HC Deb 12 November 1926 vol 199 cc1429-516

Order for Third Reading read.

The PARLIAMENTARY SECRETARY to the MINISTRY of TRANSPORT (Lieut.-Colonel Moore-Brabazon)

I beg to move, "That the Bill be now read the Third time."

I feel proud, after some three years of work on the subject, that I have the privilege of asking the House to read this Bill the Third time. We have had many opponents of the Bill, and one of the most strenuous has been my hon. Friend the Member for Watford (Mr. D. Herbert). 1 had anticipated, he being as he is, and knowing well the psychology of the House, that he was going to endeavour to-day rather to spoil the Third Reading by asking to re-commit a Clause. You will remember, Sir, that on the Second Reading he got the atmosphere entirely wrong for the speech of my right hon. Friend the Minister. May I say one more word about another opponent of this Bill, my hon. Friend the Member for Hampstead (Mr. Balfour)? He is what I would describe as the arch-ohm—the spirit of resistance to any progress in this direction. He reminds me very much, in his attitude towards electricity and the government in dealing with this subject, of the nurse to a child, who said, "Go into the other room, see what baby is doing, and tell her she must not." I expect that, if my hon. Friend were the Minister of Transport introducing a Bill on electricity, he would rush from the Front Bench to his Back Bench to oppose the very Measure he had advocated at this Bench.

This Bill is, indeed, complicated. I do not think it is so complicated on its technical side as on its legislative side, because legislation has been proceeding on this subject for so long, and has become so involved, that few people understand I do not believe that even now the man in the street knows really what this Bill is all about. It is so easy in a subject like this to sink into the valleys and not to see the peaks. My hon. Friend the Member for Hampstead and other opponents of the Bill time and again drag us down to the complications of fringe orders, load factors, Kitson clauses, power factors, kilowatts and kilo-volt- ampères. But really in all this fog the white peak of cheaper current for all is not seen as it should be seen by anyone who takes a large view of this Bill. We had three months in Committee on this subject, sitting, I think, three times a week, morning and afternoon. The Committee stage of a big Bill like this is a process of purification by fire, though many people have thought that the fire was meant to destroy, and not to purify.

While I am making these remarks about the Committee stage, I wish to pay a tribute to my hon. Friend, though political opponent, the Member for Limehouse (Mr. Attlee). The nationalisation of the electrical industry of this country has ever been clear to the hearts of hon. Members opposite, but we have had another way of dealing with the subject, and one which, I think, will make it unnecessary for them for ever to resort to that extreme measure, the nationalisation of the industry. It must have been to them a bitter blow that we had invented this way out, but yet, in the whole course of these very protracted proceedings, they never resorted to any Parliamentary trick to defeat us, which they might very easily have done.

The House will he desirous of knowing what alterations have taken place in the Bill as it left the House on Second Reading, now that it conies to us for Third Reading. We must start at the beginning. The original Bill proposed that the Board to be set up by the Bill should be the inspirers of the scheme throughout the country; but it was thought, and I think rightly thought, that the Electricity Commissioners were the people above any others in the whole country who knew the technical side of this problem, and that it was wiser that they should frame the scheme and submit it to the Board, that the Board should hold an inquiry, and that, after they were satisfied, they should put the scheme into force. It is interesting to note that particular change, because, in all the troubles of electrical legislation, the Commissioners always get a good deal of abuse from everybody concerned. Their task is a very difficult one; they have so often to decide the very complicated question whether a municipality or a company should increase its stations, or put down a new station. They come down in one part of the country on the one side, say on the side of the municipality, whereupon everyone in the company line says they are biased. In another part of the country, they come down on the side of the company, and then everyone connected with the municipality says they are biased in favour of companies. The pathetic thing is that these two extremes never meet, so that the abuse falls from both sides, and does not really neutralise itself. Those people who pretend that the Electricity Commissioners are theorists and unpractical have only to note the enormous demand that there is for their services from the great companies of London and other parts of England. It is, a pathetic thing for us that no less than two of our Commissioners have left the Government service, and gone back to their great industry, for which so many of their opponents think they are unqualified.

That is the first change which has taken place in the Bill. Then we have put into it, as one is always asked to do in a Bill of this character, many safety valves—courts of appeal and so on. I only hope that, in the metaphor of my right hon. Friend the Member for Carnarvon Boroughs (Mr. Lloyd George), when he spoke on the Second Reading, we have not put in so many safety valves that we can never get up steam at all. There is one misconception which I hope the House will now understand. It is as to who is subservient to whom, as between the Electricity Commissioners and the Board. Let me say that there is no question of one or the other being subservient to either. What happens is that the Electricity Commissioners inspire the scheme, and pass it to the Board; the Board holds an inquiry, puts the scheme into effect, and operates it, the Electricity Commissioners retiring to their original sphere of life, which was that of technical advisers to the Government and an impartial technical judicial body. The Board's work in the future will be to do what everyone has wanted to do, but which nobody has been able actually to effect, and that is to build a grid of interconnecting, lines between the various generating stations of this country. I do not think it is possible to envisage any area that can be looked upon as efficient if stations are not connected.

I want, if I may, to draw the attention of the House to a district in England which is, so to speak, our ideal of what a country should be from an electrical point of view. It is the case of a private company, and I take it because power companies have districts to deal with, whereas the great municipal undertakings have only one town as a rule. It is a fairer comparison to deal with big districts when one is speaking of the whole of England. I refer to the North East Power Company. That is a model which we should like to see the whole of England follow, and it has been to me a matter of very deep regret that that company has been one of the bitterest opponents of the Bill. That particular organisation started from three power companies and three distributing companies. It was seen by far-seeing engineers that an immense advantage to everyone could be effected if an amalgamation could be brought about, and they could pool their generation and consequently get advantages such as we contemplate by pooling the generations of the whole country. We have a district here of 1,400 square miles. There are three big stations. There are, I believe, about 12 waste heat stations, and there is one complicated station known as a wattless current station. The organisation of electric generation in that district is one of great complexity, as it always will be in a district where there are many generating stations. You cannot put the whole of your load upon one station, because at the far end of your district it would be uneconomical to do that. It would be more economical to generate current at the other end of your system. You cannot make your best stations take your base load even in a particular district, because you have waste heat stations which have to carry the base load. The balancing of generation in this particular district is one of great complexity and great delicacy.

The company object to this Bill because they have a belief that the Board will in their words "mess them about." I think there has been too much misconception as to what the Board is going to do. After all, the Board are not to be imbeciles, but sound business men, whose business as laid down in this particular Bill, is to see that generation of current in this country is done as efficiently as possible. Unless the gentlemen whom the Minister appoints as directors of the Board are quite incapable and unsuitable to hold their position, they surely will not destroy a model which it is their duty to emulate. I sometimes wonder what would happen if someone were to go up to the North-East coast, and cut every line that connected one of their stations to another station. From being one of the most efficient generating districts in England, it would fall from the first place to a very low one. But that is the condition which prevails in England to-day. That is the condition we are try- to get rid of, and yet the North East Power Company, with all their resources, with all their wealth, with all their power of propaganda, wish to deprive England of the very advantages which thy enjoy themselves.

There is a fallacy held by some people that the operations of the Board can, in certain cases, increase the price of current. For that reason one wants to see exactly how the Bill deals with undertakers and their selected stations. As the House appreciates, the Board has power to connect one station to another. Their object is to get current as cheaply as they can for the benefit of distributing companies, and one of the things they must do is to select stations. The selection of a station is based upon this, that the station is an efficient station, but is not carrying the load it could carry were it connected by the Board's grid to areas which it is unable at present to supply. The Board is able to give that station such a load that it can effect an economy upon its generation charges, and the economy it effects will always be greater than the charge which the Board puts upon the current that it generates. The claim, of course, of these owners of selected stations is that they should take the whole benefit which interconnection gives them. That is not fair. The benefit which the Board is able to give to selected stations, the Board alone can give by interconnection, and it is not right that the station should have all the benefit. The benefit should be passed to everyone in the grid. But lest their fears should he in any way real, there is a guarantee in the Bill that in no circumstances can the charges of generation in that particular selected station ever be greater than if they were left alone to generate by themselves.

Now we pass to the non-selected station, that being one of those numerous small stations sometimes called inefficient which it is hoped will be closed down, When we talk about inefficient stations, I hope no one will think that their inefficiency is due to bad management. The efficiency of electric generating stations so much depends on geography—whether they can get plenty of water, whether they can get coal cheaply floated to the side where generation takes place. In some cases, although the most efficient plant and the most efficient organisation exists, the price of current must necessarily be high, through no fault of organisation and no fault of the management, but because they are badly situated. In those cases the Board, having connected up to them, are allowed to close them down if they can show that the price of current to them will be cheaper than that at which they can generate it themselves, and in that comparison the grid price is compared to their running costs. There is no question of buying those stations. The capital charges are always being paid off by the consumer. After a certain number of years, of course, the capital charges are paid off, whereupon the price of current in that district is grid price alone, with no addition for capital charges. To effect complete interconnection, standardisation of frequency must take place, and it is absurd to pretend that standardisation of frequency is not a benefit to those people who already have the standard frequency. The hon. and gallant Gentleman the Member for Dulwich (Sir F. Hall) last night said it was no advantage to any station which has a standardised frequency that the rest of the country should standardise their frequency. It is of very great advantage to everyone that standardisation of frequency should take place. Not only is interconnection possible between districts where it was not possible before, but in the manufacture of all electrical plant there will be undoubtedly a diminution of price throughout the country, as manufacturers will have to deal with only one frequency instead of the many they have to-day.

Two changes have been made between the Second Reading and this stage of the Bill, which I think are very remarkable and they both were passed, curiously enough, without a Division. The first one was an alteration in the Bill to give power to the Board to close down compulsorily. Those were the very powers taken out of the 1919 Bill, which led to its failure. In our original Bill we had a somewhat ingenious device whereby if the Board could supply a company at a cheaper price than that at which they could generate, then the small station could charge no more to their customers than if they took current from the Board. The Committee thought that that idea was too complicated, and that it would be better if a case could be made out for closing down, that the closing down should take place immediately.

A further change which took place—not in Committee, but in this House on the Report stage—was to allow the local authorities to sell apparatus. As the House knows, in this Bill we are dealing with the generating side of electricity. Had we butted into the distribution side I do not know what thunder would have come down upon our heads. It has been bad enough in dealing with the generating side. The House will not dispute that generating costs in some cases are high, and you can only get them down to a certain figure, past which it is impossible to generate inure cheaply. In some of our important districts the cost of generation is very low and very good. In some others it is not so good. This Bill does effect a general lowering of prices on the generating side. The distributive side and the commercial side are just as important as the generating side, and I think it is an enormous advantage that, having given away the position as to whether a Corporation should trade in electricity or not, you should allow them to trade in the most efficient way possible. In this country we find that an engineer is always at the head of these electrical undertakings. In America the most highly paid salaried official of a company is the commercial manager. In so far as you can keep your load factor high, so automatically your costs go down. It is just as important, indeed even more important to try to keep your load factor up than anything else in the business of electricity.

The picture that we must look at is what this Bill tries to effect, namely, to superpose upon a very highly industrial country, and a very thickly populated country a grid. It is actually a physical entity; you can ring the changes on it, but without this physical entity, this grid, this inter-connection, no really efficient generation from the whole country's point of view can ever take place. The generating resources of the country are left in the hands of the present owners but they are co-ordinated by the Board to the best advantage of the community, to be most usefully employed. This grid is a reservoir for all the power at present going to waste in the country. The power from waste heat can be poured into it. The power from any new coal treatment can be poured into the reservoir. The water power which is going to waste can be poured into this national grid, and who knows whether soon we shall not be able to put tidal power into it.

There is a misconception, which is sometimes talked about, that this Bill is a device for spreading current to rural districts. We have never had the idea of penalising the commercial and industrial districts for the benefit of the rural. The only thing we have said from the beginning is that in the inter-connection which will now take place there will be lines running from one town to another which would net have existed before; and in those districts where the lines run it will be possible to tap off the current at a very low rate for the benefit of that particular part of the country. It will be interesting to see what type of consumption goes on in these new areas, and whether the load is a diverse load from what we find in ordinary towns.

It is necessary that a Bill like this should be passed now. A few years hence it would not be possible, from the point of view of cost, to effect standardisation and to give us the sound technical lines which this Bill puts forward. The Bill has this very great advantage that, although it does not change the price of current overnight, the further you look ahead the greater the benefits are to the country at large. If we pass this Measure to day the House will have passed a really big measure of far-reaching consequence, with effects which will be increasingly beneficial as time goes on. I like to think of these Benches as representing a slip-way down which this great ship slides from our hands and from our control. It goes to another firm, to another place to be "fitted out" That place has not always seen eye to eve with us in dealing with this particular subject of electricity, but I do hope and I do pray that they will not alter her to such an extent as to make her unseaworthy.

Mr. ATTLEE

I beg to move, to leave out from the word "That" to the end of the Question, and to add instead thereof the words this House cannot agree to the Third Reading of a Bill which, whilst purporting to secure a unified system of electricity supply, fails adequately to protect the public interests and perpetuates the existence of private ownership in a service which ought to be owned and controlled by the community and co-ordinated with the scientific production and utilisation of coal. On this Bill we have taken up a consistent attitude. On the Second Reading, and on this Third Reading, we are making it perfectly plain that the method adopted by the Government to deal with this very important problem is not our method, and is not the way in which we would deal with the subject. We believe that the Bill has been framed on wrong lines, but in the intermediate stages, where we have discussed the details, we have endeavoured, as far as we could, to improve the Bill and to safeguard whatever value there may be in it. I recognise that within the limits of the Bill the Government have stood firm to the Bill as it was introduced. I want to point out the very grave faults in the Bill, and to show that it does not really meet the problem with which we have to deal. This is an attempt by a Conservative Government to deal with a particular industry, and to act on the report of the Weir Committee, which was set up to consider the question. That Committee recommended the co-ordination of the industry, which up to then had been in the hands of separate organisations, into a connected whole. We ought to be glad that when a Committee does report that an industry needs reorganisation the Government should attempt such reorganisation because it has not been done in the case of other industries.

Let me just trace the course of this Measure. It illustrates clearly three separate attitudes towards the electrical industry. There is, first, the attitude of the Labour party, which is that industries must subserve the national well-being, and that the object of a Bill dealing with the electrical industry must be primarily in the interests of the whole community. Sharply conflicting with that attitude we have the view, put forward very frequently, that the electrical industry is primarily a field for making profits, and, in the third place, we have the Gover- nment's position. The Government recognises the need for some change, but say that they are bound by their principles not to interfere with opportunities for making private profit, and the whole attempt of this Measure has been to try and secure the reorganisation of the industry without interfering with those opportunities for making private profits. The failure to do that is really the failure to make this a good Bill. A Conservative Government really cannot legislate on these lines and take into account only the benefits to the community. I can say this on very good authority. The hon. Member for Hampstead (Mr. Balfour) made an interesting statement last night on this Bill. He said that the Attorney General has consistently endeavoured to detach various interests which are represented here—if that is the proper term to use—to buy off certain interests so as to detach the real volume of opinion in the Conservative ranks in opposition to this Bill. That is always the task of a Conservative Minister who is trying to get something through this House in opposition to private interests. Anyone who was present during the Committee stage, and also during the Report stage, will realise that the bulk of the Debates on this Measure has been nothing but a clamour of private interests. There has been the strident note of the company undertakers, which took up more than half of the time. Although that was the chief note in the orchestra, we have had also the gentler notes of the railways, the gas companies, dock undertakings, and the bankers and financiers. What was lacking in the Debates upstairs was that there were no speeches from business men who looked at the industry as a whole. It. was simply a matter how far this particular field of private interests was likely to be hurt or what advantage could he taken for particular private interests. That is really the failure of this Bill. Look at the electrical industry with which this Bill is supposed to deal. As the Parliamentary Secretary has pointed out, it leaves out one important field, the field of distribution; it leaves out a good deal more than that.

Broadly speaking, the chief operations of the industry are generation, transmission, distribution and the manufacture of appliances. The manufacture of machinery and appliances is hardly touched in the Bill, and has not been touched in any of the discussions, except for one attempt to make a closed market for British manufacturers. The supply of electrical machinery is not dealt with in the Bill, yet anybody knows that the industry is surrounded by rings of manufacturers and that a large portion of the money which will be put up in order to carry out this scheme is going into the pockets of the manufacturers. One great misfortune is that there is no Clause restricting the amount of profiteering that can he done by manufacturers. The Bill touches the industry at two points only, generation and transmission, and the Parliamentary Secretary said quite truly that while there had been a great clamour—I think he called it thunder—when they were proposing to deal with generation and transmission it would be nothing to the thunder that would have arisen if they had touched distribution. The reason is obvious. It is the distributing end of the industry which is the profit-making end, and this Bill, except for some feeble provisions in Clause 30, does not really deal with the distributing end at all. It is just there that we have the failure of the Bill. It really deals throughout with authorised undertakers and the supply of cheap and abundant current to authorised undertakers, but it does not lay it down that there shall be a cheap and abundant supply to the consumer.

The retailing end of the industry in this country is divided between municipalities, that is publicly owned undertakers and company undertakings and something like two-thirds of it is already in public hands. It is rather surprising, therefore, that there should be this fear of nationalisation. If under this Bill the main transmission lines are to be owned by the Board: if generation to a large extent is going to be controlled by a public authority, the Board, if two-thirds of the retailing industry is already in public hands, why should there be this great fear of nationalising the industry when already two-thirds, as regards generation, transmission and distribution, is already in public hands and only one-third is left? Why not make a clean job of the matter? It is when we come to the contrast between publicly owned undertakings and company undertakings that we see where this Bill fails. While provision is made for the passing on of the advantages of cheap current from the bulk supplier to the authorised undertaker, there is no adequate provision made that this advantage shall reach the consumer. In the case of local authorities we are careful, in the Schedule, to see that the benefits of the reduced costs of electricity should go to the consumers, and should not be raided for other purposes, but that is not done in the case of companies. We are careful to see that municipalities gradually pay off their capital indebtedness but the difference in the case of companies is enormous. I will give one instance. In the case of a particular municipal undertaking in London, it has paid off something like one-third or one-fourth of its capital indebtedness, has reduced its capital charges, and thereby enormously reduced the cost to the consumer. But we have had recent Bills passed through this House giving extended tenure to London companies, the immediate effect of which has been a great rise in the shares of those companies. Increased dividends the distribution of reserves, piled up at the expense of the consumers, by giving bonus shares, the increasing of capital, have increased the overhead costs that have to be found by the consumers in that area, and without any reduction in price. There you have exactly the difference. I can quite understand the Government hesitating to interfere with this very fruitful field. I can quite understand the North-east coast not wishing to be interfered with. The hon. Member for Hampstead (Mr. Balfour) thought it was because they were so efficient. I say it is because they are so rich: they have such a rich field that naturally they do not want to be interfered with.

That is the first big failure in this Bill. Secondly, we come to the method. The method is extraordinarily clumsy, extraordinarily intricate and extraordinarily involved. We are setting up a Board. We do not know how that Board will be composed. It is absolutely a leap in the Clark as to what the Board will do. We have objected on this side, and it has been taken that our objection was because we were in love with some bureaucratic method directed from Whitehall. We do not pin ourselves down to any particular form of nationalisation, any particular form of organisation of industry. Indeed, we know perfectly well that the various forms of industry in this country must have a separate and distinct organisation according to their needs. This Conservative method may have great merits. The principle is adopted in the Broadcasting Bill that is to come before us next week. It, is essentially a Conservative method of bringing in what Socialists have proved must be done, in the form of setting up a non-profit-making corporation. It is, perhaps, natural to a party that has autocratic traditions. But we on this side are more democratic and prefer things to be under the control of the people through this House.

The proposed Board is a very clumsy way of doing it. A great deal of our trouble, when the Bill was in Committee, was in trying to work out the exact relationship between the Board and the Government Departments, between the Board and the local authorities, between the Board and the companies, and in providing all sorts of ways and means of getting a correct judgment between the two—arbitration here, reference to an auditor there and so forth. All that is very clumsy. It is all because the Government will not grasp the nettle firmly enough. I do not think they would have been stung much more than they have been. I cannot imagine the obstruction in Committee of the hon. Member for Hampstead and his friends would have been more effective if there had been a clean Bill for nationalisation. The hon. Member and his friends did their best. That is the failure with regard to the method.

There is another very grave fault in this Bill. That is in the objective of the Bill. The Bill takes the whole electrical problem as if it were merely a commercial problem, and the setting up of the Board is just an example of the Government's idea of this as essentially a business and commercial problem. It is to be a business Board. To us electricity is primarily a great social question. We want the direction and the supply of electricity, the policy of the supply of electricity, to be determined on the broadest possible lines of social well being. This Board has certainly the power of correlating separate undertakings, of correlating generation and main transmission. It can, therefore, send a flow of cheap and abundant electricity throughout the country into the hands of various undertakers. But it is precisely at that point that protection of the community fails. A municipality develops its electricity supply in the interests of the community. A company develops it where it best sees the chance of profit.

Let me give one instance. It will be found that the greatest developments of electrical power for household purposes, which is particularly desirable, is by the municipalities. I happen to be a member of a local authority undertaking. We supply very cheap power. I live in a company area, and I find that the price for domestic power there is nearly six times what has to be paid in the municipal area. It is not to the company's interest to provide cheap power for the domestic house, or they do not think it a particularly profitable line, and, therefore, they do not trouble themselves about developing domestic supplies. I notice a little murmur as if that statement were regarded as untrue.

Lieut.-Colonel Sir FREDERICK HALL

Is the House to understand that the price of power charged by the municipality to which the hon. Member refers is one-sixth of the price charged in the locality where he lives?

Mr. ATTLEE

The price of power is something like one-sixth. The price of power in our own case is 2d. for the first 60 hours of maximum demand, and after that one-halfpenny with a considerable reduction up to 17 per cent. for large consumers. The price I pay to the company is 3d. The price for lighting by the company is 6d. and than of the municipality 4d., with a reduction to ld. after the first 60 hours maximum demand. If the hon. Member prefers it, I will say that the price is only four times as high as in the municipality. The point is precisely the same. I am not charging any hon. Member with any moral obliquity.

Major PRICE

Will the hon. Member compare the areas and the number of consumers in both eases?

Mr. ATTLEE

The company area is a great deal larger than the municipal area.

Major PRICE

And the consumers?

Mr. ATTLEE

The consumers are more numerous.

Major PRICE

Per acre?

Mr. ATTLEE

I agree that there is a difference there. I am not attempting to make that point. As a matter of fact this state of things can be found in other areas. For the whole of London we had an inquiry made by very eminent engineers, and the result abundantly bears out that view. I do not say that mine is not an extreme case, but on the whole there is no doubt at all that in London the prices are more than half as great again in company areas than in municipal. Of course, the company directors duty is to their shareholders. They have to put their shareholders first. Our point is that it is quite impossible to get these social and national results, which are required from electricity, as long as it is in the hands of people whose prime objective is not to help the community but to make profits for their shareholders. In that particular organisation the shareholders would be justified in calling the directors over the coals if they did not get a profit.

Our point, briefly, is that electricity is one of the master keys of the future. We do not want that master key to be left in the hands of people whose main interest is profit. The surprising thing in this House is that, while we get people who recognise the social considerations which I have mentioned, we never get one of our captains of industry to realise the advantages of a public supply against a private supply. It is never expressed in this House, but it is expressed outside pretty frequently, because there are plenty of Conservatives or of strong anti-Socialists who rejoice, seemingly, in having a cheap and abundant supply of electricity, and who, as a matter of fact, run their undertakings on very sound lines. They are municipal Socialists, only they do not like to call themselves so. But we can never get the big business man to recognise, as I should have thought he would recognise, that just as it is an advantage to have communal roads so it would be an advantage to have electricity kept out of the hands of the profit makers. The Government view does not go our way far enough. It touches on it at one or two points, but when it reaches the question of private profit it veers off. This Bill is a Bill for providing a cheap and abundant supply of an article to the retailers, and the retailers are left almost entirely free. Of course, there are some provisions in Clause 30 on that point, but I do not believe any of those sliding scale revision of prices schemes are really effective. Our experience up to now has been that they are wholly illusory.

One further point. This Bill has treated as a separate matter the organisation of this industry. We believe that, in the times in which we are living, it is necessary to consider all these matters on the very broadest possible lines. We do not believe in segregating the matter of electricity from other problems of the provision of light and power; therefore, we have included in our Amendment that one of our objections to the Bill is that it does not go far enough, and is not comprehensive enough. We believe that the right line is the Socialist line. We believe that in this Bill the Government have been forced by the economic conditions of this industry to recognise the force, of the Socialist indictment, and we believe that the only reason why the Socialist solution has not been adopted is because it is impossible for a Conservative Minister to carry out those things which he knows are right, because he is up against what was once described by the present Chancellor of the Exchequer as a conspiracy of interests which will always defeat him.

Mr. MONTAGUE

I beg to second the Amendment.

12.0 N.

I agree with the Mover that this Bill does not go far enough, and that it does not touch the fundamental aspects of the problem of providing a cheap and full supply of electrical power for this country. It is generally understood that the proposals embodied in this Bill originated in a committee of experts. I submit that the proposals of the Bill did not originate with the committee of experts at all, and that the Bill is not the product of the Weir Committee, as has been suggested. The Weir Committee, in fact never considered the fundamental question of power supply to this country, but only dealt with the financial and technical considerations applying to certain proposals placed before it by a Government official. This scheme originated with Sir John Snell. He is a highly-honoured and highly-expert official of the Ministry of Transport and this scheme originated with him, according to his own statement in an address to the British Association for the Advancement of Science. It is in all essentials a scheme imposed by the Ministry of Transport upon the Weir Committee, and is not the independent product of that committee or of any body of electricity or power experts in this country. The fundamental principle in the Bill is thoroughly unsound. As the Mover of the Amendment has said, it concentrates the supply of electricity and the organisation of that supply upon the distributive end alone, simply because that is the end where the profit is to be found. That explains why the Weir Committee were not allowed to consider fundamental questions and only applied themselves to the consideration of how to carry out financially and technically the proposals of the Ministry of Transport. The Ministry and the Government are more concerned with the interests of those who have a vested monopoly in the supply of electricity, and that is why the consideration of the whole question has been centred upon the supply of power in areas contiguous to the places where the greater amount of power supply is required, that is to say, the distributive centres.

I hold that the Bill is fundamentally wrong because, without going further than the mere prima facie aspect of the case, it is obviously cheaper and more efficient to supply electrical power from the areas where it is originally obtained and transmit it by means of cables, than it is for the power to be produced some-where else on the basis of an expensive supply of coal carried by ordinary physical means from the coalfields to the distributive centres. In other words, from a practical point of view, it should be obvious that the right place in which to produce electrical power is in the coalfields and not in areas contiguous to large cities and towns with all the added congestion and smoke and filth that would be implied by these huge super power stations. That consideration involves the whole question of the super power station. Now there is no virtue in mere bigness. We have to consider whether it is not much better to build moderate-sized power stations in the coalfields, rather than huge super power stations in the areas around big cities and distributive centres. The objection is that it is not so easy to get a plentiful supply of water for the steam-heating necessary in the technical processes of producing electricity on a large scale. I do not know how much there is in that objection. I am not a technical expert, but I suggest that it should not be so difficult to get an abundant supply of water for moderate-sized stations.

We have to consider the question of whether we could not save more nationally by having moderate sized stations in the coalfields and regulating the "grid" upon that basis, than by having a smaller number of huge super power stations nearer to the areas of supply. The figures that I have, which I give for what they are worth—I have done my best to find some expert evidence on the subject —show that economy in the generation of 35,000 kilowatt generators instead of 1,500 kilowatt is less than 1 lb. steam pressure per kilowatt, whereas the economy obtained from coal by generation at the pithead is from 30 to 40 per cent. larger, leaving an ample margin for the extra cost of transmission. I suggest that the only reason why this scheme has been imposed on the Weir Committee, coming as it does entirely from Sir John Snell, which means that it comes from the Ministry of Transport, is that it is a political dodge or attempt on the part of the Government to serve the interests of the profitmongers, which concentrate upon the areas of distribution more than they do upon the areas of supply; and I suggest that, in agreement with the conclusions of the World Power Conference held at Wembley, it was established that the principal aim should be generation at the source of power. It is in that respect that I regard this Measure as fundamentally unsound.

There is one other consideration that ought to loom very large in the minds of Members of this House at the present moment, and that is as to what would be the effect on the coal industry itself of concentrating the production of electricity upon the coalfield areas at the present time. You would be able automatically to carry out the principle of unification if you did that, and you would be able to utilise classes of coal which are not profitable in the ordinary way of trade, especially export trade. Those classes of coal could be used at the pithead or in the coalfield areas, whereas it would be far too expensive to carry it to the huge generating stations round about the distributing areas. For that reason as well, I oppose the Bill and support the Amendment. The Bill is fundamentally unsound, simply because the Government, while, they are forced to consider this question of the power supply, not in the interests of Socialism—it is not a question of Socialism, but a question of business—are at the same time very much concerned about the interests of their friends, whose profit is concentrated, as the Mover of the Amendment said, more in the distributive than in the productive areas.

Sir JOSEPH NALL

If I do not follow the last two speakers, I hope the House will forgive me in opening what I have, to say with one or two observations which it appears to Me it is only fair and right that I should have the opportunity of making. This Bill has raised a controversy on principles affecting a vastly wider field than the immediate object of the Bill, and its passage through the House, particularly through Committee upstairs has raised again the question of the rights of minorities to criticise proposals, and especially the rights of private Members to criticise proposals emanating from their own side of the House. I make no complaint of the attitude of the Minister of Transport and his Parliamentary Secretary, or indeed of their Department, in these proceedings or in any manner relating to any observations that I have made on the Bill. But I object very strongly to the manner in which the Attorney-General has seen fit to deal with Members of his own ride who have ventured to criticise the proposals in this Measure. It has remained for him to indicate his contempt for criticisms from his own side of the House, by receiving our observations in many instances with an obvious impatience and an unexampled discourtesy, to which I take the very strongest possible objection.

The proceedings upstairs have indicated once again how impossible it is to deal with matters affecting details of this kind by the cumbersome procedure of a Standing Committee. How very much more effective and useful, and how much more expeditious, it would have been had this Measure been examined in the more impartial atmosphere of a Select Committee, where the many points would have been discussed and considered with that proper regard for justice and fairness, which is not always observable in the political battles in Standing Committee. While it would be out of order to discuss in detail that aspect of the matter, I would like to place on record, in passing, that this Bill once more emphasises the need for some change in our procedure on Bills of this kind, as I think you, Mr. Speaker, yourself suggested to a Committee some years ago, when dealing with the method of procedure on Public Bills.

The Attorney-General has seen tit to carry his method of personal attack outside this House. In a speech in his constituency he referred to a letter of mine in the public Press, of which, I take it. I am perfectly at liberty to make use, and he observed that the statements in that letter of mine were in every respect contrary to the facts. I hope that, when the Attorney-General comes to reply, he will indicate in what way those statements are contrary to the facts, and it is only fair that I should hoot, a to the House what I said about the Bill on that occasion. I wrote: The Bill proposes to give a Board of eight men, appointed by the Minister of Transport, the following wide powers: To take control of any generating station it chooses and to close down any it considers uneconomic; To order any undertaking to incur capital expenditure to extend its activities and increase its plant and commitments; To regulate the hours and conditions of supply of any undertaking; To compel all undertakings to sell all their supply at cost prices to the Board; To compel each undertaking to buy back its own supply at cast price, plus the Board's administration charges; To borrow £33,500,000 now and more later in the name of the State, in order to erect main transmission lines across the country; To inter-connect power stations with districts in such a way that the Board will compete in some cases with the very undertakings it controls. The question of responsibility is the first that arises. But this Board of Bureaucrats will not be directly responsible to Parliament. It will not he financially responsible either to the State or to the industry it controls. And against the commands of the Board and the decisions of the Electricity Commissioners in major matters there is no appeal, either to Courts of Law or to Parliament. The claim of the backers of the Electricity Bill is that by 1940 electric power (not light) will he available at a penny a unlit all over the country through the Board's efforts. But a quarter of to-day's supply averages less than a penny, and by 1940, provided there is no State interference, the figure will be about a half-penny. Experts have examined the Measure from every aspect. By adding to the cost of power, through useless administrative charges, it will hamstring industry at a moment when Britain is fighting hard to keep her lead. Those are the observations I made, which the Attorney-General said in several respects are contrary to the facts. I would venture to say that several of them have been already endorsed by the Parliamentary Secretary in this Debate. Unfortunately, owing to the exigencies of debate, I was not able to make the observations I would have liked to make on Second Reading, but I did interject on that occasion that certain figures in the Weir Report were deliberately misleading. The Attorney-General strongly objected to that observation, and said it ought to have been made in debate; wherefore I crave leave to make it now. I say again, that certain of the figures in the Weir Report, which has been produced as the excuse for this Measure, are deliberately misleading, and I will say why. In the Report, Table 2, figures of the consumption of electricity in various countries are given. It begins with the grand display of 1,200 units per head of the population in California. It tails down by quoting the two independent towns of Sydney, with 161, and Shanghai with 145, and then deliberately discredits the figure for Great Britain at 110, at the bottom of the list. That, I say, is deliberately to mislead people. Of the 11 countries and towns cited for comparison no less than six of them—California, Canada, Switzerland, Tasmania, Norway and Sweden—obtain the bulk of their electrical energy from water power. In the United States, which is quoted, as a whole, water power, such as Niagara, plays a quite important part in the production of electricity. In the case of Tasmania, which is quoted against this country, the supply is pro- vided by the Tasmanian Hydro-Electric Department. The bulk of that supply is used by one consumer—the Electrolytic Zinc Company, and when you have taken off their supply the average of the consumption is only 130 units, as against the figure quoted in the Weir Report of 550.

Then, it is sought to draw a comparison between Great Britain as a whole with certain towns such as Chicago, Sydney and Shanghai. That is obviously unfair. This country, embracing a territory of some 88,000 square miles, the greater part of which is sparsely populated, is compared in that table with densely populated towns. The figure of 110 units of the authorised undertakings per head of the population in Great Britain is the average consumption sold by authorised undertakers in the year 1923. This figure for Chicago, quoted in the same table in comparison with this country, is stated at 1,000 units, but in 1923 the actual figure in Chicago was under 800. So that the figure for Chicago in the Weir Report is actually 20 per cent. wrong, if it be compared with the figures of Great Britain quoted in the same table. The actual consumption of electricity, even in the year 1925, was 6½ per cent. less than the figure quoted in Table 2.

Another illustration which I should like to quote as indicating the misleading character of Table 2 is that, while it quotes these two or three towns in other parts of the world, it does not quote any English towns. Why does it not quote any English towns? Because to do so would indicate the failure of that table. It shows the deliberate unfairness with which it is compiled. Take representative and independent English towns—Liverpool with 164, Hull, Birmingham, Glasgow, Leeds, up to Manchester with 250, Sheffield, 294, Luton, not a great place, 334; Coventry, 380, Maidstone in the middle of the Garden of England, 390; Rotherham, 541. They are not even the best, because the municipal borough of Wallsend-on-Tyne in Northumberland showed in 1925, a year of depressed trade a consumption exceeding 1,580 units per head, that is, over 30 per cent. above the average for California, and nearly 60 per cent. over the average for Chicago in the same year.

I think that indicates I was perfectly justified in interjecting on Second Reading, and in repeating now, that Table 2 in the Weir Report, which is being extensively used by the propagandists in favour of this Bill, is deliberately misleading, and that in these figures in the Weir Report no comparison is made of the real "energy consumption" per head of population. It only quotes the "electrical energy consumed." In this country, in industrial districts close to coalfields, the supply of coal for steam power is one of our greatest assets. The development of the gas supply is one of our great national assets. In Lancashire to-day, where there is a cheap supply of electricity, the great bulk of the mills are not electrically equipped. I have a letter here from the head of one of the greatest engineering organisations in Lancashire, in which he says that, "If you were to give us our power free, it would not offset the cost of changing over our equipment from the present private supply which we generate for ourselves."

If the energy consumed per head in the form of gas and electricity combined be compared, the figures are very different. Now let mo give an example from America, about which some of our enthusiasts are very ready to give figures. Compare Boston and Chicago. In 40 years the population of Chicago has increased by 500 per cent.; that of Boston has only increased by 100 per cent. In 1925 the consumption of electricity Per head of population in Chicago was 935 units, and in Boston 380. So that to-day the consumption per head of population in Chicago, the more modern, the more rapidly growing city, is about 2½, times as great as it is in Boston, the older and slower growing city. And yet throughout, in the Weir Report, the rapidly growing new cities and new countries are compared with the older, and, in some respects, less rapidly extending Great Britain. There are many other figures in the Weir Report to serve the purpose for which the Report is presented. The Incorporated Municipal Electrical Association, in a resolution, the whole of which I may, perhaps, quote in order to place it on record, says: having considered the proposals of the Bill, believe that in its present form it will not attain the object for which it is being promoted. That is, cheaper electricity to consumers, leading to its more widespread use: The proposals of the Bill are too cumbersome as well as costly and unworkable, and the Association considers that before any legislation is proceeded with, representatives appointed by the electricity supply industry should be consulted and given an opportunity of submitting proposals as to the most satisfactory manner of effecting any desired improvement; and the Association further is of the opinion that the figures in and the conclusions of the Weir Report are open to serious doubt, and also deprecates the suppression of the Merz Report and the undue haste with which the Government has pressed the scheme. That is the opinion of the Incorporated Municipal Electrical Association. Since the Weir Report was published we have had some more information from the Commissioners. The Weir Report recommends certain things and expenditure, and the Government propose to guarantee £33,500,000. [An HON. MEMBER "For a start."] For a start. It is significant that in the latest report of the Commissioners issued since the publication of the Weir Report, practically that sum has, in fact, been expended in the further development of the industry. The Weir Report puts the present capacity of the plant in this country at 3,096,000 kilowatts, but the figure for the end of the year 1924–25, according to the Commissioners latest report, was 3,723,000 kilowatts, an addition in two years of 629,000 kilowatts, Or one-fifth of the whole. That has been done in two years by an industry which, according to the Government, is so laggard and so much behind that it must be spoon-fed in the manner provided in this Bill. If we take the year 1021–22 as a basis, we find that at the end of the year 1924-25 there had been an increase of 71 per cent. in the units sold for lighting and domestic purposes, and of nearly 68 per cent. for power services, notwithstanding that normal trade conditions have not been restored. My hon. Friend the Parliamentary Secretary said this Bill must be passed at once, that delay would prevent its being passed. There would be such great progress without the Bill, I take it, that there would he no shadow of justification for it if it were not passed at the present juncture.

Lieut.-Colonel MOORE-BRABAZON

I was speaking in regard to the standardisation of frequency, and what might happen if you go past a certain time. America bitterly regrets that they have passed that particular time.

Sir J. NALL

There is no proposal to standardise the existing two frequencies in America into one, nor has it been shown that any economic advantage would accrue from such a change. My hon. Friend himself, in his very lucid speech, one of the most lucid speeches we have had on this Bill, indicated that what the Bill desires to do is to adopt the most excellent system on the northeast coast. It is curious that one of the first things the Bill proposes is to upset that area by changing the frequency and giving the Board arbitrary powers to select two or three stations and upset the whole balance of that area.

I am accused of overstating the case against this Bill because I called it Socialism and Nationalisation. If the country had not been preoccupied in these recent months with the overwhelming shadow of the coal dispute, if, indeed, this Bill had been under consideration when the Samuel Commission was sitting on the coal question, I think the political principles embodied in the Bill would have received a good deal mare attention, and the real principles behind it would, perhaps, have been more manifest to the average man. I would recommend anybody who doubts the political principles behind this Bill to read chapter 6 of the Samuel Commission's Report, because that deals with the proposals which the Miners' Federation made to the Samuel Commission for the national control—so-called nationalisation—of the coal industry. They proposed to establish, first, a Power and Transport Commission under the general supervision of the Board of Trade. Let me quote the functions which it was proposed that Commission should undertake: (a) To survey the problems of power and transport development as regards both needs and possibilities. (b) To undertake and administer the inter-connection of generating stations and the trunk line transmission of power. (c) To lay down conditions governing power and transport undertakings, both public and private. (d) To co-operate with the Department of Industrial and Scientific Research in the promotion of research into power production and coal by products and kindred questions. (e) To undertake or to arrange for the commercial application of the results of research into power and transport problems. One Board, or Commission, was to be set up for the coal industry under the miners' proposals, and there was to be another, a National Coal and Power Production Council, under the presidency of the Secretary for Mines or his Deputy. They were to consist—it is only a suggestion—of six executive and administrative officials—not eight—elected by their respective organisations, and six miners and by-products workers similarly elected, and two representatives of the Power and Transport Commission. Expert officials were to sit with them in an advisory capacity. They would be the body that would be charged with the actual conduct of the mining industry. Yet I am told there is no similarity between the Board which will be charged with the actual conduct of the electricity generating industry and this proposal of the Miners' Federation to take charge of the actual conduct of the mining industry. I do not think I need say much more to impress upon the House the similarity between the proposals made by the Miners' Federation for the coal industry, which were turned down by the Samuel Commission, and were, in consequence, automatically turned down by the Government when they said they were willing to adopt that Report. Here we have the same skeleton scheme of a Board, or central body, with a State guarantee, and with arbitrary powers of interference with those who are already conducting the industry. It is argued, my hon. Friend the Parliamentary Secretary argued it again to-day, that the creation of a grid is necessary for our electrical development. One would gather from the utterances of some of the chief supporters that this kind of rigid grid is in operation in European countries, although I believe since the production of this Bill they have run away from the idea that such a grid exists in America. As Mr. Sam Insull told some Members of the House, what is called "loose linking" is really the system in America. We have enthusiasts who say that there are rigid grids in Germany and that they exist elsewhere. The only example of a rigid grid is in France, where the Government have set up a system in one of the devastated areas around Lens, Bethune and Valenciennes, but there is nothing of the kind in Germany. There the big transmission system is necessary because the origin of the power is not in the vicinity of the industries that need the power, and therefore these large transmission systems have been erected to convey the power.

An hon. Member opposite has referred to the transmission of power in certain circumstances which can be derived from some natural source, and he says that this is better done by electricity than having to transport the fuel which is the origin of the power. That applies to Germany, where the power has to be transmitted to where it is wanted, and that does not exist in this country. Here it is cheaper to transport the coal than to transmit the electricity, but that is not the case under the German system, nor is it the case in Italy, where vast water resources are linked up by huge transmission lines with the industrial towns where the power is required. I say again I am advised by those who have inspected these systems that there is nothing of the kind in those countries in any way representing the rigid grid of which the Parliamentary Secretary spoke. The cheapest power does not necessarily come from the largest stations, and in this country some of the smallest stations give extremely good figures. I referred to the fact that in Luton a quite respectable figure of units per head of the population can he shown, and the total works cost is quoted as 65 of a penny per unit with a maximum load of 10,200 kilowatts, whilst. Manchester with its large and efficient super-station shows 64d. with a maximum load of 136,000 kilowatts. There is nothing in the nature of a grid at Luton, but there is something in the nature of a grid in Manchester, which is interlinked with other authorities, and a certain economy results in consequence. But in spite of this, the figures are not materially different.

My objection to this Bill, apart from the Socialistic and nationalisation tendencies upon which it is based, can be summed up under certain definite headings. I do not believe in the principle behind the Bill, but before I come to those definite headings I would like to say that all through, as has been argued from the other side of the House, the Bill only touches the least thorny of the problems relating to electricity supply, and it makes no effort whatever to deal with the great disadvantages and the many impediments which stand in the way of the distributor and the details affecting the consumers of the country. This Bill does not attempt to face those difficulties, and it deals only with the simple and efficient side of electricity supply, that of generation. As I indicated just now, in many cases the great users of power would not be able to use electricity if you gave them the current for nothing because the change over in their plant which they would have to face would cost more than any saving which you could give them in the cost of electricity.

Taking the Bill, however, as a Measure which we know is to proceed, and which the Government is determined to push through before the development of the industry makes it too late, let me deal with the principal objections which have been admirably put by commercial bodies such as the Associated Chambers of Commerce, who I believe have frankly and forcibly placed their objections before the Government Department. The first one deals with the constitutional aspect of this Measure. Those hon. Members who have spent much time, as I have, during the last few years listening to the applications of various authorities, municipalities, companies and so on who seek Parliamentary powers to extend their activities, or ask in some way to be specially privileged in the conduct of their operations must have been impressed by what we call the private Bill procedure in this House. Suppose a great municipality desires further powers for the extension of its electricity undertakings, and so on. If it desires anything which infringes upon the ordinary rights of any of the subjects of the Crown then the procedure adopted is well known to this House. Those who object to such powers being given must establish their locus, and having done so they are allowed to state their case, and we have small Committees of this House which are as impartial as it is possible to obtain; they hear the case and as a result they generally arrive at a decision which, generally speaking, gives satisfaction to the parties concerned.

One of the chief objections we have to raise to the structure of this Bill is that it is contrary to the announcement made in the Prime Minister's speech at Birmingham in which he said that public authorities have no right to interfere with the ordinary liberties of the subject. They have no such statutory right in their constitution. They have no right to interfere with any other undertaking or corporation or body of individuals who in the course of time may find it necessary to come to terms with, or to absorb, or in some way to interfere with. Such bodies have to come here for statutory authority to do anything of that kind, and when those people have established their locus they have a right to come here to be heard. That is the principle which is supposed to be established in the precedent quoted by the Prime Minister, and yet this Board will have a statutory right under the schemes adopted under Clause 4 of this Bill to interfere, within the limits of the Bill, with the existing rights and statutory obligations of municipalities, corporations and individuals, and those parties who will he affected have no right to be heard except in a very limited number of cases where they will have to show that they will suffer some pecuniary loss, and we have heard on the Report stage that if the respondent Board say that the admission of the appellant's claim would prejudicially affect the efficiency of the scheme then the Court is thereupon hound to find in favour of the respondent. Board, except as regards a money payment. That has never before, so far as I have been able to find out, been suggested in any legislative proposal ever submitted to this House by any of the parties or by anybody outside, and I say that in that respect the powers which are vested in this Board under the provisions of this Bill constitute one of the greatest attacks upon the historic rights of His Majesty's subjects ever laid before Parliament; and it is an absolute scandal that upon such a ease we have not had the guidance that one would have expected from the Law Officers of the Crown, who, instead of performing their traditional duty of advising the House as to the effect of proposed legislation upon the rights of His Majesty's subjects have in the person of the Attorney-General been content to play the lesser role of advocate for the Department.

The second point of objection to this Bill, which has not been met but which is of importance as touching the details of the Measure, is that the owners of efficient electrical undertakings should be permitted to go on supplying their own consumers without interference. When that question was raised on the Report stage, the Attorney-General said that it would upset the whole scheme of the Bill. There is no need to upset the whole scheme of the Bill. If the object of the Board is to supply energy in areas where at present it is not supplied or to supply energy more cheaply than it is at present supplied, they could, under the scheme of the Bill, require a selected station to supply them with such energy as they wanted, and, if they take and control the whole supply of an electrical station, they must, first of all, have regard to the needs of the owner of that station and let him have back again such quantity as he needs. It is only in those stations which can be called uneconomic and which ought to be unselected where the need for closing down arises. So far as the selected stations are concerned—so far as I can see the case—there can be no argument in support of this principle that they are to stop and start at the orders of a central authority up here in London. They ought in the case of the great municipalities and the great companies to be allowed to run their own undertakings to meet their own needs while being subject to the provision that they should supply the Board with such energy as the Board needs.

The third very important point is that there should be no burden placed on the industrial areas on account of the unprofitable areas. That was discussed on the Report stage, and the Attorney-General did not try to meet the arguments that had been put up. He rode off on that Amendment and said that the electricity districts constituted under the Act of 1919 might not be convenient zones for the application of a tariff. If the words which we suggested were wrong, presumably the zone of the scheme under the Bill will be a convenient area for the operation of a tariff, and, if an electricity district under the Act, of 1919 does not coincide with the scheme under the Bill, then either the tariff would apply to the zone of the scheme or the district could be altered to coincide with the scheme. Words have been added to the Bill to deal with areas and parts of areas. The same could apply to the operation of a tariff.

The Attorney-General made a very significant comment on that question. He said that of course, under the permissive powers of the Bill, the Board will be able to adopt different tariffs for different areas, but he hoped that in time—I am not quoting the exact words—there will be more or less the same tariff for the whole of the country. He hoped that as the years go on there will he more or less a general tariff for the whole of the country. If either the Attorney-General or the Weir Report is wrong, then my case will be disproved, but if both of them are right then my case is absolutely overwhelming. The Weir Report estimates that with a 35 per cent. load factor and 500 units per head of population, which they hope to achieve in 1940, the station operating costs would be for Scotland 313d. and for Central England 314d.; that is with a load factor of 35 per cent. and coal at 16s. The cost by 1940 will have to be adjusted. In South East Lancashire to-day, with coal at 17s. 3d., a load factor of 30 per cent., and 250 units per head of population, the cost is 2956d. for the district as distinct from individual stations in the district. That district has 19 authorities in it. Eleven of them own stations.

That is one of the things which has been ignored in the answers so far given to the arguments on this case. If a district of that kind, when treated as an entity either for the purpose of the Board or for its own individual purpose, is able to show progressive reductions in the cost of production, the Bill says, as was again quoted this morning, that the owners of selected stations are not to pay more than they would have paid if they had continued to operate the station by themselves. But the Bill does not say that if in a district a concentration of stations would show an advantage they shall have the benefit of that advantage, and that is the case for a separate tariff in the industrial areas. In the industrial areas the developed districts are showing a progressive economy which under the operation of the Bill the Board will not be under any obligation to allow that area to enjoy. They can, as the Attorney-General says, as the years go by get nearer to a general rate for the whole country. So, while we have some safeguard in the Bill against the cost of selected stations being increased, we have no guarantee that in these economical districts we can have the advantage of our own economy accruing from our own development. Therefore, I say the Bill as it stands on this point threatens—human nature being as it is, the Board is only likely to take this view—to relieve the Board of any obligation to let the consumers in a particular district have the economy which is their lust doe. They may keep the price up o that in 1940 they can justify these figures of the Weir Report which over the whole country are higher than the present costs in the efficient districts. We have had no answer to that.

The fourth point emphasised is this question of the standardisation of frequency. The Weir Report itself admitted that the industry could not be reasonably asked to pay for it, that it should come from the Exchequer. The Parliamentary Secretary to the Ministry of Transport this morning emphasised the great development and wonderful efficiency of the north-east coast, yet in the same speech he says these nonstandard areas must be converted, and the 42 frequency of the north-east coast is to be upset. There is no need for that. If interconnection between this area and any adjacent area is necessary, it is vastly cheaper to instal the necessary frequency changes than to convert the whole area. The same applies to Birmingham and to Glasgow. It is much cheaper to instal the necessary frequency changes at the boundary than to convert the whole area. The only case for standardisation of frequency that is made is where small undertakings are at variance with their larger neighbours. I have already quoted the case of the South East Lancashire district, where we see that only 5 per cent. of the total production comes from the non-standard undertakings in the district, and the district, given its own autonomous tariff and free from the liability to contribute to the Board's extravagances elsewhere in the country, can well afford to pay for its own standardisation. Those are the principal objections pressed against the actual scheme of the Bill. They have not been met. The Law Officers of the Crown have refused to face the constitutional issue, and prefer to advise the House to grant these autocratic powers to a semi-departmental Board, an annex of the Ministry of Transport. We are told that this setting up of the grid and this elimination of the smaller stations is following the example of other countries. It is a curious thing that our number of generating stations, quoted in different figures according to whether private stations are included or not, put at the worst, amounts to 584. America with three times the population has got 10 times the number of central generating stations. Even in Germany, that we hear so much about in these Debates, they have got over 3,000 generating plants.

1.0 P. M.

In every country which can be in any way compared the same tale results. In Belgium nearly 800, in Switzerland 330, in Sweden 700. Norway with all its water resources available has many small stations. They have no fewer than 2,500. There is absolutely nothing in this argument about a redundancy of generating stations in this country so far as it is the excuse for the present Bill. The process of closing down uneconomic stations has gone on rapidly, and is going on rapidly in this country, and in certain areas it would be more rapid still if the Commissioners, instead of being preoccupied with a political Measure of this kind, had been able to get on with their business of sanctioning the various schemes sent into them. I do not know how anyone can administer a highly technical Department and do their duties properly and at the same time be involved in a purely political controversy. The fact remains that they are so preoccupied, and the result is that they are not able to grant the facilities required in a number of districts to continue this process of closing down uneconomic stations. This Bill, as the Parliamentary Secretary said, now leaves this House to proceed to the other House. He adopted a metaphor which I think is rather unfortunate. He referred to this ship sliding down the slipway and being launched. I think that would be more applicable to the ship of State because it is the ship of State now being launched on the slippery slope of Socialist national control, which is the twin brother of national ownership. It is useless to attempt to disguise the enthusiasm which has been manifest on the benches opposite for this Bill. In spite of this Amendment and the Amendment on the Second Reading, which were obviously put down as camouflage to cover the real feelings of the party opposite and to help the Government, I need only remind hon. Members that the real feeling of the party opposite was quoted emphatically by the Leader of the Opposition when he said: The Electricity Bill will be found to be, not only for itself, hut for its beginnings and its effects, one of the most substantial advances in the direction of Socialism. And I laugh and laugh, every time I see a. Tory supporting it.

Sir PHILIP DAWSON

It would be quite impossible for me in the short time at my disposal to attempt to answer the large number of arguments which the hon. Member for Rubric (Sir J. Nall) has brought against this Bill. In looking at him I feel somewhat in the position of Isaac, when he said that the hands were the hands of Esau, but the voice was the voice of Jacob. It was a voice that we shall probably hear later on in the discussion. There was a point that struck me when the hon. Member compared two things that were utterly different. He compared the statement made by the Parliamentary Secretary to the Ministry of Transport that a lower average price would be produced in the country than is existing at the present time, and said that that was higher than the present price of an efficient, district. That is one of the reasons for the Bill, which is brought forward so that those who pay much higher prices in certain districts shall benefit by lower tariffs. I myself have, to pay 6d. a unit for light, while only a few streets away my neighbours pay 3d. a unit for the same commodity. That ought not to be, and I think this Bill will help to remedy that position. My hon. Friend talked of a loose grid, or loose connection, and suggested that that was something quite different from what would be carried nut if this Bill becomes law. It may be a different wording, but there is no difference in fact; the result would be exactly the same.

As regards the suggestion that such an arrangement is not in existence in other countries, I do not agree with my hon. Friend. I can give the House one example of an area of over 8,000 square miles in Germany—the Rhine, Westphalia and Hanover. There you have three large independent power companies, some smaller ones, and various municipal authorities, and the system there works at 100,000 volts, with overhead transmission connecting 40 stations. That results in a great economy. The same thing is to be found in the United States of America. As I read this Bill, it is not contemplated, nor would it be possible, that, as a result of the Bill, the whole of this country would immediately be covered with a series of transmission lines which would connect the whole of the various stations of the country. My hon. Friend the Parliamentary Secretary referred to the North-east Coast. That is a very good example, but the area is far too small. It is only about 1,400 square miles. I have no doubt that, if they had a very much larger area, the benefits would be much greater to that larger area than is the case to-day in the smaller one. That is what this Bill will bring about; it will bring about the coordination and interconnection of the various stations in this country, with the result that there will be a reduction in the cost of production.

My hon. Friend said that all experts are agreed that the suggestions in this Bill will not bring about the desired result. I venture to differ from him. Are Messrs. Merz and McLellan, the well-known consulting engineers who went into the whole scheme—are they not experts whose opinion is worthy of attention? Again, Messrs. Kennedy and Donkin, who are also well-known engineers, have gone into the whole scheme. Are they people whose opinion is not worthy of consideration? When we consider the whole position, let us recollect that it took a very considerable time to investigate, and that amongst those who investigated the advantages which would be gained by the proposals of this Bill were such men as Mr. Page, who has been chief engineer to the Clyde Valley Company, and who is to-day no longer a commissioner, because private industry has thought so much of him that he has now been engaged to occupy a very high position in the electrical industry in London. Again, take another man like Mr. Lackie, who was chief engineer to the Glasgow Corporation, and was responsible for one of the most efficient stations in existence to-day, the Dalmarnock Station. When these engineers go into the figures and proposals submitted by the consultants to whom I have just referred, and are heartily in agreement with them, I ask, is it likely that there is anything very wrong with the suggestions?

If you look at the various industrial areas of this country, with the exception of the North-east Coast, you will find various undertakers, some municipal, some companies, next door to one another, who absolutely refuse to cooperate, or find some excuse for not doing so. It is an acknowledged fact that the interconnection of power stations will result in a better load factor and higher efficiency, and in a general benefit all round, and it was for that reason that the Act of 1908 was passed, giving facilities for interconnection between various undertakers to help each other. What has been the result According to the latest returns published by the Electricity Commissioners, only something like 7½ per cent. of the total amount of energy used to-day is transmitted in bulk. The need being there, why do people not avail themselves of the facilities granted under that Act? It is because of the inherent individualism which exists in this country. With its many advantages, it sometimes has also some disadvantages.

I am convinced that when this Board is established, and if, as it undoubtedly will, it works in harmony and sympathy with the Electricity Commissioners, there will be no vast organisation to carry out their proposals—all that will be needed will be to go into the various districts and get the engineers of the concerns together. Whether you take Scotland, or the Midlands, or any other large part of Great Britain, I am convinced that it will not be very many weeks before a really good and workable scheme will be forthcoming. The powers of compulsion will result in an agreement being reached without that compulsory power having to be applied. We have had many examples of that. We had the grouping of the railways. I am not going to say here what my view of that grouping is; all that I wish to point out is that one of the most difficult operations, which was said to be utterly impossible, was carried out voluntarily by the various companies, once they knew that, if they did not do it of their own free will, they would be compelled to do so.

With regard to some of the other questions which have been raised by my hon. Friend, I am not going to give any detailed figures for the consumption of energy in other countries, but I can tell him from my own personal experience— and I shall be quite prepared to take him over and show him what is actually being done in other industrial countries —that the general condition in this country as regards the supply of electricity is inferior to that in practically all other industrial countries, and it is no good shirking that issue. Whatever the Weir Report may or may not contain, whatever mistakes there may be in it, the fact remains that our electrification is not carried out to the same extent as in other industrial countries. With regard to the United States of America, there again my hon. Friend made a comparison which is most unfair. He gave us the population, but did not give us the area; but, the area being so much more vast, naturally a certain number of power stations will be required in addition to that which would be exactly proportional to the difference in population. In the United States of America, 68 per cent. of the industries are operated electrically. The figures that were given by my right hon. Friend the Minister of Transport in introducing this Bill on Second Reading showed that, I think, about 34 per cent. of the industries of this country were electrified.

Let us take another example; let us take the coal-mining industry of this country. I cannot tell the House what the actual electrification amounts to, but I can give a very good idea of what it would be if the industry were electrified to the same extent as the coal-mining industry is in Germany. I tried to get some figures, but apparently those figures as regards England are not yet available. If our coal-mining industry were electrified to the same extent that it is in Germany, its consumption would be greater than the total output of all our public utilities last year. That will give you some idea of what it should be, and what undoubtedly it is not to-day. But in connection with the electrification of mines, one of the difficulties to-day is that if each mine of a small group of mines put up a power station, it would cost much more than if they put up a much bigger power station utilising what to-day is practically a waste product, all of which works in entirely with the ideas in the proposals of the Bill. With this Bill in existence, and with transmission lines which they have a right to put in in order to interconnect with the waste heat power stations, we shall see large stations of that kind springing up which will supply the energy required in the mines, and the remainder will be used for the benefit of those owning the mines and those who use electricity for other purposes. My hon. Friend the Member for Hampstead (Mr. Balfour) on the Report Stage referred to mining power stations which to-day were supplying a certain amount of energy to surrounding localities. If a grid of this kind were to be in existence, and if that mine knew that it could sell into that grid the whole of its excess output, I think the difficulty which has arisen in the case referred to by my hon. Friend would disappear.

A suggestion has been made, which, on the face of it, appears an eminently reasonable one, that those stations which are selected should only supply to the Board the excess amount above their requirements at the price of production. There can be no doubt whatever that the price of production at the selected station, because it has become a selected station and for no other reason, would be very much lower than it would be had it remained an independent station supplying only its own requirements, and therefore what my hon. Friend suggested was that Board's expenditure in securing the advantages and benefits which that station got through becominy a selected station, which was paid for by the Board in connection with its transmission lines, should be borne by the Board, but the whole benefit should go to the selected station as far as the amount of current it required for its own purposes was concerned.

Sir J. NALL

I did not say anything of the sort.

Sir P. DAWSON

The question arose yesterday, and that was the proposal, and no alternative proposal was made.

Mr. DENNIS HERBERT

I moved the Amendment, and expressly denied that it involved any such proposal.

Sir P. DAWSON

I can only read into the Amendment what was stated in it, and what was stated in it was that the selected stations should only supply in excess of their requirements at the cost of production if that be correct, what I have just stated is also correct. The question of periodicity has been referred to, and it is suggested that it is entirely unnecessary to standardise that except in the case of a very few stations. That, I think, is absolutely contrary to what would be for the benefit of the country. To-day 75 per cent. of the generating stations are producing at 50 periods, and it is possible to alter the other ones and bring them into line so as to have a uniform periodicity. There is no question that 50 periods is very much more economical than 25 periods. It is admitted by all who have experience and knowledge that the cost of electrical plant and the turbines for 50 periods is something like 15 per cent. cheaper than for 25 periods, that all the auxiliary plant is more or less in a similar condition, and that the cost of production is more economical and the station more efficient with 50 periods than with 25. To-day it is possible to carry out that standardisation. Later on it will never be possible except at a ruinous cost. We had a similar thing to deal with in days gone by when there were various railway gauges and when we had a standard gauge and a broad gauge. I still think if railways had been invented a little later we should probably have had the broad gauge throughout the country. At the same time, notwithstanding that fact, the Great Western Railway, I think one of the most progressive railways anywhere to be found, altered its gauge at a large expenditure and at considerable inconvenience to the travelling public, and brought it to the standard gauge. In talking of standardisation we must recollect that we are a very small country compared with America and other Continents, and therefore it is much easier to do that and much more essential to do it in small and densely populated areas like ours than it would be in the United States. The cost at which this standardisation has been estimated has been questioned. It was prepared by eminent consulting engineers who had great personal experience and knowledge of such work. It was they who were responsible for the installation and working of the North East coast. They did not suggest that to carry out the alteration of frequency in that case would be exceedingly difficult, or impossible. Those same engineers, to my personal knowledge—because I was advising the Glasgow Corporation at that time—made a most complete and thorough investigation in Glasgow, lasting over many months, assisted by the chief engineer of the Glasgow Corporation and the chief engineer of the Clyde Valley, and their figures were checked by two other Scottish engineers who knew the district and the conditions very well indeed. Is it likely that there should be any very great mistake in estimates thus made and thus checked? If we come to the Birmingham area we find exactly the same thing. The estimates were carefully made and they were checked by Mr. Pearce, who had been the engineer for the Manchester Corporation and was responsible for the most efficient station in this country to-day, far more efficient than any other station we have here, and who has naturally a great knowledge of the conditions in the Midlands. There cannot have been any very great mistake in the Estimates with regard to the cost of standardisation in connection with the Midlands. Those gentlemen prepared a complete scheme of how that work should be carried into effect.

As regards the carrying out of such a scheme, it is evident that the proper way to do it is in collaboration with those who own and operate those stations, and is there any reason to doubt that the Board will adopt such a procedure, and that the whole of that work will be caried out by the authorities operating those stations and by committees who will work in conjunction with a new Electricity Board? I can see no difficulty in that direction whatever, nor can anyone else who is anxious to see a scheme of this kind realised. There is another question, which was not referred to by my hon. Friend but which was in that report of the Chambers of Commerce, and that was the question of arbitration. Anyone who looks at the Bill will see that under any conditions in which an authorised undertaker is likely to sustain loss he has a right of appeal to a tribunal, which should give every satisfaction because it is entirely independent of politics, the members being appointed by the Lord Chancellor.

I have dealt with some of the principal points raised by my hon. Friend, and I hope I have shown the House that we cannot be satisfied with the electricity supply as it exists generally all over the country. As one further proof, I might be allowed to quote a statement by Dr. Eccles, President of the Institution of Electrical Engineers, who said: Only one-third of our country is reasonably well supplied, and two-thirds are very badly supplied or have no supply at all. The argument that because certain industrial areas are very well supplied, nothing need be done in order to attempt to improve the condition of supply in other parts of the country, is one which I think this House cannot and will not approve. It has never been suggested in the Bill, nor do I see how it would be possible in any Clauses of the Bill, that any amelioration of the conditions in the other areas outside that one-third would involve a worsening of the conditions of supply inside the industrial areas or those areas where there is an economic and abundant supply. The Bill perfectly well covers all these points. When we remember that there are towns not very far from Westminster where current is being sold at 10d., 11 d. and 1s. per unit, there is a very large difference between that and the halfpenny or one penny at which the industrial areas are fortunate enough to be able to purchase their current. There is a very vast margin of difference, and it will be very largely cut down by the carrying out of the proposals in the scheme of this Bill.

After a most careful investigation of the conditions in this country, after a very thorough study of the Clauses of this Bill, after the alterations which have been introduced in Committee, I am convinced that the Bill will result in a very material improvement in the supply and general use of electricity in this country, and will materially benefit those people who to-day have to pay such outrageous prices or have no electricity at all. It is our business, it is the business of all of us in this House, to do everything we possibly can to improve the conditions in industry in this country and to equip ourselves better for that industrial fight which lies before us. In that connection, one of the countries with which I and the hon. Member for the Moseley Division of Birmingham (Mr. Hannon) are very well acquainted, and which we have studied in the greatest detail because we know that it was a great competitor before the War and we are satisfied that it will again become one of the greatest competitors after the War, is Germany. I should like to read the opinion which the Germans have formed of what the result will be if and when this Bill becomes law and becomes effective.

The Germans are a people who study what is done outside their own country with the greatest detail. There is no country that collects such correct and such voluminous information about the doings of every other country and every other trade and industry outside their own country as Germany. Every scientist of every kind must learn German, for the simple reason that the most complete technical works dealing with any subject are to be found published in Germany. That does not mean that we have not in this country the very highest scientific talent in the world, but our publications are individual publications, whereas the Germans give us collective information from all over the world which otherwise we should have to put together for ourselves. Therefore they know, perhaps, a good deal more of what is going on in our own country, and what the result of a Bill such as this will be, than we may do ourselves. I should like to read a recent extract from a German paper, which says: The carrying through of this great electrification scheme by England will decisively influence the future progress of German industry and, above all, German exports of industrial products, upon the world markets. We shall have a much more difficult fight in world markets owing to the increased difficulties for export of industrial products created by cheaper cost of production in English industry. This is the opinion of our German competitors, and I think it is worthy of some consideration. I am certainly convinced that this Electricity Board, which some people doubt, will work efficiently. I have no hesitation in saying that it will work perfectly efficiently, that it will consist of members who know their business and have the interests of the country at heart, and that it will work in peace and harmony and in full co- operation with the Electricity Commissioners. If that be the case, and I feel convinced that that will be the case, I am satisfied that the result of the Bill will be very beneficial to the whole country, and more especially to industry.

Mr. HARRIS

We have just listened to a very impressive speech—impressive because of the vast technical knowledge of the hon. Member who delivered it, and the very high position which he holds in the profession to which he belongs. With great respect, I would say that he carries more weight with me, and I believe he will carry more weight with the public, than all the cleverness, skill and argument of the hon. and gallant Member for Hulme (Sir J. Nall), who, undoubtedly, put up a very effective, skilful criticism of the Bill, not, only on this Third Reading stage, but right through the earlier stages.

I had the honour for some time of serving on a Committee with the hon. Member for Lewisham, West (Sir P. Dawson) for a good many years I was on a Committee which inquired into the whole problem of electricity from the point of view of London. We had the advantage of the advice of engineers from all over the country and from all parts of the world, like Mr. Instill, of Chicago, who is always willing to give us the advantage of his vast experience, as well as municipal and company engineers. In a comparatively infant industry like this experts occasionally agree. The impression made on my mind by all the experts on all the inquiries I have attended for many years was that linking up, unification, was really the foundation of the cheap and economical supply of electricity. The difficulty, and it is no use blinking facts, which we were in in London is very much the same difficulty that the nation has suffered from during the last few years, namely, the difference of opinion between the school to which I belong, who believe in municipal and public ownership and, on the other hand, those who view with suspicion any extension of municipal enterprise and always favour company management and company organisation. In London we were held up for years by that controversy. The London County Council produced its scheme, but the tremendous battle that followed ended in its failure. Then companies were promoted and Bills introduced in this House, but they only commanded the hostility of those who believed in municipal enterprise, and the result was that nothing was done. What London has suffered as the result of this controversy during the last 20 years is difficult to estimate. The waste of money that it has caused in London must be immense, and the same thing applies to the country as a whole.

I feel a certain sense of responsibility. I have to ask myself if, because I believe in municipal enterprise, and advocate it as the most satisfactory way of supplying electricity, I am justified in opposing this Bill. I do not think I am. I do not consider that the Bill has much to do with the two principles to which I have referred. The greater part of the capital sunk in generating stations and electrical undertakings already is in public hands, and this will not he interfered with by the operation of this Bill. I think the Bill is really an attempt to deal with the problem from the purely technical side, to link up the whole system of electricity throughout the country, and that it follows, in spite of what has been said, the advice of the bulk of technical opinion. I have seen a secret report from an American electrical engineer, Mr. Merz, which cost the London County Council 1,000 guineas, and it deals with London and the Home Counties very much on the same lines as are followed by the Bill. Therefore, it would be a grave responsibility at this stage to throw out the Bill.

It may be that the Amendment is only a gesture, but I take it as a serious proposition, and the result, if the Amendment was carried, would be to defeat the Bill. We may he told that as a compensation we should he able to get rid of this rotten Government, and although I am most anxious to see a change of Government I do not think this particular Measure is the one to fight them on. There are many other Measures which lend themselves much more to attack. If the Bill were dropped, another year would go by before we could produce another scheme; and time is precious, the nation cannot wait. The matter is so urgent that it would be a very serious step to hang up this problem for another year. It should have been deal with directly after the War. A Bill was produced in 1919 and had it not been for the effective opposition of hon. Members opposite that scheme might have been in operation now and we might have made much progress towards unity and coordination throughout the country. In these circumstances it would be a great responsibility to vote against this Bill. But there are one or two criticisms I want to make. It is unfortunate that the railways have been largely excluded from the scheme. They can come in, but they need not. It is admitted that if we are going to have cheap electricity the most important load is the railway load, and when you come to deal with rural areas the only chance of getting a scheme into operation is to bring in the railways. I think it is rather unfortunate that we should exclude railway generating stations from being selected stations and treated as a part of the machinery for supplying cheap electricity.

There is one other point, and that is the constitution of the Board. Everything depends on the personnel of that body. If we get the right men who will take large views, men who understand the problem and are prepared to adopt drastic measures, then this scheme will function, but if, on the other hand, we get the mere politician, the man who is trying to compromise and is not prepared to take a bold line, it will mean another failure. It would be a good thing if during this Third Reading Debate the Attorney-General would tell us something about the membership of the Board. If the country knew the personnel it would give confidence and disarm opposition. If we can get the right administration then the legislation will be effective, but if we get a Board who will not concentrate on making the scheme a success then we shall have another Bill, another Committee of Inquiry, another Report, but no progress. The hon. and gallant Member for Hulme (Sir J. Nall) produced a lot of statistics in order to prove that England does not lag behind in the matter of electricity. His figures did not carry much conviction. Statistics can be made to prove almost everything.

Everyone who has travelled will know that for the first time in our history we have to face a serious competition, because other countries are taking away from us the one great advantage we have had over them—namely, cheaper power. We shall have to make full use of the advantage we have, of the wonderful assets we still possess in our coalfields, and if we can link them up with our business and manufactures on a right basis, on a sound scheme, then the advantage we have had for so long will he retained. For these reasons I am not going to vote against the Bill. It may be necessary to amend it, and in the-public interests