Orders of the Day — Clause 1. — (Control of Liquid Fuel.)

– in the House of Commons at 12:00 am on 12th July 1967.

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Photo of Sir Peter Emery Sir Peter Emery , Honiton 12:00 am, 12th July 1967

I beg to move Amendment No. 1, in page 1, line 10, at the end to insert: Provided that such orders shall not come into operation until they have been approved by both Houses of Parliament. As we are now in Committee, perhaps I had better again declare an interest, and I hope that this is the last time that I shall need to do so.

10.30 a.m.

It was made clear on Second Reading that most extensive powers can be taken tinder the Bill. No one who wishes to see the proper allocation of fuel oil wishes to do other than give the Government power to ensure that if there is a shortage, the fuel oil will be fairly distributed to all consumers. In such distribution it is imperative that the public services, public institutions and other vital services of the country are properly looked after. Nobody would argue about that. But because the powers which the Minister can take are so all-embracing, it would be of benefit to the House and to the public to be certain before they came into operation of the manner in which And the organisation by which these powers would be used. I am not suggesting that the Amendment limits the Government other than making certain .hat the powers which the Minister wishes to take would be approved by the House. For example, the Minister might think of powers allowed by the Bill which he would never consider taking. Before any Minister brought specific powers into operation the House should have an opportunity to consider them and to approve them.

I know that a number of arguments Rill be used against the Amendment. I shall be told that this is not the position under the Defence Regulations or the Emergency Powers. But these are not Defence Regulations. This is an enabling Bill, and because it differs from the Defence Regulations it is wrong to try to create more and more precedents which allow extensive powers to be given 10 Ministers without the House having approved of the day-to-day operation of them. Surely that is why the House exists—to guard the rights which we give to the executive. I see no reason why the Government should not accept the Amendment. It would be in their interests to make public the powers they want to take and to ensure that if there is criticism it can be voiced before the powers begin to operate. It is clear that under the present procedure there would be no action which the House could take before the operation of the powers.

If the Minister opposes the Amendment, will he at least put on record what he has in mind of the kind of powers which he wants and those which he does not want? How will he deal with such matters as the rationing of liquid fuel for transport in rural areas? This may be a small matter, but it is of vital importance in areas where bus services are irregular, and already there are major complaints about them. If the fuel for the operation of these services were cut, there would be major objections from people living in the area. What consideration has the Minister in mind for taxi drivers? I understand that they are to gather in the Lobby of the House later today. He should help people to be more certain of the general situation. We have to consider commercial travellers, doctors and others.

None of this was dealt with on Second Reading mainly because, for reasons of time, it was a short debate and it was felt that these points could be left to Committee. If the Minister will not accept the Amendment, what are the methods of rationing which he proposes to adopt? There is a variety of methods available. What are his general views about them. The Bill as it stands is no doubt of the greatest convenience to the Government, who can do whatever they like under it. It might even be argued that it is inconvenient for the House of Commons, because if my Amendment were accepted the House might have to be recalled to consider the affirmative Resolution. But when we talk about the convenience of the House, let us first think of the convenience of the British public. I say that even though no hon. Member would want to come back from his holidays. It would be wrong to put the convenience of the House before the convenience of the public, or before the right of the House to protect the public.

Reports from Libya, Kuwait and elsewhere suggest that this exercise will never have to be undertaken. We all hope that that is so. But if an Order had to be introduced in the middle of September, we must bear in mind that it would be an extension in peace time of the rationing of a major commodity—a commodity which affects the life of practically everyone in the community—and the House should deal with such an extension by affirmative Order. Probably not all hon. Members would need to return.

Even the Government realise that an affirmative Order is a limitation on them. The limitation is that they have to be that much more careful about the powers which they take. Under the negative procedure they can proceed as they wish, and there is a fait accompli, but under the affirmative Resolution procedure they have to consider carefully before powers are introduced. I feel that in the Amendment we are protecting the Government's interests so that no one will be able to criticise them for adopting an all-embracing measure of control. The Government should take the powers they want in an affirmative Resolution which the House would approve. The House should have the right to consider any minor points or major extensions of powers which it might think wrong in certain circumstances.

Photo of Mr Kenneth Lewis Mr Kenneth Lewis , Rutland and Stamford

Further to the point of order which I raised a few minutes ago, Sir Eric, when you stopped me in full flight, I was rather taken aback as I did not think there was any difference between raising a point of order in Committee and raising it in the House. If you will listen to what I have to say, it may help you and it will probably help me also, I shall not repeat what I said before, but I should like to point out that the situation is very serious. We are trying to run the House almost on a 24-hour basis, and the strain on the staff, the police and all the Officers of the House is completely and absolutely intolerable because of the way in which the Leader of the House has organised the business. Therefore, I believe it is necessary that when we have a morning sitting there should be relief for the staff. I suggested this, Sir Eric, to the Leader of the House at 6 o'clock in the morning two days ago—

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

Order. I really cannot allow this. This is not a point of order which can be raised during this Committee stage.

Photo of Mr Kenneth Lewis Mr Kenneth Lewis , Rutland and Stamford

I am coming to the point of order—

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

No, the hon. Member cannot. I have ruled that this is not a point of order which can be raised in this Committee.

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

Order. The hon. Member has heard my Ruling. He must observe it.

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

No, the hon. Member must not dispute my Ruling.

Photo of Mr Kenneth Lewis Mr Kenneth Lewis , Rutland and Stamford

I beg to call your attention, Sir Eric, to the fact that strangers are present.

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

The Question is, "That strangers do withdraw".

Question put and negatived.

Question again proposed, That the proposed words be there inserted.

Photo of Mr Eric Ogden Mr Eric Ogden , Liverpool, West Derby

There is a natural inclination on this side of the Committee to view with a certain amount of suspicion and caution Amendments moved by hon. Members opposite, particularly when they are moved with such vigour after the kind of sittings that we have had during the last two days. However, I will concede right away that there is a degree of merit in the Amendment which has been moved by the hon. Member for Honiton (Mr. Emery). His argument is that if things were done in the way proposed in the Amendment, the Government would have to come to the House—

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

On a point of order, Sir Eric. I understand that the bells are ringing in the House. Can you enlighten me why that should be? Is there a Count, or a Division, or has the House adjourned?

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

I have no idea why the bells are ringing. I will have inquiries made. Mr. Ogden.

Photo of Mr Kenneth Lewis Mr Kenneth Lewis , Rutland and Stamford

Further to that point of order, Sir Eric. Are we to have a vote on the Motion "That strangers do withdraw" later in the day? Surely we cannot have a vote late at night on whether strangers be ordered to withdraw during the day time.

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

The Committee has decided. I put the Question to the Committee and I collected the voices. Nobody voted in favour of strangers withdrawing. A number of voices voted against it. The Committee, therefore, decided that strangers should not be ordered to withdraw.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

Further to that point of order. If the Committee had wished to have a Division on whether or not strangers should be ordered to withdraw, how could it have had that Division if a Division cannot take place until the end of this sitting, which might be in the early hours of the morning? This raises a major constitutional difficulty for the House. If it were the wish of hon. Members that strangers be ordered to withdraw, the House could not express a decision in the matter until strangers had been present for a further 12 or 15 hours after the House had wished to have a Division. This is a difficult matter, Sir Eric, and I would be grateful if you could give a ruling on how the House could proceed in such a case.

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

The hon. Member realises that his question is purely hypothetical. I will certainly consider what the position would be if such a hypothetical situation were ever to arise. Mr. Ogden.

Photo of Mr Eric Ogden Mr Eric Ogden , Liverpool, West Derby

Thank you, Sir Eric.

10.45 a.m.

It might be useful to remind the Committee that I was about to express a certain amount of agreement with the hon. Member for Honiton. He almost lost my sympathy by speakin4 so cheerfully and vigorously at thin time of the morning. However, I will concentrate on his case rather than on the way in which he presented it. If his suggestion were adopted, then should the Government decide that it was necessary to use the powers that we are presumably going to give to them, they would have to come to the House and explain why they thought it necessary to introduce these powers, and part of that explanation would consist in proving that they had done all they could to avoid having to use the powers. We on this side of the Committee trust the Government to do all that is necessary to avoid using the powers. We do not believe it to be necessary for the Government to come to the House and report what they have done.

Perhaps this morning, either on this Amendment or on Third Reading, we may be given some information about the state of our reserves. Perhaps we may be told what change there has been in purchasing fuel in different parts of the world in order to maintain our reserves. I understand that at the moment we have lost about 20 days' supply. The Minister is asking for very strong powers, and we should like some indication from the Government of their thinking in the matter of replacing supplies before finally granting these powers to the Government.

I wish to draw a comparison between the fuel situation in the country today with the situation about 12 months ago when, because of the seamen's strike, there were difficulties in obtaining fuel supplies. Certainly in the south and south-eastern power stations there was an efficient operation by which oil, which we were having great difficulty in importing, was substituted for coal. If the Minister is saying that he is considering the necessity to restrict liquid fuel, he should indicate how he is going to maintain supplies of fuel and substitute them for our own indigenous supplies. My information is that at the moment the amount of oil burned in the south-eastern power stations is 25 per cent. more than last year. This is a large amount at a time when I would have thought that the oil consumed in the power stations should be reduced and replaced by our own indigenous fuel. I should also like to know whether there is a possibility of replacing oil with gas.

If it becomes necessary to introduce rationing, it will have to be done quickly. The implementation of the decision will have to follow very speedily. It will be no use putting on the Order Paper an Order introducing rationing and then debating it some time later. I should like the Government to explain these two points—what they are doing to save our fuel, and what they will do to safeguard against a gap between announcing a decision to ration fuel and then implementing that decision.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

I support the Amendment moved by my hon. Friend the Member for Honiton (Mr. Emery).

The Amendment, Sir Eric, which you have said may be discussed with this one is in similar terms and has the effect of changing the negative procedure to the positive procedure in the event of an Order being made to introduce petrol rationing. This would mean that if it were decided during the Recess to bring in petrol rationing, the Government could not do so unless they recalled Parliament to get the Order passed. But there are still two or three weeks before the House rises in which the Government can make up their mind. It is important that they should make up their mind in the next two or three weeks about whether we should have petrol rationing. If they are unable to make up their mind before we rise for the recess, it would be only right for Parliament to be recalled if, having dithered for another three weeks, they decided that petrol rationing should be introduced while Parliament was in recess.

There are two important points which the House would have to consider if a decision were taken to lay an Order introducing petrol rationing. First, it would have to consider what form the rationing should take—whether there should be a basic ration and a small supplementary allowance, or a small basic ration and a large supplementary allowance. It would have to be decided how much the ration should be and there would be a mass of detailed administrative questions about the form of rationing. There is, however, a much more important consideration, and that is whether the Government would be right, in view of the political situation in the oil-producing areas, to introduce petrol rationing.

It is a terrible admission of failure that, in a period of over-supply of crude oil, and when wars are confined to the Far East, we should be humiliated by having to introduce petrol rationing again. The House would be wrong to allow the Government to proceed with petrol rationing without knowing why it was necessary.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

The hon. Gentleman talks about the Government introducing petrol rationing "again". The Government are not introducing petrol rationing. Can the hon. Gentleman remember when petrol rationing was last introduced?

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

The last time was when there was a very similar Middle Eastern crisis. It is food for reflection that, although they have tried to take a detached view of the Middle Eastern conflict, the same conclusion has been reached that it may well be necessary to introduce petrol rationing. I hope that we can all agree that the theory that our military operations in the Middle East or anywhere else have the effect of protecting our sources of supply can no longer be held.

The House would need to know before agreeing to an Order what the stocks were and what the supply position in the major supplying countries was. We have been given far too little information about the stocks and the extent of the cut in supplies. I can understand that some of this information is confidential and that it would not perhaps be wise to divulge all the information, but I hope that the Government will give the House the maximum possible amount of information about the supply position and also any information which they can properly release about their negotiations with the Arab countries.

It may be that it is a justifiable risk not to introduce petrol rationing because if the gap between supply and demand is very small or, in the opinion of the Government, will not become large, it can probably be dealt with by increasing the price of petrol. Increasing the price by only a few pence would have the effect of cutting consumption by a certain amount. If the gap were very big and there were an enormous shortage, rationing would be not only right but desirable. When rationing was last introduced, 1s. was put on the price of a gallon of petrol. The present increase is only 2d. Although the consumption of petrol will not be greatly discouraged by the price increase, before agreeing to petrol rationing, I should wish to be satisfied that temporarily raising the price will not do the trick.

It is clear that prices would have to go up, because if there were rationing and a consequent large cut in the consumption of petrol, the Revenue would suffer drastically as an enormous amount of excise revenue would not be received due to the cut in consumption. It is fair to ask the Minister how he foresees this difficulty being overcome. Therefore, I ask the Minister to tell us a little more about the Government's intentions about the price of petrol.

The hon. Member for Liverpool, West Derby (Mr. Ogden) said on Second Reading: I hope that I am wrong but I do not believe that this is the last time we shall have difficulties over oil supplies from overseas."—[OFFILIAL REPORT, 6th July, 1967; Vol. 749, c. 2132.] This is an intolerable position for us. As the Minister said, it is not long since we had a similar threat to our supplies. Now we have another, and the hon. Member for West Derby fears that we might have a third at some unspecified time. It is wrong that this country should continue to be in such a position that its petrol supplies are at risk. But it is not surprising when one considers tale situation.

In the first quarter of this year, 57 per cent. of our crude oil supplies came from east of the Suez Canal and had to go through the Suez Canal. Of the total supplies, 74 per cent. came from the Middle East. I understand that during the latest crisis about 67 per cent. of our oil has been cut off. Now that the Nigerian oil has been cut off, if indeed it has, that adds a another 10 per cent., making the fantastic total of 77 per cent. of our crude supplies being interrupted at one time. Perhaps nobody could predict that we should lose both the Middle Eastern and Nigerian sources, but it is fair to point out that there should be far greater diversification of our oil supplies. I know that we are doing all that we can to achieve that, but I hope that the Government will take seriously the need to widen the areas of supply so that we are not again in a position in which 77 per cent. of oil supplies are cut off at one go.

I am one of those who do not believe that economic sanctions should be used for political ends. This is what has happened to us. We have been the victims of savage economic sanctions because we are thought to have backed one side or the other in a dispute in the Middle East. We are merely having done to us what we have been trying to do to other people in the world. I hope that we can learn the lesson from this that economic sanctions are not the way to implement one's political beliefs. We have only ourselves to blame because we were the first to start it. I hope that the lesson will be learned that once a responsible commercial nation of this sort leads the way on a course of economic sanctions, blockade and economic warfare, it has only itself to blame if the same weapon is used against it, as it was used 10 years ago and as it has been used on this occasion.

I hope that the Government will tell us some more about the stocks position, about the negotiations position and what they will do when the oil flows again. I hope that we shall hear what the chances are of petrol rationing and that we shall find other ways to protect our sources of supply and will diversify and broaden the basis of supply so that we are not again at the mercy of economic sanctions imposed by régimes which wish to express political disapproval by rather cheap, petty ways such as this.

11.0 a.m.

Photo of Mr Eric Varley Mr Eric Varley , Chesterfield

Most hon. Members present have been up all night, and I do not wish to detain the Committee for very long. I wish merely to reinforce the points made by my hon. Friend the Member for Liverpool. West Derby (Mr. Ogden). If the Amendment were incorporated in the Bill, the Minister would have to tell us what he proposed to do in any subsequent rationing scheme and what the effects would be. He would have to demonstrate the necessity, and that the allocation of liquid fuel was to be determined fairly and equitably. He would also have to tell us where there could be savings.

In considering how far liquid fuel could be saved, it will be necessary to examine the existing areas of industrial activity to see if there are substitute fuels for oil. As my hon. Friend said, there are two examples of the present use of oil where there is a substitute. Power stations are one, and coke ovens are the other. We are told that oil to the extent of about 12 million tons of coal equivalent goes into the power stations. I am advised that it would not be very difficult for this to be changed to coal if rationing became necessary in an emergency. I am also told that the use of oil in coke ovens for the manufacture of gas is equivalent to about 16 million tons of coal. Changing to coal would be a much more difficult technical problem in this case, but I am told that 1 million to 2 million tons of coal could be used as a substitute.

Will my right hon. Friend tell us where he could make savings if rationing became necessary, and if there has been any thinking in the Ministry on these points? The use of coal as a substitute for oil to the extent of 12 million tons coal equivalent in power stations would be a considerable saving, and I think that it could be made. Similarly, a small saving could be made in the manufacture of gas. I understand that both these things would require only a direction by my right hon. Friend. No elaborate machinery, no Acts of Parliament, and no enabling Measures would be needed. He would have only to issue a direction to the Central Electricity Generating Board and to the Gas Council.

I should be very grateful if my right hon. Friend could give us some information on these points.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Glasgow Cathcart

It is always a pleasure to follow the hon. Member for Chesterfield (Mr. Varley). Knowing how conscientious he has been in all the all-night sittings, I feel that it is a tribute to him that he can speak with such fluency. But it is unfortunate that when we are considering such an important Amendment to such an important Bill only a small number of hon. Members is present. This is a reflection on the total incompetence of the Leader of the House in organising business. It is very unfortunate that as a direct result, in his absence, we must discuss the Amendment in this way.

We have put forward the Amendment because under the Bill the Government will have very wide-ranging powers which could affect everyone. It is rather surprising that since Suez the numbers of car owners have increased so dramatically in this country that more than one family out of two now has a car. The powers in the Bill and the regulations which will stem from it will affect every person in his pleasure, business and so on.

This is why it is very important that when the administrative arrangements are determined and the Minister decides how the powers will be used, we in the House, as representatives of the people, should have an opportunity to give our views. I have nothing personal against the Minister, but if there is a wrong way in which things of this sort can be done the Government seem to choose it. Our real fear on petrol rationing is that they may make a serious blunder. The chance of making it will be greatly minimised if the arrangements will be ruthlessly probed by gentlemen like my hon. Friend the Members for Honiton (Mr. Emery) and Cirencester and Tewkesbury (Mr. Ridley). If the arrangements are subjected to the ruthless probing of these and other interested hon. Members, the chances of a mistake will be minimised.

I hope that the Minister will not think that we have any fear that he has dictatorial ambitions, but it is rather surprising that this week we have had news that alone amongst all sections of industry the nationalised power industries have increased the number of their employees over the past year. The Minister has taken over a considerable part of industry through the nationalisation of steel, and only yesterday he was engaged in discussion with the Home Affairs Committee of the Labour Party on nationalising North Sea gas.

Will the rationing powers be used in general because of the oil supply position alone or because of a deterioration in our balance of payments resulting from the purchase of alternative supplies? If there is a danger of their being used because of a deterioration in our balance of payments it is all the more important that they should be subject to affirmative procedure. If they will be used only because of a physical shortage of petrol there is little likelihood of their being used during the long Summer Recess. But I believe that the Government could have in mind that they may have to ration petrol because of a shortage of dollars or other foreign currencies needed to pay for alternative supplies.

My second question is whether, apart from suggesting that the power stations should convert to coal, the Government are putting a stop on the present proposals to change from coal burning to oil burning, particularly in the gas and electricity industries. One such proposal is being considered in Scotland at present, and it is important to know whether plans for conversions are being held up at present. They should be held up in the rational interest.

The third question was brought to my attention by my hon. Friend the Member for Plymouth, Devonport (Dame Joan Vickers). She was hoping to be present to put this point herself but she is chairing a Committee upstairs. When they come to use these powers, will the Government avoid the mistake made on the last occasion by failing to apply the powers to driving schools? The Minister will remember that, on the last occasion, driving schools were deprived of their ration, and learner drivers were permitted to drive unaccompanied. There is a real danger in this. I hope that this mistake will not be made again.

In considering whether there should be affirmative or negative procedure, it would help if the Government would indicate what their views would be about this question of driving schools. It would he important to ensure that the schools had an adequate ration of petrol, so that learner drivers were not allowed to drive unaccompanied. All driving tests should not be discontinued, and the Ministry of Transport could utilise its register of approved instructors to help with cases of people being required for other duties arising out of the emergency.

One argument which could be effectively used against the Amendment deals with delays. If we were to announce an order which had to be approved by the affirmative procedure it is just conceivable that in the interim there might be a furious buying of petrol which would undermine the purpose of the order. Two things can be said about that. I have never been impressed with stories of hoarding, because there are limits to the amount of petrol that people can buy, put in their tanks or store safely. Perhaps the argument has been overplayed, although I appreciate that it has some validity.

My hon. Friend the Member for Cirencester and Tewkesbury very reasonably suggested as an alternative that we should hive an opportunity of discussing the Order within a limited period of time. We are not wanting to disrupt the Bill and overturn its provisions. We simply want to make sure that there will be a guaranteed opportunity of a very speedy discussion of these proposals. The Government could do something foolish and wrong, and their chances of doing so would be greatly reduced if we had an immediate opportunity of discussing this.

We would want to have an opportunity of discussing the Government's arrangements very soon indeed, particularly the administrative arrangements for carrying out the rationing of petrol. This could be a considerable exercise, and I hope the Government will tell us what will be involved. How many men will be employed? How much expenditure will take place? We have been very disappointed that in recent Government decisions about employing additional civil servants and setting up new offices the responsibilities for regional development, particularly as applied to Scotland, have been neglected. Recent decisions which have gone against us include the computer centre, the National Steel Corporation and the Vehicle Licence Duty Office.

In considering whether to have affirmative or negative procedure, one thing which would weigh heavily with me are the administrative arrangements which the Government would decide upon. I hope that they will bear in mind their particular responsibilities in this area. There is a better chance of their doing so if these Regulations are subject to the affirmative procedure. If this is not so we will have to rely on the good judgment and views of the Minister. We need something more than that. We have to have some kind of guarantee that there will be a speedy or immediate discussion of these matters.

In those circumstances I hope that the Government will accept the Amendment. If they do not I hope that they will come to some procedural arrangement or understanding whereby we can have a guaranteed early discussion of these matters. If we do not have this I will not be satisfied, and I fear that the Government will do the wrong thing in the wrong way.

11.15 a.m.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

This has been a rather longer debate than I had expected, but, as the hon. Member for Honiton (Mr. Emery) said, the powers contained in this Bill are unusual for any Minister to have in a democratic society. The circumstances at the moment are somewhat unusual and the Government need these powers. There has been a tendency as the debate has continued for hon. Members to talk as if we were discussing the introduction of rationing. We are not. No proposals have been made for rationing and the Government have no suggestion for rationing at the moment. None the less, if it had to come into operation it would clearly be sensible that some machinery should exist.

I was asked a number of questions, on some of which I shall be less forthcoming than on others. Hon. Gentlemen ask for details of the current stock position and the sources of supply. I have nothing but admiration for their desire for knowledge, but I can be rather less than forthcoming on some of these points. This is the sort of debate which, while it may not attract a large audience here, may well have its proceedings read with great interest in other parts of the world.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Glasgow Cathcart

There is plenty of coal.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

We certainly have plenty of coal. That is something of an understatement. All preparatory measures are being taken. It is more difficult to start too late. We have printed and are printing vast quantities of coupons; we are dealing with the provision of accommodation, the selection of key staff, the posting of advance parties to regional offices to get things ready for rationing should we need it. I stress "should it be needed".

The main body of staff will not be moved until a firm decision has been taken to issue the ration books. Even the issuing of the books does not necessarily imply that the decision to ration is irrevocable. In any event, rationing cannot be introduced until some weeks after these procedures. What we are doing, very prudently, as a House, is saying: "Here is a situation which is extremely inconvenient—certainly not disastrous—and which could, at some unspecified date in the future, result in the need for rationing".

Rationing in this country is a very large-scale operation. One hon. Gentleman asked for some information on the figures involved. At the time of Suez, when we had 4 million cars on the roads, it took a staff of 1,800 people. I hope this time to do it with something like 2,500 staff. I hope that most of them would come from within the service, rather than build up an outside bureaucracy. It is a very big exercise in a country as heavily populated as ours.

A number of specific points, including questions of fuel policy, coal-burning gasworks, and a possible conversion of electricity power stations, were raised. One of the many things to remember is that we are dealing essentially with a short-term crisis which, strangely enough, is not primarily an oil shortage crisis. This is something which is misunderstood. There is a great deal of oil in the world. The problem that we have is not so much a shortage of oil but of transport, involving the cost of getting it here and the physical job of doing so. It is also a very short-term problem. I do not under-estimate the strong feelings of some of my hon. Friends who will no doubt find themselves speaking, probably on Monday, about the position of the coalmining industry.

Whatever arguments there may be for converting oil-burning power stations to coal, there are fuel policy questions on which it would be foolish to take decisions of a long-term and very expensive nature on the basis of a crisis lasting probably a matter of weeks. However, this does not detract from the argument which could be deployed at considerable length on another occasion.

The Amendment is very understandable in a democratic society. It is proposed to take powers, which could be very serious and far-reaching, virtually by issue of decree. It is right for the House to be concerned about this. But if the proposed procedure were adopted it would mean that nothing could be done until the House was recalled, and it might have to be recalled not once but on a number of occasions. There is a host of possible Orders, none of which need necessarily imply a decision on rationing. Orders might have to be taken to assist us in avoiding rationing.

The procedure outlined in the Bill is that adopted during the Suez crisis when the provisions were made under Defence Regulations. There are no wider or less closely defined powers involved in the Bill than were involved then. But the strongest argument against the Amendment is that if we had to give probably a fortnight's notice of the introduction of an Order the intention behind it might be frustrated.

Photo of Sir Peter Emery Sir Peter Emery , Honiton

I am sure that the right hon. Gentleman would not want to leave the House in any misapprehension. He suggested that the powers were the same as those used after the previous Middle East crisis when the Motor Fuel (No. 2) Order, 1956, was introduced. There is a major difference. The powers then employed were under Defence Regulation 55A, but the right hon. Gentleman is suggesting that he should have an enabling Bill so that he can use the specific powers which the Bill would give him. It is wrong, surely, to suggest that the procedure is the same. The Orders under the Defence Regulation were long and extensive and set out all the queries that we are now talking about. Then one knew where one was at the start. But we do not know where we are with the enabling Bill.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

The hon. Gentleman misunderstood me. I am not claiming that the powers are the same. I am saying that the Bill does not give the Minister any greater powers than he had at the time of Suez. I appreciate that the circumstances were entirely different, but now that the Defence Regulations have gone we are faced with the simple alternative either of proclaiming a state of emergency and taking emergency powers under the Emergency Powers Act, 1920, or producing an enabling Bill. We have chosen the Bill as the least drastic of the alternatives. My prime point is that by their very nature the Orders that might have to be issued are not the sort for which we could give a fortnight's notice.

I appreciate that something would be seriously lacking in the House if powers of this sort went unchallenged. I understand the doubts expressed on both sides of the House, and agree that it will be for the Government clearly to justify any steps that they take. However, we are not necessarily talking about the introduction of rationing. Nevertheless, I think that hon. Members on both sides would agree that, given the present circum- stances, it would be highly dangerous and thoroughly irresponsible for any Government to go through the summer without the ability to take these powers if they were required. I emphasise that it would be dangerous and rather impracticable to think that these were Orders of a type of which we could give a fortnight's notice, trusting that in the meantime no one would do anything to frustrate our intentions.

I understand the Amendment and have sympathy with the intention behind it, but I think that these are circumstances in which the Government are entitled to ask the House to give them powers for which they would not otherwise be justified in asking.

Photo of Sir Keith Joseph Sir Keith Joseph , Leeds North East

I hope that my hon. Friends will appreciate the Minister's attempt to meet their case. I confess that I saw some force in his argument. However, what he said has confused me in one important respect. He said that if the Government used the powers under the Bill they would not necessarily be for the purpose of introducing rationing.

What Orders might the Government be introducing under the Bill which would not be for the purpose of rationing? We grant that there might be Orders of a kind that would be frustrated if given too much notice. On the other hand, we should be very wrong to think that liquid fuel is used entirely in transport. It is an indispensable source of energy for a whole range of industries and utilities. The people in charge of those industries and utilities will need some warning if their source of supply is to be altered. How will the right hon. Gentleman reconcile, on the one hand, the need not to give too much notice so that his plans might be frustrated and, on the other hand, the need to give warning to citizens of all sorts in industry, agriculture, commerce, utilities, public services and private life that their source of supply is to be altered? Many of us would be grateful for a little more guidance on this.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

The right hon. Member for Leeds, North-East (Sir K. Joseph) is right when he says that many different products besides gasolene are involved and that there are many different classes of consumer other than motorists.

The Bill gives powers for general Orders and particular Orders. Circumstances could arise where a product was in short supply to a very small group of people. In those circumstances the Minister would have power, for example, to direct that supplies should be made available for that purpose. There might then be an attempt by the person so directed to avoid the direction by increasing the price of his product—I am citing a purely hypothetical possibility—to such an extent that it would be impossible for the prospective buyer to purchase. In those circumstances the Minister has power under the Bill to direct that the price shall be a reasonable one. These are the sort of possibilities which could arise—they might well not—which would not of themselves justify introducing total rationing throughout the community.

Photo of Sir Peter Emery Sir Peter Emery , Honiton

I thank the right hon. Gentleman for his reply. I realise his difficulty. We do not want to thwart his ability to be able to control the situation. My hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor) introduced the most important question whether the Government would think of using these powers in connection with the balance of payments position rather than supplies. I hope that that will not be the case, but the Minister should tell the House what he has in mind, or let us know that he is not willing to reply.

The Minister used the very strange argument that if the Amendment was passed the House would possibly have to be recalled on a number of occasions because of the need for different Orders. I have a great regard for the Minister's administrative competence, but it would be administrative incompetence of the greatest order if, having put the Order before the House to take specific steps, he did not ensure that he was covered so that he did not have to recall the House. The Minister's Department and staff have the highest reputation for working in close co-operation with industry. They are the people who usually get the brickbats—never any praise—but I do not believe that his staff would allow him to be so administratively incompetent as to have to recall the House on a number of occasions.

The hon. Member for Liverpool, West Derby (Mr. Ogden) mentioned the specific point of the time between the administrative resolution being tabled, the recall of the House, and the action taken. The Minister argued that it was necessary to be able to act quickly and that rationing could not be implemented until some weeks after the decision was made. There will therefore be a gap between the decision being made and the setting in operation of the whole machinery.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

The hon. Gentleman is missing the point. It is possible to need to introduce the Orders—this is all sheer hypothesis—without necessarily requiring rationing.

Photo of Sir Peter Emery Sir Peter Emery , Honiton

I see that point. The hypothetical example which the Minister gave was a sudden increase in price on a specific factor. The Minister suggested that if there were a shortage of naphtha, for example, there would need to be some control on its use and he decided that the price factor would be the answer. I believe that the industry itself will wish to co-operate in close working with the Ministry to make that sort of thing unnecessary. The only Orders the Minister will have to make are for major controls, because I think there will be this delaying factor.

I remind the Minister of three points: the balance of payments, the administrative situation of having to recall Parliament, and the possibility of informing the House by a negative resolution Order or giving some publicity to the way that the operation would take place if it were necessary. We are worried that the Minister might overstep the mark. I hope that this will not be the case. I do not go as far as my hon. Friend the Member for Cathcart went in saying that the Government always do everything in the wrong way. It is a fairly strong political argument which had some current relevance during the last six weeks, but let us presuppose in this instance that this would be the exception that proved the rule.

To meet our point, will the Minister consider giving some outline to the Press—it need not be to Parliament—spelling out some of his ideas to meet the criticisms and perhaps suggest the powers which he did not want to take? If he could give some favourable answer on the points which have been raised we might be able to proceed without pressing this matter further.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

On the question of introducing rationing for balance of payments purposes, the House will be tired of hearing me say that we are not talking of introducing rationing. I cannot say what at sort of hypothetical situation might exist in two, three, or four months' time or which series of factors would motivate the Government at any stage. The Government's financial position is rather stronger than that—that it should be affected by it at the moment—but these are issues for my right hon. Friend the Chancellor.

Photo of Sir Keith Joseph Sir Keith Joseph , Leeds North East

Is the Minister going bask on what his hon. Friend the Parliamentary Secretary said in answer to a question from me on whether there is freedom for the oil companies to bring in as much oil as actually required? His hon. Friend said: The answer to that is that there are no restrictions on the oil companies in this connection."—[OFFICIAL REPORT, 7th July, 1967; Vol. 749, c. 2136.] Is the Minister saying that there is any change in the foreign exchange position of the oil companies since the Parliamentary Secretary spoke five days ago?

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

I am obviously expressing myself badly this morning. I am trying to explain the precise opposite. We are not suggesting, nor are we asking for, any restrictions at the moment. All we are talking about is a Bill which we may never need—and I hope we will not—but which we could conceivably need at some period of weeks or months in the future. We do not face any great balance of payments crisis nor any great oil supply crisis, but we do face a very real transport problem. The point is that all these things are sheer hypotheses. We are asking for an enabling Bill because of what could conceivably be the position at some stage in the future. I would not want any panics to start on anything, because this is not called for in the Bill.

The hon. Member for Honiton raised the question whether we might want to recall Parliament for more than one Order. I am faced with the position that it is a matter of judgment. I do not know what the position will be in August, September, October or early November, although I could make a number of reasonable assumptions. Things could change very rapidly in this area of the world, and if they changed rapidly the Government would have to move rapidly and there would be no point in the House complaining about being called back twice.

The hon. Member asked me to spell out how the operation would take place and to give a list of powers in the Bill which I should want and a list of powers which I should not want to use. I hope not to use any of them. Which powers were used would depend on the position that existed when a crisis emerged. We might well with luck get through with nothing at all, and then the whole of the exercise will have been, in one way, a waste of time. We might, on the other hand, want some powers later just to deal with certain areas of the problem. Conceivably something catastrophic could happen. The hon. Member can go on working out the possibilities. I cannot tell him which scheme will be introduced to meet them because I do not know what they are.

I am saying on behalf of the Government that I want the powers in the Bill which will enable me to meet any situation which arises. I realise that this is asking for a lot and that it is right that this sort of power should be challenged when the Minister asks for it, and that he should be expected to justify his request.

Photo of Sir Peter Emery Sir Peter Emery , Honiton

We have some undertakings from the Minister on this matter. I hope that he will consider the point about publicity even further, but on those undertakings, and as we have other Amendments to consider, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

I beg to move, Amendment No. 2, in page 2, line 3, at the end to insert: (4) Any directions given to a person under subsection (3) of this section may include provision as to the persons to whom he is to supply any such lubricating oil as may be specified in the directions; and any such directions may in particular require any lubricating oil to be supplied to such persons as may be specified in the directions in accordance with such requirements as may be so specified or may, to such extent as may be specified in the directions, prohibit the supply of lubricating oil to persons so specified.

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

It would be convenient at the same time to discuss Amendments Nos. 3, 4, 11 and 13.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

The Amendment is designed to enable me to include provisions for lubricating oil in any of the directions given under Clause 1(3) to suppliers or refiners of liquid fuel. On the best legal advice I have, I understand that liquid fuel does not include lubricating oils since they are not used as fuel, but it is possible, because of the relationship between the two, that supply difficulties which affect petroleum products used as liquid fuel may also affect lubricating oils at the same time. For example, any reductions in the use of other products would automatically effect the demand for lubricants, but it cannot be assumed that there may not be cases in which it would be necessary for the Minister to direct that particular consumers of liquid fuel should also be kept correspondingly supplied with lubricants or conversely other consumers should have their supplies of lubricants restricted. The Amendment is merely to ensure that lubricants are also included in the Bill.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Glasgow Cathcart

Would the Minister between now and Report look carefully into the second part of Amendment No. 2 and also subsection (3), which is in similar wording? Will he see whether he can find a simple way of expressing the point? The phrase reads, and any such directions may in particular require any lubricating oil to be supplied to such persons as may he specified in the directions in accordance with such requirements as may be so specified or may, to such extent as may be specified in the directions, prohibit the supply of lubricating oil to persons so specified. There must be a simpler way of expressing that and I hope that he will try to find it.

11.45 a.m.

Photo of Sir Keith Joseph Sir Keith Joseph , Leeds North East

Will the Minister answer a point which he did not answer on Second Reading—whether lubricating oils or liquid fuel—used in the Bill—include liquid petroleum gases?

Amendment agreed to.

Further Amendments made: Amendment No. 3, in page 2, line 4, after 'fuel', insert 'or lubricating oil'.

Amendment No. 4, in page 2, line 6, after 'fuel', insert 'or lubricating oil'.[Mr. Marsh.]

Question proposed, That the Clause, as amended, stand part of the Bill.

Photo of Sir Keith Joseph Sir Keith Joseph , Leeds North East

The Minister said "Yes" in answer to my question on Amendment No. 2, but, as reported in column 2138, his hon. Friend said that naphtha is not a liquid fuel—and the Bill deals with liquid fuels. How, then, can the Minister answer so categorically that liquid petroleum gases are included? Are they covered by the Bill?

Will he tell us whether he can give us any further information about the last word of the Clause? He takes power to dictate that the price shall be "reasonable" in any circumstances in which he makes arrangements for fuel to be supplied, but the word "reasonable" is very ambiguous. There are precedents in other legislation for some definition of the word or some arbitration to be attached to it. I am thinking particularly of the Clean Air Act. Can the Minister tell us how he would judge the price as being reasonable and whether in taking power under the Bill he will lay down some arbitration procedure?

Photo of Sir Peter Emery Sir Peter Emery , Honiton

I put two questions to the Parliamentary Secretary on Second Reading and he did not want to answer them then. The Minister has therefore had notice of the questions.

When the oil companies were going out of their way to bring in supplies to meet their existing contracts, two situations could arise. One is that, because of their desire for a good relationship with their customers, they would go out to buy or charter, at a considerably greater cost, oil to meet their contractual obligations.

If the Minister directs that oil elsewhere, the company having paid the extra money to meet their contractural obligations, often they still cannot meet them because the Minister has directed the oil to meet some public need—and I do not quarrel with that. The oil companies, through good will, have spent more money than would normally be considered appropriate, and the extra cost should be paid to the oil companies when the Minister directs the oil elsewhere.

My second question is directed to the liability of companies in circumstances when it might be proved that they had supplies to meet their existing contracts but they were then directed by the Minister to move their oils elsewhere, Their breach of contract would then be by direction of the Minister, not by their own intent. Such a case may be thought unlikely, but it is possible. I hope that the Minister will give an assurance that a company would not in those circumstances be held responsible, particularly financially responsible, because of the Minister's action in directing the moving of the oil elsewhere.

Although I had intended to raise the question of liquid petroleum gas on the interpretation Clause, I think it convenient to raise it now and have it resolved. There has been a slight mix-up about 1.p.g., and there has been considerable doubt in official circles on whether it should or should not have been excluded. The Parliamentary Secretary will know what I mean by that. Are we to take it that 1.p.g. or propane is included? Is this ethane and methane, of is it not? Does it mean that the Minister has included naphtha or not? These are technical questions, but I should be glad to have answers about those gaseous feedstocks which are fuels.

Photo of Mr Richard Marsh Mr Richard Marsh , Greenwich

The right hon. Gentleman the Member for Leeds, North-East (Sir K Joseph) asked about the Minister's powers to fix a reasonable price. The Bill provides that the price shall be reasonable. What is reasonable can be decided only by the courts. But the circumstances in which these powers would be used are fairly narrow. They arise only in the case of an Order under this Clause, and the matter would depend very much on circumstances. Perhaps a person directed to supply to a particular consumer might be justified in expecting more for his product, but he might well not be justified in quadrupling his price with the deliberate intention of ensuring that the other person could not purchase it even though he had been directed to supply it. I think that the question should be capable of solution fairly easily.

The hon. Gentleman the Member for Honiton (Mr. Emery) raised an interesting point about how far the Government would carry responsibility for losses incurred by companies which found themselves in legal difficulties with their customers as a result of directions issued by the Minister. Presumably, in such circumstances, the person would be acting within the law in that he had been given a straight Governmental direction. On the other hand, on the question of what happens if the Government require a particular supplier to divert supplies elsewhere and he is thereby put to further additional cost, it would be highly dangerous if I were to start working out a series of hypothetical situations and saying what the Government would do. I think that the matter would be covered. As the hon. Gentleman knows from his own connections, we have had close contact with the companies on the whole issue and have worked closely with them.

I turn now to the question of 1.p.g. and naphtha which, for some reason, has become a subject of debate. First, naphtha is not covered by the Bill. There is no reason why it should be. The number of users of naphtha is fairly limited, and the number of sources of supply also, unfortunately, is very limited. There is a world shortage of naphtha at present. It is possible to deal with naphtha by administrative process, and it is not, therefore, covered by the Bill.

I think that the confusion or argument on the question of 1.p.g. has arisen out of the fact that 1.p.g. is in gaseous rather than liquid form at the point of combustion. But this is irrelevant to the Bill because the same could be said of motor spirit. Liquid petroleum gas is a liquid fuel, by definition, and the Bill, therefore, covers it.

Question put and agreed to.

Clause, as amended, ordered to stand part of the Bill.

Clauses 2 and 3 ordered to stand part of the Bill.