§ Mr. Nigel Birch (Flint)
I beg to move, in page 24, line 11, to leave out Clause 17.
The purpose of moving this Amendment is to raise the whole question of the method of compensation adopted by the Government. As the House will recollect, that method is the method of Stock Exchange values. I am particularly sorry that the Minister is not here. He has popped out again. He has been 329 very fugitive in his attendances today. I am particularly sorry, because this is the one part of the Bill where the Minister is likely to attain his object—the only part. I particularly want to refer to certain remarks he made on Second Reading. I have already had a contest with the Financial Secretary on the subject, and it is like boxing with a bolster—an occasional feather comes out but very little reaction is obtained. The Financial Secretary is very fond of quoting, "Let us Face the Future." He did it many times in Committee. As he rightly said, in "Let us Face the Future" it was laid down that fair compensation should be paid for nationalised industries. What we are asking is that that pledge should be carried out and that justice should be done to the holders of these securities. There is only one way of ensuring fairness and justice, and that is to have independent arbitration on the basis of "willing buyer—willing seller." That is to say, the business should be valued as a going concern on the basis of "willing buyer—willing seller."
That is the purpose we are really after in moving this Amendment. We shall not get our next Amendment called—in line 11, to leave out Subsection (1), and insert:
330 That is what we are after. The words we have put down are based on words used in the Coal (Nationalisation) Act. Therefore, they are words which hon. Gentlemen opposite have themselves used. What are the Government's objections to having this independent arbitration? The first objection, which has always been urged, is one of administrative difficulties. The Minister made that point particularly on Second Reading, and the Financial Secretary repeated it upstairs. I would like to quote what he said. It is worth remembering. This is in my collection of Glenvil Halliana. He said:
- "(1) Each of the bodies to which this Part of this Act applies, other than a local authority, shall be entitled to be compensated by the issue to them by the Central Authority of British Electricity Stock of such amount as, in the opinion of the Treasury, is at the vesting date of a value equal to the value of assets vested by this Act, which value, if not agreed, shall be determined by arbitration under this Act as the amount which the assets might be expected to realise if sold as one unit in the open market as assets of a going concern by a willing seller to a willing buyer on the basis of
- (a) the net annual maintainable revenue, that is to say, the net annual revenue which the assets as a whole might reasonably be expected to earn in the future, if they were not transferred from such body, and
- (b)the number of years purchase to be applied thereto,
- (2) For the purposes of the foregoing subsection the Arbitration Tribunal shall have regard to all relevant circumstances, but shall not make any allowance either because the acquisition will be compulsory or because the distribution of compensation among the several bodies will involve expense; and the Tribunal shall not allow in favour of any body any increase in value, which the assets may be expected to have after transfer by reason of their being in the hands of an Electricity Board."I am trying to show that even supposing we had attempted to take the net maintainable revenue as our standard, it would have been impossible, as the Minister showed in his Second Reading speech, because of the chaos obtaining among the various electricity undertakings …It would have been impossible even if other objections did not enter into it …"—[OFFICIAL REPORT, Standing Committee E, 16th April, 1947; c. 606.]There are five very solid reasons why the administrative difficulty should not be the dominating consideration. The first most obvious objection is that if it is a question of doing justice, the fact that it is difficult to do justice should not enter into the question at all. Justice is a superior consideration to administrative convenience, and therefore should not be urged. The second point is that one of the reasons of administrative inconvenience urged by the Minister and the Financial Secretary is that one has great difficulty in valuing an electricity company because of the varying franchises. That is a hopeless argument because the fact that a company has limited franchises makes it much easier to value and not much more difficult.
The whole trouble when you are valuing something is what you should pay for the goodwill. If you know precisely what the expectation of profits is, it makes it much more easy. The next reason—and I commend this to the Financial Secretary—is quite a new one and is what the Government themselves are now doing in the new Clause they have put down for the acquisition of nonstatutory undertakings. It is a very interesting Clause. For compensation for non-statutory undertakings, these provisions are laid down:There shall be paid by the Central Authority to the undertakers, by way of compensation for the transfer of the electricity 331 undertaking, such amount as the undertaking might have been expected to realise if—(a) it had been sold as a going concern on the date of transfer in the open market by a willing seller to a willing buyer; …(c) this Act had not been passed.It goes on to say that—Any question arising under this Section …shall, in default of agreement between the undertakers and the Central Authority, be determined by arbitration under this Act.…That is precisely what we are asking for in our new Clause, and the Government have themselves done it in the case of the non-statutory undertakers. I would say that gives the whole case away because there are no less than 300 non-statutory undertakers, and their accounts are drawn up on many varying bases. No question of franchises comes in, which makes it easier to value and, as my hon. Friend the Member for Stockport (Sir A. Gridley) pointed out yesterday, the accounts of statutory undertakers are closely circumscribed by legislation and regulation, and, therefore, they are far easier to deal with than the accounts of these non-statutory companies where the Government coolly say, "We value 300 of them if you happen to want that."
The fourth argument is that the present method the Government have adopted will be more convenient administratively. Will it be more convenient? There are 188 companies to be taken over, listed in the Schedule to this Bill, but only 45 of those companies are quoted on the Stock Exchange. Therefore,143 companies are not, and for those we have to fix a notional Stock Exchange price and, failing agreement on that notional price, the matter must go to arbitration. Not only have you to fix a notional price of the company but you have to fix a notional price for each class of security in that company. and many have five different classes of security. If you take the average as five, you will need to have 700 separate assessments, and it does not seem to me to be particularly convenient administratively.
Surely, what the Government want to do is not to have any delay in their vesting date, and there is no reason at all why going to arbitration should delay the vesting date any more than it has delayed the vesting date in the coal nationalisation scheme. All it does is to 332 cause a certain amount of inconvenience to the holders of these securities, and the Minister has never been very solicitous for their interests. Therefore, I should have thought it would not have worried him very much. So much for the argument of administrative convenience. If the case is as I have put it, the case is not very strong.
Turning to the second point, which is that the Government say it is unnecessary to have an independent tribunal because the Stock Exchange is itself an independent tribunal, the right hon. Gentleman has himself urged that consideration. Now it is very curious how superstitious are those who believe in materialism. Hon. Members opposite now believe in the plenary inspiration of the Stock Exchange. I notice that hon. Members opposite who have something more to lose than their chains are particularly enthusiastic on the subject of the Stock Exchange. This argument of the plenary inspiration of the Stock Exchange puts the Minister into a very awkward position. That is why I wish he was here, because he argued on Second Reading, and made a great point of this, that the companies have behaved badly because they have watered their capital and put up their dividends much too high. That was greeted, naturally, with great applause from the claque behind. Supposing he believed that. Could there be a stronger argument for not taking the Stock Exchange price? If the Minister believes that and believes he is paying more public money for something than it is worth, because watering capital means putting up fraudulently the value of the company on the Stock Exchange. The Minister has the choice of saying that he is giving away State money unnecessarily or of saying that he deliberately misled the House and if he takes the second line I hope he will apologise.
Our objection to Stock Exchange prices is that the value of any stock on the Stock Exchange, if it is going to be nationalised, depends entirely on what people believe the compensation is to be. Once it is known that anything is going to be nationalised nothing else matters The Argentine Railways they were valued on the Stock Exchange at £125 million and with the very active assistance of His Majesty's Government they were sold to the Argentine Government for £150 million. That is not to say that that is 333 what they were really worth. They were really worth a great deal more, but their value on the Stock Exchange was based on the guess of what could be got out of the Argentine Government and nothing else, and the Government gave active support to the companies in getting more than they were valued at on the Stock Exchange.
The usual answer which is given to this argument is that there are two dates—the option of taking the date before the Genera] Election or the date of the Bill. In passing I would point out that prices were in fact kept down before the Election because nationalisation was very actively canvassed for, and in 1943 a great deal of propaganda was put out. I will not insist on that argument. But the fact is that we are not comparing like with like. There would be more in the Government's case if they were compensating the holders with Government securities on the level which those Government securities stood on the first date and not on the level of the vesting date. Consols 2½ per cent stock stood at the time of the Election at about 84. Since then they have been up to 98½ and now have come down to 93. There are very long odds that the Chancellor of the Exchequer will rig the market up before the vesting date to pluck a few more feathers. But even supposing he does not, on the Government's argument holders should be compensated on the basis of old consols at 84 and not 93.
The effect has been even more marked on non-Government securities. Everyone can see that the Government's policy is inflationary, and so there has been a larger rise in ordinary shares as people want to contract out of Government paper because they know it is going down in value. If we take stocks similar to electricity stocks, in security we find that there has been a much bigger rise between these two dates. I take William Younger 5 per cent. preference shares—out of compliment to the hon. Member for Grimsby (Mr. Younger) who has as noble brewing blood in his veins of as deep a brown as any hon. Member in this House —they have appreciated by 17 per cent. In the case of Yorkshire Insurance company there has been a rise of 46 per cent. In the case of the Westminster Bank there has been a rise of 16 per cent., whereas the rise in the electricity undertakings 334 has been negligible between the two dates because the dominating factor was what we were likely to get.
Obviously, the price was purely a matter of guesswork as to what the compensation was likely to be. Therefore, there has been an extremely heavy capital loss owing to the fact that the Chancellor has "rigged the market" between the two dates. This causes great hardship to many people, but I am not arguing today upon an ad misericordiam basis, though a case could well be argued on that basis. I am arguing purely on the basis of justice, and justice has not been done. What the Minister wishes to do is to start his business off with a reverse subsidy from the holders of these securities. Justice, in the Minister's view, is the interest of the stronger.
§ Colonel Clarke (East Grinstead)
I beg to second the Amendment.
I wish to attack, from another angle, the Clause which we desire to delete. My hon. Friend the Member for Flint (Mr. Birch) has dealt with it capably and thoroughly from the angle he has taken. One aspect of this Clause is that it means that the State is taking over the assets of the electricity industry without any valuation. That, of course, may be an easy thing for the Government to do, but it is a very unsatisfactory and a lazy thing to do. There is no real check of the book value of what they are taking over. In the case of the coal industry they have got, or will have, a pretty accurate valuation. I believe it is a wrong thing to buy an industry or anything else the value of which one does not know, but it leads to worse things. In this case, for example, it will prevent any proper depreciation of the assets to be worked out. This emerged in the Debate yesterday. It will be impossible to work out what the proper depreciation should be if the assets are not known. If the depreciation figures cannot be put into the accounts, the accounts are practically valueless, because in an industry of this sort depreciation is very heavy, and if depreciation figures are not correct, the accounts will give a purely artificial view of the industry. By adopting this method of buying up the assets of the industry the Government arrive at the following three results. First, the country does not know what it is 335 getting in real value. Secondly, proper accounts cannot be kept because they cannot properly depreciate unless they know the value of their assets. Third, if proper accounts cannot be kept no one in the country will know whether the industry is being run at a loss or a profit, or is being subsidised from other sources. For these three reasons, in addition to the cogent ones put forward by my hon. Friend, I am seconding the Amendment.
§ Mr. Glenvil Hall
Those who were Members of the Standing Committee will recognise this Clause and the speeches so far made upon it, as old friends. I am afraid I can do no other than add my quota in the shape of the same speech or the same arguments in, I hope, an abbreviated form, and perhaps in a slightly different order. The points which have been made with such felicity by the two hon. and gallant Gentlemen opposite they have made before, and of course the answers to them must necessarily remain the same. It has been said on the occasion of more than one nationalisation Measure that this Government are not wedded to any particular form of compensation. They lay down one basis and one only; that is, that compensation should be paid, and that compensation should be fair.
This is not the first Measure that has been introduced for which compensation Clauses have been drafted. As the hon. Member for Flint (Mr. Birch) has reminded us, it is true that in several previous nationalisation Measures we have taken the net maintainable revenue as the basis of compensation. We would have been willing to do it here if it had been possible, but for reasons which my right hon. Friend gave at some length it was not possible. I thought those reasons were conclusive. I have refreshed my memory since we began discussing this Bill on Report stage by looking again at what he said with, I hope, an unbiased mind. I came to the conclusion that what he said was conclusive. The hon. Member for Stockport (Sir A. Gridley), in what he said yesterday with reference to the various franchises, bore out what my right hon. Friend said on this matter in his Second Reading speech.
§ Mr. Glenvil Hall
To make it quite clear I will read what was said. My right hon. Friend the Minister of Fuel and Power said:As regards the private companies. The problem is one of some complexity As I have already indicated, the companies engaged in the distribution of electricity operate on a limited franchise.He continued later:If it were a case of buying out a few companies, or parts of companies, it might be possible to make a detailed valuation of the assets of those companies. The House must appreciate that the problem of determining the value of those assets is almost unexampled in its difficulties. A company might be operating …Perhaps the hon. Member for Flint will listen to this because I am trying to be fair in this matter. We want to be fair, in the present situation, to the shareholders of these undertakings My right hon. Friend said:A company might be operating on 20 franchises which could be bought out by 20 different local authorities at 20 different dates. It would be necessary to determine the value of that particular portion of the company's assets which could be attributed to each franchise. To separate a portion of the assets of an integrated undertaking and then value that portion is very difficult, if not impossible.Then my right hon. Friend elaborated his argument, and, later said:Many of these franchises have already fallen in …In fact, many fell in before the war began and it was only the coming of the war which prevented their ceasing altogether and the local authority who had the option taking over. Then the Minister said:There is a further complication about the concept of net maintainable revenue as applying to electricity company undertakings."— [OFFICIAL REPORT, 3rd February, 1947; Vol. 432, cols. 1417–8.]My right hon. Friend went on to deal with the varying rates of dividend paid by these companies. Many of them, as the House knows only too well, have a monopoly and have used the powers conferred on them to declare very large dividends from year to year. It would be grossly unfair, if we laid down a net maintainable revenue applicable to them, to have to take in some cases a very high 337 rate of dividend when, in others which have felt more responsibility to the public in their duties and were not charging the consumer so much, so high a dividend was not being paid. Therefore, we take the Stock Exchange price as the most likely method of arriving without too great difficulty at what could be considered a fair price to pay.
The hon. Member for Flint said that I or my right hon. Friend, in an earlier Debate, talked about the Stock Exchange as an independent tribunal. Surely, so it is? It is not an independent tribunal in the sense in which a body which is set up for a definite purpose, which can hear very detailed evidence and have documents placed before it, can be described as a tribunal, but the value placed by the Committee of the Stock Exchange in their daily list is a true guide of the price which a willing buyer is prepared to pay a willing seller for certain shares. The hon. Member quoted—and I will not carry this too far—the price of Consols, and he thought that we ought to go back and take the price of these stocks at a given date as the basis on which compensation should be valued. If he takes that date on the one hand, why does he not want to take it on the other? He did mention the fact that we had taken certain dates, and I think these dates are fair. The one set of dates, the first set, was pre-Election, and I do not suppose there is anybody in the House who really believed that the General Election result would be what it was. [ Laughter.] There is nothing funny about this. I think everybody, from one end of the country to the other, was startled—
§ Mr. Glenvil Hall
—was startled by the majority which this Government received, and, at any rate, whether that is accepted or not, I think that what I am about to say will be accepted—that nobody on that side of the House believed that the name of the right hon. Gentleman the Member for Woodford (Mr. Churchill) would not carry that party into office, even if the majority was not a very large one. It is true to say that the Stock Exchange, before the result was made known, was not under any shadow of an impending Labour Government with a nationalisation policy. So far as stocks and shares quoted on the Stock Exchange were concerned, the Stock 338 Exchange imagined that the present state of affairs would continue, and possibly continue indefinitely. But, if it would be fairer to the stockholders that another date should be taken, we have a second date— a date just before the King's Speech which announced the Bill which is now before the House. Therefore, in giving the choice of these two dates, we have been as fair as possible to the shareholders. The only alternative would have been a long and laborious calculation, absorbing a great many people and involving the use, and the immobilisation from other work of many kinds of technicians in order to arrive at a true value. To do that would have been very difficult, if not impossible, because of the various franchises under which the undertakings operate.
§ Mr. R. S. Hudson
The right hon. Gentleman referred several times to what he called the difficulty of the franchise, and he has stated that one of the main difficulties was that there was a very large number of companies with different franchises running for different purposes. Could he tell the House, for its information, how many companies there are with more than one kind of franchise ?
§ Mr. Glenvil Hall
I could not offhand, but, if the right hon. Gentleman is interested, I will certainly, if I can, get that information for him, and if the House would like the information, I will see that it is conveyed to the House before these proceedings end. All I can say now is that there are a very large number indeed. As my right hon. Friend indicated in his speech on the Second Reading Debate, the ramifications are pretty considerable. The exact number does not really matter. The point is that it is well known that electricity has always been looked upon as being in a category by itself. It is a service essential to the community, like the railways, and in recent years, at any rate, it has never been allowed to operate as freely as it liked. In its own area and under Act of Parliament it has been given a monopoly in certain areas, but has worked under limitations. More often than not local authorities have had the option at some time or other of taking control of a particular undertaking.
It is my contention, and I hope that my hon. Friends will agree with me, that that makes a considerable difference 339 when we are trying to do justice to the individuals concerned and are trying to decide what compensation should be paid, and on what basis. The hon. Member for Flint (Mr. Birch) mentioned non-statutory companies. It is true that there is a fair number of them, but they are quite tiny. If his argument is that because they are there, and because, in order to be fair, we are treating them rather differently from the larger undertakings, we should let the "tail wag the dog," I am afraid I cannot agree with him.
The undertakings with which we are dealing form the overwhelming bulk for which this type of compensation will be paid, and number well over 96 per cent. of those which come under this Bill. Unless I am pressed, I will not go into a long argument on the point about Consols which was put to me by the hon. Member for Flint because I do not think it is germane to the matter. It is true that Consols were 84 on the date in 1945 which he mentioned, and that they had been up to 98½. I think they are now down to 92, 93 or 94. [An HON. MEMBER: "So what?"] So what? It does not really affect this argument. It might be useful if one were discussing gilt-edged securities, but it has nothing to do with this Clause, which lays down the basis of compensation which is the same in wording and intent, so far as this side of the matter is concerned, as that which appeared in the Transport Bill and in the Coal Industry (Nationalisation) Bill. Therefore, I would ask the House to reject this Amendment. We believe that the basis laid down in the Bill is a fair one, that it is just to those concerned, and that, from every point of view, it it is the only fair basis that could be taken in this case.
§ Mr. Norman Bower (Harrow, West)
There are just two points I wish to make on this matter to which no reference has yet been made on this occasion. First, I want to point out to the Financial Secretary that this policy of compensating shareholders according to Stock Exchange values is absolutely and completely contrary to the Chancellor's present policy as exemplified in the Profits Tax on distributed profits which he imposed in his recent Budget, and which had as its object to induce companies to plough back 340 into the business as much of their profits as possible, and to distribute to the shareholders, in the form of dividends, as little as possible. It is abundantly clear that the more a company distributes in the form of dividends and the less it ploughs back into the business, the higher its shares are likely to be quoted on the Stock Exchange. Therefore, in the future, in view of this policy which has now been adopted, there will be a great temptation to all other companies which are likely, or which may think they are likely, to be affected by future nationalisation Bills, to disregard the Chancellor's expressed wishes and to distribute as much as they possibly can in the form of dividends while the going is good, so that when the time comes for them to be taken over their shares will stand at the highest possible value on the Stock Exchange.
My second point is this. As the Financial Secretary has admitted that his speech was largely a repetition of the speech he made in Committee, perhaps I may also be allowed to repeat an argument which I made then. That is that the Stock Exchange value on any given day bears no real relation at all, and is no real guide, to the price at which the great majority of shareholders in these concerns would be willing to sell their shares. It is simply a guide to the value at which on any particular day a very small number of shareholders are willing to sell their shares to a very small number of buyers. The fact is that the great majority of shareholders in these companies are not willing to sell at all. They want to hold on to their shares. They are being forced to sell, and if any big buyer such as the Government went into the market determined to acquire control of these companies by the ordinary methods of the Stock Exchange, by buying up all the shares or buying a sufficient number to force all the shareholders to sell out, there is no doubt they would have to pay a much higher price than the price at which the very few transactions take place on any given day.
I submit, therefore, that that argument, which anybody who is conversant with Stock Exchange procedure knows to be true, completely knocks the bottom out of the argument that the Stock Exchange price on any given day really represents 341 the price at which willing sellers of these shares, or shareholders as a whole, would be willing to sell to a buyer. These shareholders are being forced to sell, and, therefore, they ought to be given a fair value for the shares which they do not want to get rid of, and not a purely artificial price such as the Stock Exchange quotation on any particular day.
§ Mr. Lipson (Cheltenham)
We have been told that the Government are anxious to be just in this matter. I think that is the feeling of the whole House, but we have been asked to accept the Government's interpretation of what is just, and that is where the difference between the two sides of the House lies. The Financial Secretary has told us that there are certain difficulties in the way of so adjusting this matter that the holders of these electricity securities should, under the new setup, have the guaranteed income which they had before. I cannot see why these difficulties could not be resolved by resorting to arbitration. The arbitrator would be able to take into account all the factors which the right hon. Gentleman mentioned, and this procedure, would have this advantage that the Government would not only be just, as they are anxious to be, but they would appear to be just to those whose securities they are proposing to take over.
I agree with my hon. Friend the Member for West Harrow (Mr. Bower) that it is not a case of a willing buyer and a willing seller. In this case it is an anxious buyer and an unwilling seller, and an entirely different situation has been created. In the first nationalisation Measure brought in by this Government, the Coal Industry Nationalisation Act, the principle of arbitration was accepted, and that met with the general recognition that it was a fair and just way of proceeding. What I do not like about the Government's proposal is this. They are themselves arbiters in a matter in which they are directly concerned. They are arbiters in the sense that they have chosen the particular test by which the value of the securities should be determined. The Government are satisfied that the Stock Exchange price is a really fair and just price. But then, that may be the decision of the arbitrator; and if the arbitrator accepts that, then nobody would quarrel with him.
342 I speak as one who accepts the main principle of the Bill. I voted for the Second Reading. But I am anxious, anyhow, that in all our nationalisation proposals we should be fair to those who, I believe, have rendered a service in the past to the country by helping to finance the electricity industry at a time when the State was not prepared or was, for one reason or another, not able to do it. It is, indeed, true that a great many people have relied upon what they have considered certain conditions. If the Government persist in taking the Stock Exchange value in determining these things, those people will find that their income is very seriously curtailed. I ask the Government to look at the matter again in the name of the very principle they themselves have invoked, the principle of justice. What I understand by justice is not only justice from the Government's point of view, but also justice to those whose security it is proposed to take away.
§ Colonel Lancaster
I want to limit my remarks to two aspects of the matter. The first is whether or not it is feasible to adopt any other method than this Stock Exchange value method. I do not think that, merely because another method would be a lengthy or difficult task, the Government thereby are entitled to say they are going to approach it only in this way. If their intention is to do justice they should not be deterred by the mere thought of the work involved. But so far as the Stock Exchange value is concerned, I think my hon. Friend the Member for West Harrow (Mr. Bower) put it very cogently when he said that at any given moment the Stock Exchange price does not, in fact, represent the value of an undertaking. If matters were as simple as that, then at any given moment it would be possible, by purchasing 51 per cent. of the shares of a company, merely at the valuation of the Stock Exchange, to obtain control of that undertaking. The Financial Secretary knows perfectly well that nothing of the sort, would, of course, occur. If he wants proof of this let him look at the prices ruling today of some of the leading coal companies. A great many of the shares. have gone up, since it is perfectly obvious that their Stock Exchange value at a given moment has no relevance to their value as going concerns as between a ready buyer and a ready seller. That is shown 343 by even the method the Government employed in regard to arriving at the global sum they did arrive at.
I do not think the Financial Secretary really, in his heart of hearts, has any faith in this method. He propounds on the Floor of the House precisely the same arguments as he advanced upstairs, but he is now attempting to stand up to the criticism of the method as such, and if he continues to maintain that he is desirous of seeing justice done, surely to goodness he should apply some other method than this wholly unsatisfactory one.
§ Colonel Crosthwaite-Eyre
The right hon. Gentleman the Financial Secretary said very truly that all he had done tonight was to repeat the arguments that he made upstairs, but I do not think he has made them even as effectively as he did on that occasion. In the first place, he talked about franchises. What the Financial Secretary said was so difficult is being done every day. Take a particular company in the Division next to my own. The Bournemouth Corporation are trying to buy out that part of the electricity corporation which supplies its own power. It takes in three different local authorities. One is a rural district and the other is an urban district. There has been no difficulty whatsoever' in ascertaining which part of the franchise applies to Bournemouth I do not know on what grounds the Financial Secretary says that this matter is so very difficult, but for the last 40 years nobody has ever found it difficult to make such an apportionment. In a change of companies it has been done time and time again, when nobody has found it the least trouble.
The Financial Secretary went on to say that under the Bill the situation was rather difficult in the case of companies which had distributed dividends in excess of what they should have done. He did not say that in the case of a company which had so abused its position, or which had assumed a more generous policy, there would be benefit under the Bill. A company which has tried to develop its property and to follow the dictum of the Chancellor of the Exchequer might not stand so high on the Stock Exchange as the company which has not done so. How can the Financial Secretary say that it is difficult to deal with this situation? Our Amendment 344 is the only way in which he can ensure that the Government take over every company at its equivalent valuation. An hon. Member has already pointed out that the Government appear to have no idea of the value of the assets they are taking over. What in fact the Government are doing is to buy a whole series of shares at prices which they assert are fair without knowing first of all what they are buying, or making any estimate whatever as to whether they are buying at a just price from people who have done well, or at an unjust price from people who have done badly.
The Financial Secretary knows that Stock Exchange prices at any given moment reflect the intrinsic return which an investor may obtain from a company. Suppose the date which the Financial Secretary chooses is just prior to the dividends being paid, the shares of the company will be much higher than those of an equivalent company whose dividends has just been passed. What allowance is made for that situation in the price which the Financial Secretary mentioned? I could cite a number of such anomalies. The whole thing goes very much deeper. The Financial Secretary has ignored a principle which has been fundamental to the whole of our commercial practice. When one takes over the assets of a company one has to compensate the company for assets which are not those of the share-sholders. I know that that sounds difficult, but there are three distinct kinds of company in question.
There is the company with it assets and there is the shareholder. The company "owns the assets and unless this fundamental fact is borne in mind, one is bound to get the whole terms of compensation wrong. The position of the company in regard to its assets has been long established. I have earlier this evening quoted the case of Salamon v.Salamon, where it is laid down that the company is an individual entity and is not responsible to the people who have signed its articles of association. Thus the company is responsible for its assets and if one tries to truncate it, and compensate the shareholders, one gets all these anomalies. If one wants to value the assets and compensate the' company all these troubles fall apart. The distribution of assets and all the other problems would 345 then disappear, but the Government are trying to take assets from the one side and pieces of paper on the other without reference to these fundamental issues of company law.
I would try to mention two parallels to bring it home. Let us take the case of a town council. In that case the mayor and the burgesses are responsible to the town. Suppose somebody takes over the town hall, the last people to be recompensed would be the ratepayers. Nobody would dream of paying somebody among the ratepayers, and quite obviously compensation would be to the town council. Let us take the case of this House of Commons. The Government are responsible to this House and we are responsible to the people. Our complaints have been rightly upheld where a Minister has gone above the heads of hon. Members by going straight to the people instead of to this House. It is quite demonstrable that the Government are not being fair, and unless this chain is pursued one is bound to get these anomalies. I do ask the Government therefore to consider the fact that, by adopting this policy they are breaking every fundamental rule of company law. By following this policy they are giving the least possible advantage to those who have tried to benefit the community, and they are going to land this country into an unknown expense for something which they cannot assess. They are breaking the principles on which we have built our strength and, equally, they are denying those who have striven to benefit this country from any reward which they might reasonably expect from any Government, be it Left or Right.
§ Mr. Henry Strauss (Combined English Universities)
I apologise for intervening without having heard all the Debate, and I intervene on only one point. The Financial Secretary to the Treasury said—and I was glad to hear him say it—that the Government wished to be fair, and my objection to this Clause is that the Government are not being fair. It has been pointed out on many occasions that in their various nationalisation schemes the Government have adopted several inconsistent methods of compensation. These inconsistent methods cannot all be just, but it is a well known point of logic that they can all be unjust. This particular one is unjust for the simple reason that it does not purport to value the thing which is being taken over.
346 Some hon. Members have spoken as though the shareholders were having their shares taken over. Nothing of the sort is taking place. There is no provision in this Bill to deprive the shareholder of his share. If there were such a provision, then it would be a matter for argument whether or not it was right to take over his share at the Stock Exchange valuation. There would be a great deal to be said on that point; but in the present case no share is being taken over. The assets which are being taken over are those of a different person, namely of a company, and the company is then being wound up. After the winding-up, the shareholders are entitled to something by reason of the winding-up. That is how the matter stands in law and-equity.
The thing you have to value is the assets of the company which you are taking over. There is no attempt to value those assets. The right hon. Gentleman says it might be difficult to value them. Whether that is true or not, that is no reason for abandoning the attempt. If you are to do justice, you must attempt a valuation of the thing you are taking over. You are taking nothing from the-shareholder: you are taking everything from the company. Therefore, what you have to value, if you are to be just, is what you are taking from the company. If you do not do this, you are demonstrably not making any attempt to be just. If you make an attempt to be just, and value what you take from the company, and what the company has lost by reason of your measure, then the next question is how what the company gets is to be divided among those entitled to the assets on the dissolution of the company; because under Clause 13 the company is being dissolved. On such a dissolution, if there were any difficulty as to the allocation of the compensation, that is a matter with which the courts would have no difficulty in dealing; or it could be dealt with by appropriate provisions in this Bill.
But what is quite fantastic is to say that you will take over the assets of the company, but you propose to value the shareholding of a different person, from whom you are taking nothing. The right hon. Gentleman, in his reply to the Debate, did not deal at all with that point. It is not improper that I, speaking as a lawyer, should express quite simply why this pro- 347 vision is perfectly shocking to anyone who has any regard for law and equity. I am not myself making any statement on whether, in the final result, the individual shareholder will get too much or too little as a result of what the Minister is doing. I think it is quite possible that in some cases he will get too much, and in other cases much too little. What is certain is that he can only get the right amount by a complete fluke, because there is no reason whatsoever why the effect of what the Government are doing should bear any relation to justice or equity. I assure the Government that the -credit of the nation is affected by this matter. One cannot do what, on the face of it, is demonstrably unjust and think that the national credit will not thereby be affected. If what we, on this side of the House, contend is correct, and so far there has been no answer to it, this Clause will injure the national credit: because the Government are saying that they will nationalise the industry, and that they will compensate someone else, by a method which does not purport to be just. I hope we shall get a reply tonight from some other Minister I am 'surprised at the absence of the Minister of Fuel and Power. I should have thought that this was one of those matters—the national credit—for which he should care something more than a "tinker's cuss."
§ Mr. Ungoed-Thomas
If in fact the shares were taken over at valuation—the point mentioned by the hon. and learned Gentleman the Member for the Combined English Universities (Mi. H. Strauss)— would that not automatically give the shareholders the assets of the company?
§ Mr. Strauss
I am not called upon to deal with that point, for this quite simple reason, which I am sure the hon. and learned Member for Llandaff and Barry (Mr. Ungoed-Thomas) will appreciate, that there is no Clause in the Bill which purports to take over the shares. If there were a Clause in the Bill which purported to take over the shares I should be perfectly willing to argue whether the proposal for valuing those shares was just or unjust, but I do not want to transgress the rules of Order, and it would be absolutely out of Order to discuss whether this would be the fairest valuation of the shares if they were to be taken over.
§ Mr. Ungoed-Thomas
In view of the hon. and learned Member's answer does 348 he now realise the unreality of his previous argument?
§ Mr. Strauss
I appreciate that my previous argument was entirely sound or the hon. and learned Member would have replied to it. He has not replied to it and if he has any response to make he will no doubt get up and make it now.
§ Mr. Ungoed-Thomas
The reply is quite clear in the question. If the Government choose to 'take over all the shares at a valuation, then they would control all the assets of the company. What this does is to short-circuit the procedure of taking over the assets of the company, and the shareholders' compensation is assessed in accordance with the way the Government have decided. The hon. and learned Member should address his remarks to the argument of the hon. and gallant Member for New Forest and Christchurch (Colonel Crosthwaite-Eyre), who is no longer in the House, and not to the logical distinction between the company and the shareholders. He should remember the method which the Government have adopted, and the question of whether there should be a tribunal basis or whether it should be that basis, to which the hon. Member for Cheltenham (Mr. Lipson) addressed his remarks—the basis of the Stock Exchange value.
§ Mr. R. S. Hudson
I think that the hon. and learned Member for Llandaff and Barry (Mr. Ungoed-Thomas) has really put his finger on the point which divides the two sides of the House. Those hon. Members who have listened during the last hour to the arguments cannot fail to have been struck by the fact that the cogent arguments advanced from this side of the House have not, in fact, been met. What is the gravamen of our charge? We say that the Bill—and this is admitted on both sides—provides for the taking over of the assets of the electricity companies and that the members of the Labour Party, who subscribed to the views outlined in "Let us Face the Future," quite genuinely and sincerely wanted to see the promise carried out that compensation should be given in respect of the industries that were nationalised, and that that compensation should be fair.
The problem really arises, what is fail compensation? If the assets are to be taken over, how is fair compensation to be arrived at? In the case of the coalmines the amount of compensation was 349 decided by a tribunal. Neither the shareholder, the Government nor the company has the final say. It is provided by the tribunal, and we say that that is the simplest and best way of arriving at a fair compensation. In support of that argument, there is the case of the nonstatutory undertakers, where the Government have accepted the principle of arbitration, though the new Clause which should have been already passed has not been passed for reasons which I need not go into. In the case of the majority of the 188 companies whose names appear later on in the new Schedule, the Government themselves admit that, in order to arrive at a fair figure, it will be necessary to go to arbitration.
10.45 P m
We say that, having admitted that arbitration is the fair method, it ought to be adopted as regards the whole of the assets of the companies. There are two possible arguments against that. The first is the question of delay. It may be argued that to go to arbitration would mean the expiry of considerable time and that that would have a deleterious effect on the industry because it might be expected to postpone the date of the taking over. That argument does not hold water because it could quite easily be arranged for the assets of the industry to be taken over on the vesting date and leave the filial determination of the sum to be paid until afterwards. In fact that is what is being done. The Financial Secretary to the Treasury will remember that he moved a new Schedule embodying what is called the bank scheme in Committee, but he himself admitted that the final adjustment would not be done in the course of January or February next year. He admitted—I am speaking from memory—that before the thing was finally cleared up probably two years or more might elapse.
§ Mr. Glenvil Hall
I think the right hon. Gentleman will agree with me when I say that was only a change of the stocks certificate itself notionally. Under the new plan, stocks certificates still in the possession of the holder would become the new Central Authority stock with the amount notionally written in to show the change. It does not mean that the amount is not known. It is very well known. It is simply that the registration will not have taken effect in some cases for two years
§ Mr. Hudson
What I was trying to show was that whatever may be the final stage will not take place for anything up to two years. That will not prevent the assets of the whole of the industry being effectively vested in the Government as from that date, and therefore as far as the Government taking over through the new Central Authority and running electricity is concerned, the delay in ascertaining its real value is not material from the point of view of the national interest.
Therefore, we come to the final argument about delay and that is, that it would take some time and it would be more difficult. As has been argued by all hon. Gentlemen and right hon. Gentlemen who have spoken from this side, the Government are now driven to the conclusion that they will not do something which is fair because to do it would be difficult. That is a denial of justice. It would not be so frightfully difficult to ascertain all these various sums—the value of the assets. Indeed, an attempt will have to be made to make a valuation of the assets if, as we said yesterday, it is desired in future to have any real idea of whether it is paying its way or not.
I am perfectly certain that if the question were put to the vote of the shareholders in the various companies concerned as to whether they would accept the Government proposal of taking the Stock Exchange values finally, or whether they would wait until there could be a proper ascertainment, subject to arbitration, I am sure that no one on this side of the House has any doubt which shareholders would choose. When hon. Members go into the lobby, as presumably as they will when I sit down, let them remember that, if, as I believe, the shareholders would say that they would prefer the basis of compensation which I suggest for the assets that are being compulsory taken over, that is definite and overwhelming proof that, in the opinion of the people mainly concerned, the party opposite are not carrying out the pledge they gave at the last Election. For the sake of fairness and their own conscience I would beg them even at this late stage to think again.
I had hoped all through this Debate that it would not end without the Minister being here. This is a very important part of the Bill and it would have been sad if he had been detained too late to have heard this stage of 351 our discussions. I was a little surprised at the use, in a condemnatory sense, by the hon. Gentleman just below the Gangway, of the word "legalistic" as applied to the argument as to the difference between a corporation and shareholders. I wonder if he did not feel that there was a great deal more legalism in the Government sense—notional whatnots and all that. I wonder if he did not think that that was far more legalistic and far more metaphysical than the alternative scheme which has been proposed from this side. This is more than a matter of legalism or metaphysics, though for that matter I see no evil necessarily either in metaphysics or in legalism. The hon. Gentleman below the Gangway invited us to leave these legalistic difficulties and to explain some straightforward practical reason why it made any difference.
There is a straightforward reason which has not perhaps been plainly put in its exact connection; and it was that question of his on the straightforward practical side of this matter which has brought me to my feet. This is a straightforward practical proposal. As a result of this confusion between the corporation and the individual we have been landed with these difficulties. I would refer to two companies; and I am not speaking on hypothesis, but of two companies of which I know enough, I think, to speak dogmatically. The directors of A company got into their heads some two years ago that there was likely to be a valuation on Stock Exchange values, and after consultation among themselves and some of their friends, they agreed that they would make their dividends as high as they decently and properly could should the Government put compulsion upon them. Company B, having just the same sources of information, makes the same guess, but decides that it ought to con-
§ tinue its business exactly as if it did not think there was any question of nationalisation. The practical effect—not legalism—is that company A has behaved in a manner which I think the friends of the Government would describe as antisocial, because it put up Stock Exchange values; Company B gets smaller compensation. That is one result of the logical difficulties which lie at the root of everything in this Bill.
§ There is another point I would like to make. It is a point which was put very cogently, and, I think quite unanswerably by my hon. Friend the Member for Flint (Mr. Birch). The Financial Secretary to the Treasury said he would not go into it very deeply; nor did he. But if I may try to put the point—I hope I am going to get this right, I think I am—if I may try to put it in quite a simple way—on any hypothesis upon which Stock Exchange figures—I will not say values—are the right ones, upon that same hypothesis the thing given in exchange for what is being taken should-also be as it was at the date chosen. Surely that is quite right. The payment should be as the payment was on that date on the Stock Exchange list, upon any hypothesis which makes the Stock Exchange figures valid. The simplest way possible to bring this home is to say to any Member opposite who holds sound stocks and shares. "Would he be willing to sell them now at the prices ruling on the dates chosen in this bill?" If hon. Members opposite feel any doubt at all about the answer to this question, they must feel that this way of fixing what is called compensation, in my judgment both logically and etymologically wrongly, they must agree that this method is wrong.
§ Question put, "That the words proposed to be left out stand part of the Bill."
§ The House divided: Ayes, 253; Noes, 102.355
|Division No. 280]||AYES.||[10.57 p.m|
|Adams, Richard (Balham)||Battley, J. Ft.||Buchanan, G|
|Adams, W T. (Hammersmith, South)||Bechervaise. A E.||Burke, W. A.|
|Allen, A. C. (Bosworth)||Benson, G||Butler, H. W. (Hackney, $.)|
|Alpass, J. H.||Berry, H.,||Callaghan, James|
|Anderson, A. (Motherwell)||Beswick, F.||Carmichael, James|
|Anderson, F. (Whitehaven)||Blackburn, A. R||Chamberlain, R. A|
|Attewell, H. C.||Blenkinsop, A.||Champion, A J|
|Austin, H. Lewis||Bowden, Flg.-Offr. H. W||Cobb, F. A.|
|Awbery, S. S.||Bowles, F. G. (Nuneaton)||Cocks, F S.|
|Ayrton Could, Mrs B||Braddock, Mrs. E M. (L'pl. Exch'ge)||Cotlindridge, F.|
|Bacon, Miss A.||Braddook, T (Mitcham)||Collins, V. J.|
|Baird, J||Brook, D (Halifax)||Colman, Miss G. M.|
|Barstow, P G||Brooks, T J. (Rothweli)||Comyns, Dr. L,|
|Barton, C.||Brown, T. J. (Ince)||Corbet, Mrs. F. K. (Camb'well, N.W.)|
|Corlett, Dr. J||Janner, B.||Ranger, J|
|Cove, W. G.||Jay, D. P T||Rhodes. H|
|Crawley, A.||Jeger, G. (Winchester)||Robens, A.|
|Crossman, R. H. S||Jeger, Dr. S. W. (St. Pancras, S.E.)||Robertson, J. J. (Berwick)|
|Daggar, G.||Jones, D. T (Hartlepools)||Ross, William (Kilmarnock)|
|Daines, P.||Jones, J. H. (Bolton)||Royle, C.|
|Davies, Edward (Burslem)||Keenan, W.||Sargood, R.|
|Davies. Ernest (Enfield)||Kenyon, C.||Scollan, T|
|Davies, Harold (Leek)||King, E. M.||Sharp, Granville|
|Davies, Hadyn (St. Pancras, S.W.)||Kinghorn, Sqn.-Ldr. E||Shawcross, C. N. (Widnes)|
|Davies, R. J (Westhoughton)||Kinley, J.||Shinwell Rt Hon E|
|Deer, G.||Lang, G.||Shurmer, P.|
|Delargy, H. J.||Lavers, S.||Silverman, J (Erdingion)|
|Diamond, J.||Lee, F. (Hulme)||Simmons, C J.|
|Dodds, N N||Leonard, W||Skeffinglon, A. M.|
|Donovan, T.||Levy, B W.||Skeffington-Lodge, T C|
|Driberg, T. E. N.||Lewis, A. W J. (Upton)||Smith, C (Colchester|
|Dugdale, J (W. Bromwich)||Lindgren, G. S||Smith, S. H. (Hull S.W.)|
|Durbin, E. F. M||Lipton, Lt -Col. M||Snow, Capt J. W|
|Ede. Rt. Hon. J. C||Logan, D. G||Solley, L. J|
|Evans, John (Ogmore)||Longden, F.||Sorensen, R W.|
|Evans, S N (Wednesbury)||Lyne, A W||Soskice, Maj Sir F|
|Ewart, R.||McAllister, G||Sparks, J A|
|Fairhurst, F.||McGhee, H G||Strauss, G. R. (Lambeth, N.)|
|Farthing, W J.||Mack, J D.||Stubbs, A. E|
|Fernyhough, E.||McKay. J (Wallsend)||Swingler, S.|
|Field Capt W. J.||Mackay, R W. G (Hull, N.W)||Sylvester, G 0.|
|Fletcher, E. G M. (Islington, E.)||McKinlay, A S.||Taylor R. J. (Morpeth)|
|Follick, M.||Maclean, N (Govan)||Thomas, D E. (Aberdare)|
|Foot, M. M.||McLeavy, F.||Thomas, I. O. (Wrekin)|
|Forman, J. C.||Mainwaring, W H||Thomas, George (Cardiff)|
|Fraser, T (Hamilton;||Mallalieu, J P W||Thomson, Rt. Hon G R. (Ed'b'gh, E.)|
|Freeman Peter (Newport)||Mann, Mrs. J||Thorneycroft Harv (Clayton)|
|Gaitskell, [...] N||Manning, C. (Camberwell, N.)||Tiffany, S.|
|Gallacher, W.||Manning, Mrs L. (Epping)||Tolley, L.|
|Ganley, Mrs. C. S||Mathers, G||Tomlinson, Rt. Hon G|
|Gibbins, J.||Medtand, H. M.||Ungoed-Thomas, L|
|Gibson, C. W||Middleton, Mrs L||Walkden, E.|
|Gilzean, A.||Mikardo, Ian||Walker, G. H|
|Glanville, J. E. (Consett)||Mitohison, G. R.||Wallace, G. D. (Chislehurst)|
|Goodrich, H. E.||Moody, A S||Wallace, H W. (Walthamstow, E.)|
|Gordon-Walker, P. C.||Morgan, Dr. H. B.|
|Greenwood, Rt. Hon. A. (Wakefield)||Morley, R.||Watkins, T. E.|
|Crey, C. F.||Morris, Lt.-Col. H. (Sheffield, C.)||Watson, W M|
|Webb, M. (Bradford, C.)|
|Grifrson, E.||Morris, P (Swansea, W.)||Weitzman, D.|
|Grffiths, D. (Rother Valley)||Moyle, A||Wells P L. (Faversham)|
|Griffiths, W D. (Moss Side)||Murray, J. D||Wells, W T (Walsall)|
|Guest, Dr. L. Haden||Nally, W.||West D. G.|
|Gunter, R. J||Neal, H. (Claycross)||Westwood, Rt. Hon. J|
|Guy W H||Nicholls, H. R. (Stratford)||Whileley, Rt. Hon. W.|
|Hale, Leslie||Noel-Baker, Rt. Hon P. J (Derby)||Wigg, Col. G E.|
|Hall, W. G.||Noel-Buxton, Lady||Wilkes, L.|
|Hamilton, Lieut.-Col. R||O'dfield, W. H.||Wilkins, W. A.|
|Hannan, W (Maryhill)||Oliver, G. H||Willey, O G. (Cleveland)|
|Hardy, E. A||Orbach, M.||Williams, J. L. (Kelvingrove)|
|Harrison, J||Paget, R T||Williams, W. R. (Heston)|
|Hastings, Dr Somerville||Paling, Will T. (Dewsbury)||Williamson, T.|
|Henderson, Joseph (Ardwick)||Palmer, A M F.||Willis, E.|
|Herbison, Miss M.||Pargiter, G. A||Wills, Mrs. E. A.|
|Hewitson, Capt M||Parker, J.||Wilmot, Rt. Hon. J|
|Hobson, C R||Parkin, B. T.|
|Holman, P||Peart, Thomas F.||Woodburn, A.|
|Holmes, H E. (Hermworth)||Piratin, P||Woods, G. S.|
|House, G||Platts-Mills J. F F.||Wyatt, W.|
|Hoy J.||Poole, Major Cecil (Lichfield)||Yates, V. F.|
|Hubbard, I.||Popplewell, E||Younger, Hon. Kennety|
|Hudson, J. H. (Ealing W.)||Porter, G. (Leeds)||Zilliacus, K|
|Hughes, Hector (Aberdeen, N.)||Price, M, Philips|
|Hughes, H. D (Wolverhampton, W.)||Pritt, D. N||TELLERS FOR THE AYES:|
|Hutchinson, H. L. (Rusholme)||Proctor, W. T||Mr. Pearson and|
|Hynd, H. (Hackney, C.)||Pryde, D. J.||Mr. Micbael Stewart.|
|Hynd, J. B. (Attercliffe)||Randall, H. E|
|Amory, D. Heathcoat||Braithwaite, Lt.-Comdr. J. G.||Crosthwaite-Eyre, Col O. E|
|Astor, Hon. M||Bromley-Davenport, Lt.-Col. W||Crowder, Capt John E|
|Baldwin, A. E.||Buchan-Hepburn, P G T||Davidson, Viscountes|
|Barlow, Sir J.||Butcher, H W||Dodds-Parker, A D|
|Beechman, N. A||Byers, Frank||Drayson, G B|
|Bennett, Sir P.||Channon, H||Drewe, C|
|Birch, Nigel||Clarke, Col R. S.||Eden, Rt. Hon. A|
|Boles, Lt.-Col. D. C. (Wells)||Clifton-Brown, Lt.-Col. G.||Elliot, Rt. Hon Walte-|
|Bower, N||Conant, Maj. R. J. E.||Fraser, Sir I (Lonsdale)|
|Boyd-Carpenter, J. A.||Cooper-Key, E M||Gage, C|
|Bracken, Rt, Hon. Brendan||Corbett, Lieut.-Col. U. (Ludlow)||Galbraith, Cmdr T. D|
|George, Maj. Rt. Hn. G Lloyd (P'ke)||McCallum, Maj. D.||Roberts, H. (Handsworth)|
|George, Lady M Lloyd (Anglesey)||Macdonald, Sir P (I. of Wight)||Roberts, Maj. P. G (Ecclesall)|
|Gridley, Sir A.||Mackeson, Brig. H R.||Ropner, Col L.|
|Grimston, R V.||MacLeod, J.||Scott, Lord W.|
|Hannon, Sir P. (Moseley)||Macmillan, Rt. Hon. Harold (Bromley)||Shepherd, W. S (Bucklow)|
|Hare, Hon. J H. (Woodbridge)||Macpherson, N (Dumfries)||Spence, H. R.|
|Harvey, Air-Cmdre. A, V||Manningnam-Buller, R. E||Stoddart-Scott, Col. M.|
|Headlam, Lieut.-Col Rt Hon. Sir C||Marples, A E||Strauss, H. G. (English Universities)|
|Henderson. John (Cathcart)||Marshall, D. (Bodmin)||Studhoime, H. G|
|Holiis, M C.||Marshall, S. H (Sutton)||Sutcliffe. H|
|Hope, Lord J||Morrison, Maj. J. G (Salisbury)||Taylor, Vice-Adm.E. A. (P'dd't'n. S.)|
|Howard, Hon. A.||Morrison, Rt. Hon W S (Cirentester)||Tlomas, J. P. L (Hereford)|
|Hudson, Rt. Hon. R S. (Southport)||Neven-Spence, Sir B.||Thornton-Kemsley, C. N.|
|Hurd, A.||Noble, Comdr. A. H. P||Touche, G. C.|
|Hutchison, Lt.-Cm. Clark (E''b'rgh W)||Nutting, Anthony||Vane, W M. F|
|Hutchison, Col. J. R. (Glasgow, C.)||O'Neill, Rt. Hon Sir H||Wadsworth, G|
|Jarvis, Sir J||Osborne, C||Walker-Smith, D.|
|Keeling, E. H||Peto, Brig. C H. M.||Ward, Hon. G. R|
|Lambert, Hon G||Pickthorn, K.||Wheatley, Colonel M J|
|Lancaster, Col. C. G||Ponsonby. Col. C E||Willoughby de Eresby Lord|
|Lennox-Boyd, A. T||Poole, 0 B. S. (Oswestry)||York, C|
|Lipson, D L.||Raikes, H. V|
|Low, Brig A. R. W||Reid, Rt. Hon. J. S. C. (Hillhead)||TELLERS FOR THE NOES:|
|Lucas-Tooth, Sir H||Roberts, Emrys (Merioneth)||Lieut.-Colonel Thorp and|
|Ma or Ramsay.|