The hon. and learned Member for Darwen made the point about size much more effectively than the right hon. Member for Mitcham has made it, and I will come to that point shortly.
The Bill is about competition. It amalgamates the Monopolies Commission and the National Board for Prices and Incomes, but it does a great deal more than that. First, it establishes certain rights which the Government should exercise on behalf of the public through the instrumentality of a Commission such as this. The first right is to investigate and to bring matters of importance into public view—through educational reports, to follow what the right hon. Gentleman was saying in his opening speech, reports in respect of which there is no power in the Government unless something is found to be against the public interest.
The second right is the right to check on results. It has been eloquently argued on both sides of the House that in modern competitive conditions, taking account of international trade and of modern economic scales of production, it is to be expected that in many cases larger size will mean greater efficiency and reduction of costs. If that be so—and it is so in many cases—do not let us assume that it is achieved. If there is to be a reduction in competition, we have a right to check.
Reference was made to the influence of greater disclosure. More disclosure would certainly be of great assistance in considering mergers and their results and would be of particular assistance in respect of large companies. One thing the Bill does is to provide a reserve power in respect of disclosure. We are trying to establish a voluntary code of financial disclosure, with this power to back it up. My hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) asked me what was the present position.
We have established a working party on disclosure, the first meeting of which is to take place shortly. The members of it are the Department of Employment and Productivity, the C.B.I., the Stock Exchange, the Institute of Chartered Accountants, the Board of Trade and the Ministry of Technology. Where necessary, we will have discussions with the City Take-over Panel.
The third right is the right to intervene, again where necessary to preserve competition or where necessary to deal with the situations which result when, for good reasons, one has to accept a reduction of competition in order to get the right economies of scale.
The hon. Member for Guildford (Mr. David Howell) strongly supports this right to intervene. He said today that he strongly supported the right to intervene to preserve competition because, he said, there was a need to intervene to support and preserve competition. He made the same point towards the end of last year when he said:
Competition is not a natural phenomenon. It is a phenomenon only maintained by an increasingly sophisticated form of intervention."—[OFFICIAL REPORT, 3rd December, 1969; Vol. 792, c. 1647.]
Evidently the hon. Gentleman does not like the Bill, but what he calls intervention will be called interference and meddling by many of his hon. Friends. However, I agree that we need intervention to preserve competition.
We are concerned here not just with the regulation of monopoly abuses or the control of restrictive agreements. There is a need for action against the prevention, distortion and restriction of competition.
I am asked why we do not limit this to monopolies and why size is introduced into the Bill—size both in respect of mergers and in respect of market power references. The monopoly criteria in any case—[Interruption.] I will not quarrel with the hon. Member for Wanstead and Woodford—market power or non-market power. Often one does not know in advance until one has made a study. The hon. Gentleman should not assume that one can make a reference with certainty as to whether action against the public interest or a situation of market power or a restrictive agreement will be found to have been operating, despite the existence of the 1956 Restrictive Trade Practices Act.
There is this size criterion, though it is not in itself a criterion for reference. The monopoly criterion is a conventional figure—one-third of the market. I do not know what sort of validity the hon. and learned Member for Darwen attaches to one-third of the market. It could be 25 per cent.