Debate on the Address

Part of Sessional Orders – in the House of Commons at 12:00 am on 9th June 1955.

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Photo of Mr Henry Price Mr Henry Price , Lewisham West 12:00 am, 9th June 1955

I wonder if the "Observer" referred to the economic crisis of 1951, too. The Opposition did not in the Election campaign.

Now I want to continue with the speech which I intended to make. If I were to refer to all the subjects in the Gracious Speech which interest me I should gravely trespass on the advice given to the House two days ago by Mr. Speaker, who suggested a limit of about 20 minutes. The one subject which seems to be foremost in the minds of hon. Members is the question of monopolies and restrictive practices, and strangely enough that is the topic on which I want to say a few words, although there are many other topics in the Gracious Speech which I warmly welcome, notably the development of nuclear energy, the modernisation and re-equipment of the railways, the reconstruction and improvement of roads, the slum clearance programme and the attention to be given, as was underlined by the Prime Minister, to education.

The question of monopolies and restrictive practices has recently achieved some limelight as a result of Press reports to which reference has already been made, namely on tenders to the London County Council for steel girders and, more recently, on tenders for cement. I have found it a little difficult to understand why these reports should gain so much publicity. In the paper industry, of which I am a member, this sort of thing is happening every day. I referred to it in the debate on the Gracious Speech last year —as far as I am able tell, without causing a ripple; not that that disturbs me, it is an experience to which I have become accustomed. I want to return to it today. In doing so, I must declare an interest in that I am a member of the paper trade.

The situation has deteriorated somewhat in the past 12 months. I want to deal with it under two separate headings, the first of which is price. In the paper trade there is an agreement that all the mills making a particular grade of paper shall charge a particular price to the merchant. As a merchant, I can go to any mill making any particular grade of paper, and I must pay the same price to any mill. Not only that; my resale price is also fixed. If I buy one ton for direct delivery to a customer, I must charge 6¼ per cent. profit, no matter how keen I might be to do it for less. If I put the paper in a warehouse and deliver it to my customers in small quantities, I must add 33⅓ per cent. profit, no matter how willing I am to do it for less. If I transgress, if I sell direct at less than 6¼ per cent. profit, or sell ex-warehouse at less than the margin laid down, I am open to being blacklisted and denied all future supplies of that quality of paper from those mills.

That is the position which existed last year and which exists today. All competition by price is ruled out. There remained competition by efficiency and by service, but that is also being erased, and I can best illustrate that by quoting an example. I hope that the House will forgive me for talking in the first person, but that is the best way to put this point across.

Not long ago I received an inquiry from a firm of printers I know well for 4 tons of paper of a well-known quality made by a very well-known mill. I sent the inquiry to the mill, but was told that the mill could not quote. The reason was that I had not had this order in the past and so I had no quota. They could only quote merchants who had bought this kind of paper in the past. In other words, not only was competition by price ruled out, but competition by service was ruled out, too. The merchant who had the order in the past must get it again no matter how keen the printer might be to place the order with another merchant, more agreeable, more enthusiastic, and more efficient though he might be.

The printer can no longer buy where he likes. He must go to the same merchant as in the past. Not only have we eliminated competition by price, but we have eliminated competition by service and efficiency too. Trade is ossified, enthusiasm and efficiency are denied their reward, and lack of enthusiasm and lack of efficiency are insulated against their proper consequences.