General Duties and Powers of National Ports Authority, and Adaptation of Powers of Other Bodies

Clause 6 – in the House of Commons at 12:00 am on 28 April 1970.

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Mr. Edward M. Taylor:

I beg to move Amendment No. 12, in page 10, line 9, at end insert: The National Ports Authority and its subsidiaries shall not, however, be empowered to engage in activities under section 48 of the Transport Act. 1968, unless, in each particular case, an order approving the proposal is approved by the House of Commons.

Photo of Mr Harry Gourlay Mr Harry Gourlay , Kirkcaldy District of Burghs

With this Amendment we may discuss Amendment No. 18, in page 18, line 26, leave out ' either directly or through a subsidiary'.

No. 19, in line 36, after ' activities ', insert, set up separate subsidiary companies for each activity and

and No. 21, in page 19, line 29, at end insert: (2) Every annual statement of accounts prepared in pursuance of subsection (1)(b) above shall include particulars of the results of each manufacturing subsidiary company exercising powers under section 48 of the Transport Act. 1968.

Mr. Taylor:

This is an important series of Amendments and it is appropriate that we should discuss the four Amendments together. The Transport Act, 1968, gave to the various boards powers of manufacture, supply and repair. The National Ports Authority is given the same powers in Clause 6 of this Bill.

I remind the House of Section 48 of the Transport Act, 1968, which gave power to the various bodies set up under that Act to manufacture for sale to outside persons… and to repair for outside persons, anything which the authority consider can advantageously be so manufactured or, as the case may be, repaired by the Authority by reason of the fact that the authority or a subsidiary of theirs have materials or facilities for, or skill in, the manufacture or repair of that thing in connection with some existing activity of that Authority or subsidiary… The second thing they have power to do is to sell to outside persons, and for that purpose to purchase, anything which is of a kind which the authority or a subsidiary of theirs purchase in the course of some existing activity… The third power is as follows: at any place where the Authority, in the exercise of their powers… provide a car park to repair motor vehicles for outside persons, and to sell to outside persons petrol, oil and spare parts and accessories… In that Section the nationalised undertakings can if they so wish engage in the manufacture, repair and sale of virtually anything. I challenge the Minister to say if he can think of anything at all which the transport undertakings under the 1968 Transport Act could not do if they so desired.

It might be said that there is nothing wrong with this and why should not the nationalised undertakings have the same manufacturing powers as private industry. This would be a valid argument if the same commercial disciplines were applied to the private sector as to the public sector. But we know that British Railways for various reasons, some of which were good, had over £1,000 million capital written off, were losing about £150 million a year and then happily because of a financial reconstruction made a surplus. Then there is the National Freight Corporation which, for various reasons, had millions in losses written into its constitution before it employed even one man.

We are in a situation in which nationalised undertakings could undercut private industry and put others out of jobs. We also fear that a nationalised industry might in the short term seek to engage in manufacture, or car repairs or the selling of petrol to subsidise some of their other activities and to hide a loss. These powers are now to be sought for the National Ports Authority.

It should be noted that the opening words of section 48 of the Transport Act, 1968 do not refer to the various authorities having power to manufacture anything they can do profitably or well. They just say Anything which the authority consider can advantageously be so manufactured… It does not say " profitably " or " efficiently " but " advantageously ". I believe that in this context " advantageously " means anything at all.

The Minister emphasised time and again that the ports had big problems in labour relations and in investment. I suggest that they should therefore be concentrating on running the ports in the same way as British Railways should concentrate on trying to improve the railway network. This will take up all the management skill and expertise of the National Ports Authority.

We object in principle to the extension of these powers to the N.P.A. First we object because competition between a nationalised industry and a private firm can never be fair, since the same commercial disciplines are not applied and because capital write-offs are not available in the private sector. Is the Minister prepared to give a guarantee that there will be no capital write-off by the N.P.A.? He must know that many in industry feel that it will be even more essential to have these here than it was with the railways.

Photo of Mr Charles Mapp Mr Charles Mapp , Oldham East

I can see the hon. Gentleman's purist argument on the grounds of theory. Has he related what he is saying to the practical effects which are taking place in the ports? I am not unfamiliar with Manchester. In the pursuit of its normal activities as a port it is rendering services to an associated canal company which are advantageous to that company and to the port of Manchester. I am not too familiar with Liverpool, but I think that there are similar arrangements in connection with the Mersey Dock and Harbour Board. If in the running of a port it is highly desirable that the port authority should render such a service to associated firms which is beneficial to all why is the hon. Gentleman so critical about that kind of happy development?

Mr. Taylor:

The hon. Member for Oldham, East (Mr. Mapp) made certain constructive criticisms in Committee and I always listen to what he has to say. He must know that the Bill allows all existing activities to be continued and the powers of the various authorities to continue. We are concerned with the extension of the manufacturing powers. He has a point in that there may be some circumstances in which it might be advantageous from all points of view, despite the obvious dangers, for the authorities to do this. This is why we have tabled our Amendment in this way. We have said that we will not take powers away completely but that the N.P.A. and its subsidiaries shall not be empowered to engage in activities under Section 48 of the Transport Act unless in each case an order approving the proposal is passed by the House. We are not saying that it shall not engage in these activities but that the House of Commons should be told and approve. If there is a new extension of manufacturing powers which may be unreasonable, unfair or uneconomic, we should have the chance to look at it.

That is not too much to ask when public money is involved. The hon. Member should remember what have been the practical results of extending nationalised activities. Since this Government came into power we have been writing off the capital of the nationalised industries at the rate of more than £1 million every day, which is an enormous loss. By any comparison prices of nation- alised industries go up more than the prices in other industries. In all these ways nationalisation is not a good bargain for the country. We now have the situation when I person in 4 works for the Government, nationalised industry or a public authority. That is a higher proportion than in any other country on this side of the Iron Curtain and we ought to think seriously before extending manufacturing powers further. Let us look at each case and, where an extension of manufacturing powers is fair and reasonable, I hope the Minister will accept it.

9.15 p.m.

If the Minister is not able to accept Amendment No. 12, the three Amendments which we are discussing with it are crucial. Amendment No. 19 provides that if a new manufacturing activity is established there should be a separate subsidiary company for that activity. Only in this way shall we know whether that manufacturing activity is operating at a profit or a loss. There is a safeguard that these undertakings must engage in their activities as if they were a commercial enterprise, but this will not, presumably, apply each year comparing one year with another. The only way we shall know whether these manufacturing activities are operating at a profit or a loss is if there is a separate subsidiary company and if, as Amendment No. 21 suggests, there is a separate account in the balance sheet of the N.P.A. for every additional manufacturing subsidy.

Whenever Amendments of this sort have been moved, the Minister has said in reply that the nationalised undertaking will not be engaging in the massive manufacturing activities dreamed up by the Opposition. This happened with the Transport Bill, and we have since heard grisly stories about the manufacturing activities which British Railways have been engaged in. If the Minister maintains that no great use of these powers will be made by the N.P.A., there is no reason under the sun why he should not accept the Amendments. If the activities will be few and far between, why cannot each new activity be reported to and approved by the House, and why should there not be separate companies and separate accounts?

If the Minister is not prepared to accept the Amendments the suspicion will grow that the nationalised undertakings will consider entering into various manufacturing activities to subsidise losses elsewhere. If those manufacturing activities are engaged in at a loss, the loss may be impossible to identify through the accounts. The simple way of overcoming this would be to apply the Companies Act to the N.P.A. If private companies engage in a separate activity the normal procedure, and in some cases the statutory obligation, is that separate accounts should be supplied. The Minister must know that there can never be fair competition between a nationalised industry and a private firm so long as there is not this safeguard. Surely private industry and the taxpayers are entitled to the safeguards which the Amendments provide.

Photo of Sir Douglas Glover Sir Douglas Glover , Ormskirk

I congratulate my hon. Friend the Member for Glasgow. Cathcart (Mr. Edward M. Taylor) first on his elevation to a position which I have never occupied—I am sure that he will finish his career in the House as Secretary of State—and also on the able way in which he has moved the Amendment. He is a man of great personality, with a great past and a great career in front of him in Parliament.

I wish that we could get away from the arid arguments about nationalisation. I do not agree with nationalisation, and history has shown that it has not attracted the public as much as the Labour Government of 1945 thought it would. The public has discovered that it produces almost as many problems as it solves. I am not thinking that we should denationalise the electricity industry, the coalmines or the gas industry. Certain industries are much more eligible for denationalisation.

But that is not the point. The point is that the party opposite seems to think that there is virtue in turning an organisation into a State corporation and then saying that it has none of the evils of free enterprise. That is absolute rubbish. All the penalties of size applying to free enterprise apply doubly to the nationalised industries. Because of the way in which they were nationalised, the boards of the nationalised industries, interested in the reaction of Parliament and so on, are inhibited from adopting a ruthless entrepreneurial line. They are always watching what the papers will say. Any chairman of a nationalised board controlling the whole of one segment of our society would consider that he had far too much on his plate to get involved in minor activities on the side.

The party opposite says that Clauses in recent Bills giving manufacturing powers may never be used; but there is a temptation to the boards to use them. Parliament has given the chairmen and boards the job of running some of the biggest organisations in the country. That should involve the full application of the best brains of the nation without their being involved in an extraneous activity that might give them a profit of £200,000 a year.

I wish the House would forget the idea that a nationalised industry must be given such powers. It is wrong to tempt Lord Robens as he has been tempted—

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

Order. Lord Robens does not come under the National Ports Authority. The hon. Gentleman must relate his remarks to the Amendment.

Photo of Sir Douglas Glover Sir Douglas Glover , Ormskirk

I entirely accept your Ruling, Mr. Speaker, but I think that it is accepted that a Member can use an example, and we are talking about nationalised industries having the power to manufacture—

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

Order. We are talking about one nationalised industry; we are talking about the National Ports Authority.

Photo of Sir Douglas Glover Sir Douglas Glover , Ormskirk

I shall take only a moment, Mr. Speaker. I want to show an example of these powers having been used to the disadvantage of the nation. An old colleague of many of us in the House, Lord Robens, was given those powers. The National Coal Board has gone into manufacturing activities, and in nearly every case he himself would say that they have not been very successful and have turned his and his board's attention from their main job, which is to make the coalmines productive and profitable.

Here we have a new Bill with a new nationalisation problem. The N.P.A. will face many problems. It has a big reorganisation job in front of it. Human beings being what they are, if it is given the power to enter into a commercial activity that it thinks might produce a profit and perhaps balance a loss, it is an awful temptation to go into a sideline. When the N.P.A. presents its report to Parliament it does not want to say, " We have made an awful nonsense and lost £5 million ". If it could save £1 million on outside activities that would seem a jolly good thing, and it would be a great temptation.

If someone were foolish enough to make me chairman of a nationalised board, I should be very tempted in that way if I had the power. Naturally, I should want to present the best picture that I could to Parliament and the nation, and if I had the power to engage in some outside activity which would bring in a profit that would cancel out other losses, it would be a big temptation. However, the probable result would be that, instead of devoting 100 per cent. of my time to getting the ports right, I would devote 80 per cent. of my time to that and the other 20 per cent. to making a profit on that ancillary industry.

Given that Parliament now accepts that there are nationalised industries, if the board of such an industry is given the responsibility of running its organisation on behalf of the nation, it will not be run as a commercial organisation if a loss in one direction is clouded by a profit in another. The nation wants to know whether the ports of Britain are being run efficiently, economically and with foresight to produce the required answers. The nation does not want to know that the authority has made a profit out of producing, say, smokeless fuel. The nation wants to know what is being done about our ports, just as it wants to know what is being done about the coal mines and the electricity industry. The people are not interested in knowing about some other activity which can be done by someone else.

Once a nationalised board has this sort of power, inevitably its mind is turned away from the problem which it has been given as a statutory duty. It takes the easy line of thinking how it can cushion its performance by producing a profit somewhere else. That is the fundamental argument against giving a statutory board this kind of escape hatch. Such a board has enough to do. It is given the job of running an organisation which is far bigger than I.C.I. or any other industrial complex in this country with the possible exception of Shell-Mex and B.P. It has far too much to do in running the main organisation for which it is responsible, and we should not allow it to get off the hook by engaging in other activities.

I am afraid that the party opposite is still hag-ridden with the miasma that Parliament has only to nationalise an industry and all its problems are solved and it will run into an Eldorado of lush living. Of course, we all know that that is rubbish. An industry will have as many problems after nationalisation as it had before, and it will need just as much skill to deal with problems as it did before. We all know that, but you, Mr. Speaker, have to sit here and listen to the ideological arguments across the Floor about nationalization—

Photo of Sir Douglas Glover Sir Douglas Glover , Ormskirk

It was a very tempting subject, because we hear them so often.

If the House decides that a nationalised industry is to have the right to manufacture or engage in certain activities outside its main responsibility, the House has the duty to insist that, when the accounts of the board concerned are presented to Parliament, it can make an assessment of whether the ancillary activity is costing the taxpayer money or making a profit. If the proposed Ports Authority engages in an activity which is not directly part of its main responsibility, it should be laid down by this House that the results of the activity should be shown in separate and clear accounts so that hon. Members can assess them. If we find that the Ports Authority is using the taxpayers' money to run an organisation and is not making a profit, I presume that the Government can remove the power and say, " You will no longer carry on this activity. We will accept the loss that you have incurred and tell you to close it down."

9.30 p.m.

I presume that this would be within the powers of the House. We always say that this place is paramount and can do anything—except turn men into women and women into men. Apart from that it can do anything. But if we pass a Bill which gives a nationalised industry power to carry out activities which, although linked to its main purpose, are subsidiary and ancillary, we should demand that those activities are clearly exposed so that the House can form a judgment upon them.

Amendment No. 19 demands that if the main object is passed, and the National Ports Authority has the power and the right to enter into these slightly outside activities, this House, by law, will lay upon it an obligation to show clearly in each year's accounts, which are brought before the House, the separate activities of the smokeless fuel subsidiary company, the grinding wheel subsidiary company, petrol station, or whatever it is, so that this House can make judgment whether the nationalised industry concerned—in this case the National Ports Authority—is carrying out the duty laid on it to reorganise, manage, and look after our ports and whether its ancillary activities are profitable or loss making.

We have a duty to insist, before the Bill leaves this House, that if we give the National Ports Authority power to undertake manufacturing or other commercial activities they will be shown in its accounts so that the House can form a judgment on them. If the House feels that a mistake has been made tonight it will then have the information and knowledge on which to rescind the powers that it gave.

Mr. Geoffrey Wilson:

I support Amendment No. 12, with proposes that the National Ports Authority shall only engage in activities under Section 48 of the Transport Act, 1968, if an order approving it has been approved by this House.

I served on the Committee which dealt with the Transport Act, 1968. Section 48 of that Act gives wide manufacturing powers to the nationalised industries. I will not repeat all the arguments that were deployed then, but it is an exceptionally wide section. I observed at the time that it was so wide that it was comparable to the powers given to the South Africa Company, which Cecil Rhodes described as giving the South Africa Company power to do everything except to make war. Those are the kind of wide powers proposed in the Bill to be given to the National Ports Authority.

This matter was debated in Committee where it was pointed out that the British Transport Docks Board already had powers of a similar nature. On 5th February I asked the Minister a question to which he was kind enough to give me an answer which did not satisfy the point I wanted to know about. I asked: As a matter of interest, has the British Transport Docks Board as existing made any use of Section 48? It would seem a most redundant provision? The Minister replied: Often when dealing with suppliers one cannot get reasonable terms in a contract, and there is then the possibility that one might manufacture for oneself."—[OFFICIAL REPORT,Standing Committee D, 5th February, 1970; c. 212.] He pointed out that there had been no abuse of these powers and that what had been feared had not materialised.

That is all very well, but to give powers to a nationalised industry simply to wave about as a threat in order to get good terms in a contract seems to me to be going much beyond what is necessary. If manufacturing powers of a wide nature are necessary to the National Ports Authority I should have thought it was reasonable enough for it to come and ask the House of Commons for such powers; and our Amendment proposes just that —that powers should be included in the Bill in the form in which they are in the Transport Act, 1968. That provision would give the nationalised industry power to do absolutely anything, but it should be restricted so that these powers shall not be used until the approval of this House has been sought and given.

It seems to me that that would give the National Ports Authority an opportunity to ask for any particular powers it wanted, and covers the point made by an hon. Gentleman opposite, that in Manchester certain powers are now being used which are of assistance to users of the Port of Manchester. If any particular powers are wanted by any section of the subsidiary of the National Ports Authority, or the authority itself, it is easy enough for application to be made to this House and an order approving the proposal could come before the House. We should then know what we are doing and that we are not giving an open cheque to the nationalised industry to do absolutely anything it likes and to claim that it is doing so under powers under Section 48 of the Transport Act, 1968.

Photo of Mr Sydney Bidwell Mr Sydney Bidwell , Southall

We are here discussing the fundamentals of the Socialist philosophical approach versus the Tory philosophical approach, but not in the absolute terms that the hon. Gentleman who leads on the Front Bench would have us believe, and certainly no one can say that within the ranks of the Labour Movement, as represented on this side of the House, matters were approached in the doctrinaire way suggested by the hon. Member for Ormskirk (Sir D. Glover).

The reality of the situation is that the National Ports Authority is being given the same kind of freedom that other nationalised industries have been given, namely, freedom to exercise manufacturing power should that authority for various reasons decide to do so. As the hon. Gentleman the Member for Glasgow, Cathcart (Mr. Edward M. Taylor) said, nationalised enterprises, owned by the nation and operated on behalf of the nation, are not governed by the same crude commercialism by which private enterprise is governed. That is perfectly true; but neither is private enterprise at this present stage of the development of our complex society governed by quite the same kind of commercial disciplines as governed earlier enterprise in the middle of the last century and the beginning of this.

All kinds of props have always had to be afforded for a very long time to any large-scale enterprise. I have in mind the enterprise referred to, on the side, by the hon. Member for Cathcart, namely, the railway industry of which I have considerable and rich experience in my background. This fits in with the general pattern and what hon. Gentlemen opposite want to do is to fetter this great enterprise.

Mr. Geoffrey Wilson:

If these powers are given to nationalised industries but are not used by them—which is what the Minister told me in Committee—why give them these carte blanche powers? Why not keep these powers in reserve and give them by means of an order when they are asked for?

Photo of Mr Sydney Bidwell Mr Sydney Bidwell , Southall

We have argued these matters in the past and we come down on the side of giving freedom knowing that the composition of these authorities is such and that the people who serve on them are such that they will generally do the right and sensible thing and not run off at a tangent and try to vie with private enterprise when it can be shown that private enterprise is more efficient at doing the job. Rather than deal with it in the piecemeal way suggested by hon. Gentlemen opposite I prefer to deal with this in terms of freedom.

There has been a total contradiction in the ideas advanced by hon. Gentlemen opposite, particularly by the hon. Member far Cathcart. He fears the separate entity of accountability and so on, the side play activity one assumes, of the National Ports Authority. On the one hand, he seemed to be afraid that it might appear too profitable and therefore buttress the overall unprofitability of the nationalised enterprise. On the other hand, he seems to be afraid that it might be not efficient and not too profitable because one cannot use non-profitable activity to buttress non-profitable activity generally. That is the total contradiction of the ideas advanced by the hon. Gentleman.

For those two simple reasons I shall have much pleasure in supporting the Government if they decide to reject the Amendment.

Photo of Mr David Waddington Mr David Waddington , Nelson and Colne

I listened with interest to the arguments advanced by the hon. Member for Southall (Mr. Bidwell). At one stage he suggested that the nationalised industries are not governed by the same crude commercialism as private enterprise. One is inclined to say that perhaps that is the whole trouble, and that that is why they have been such a costly venture for the taxpayer.

The hon. Gentleman wanted to know what our philosophy was. I think that it can be stated in a few words. Hon. Gentlemen opposite are fond of saying that we wish to put every possible obstacle in the way of nationalised industries being profitable. This allegation has been made against us on countless occasions. As one of the taxpayers who have had to suffer numerous blows over recent years, I should be only too happy if the nationalised industries were profitable, and I am certainly not of that school of thought—if there are any in that school of thought—who would happily put— obstacles in the way of the nationalised industries being profitable if they could be profitable.

Our arguments can be stated perfectly simply. First, we are by no means convinced that there is anything in any of the existing nationalisation Acts to ensure fair competition with private industry. We are by no means convinced that in any nationalisation Measure one can secure oneself against the possibility of there being unfair competition by the nationalised industries against private enterprise.

Second, we have never been convinced —and I should be surprised if I did not get support from some hon. Gentlemen opposite for this view—that these enormous public corporations are the sort of bodies which can most efficiently carry out these functions. I agreed wholeheartedly with the remarks of my hon. Friend the Member for Ormskirk (Sir D. Glover). All of us in this House acknowledge the enormous task which lies ahead for the National Ports Authority. It is ridiculous to assume that when the authority has all these important functions to carry out it should be tempted to be diverted into these other paths to carry out activities which can so much better be carried out by other organisations.

9.45 p.m.

When one reads Section 48 of the Transport Act, 1968, one can only be amazed by its comprehensive nature. We must be wary indeed before we give that sort of blanket power to another public corporation without even safeguarding for Members of this House the right to say, in any particular case, that before this extension of powers is used by that nationalised industry the whole matter must be debated in this House, and this House can express a view upon it.

Having listened almost throughout the whole of the day to this Report stage, I have been very surprised at some of the contributions which have been made. I was particularly surprised at the number of times we were told my hon. Members opposite that this Measure was necessary in the interests of the port workers. At the risk of offending the susceptibilities of certain hon. Members opposite, it is necessary to say that the ports really do not exist solely for the edification and delight of the port workers; ports exist for the benefit of the community as a whole.

If in a city such as Manchester one were to speak not to the port workers but the ordinary traders, the people involved in commercial life and local government in that city—ordinary men and women—most of them would say either they did not know what this Bill was about at all or that they certainly did not want another nationalisation measure.

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

Order. That may or may not be true, but the hon. Gentleman must come to the Amendment.

Photo of Mr David Waddington Mr David Waddington , Nelson and Colne

I certainly will, Mr. Speaker.

In conclusion, if one were then to say to those same people that not only was a new monolithic nationalised corporation to be set up but that that corporation would be allowed to indulge in any sort of manufacturing activity and any type of activity which is carried out by the people of Manchester, then indeed they would throw up, their hands in horror and wonder what on earth we were doing in this House today.

Even if the Government are not prepared to accept an Amendment which would force any extension of manufacturing powers to be discussed in this House, I urge the Minister seriously to consider the other Amendment on the Notice Paper, which would mean that the ordinary member of the public would have a chance of seeing whether or not manufacturing activities to be carried out by this nationalised corporation were profitable and in the interests of the taxpayers.

Photo of Mr Charles Doughty Mr Charles Doughty , East Surrey

I do not wish to detain the House from hearing what the Minister has to say on this very important subject but there is a tendency which has crept into modern nationalisation Bills which is to be highly regretted. When we are considering the nationalisation of a particular industry—in principle, of course, I am opposed to it, in the same way as I am opposed to this Bill—the Government suddenly come forward and say that they wish to indulge in any kind of activity they think fit. It was only a short time ago that this House, despite the opposition of the Conservative Party, gave leave to the Gas Council to indulge in exploration in the North Sea and other places. That was a highly speculative occupation, but, with public funds behind it, the Gas Council are entitled so to do. That is one example.

What is the purpose of giving the National Ports Authority, if it ever comes into existence, the power to indulge in any activity it thinks fit? It can only result in more of the losses which are practically always associated with nationalised industries. The railways have cost us enormous amounts of money, yet they are allowed to manufacture their own articles. Whether they have done so or not is irrelevant—we have given them the power.

Now, the National Ports Authority will have the same power. We are not told what it will manufacture. If it is to have this power it should say, "To carry out our duties under the Bill, we should be able to do so and so". The House would be able to say whether it approved of that or not. Will it manufacture ships or tugs, wharves or dams? We do not know.

Photo of Mr Charles Mapp Mr Charles Mapp , Oldham East

Why should it not manufacture tugs? In the Mersey Estuary it is part of the undertaking of both port authorities. One cannot turn a port around without tugs or all sorts of services. It is no good being hyperbolic about this. The authority will want tugs, and if it cannot buy them competitively, it will have to build them itself. It is as simple as that.

Photo of Mr Charles Doughty Mr Charles Doughty , East Surrey

It is not as simple as that. That is exactly the danger which is creeping into the Bill. The authority does not own tug docks to build them in and would have to acquire them by purchase or construction. Shipbuilding is highly competitive, and many private firms, too, have lost money. If the N.P.A. goes in with public money to manufacture tugs and ships, the House will have to pay. That is why the authority should explain its reasons, or it should present its accounts to the House so that we can know how much money it is losing by entering a highly competitive industry which is much better done by private enterprise.

I am obliged for that intervention, which emphasises what I have been trying for so long to say. Much as I should like to say more about this proposal, I will leave the Minister to explain it away if he can.

Photo of Mr Fred Mulley Mr Fred Mulley , Sheffield Park

It is a little difficult to reconcile the remarks of the hon. and learned member for Surrey, East (Mr. Doughty)with those of his hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor), who had come a little way and said that the party opposite were not opposing the principle of nationalised industries being able to manufacture and carry out other activities for outside firms. But the hon. and learned Member is an unrepentant, old-fashioned Tory and against anything like this. I am surprised, because I had always thought that the hon. Member for Cathcart prided himself on being to the extreme right of his party. But I will not get involved in these party differences.

Mr. Edward M. Taylor:

The Minister will agree that I said that I had moved an Amendment to take out the manufacturing powers in Committee, that it was an Amendment which we believed in and supported and voted on but that, because I thought we might have more chance of getting the Minister to accept this Amendment, we had put it down as a reasonable compromise.

Photo of Mr Fred Mulley Mr Fred Mulley , Sheffield Park

I have always had a high opinion of the hon. Member's abilities, and I was hoping that he had learned and profited from the 100 hours we spent together in Committee, but I was wrong, apparently.

The issue is simple. The other powers granted to the whole range of transport industries by the then Minister in the Transport Act of 1968 have been widely recognised as progressive, farsighted and extremely successful. There have been no instances of irresponsible use, as were widely forecast when that Bill was in Committee. The industries concerned have been very responsible and have exercised those powers, as that Act and this Bill lay down, on a commercial basis. Indeed, the hon. Member for Truro (Mr. Geoffrey Wilson) said, rather critically I thought, that the British Transport Docks Board has not set up any large manufacturinig concerns. garages and so on. I thought he was rather critical that it had not done this.

We may have arguments about aspects of the Bill—but I would not have thought that anyone would seriously contend that the Ports Bill was not also connected with transport, and I can see no reason why the N.P.A. should not have the same powers and responsibilities as the other transport bodies. Indeed, the ports which will come into the National Ports Authority from the British Transport Docks Board have these powers now.

The point is simple. It is intended to put the ports not on any more favoured basis but on exactly the same basis as a public or private company under the Companies Act. The hon. Member for Truro rather disappointed me because I know that he is very experienced in these matters and has the advantage of a long legal career. He knows perfectly well that when a company is set up, its memorandum and articles do not confine the powers which it is seeking to the particular business which it expects to enter into. For practically any company the powers are wide enough to enable it to manufacture aspirins at one end of the alphabet or open a zoo at the other. There is no reason at all why we should not give the public bodies which have a responsibility to Parliament the same powers as are given day by day, practically with no scrutiny, to any private company which is set up.

Mr. Geoffrey Wilson:

I referred to the South Africa company with the observation that its articles of association are so wide that it can do practically anything but make war. I thought that we were going as far as that with the nationalised industries and rather farther than that with public companies.

Photo of Mr Fred Mulley Mr Fred Mulley , Sheffield Park

I do not advocate making war either by public or by private companies, but it is right that these powers should be given and that they should be exercised responsibly.

The general approval of the Minister is required under Clause 48. We have had a great song and dance tonight about the activities of the Railways Board which flow from similar provisions in previous legislation. On 8th December I approved and reported to Parliament the proposals of the Railways Board under Section 48(4) of the Transport Act, 1968. Copies of those approved proposals were placed in the Vote Office, a Press notice was issued and copies were sent to both the C.B.I. and the T.U.C. as required by the Act. So far I have heard of nobody criticising those proposals.

There is no evidence that the existing procedures are in any way unsatisfactory. At Question Time today I said that I was at the carriage and locomotive works of British Railways in Derby 10 days ago and was extremely impressed at the way in which they have gained a wide range of work in competition with private firms. Private firms only really complain because in many cases they are losing orders in competitive tenders because the railway workshops are able to do the job better and more efficiently than some of the private firms.

The only proposition I make is that the competition should be fair. This is in the Bill, but it must be a both-ways arrangement. As in the case of British Railways, it may be appropriate for the National Ports Authority to set up a private company under the Companies Acts to conduct these arrangements. If it does I think it is only right that it should be subject to the same rules and regulations as other companies under the Companies Acts. At the same time, it should not be forced to come to the House or anywhere else for extra permissions or to give information about activities which could well be to its commercial disadvantage. That is not a duty laid upon companies under the Companies Acts.

10.0 p.m.

It is ridiculous to suggest that the House should discuss every single case in which a transport undertaking which is publicly owned wants to use or extend its ability under the Clause in manufacture, repair or supply. I have already made it clear that it is quite wrong that a Minister should seek directly or indirectly to run a nationalised industry, and it would be even more ridiculous to ask this House, with its very full timetable, to give serious scrutiny to all the detailed operations which these boards may have to undertake or which they have the opportunity of undertaking for outside interests.

In any case, some of these opportunities may arise at very short notice. For example, a board may be able to use its dredging equipment for another port and it may be important to be able to make a decision very quickly. The same applies to repair functions. It would be a ludicrous situation if a board had to get an order from the House of Commons before it could use a repair facility it may have been asked for and which was not being fully utilised at the time. The whole proposal is too silly to stand examination.

While the hon. Member for Truro may have thought that I might be more persuaded by these arguments, I regard the Amendments as another attempt to fetter the nationalised industries and to make it difficult for them to compete. They would take away from these industries the power every ordinary company has under the Companies Acts to engage in work which they find convenient to undertake. Equally silly is the idea that these boards should have to set up a subsidary company for each separate activity.

It is well accepted that the day-to-day management of the ports should be exercised not by the National Ports Authority itself but by the individual boards. These Amendments would mean having to have a separate company for each of the port boards if occasionally it did a little repair work or other work for outside interests. Amendment No. 21, which would impose a special form of accounts, would mean undesirable rigidity and complexity in the accounts. Copies of subsidiary companies' reports and accounts, as is the usual practice with other nationalised transport undertakings, will be placed in the Library of the House and, like the other public companies' records, will be available for perusal at the companies registry.

It is right, as my hon. Friend the Member for Southall (Mr. Bidwell) speaking with his considerable experience stated, that the nationalised industries should have the same rights and duties and be accountable in the same way as companies in the private sector, and should be allowed, if it is to their advantage, to manufacture and sell to persons outside on behalf of their own industries. I cannot recommend any of the Amendments because they are designed to fetter the free, independent operation of our national enterprises.

Photo of Mr John Peyton Mr John Peyton , Yeovil

I came into the Chamber to listen to the right hon. Gentleman defending himself against what seemed to me to be a reasonable Amendment. He concluded his remarks by expressing the sentiments that the same rights and duties should be conferred on nationalised enterprises as are enjoyed by private ones. I assure him that there are many private enterprise concerns which wish devoutly that they could have conferred on them the same privileges as are now enjoyed by public concerns.

The right hon. Gentleman thought it right these these powers should be given to nationalised industries and that they should be exercised responsibly. What assurance do we have that they will be exercised responsibly and that the privileges being conferred are not too great and do not include rights which exempt them from effective competition?

The right hon. Gentleman took some comfort from the fact that notices had been served on the T.U.C. and C.B.I. and that no objection had been taken. When will Ministers and officials learn that the mere fact that people have an opportunity to offer objection to obnoxious practices is not in itself effective because people are tired of making objections and finding their exercise fruitless?

In a moment of candour, the right hon. Gentleman admitted that it is wrong for a Minister to seek to run a nationalised industry. He endeavoured to explain that it was even worse that this House should seek to supervise the affairs of such an industry.

Photo of Mr Fred Mulley Mr Fred Mulley , Sheffield Park

I did not say that one should seek to supervise. I referred to the exercise of what would amount to the detailed scrutiny of an undertaking such as that suggested in the Amendment. I was referring, in other words, to management and not to supervision.

Photo of Mr John Peyton Mr John Peyton , Yeovil

Even a crippled House of Commons—one that has become as much a plaything of the Executive as this one has—is deeply concerned with the way in which the nationalised industries are run. I am sure that none of my hon. Friends on the Opposition Front Bench would presume to say that they could or should run these industries.

We are challenging the ability of Ministers to undertake this exercise. If Ministers cannot do it, who can? To whom will these people be responsible? These are the eternal questions of nationalised industries which remain unanswered. The right hon. Gentleman knows this but he has not answered them tonight. I challenge him to give one example of a nationalised industry that has not enjoyed privileges unknown to private enterprise. Will he speak of one nationalised industry that is able to show a record of satisfaction to its customers? Let him say, at the end of the day, how comfortable are those wretched people who are condemned to travel at nine o'clock on public transport.

Photo of Hon. Anthony Berry Hon. Anthony Berry , Southgate

I hoped at one time that the Minister would give us some new or convincing reasons for opposing these Amendments. I even thought that he might accept them. When he began by trying to show, rather unsuccessfully, that my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor) has slightly different views from those of my hon. and learned Friend the Member for Surrey, East (Mr. Doughty), I realised that he was trying to cloud the issues by making unsuccessful fun at our expense. He soon saw that that had no effect at all.

The right hon. Gentleman said that he could see no reason for our opposition to the suggestions in this part of the Bill. He must surely know, after the many debates in Committee, how strongly we oppose this suggestion and seek in a small way to make this bad Bill a little less bad. When he tried to hide the issue by talking about dredging and repairs, which anyway are provided for in the Bill through the powers of the superseded authorities, he was dodging the issue, which is why we have in this nationalisation Measure the same blanketing powers we have had year after year each time this Government have

brought in yet one more of these appalling Bills.

In the 1968 Act there were powers to manufacture and supply by the British Waterways Board, which could not possibly wish to use such powers. Last year we had a somewhat better Bill, the Transport (London) Bill, but there again London Transport was given powers which I am sure it did not want. The same mistake is being made with a further extension of such powers. Why should the National Ports Authority have power to run garages and petrol stations, as it will have under this Bill?

When the right hon. Gentleman talks about freedom he should say at whose expense the authority will do these things. I prefer the views of my hon. Friend the Member for Nelson and Colne (Mr. Waddington), who was not in the House at the time of the passing of the 1968 Act, but who is here now largely because of the feelings in the country about that Act, not least in the great County of Lancashire. The National Ports Authority will have great powers which, if it is to do well—obviously we hope the ports industry will prosper under the authority although we do not like what is being done—it must concentrate on its own business. It will have a vast amount of work to do and I do not think it will want these powers.

We are trying to make this bad Bill a little less bad. The National Ports Authority must be able to get on with the work it has to do in running the ports business. That is why we think it wholly wrong for the authority to have these extra powers which, willy-nilly, the Government put into every nationalisation Measure. We seek to restore Parliamentary control. I advise my hon. Friends to vote in favour of this Amendment.

Question put, That the Amendment be made:—

The House divided: Ayes, 172, Noes 251.

Division [No. 109.]AYES[10.13] p.m.
Alison, Michael (Barkston Ash)Beamish, Col. Sir TuftonBlaker, Peter
Allason, James (Hemel Hempstead)Bell, RonaldBoardman, Tom (Leicester, S.W.)
Archer, Jeffrey (Louth)Bennett, Sir Frederic (Torquay)Bossom, Sir Clive
Atkins, Humphrey (M't'n & M'd'n)Bennett, Dr. Reginald (Gos. & Fhm)Boyd-Carpenter, Rt.Hn. John
Awdry, DanielBerry, Hn. AnthonyBrewis, John
Baker, Kenneth (Acton)Biffen, JohnBrinton, Sir Tatton
Baker, W. H. K. (Banff)Birch, Rt. Hn. NigelBruce-Gardyne, J.
Barber, Rt. Hn. AnthonyBlack, Sir CyrilBryan, Paul
Buchanan-Smith, Alick(Angus, N & M)Hogg, Rt. Hn. QuintinPeyton, John
Buck, Antony (Colchester)Holland, PhilipPike, Miss Mervyn
Burden, F. A.Hordern, PeterPounder, Rafton
Campbell, B. (Oldham, W.)Hornby, RichardPowell, Rt. Hn. J. Enoch
Campbell, Gordon (Moray & Nairn)Hunt, JohnPrice, David (Eastleigh)
Chichester-Clark, R.Hutchison, Michael ClarkPym, Francis
Clark, HenryIremonger, T. L.Renton, Rt. Hn. Sir David
Cooke, RobertIrvine, Bryant Godman (Rye)Ridley, Hn. Nicholas
Cooper-Key, Sir NeillJenkin, Patrick (Woodford)Ridsdale, Julian
Cordle, JohnJennings, J. C. (Burton)Rossi, Hugh (Hornsey)
Costain, A. P.Johnson Smith, G. (E. Grinstead)St. John-Stevas, Norman
Crouch, DavidJones, Arthur (Northants, S.)Scott, Nicholas
Crowder, F. P.Jopling, MichaelScott-Hopkins, James
Cunningham, Sir KnoxJoseph, Rt. Hn. Sir KeithSharpies, Richard
Currie, G. B. H.King, Evelyn (Dorset, S.)Shaw, Michael (Sc'b'gh & Whitby)
Dalkeith, Earl ofKing, TomSinclair, Sir George
Dance, JamesKirk, PeterSmith, Dudley (W'wick & L'mington)
Dean, PaulKitson, TimothySmith, John (London & W'minster)
Deedes, Rt. Hn. W. F. (Ashford)Knight, Mrs. JillSpeed, Keith
Dodds-Parker, DouglasLambton, AntonyStainton, Keith
Doughty, CharlesLancaster, Col. C. GStodart, Anthony
Drayson, G.B Lane, DavidStoddart-Scott, Col. Sir M.
du Cann, Rt Hn EdwareLangford-Holt, Sir JohnTapsell, Peter
Elliott, R. W. (N'c'tle-upon-Tyne, N.)Legge-Bourke, Sir HarryTaylor, Sir Charles (Eastbourne)
Emery, PeterLloyd, Ian (P'tsm'th, Langstone)Taylor, Edward M.(G'gow, Cathcart)
Errington, Sir EricMcMaster, StanleyTemple, John M.
Eyre, ReginaldMacmillan, Maur'ce (Farnham)Thatcher, Mrs. Margaret
Farr, JohnMcNair-Wilson, MichaelTilney, John
Fletcher-Cooke, CharlesMcNair-Wilson, Patrick (New Forest)Turton, Rt. Hn. R. H.
Fortescue, TimMaginnis, John E.van Straubenzee, W. R.
Foster, Sir JohnMaude, AngusVickers, Dame Joan
Fry, PeterMawby, RayWaddington, David
Galbraith, Hn. T. G.Maxwell-Hyslop, R. J.Walker-Smith, Rt. Hn. Sir Derek
Gilmour, Ian (Norfolk, C.)Maydon, Lt.-Cmdr. S. L. C.Wall, Patrick
Gilmour, Sir John (Fife, E.)Mills, Peter (Torrington)Walters, Dennis
Glover, Sir DouglasMiscampbell, NormanWard, Christopher (Swindon)
Goodnart, PhilipMontgomery, FergusWard, Dame Irene
Gower, RaymondMore, JasperWells, John (Maidstone)
Grant, AnthonyMorgan, Geralnt (Denbigh)Whitelaw, Rt. Hn. William
Grieve, PercyMorrison, Charles (Devizes)Williams, Donald (Dudley)
Gurden, HaroldMott-Radclyffe, Sir CharlesWilson, Geoffrey (Truro)
Had, John (Wycombe)Munro-Lucas-Tooth, Sir HughWolrige-Gordon, Patrick
Hall-Davis, A. G. F.Murton, OscarWoodnutt, Mark
Hamilton, Michael (Salisbury)Nabarro, Sir GeraldWorsley, Marcus
Harrison, Brian (Maldon)Neave, AlreyWright, Esmond
Harrison, Col. Sir Harwood (Eye)Nlcholls, Sir HarmarYounger, Hn. George
Hawkins, PaulNoble, Rt. Hn. Michael
Heald, Rt. Hn. Sir LionelOnslow, CranleyTELLERS FOR THE AYES:
Heseltine, MichaelPearson, Sir Frank (Clitheroe)Mr. Walter Clegg and
Hiley, JosephPeel, JohnMr. Hector Monro.
Hill, J. E. B.
Hirst, Geoffrey
Albu, AustenBrown,Bob (N'c'tle-upon-Tyne, W.)Dell, Rt. Hn. Edmund
Allaun, Frank (Salford, E.)Brown, R. W. (Shoreditch & F'bury)Dewar, Donald
Alldritt, WalterBuchan, NormanDiamond, Rt. Hn. John
Allen, ScholefieldBuchanan, Richard (G'gow, Sp'burn)Doig, Peter
Anderson, DonaldButler, Mrs. Joyce (Wood Green)Driberg, Tom
Archer, Peter (R'wley Regis & Tipt'n)Cant, R. B.Dunn, James A.
Armstrong, ErnestCarmichael, NeilEadle, Alex
Ashley, JackCastle, Rt. Hn. BarbaraEdelman, Maurice
Atkins, Ronald (Preston, N.)Chapman, DonaldEllis, John
Atkinson, Norman (Tottenham)Coe, DenisEnglish, Michael
Bacon, Rt. Hn. AliceColeman, DonaldEnnals, David
Bagier, Gordon A. TConcannon, J. D.Evans, loan L. (Birm'h'm, Yardley)
Barnett, JoelConlan, BernardFinch, Harold
Baxter, WilliamCraddock, George (Bradford, S)Fletcher, Raymond (Ilkeston)
Beaney, AlanCrawshaw, RichardFoley, Maurice
Bence, CyrilCronin, JohnFoot, Michael (Ebbw Vale)
Benn, Rt. Hn. Anthony WedgwoodCrosland, Rt. Hn. AnthonyFord, Ben
Bennett, James (G'gow, Bridgeton)Crossman, Rt. Hn. RichardForrester, John
Bidwcll, SydneyDalyell, TamFowler, Gerry
Binns, JohnDarling, Rt. Hn. GeorgeFraser, John (Norwood)
Bishop, E. S.Davidson, Arthur (Accrington)Galpern, Sir Myer
Blackburn, F.Davidson, James(Aberdeenshire, W.)Garrett, W. E.
Booth, AlbertDavies, E. Hudson (Conway)Ginsburg, David
Boston, TerenceDavies, G. Elfed (Rhondda, E.)Golding, John
Bottomley, Rt. Hn, ArthurDavies, Dr. Ernest (Stretford)Gordon Walker, Rt. Hn. P. C.
Boyden, JamesDavies, Rt. Hn. Harold (Leek)Gray, Dr. Hugh (Yarmouth)
Bradley, TomDavies, I for (Gower)Greenwood, Rt. Hn. Anthony
Bray, Dr. JeremyDavies, S. O. (Merthyr)Gregory, Arnold
Brown, Rt. Hn. George (Belper)de Freltas, Rt. Hn. Sir GeoffreyGrey, Charles (Durham)
Brown, Hugh D. (G'gow, Provan)Delargy, H. J Griffiths, Eddie (Brightside)
Griffiths, Will (Exchange)Macdonald, A. H.Price, William (Rugby)
Grimond, Rt. Hn. J.McElhone, FrankProbert, Arthur
Gunter, Rt. Hn. R. J.McGuire, MichaelRandall, Harry
Hamilton, James (Bothwell)McKay, Mrs. MargaretRankin, John
Hamilton, William (Fife, W.)Mackenzie, Alasdair(Ross & Crom'ty)Rees, Merlyn
Hannan, WilliamMackenzie, Gregor (Rutherglen)Rhodes, Geoffrey
Harper, JosephMackie, JohnRoberts, Rt. Hn, Goronwy
Harrison, Walter (Wakefield)Mackintosh, John P.Roberts, Gwilym (Bedfordshire, S.)
Hart, Rt. Hn. JudithMaclennan, RobertRobertson, John (Paisley)
Haseldine, NormanMcMillan, Tom (Glasgow, C.)Robinson, Rt Hn Kenneth(St. P'c' as)
Hattersley, RoyMacPherson, MalcolmRodgers, William(Stockton)
Hazell, BertMahon, Peter (Preston, S.)Rose, Paul
Heffer, Eric S.Mahon, Simon (Bootle)Ross, Rt. Hn. William
Henig, StanleyMallalieu, E. L. (Brigg)Rowlands, E.
Herbison, Rt. Hn. MargaretMallalieu, J.P.W.(Huddersfield, E.)Sheldon, Robert
Hilton, W. S.Mapp, CharlesShore, Rt. Hn. Peter (Stepney)
Hobden, DennisMarquand, DavidSillars, J.
Hooley, FrankMason, Rt. Hn. RoySilverman, Julius
Homer, JohnMellish, Rt. Hn. RobertSlater, Joseph
Houghton, Rt. Hn. DouglasMendelson, JohnSmall, William
Howarth, Robert (Bolton, E.)Mikardo, lanSnow, Julian
Howie, W.Millan, BruceSpriggs, Leslie
Hoy, Rt. Hn. JamesMiller, Dr. M. S.Steel David (Roxburgh)
Hughes, Rt. Hn. Cledwyn (Anglesey)Mitchell, R. C. (S'th'pton, Test)Steele, Thomas (Dunbartonshire, W.)
Hughes, Hector (Aberdeen, N.)Moonman, EricStonehouse, Rt. Hn. John
Hughes, Roy (Newport)Morgan, Elystan (Cardiganshire)Summerskill, Hn. Dr. Shirley
Hunter, AdamMorris, Alfred (Wythenshawe)Swain, Thomas
Hynd, JohnMorris, Charles R. (Openshaw)Taverne, Dick
Irvine, Rt. Hn. Sir ArthurMorris, John (Aberavon)Thornton, Ernest
Jackson, Colin (B'h'se & Spenb'gh)Mulley, Rt. Hn. FrederickTinn, James
Janner, Sir BarnettMurray, AlbertTomney, Frank
Jeger, Mrs.Lena(H'b'n & St.P'cras, S.)Neal, HaroldWainwright, Richard (Coins Valley)
Jenkins, Hugh (Putney)Newens, StanWalden, Brian (All Saints)
Johnson, James (K'ston-on-Hull, W.)Oakes, GordonWalker, Harold (Doncaster)
Jones, Dan (Burnley)Ogden, EricWallace, George
Jones, T. Alec (Rhondda, West)O'Halloran, MichaelWatkins, Tudor (Brecon & Radnor)
Judd, FrankO'Malley, BrianWeitzman, David
Kenyon, CliffordOram, BertWellbeloved, James
Kerr, Mrs. Anne (R'ter & Chatham)Orbach, MauriceWhitaker, Ben
Kerr, Dr. David (W'worth, Central)Orme, StanleyWhite, Mrs. Eirene
Kerr, Russell (Feltham)Oswald, ThomasWhitlock, William
Latham, ArthurPage, Derek (King's Lynn)Wilkins, W. A.
Lawson, GeorgePaget, R. T.Williams, Alan Lee (Hornchurch)
Leadbitter, TedPalmer, ArthurWilliams, Clifford (Abertillery)
Lee, Rt. Hn. Frederick (Newton)Panned, Rt. Hn. CharlesWillis, Rt. Hn. George
Lever, Rt. Hn. Harold (Cheetham)Pardoe, JohnWilson, William (Coventry, S.)
Lewis, Arthur (W. Ham, N.)Parker, John (Dagenham)Winnick, David
Lewis, Ron (Carlisle)Parkyn, Brian (Bedford)Winstanley, Dr. M, P.
Lomas, KennethPavitt, LaurenceWoodburn, Rt. Hn. A.
Loughlin, CharlesPearson, Arthur (Pontypridd)Woof, Robert
Lubbock, EricPeart, Rt. Hn. FredWyatt, Woodrow
Lyons, Edward (Bradford, E.)Pentland, Norman
Mabon Dr. J. DicksonPerry, Ernest G. (Battersea, S.)TELLERS FOR THE NOES:
McCann, JohnPerry, George H. (Nottingham, S.)Mr. R F. H. Dobson and
MacColl, JamesPrice, Christopher (Perry Barr)Mr. Neil McBride.