it.
The noble Lord says that we have already carried into the Bill a provision dealing with this matter; but, as I pointed out when we were discussing that provision, there is no way of enforcing it at all. Here he is putting this into a slightly different provision—a provision that into the copy of the agreement when it is sent there should be this information—and he is making the whole agreement unenforceable if that is not done. That seems to me to be an extraordinarily extreme thing to do. After all, even if in inserting this information in the copy which is left, if it were desirable to enforce that, it would not by any means be necessary to enforce it by making the agreement itself unenforceable if that were not done. These things are not on a par at all, and I think it would be unwise for the Opposition to press this point, bearing in mind that they are pressing something which in many cases is not applicable.
LORD SHEPHERD: My Lords, the noble Lord has referred to "the Opposition": I hope he will think again on that word. This is not the Opposition speaking. This is not a Party matter. We are looking at this Bill united on all fronts in the interests of those who take part in hire-purchase transactions.
LORD DRUMALBYN: Would the noble Lord accept an amendment to that expression? I was thinking of noble Lords opposite rather than the Opposition.
LORD SHEPHERD: Quite. I hope my noble friend will press this Amendment, because I think it is of considerable importance. In Clause 6 it says:
"The prospective hirer may at his own expense deliver the goods to the dealer at any relevant premises."
The reason why we feel that the prospective hirer, when he has cancelled his hire-purchase agreement, should be able to return the goods is, as I said on an earlier stage, the sort of advantage the hire-purchase company might have over him because the goods had been retained in his premises for some time. There is the other point: that the longer the goods remain in the hirer's home, the greater are the opportunities of damage to them. As we lay upon him in Clause 6(2) a responsibility to pay damages that may arise, it may well be that the hirer, in his own interests and also those of the owner, having decided that he is not going to proceed with the agreement, will say: "Please take the goods away"; and if they will not take the goods away, at least he can deliver them himself. If the Government do not accept this Amendment and the hirer has no knowledge as to whom he can return the goods, we shall be limiting the cooling-off period of four days. The noble Lord shakes his head, but that is the period.
LORD DRUMALBYN: We are now considering a different point. We are considering the copy of the agreement that is sent through the post, not the copy of the offer which is left in the first place with the hirer.
LORD SHEPHERD: But is it not a fact that the cooling-off period starts from the day on which the requisite copy is received by the hirer? That is my

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understanding of the cooling-off period. It may well be, as it now is, that the hirer may have 7, 10, 14 or 21 days before he receives the requisite copy, according to the time which the hire-purchase company may take in delivering the requisite copy. I should have thought we ought to make it possible for the hirer who decides to cancel the agreement to be able to operate and return the goods during that period, and he should not have to wait until he receives the copy with the information before he returns the goods. I feel that there is a strong case here. It is not, as I say, a Party matter. We are all acting, I am sure, in the interests of the hirer and the hire-purchase company. I believe that if this information is available to the hirer it will be for the benefit of the hirer and also of the hire-purchase company.
LORD AIREDALE: My Lords, I think the principle of this Amendment is well worth fighting for. There must be many classes of people who would much rather return the goods to the dealer if only they knew clearly where they should take the goods. There are people on night duty who do not want to be knocked up during the day by a dealer coming in to collect the goods. There are students and unmarried people who go out to work, from whose homes no dealer would be able to recover anything, because they are never at home during business hours. These people ought to have every opportunity to return the goods to the dealer, and should be clearly told where the dealer lives so that they may do so.
LORD CHAMPION: My Lords, while agreeing with my noble friends and with the noble Lord, Lord Airedale, on this matter, the last thing I want to see happen is the onus being placed on the hirer to return the goods, because that might raise a number of difficulties, such as that of packing, which was mentioned by the noble Lord. I think there is something in what my noble friends have said; but if we accept an Amendment of any sort, I hope we shall not place the onus on the hirer to return the goods.
LORD HAWKE: My Lords, I think it would be clear—admittedly I have had to read this clause once or twice—if we
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inserted at some stage of the Bill that the prospective hirer or buyer may return the goods, if he wishes, at his own expense; and paragraph (b) goes on to say that if he does not choose to do so the dealer has to pick them up. Surely the principle in general is a sound one. If you entered into a transaction and have regretted it, and the law allows you four days to decide whether you regret it or not, surely the sooner you are quit of the goods the better. I heartily support the idea that a man should know where to send the goods back should he exercise his right to cancel the contract.
7.0 p.m.
LORD DRUMALBYN: My Lords, by leave of the House, may I say just a word about this, because I want to clear up what I think is still a misapprehension here? We were talking on Thursday about the copy of the offer which is left originally with the hirer, and it was suggested that the name and address of the person to whom the goods could be returned should be included. I think that was the intention. I am not certain that the Amendment does that. Now the noble Lord talks about the delay before the requisite document may arrive. That does not arise on this Amendment; it arises on the Amendment we were talking about which has already gone into the Bill. On this Amendment, there are the four days for cooling off, and then it is for consideration whether or not after that the words that should be added to this clause should be put in and the place specified to which the hirer can return the goods, whether it is in the copy of the Agreement or not. That is the point at issue.
Noble Lords may be on quite a good point here: that there should be some time limit within which the goods should be collected. That is arguable, and is one of the points we are looking at. But it is not what the Amendment says here. In the normal way, it will be for the dealer to collect his goods. We have given the hirer the facility of returning them in order that he may be absolutely in order in returning the goods to the dealer, otherwise it might be considered that he had returned the goods to the wrong place, or something of that sort. The main purpose is, first of all, to let him take the goods back to the dealer

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if they are portable and easy to get rid of, and he wants to get rid of them, but also to ensure that he is in order in taking the goods back to this particular person. It is quite a different thing to insert into the agreement the name and address of the person to whom he can return the goods, because we feel it would be very misleading to him. In so many cases he will not at that stage—the operative stage when he receives the copy of the agreement—have the goods at all.
LORD PEDDIE: My Lords, I am quite sure that the majority of your Lordships will agree that the reply we have heard is quite unsatisfactory. The noble Lord opposite, in replying to the points which have been raised, has ranged well beyond Amendments Nos. 17 and 19, and much of what he had to say related to Amendment No. 21. The position is quite clear. The principle enunciated in these two Amendments has already been accepted by this House. In my opinion, it is wrong to argue that there would be extraordinary legal difficulties in implementing this Amendment. The noble Lord made reference to the fact that there is no obligation to return the goods. We know that, and that statement has no bearing at all on the arguments that are being advanced in support of these Amendments. The Amendment merely indicates that if the hirer wishes to return the goods he will have in his possession the name and address
of the person to whom they should be returned.
One can appreciate the importance of this Amendment, which I am quite sure the noble Lord opposite does not. There can be circumstances where the door-to-door salesman—against whom much of this Bill is directed—could be taking round with him equipment of some kind, maybe electrical equipment, which he leaves with the hirer. The noble Lord made a point about the hirer having a copy of the agreement, and later having a copy of the document which will date the time of the four-day cooling-off period, but it may be considered in the interests of the agent not to collect after cancellation, in order that he may be able to go back at some time and persuade or coerce that individual hirer into renewing the agreement. Therefore, the woman who is anxious to get rid of the goods needs the name of the person so that she can drop a short note and tell the person to collect them. The difficulties the noble Lord opposite mentioned are utterly beside the point. I would appeal to noble Lords to accept this Amendment, because they have already accepted it in principle in Amendment No. 12, which this House accepted. Therefore I have no alternative, in the interests of the Bill, but to press this Amendment.
7.8 p.m.
On Question, Whether the said Amendment (No. 17) shall be agreed to?
Their Lordships divided: Contents 33; Not-Contents 34.

CONTENTS

Airedale, L.

Forster of Harraby, L.

Ogmore, L.

Albemarle, E.

Gaitskell, B.

Peddie, L.

Alexander of Hillsborough, E.

Gardiner, L.

Raglan, L.

Attlee, E.

Grenfell, L.

Shepherd, L. [Teller.]

Auckland, L.

Hanworth, V.

Somers, L.

Burden, L. [Teller.]

Hawke, L.

Stonham, L.

Champion, L.

Henderson, L.

Strabolgi, L.

Colville of Culross, V.

Hobson, L.

Summerskill, B.

Crook, L.

Lawson, L.

Taylor, L.

Elliot of Harwood, B.

McNair, L.

Walston, L.

Ferrier, L.

Milner of Leeds, L.

Williamson, L.

NOT-CONTENTS

Ailwyn, L.

Drumalbyn, L.

Jellicoe, E.

Allerton, L.

Dundee, E.

Lansdowne, M.

Balerno, L.

Effingham, E.

Lothian, M.

Bessborough, E.

Falkland, V.

Mabane, L.

Blakenham, V.

Ferrers, E.

McCorquodale of Newton, L.

Bossom, L.

Fortescue, E.

Newton, L.

Conesford, L.

Goschen, V. [Teller.]

St. Aldwyn, E. [Teller.]

Coutanche, L.

Greenway, L.

St. Oswald, L.

Daventry, V.

Hastings, L.

Stonehaven, V.

Denham, L.

Horsbrugh, B.

Swinton, E.

Derwent, L.

Iddesleigh, E.

Teynham, L.

Dilhorne, L. (L. Chancellor.)

Resolved in the negative, and Amendment disagreed to accordingly.
LORD DRUMALBYN: My Lords, the next Amendment is consequential. I beg to move.
Amendment moved—
Page 5, line 37, after ("to") insert ("or consequential upon").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
Clause 6 [Rights and obligations on service of notice of cancellation]:
7.16 p.m.
LORD PEDDIE LORD PEDDIE moved, after subsection (1)(a), to insert:
"(b) the prospective hirer or buyer may send a notice in writing to the owner or seller, or to the person specified in the requisite copy as being the person to whom the goods may be delivered, requesting such person to take delivery of the goods (subject to subsection (4) of this section and subsection (3) of the next following section) at the premises which, in the relevant document, are specified as the address of the prospective hirer or buyer;".
The noble Lord said: Paragraph (a) in this clause of the Bill refers to the fact that the hirer—we have already had some little discussion on this matter—may return the goods to the dealer at his own expense. Paragraph (b) says that if he does not deliver he shall be under an obligation, at the request of the dealer, to deliver the goods to him at premises specified as the address of the prospective buyer or hirer. In other words, the dealer can instruct the hirer from whom he intends to collect the goods. The new paragraph suggested in this Amendment deals with a circumstance that is not covered in the two paragraphs. There may be the circumstance—and, indeed, I have already referred to this when speaking on a previous Amendment—where the owner or the agent may not ask for the return of the goods and the hirer may not be able to deliver. This new paragraph asks for the right of the hirer to call upon the owner or seller to collect the goods. There are obvious benefits which could arise from this, benefits that we have already considered, to enable the hirer to indicate to an owner the need for those goods to be collected. I indicated at Committee stage the possibility of such a provision for a request being useful so far as possible litigation is concerned. The noble Lord opposite was not prepared to accept that suggestion, but now I am confident that I
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am right that in these circumstances there could be occasions when the possession of a copy of the letter requesting the collection of those goods that are deliberately left with the hirer could be an advantage to the hirer himself. I beg to move.
Amendment moved—
Page 6, line 37, at end insert the said paragraph.—(Lord Peddie.)
LORD DRUMALBYN: My Lords, the point that the noble Lord has made has some substance, in that it might be that for one reason or another the dealer left with the hirer for some considerable time the goods which he ought to have collected. It seems to me that that is very unlikely to happen. The dealer would, in those circumstances, almost be leaving the goods in order that they might be damaged before he collects them. As I said, it seems to me that it would be an extremely rare thing to happen. But the fact is that it may be required for the protection of the hirer that that should not be allowed to occur, because, obviously, the longer the goods stay there, the greater the likelihood is of damage. This factor is what we are looking at.
But I would submit, with great deference to the noble Lord, that the Amendment he has here would be totally inoperative. He says the prospective hirer may send a notice. Of course he may send a notice. That does not give him a right he has not got. He can send a notice at any time. If he does send a notice, what happens if the dealer does not comply with it? All these questions have to be considered, and they are not actually set forth in the Amendment. The Amendment does not even say that the owner or seller or person to whom the goods are delivered shall comply within a certain time. We are inclined to think that there is a problem here, but we are not certain that this is the right way to deal with it. We intend to deal with this in some way or another before the further stage.
LORD PEDDIE: My Lords, that would indicate that the noble Lord has accepted the principle and has paid us the compliment of agreeing that there is a valid point expressed in this Amendment. With that assurance, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
7.22 p.m.
LORD PEDDIE LORD PEDDIE moved, in subsection (1)(b), to leave out "request of the dealer" and insert:
"written request of the owner or seller or any person who is the agent of the owner or seller".
The noble Lord said: My Lords, if I may, I will deal with numbers 23, 24 and 25 together. These Amendments seek to delete reference to "dealer" and replace it with the term "owner or seller or any person who is the agent of the owner or seller", because we believe there is no precise definition of "dealer" in the Bill. It is true there is a definition in subsection (7) of Clause 6, but I am advised it is not precise enough. There is no doubt that under normal hire-purchase and credit sale conditions the dealer will not be the legal owner of the goods. Therefore, there is a possibility that Clause 6(2) may have the effect of the imposition of a dual obligation on the consumer for any damage to the goods, because it is true that according to Common Law principles only the owner or the person having a right of possession is treated as suffering loss by the fault or negligence of some other party. What is more, under this subsection the hirer could conceivably return the goods to the wrong person or even be misled by a person calling himself the dealer who has no legitimate claim. In those circumstances the hirer would be liable. Therefore in this Amendment we emphasise the importance of the written request. Amendment 25 merely states that this request should be in writing with an indication of the date and time. I beg to move.
Amendment moved—
Page 7, line 1, leave out ("request of the dealer") and insert the said new words.—(Lord Peddie.)
LORD DRUMALBYN: The noble Lord has raised doubt about the definition of "dealer". We will certainly look at that, in view of the advice he has received, to see whether it is satisfactory or not. I should like to make this first point. The object of this clause is, where there is cancellation, to put things back exactly as they were; that is, the goods that came from the dealer go back to the dealer, the money advanced by the hirer goes back to the hirer, and so forth. The whole object
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of the clause is to put things back where they were. The noble Lord says the dealer will not necessarily be the legal owner of the goods. As to what happens to those goods, this is a matter to be unscrambled between the dealer and the owner. In some cases it might be the same person; but at any rate it is a matter to be settled there. The right thing, obviously, is for the goods to go back to the dealer. The finance house will not want to have a grand piano, for example, dumped in the middle of its premises. That is the object to be achieved, and we think this is the best way to achieve it.
The noble Lord says that there should be a written request, because otherwise the hirer could be misled. But, of course, a written request in itself would not be foolproof, and we doubt whether there is much reason for this. The probability is that the same person who delivered the goods in the first place will come along and pick them up again. Certainly that is a possibility, and in any case it will be the same firm that will be doing it. One cannot avoid fraud altogether, and I do not think the noble Lord's provision would avoid fraud or avoid misleading the consumer in every possible case. We think the written notice in all cases is quite unnecessary. I do not know whether I have dealt with all the points the noble Lord has raised. We do not consider this is a matter of very great importance, but we do think it should be quite clear that the person to whom the goods are returned is the dealer, and not the owner or seller or a person nominated by the owner or seller. The goods should be returned to the dealer, so as to put the transaction back as it was in the first place.
LORD SHEPHERD: My Lords, the noble Lords says that what we want to do is to put things back as they were before the hirer received the goods. But we may not at this early stage of the cancellation be able to effect that, because there may have been a deposit paid or even goods taken in part exchange. Later on in the Bill it says that the hirer, if he has not received the return of goods given in part exchange, or the deposit, should retain the goods under the agreement as a lien on the deposit or on his goods. I am rather worried about the case which I

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quoted in Committee stage of the possible dealer or owner coming at short notice, walking into the house and taking delivery of the goods. I am glad to see the noble and learned Lord the Lord Chancellor is present. My understanding is that if the dealer were able to obtain entry into the house he could then seize and recover the goods, and although the hirer would be able to protest he would not be able to refuse the dealer the right to take the goods, because he had obtained entry. If that is the case, it would seem to me that we want to put the hirer into the position that he receives at least a written notice to the effect that the goods are going to be recovered because of cancellation. That would give him an opportunity, if he has a deposit outstanding or has not had the part-exchange goods returned, to decide whether he should hand over the goods to the dealer.
THE LORD CHANCELLOR: My Lords, I should like to add a word or two to what has been said about this Amendment. I must say I am attracted by the idea that one should retain the word "dealer", and I will give my reasons quite shortly. I know the word "dealer" is not defined, but the hirer will know perfectly well, I imagine, in the vast majority of cases, the person with whom he or she has been dealing. In relation to hire-purchase transactions a change of ownership may happen when possibly the hirer knows nothing about it at all, and if you take out the word "dealer" and put in the words proposed "owner or seller", then it seems to me you may be creating difficulty for the hirer because she may not know who under the hire-purchase transaction is the real seller or owner at any particular moment. Nor, indeed, is it the case that the dealer is necessarily an agent of the owner or seller. Therefore I should have thought that from a practical point of view there was considerable advantage in leaving the word "dealer" where it stands.
With regard to the point the noble Lord made about a case I have not heard raised before—of the dealer coming into the house, demanding the goods and taking them away with him—I should not have thought that that was a likely event. But if we insert the provision that a written request is
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required in all cases, then it means the dealer going round and calling at the house, possibly to inquire as to the attitude of the hirer, and finding from having a conversation with the hirer that the contract is not going to be carried on, and he will be prohibited then and there from saying, "Please can I collect the goods?" and taking them, because the hirer could say, "No, you cannot do that. You have come perhaps three or four miles, but you have not given me a written request to deliver up these goods to you. Therefore you had better go down the road and write it out on the back of an envelope, and you can come back and give it to me."
I am sure that my noble friend will again consider this point in regard to the written request; but so far as the word "dealer", as opposed to the words "owner or seller", is concerned, I should have thought there was real advantage in keeping the word "dealer" although I agree that perhaps it does not have the same precision as the words "owner or seller".
LORD SHEPHERD: My Lords, could the noble and learned Lord help me on this matter of law? Do you lose the lien on the goods if they leave your possession? If the goods get into the hands of the dealer, have you lost the lien? This is most important, because we are making provision here that the hirer shall have a lien on the goods until the deposit has been repaid or the goods which were put up in part exchange are returned.
THE LORD CHANCELLOR: I think it is right to say that you must have the goods in your possession in order to be able to exercise a lien upon them. This particular Amendment is not really dealing with that point, but with the form of the request made for the return, and by whom that request should be made.
7.33 p.m.
LORD CHORLEY: My Lords, may I just say a word on one or two points? If the Minister had practised in the county courts, as I did for many years, I do not think he would have attached the little importance that he has done to having written evidence of these matters. It is astonishing how easy it is to have a complete conflict of opinion as to what

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happened orally, especially when the dispute concerns a contract between a housewife and a hire-purchase salesman. They may give diametrically opposed accounts of what has happened. If the thing is in writing, then it is not a question of having to judge who is telling the truth—not because people necessarily wish to commit perjury, but because their memories are so inaccurate. I should have thought that anybody who had had much practical experience of administering the law would have been all in favour of trying to get something in the nature of a written account rather than to rely on oral testimony. It seems to me that the noble Lord's answer smacks of the bureaucrat sitting in his office, without any knowledge of what actually goes on in courts.
I think the noble Lord, Lord Shepherd, with Lord Peddie, made another good point when they said that it is easy in this sort of circumstance for the goods to be delivered to somebody who has no claim to them. The hire-pressure salesman is not necessarily the dealer, but he may well turn up and persuade the housewife, or a young daughter or son, or somebody who is there, to hand over possession of a dishwasher or sewing machine, or whatever it is. The noble and learned Lord on the Woolsack knows perfectly well that if you hand over personal property to somebody who has no right to it, that is the tort of conversion and you can be made to pay damages for it. It seems to me that this is a real danger here. The time of the courts is continually occupied with dealing with such problems in which people have, quite honestly and genuinely, handed over goods to somebody who was not entitled to them. This is an attempt to protect the hirer, and I am sorry indeed that the Government seem to be so "sticky" about acceding to it, because on both counts, the count of the written request and that of protecting against mistaken delivery, there is a strong point to be made.
LORD AIREDALE: My Lords, I agree with every single word that the noble Lord, Lord Chorley, has said. Surely the necessity for the dealer's request to be in writing is a most wise precaution, because otherwise the way is open for any fraudulent person, upon hearing
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that goods are due to be returned to a dealer, to ring up the hirer and say, "I am sending for the goods at eleven o'clock to-morrow morning". Thereby he may gain entry and get away with the goods. However, if the request from the dealer must be in writing, the fraudulent person has at least got to get hold of the dealer's headed notepaper, and that would probably be a sufficient obstacle to him.
The noble and learned Lord the Lord Chancellor took the point that it might sometimes be inconvenient because the hirer might stand upon his rights and refuse to hand over the goods to a dealer whom he knew and trusted, simply upon the ground that the dealer had not by then furnished the request in writing. I can only say that I do not think that that would happen in practice. If the hirer knew and trusted and recognised the dealer, he would be most unlikely to take the point, "You have not given me notice in writing. You must go down the road and write it out and come back again." I just do not believe that would happen.
VISCOUNT STONEHAVEN: My Lords, I find it difficult to see why a dealer should not do what many people do—namely, walk about with a duplicate book in his pocket. I always find, when giving instructions, that writing them in a duplicate book is a good method, and I should have thought that that would be quite a practical solution to a dealer who wanted to take away somebody's washing machine. At least he would give what amounts to a receipt for it.
LORD DRUMALBYN: My Lords, if I may sneak again on this point, I have been impressed by the arguments that have been put forward. I think that perhaps I was rather misled by the fact that these three Amendments were being taken together. I do not think there is a great deal of merit in the Amendment of the noble Lord, Lord Chorley, No. 25, but I think that a firm sending out a porter or a lorry-driver to collect goods would probably give him written instructions anyhow, and he could hand over those written instructions as credentials. I do not see that there is any particular reason why this should not be accepted in principle, from the point of view of

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the written request. But on the question whether it should be "owner or seller" or "the agent of the owner or seller", I can only, with respect, agree with the noble and learned Lord the Lord Chancellor, that we should stick to the word "dealer" as it is, and we will make provision for written requests in the Bill. I do not know whether it would be possible to do this in two days' time, but at all events we will carry this into effect.
LORD PEDDIE: My Lords, I appreciate the noble Lord's acceptance of our suggestion of a written request. I did not entirely agree with his argument with regard to "dealer", but, having heard the case he has advanced, and with his assurances, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
7.40 p.m.
LORD DRUMALBYN: My Lords, I now move that the further consideration of the Bill on Report be adjourned during pleasure until 8.40 o'clock.
Moved, That the House do now adjourn during pleasure.—(Lord Drumalbyn.)
On Question, Motion agreed to, and House adjourned during pleasure accordingly.
8.40 p.m.
House resumed.
LORD CHORLEY LORD CHORLEY moved, after subsection (1), to insert:
"(2) At the time when the goods are delivered in accordance with paragraph (a), (b), or (c) of the preceding subsection the owner or seller shall deliver, or cause to be delivered, to the prospective hirer or buyer a document acknowledging the receipt of the goods together with a statement of defects, if any, apparent upon visual examination of the goods."
The noble Lord said: My Lords, the point of this Amendment is to enable the hirer to get a statement with regard to any defects there may be. Obviously, this may often happen, and it seems that in a Bill which is designed to protect the interests of the hirer there should be some provision of this kind giving him protection of this sort. The question whether there is something the matter with the goods is often a difficult problem for a judge in a county court—or nowadays a judge in the High Court—to deal
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with. It is a common provision in commercial transactions, as the noble and learned Lord on the Woolsack will know, for example in connection with sea shipments where a bill of lading has to be delivered, for such statement to show whether or not the goods being loaded on to the ship are in good order and condition. This is of the greatest advantage to courts when faced with this problem, and it appears reasonable that there should be a similar sort of provision in order to protect the interests of hirer or purchaser under a credit sale agreement.
Amendment moved—
Page 7, line 4, at end insert the new subsection.—(Lord Chorley.)
LORD PEDDIE: My Lords, common sense dictates that the owner or seller should give a receipt for goods, together with a statement of defects. I seem to remember the noble Lord opposite agreeing in Committee that the proposal itself was most sensible. He went on to say that it was entirely in accordance with good business practice, but presumably felt it undesirable to write such good business practice into the Bill. He also went on to suggest that, up to a point, people should be relied upon to protect themselves. If we accepted the logical outcome of that, there would be little need for a Hire-Purchase Bill.
I remember, too, that an objection was made that it would be ineffectual to put this requirement into the Bill unless in some way we made it a criminal offence not to give a receipt. But I suggest that there should be no legal difficulty in that respect. In fact, all this Amendment does is to establish a code of conduct, and, so far as I am aware, it is quite possible to establish such a code without necessarily introducing the idea of some penal offence. Here there are circumstances where a receipt and an indication of damage are important, because of the nature of the transaction. One can understand goods being returned under conditions where there is not likely to be a great degree of good will between the owner, on the one hand, and the hirer, on the other. In those circumstances it seems particularly obvious that a receipt should be given.
LORD DRUMALBYN: My Lords, I have listened with great interest to the two noble Lords who have moved this

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Amendment, and I note that what they really want here is a code of conduct rather than a statutory provision. But I doubt very much whether it is right to use the Statute Book for this kind of exhortation, as it were—because it would not amount to anything more than that—unless we make it a criminal offence, or attach some other sanction to the failure to give a receipt. I think a receipt is perfectly good business practice, but there are positive dangers in what is provided in this particular Amendment, because not only has a receipt to be given, but also a statement of the defects. Again, one may say that this is quite a reasonable provision, but a hirer pretending he had returned goods would say that the dealer refused to give him a receipt to start with; and, as I said before, a dealer pretending goods had not been returned would say that the hirer had been given a receipt and was concealing it.
But the real difficulty in this Amendment is in the statement of defects. There is a real possibility of a disagreement between the hirer and the person to whom the goods have been returned. They might disagree as to whether or not the defects were caused by the hirer, or as to whether or not they were the result of failure to take reasonable care; and they might also disagree on how much the actual damage amounted to. These, surely, are matters which must be decided by the courts and by the normal legal processes, if they arise. I should not have thought that simply to put down in an Act of Parliament that the normal business practice should be followed, without making it mandatory in any way to follow that business practice, was a particularly desirable procedure. I entirely agree that this is good practice, but there are plenty of things that are good in the world which are not made mandatory by law.
LORD PEDDIE: My Lords, I am encouraged by the fact that the Minister has indicated that this is good practice, and I should think it was good practice on our part to seek, as far as possible, to incorporate in the Bill all things that are good practice. I am not quite clear whether or not the noble Lord opposite is accepting this Amendment in principle. Apparently he is not keen on accepting the provision regarding the
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statement of defects, because of the possibility of disagreement. Surely, if there is a possibility of disagreement—and I endorse that there is that possibility—it is in consequence of the condition of the goods. If the noble Lord opposite is using as an argument against this Amendment the fact that there will be considerable disagreement on the question of the estimate of damage, surely that, in itself, is a justification for acceptance of the Amendment.
THE LORD CHANCELLOR: My Lords, I should just like to say a word upon this Amendment, although I cannot claim much longer acquaintance with it than the noble Lord, Lord Chorley. I would ask the noble Lord, Lord Peddie, to consider again the position with regard to the requirement that there should be a statement of defects, because I must say that I can see that requirement operating to the disadvantage of the hirer. As I understand it, there is no criminal sanction or any other sanction to require the dealer to give this statement of defect, and if the hirer thinks it is in, it may well operate as something in the nature of a trap to him.
Take the case where the hirer has damaged goods—I am not concerned, and the Amendment is not concerned, with what has been the cause of the damage, but damage which is apparent upon a visual examination of the goods—and where the hirer says to the dealer who has come to collect the goods, "Please give me a statement admitting that there are these defects". No doubt a very honest businessman would do so; but there are other cases. What happens if the man refuses? He cannot be compelled to give a statement; and then, when the matter goes to court, he is able to say, "I saw the goods; I was asked for a statement; there were no defects and I therefore did not give it. The defects must have arisen thereafter; the goods were perfectly all right". The fact that a hirer had not obtained a statement of defects, although he might have asked for it, might well operate to his prejudice in subsequent court proceedings. I would therefore suggest to the noble Lord, in all seriousness, that if there is going to be a dispute on the question of whether or not the

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goods were returned in a damaged state (and, as the noble Lord, Lord Chorley, has said, disputes on questions of fact do arise in a county court, and the judge has to make up his mind who is telling the truth), then the absence or presence of a statement of defect is a complicating factor and might, in a number of cases, operate to the disadvantage of the hirer.
May I give another instance? Suppose the hirer says that the goods have defects, but not knowing the Bill as well as the noble Lord, Lord Peddie, does omits to ask for a statement of defects. Eventually, she might be asked in court by counsel for the dealer, "You say these goods were damaged. Did you ask for a statement of defects?" If her answer is "No", it might well prejudice her. Therefore I would suggest to the noble Lord, in all seriousness, that, although I fully appreciate that his object is to try to avoid unnecessary disputes in the courts—an object with which I sympathise—it would be much better not to press this Amendment, so far as it relates to statements of defects, because I can see that in many cases it might operate to the disadvantage of the hirer.
LORD PEDDIE: I am glad the noble and learned Lord who sits on the Woolsack is in sympathy with the object that lies behind this Amendment, but in arguing the case against myself I think he poses a situation that is hardly likely to arise. He indicates a situation where the hirer is asking the owner who is collecting the goods to make a statement of defects. That is not likely to arise. It is more than likely that you could have, in normal circumstances, an owner collecting goods, taking them away and then, later on, declaring that there are defects in the goods that he has collected. I suggest that this Amendment would indicate that, if there are any defects which are observed by the owner when he collects the goods, it should then be his responsibility to indicate, at that point, what those defects are, rather than to leave it until a later date, when there will be disputation, when there will be court proceedings, probably over the declaration by the owner that there were defects in the commodities which were not declared at the time the goods were collected. Far
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be it from me to cross swords on matters of law with the noble and learned Lord who sits on the Woolsack, but I would argue in terms of logic and in terms of common-sense. There would be considerable advantage in a person giving a receipt and, at the same time, an indication of defects, if defects there should be. However, I gather from the observations that have been made that the point which lies behind the Amendment has been taken, and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
LORD GREENWAY: My Lords, may I ask why the Opposition have all these Amendments down? They are not moving them—
LORD AIREDALE: My Lords, may I interrupt the noble Lord to suggest that the noble Lord, Lord Chorley, be empowered to move his Amendment?
LORD CHORLEY: My Lords, I am trying to move the Amendment that stands in my name. I do not think the noble Lord, Lord Greenway, observed that I was on my feet. This is an Amendment to Clause 9(5) which is concerned with the position of the parties at Common Law, not under the obligations imposed by this Bill. The Amendment is to add to subsection (5):
"It shall, however, be lawful for the Owner or the Seller to require the hirer or buyer to deliver or post any notice rescinding the agreement (not being a notice of cancellation) to the Owner or Seller at a specified address provided that—

(a) the Statutory copy of the agreement shall have already been sent to the hirer or buyer;

(b) both this requirement by the Owner or Seller and the address to which the notice rescinding the agreement must be delivered or posted shall be clearly stated on both the hire-purchase or credit-sale agreement and the statutory copy thereof;

(c) the Owner or Seller shall not have previously authorised any other person who conducted antecedent negotiations to collect and receive instalments on behalf of the Owner or Seller."

There may be in connection with the transaction accusations of misrepresentation and matters of that kind in connection with the goods which are the subject matter of the hire-purchase contract; and it is very important that the finance company, the owner of the goods, who is in law selling them, should know of these. As the Bill stands they

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merely have to be brought to the notice of the dealer, who no doubt is the person actually responsible for them. But there are two important considerations which unfortunately I was not able to bring to the notice of the Minister at the time this matter was before the House in Committee because I did not arrive here in time.
But in the first place it may well be, and I think it very likely, that a dealer who is being backed financially by a finance company will be very loth to bring the fact that accusations of misrepresentation and, quite possibly, fraud are being made against him to the notice of the finance company, which nevertheless in law will be responsible for him. Obviously it might very seriously upset the relationship between the two; and, not only from the point of view of the finance company but from the point of view of the hirer, it may be very important at an early stage that the person legally responsible, the finance company, and the hirer should be brought into contact with each other so they may reach some solution for the dispute and will know where they stand if the matter has to be brought before a court of law. Therefore it seems proper that the owner, the finance company, should have the right provided by this proposal to have the matter brought to its attention.
However, there is also the possibility, which I understand arises not infrequently in this sort of transaction, that the finance company and the dealer may part company after a short time. The finance company may find that the dealer is not behaving in the sort of way which appeals to them, or it may be that the dealer does not like the finance company and prefers to deal with some other company.
The type of complaint which is envisaged in this Amendment may occur months, or even years, after the actual transaction is entered into. I am told that a very common type of complaint is of the dish-washing machines, many of which are sold by hire-purchase, where the electric machine is thoroughly inferior but may work quite well for the first months. By the time the fraud which is involved in the installation of an unsatisfactory electrical machine of
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this kind has become evident to the hirer, the finance company and the dealer may have parted company. In these circumstances, it is essential that the complaint should be made to the finance company, not to the dealer, who at this point may not be competent to handle the complaint. Therefore it is important that the facilities provided for the hirer in this clause may be at his disposal. I hope that I have been able to bring to the Minister's attention arguments of which he has not been previously aware, and that he will agree that this is an important matter and a useful provision in the interests of the hirer. I beg to move.
Amendment moved—
Page 9, line 44, at end insert the said subsection.—(Lord Chorley.)
LORD DRUMALBYN: My Lords, this appears to me to be a provision which would allow the owner or seller to prevent the hirer or buyer from serving the notice of cancellation under Section 3 of the Act, as provided in Clause 9(5), on the dealer, and to insist that the notice rescinding the agreement should be supplied to the owner or seller. It is difficult to see the circumstances in which this might apply. I should have thought that if notice of rescission was going to be submitted to the dealer, it would be submitted before the owner or seller got to know that notice of rescission was going to be submitted. I do not see how the owner could anticipate this. The noble Lord talks about the right of rescission arising late in the contract. I am not learned in the law, but I have been given to understand that it would be only early in the life of the agreement that the right of rescission could be exercised at all. Therefore it seems to me unlikely that this particular difficulty will occur. I will certainly study what the noble Lord has said, but from what I have understood of his argument I am not inclined to advise the House to accept the Amendment.
LORD CHORLEY: My Lords, I beg leave to withdraw my Amendment.
Amendment, by leave, withdrawn.
9.5 p.m.
LORD PEDDIE LORD PEDDIE moved, after Clause 11, to insert the following new Clause:
Notice of arrears or default
".—(1) Where goods have been let under a hire-purchase agreement to which the principal Act applies and the hirer has made

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default in the payment of any sum due there-under the owner shall not enforce any right to recover possession of the goods from the hirer unless he has served a notice (in this Act referred to as a 'notice of arrears') on the hirer by registered post at his last known address requiring payment of the sum so due and default has been made in payment of such sum or part thereof for at least 7 days after such service.
(2) Every notice of arrears shall contain or be accompanied by a document in the terms prescribed in Schedule (Notice to be included in or to accompany a notice of arrears) to this Act."
The noble Lord said: My Lords, this Amendment deals with notice of arrears or default. Its purpose is quite simple: it is merely to ensure that a notice of arrears is sent to the hirer. I know it can be said—and I will accept it as an argument in favour of my case—that it is common practice that notices of arrears are, in fact, sent by reputable companies. Therefore, because it can be established and accepted that reputable companies do this, we feel that it would be an advantage that it should be incorporated in the Bill and that there should be no enforcement of possession unless that notice is given. On the Committee stage, many illustrations were given, which I need not repeat to-night, of cases where it is in the interests of the hirer (or, probably, of his next of kin) that a notice be given, because a situation may have arisen due to circumstances outside the control of the hirer, and particularly the dependant. Therefore, before the owner can move in and establish repossession of the goods we urge that a notice of arrears should be required to be sent.
We go on to make mention, in subsection (2) of the Amendment, that the owner's notice must be accompanied by a form, in the style shown in our new Schedule I(1)(a), by which, if the customer dies, a personal representative is given the right to purchase the goods or take over the agreement. This, as your Lordships will appreciate, deals with a situation where a failure to pay instalments by reason of death allows the owner to repossess, and it applies where less than one-third of the hire-purchase price has been paid. I would remind noble Lords that, under the Bill as it stands, in the event of death it is possible, if less than one-third of the price has been paid, for the goods to be repossessed by the owner. This, I
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may say, is not covered completely by the provision in Clause 12, which prevents the owner from ending the agreement because of death. We welcome that clause, but we feel that this Amendment gives added protection to dependants and is one which will strengthen the Bill. I beg to move.
Amendment moved—
After Clause 13, insert the said new clause.—(Lord Peddie.)
LORD SHEPHERD: My Lords, I should like to support my noble friend, and I will do so as briefly as I can. I would ask the House to consider the position of what we call the prospective hirer. In the vast majority of cases he sets out with the object of buying the article, and he adopts a hire-purchase basis because this is the only way in which he can obtain the long-term credit. Hire-purchase has been adopted by companies so that they at least retain the title to the goods until the last instalment is paid.
As I said on Committee stage, in the event of the husband, say, meeting with an accident, or becoming sick and perhaps being in hospital under drugs, he may be the only person in the family who will have knowledge that the article is under hire-purchase; or the wife may know that the article is under hire-purchase, but may not be aware of the company to whom the sum is due. She may well be without, not only the knowledge of the company to whom the sum is due, but the date on which it is due. If this Amendment is accepted it will not involve in any way the more reputable firms who, as I said on Committee stage, issue a notice of default perhaps three or four times. This Amendment is aimed at those companies who may indulge in what we call a "snatch back"; those companies who, because of default for a matter of hours, may be able to recover the goods. As I said, the wife may have no knowledge of the sum that is due. If this Amendment is accepted, she would receive by registered post—and then, of course, there would be no argument as to whether a notice had been given or not—notice to the effect that a sum was due, and she would then be able to make the payment.
I should have thought that this would be a great advance in hire-purchase

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security to the hirer. I do not think it would involve the reputable companies, who comprise the vast majority in this business, in any difficulty, because they give this notice. They give it as a matter of right. This is aimed at one or two companies who have indulged in "snatch back". If this Amendment is accepted, it would deal with that problem, and I think it would be a considerable advance in hire-purchase legislation.
LORD CHORLEY: My Lords, I should like to say a word in support of this Amendment. One of the worst grievances of the large section of the community who obtain their goods on hire-purchase is the quite ruthless application of the "snatch back", as it is colloquially called, over a wide range of these transactions. I am told by friends and colleagues who work in poor men's lawyers institutions and places of that kind that they are continually confronted with this type of case. It is quite true, as the noble Lord, Lord Shepherd, said, that the best hire-purchase finance companies give notice and give some latitude, but that is certainly not typical of them all. It was one of the results of Miss Wilkinson's Bill that the "snatch back" was to some extent curbed, but far from completely. I have myself a little later on an Amendment to restrain the snatch back as is done in Scotland, but I will not deal with that now.
This is a comparatively mild Amendment—indeed, very mild—and I should have thought that the Government could hardly resist it. What is there to be said against giving a small locus pœnitentiœ, to use a common legal phrase, of a short period of time in which the matter can be put right? We are dealing here in hundreds of pounds. After £600 is paid off a £2,000 motor car, there can be a snatch back without any notice or anything else if this Amendment is not accepted. It is a completely ruthless exercise of dominance in the commercial world. I think strong words are necessary on an occasion like this, and I hope the Minister will see his way to accept this Amendment.
LORD DRUMALBYN: My Lords, in this case I do not think we need argue about ends at all. I think we are in
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agreement on the objective, and I am prepared straight away to accept that there should be some statutory notice given for repossession. I must express my regret to the House that it has not been possible to work out an Amendment before this stage, but this is a complicated matter and we have had many other matters to deal with. I am quite certain that the effect of this Amendment would not be in accordance with the wishes of noble Lords who have moved it. For one thing, it would not prevent the owner from terminating the agreement before he gave the notice. The agreement might be terminated. I think that what noble Lords opposite want is the continuance of the agreement, and the present drafting of the Amendment would be a very grave defect to this end. For that reason we could not accept the Amendment because it would not do what we both want done.
Nor would subsection (2) give as good protection as there is already in the Bill, because the obligation is only to send along with notice of the arrears a document in terms prescribed in the Schedule, and all that that does is either to make an offer or to undertake to acquire the liabilities of the hirer under the hire-purchase agreement. If the agreement had already been terminated, of course the second item in that would be of no effect whatsoever. I hope, therefore, the mover of the Amendment will agree to withdraw it on an undertaking that we will try to put something which will give effect to what he has in mind into the Bill in another place.
LORD PEDDIE: My Lords, I thank the noble Lord for those remarks and I am indeed willing to withdraw the Amendment in the light of the assurances he has given that this matter will be dealt with and that there is an acceptance of the objectives that we seek. I agree that there are drafting difficulties, and with the assurance on the part of the noble Lord opposite that he will deal with them I have pleasure in withdrawing the Amendment.
Amendment, by leave, withdrawn.
Clause 17 [Conditional sale agreements]:
LORD DRUMALBYN: My Lords, this is a consequential Amendment which will enable provisions for conditional sales agreements which are brought within the ambit of the Act and made exactly equivalent to hire-purchase agreements to be put in the same conditions so far as the application of them to bodies corporate is concerned; that is to say, bodies corporate are excluded from the working of the Act in so far as conditional sales agreements are concerned. I beg to move.
Amendment moved—
Page 18, line 23, at end insert—
("Provided that any such reference shall not include a conditional sale agreement which is made by a body corporate (whether incorporated in the United Kingdom or elsewhere) as the buyer of the goods to which the agreement relates.")—(Lord Drumalbyn.)
On Question, Amendment agreed to.
LORD CHORLEY LORD CHORLEY moved, after Clause 17, to insert the following new clause:
Amendment of section 11 of the principal Act
". Subsection (1) of section 11 of the principal Act shall be amended to read as follows:
Where goods have been let under a hire-purchase agreement the owner shall not enforce any right to recover possession of the goods from the hirer otherwise than by action.'"
The noble and learned Lord said: My Lords, this is the Amendment to which I referred a moment or two ago. The object is to prevent the finance company from recovering possession without first of all going to a court and obtaining an order; in other words, to prevent a straight "snatch-back", to control the "snatch-back" by means of court proceedings. From the beginning, as I understand it, this has in fact been the law in Scotland, and it has worked perfectly well. In Scotland a finance company cannot make a snatch-back without going to a court and satisfying the court that the hirer has failed to observe the agreement punctually, and if the court, in all the circumstances, feels that this is a proper case for allowing the resumption of the possession, then it makes the order.
This perhaps has not worked a great grievance in this country up to the present time, or not as much as one might have expected, because, of course, the value of the goods has been comparatively small; but now that the figure
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is up to £2,000 the "snatch-backs" are going to become very serious indeed, As I said a moment ago, when a matter of £500 or £600 has been paid on a motor car and then there is failure to pay and there is immediate "snatch-back", it is going to be the cause of a great deal of trouble and undoubtedly bitterness and great grievances, and in a short time Bills will be produced in Parliament and a lot of time wasted. We might as well do it now.
The only argument I can see against this is that it is suggested it would lead to flooding of the courts, and if Scottish experience showed that that were so it would be a strong argument against it. I have done my best to find out what has been the experience in Scotland, and so far as I can discover there has not been any flooding of the Scottish courts in this way. There is no reason to suppose in this country it would be different. Therefore, what on the face of it appears to be a strong, practical argument would not turn out in that way at all. I hope your Lordships will agree that in the new circumstances with the £2,000 figure it is right that there should be court control over resumption of possession in this way, and I hope the Minister will accept this Amendment. I beg to move.
Amendment moved—
After Clause 17, insert the said new clause.—(Lord Chorley.)
LORD DRUMALBYN: My Lords, I am not really clear what the noble Lord expects to happen as a result of his Amendment. I rather think that he imagines the effect of his Amendment would be that, if application had to be made to the court each time, then the powers of the court under subsection (4) of Section 12 of the Act would operate; that is, for example, the power to make an order and postpone the operation of the order even where one-third of the purchase price had not been paid. That, I am advised, is not the case. I think he is mainly concerned with cases where one-third of the purchase price has not been paid and therefore where in the normal way repossession can take place without application to the court. In such a case surely the court would have no option but to give possession.
So the only effect of this Amendment would be to force the owner to wait for the period before the case came to court

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before he could repossess; in other words, allow the hirer to continue to use and possess the goods for that amount of time after he would normally be allowed to. So far as I can see, that is the only purpose the Amendment could achieve. I think this is a pretty drastic change in the law and it is one that was certainly not contemplated by the Molony Committee. I know of no great demand for it, and I think it would be rather disproportionate, especially where the hirer had paid a very small amount of the total hire-purchase price. I really think the House would be ill-advised to accept this Amendment and I ask your Lordships to reject it.
LORD CHORLEY: My Lords, the noble Lord has not dealt with what happened in Scotland at all. I think the fact that Scotland will in fact be deprived of this quite useful protection is a matter which might be of interest to Scottish Peers. Quite apart from that, it is, of course, quite true that the effect would be to give the hirer a period in which he could turn round and perhaps make arrangements to resume payment of the instalments, and in that way he could possibly not lose the advantage of all the instalments which he had been paying earlier on. Anyone who has had the advantage of working in courts will know perfectly well that in a situation of this kind a wise judge can bring a good deal of pressure to bear upon the parties, and frequently with the assistance of the judge, who will call into his room counsel who are engaged in the case, a quite reasonable compromise solution can be worked out which will in fact have the result of protecting the hirer, who, under the new arrangements, will now pay £400 or £500 and get nothing for it.
The noble Lord does not really seem to have faced up to the grievous position which this Bill is going to initiate if there is not some sort of protection. If the noble Lord will not help me, I cannot carry this any further and must ask leave to withdraw it; but the matter will be obvious in the eyes of the public because it will deprive the man in the street of a good deal of protection.
Amendment, by leave, withdrawn.
9.27 p.m.
LORD DOUGLAS OF BARLOCH LORD DOUGLAS OF BARLOCH moved, after Clause 17 to insert the following new clause:
County Court jurisdiction.
. Section 39 of the County Courts Act 1959 (which prescribes the general jurisdiction of County Courts in actions of contract and tort) shall have effect in relation to hire-purchase agreements and credit-sale agreements to which the principal Act applies and conditional sale agreements to which section 17 of this Act applies as if for the reference to £400 there were substituted a reference to £2,000 or such larger sum as may from time to time be specified in any Order in Council made under section 1(3) of this Act."
The noble Lord said: My Lords, I beg to move that Amendment No. 41 be agreed to. I moved this Amendment upon the Committee stage of the Bill, and the noble Lord, Lord Drumalbyn said that he would consider this matter. I have no indication of what the result of his consideration may be, so I think I had better state the case once more, unless I understand that he is going to accept it, in which case I will not weary the House with it.
As the Bill stands at the present moment, jurisdiction with regard to hire-purchase and credit-sale agreements is vested in the county court up to the sum of £400, which is the normal limit of jurisdiction. Jurisdiction is also vested in the county court where proceedings are taken to recover a vehicle. Other cases where the amount involved is over £400 will be dealt with in the High Court. Therefore, there will be two separate jurisdictions dealing with matters relating to hire-purchase. I think this is intrinsically undesirable, and in any event there are good reasons why the county court should be the tribunal to deal with questions of this kind. It is already the tribunal because of the limitation as to the hire-purchase and credit-sale agreements which are subject to statutory control. County court judges already have experience of dealing with these cases, and I believe that they deal with them in an extremely satisfactory way.
It is a fundamental principle with regard to this Bill, as the noble Lord, Lord Drumalbyn, said in an earlier discussion upon some other Amendment, that the whole purpose of this legislation is to protect the hirer because of his comparative weakness and his lack of knowledge. That is a good reason

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why the county courts should deal with these matters: because the procedure there, unlike that in the High Court, is relatively simple and the general public have some idea of what it is.
I am sure that those of us who are accustomed to the practice of law have all had experience of writs being issued in the High Court and served upon people who are not very well off and are inexperienced in business transactions. They do not realise what has happened. They think that they will receive a summons to attend the court, and that nothing will be done until they receive an intimation as to the date of the hearing—which of course is the normal practice in the county courts. The practice in the High Court, of course, is entirely different, and although it is true that a writ of summons in the High Court has upon it information that if one wants to defend proceedings one can write to obtain a form, fill it up and send it in, many people who receive documents of that kind fail to understand them and thus do not get the protection to which they are entitled. I know there is a procedure whereby, when judgment has been signed in default, it is possible in certain cases to have a judgment set aside and the matter reopened. But the normal practice in such cases is that the applicant has to pay the costs of the application. The whole thing is far too complicated, far too strange and difficult for the great majority of people who enter into—and who will in the future enter into—hirepurchase transactions which are within the scope of the statutory protection.
The noble Lord in charge of the Bill, when I moved this Amendment on the last occasion, gave a perfectly clear statement of what the law is at the present moment, with which I do not disagree at all; but he put forward no argument against this Amendment, and he promised that he would give it consideration. Therefore, I hope that it will be accepted. My Lords, I beg to move.
Amendment moved—
After Clause 17, insert the said new clause.—(Lord Douglas of Barloch.)
LORD DRUMALBYN: My Lords, the noble Lord, Lord Douglas or Barloch, said that if I could accept the Amendment
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he would not continue with his speech. I would willingly have done so had we been able to complete our consideration. As I said before, we have considerable sympathy with this point, and I am confident that we shall be able to go some way, at any rate, to meet the purpose of his Amendment. But I am afraid that I am bound to say that we have not yet completed consideration of this matter and shall not be able to do so before this Bill passes through this House. I am very much obliged to him for the way in which he moved his Amendment to-day, and I hope that with the assurances I have given he will agree to withdraw his Amendment.
LORD AIREDALE: My Lords, I was interested in this matter, as I think was the noble Lord, Lord Peddie, and we both raised it during the Second Reading debate. I have to confess that I stopped following this trail on the strength of what the Minister said in his reply to that debate —[OFFICIAL REPORT, Vol. 253 (No. 15) col. 1193.] He said that if the noble Lord, Lord Peddie
"looks at Sections 11 and 12 of the principal Act he will find that these cases are cases which are to be taken in county courts; and that, I am informed, covers the cases that will emerge, despite the increase in the limit, just as much as the cases below the normal limit for county courts."
I have heard matters expressed more clearly, but I took that, and still read it, as indicating that the Minister was at any rate on that occasion entirely in sympathy with the principle of this Amendment. I certainly hope that this is so.
THE LORD CHANCELLOR: My Lords, perhaps I had better say a word on this because I am primarily responsible for county courts. I have listened to what my noble friend has said in answer to the noble Lord, Lord Douglas of Barloch. I myself would say that I certainly think more consideration ought to be given to this question before any firm commitment about enlarging county court jurisdiction to this extent is entered upon. The whole question of raising the limits of county court jurisdiction is a matter which has to be under consideration, and this

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would be only one part of that particular problem. In relation to that problem, as indeed to this, one has to consider and bear in mind the heavy burden of work which now falls upon the county courts. One really does not want to overload the county courts with work. But I am grateful to the noble Lord, Lord Douglas of Barloch, for the tribute he paid to the way in which the work is done in the county courts, although I cannot join with him in his reflections upon High Court procedure.
LORD DOUGLAS OF BARLOCH: My Lords, I am obliged to the noble and learned Lord the Lord Chancellor for some of what he has said. However, he is perhaps not so well acquainted with some sides of High Court procedure as I am, as he happens to be a barrister and not a solicitor. Therefore I am not going to withdraw what I said about it. I have the highest respect for procedure in the High Court of Justice, but I do not consider that it is appropriate to this particular kind of business. I want to submit, with all respect, that this is not a matter which should be deferred to some future consideration of what are generally the limits of jurisdiction in the county court. That would probably defeat the whole object and purpose of this Amendment, which is to help a class of litigant who is inexperienced and deserves to be protected by having both a tribunal which is accustomed to dealing with matters of this kind, and a tribunal in which, by and large, the costs are smaller and the expenses of litigation are less. These are all matters which deserve very serious consideration indeed.
I want to make just one further point. It is perfectly true that, if this Amendment were accepted, it would raise the jurisdiction of the county court in this particular class of case above its normal limit. But there is not necessarily anything anomalous or unusual in giving to the county court an exclusive jurisdiction in some particular kind of matter. Upon the Committee stage I referred by way of example to something which now, of course, is obsolete, and that is that under the Workmen's Compensation Acts the county court was the tribunal and it mattered not what was the amount involved; it was the sole and only tribunal.
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I submit that that ought to be so in the present case.
I want to point out that I am not averse to the Minister's having more time to consider this, but this matter was raised long before it was raised by means of an Amendment here. Representation was made by the Law Society for this Amendment to be made to the Bill, and a recent memorandum was presented in support of that. I feel strengthened in my conviction that this is a proper Amendment, in that it has been supported by the Law Society whose members have a great deal of experience in the practical operation of these matters. But I will, in view of what has been said—
LORD SHEPHERD: My Lords, before the noble Lord withdraws his Amendment, I wonder whether the Government could give any indication of whether they can give us a reply on Thursday, because this is quite a change from the understanding of this House in regard to court procedure. The noble Lord the Minister—I think he was quoted by my noble friend Lord Airedale—made it quite clear that the county courts will have jurisdiction, and it was for that reason that we did not press the previous Amendment. I think the noble and learned Lord the Lord Chancellor would agree that there is not only the question of the hire-purchase companies themselves requiring to go to court, whether it be the county court or the High Court, but it may well be that it is a hirer who has to go to court for redress. In view of the uplifting of the amounts which are covered by the Bill, we may well find that a hirer, in order to take action, has to go to the High Court. If that is the case, taking into account the charges involved and the time, I think it would be very undesirable; and, before this Bill leaves us and goes to another place, I hope the Government will be in a position to make a statement on this very important matter.
LORD DRUMALBYN: My Lords, if I may speak again, may I say that what I was trying to talk about—and I agree that, on the point made by the noble Lord, Lord Airedale, I was not as clear as I should have been on the Second Reading of the Bill—was whether, because of the extension from £400 to £2,000 in cases of repossession under Section 12 (that is,

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those where one-third of the price has been paid, and this is what I was thinking about), those cases would come under the county court or not. The information I gave to the House, based on the advice I was given, was that they would automatically come under it, because as Section 12 of the Act is drafted these are matters for the county court. What the noble Lord, Lord Douglas of Barloch, was talking about first of all were cases where one-third had not been paid, and which are not subject to Section 12 of the Act. So that is one type of case. Then there are the cases of contract, tort, damages and the like, separate from them, which also arise. I am sorry I cannot go further than I have gone today, but the matter has not yet been fully cleared, and I should be grateful to your Lordships if you would leave it open for the time being. I will do my best to be able to say something about this on Third Reacting, but I should not like to make a promise.
LORD DOUGLAS OF BARLOCH: My Lords, I do not want to detain the House. I ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
9.42 p.m.
LORD MCNAIR LORD MCNAIR moved, after Clause 19, to insert the following new clause:
Size of type of prescribed document
". All agreements, statements, notices and other documents required or prescribed by this Act or the principal Act shall either be typewritten clearly and legibly or be printed in type of a size not less than the type known as ten point Times."
The noble and learned Lord said: My Lords, I am moving this Amendment subject to the deletion of the last word, "Times". I have already spoken twice on the subject dealt with in this Amendment, and I do not propose, at this hour of the night, to repeat my arguments. But, for the sake of the record, and in order to convince your Lordships that this is not a capricious Amendment but is designed to remove a substantial defect, I wish to convey to the House an expression of judicial opinion upon the practice of printing so many hire-purchase agreements in a type that makes it practically impossible for the hirer to react them.
I refer to the case entitled Lowe v. Lombank, Limited, which was decided
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in the year 1961 by a strong Court of Appeal consisting of two present Members of your Lordships' House—the noble and learned Lords, Lord Goddard and Lord Upjohn—and Mr. Justice Diplock, now Lord Justice Diplock. It was the case of the purchase of a motor car by means of hire-purchase by a widow, aged 65. Lord Justice Diplock, in delivering the judgment of the Court, which was concurred in by his two colleagues, referred twice to the character of the print in the hire-purchase agreement. He said that:
"under modern conditions many transactions, particularly of hire-purchase, are entered into by ignorant persons whose only choice is either not to enter into the transaction at all or to enter into it on the terms of a standard agreement, drafted by the hire-purchase company, and containing numerous clauses printed in miniscule characters which the hirers do not in fact read, and if they did, would be incapable of understanding."
The Court of Appeal, in giving judgment in favour of the widow for damages for breach of statutory conditions stated in the Act of 1938, rejected the contentions of the motor dealer in these words. This was again said by Lord Justice Diplock:
"We reach this conclusion without reluctance, for Clause 9(ii)"—
of the agreement—
"is clearly an attempt, which only the size of the print in which it is set out prevents one calling it blatant, to evade the provisions of Section 8(2) and 8(3) of the Hire Purchase Act, 1938."
I think there is a good deal of sympathy in many quarters in this House for the view that something ought to be done to ensure that the hire purchaser should at any rate have a decent chance of being able to read an agreement before he enters into it. I beg to move.
Amendment moved—
After Clause 19 insert the said new clause.—(Lord McNair.)
9.44 p.m.
LORD DRUMALBYN: My Lords, no one for one instant would ever accuse the noble Lord of moving a capricious Amendment; and I would immediately say that I think there is a very great deal of force in the purpose of this Amendment. At the same time I would just say that I am advised by the experts that the size of the print alone is not enough. Noble Lords themselves will quickly

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realise that if Hansard were printed right across the width of this Box in the same print as it now is, it would be completely illegible. The length of the line is important; the colour of the paper and the type used is important. The clarity of the type face is important; and I am actually told that there are some 9-point types bigger than 10-point Times. All these things are important. Having said all that, though I do not think the actual wording of this Amendment should be accepted, I would willingly accept the principle of the Amendment; although I am inclined to think that it would be better to do this by regulation rather than by inserting an actual provision in the Bill. But certainly we will do something about this and put it into the Bill at the next stage.
LORD MCNAIR: My Lords, I am very grateful to the Minister. I should like to know whether I am right in thinking that on Thursday of this week we shall be able to put an Amendment in the Bill before we vote upon it at Third Reading.
LORD DRUMALBYN: My Lords, I should not like to give an undertaking on that. In any case, it would mean it would have to be a starred Amendment that would appear on the Order Paper only that day. But if the noble Lord will agree to accept such an Amendment—if it is possible to put it down—I will certainly see whether it can be done.
LORD AIREDALE: My Lords, was not this Amendment put down at the Committee stage of the Bill? Surely the Government have had time already to put down their Amendment to cover it. I think the Minister said that something would be done by the time the Bill reached another place. Surely, when noble Lords have raised matters about which they are concerned, it is due to them that these matters should be dealt with before the Bill leaves this House.
LORD DRUMALBYN: My Lords, if I may speak again, we would willingly have done this, had it been possible, and had the number of Amendments of this type put down been smaller. The more Amendments put down, the more difficult it is to get the drafting done before Report stage; and, as the noble Lord is well aware, taking the Bill a little
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earlier on Report stage than we otherwise expected to do has made it more difficult for us.
LORD CROOK: My Lords, I have some sympathy with the Government on this matter, strange as it may seem. The relation of type size to the width between lines and width of column, the quality of paper used, and so on, are difficult subjects, as those of us who have edited papers over many years, as I have done, know. I am sure that the Minister is right. We cannot put this in an Act. As the noble Lord has indicated, it is proposed to provide regulations to deal with type faces. I do not think it matters whether it is 10-point or 9-point on 10 body or 8-point on 10, so long as we get it clear.
LORD DRUMALBYN: My Lords, I have indicated what we proposed to do. I expect we shall do this by regulation rather than by putting it into the Bill.
LORD MCNAIR: My Lords, I understand that the Minister accepts the principle underlying this, and, for my part, I do not mind whether it is done in the Act or by empowering the Board of Trade to make regulations. What I do ask for is an assurance that, if the Minister is not able on Thursday to put down the necessary Amendment, he will at any rate see to it that such an Amendment is introduced into the Bill by the Government in another place.
LORD DRUMALBYN: Yes, my Lords, I certainly give that assurance. In this case, it would be difficult for noble Lords to see the Amendment be-for it comes back here again, but obviously, in due course, they will see the Amendment.
LORD MCNAIR: I am agreeable.
On Question, Amendment negatived.
Clause 21 [Extension to Scotland of provisions of Part 1]:
LORD DRUMALBYN: My Lords, as your Lordships are aware, the purpose of Part II of the Bill is to bring the law of Scotland into line with that of England and Wales. This Amendment to the Scottish provisions of the Bill corresponds to the Amendment, which I moved during the Report stage last Thursday, to insert a new clause exempting from

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the Acts agreements under which the hirer or buyer is a corporate body. I beg to move.
Amendment moved—
Page 22, line 2, after ("sections") insert ("section (Exclusion of bodies corporate)").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
LORD DRUMALBYN: My Lords, perhaps it may be convenient if I take Amendments Nos. 41C and 41D together. The purpose of these two Amendments is to bring Clause 21(g) more closely into line with Clause 16(1), as amended. The first Amendment limits the application of the clause, so far as credit-sale agreements are concerned, to those exceeding £20. The second Amendment corresponds to that which was moved by the noble Baroness, Lady Burton of Coventry, and which I accepted. I beg to move.
Amendment moved—
Page 23, line 11, leave out from first ("agreement") to ("and") in line 12 and insert ("to which the Act of 1938 applies or relating to a credit-sole agreement to which that Act applies under which the total purchase price exceeds £20").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
LORD DRUMALBYN: My Lords, I beg to move this Amendment.
Amendment moved—
Page 23, line 17, at end insert ("or the making of the hire-purchase agreement or credit-sale agreement whichever is the later").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
LORD SHEPHERD LORD SHEPHERD had given notice to move to leave out Clause 22. The noble Lord said: My Lords, on Committee stage I sought to delete Part III from the Bill and I think I mounted a fairly formidable case, or, at least, one sufficient for the Government to reconsider their case. I understand that the Government are not yet able to make a statement or to deal with some of the suggestions that are being made by those interested in car finance. In those circumstances, I do not propose to move this Amendment or Nos. 44 to 47 inclusive, but to leave it to the other place to deal with the matter.
Clause 23 [Protection for purchaser from apparent owner]:
9.57 p.m.
LORD PEDDIE LORD PEDDIE moved, in subsection (5), after "pledge" to insert:
"and any contract whereby the purchaser undertakes to execute repairs or improvements to the vehicle".
The noble Lord said: My Lords, this Amendment would extend the protection of Clause 23 to motor-vehicle repairers who complete work in quite good faith but find themselves in circumstances where they cannot enforce the usual lien against the owner largely because the hire-purchase agreement has been determined other than automatically or by notice before the hirer delivers the vehicle for repair.
On Committee stage, the noble Lord in charge of the Bill said that the protection which I wished to confer upon repairers by this Amendment already exists in law, but I am advised that this is not so. I should like the noble Lord to elaborate on the point he made on Committee stage. As I understand it, if the hire-purchase agreement had been determined by the owner, the authority to have the repairs carried out would have been lost. But the repairer need not be aware of the determination of the agreement. This is a point that I felt was not adequately answered by the noble Lord on Committee stage, although he indicated that he would be prepared to reconsider the matter. In moving this Amendment I shall be appreciative of any information he can give the House as a result of his further examination. I beg to move.
Amendment moved—
Page 27, line 7, after ("pledge") insert the said words.—(Lord Peddie.)
LORD CHORLEY: My Lords, I should like to support this Amendment. It may be that this is not a convenient place to fit this matter into the Bill and that it is not altogether reasonable to limit it to motor vehicles. But there is a substantial point here. I think the noble Lord who is in charge of the Bill said that if he could be persuaded that there was any real legal doubt on this point he would, in effect, agree that protection ought to be given to the repairer. I hope that his legal advisers have looked at this matter, because not only am I satisfied that there is a point here, but I have consulted both a barrister with much experience of this type of work

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and a solicitor who is possibly as conversant with it as anybody in London, and I have also consulted what I think most people regard as being the most up-to-date and authoritative textbook on the subject, namely, that of Mr. Goode on Hire-Purchase and Practice; and everybody agrees that there is a real question here.
If I may explain it shortly, the point is that against the owner of a car, a washing-up machine, or whatever it may be, who takes it into the repairer's to be repaired, the repairer has what lawyers call a lien that is, a right to hold on to the article in question until he gets paid for the work that he has done. But, of course, if the article does not belong to the man who lodged it there, but to somebody else—the man has perhaps stolen it, or something of that kind—then the repairer has no right to retain it against the true owner. In the ordinary hire-purchase cases—and the noble Lord is quite right on this from the legal point of view—the hirer has the implied authority, and sometimes the express authority, of the owner to carry out the necessary repairs; that is, to take it to a garage, or whatever it may be, to get the repairs done. In that case, the garage owner or the other repairer obviously has a lien. But the case which involves difficulty is the case where the garage proprietor has no reason at all to know that there is a hire-purchase agreement.
Cases like Albemarle Supply Co. v. Hind, which is the leading case (and no doubt one on which the noble Lord's advisers were relying) do not apply in a case where the repairer has no knowledge whatever that there is a hire-purchase agreement. In the case which the noble Lord, Lord Peddie, made, where there is no longer a hire-purchase agreement, because it has been cancelled but the man retains possession of the motor car or the washing-up machine, and takes it to be repaired, the repairer thinks, "Here is a man who owns a car" and takes it in and repairs it. In those circumstances, Mr. Goode says (and all the other lawyers think the same) that it is very doubtful whether the repairer has a lien. If the noble Lord agrees that this matter is even in real doubt, then I gather from what he said
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on the last occasion, that somewhere in this Bill a protection to the repairer ought to be inserted. If the noble Lord thinks that this is the wrong place, or even if they are the wrong words, I hope he will nevertheless agree with me that this is a matter which ought to be put right in this Bill, and that, if it is not done here, he will undertake to do so in another place.
LORD DRUMALBYN: My Lords, the two noble Lords who have spoken to this Amendment have said in the nicest possible way that they think I was wrong in what I said on the Committee stage. I think to some extent I did mislead the House, and for that I tender my apologies. I am glad to have this opportunity to make my position clear as regards this Amendment. But it does not follow that the Amendment itself should be accepted. I am told that in the ordinary case, when a vehicle subject to a hire-purchase agreement is taken in for repair, the repairer can exercise a lien as against the legal owner should the cost of the repairs not be met. So the law already protects the repairer in the great majority of cases.
The noble Lord, Lord Peddie, has made it clear that he is concerned with the position of the repairer who cannot exercise a lien because the hire-purchase agreement has been determined, for some reason or another (I think this is the point), before the hirer handed over the vehicle for repair. The protection afforded by Clause 2 operates only if, at the time when the vehicle is disposed of to the purchaser, the registration hook is improperly in the hands of the hirer. A purchaser for the purposes of the clause is a person to whom the vehicle is disposed of by way of sale or hire-purchase, or by way of bill of sale or pledge. All these are cases where the title to the goods passes, or may pass, immediately or at some future date, to the purchaser, and therefore the registration hook, though not a document of title, is very relevant to this type of transaction, since it, too, will or may pass to the purchaser. If the hirer is improperly in possession of it, a purchaser may well be misled into thinking that the vehicle is free from any hire-purchase commitment, and that the hirer is in a position to pass title to it.

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But I do not think that the disposal of possession of a vehicle to a garage owner for repair is in the same category at all. The garage owner, at most, will be able to retain possession of the vehicle pending the payment of his charges and, generally speaking, his lien does not carry with it any right to sell the vehicle. I doubt very much whether garage owners would, in, fact, ever demand production of the registration book before carrying out repairs to a vehicle. It is not normally the practice for registration books to be carried in vehicles in this country. In fact, the registration book itself carries a warning against carrying it in the vehicle. Therefore, even if a garage owner were prepared to ask for the registration book, a person who lived at some distance would have a perfectly good excuse for not producing it. I think the clause should be confined to those types of disposition where the purchaser might be expected to see or to obtain the registration book, and might, therefore, be misled into improper possession of it by the hirer. The noble Lord said that in that case somewhere or another there should be in the Bill protection for the garage owner, and he has invited me to look at this again.
LORD CHORLEY: My Lords, may I interrupt the Minister for a moment? I am suggesting that this Amendment goes really wider than motor vehicles. No doubt I am responsible for the Amendment as it stands, but there are all sorts of other things which have to go to repairers to be repaired, and the problem of the lien exists right through. What I was suggesting was that the Minister should give up an undertaking to look at the whole subject again, not just on the basis of motor vehicles.
LORD DRUMALBYN: My Lords, I shall be very willing to look at it again. The noble Lord will not expect me to give any commitment before I have looked at it, but I shall be glad to look at it, and I hope with that assurance the noble Lord will withdraw the Amendment.
LORD PEDDIE: My Lords, I appreciate the frank way in which the noble Lord opposite has dealt with this matter, and I am sure that no Member of this House would believe that there was any
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intention to mislead the House at this stage. In view of his assurance that he is willing to look again at this question, I have pleasure in withdrawing the Amendment.
Amendment, by leave, withdrawn.
LORD DRUMALBYN LORD DRUMALBYN moved, after Clause 26, to insert the following new clause:
Extension of advertisements to which Advertisements (Hire-Purchase) Act 1957 applies
". In section 1 of the Advertisements (Hire-Purchase) Act 1957 (which provides that that Act applies to any advertisement which includes one or more of the elements mentioned in subsection (2) of that section) at the end of subsection (2) there shall be inserted the following paragraphs:—

(d) a fraction represented as being the rate of interest or rate of charge to be borne by the hirer or buyer in hiring or purchasing goods in accordance with the advertisement;

(e) a sum stated as the hire-purchase price or total purchase price of the goods';

and at the end of that section there shall be added the following subsection:—
'(4) For the purposes of this Act—

(a) a fraction stated in an advertisement shall be taken to be represented therein as mentioned in subsection (2)(d) of this section if it is stated in the advertisement in such a way that it could reasonably be understood to be so represented;

(b) a sum indicated in an advertisement (whatever the words used) as being the total amount which, on a hire-purchase or credit sale of any goods, would be payable by the hirer or buyer shall be taken to be stated therein as the hire-purchase price or total purchase price of the goods.'"

The noble Lord said: My Lords, there are five Amendments in my name to Part IV of the Bill, Nos. 48, 49, 51 and 52, and it may be helpful if I take them together and explain what they are designed to do. As I explained on the Second Reading, Part IV of the Bill amends the Advertisements (Hire-Purchase) Act, 1957, to deal with two matters to which the Molony Committee have drawn attention. The first was that the 1957 Act requires that advertisements which contain details of payment shall give a variety of information but does not require the advertisements to do the arithmetic and state the hire-purchase price or total purchase price. The second point was that advertisements could quote hire-purchase charges as a rate of interest in ways which might

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lead the customer to think the rate was lower than it really was.
The provisions of Part IV of the Bill deal with both these points. So far, so good. But, since the Second Reading, we have been considering this part of the Bill to see whether it can be improved, particularly bearing in mind certain points which the noble Baroness, Lady Burton of Coventry, then made. The Amendments which stand in my name are the result. They are, I think it is fair to say, the follow-up of the changes which Part IV is already introducing into the 1957 Act; and this is what they do.
First, there is the new clause after Clause 26. As the Act now stands, the inclusion in an advertisement of the hire-purchase price or of a rate of interest would not in itself bring the advertisement within the scope of the Act. We think that it should. May I suggest two examples? An advertisement which says that particular goods were available on hire-purchase at "only 5 per cent." could be quite as misleading as one which also included more detailed information about the hire-purchase terms, the deposit or the instalments. Again, an advertisement which said, "Cash price £60, hire-purchase price £65" could seem very attractive to anyone who assumed he would have a couple of years in which to pay, but would look very different if it also said that the duration of the agreement would be only a couple of months. Section 1(2) of the 1957 Act sets out the "elements" which, if included in an advertisement, bring it within the scope of the Act. The new clause adds two more elements, thus bringing within the Act any advertisement which indicates a rate of interest, or the hire-purchase price or total purchase price. The second change is introduced by the Amendment to Clause 27, page 28, line 38. This deals with the following point. Although as a result of Clause 27 of the Bill an advertisement which contains details of payment will now be required to state the hire-purchase price, an advertisement which stated only the hire-purchase price would not be required to give the other essential information. What this Amendment does is to bring any advertisement which contains hire-purchase
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price or total purchase price into the category of advertisements, which contain details of payments. Such advertisements are required by the Act to give full details of the terms. The Amendments to Clause 28 are consequential. I beg to move.
Amendment moved—
After Clause 26, insert the said new clause.—(Lord Drumalbyn.)
On Question, Amendment agreed to.
VISCOUNT HANWORTH: My Lords, we have increased the financial level to which the Hire-Purchase Act applies from £5 to £20, but there is still the £5 limit applying to provisions of the Advertisement (Hire-Purchase) Act. This Amendment brings the latter into line, which on the face of it would seem a logical step. I beg to move.
Amendment moved—
After Clause 26, insert the following new clause:
Extension of advertisements to which the Advertisements (Hire-Purchase) Act 1757 does not apply
(". Section 1 of the Advertisement (Hire-Purchase) Act 1957 (which provides that that Act does not apply to an advertisement within the provisions of subsection (3) of that section) shall have effect as if in subsection (3)(b) thereof for the words ("five pounds") there were substituted the words ("twenty pounds.")".—(Viscount Hanworth.)
LORD DRUMALBYN: My Lords, what this Amendment would do would be to exclude advertisements for such things as suits of clothes and transistor radio sets and the rest. It seems to me that, where these goods are being disposed of on hire-purchase, the reader of the advertisement is entitled to the kind of protection the Advertisement (Hire-Purchase) Act is designed to give, and I do not think it would be either right or logical to exclude these. There is no reason why there should not be parallelism here between the credit-sale arrangements and the Advertisement (Hire-Purchase) Act.
VISCOUNT HANWORTH: My Lords, I am not wholly convinced by the Minister's argument, but I do not wish to press the Amendment and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
Clause 27 [Information to be included in advertisements]:
LORD DRUMALBYN: My Lords, I beg to move the next Amendment.
Amendment moved—
Page 28, line 38, at end insert—
("(4) At the end of subsection (4) of that section (which defines an advertisement which contains details of payments) there shall be added the words 'or if it states a sum as the hire-purchase price or total purchase price of those goods'.").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
VISCOUNT HANWORTH VISCOUNT HANWORTH moved to add to the clause:
"(4) Notwithstanding the foregoing provisions of this section, where separate items of goods are offered for sale in one catalogue and such catalogue indicates the cash price of each item of goods thereby offered for sale, the fact that there is included in or appended to such catalogue a general statement to the effect that the goods thereby offered for sale may be purchased by hire-purchase or credit sale and giving information as to the terms on which the goods may be so purchased, shall not be construed as requiring the information specified in paragraph (g) of subsection (2) of the said section 2 as amended by this section to be given in respect of each item of goods in such catalogue."
The noble Viscount said: My Lords, this is rather a peculiar Amendment since it is intended to assure the legality of a practice which has been in operation for many years. Under the terms of Section 2 of the Advertisement (Hire-Purchase) Act, 1937, advertisements of goods which can be bought by hire-purchase or credit-sale must give certain specified information about the terms. With the new addition included in Section 27 of the Bill which we are now discussing there are in all seven separate headings under which information is specified. These include, for example, the total number of instalments and the length of the period for which each instalment is payable.
Mail order catalogues contain a large number of items and show the cash price of each. Separately, however, from the advertisement for the specified goods there is often information on how they may be obtained on hire-purchase or credit-sale, and full particulars required by the Act are of course included. There appears to be some doubt as to whether from a strictly legal point of view each of the items in the catalogue should have the full price and hire-purchase and credit terms set out against each item. This of course is quite impracticable. I could paint a sorry picture
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of bodies corporate spending sleepless nights and rising in the morning with an anxiety to open their post, fearing that it contains a writ. But, in all seriousness, I would suggest that the Government could logically oppose this Amendment only on one or two grounds. They could say that they can clarify the legal position and consider the Amendment unnecessary, or they can propose to introduce a better Amendment at a later stage. I beg to move.
Amendment moved—
Page 28, line 38, at end insert the said subsection.—(Viscount Hanworth.)
10.15 p.m.
LORD DRUMALBYN: My Lords, I can quite understand that those who produce catalogues which give the cash prices of a large number of articles do not want to find themselves having to give a lot of additional information in each case simply because, somewhere in the catalogue, there is a general statement of the hire-purchase or credit-sale terms that are available. But what is not clear is why this point arises particularly out of the new requirement, imposed by Clause 27, that an advertisement which, in the terms of the 1957 Act, contains details of payments must state the hire-purchase or total purchase price. This is not clear, and I think that the noble Viscount skirted around this a little in moving the Amendment.
It seems to me that the point must arise equally in relation to the other information which the Act already requires to be stated in these cases—that is, the amount of any deposit, the amount of the instalments and the total number of instalments and the period in respect of which each instalment is payable. This must arise equally on those. In this particular Amendment that has been moved the total purchase price—
VISCOUNT HANWORTH: Will the noble Lord excuse me for interrupting? I made this point quite specifically. I said that there were already six items which had to be included, and that this made only the seventh. I also pointed out that for a number of years the firms have possibly been breaking the law, and I raised this Amendment at this time only to try to regularise the position. I think that most of the argument of the Minister has been directed to

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trying to prove that I have suddenly brought this up because of this Bill. I have not done that at all. I thought I had explained why.
LORD DRUMALBYN: I see. What the noble Lord is anxious to do is to put a practice which was doubtfully in order completely in order.
VISCOUNT HANWORTH: That is precisely so.
LORD DRUMALBYN: I am advised that there should be no difficulty—on the contrary, in fact—about mail order companies complying with the law by adjusting the information they give. It may be rather more complicated. The table at the end of their book may be more complicated, but I am advised that it should be possible for them to bring their practice into line with the law, rather than the law into line with their practice.
VISCOUNT HANWORTH: I am sorry, but the thing is completely impracticable. If you look at a catalogue like this, containing some thousands of items, it simply is not practicable to put in the complete terms for which each item can be sold under hire-purchase or credit-sale terms. It would need about six or eight inches. If they are to carry on under this arrangement it is simply not practicable. I think the Minister should look at this most seriously.
LORD DRUMALBYN: If I may speak again, I am perfectly prepared to look at it again. I was not suggesting that alongside each single item this information should be set out separately. What I was suggesting was that it would possibly be within the law to make out a table at the end that would enable people to calculate this information in a way which would comply with the Act.
On Question, Amendment negatived.
Clause 28 [Information as to rate of interest or charge]:
LORD DRUMALBYN: My Lords, I beg to move.
Amendment moved—
Page 29, line 4, leave out from ("contains") to ("shall") in line 8 and insert ("a fraction represented as mentioned in section 1(2)(d) of this Act").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
LORD DRUMALBYN: My Lords, I beg to move.
Amendment moved—
Page 29, line 16, leave out ("stated") and insert ("represented").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
LORD DRUMALBYN: My Lords, I beg to move.
Amendment moved—
Page 29, line 27, leave out subsection (3).—(Lord Drumalbyn.)
On Question, Amendment agreed to.
Schedule 1 [Application of enactments to conditional sale agreements]:
LORD PEDDIE LORD PEDDIE moved to leave out paragraph 8. The noble Lord said: My Lords, this is a probing Amendment. The 1938 Act deals with two types of agreement, namely hire-purchase and credit-sale agreements, and a third type is introduced in this Bill, namely a conditional sale agreement as defined in Clause 17. Parts I and II of Schedule 1 give further information about these agreements. Paragraph 8 of Part II of the First Schedule states that
"A conditional sale agreement shall be treated as not being a contract of sale for the purposes of sections 12 to 15 of the Sale of Goods Act 1893 (which imply certain conditions and warranties in contracts of sale)."
Section 8 of the principal Act sets out the implied conditions and warranties in hire-purchase agreements; and in regard to credit-sale agreements similar conditions and warranties are provided in Sections 12 to 15 of the 1893 Act. But it would appear that so far as conditional sale agreements are concerned no provision is made for implied conditions and warranties.
The purpose of this Amendment is to ask why this is so. It is quite certain that the general public will not appreciate the difference between a hire-purchase agreement and a conditional sale agreement, and on the face of it—I may be wrong—it looks as though they may be deprived of certain rights. Nothing appears to have been said about this important change in the law, and my purpose in moving the deletion of paragraph 8 of Part II is in order that an opportunity might be given to the Minister to clarify the position. My Lords, I beg to move.
Amendment moved—
Page 3, line 14, leave out paragraph 8.—(Lord Peddie.)
LORD DRUMALBYN: My Lords, as the law stands at present, a buyer under a conditional sale agreement will get the benefit under the Sale of Goods Act of certain implied conditions and warranties relating to the seller's title to the goods, to merchantable quality, to fitness of the goods for particular purposes, to the correspondence of the goods with any description or sample and to other matters; but these implied terms may be excluded if the agreement says so under the Sale of Goods Act. Since, by Clause 17 of the Bill, conditional sale agreements not exceeding £2,000 are henceforth to be treated in the same way as hire-purchase agreements, the buyer under such a conditional sale agreement will receive the same protection as though he were a hirer under a hire-purchase agreement, and so will get the benefit of the conditions and warranties to be implied in hi re-purchase agreements to which the 1938 Act applies.
Since these implied terms are generally more favourable to the buyer than those in the Sale of Goods Act, and since there are important limitations on the extent and manner in which they can be excluded in the agreement, the conditions and warranties implied by the Sale of Goods Act are no longer required for the protection of a buyer under a conditional sale agreement not exceeding £2,000. Paragraph 8 makes it clear that such a buyer is to have the greater protection of the Hire-Purchase Acts. If the Amendment were accepted, it would not be clear which of the statutory provisions relating to implied terms was to apply to conditional sale agreements within the scope of the Hire-Purchase Acts.
The noble Lord asks me why we have made these changes in regard to conditional sale agreements. The reason is quite simple: that it might have occurred to some owners or sellers that they could get round the hire-purchase provisions
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by having conditional sale agreements instead. For that reason, the conditional sale agreements are brought exactly into line with the hire-purchase agreements for the purposes of these Acts. I hope that this is a sufficient answer for the noble Lord. This is purely in order to prevent the evasion of the hire-purchase provisions.
LORD PEDDIE: My Lords, with that explanation, which at least to my mind clarifies the position, I beg leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
Schedule 2 [Extension of Hire-Purchase Act, 1938, to Scotland]:
LORD DRUMALBYN: My Lords, this Amendment is consequential upon the Amendment to Clause 1(1) of the Bill, which is required in view of the new clause exempting from the Acts agreements under which the hirer or buyer is a corporate body. I beg to move.
Amendment moved—
Page 37, line 14, after ("shall") insert ("(except as provided by section (Exclusion of bodies corporate) of the Hire-Purchase Act, 1964").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
Schedule 4 [Enactments amended]:
LORD DRUMALBYN: My Lords, this is consequential on Clause 1. I beg to move.
Amendment moved—
Page 51, line 4, column 2, at beginning insert—
("In section 1, after the word 'shall', in the first place where it occurs, there shall be inserted the words '(except as provided by section (Exclusion of bodies corporate) of the Hire-Purchase Act 1964)'").—(Lord Drumalbyn.)
On Question, Amendment agreed to.
House adjourned at twenty-seven minutes past ten o'clock.