Clause 2. — (Prohibition of Other Measures for Maintaining Resale Prices.)

Part of Orders of the Day — Resale Prices Bill – in the House of Commons at 12:00 am on 12 May 1964.

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Photo of Mr Douglas Jay Mr Douglas Jay , Battersea North 12:00, 12 May 1964

I beg to move Amendment No. 15, in page 3, line 20, at the end, to insert: (4) Nothing in this section shall make it unlawful for a supplier to withhold goods from any dealer to whom he has not previously sold goods or who refuses or fails to comply with a requirement by the supplier that he shall pay cash or the equivalent of cash on order. The Amendment deals with two points: first, the withholding of supplies from dealers with whom the manufacturer has never previously traded, and, secondly, the condition that cash or its equivalent shall be paid for the goods. The latter question of cash and credit arises under a later Amendment No. 20, which is to be moved by the Government. I therefore confine myself to arguing the case of the supplier who is to be compelled to sell goods to somebody with whom he has never dealt.

As I said earlier, most of the difficulties of the Bill, particularly this part of it, arise from the attempt to induce people to trade with those with whom they do not wish to trade. I cannot go quite as far as my hon. Friend the Member for Wednesbury (Mr. Stone-house), who merely argues quite simply that unless we have some provision about the withholding of supplies the whole Bill will be null and void. That argument constitutes a case for preventing the withholding of supplies in some circumstances, but it need not carry us to the extreme length with which we are now confronted in the Bill.

Nor is it wholly convincing to say that any supplier can defeat the purpose of the Bill by withholding supplies. My hon. Friend argued that that was easy in every case. We have to remember as the background of this discussion that the collective boycott is now illegal in any event. Therefore, if one manufacturer withholds supplies from a retailer, the retailer may get supplies from another manufacturer. It is impossible to say in a given case quite how the economics will work out. That is not, therefore, a sufficient answer to the argument.

We have reached the point—I say this to show how modest and moderate our Amendment is—when it is accepted that the Bill will compel a number of traders to sell goods to those to whom they do not wish to sell. We have also accepted that if the supplier is not to do that, the onus of proof is upon him to make his case in court that his motives were such and such. We have also accepted that he must prove what his motives were. In view of our decision on the last Amendment, we have accepted that he has also to prove what his motives might have been. That seems to be going quite far enough.

It is just possible that one could justify the introduction of that degree of compulsion into trade as a sanction for the ultimate purpose of the Bill, but to go beyond that and say that the supplier is to be compelled, on pain of all these legal proceedings, to supply somebody whom he does not wish to supply, and somebody with whom he has never done business before, is to carry the Bill to extremes.

I ask the Government to consider whether it would not introduce a little reason, moderation and common sense into this Measure if we were to stop at this point and say that all these provisions would not apply where the dealer who demanded supplies was somebody with whom the manufacturer had not done business before. The Minister, or someone on the Government side, said earlier that it would be wrong to discourage new entrants into the trade. It was the hon. Member for Stratford-on-Avon (Mr. Maude). Of course it would; but, of course, if the Government accepted this Amendment it would be perfectly open to the manufacturer to deal with new retailers if he wished to do so. There would be a free choice on either side. All it will say is that he will not be compelled to supply those people against his will in the circumstances laid down in the Bill.

It really does seem to me to be going to extreme lengths to introduce compulsion of this order. When we have debated the location of industry we have sometimes talked of direction, and a lot of nonsense h as been talked about direc- tion. It is sometimes suggested that we can compel people to put factories where they do not want to. We on this side of the House have often pointed out that one cannot by law compel a man to build a factory where he does not wish to. What one can compel him to do is not to build one where one does not want him to. That is perfectly possible, and it may be a wise thing to do. A lot of things said about direction, including a remark by the Prime Minister at Question Time last week, are really no more than nonsense.

What the Minister here is doing is to introduce a real measure of direction into trade, if he says that somebody has to start trading with a retailer with whom he has never traded before, on pain of legal action. This is carrying the process to a really extreme point, and I would suggest to the Minister that, having accepted all those other provisions, which may perhaps be necessary, it really would be wise to stop at this point and to accept the very modest limitation contained in this Amendment.