Speeches, Interviews & Other Statements

Complete list of 8,000+ Thatcher statements & texts of many of them

1969 Apr 17 Th
Margaret Thatcher

HC Standing Committee [Transport (London) (recommitted) Bill]

Document type: Speeches, interviews, etc.
Venue: House of Commons
Source: Hansard HC Standing Committee A [155-178]
Editorial comments: 1030-1140. Extract from the Fourth Sitting. The debate at this Sitting on the amendment to which MT spoke is reproduced in full.
Importance ranking: Minor
Word count: 8485
Themes: Privatized & state industries, Local government, Transport
[column 155]

TRANSPORT (LONDON) (re-committed) BILL

STANDING COMMITTEE A

OFFICIAL REPORT

Thursday, 17th April, 1969

[Sir Beresford Craddock in the Chair]

Clause 6

General powers of Executive

Amendment No. 28 proposed [15th April], in page 7, line 8, at the beginning, to insert:

‘with the consent of and’.—[Mr. Michael Heseltine.]

10.30 a.m.

Question again proposed.

The Chairman

I remind the Committee that with this Amendment we are taking the following Amendments:

No. 29, in page 7, line 8, leave out paragraph (i).

No. 102, in page 7, line 8, leave out ‘subject to any directions by the Council,’.

No. 30, in page 7, line 11, leave out ‘or in any of the national transport authorities’.

No. 31, in page 7, line 12, at end insert:

‘where the Executive or a subsidiary of the Executive has the requisite facilities or skills in connection with some existing activity of the Executive or its subsidiary’.

No. 32, in page 7, line 12, at end insert:

‘but nothing in this paragraph shall authorise the Executive to construct, manufacture or produce anything which is required by any of the national transport authorities in pursuance of their powers under section 48(2) of the Act of 1968’.

No. 103, in page 7, line 12, at end insert:

‘or for outside persons (that is to say, to persons other than an authority to whom this section applies or a subsidiary of such an authority);’.

No. 105, in page 7, line 12, at end insert:

‘and which the Executive are satisfied cannot be satisfactorily obtained for those purposes by any other means’.

The Minister of Transport (Mr. Richard Marsh)

I think that the Committee would probably like to offer its congratulations [column 156]to the hon. Member for Southgate (Mr. Berry) who, despite his very arduous Parliamentary duties, has been showing a very proper concern for the future of the nation.

I intervene at this stage—and I apologise to the Committee that I shall have to leave at a fairly early stage—to comment on Amendment No. 32. The bulk of the Amendments put down by the hon. Member for Tavistock (Mr. Michael Heseltine) relate to direct arguments of principle. We shall debate them in the course of this Committee. I doubt whether we shall succeed in getting them all withdrawn by hon. Gentlemen opposite, although this would be obviously the sensible thing to do.

Amendment No. 32 is in a somewhat different category. What concerns the hon. Member is the possibility that the Executive might manufacture for the outside market generally, through the back door of the nationalised industries. It might use the nationalised industries as its wholesaler in the outside world. I want to make it quite clear that that is not the intention of the Government.

We do not propose to accept this Amendment, because we think that it is impractical. It would place upon the Executive the job of satisfying itself about the end use of any items which it provided for the nationalised industries. It would have to satisfy itself that anything which it supplied to them was not to be used subsequently outside those nationalised industries. That would be a very onerous responsibility. It is not the job of the vendor to check the eventual use of every single item that he manufactures.

The fear which the hon Gentleman expressed in the course of his last speech is one which we can understand, but we think that it is not justified in practice. The London Transport Executive will be well aware of its responsibility, and will know that to use the provisions of the Act in this way would be wrong. Nonetheless, it is right to make it quite clear that is not the intention of this part of the Bill. In exercising his powers under Section 48 of the Transport Act, in relation to periodic approval of the national transport authorities' proposals for manufacturing and other services under that Section, the Minister would not consent to any such activities involving the London Transport Executive in this way. [column 157]

The Amendment, as drafted, is impractical. It places an obligation upon the Executive to make itself aware of what will happen at the end with any items that it supplies to the nationalised industries. This would be too cumbersome a procedure. We do not believe that the London Transport Executive will want to use its powers in this way. If any attempt were made to use its powers in that way, it would not be allowed. It would be disapproved under Section 48 of the Transport Act.

Mr. Hugh Rossi

I am grateful to the Minister for that reply, but he has touched only on one of the Amendments before the Committee.

The arguments for Amendment No. 32 are the same arguments as one would wish to use in favour of Amendment No. 105. The Council has a right of veto but, subject to that right of veto, the Executive will have power

“to construct, manufacture and produce anything which is required for the purposes of, or of a subsidiary of, the Executive or any of the national transport authorities or for the purpose of the Council” .

It may well be that Section 48 of the Transport Act could be invoked in order to deal with anything on behalf of the national transport authorities. Perhaps the Minister will tell us whether this power exists also in respect of manufacture for the purposes of the Executive or the Council.

We are dealing with paragraph (i). That could provide the greatest possible powers of manufacture and production. We have seen from our earlier debates that the Executive has power to carry passengers by any form of land or water transport, and hovercraft—and we are told that that includes hydrofoils. Does this mean that the Executive can go into the aircraft industry? It can manufacture and produce anything for the purposes of the Executive. If we leave the Clause as wide as that the Executive can build aircraft, hovercraft and hydrofoils.

We are also told that it will have the power to run garages and petrol stations. Is it the intention of the Minister that the Executive, with the consent of the G.L.C., should build equipment for petrol stations and garages? Does the Minister think that his powers under Section 48 of the Transport Act are sufficient to give him a [column 158]veto to interfere in such activities? These are the questions that occur to me.

The rather strange aspect of this Clause is that the Greater London Council does not want these powers and, not wanting them, I am curious to know why the Minister is insisting on giving it these powers. Does The Minister himself want the G.L.C. to enter into the aeronautical industry? The G.L.C. does not want to, but the Minister is insisting that it should have power to do so if it wishes.

Mr. Marsh

The hon. Gentleman has hit the nail on the head. The Minister is not telling it that it has to use these powers, but Greater London Councils change as the years roll past, and this one may change faster than many others. Nonetheless, saying not that the Greater London Council shall use these powers, but that they shall be available for any duly-elected Greater London Council to use if it so wishes. There is no obligation on it; it merely has the opportunity. This Greater London Council does not want the powers, and presumably will not use them. But another Greater London Council might want the powers, and there is no reason why it should not have them.

Mr. Rossi

Will the right hon. Gentleman reply to the question I posed a little earlier? Is this a power that the Minister can interpose with his veto, under Section 48?

Mr. Marsh

I shall certainly look into that point, and my hon. Friend will give a clear and concise answer. I do not think that that would be the case because the provisions of Section 48 of the Transport Act would apply to the nationalised industries, as such, rather than to the London Transport Executive. That is why Section 48, in the case of Amendment 32, relates to nationalised industries reselling that which they have purchased from the London Transport Executive.

Mr. Rossi

I am grateful to the Minister. He has emphasised the point that I am trying to make. He made great play of the fact that Amendment No. 32 provides reserve powers for the Minister to intervene if the Council or the Executive tries to extend its functions unreasonably into fields not contemplated by Parliament. But in respect of Amendment No. 105 [column 159]the Minister has apparently conceded that there is no reserve power to prevent the Council and the Executive venturing into fields which, from a national point of view, it might be most undesirable for them to enter. I understand that the Minister does not have power to intervene; it is a matter entirely for the discretion of the G.L.C.

The Amendment tries to impose a reasonable restriction upon this power, in that it says that powers of construction, manufacture and production for the purposes of the Executive, the transport authorities or the Council, are to be exercised only if the Executive is satisfied that these things cannot be satisfactorily obtained for those purposes by other means. In other words, if there are already available on the market the goods that the Executive requires, it shall buy those goods and shall not set up in competition with other branches of industry.

That is the simple purpose of the Amendment. It is a restriction that the Greater London Council itself thinks reasonable. The Minister speaks of possible changes in the political control of the Greater London Council, but does he envisage that a Greater London Council under the control of his party would wish to construct manufactured components which are readily available elsewhere on the market but which, for a whim, his colleagues on the Greater London Council feel they ought to manufacture themselves?

Is the Minister telling the Committee that it is possible that the Greater London Council, under the control of the Labour Party, would want to go into the aeronautical industry, or into the manufacture of equipment for garages and petrol stations—to enter into industry, with all the resources at its command, in an extremely large way in competition with existing organisations? This may be what he is saying to the Committee. He may not want this restriction applied because he would not wish to fetter the activities of his political party if it gained control of the G.L.C.

The Chairman

Order. I am sorry to interrupt the hon. Gentleman, but the Minister has no responsibility in that connection. I do not see the relevance of the hon. Member's argument.

[column 160]

Mr. Rossi

Thank you, Sir Beresford. I was only asking the Minister a series of questions because he told the Committee that he wanted this power to be retained in case, at some future date, the G.L.C., under other control, would want to do these things. This is what I understood him to say.

The Chairman

I am sorry to interrupt again. If that is the case I apologise.

Mr. Rossi

There is never any need for you to apologise, Sir Beresford, but I appreciate the gesture.

The Minister may care to answer these questions in some detail, because we are entitled to know precisely what is in his mind in conferring powers that the present G.L.C. does not want and may even consider it undesirable to have. The Minister is looking to the future, when there is some change in the G.L.C. Can he tell us what are his thoughts for that future? How does he envisage any future G.L.C. exercising these extremely wide powers of manufacture and construction across the wide field of activities that he is conferring upon the Executive in this Bill? We should like to know.

Our fears may be unfounded, but we should like the Minister to give us an assurance on this. If our fears are unfounded, and these powers are not intended or required, why cannot he accept our very simple Amendment, which would restrict these powers to the manufacture of articles which cannot be bought elsewhere on the market.

10.45 a.m.

Mr. Eric Ogden

The Committee may agree that hon. Members opposite tend to worry a great deal about some things. It may show a sense of insecurity, even in their present state of rather brief glory.

This Bill is supposed to be a practical Bill, about practical things. I do not believe that anyone, on either side of the Committee, expects the London Transport Executive suddenly to decide that it wants to develop a Concorde No. 3, as suggested by the hon. Member for Hornsey (Mr. Rossi). That flight of fantasy does not require an answer from anyone on this side.

I have been reading what the hon. Member for Tavistock (Mr. Michael Heseltine) said last time at the end of the [column 161]debate, which amounts almost to a debate on the Clause, because there are so many different versions of Amendments that might or might not be accepted. I want to put two points forward because it is a little difficult to follow the arguments of hon. Members opposite, particularly this morning, when hon. Members on this side of the Committee are rather dazzled by the glorious blue halo surrounding the hon. Member for Finchley (Mrs. Thatcher).

The Opposition—and many Members on my side of the House—are continually groaning and moaning about the ever-tightening grip of Whitehall and the central control of Westminster. We hear great pleas for devolution and participation, and about regional councils and national parliaments, and all kinds of things, being set up to take away some responsibilities and powers from Parliament and give them back to local authorities or regional councils.

A lot of nonsense is talked about this. I see no great queues of people wanting to join local councils or serve on parish councils. It is not the job of a Minister of Transport to decide who should make nuts and bolts for a passenger transport authority. This should be passed further down the line, and if a lower authority, of any party, is given powers, if it does not want them it will not use them. Such an authority may later decide that it does want them. I cannot believe that hon. Members opposite expect such authorities to go into a massive manufacturing operation quite subsidiary to their main purpose.

Many manufacturers of motor-cars could equally well make potato crisps, but they do not do so. They have a certain line of traffic and stick to what they can do best. Regardless of the fact that certain parts for specific products are readily made available by one industry to an authority, it may be that they could be made much more cheaply by the authority itself.

The hon. Lady may remember that on a previous occasion we talked a great deal about this point in relation to the manufacturing powers of the Coal Board. Many things made by the Coal Board are readily available outside, but the cost is much greater. In certain circumstances, it may well be a question not merely whether an article is available but whether the cost is suitable. [column 162]

Do the Opposition want this devolution from Whitehall? Do they want the Minister of Transport, or any other Minister, to decide the day-to-day running of every part of an authority's affairs, or are they willing to take a risk. Are they willing to trust the authorities lower down, of whatever political complexion, and say, “We will give them the powers they have been clamouring for, and everybody tells us they want, and if they do not want to use them, they need not do so” ?

Mr. Rossi

They do not want them.

Mr. Ogden

In general, every authority says that it wants more power—that it wants to be free of the grip of Whitehall. It says, “Blast the Civil Service—these poor gentlemen we know are there but whom we cannot see.” It wants the power to go down the line. I do not want a Minister of Transport to be involved in the question of the supply of nuts and bolts for the London Transport Executive. Authority must be handed down the line, but we must always make sure that people who use that authority do the job properly, because the responsibility is ours. We have a responsibility to see that the Executive does its job.

Mrs. Margaret Thatcher

Like the Richard MarshMinister, I have to leave early—which is the reason for the blue halo. I want to say one or two things about the Amendment, arising partly from what the Minister said, because we are getting into rather a muddle about it. The hon. Member for Liverpool, West Derby (Mr. Ogden) asked us not to put people in the grip of Whitehall. We are not talking about that. We are talking about the responsibility of Parliament, and in particular of this Committee, to express explicitly on the face of this Measure its intentions in legislative language. In other words, whatever we intend should be clearly laid down on the face of this Bill. That is all we are doing at the moment.

As I understood the Minister, he was saying that what the Bill says is not what we intend it to say, but, nevertheless, we should not do anything about it. That is a new legislative principle, and one which we should not accept. Let us just see, if either Amendment No. 32 or No. 105 is not inserted, what the Bill says, because [column 163]that is all that will guide the Executive and the G.L.C. The G.L.C. does not want these manufacturing powers.

The governing opening words of Clause 6 (1) are:

“Subject to the provisions of this Act, the Executive shall have power” ——

and paragraph (i) reads:

“subject to any directions by the Council, to construct, manufacture and produce anything which is required for any of the purposes of … the national transport authorities” .

Turning to the 1968 Act, to see what are the purposes of the national transport authorities under Section 48(2), and one finds this:

“Each of the authorities … shall have power … to manufacture for sale to outside persons … anything which the authority considers can advantageously be so manufactured …” .

Second,

“to sell to outside persons … anything which is of a kind which the authority or a subsidiary of theirs purchase in the course of some existing activity …” .

Third,

“to sell to outside persons petrol, oil and spare parts and accessories for motor vehicles …” .

They are the widest possible powers, now on the face of this Bill, which will pass into law unless we alter them.

If I understood the Minister, he was referring to another power which he has under Section 48(4), under which the only power he has in relation to the 1968 Act, not in relation to the Bill which we are now considering except in so far as incorporated by reference, is to direct the national transport authority to discontinue any of the activities. Was he in his undertaking saying that, if the G.L.C. or the Executive manufacturers or sells for any of the wider powers in Section 48, he would direct the national transport authorities to discontinue that activity? He has no power to direct the G.L.C. or the Executive to discontinue that activity. The only power he has is to direct the national transport authority to discontinue that activity in its totality. For that reason, we should not let this Clause go unamended, because what is on the face of the Bill will govern the activities of the Executive.

If we are to withdraw the Amendment, or even to desist from voting upon it, we require a specific undertaking that the sense of the Amendment be incorporated into the Bill on Report. I make that quite clear. I see that the [column 164]Bob BrownParliamentary Secretary, in the Minister's absence, is looking at something else in Section 48. He has marked a passage in subsection (4), and I shall stay for a few minutes in case he has another argument to present.

Mr. Ogden

The Committee will miss the hon. Lady when she has to go. She is always most meticulous in what she says, and the burden of her speech was absolutely correct until the latter part. She gave not enough emphasis to the first half-dozen words of paragraph (i):

“subject to any directions by the Council” .

Then it goes on to say all that the Executive can do if it wants. But it cannot do all the things which it wants because it is subject to any direction by the Council itself. The Council make say “Yes” or “No” . It is all subject to any direction of the Council. So there will be a double check of the Executive, by the Council itself, which will say whether the Executive is to make, say, Concordes 003, 004 and 005, and then the further check later by the Minister. I think that she will agree that the first words limit everything else to which she referred— “subject to any direction by the Council” .

Mrs. Thatcher

Yes, and it is our job to decide whether we want the Council to have those powers. We on our side do not.

Captain Walter Elliot

This debate, probably rightly, is being conducted on a high plane as to what the Council wants and what the Government want. I am one—to repeat a cliché—who believes that Government, whether national or local, belongs to the people, not the people to the Government. I speak as a humble ratepayer in the Greater London area. I do not know whether the Minister of Transport, as the right hon. Member for Greenwich, is also a ratepayer in Greater London, but, whether he is or not, I rather suspect that his motives are still concerned with the higher echelons of Government, because he referred in his speech to a possible change in the political complexion of the G.L.C. My hon. Friend the Member for Hornsey (Mr. Rossi), speaking earlier, said that the G.L.C. did not want these powers, whereas the Minister implied that a G.L.C. of a different political [column 165]complexion might want them. But, speaking as a ratepayer who owns this Government——

Mr. Ogden

Did the hon. Member say “owes” or “owns” ?

Captain Elliot

I said “owns” . I believe that the people own the Government, not the Government the people. Speaking as a humble ratepayer, I do not want my locally elected council to dabble in these matters all over the country. I do not want it to do it. I do not think that it is competent to do it. Naturally, I believe that the members composing the majority on the present G.L.C. are much more reasonable in their approach to these problems that a G.L.C. of the political complexion of hon. Members opposite. But, frankly, I do not trust any great bureaucracy. I believe that bureaucracies like to grab power, they look on small private individuals and small businesses, whether in transport or anything else, as a nuisance which might well be snuffed out.

I do not believe that these great councils are appropriate bodies to go into commercial business, as they will do under this Bill. No doubt, there might be some incentive to make a profit, but, as we know very well with nationalised and publicly run concerns, although making a profit might be an incentive, in these sort of matters the possibility of a loss is an even greater incentive, and that incentive they do not have. When they make a loss, the ratepayers make it up. I am most concerned that my elected council should not have these powers.

This is not a matter of political dogma. The Minister implied that, when his party takes over, if it ever does, it may want these powers. That is not the right approach at all. It is a matter for the ratepayers, of whom I am one. I view it all with the greatest concern.

11.0 a.m.

Mr. Ogden

I have been counting the number of hon. Members present at this time. Perhaps someone on this side could give an indication as to whether this debate is to be encouraged to continue or should just be allowed to take its normal course, with a vote. In the absence of such guidance at this time, I put two points to the hon. and gallant [column 166]Member for Carshalton (Capt. Walter Elliot). He said that he spoke as a ratepayer. Although everyone of us is a ratepayer in one form or another, I do not think that the people who send us here ask us to speak as ratepayers. I was rather intrigued by the title which the hon. and gallant Gentleman gave himself—a “humble ratepayer” . I wish that everyone paying rates to my authority was paying them on the scale which the hon. and gallant Gentleman pays them. We should be much more prosperous.

As a ratepayer in the North-West, I could complain that both rates and taxes from people in the North-West are being used to subsidise London Transport. If some of the money going into London Transport was spent in the North-West, we might be a great deal more prosperous. We ought not to speak only for the ratepayers; that is the job for democrats further down the line. As elected representatives for the good government of the whole country, yes; but not as ratepayers; that is for the councillors, aldermen and everybody else further down.

The Joint Parliamentary Secretary to the Ministry of Transport (Mr. Bob Brown)

Perhaps I might answer the hon. Lady the Member for Finchley (Mrs. Thatcher), as I know she is wanting to leave the Committee. The Minister does not have to direct the nationalised authority to desist altogether from an activity under Section 48(4)(a). The Minister can approve its proposals, subject to modifications or conditions. The Minister could, therefore, ensure that the L.T.E.'s manufacturing powers were not used in support of the general nationalised industry powers under Section 48(4)(a) of the 1968 Act.

The hon. Member for Hornsey (Mr. Rossi) was really going into the realms of fantasy, and my hon. Friend the Member for West Derby (Mr. Ogden) took it to the point of suggesting that we might have a Concorde 003 or 004 produced by the L.T.E. That is a pure flight of fancy because the L.T.E. cannot make aircraft, having no power to carry by air, except by hovercraft, and hovercraft are specifically dealt with in the Bill.

Mr. Rossi

Could it go into the shipbuilding industry? It can carry by water. Could it build ocean liners?

[column 167]

Mr. Brown

That is a further flight of fancy, and I do not intend to go into the realms of fantasy in this discussion. Political dogma was mentioned by the hon. and gallant Member for Carshalton (Capt. Walter Elliot), and I think that on this Clause we shall see more political dogma than we have seen since the discussions on the last Transport Bill. Certainly, this provision of the Bill has given rise to considerable interest, to put it mildly, as is shown by the number of Amendments put down. I do not want to overheat the Committee, but it is clear that there are two clear schools of thought here in relation to manufacturing powers. In the Government's view, the fears which have been expressed by the Opposition about the extent of the operating powers of the L.T.E. are completely misconceived.

From the remarks which have been made, it might appear that this body would be able to compete generally on the open market. That is just not so. In view of the unique position of London Transport and its responsibility to local rather than to central government, the Government have thought it right to place certain limitations on its manufacturing powers. This type of limitation, I know, does not please all my hon. Friends. We have the completely reverse point of view from hon. Members opposite, who would limit the L.T.E. completely; they would go even further than the 1962 Act. I say to my hon. Friends that we are considerably widening in this Bill the powers which London Transport already possesses under the 1962 Act. For instance, it can now manufacture buses for itself if it so desires, a power denied to it under the 1962 Act.

I do not want to go over the ground which the Minister has already covered in respect of Amendment No. 32. What he said and what I have said to the hon. Lady should be sufficient assurance for the Opposition. I do not expect that they will be prepared to withdraw their Amendments, but I emphasise what the Minister has already said, that the wise thing to do would be to withdraw them, on the assurances which have been given.

Mrs. Thatcher

May I pursue the point which the Bob BrownParliamentary Secretary raised about the Richard MarshMinister's powers under Section 48(4)(a) of the Transport Act, 1968, the nub of which was that the Minister [column 168]could do something else other than direct the national transport authorities to discontinue, that he could attach conditions to their being able to carry on these activities at all. So he could. But the only time at which he can operate those powers under paragraph (a) is when the proposals for manufacture and sale are submitted to him. That means that the national transport authority has to trot along and say to the Minister, “We are going into our wider powers of manufacture and sale; these are our proposals” . That would be the only opportunity for him to say, “Yes, I approve your proposals for manufacture and sale, on condition that, in carrying out your activities, you do not take anything from the G.L.C., manufactured or sold to you by them” . I doubt very much that he will attach that condition at the outset. Once he has approved the general manufacture or sale powers under Clause 48, the only power he then has seems to me to come under paragraph (b), which is to direct them to discontinue. Perhaps we could have some advice on the point, because, if that be so, we need a specific Amendment on the face of this subsection or somewhere in the Bill saying that the Minister will definitely use his powers of approval in such a way as to prevent the national transport authorities or a subsidiary of theirs using goods supplied to them by the G.L.C. or the Executive under the subsection.

Mr. Rossi

May I pursue the Parliamentary Secretary's reply to me, first, on the question of carriage by air? It is true that there is nothing in Clause 6 which enables the G.L.C. or the Executive to carry passengers by air. But under paragraph (f) it has power to make arrangements for the provision of services by air between places in Greater London or between such places and places outside Greater London. Applying paragraph (i) to that, it could easily be said that it was required to manufacture aircraft or parts of aircraft for the purpose of provision of those services by air.

We have known time and time again of Parliament's having a particular intention in an Act of Parliament and wanting certain consequences to flow from it, but using words which are capable of being interpreted as enabling other things to be done. Therefore the duty is strongly [column 169]upon Parliament and this Committee to use only those words which will achieve what Parliament requires to be done, and no more.

In common sense and practical terms I may have used exaggerated language, because it cannot be in anybody's present contemplation that the G.L.C. would want to shipbuild, or buy up a shipbuilding yard in the North-East. It might not be in our contemplation today that the G.L.C. would want to build aircraft, hovercraft or hydrofoils, but circumstances might arise when that might be attractive. I have referred to the more exaggerated forms of manufacture, but between that extreme and the extreme of printing stationery with its own letter-head there is a whole range of activity in which it can indulge in the terms of the Clause. I have deliberately posited the most exaggerated extreme that I can imagine, because I have asked the Minister to indicate the limits he has in his own mind. This he has failed to do.

We know that the present G.L.C. does not wish to exercise these powers; it is even asking that we do not give it these powers. But the Minister has said that he foresees some future G.L.C., on some future occasion, requiring powers of this kind. I have asked him if he has this in mind. Can he spell out to the Committee exactly what powers of manufacture he contemplates for the future? We are still awaiting a reply to that question. We are entitled to one, because we must limit the language that we use in the Bill in such a way that we provide those powers and no additional powers, for the reasons that I indicated earlier.

When the Parliamentary Secretary answers that question, which I have now asked for the second or third time, he may also be able to tell us what objections there are to limiting the power of manufacture to items which the Executive cannot satisfactorily obtain elsewhere. What is the objection to that formula? After all, that is the very formula that the Minister is using at the end of paragraph (h).

That paragraph gives power to supply spare parts, components, and so on, for vehicles that the Executive has sold off. So far as the Executive is satisfied that these cannot be satisfactorily obtained by any other means it has power to manufacture those spare parts. But it can do so only when they cannot be got elsewhere. Why [column 170]does the Minister limit the power in paragraph (h) but not in paragraph (i)? What is the distinction of principle that exists between the manufacture of spare parts and components for obsolescent vehicles and the manufacture and construction of anything ranging from Concorde to letter-headed notepaper? May the Committee have answers to these questions, and not evasion?

11.15 a.m.

Captain Elliot

If the G.L.C. is empowered to carry out all these services will it pay S.E.T. in the same way as private industry does? We know that nationalised industries do not pay it. Would he answer that question?

Mr. Brown

I will try to answer the point made by the hon. Member for Finchley (Mrs. Thatcher). In approving any proposals under Section 48(4)(a) of the 1968 Act it would be open to the Minister to attach a condition that at no time was the nationalised industry to use L.T.E. goods for sale on the open market. I think that that answers the point.

Mrs. Thatcher

I do not think so. I said that that would be open to him, and that I doubted very much whether he would address his mind to it in giving approval to a proposal as required under that paragraph. I gather that he has agreed, by implication, that once approval is given, the only power is that provided under paragraph (b).

Mr. Brown

On the question that the hon. and gallant Member for Carshalton (Captain Walter Elliot) has asked me—clearly I will need to think about it. I could not give him an off-the-cuff answer on the question of the Selective Employment Tax.

I suggest that the hon. Member for Hornsey (Mr. Rossi) is asking me for assurances that he must know I am not prepared to give. The basis of the Bill is the same as that covering the appointment and setting up of the passenger transport authorities in other conurbations. We are giving local government control of its own local transport. I would have thought that that basic principle would not have been contested by the Opposition. They would surely agree that local transport should be run by local people, in the interests of the ratepayers. [column 171]

It is not fair to suggest that because the G.L.C. at this moment happens to be of a certain political complexion we should necessarily say that for all time it will be governed by the same considerations. It is unreasonable for the hon. Member for Hornsey to ask me to give him such an assurance. I am not prepared to give it.

It has been argued that the present G.L.C. is conducting its affairs in accordance with the mandate that it has from the ratepayers. Clearly, any future G.L.C. must be free to do the same.

Mr. Anthony Berry

Would it not be sensible, therefore, if a future G.L.C. wish to have different powers, for it to tell Parliament, “We have a different mandate from the ratepayers. We think we need these extra powers, and we would like to use them. Please can we have them from Parliament?”

Mr. Brown

I suggest that it is equally sensible to allow the G.L.C.—any G.L.C.—to have the powers that it may require. The present G.L.C. has ample safeguards written into the Bill in other Clauses.

Mr. Michael Heseltine

There is one welcome development this morning which we must not allow to go unnoticed; the hon. Member for Carlisle (Mr. Ron Lewis) has quite obviously been converted by the arguments which we have put forward, and he does not wish to press the two widening Amendments standing in his name. He is right, and I hope that he will feel it possible to drop some of the other widening Amendments in his name which come later on. That is the only good news to have come out of this morning's discussions.

The most interesting development has been that we have found a loophole which had not occurred to the Minister and those who drafted the Bill. The Government have done a commendable job this morning in trying to close the gap, but they have not closed it, and they know as well as we do, that in spite of the assurances given us to-day, the gap cannot be closed. It cannot be closed because, as my hon. Friend the Member for Finchley (Mrs. Thatcher) rightly pointed out, we are talking here about two extreme powers built into the 1968 Act, neither of which is in practice policeable under the control of the Ministry. [column 172]

By Amendment No. 32 we tried only to stop the London Transport Executive from manufacturing products which would then be resold under the 1968 Act powers. We were then told by the Minister that there was no problem because the Minister would not approve the scheme. We have now pointed out that that is a general approval which has to run before the establishment of some reselling operation, of whatever sort. At that stage, it would be perfectly reasonable for there to be no details worth talking about as to where the various products to be sold were to come from, though it is true that the Minister could attach conditions, and I shall return to that in a second.

The other argument put forward is that the Minister, having discovered in some way, perhaps accidentally, that the products of the London Transport Executive were being sold on the open market, could instruct that the whole scheme then being carried out by nationalised transport authority be discontinued.

May we look at these two arguments? The first was that the Government were not prepared to accept the Amendment because the Executive could not be expected to satisfy itself about where the products it was selling would end up. Yet we are now told that the people purchasing these products, who are, of course, nationalised transport boards of significant size, will be able to exercise the kind of control which the London Transport Executive will not be able to exercise. I appreciate that there is a difference in that the ultimate control has passed from the London Transport Executive. But, in the context of the scope of the nationalised transport boards and authorities, it is impossible to see them being able to exercise such control on the individual products which have been purchased through central purchasing departments. It is extraordinary that, whereas it is assumed that the London Transport Executive cannot police this kind of operation, the nationalised transport authorities should be able to do so.

Let us look at the practical details of the way in which the Minister believes that there will be control. Let us consider the simple sort of products which it may be considered necessary for the London Transport Executive to manufacture on its own behalf, say, nuts and bolts. There is no identifying mark on any part of a [column 173]nut or a bolt showing where it was manufactured, or any of its history before the stage at which it was purchased. The nuts and bolts have been manufactured by the London Transport Executive to the specific requirements of one of its vehicles. The Executive then discovers that the same kind of vehicles are being operated by the nationalised transport authorities. So the nuts and bolts are transferred or sold, under this particular Clause, to the nationalised transport authorities. Are we seriously to believe that nuts and bolts manufactured by the London Transport Executive will all be painted one colour so that they will not be confused with identical nuts and bolts which have been manufactured by the private sector and are being bought in in the same way? Will that kind of detail be applied to make sure that this procedure is policed properly? If paint were purchased partly from the private sector and partly from the public sector through the London Transport Executive, will the Ministry of Transport be watching to see whether one type of red paint has been bought from the London Transport Executive and not resold, whereas another identical paint has been bought from the private sector, in which case it can be resold? Is that the kind of policing which the Minister believes he is capable of injecting into this operation?

I suppose that hon. Members opposite might argue that, if this fear is as justifiable as I say, it is for the private sector to keep a watching brief and to draw the attention of the Ministry to anything done in this way. But how is the private sector to distinguish between products which, to all intents and purposes, are identical and which bear no identifying mark showing where they have been manufactured? Once products of that kind, ordinary day-to-day products, find their way into the hands of the nationalised transport authorities, it will be impossible for anyone to tell, without the most rigorous stock-controlling techniques, where they came from.

Therefore, it is complete humbug for the Minister to tell us that he will prevent this situation arising. He should introduce into the Bill the clearest possible restriction, the restriction which was intended. For the best of reasons, no doubt, it escaped the net of the Parliamentary draftsmen, and we believe that it should [column 174]be inserted without more ado. Certainly, we shall want to vote on the Amendment.

But I go further. I should want to draw this matter to the attention of the Greater London Council. I should want them to understand that, despite the representations which have been made, this power is included in the legislation. It is one which, I believe, it will rightly want to resist. But, if it wants to resist this power, that is as nothing to its general attitude towards the very wide powers included in paragraph (i) as a whole.

We heard from the hon. Member for West Derby (Mr. Ogden) what superficially might appear to be an eloquent appeal for the sort of devolution of powers which many hon. Members on both sides of the House advocate. I should like to tell him why we believe that in this case it is wrong to put powers of this kind into the hands of a local authority. To take the biggest single argument in practical terms, it is because there is no commercial answerability in local authority affairs; nor can there be, nor will a way be found to inject it. First, there are all the political pressures which can override commercial necessities at any one time, often for questionable reasons. But, more significant than that, assuming that there will always be people to take courageous as opposed to expedient views, in the framework of what we are here discussing, the assets which are being transferred to the London Transport Executive from the London Transport Board will be written down to only 10 per cent. of their value. In these circumstances, how can commercial considerations play a part? The asset value has been written down, not by some means of magical liquidation but by transferring on to the back of the taxpayer what at this moment is on the back of the London Transport Board. The effect is very clear: the nation at large will be paying year by year the interest charges on the capital debt which will not pass to London Transport. Therefore, London Transport will be able to compete in many areas, through the sort of powers we are discussing, at a highly subsidised rate.

In effect, hon. Members opposite, representing their own constituents, say that their constituents up and down the country should subsidise employment in London to manufacture at artificially low prices products which will then be used to compete with products which are being [column 175]produced in their constituencies at economical prices. I am staggered that they sit like lemons without so much as raising a peep of protest. I do not understand how the magnet of London can be allowed to exert such an influence without protest from hon. Members representing constituencies outside London.

11.30 a.m.

This is the greatest single subsidy ever handed to London. What are hon. Members on the back benches opposite doing about it? Absolutely nothing at all.

I want to make it clear that they will not allow this thing just to drift on without some checks and safeguards upon the future ravages of the London Transport Executive. I can assure them that if the party of which I am a member were in Government we would not allow those ravages to take place. The Minister is trying to sell his hon. Friends the argument that if they will only be patient London transport will one day be controlled by a Labour-controlled Greater London Council, but, in effect, the result will be that that Council will use its London Transport Executive to compete in a totally unfair way with the industries in the constituencies which they represent.

That is a happy prospect for the Parliamentary Labour Party to add to numerous other happy prospects which it has at the moment. I hope that we can understand exactly what the issues are. Devolution—leaving the local government to get on with it, hoping that it will exercise its power reasonably, and all the grand concepts which the hon. Member for Liverpool, West Derby (Mr. Ogden) was talking about—is a load of rubbish. I hope that the hon. Member will now see that clearly.

We are therefore left with the general attitude of hon. Members on this side of the Committee to paragraph (i). I have to say that we are against that paragraph absolutely through and through—hook, line and sinker. We were against that provision in the 1968 Act, wherever it appeared, and we are against it now. We will continue to be against it for the doctrinal and practical reasons that I have outlined, and we shall have no alternative but to vote for the Amendment deleting it from the Bill. [column 176]

We shall also vote for the Amendment which injects some control—Amendment No. 32—which we believe the Minister intended to introduce but which he has not done. The assurances which he has given to get round this situation are far from satisfactory, but to show what reasonable people we are—and in order to try to find a compromise—we should be prepared to abandon our decision to vote against paragraph (i) if we could have in its place Amendment No. 105, which gives, in terms of paragraph (h), precisely the same powers to the London Transport Executive within the terms of paragraph (i).

When we had discussions on paragraph (h) we heard that it was necessary for the London Transport Executive to manufacture certain spare parts, because they could not be found elsewhere. We took a reasonable and totally non-doctrinal view in order to give power to the Executive where it was proved necessary. We agreed to that and we did not vote against it. There was not an element of doctrine on this side of the Committee.

But in paragraph (i) this safeguard is not injected. What is the distinction? Why should there be this difference between paragraphs (i) and (h)? Exactly the same sort of manufacturing will go on, but in one paragraph we find a safeguard and in the other no safeguard at all. I understand only too well why there is no safeguard. The Minister is determined to try to arm a future Labour G.L.C. with the powers contained in paragraph (i) without any protection or safeguard.

In the circumstances we cannot use the protections which have been built into paragraph (h), but we are prepared to try to reach some compromise, if the safeguards which the Minister has put into paragraph (h) are embodied in paragraph (i). In those circumstances we should also wish to vote for Amendment No. 105.

I hope that I am able to carry my hon. Friends with me in this, because this is a totally noxious Clause. The legislation sets out to do some very desirable and exciting things, but to bog down the London Transport Executive with the task of worrying whether it should be in manufacturing, or retailing, or wholesaling, or whatever it may be—or producing and constructing fringe items which it has no need to do, is simply to divert it from its main task. In the future, when it has begun to solve the problems of London [column 177-178]transport, it may be argued that this power could be profitably explored. In those circumstances something would have to be done about the capital write-off.

I doubt whether the Executive would want to do that. It would be much better advised to argue the case in the circumstances that then prevailed. It is totally unacceptable to us that it should be given these powers in advance of the unlikely event that the G.L.C. went back to Labour control.

Amendment negatived.

Amendment No. 29 proposed, in page 7, line 8, leave out paragraph (i).—[Mr. Michael Heseltine.]

Question put, That the Amendment be made:——

The Committee divided: Ayes 5, Noes 7. Division No. 6]

Ayes

Berry , Mr. Anthony

Elliot , Captain Walter

Grant , Mr. Anthony

Heseltine , Mr. Michael

Rossi , Mr. Hugh

Noes

Boston , Mr. Terence

Brown , Mr. Bob

Coleman , Mr. Donald

Fletcher , Mr. Raymond

Lewis , Mr. Ron

McBride , Mr. Neil

Ogden , Mr. Eric

Amendment No. 32 proposed, in page 7, line 12, at end insert:

‘but nothing in this paragraph shall authorise the Executive to construct, manufacture or produce anything which is required by any of the national transport authorities in pursuance of their powers under section 48(2) of the Act of 1968’.—[Mr. Michael Heseltine.]

Question put, That the Amendment be made:——

The Committee divided: Ayes 5, Noes 7.

Division No.7]

Ayes

Berry , Mr. Anthony

Elliot , Captain Walter

Grant , Mr. Anthony

Heseltine , Mr. Michael

Rossi , Mr. Hugh

Noes

Boston , Mr. Terence

Brown , Mr. Bob

Coleman , Mr. Donald

Fletcher , Mr. Raymond

Lewis , Mr. Ron

McBride , Mr. Neil

Ogden , Mr. Eric

Amendment No. 105 proposed, in page 7, line 12, at end insert:

‘and which the Executive are satisfied cannot be satisfactorily obtained for those purposes by any other means’.—[Mr. Michael Heseltine.]

Question put, That the Amendment be made:——

The Committee divided: Ayes 5, Noes 7.

Division No. 8]

Ayes

Berry , Mr. Anthony

Elliot , Captain Walter

Grant , Mr. Anthony

Heseltine , Mr. Michael

Rossi , Mr. Hugh

Noes

Boston , Mr. Terence

Brown , Mr. Bob

Coleman , Mr. Donald

Fletcher , Mr. Raymond

Lewis , Mr. Ron

McBride , Mr. Neil

Ogden , Mr. Eric