§ 1. The Board's primary policy is to place the available manufacturing work with the most economical source. Economics in this context comprise not only price, but factors such as satisfactory delivery. Where on the above basis the quotations from railway workshops and private firms are comparable in their essential features, the Board will allocate the work to railway workshops.
§ 2. To implement this policy, the Board will normally seek competitive tenders from railway workshops and private firms. There may, however, be a minority of cases in which manufacture by either the railway workshops or private industry is the only appropriate course to take. This applies particularly to proprietary designs, where the designing firm or workshop, subject to its prices and delivery being reasonable, will be given a share of the production, the size of the share being determined on a case by case basis.
§ 3. The Board do not intend to manufacture in their own workshops power equipments for traction purposes.
§ 4. The Board intend to tender, where appropriate, for the manufacture of certain equipment for other boards or their subsidiaries or for the subsidiaries of the Holding Company.
§ 5. In pursuing their manufacturing policy, the Board will give consideration (with due regard to the Minister's eventual approval of the lines on which their research functions are to be exercised) to the need to encourage technical advances in the design of rolling stock, containers, and other railway equipment, as a means whereby the railways can benefit from advances in the engineering industry generally.
§ The Board will also give consideration to the need to stimulate manufacture in Development Districts,
§ 6. It is quite possible that rail customers may increasingly wish to own their own rolling stock and containers; particularly the latter. The Board are advised that so long as privately-owned railway equipment is manufactured for use of the Board's railway system or on that of any other Board (within the context of Section 1 of the Transport Act, 1962), which has railways, the Board can themselves lawfully tender for the manufacture of that equipment; otherwise they cannot. It is the intention of the Board, therefore, to seek opportunities to tender for the manufacture for their customers of privately-owned railway equipment which is to be used either on British Railways or on the railways of any other Board."
§ While reserving the right at any time to examine the validity of the costing arrangements of the Board's workshops, I have approved the proposals, with the following modifications: 92W
- (i) I have declined to approve proposal 6;
- (ii) I have withheld my final decision on the proposals as they affect locomotives pending the outcome of current discussions between the Board and the private locomotive industry.