Orders of the Day — Transport Bill

Part of the debate – in the House of Commons at 9:01 pm on 13th January 1981.

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Photo of John Prescott John Prescott , Kingston upon Hull East 9:01 pm, 13th January 1981

We have had a debate of considerable interest on highly controversial matters. Like many other hon. Members I feel that it would have been better for the road safety provisions to have been contained in a separate Bill, and that applies particularly to the breathalyser and discretionary powers which may divide the two sides of the House. We welcome the fact that action is to be taken on road safety now rather than being delayed, and that factor should perhaps be taken into account.

I declare an interest. I was a seafarer for 10 years and a member of the National Union of Seamen. I have served in hotels, worked on docks and served on ships. I therefore have a reasonable amount of experience of working in the industries covered by the Bill.

I felt that in introducing the Bill the Secretary of State was whistling into the wind when he claimed the credit for the last Transport Bill. On the news tonight we were told of further redundancies in the transport industry and reductions in services. Many of us feel that we are witnessing the destruction of the public bus system. The right hon. Gentleman is now turning his attention to the public rail and ports transport industries. Many of us feel that they will now suffer from the same policy, which is to undermine the public sector to the direct benefit of the private sector.

Before moving on to welcome parts of the Bill, I congratulate the Secretary of State on his appointment to the Cabinet. Perhaps the policies that he has been pursuing have convinced the Prime Minister that they are the sort of Tory policies that she wants. They are, however, those that we find the most controversial. We wait with interest to see whether the right hon. Gentleman will join the wets or the others in the Cabinet debates.

We welcome the Bill's contribution towards improving road safety, and we agree with the need for them. We welcome, too, the attempt to deal with the carnage among motor cyclists, many of them youngsters—we have heard about 1,000 deaths—and we hope that it will bring some improvement.

We support the proposals for a totting—up system for traffic offences. However, there is concern about the points allocated for particular offences and about the proposal to wipe the slate clean in regard to certain discretionary disqualifications. A policeman has suggested to me that the incentive in the points system is for an offender to get off home after an accident without reporting it. That would incur a penalty of six points. By doing that, however, the motorist who causes injury while drunk avoids a possible disqualification. Those are points which no doubt we shall have an opportunity to discuss in Committee, as the Secretary of State has said.

The more controversial matter to which the House has given attention tonight and on other occasions is the one concerned with discretion power for drink-driving offences which is not in the Bill but which may end up in the Bill. The controversy ranges across both sides of the House.

The previous Labour Minister of Transport put forward to the then Cabinet the recommendations of Blennerhassett. The hon. Member for Essex, South-East (Sir B. Braine) asked why the Labour Government had not implemented those recommendations. That is another indication of the controversy on implementation involved in this policy.

We welcome the recommendations of Blennerhassett which have been included in the Bill, which will improve the law on drink and driving. However, I have been convinced for a while, particularly after recently reading Blennerhassett, that there is a strong argument on grounds of deterrence for further actions to be taken over the granting of the power of discretion.

The Secretary of State said that we should pay attention to what Barbara Castle said, when she was Minister, in introducing her drink-driving legislation without discretionary powers. She was concerned about relations with the police and about public acceptance. I argue that public attitudes have changed a great deal since 1967. The polls suggest that the majority of people favour the introduction of discretionary powers in this area. Moreover, drink consumption has increased.

The reality, as pointed out by a number of hon. Members, is that there has been an increasing number of deaths due to driving with a level of alcohol higher than that allowed in the Bill and that these deaths occur at certain times of the day. Over 1,200 drivers have been killed because of drunken driving.

There will be a discussion in Committee on this matter, but I should like to put it on record that I believe that discretionary powers are already being used in this area although they are intended for other purposes. For example, the chief constable of Warwickshire has made it clear that during random inspection of such things as car transport offences or insurance certificates, such traffic legislation has provided the opportunity to observe whether a driver is affected by drink.

Therefore, as random testing is beginning to be used to detect drunken drivers, the House should make up its mind whether this is a power which it is prepared to give to the police authorities. If so, it should consider what conditions and rules should govern its application. I hope that in Committee we shall have the opportunity to develop that argument and that eventually the House will decide on that controversial matter.

I will concentrate my remarks on port policy. My right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) dealt with many of the arguments about railway subsidiaries. The Bill has a number of controversial elements in major areas of transport policy.

The abolition of the National Ports Council and the privatisation of the British Transport Docks Board will be important developments in port policy. The justification given by the Secretary of State for that action is that he feels that there should be less Government intervention in this area and that the private industry and market forces should determine the structure of our port industry dictated by the commercial decisions. He did not feel that the ports were public utilities and considered that they were best left for their potentianal development to forces other than the State.

That flies in the face of a great deal of evidence in the industry and of the major analysis done in 1962 by the Rochdale committee, which was set up by a Conservative Government. It flies in the face of the conclusions of that committee and of the evidence of recent events, which show the trend of port policy over the next few years. Rochdale made it absolutely clear that the industry then had an excessive amount of obsolete investment and concluded that the best way of reorganising it was to establish a national ports authority.

The Secretary of State must understand why Rochdale reached that conclusion. The committee considered the various private interests represented in the Docks and Harbour Authorities Association, which had had a considerable influence on port development up to that time and concluded that it had completely failed in its obligation to develop a modern port industry. That convinced the committee of the need for a national ports authority with the power to develop, reorganise and modernise and to channel investment where it was so badly needed.

That proposal was opposed by the private sector, and, when considering the recommendations in 1962 or 1963, the Government bowed to that pressure and refused to establish a national ports authority. Instead, it set up the National Ports Council, which was given only powers of advice plus certain statutory functions.

Like the Secretary of State and others, I congratulate the council on its work over the last 15 years. It has done a great deal of analysis and research and has played an important part in development and modernisation. However, it has not had the authority to influence the industry's structure, because its role has largely been that of advising the Minister.

The Labour Party has always believed that a national ports authority was essential. Just before the Secretary of State came to the House in 1970, the Labour Government had tried to pass a Bill which contained provisions for such an authority. We have advocated that policy ever since, so our record is consistent.

I have not necessarily agreed with all the judgments of the council—nor have a number of the unions involved, particularly the TGWU. For example, I disagreed with its decision to support further expansion of containerisation at Felixstowe. That led to a £24 million development, and there is now excess capacity for containerisation in that port. Indeed, we are beginning to see over—investment in a number of ports. That is one of the problems to which the Rochdale committee addressed itself.

The development of small wharves created many political problems in 1972, 1973 and 1974. The council did not point out strongly enough to the Minister the impossibility of large ports with huge investment programmes—much of the money coming from the taxpayer—being able to compete with small wharves with little capital investment. I therefore disagreed with the council's judgment on that matter.

We are told in Department handouts that the reasons for doing away with the National Ports Council are that it will save money, that there will be less intervention and that the ports themselves can handle the council's functions.

On the first of those reasons, the levy is £1·2 million on a £500 million turnover—which works out at about 0·22p on every pound. That is a small price to pay for the research and development statistics that the council has been providing for the industry. It has a high reputation abroad, its publications are in great demand and its advice has been given not only in Britain but in other countries. The industry will not continue all its work.

The Secretary of State's second argument for abolition is that there will be less intervention. I understand that he intends to abolish some statutory powers—some of which were never used and one of which was last used in 1971. Powers relating to appeals by docks over dues and to investment over £1 million, for example, will be transferred to his Department, although he can take investment decisions already, on the advice of the council. As I understand it, he will have to increase the number of civil servants in the Department, probably by about six, in addition to the ports director. Certainly, the more difficult aspect of this development is the loss of independent assessment by an independent body of the various port problems that arise directly out of investment when a Minister has to consider various schemes for investments of over £1 million. The Minister would be denied the expertise and appraisal by the National Ports Council. That body was used by the Conservative Government in 1972 to bring about a solution to the problem of the small wharves. Indeed, the Secretary of State used the National Ports Council even after announcing its abolition. He used it to examine the finance problems in the Liverpool ports. That in itself is a recognition of the role that the council can play.

There is an interesting difference between the role that the Secretary of State will have under the Bill and the role that he has at present. It could be argued that he has the responsibility for directing the British Transport Docks Board at present. He certainly has the power, although various Ministers in different Governments have always advocated that they will not interfere in the day-to-day management of the companies. They have largely been left with a free hand. Now, any investment by a port that may not belong to the British Transport Docks Board will force the Secretary of State to make a decision on whether the investment is acceptable or on whether he will allow further containerisation in one port. If he looks at the case of Felixstowe he will see that the BTDB is against such a development. Now, he will have a 51 per cent. share in the docks board, but at the same time he will have to make a decision about the containerisation development of another competing port interest. That will not lead people to be confident that the Secretary of State will make impartial judgments. That will lead to further difficulties, certainly when a Tory Minister is making the decisions.

Tory Party policy on ports has tended to result in a dash for the market place. A good example of that was the Mersey Docks and Harbour Board in 1971, when Selsdon man was rampant. That company was allowed to go bankrupt, and we heard a lot about widows losing their money. But within two years the Government had to bring forward another Bill promising finance to all other such port authorities because of the damage they had done by allowing the collapse and bankruptcy of the Mersey Docks and Harbour Board—as well as losing much money themselves. But now we are at it again. There is a dash for the market place. The Tories are killing off the nationalised industries, and closing down a key independent body that can give advice, even though it was established by a previous Tory Government.

The Minister cannot stand aside from intervention in port policy. It is not possible for him to get rid of the assets and assume that he will not be involved in the development of port policy. I warn him now to look at what is happening in the ports. There is a financial crisis in heavily subsidised London, Bristol and Liverpool, and one developing in Manchester and in other estuarial areas, due to the declining traffic and a switch of traffic from the West of the country to the East, resulting in surplus labour in areas with high severance costs. There will be a financial crisis in which he will be involved.

When we debated the Port of London (Financial Assistance) Bill 1980 the Minister said that he was not really intervening in the activities of the Port of London Authority because there had been a commitment by the Labour Government. Yet when hon. Members representing Merseyside and Liverpool constituencies said that the problem was the same there and asked for extra help, he said that he would not intervene. A written answer in December made it clear that he has already extended the right to borrow more. He may now find that what may affect anyone wishing to purchase shares in the British Transport Docks Board is the fact that he will be propping up so many other ports—for good reason; we shall probably support him in that exercise—and that will affect the BTDB and its share price. We shall have to see whether that happens, but those considerations are on the horizon and must be taken into account.

The Minister concluded in his press statement on the abolition of the National Ports Council that The Council should be wound up, and that the responsibility for the efficiency of the Ports Industry must now be put firmly on the ports themselves. That means a return in some cases to the same private sector influences that produced the crisis that Lord Rochdale had to resolve. With the heavy labour severance costs and surplus capacity in the major ports, how will it be possible for them to maintain efficiency without being given considerable financial help, which the Secretary of State will shortly have to recommend to the House?

Much has been said about the British Transport Docks Board. I have had much to do with the board in Hull over the years. Our exchanges have been controversial, but it cannot be denied that it is a profitable industry. The Secretary of State made it clear that the reason for the privatisation is the need to roll back the public sector. That is an ideological reason.

I am the last to condemn ideological reasons, because I campaign on ideological grounds myself. It is legitimate for the Secretary of State to say that he wishes to return parts of the public sector to the private sector. I disagree, but that must be the Minister's reason. There cannot be any other reason, because the BTDB is certainly not short of cash. It has made considerable profits, has £80 million in reserves and is not short of capital to meet its investment requirements. According to the Secretary of State, it has a good industrial relations record and it is certainly not disorganised. In another press handout, the Secretary of State said that it is a "happy mix of ports". He wants to keep 51 per cent. control in order to prevent the sale of profitable sections of the British Transport Docks Board.

The BTDB is a sound organisation which has done well in financial terms and would match any private sector return. We reject the Government view that the community should not continue to benefit from all its investments or that the national interest can be considered to be the same as the private interest. There are differences between the two sides of the House on those fundamental points.

The privatisation of the board is unique. It is a private company, free from Government control. The chairman declares that that is one of its advantages. It is free in finance, investment and development. It will have equity capital. It is said that the Secretary of State will hold 51 per cent. of the shares, though that is not written into the Bill. Questions are raised about those who will buy the other 49 per cent.

Presumably that minority will dictate the commercial policy of the board. The Minister says that he will not intervene in any decisions. The minority will appoint directors and determine commercial policy as they see fit. The Secretary of State will be holding 51 per cent. of the shares on behalf of the taxpayer, but he will not be prepared to intervene in decisions that will affect whole communities depending on ports. I do not know for how long the Secretary of State will be able to hold that position, but we do not believe that the taxpayer, who has put a lot on money into the industry, should be disadvantaged. We strongly disagree with the Government's proposals.

The Minister has also given up the right to appoint members to local boards, the consultative area bodies that will seek to exercise the influence of the community on major port developments in their areas. Their members will be appointed by the BTDB.

The Minister has removed the controls on sales to the private sector, but has guaranteed that there will be no takeover of the BTDB. I assume that that is his intention in holding 51 per cent. of the shares. He will allow the board to take over other companies while it is protected from being taken over itself. That is a unique sort of private company. Presumably it may be in the market to purchase the harbours that will be separated from Sealink under the Bill.

The Government go further. The nationalised industries have inevitably been restricted because the belief has been that as they are big organisations they may not use their power correctly. When the docks board goes private, it will be allowed to buy businesses, such as road haulage, shipping agency work and other firms doing work in the port areas which the nationalised industry could not do. The docks board will become stronger within its ports.

If anyone wishes to appeal to an independent body against BTDB dues he will be unable to, because the Minister has got rid of the statutory independent body to assess the position, such matters will be referred to him for judgment. That will considerably strengthen the private transport docks board. The Minister will be a major shareholder, but will not exercise any influence.

It is our belief that the users' interests will be significantly weakened. The Minister has made clear that he will not intervene in commercial matters except in the decision to sell off. I presume that in other areas, such as the appointment of directors and commercial policy, he will exercise no judgment. We think that is fundamentally wrong.

Another matter that causes concern is that the Bill gives the Minister powers to direct the selling of shares in this industry. Indeed, he may have to force the industry to sell at a most unfavourable time.

It has been said that the privatisation of Cook's was disadvantaged by this situation. It is possible that we will witness difficulties in the timing of such sales. A number of public industries that are to be privatised will be trying to float their shares within the next two or three years. It will take a year before the effect of the Bill—the sale of assets—reaches the market. It is possible that the shares will be in the market at an unfavourable time for selling. The Government may have to decide whether to force some kind of share allocation against the commercial judgment to sell the shares after the election of the next Government. Clearly a political decision will have to be taken.

I conclude by repeating the comments made about British Rail investment. Nationalised industries have been disadvantaged by successive Governments over the past few years. They have not received sufficient money for investment. That is the unpalatable fact. That was because of Treasury rules on the amount of investment.

If we are prepared to say that our investment has not been sufficient to maintain the British railways system, the Minister should not say that, because he has given the same amount as the Labour Government gave, that should be enough.

It is evident for all to see that, according to the rail accident reports, insufficient attention has been paid to rail maintenance. There has been a reduction in the track on which trains travel. Investment in engines is insufficient. We have seen all kinds of examples. The Minister should be aware that productivity alone is not sufficient to solve this problem.

The Monopolies and Mergers Commission has pointed out in relation to railways in the South-East that productivity alone will not be sufficient to finance the investment requirement.

My final point is that, if the Minister provided as much money to British Rail as American and European Governments give to their railways systems, there would be no need to sell off subsidiaries to raise cash. But since he chooses not to do that or to allow sufficient investment, it is not surprising that British Rail management says that if its only choice is to get private investment, that is welcome because the system will collapse if it does not get it.

The important point for the Minister to recognise is that money can be given to the nationalised industries. They can utilise the possibility of raising money on assets, such as hotels. They do not need equity financing to achieve that means of financing by the private sector. However, that is prevented by Treasury rules. A 51 per cent. ownership means that it is a public sector industry. But that is apparently not so if it is a docks industry. The docks can be owned 51 per cent. and be free of the Treasury, but British Rail will be forced to sell 51 per cent. to be free of the Treasury.

It has been said that Tory Governments always use the opportunity to sell off profitable sectors to their friends. We are beginning to witness that again. The Government should know that any attempt to sell off or to direct the selling off of profitable sectors of nationalised industries within the period of the run-up to the election will be resisted by the Labour Party.

It should be made clear to all who seek to buy shares in these companies that they will not benefit from their action. As soon as the Labour Opposition are returned to power, they will take the quickest means possible to regain control of these sectors and to withdraw the obstacles that have prevented their development in the past. If the Bill becomes law and allows the dissipation of public assets, thereby disadvantaging the public sector and the national interest, we shall not feel inhibited from acting for the public interest as strongly as this Government have acted for the private interest that they represent.