§ The Minister of Transport (Mr. John Maclay)
With your permission, Mr. Speaker, and with the leave of the House, I should like to make a statement on British Transport Commission charges.
The British Transport Commission estimate that rises in wage rates and prices during 1951 will increase their annual working expenses by at least £40 million, excluding certain wage increases granted in 1951 but made retrospective to the end of 1950. About £26 million of this is in respect of increases in wages and salaries, of which about £18 million is represented by the 2573 effects of the recent decision of the Railway Staff National Tribunal of 7th November last.
The Commission also estimate that the rising trend of prices will further increase their working expenses next year by about £11 million, and that, with railway passenger and freight, and dock and canal, charges at their present level, the Commission would, in 1952, incur a deficit of about £39.5 million. This would be in addition to the accumulated deficit from past years which was nearly £40 million at the end of 1950, and may well be more at the end of 1951.
The Transport Tribunal recently concluded a public inquiry into a draft passenger charges scheme which, if confirmed, would produce in a full year additional revenue of about £22.8 million. The draft scheme may be altered by the Tribunal, but even if confirmed without alteration there would still be a deficit of between £16 million and £17 million in a full year.
In these circumstances, the Commission applied to me under Section 82 of the Transport Act for authority to increase, as soon as possible, existing railway freight, dock and canal, charges by 10 per cent., subject to a maximum increase of 10s. per ton in the case of railway charges for merchandise by goods train and perishable traffic by passenger train, and subject also to special increases of about 20 per cent. in the charges for small parcels by goods train and 50 per cent, in the charges for the carriage of returned empties. These increases would produce about £22 million in a future year. The effect of the maximum increase of 10s. per ton would be to limit the increase in the case of some long distance traffic, for example, between the South and the Highlands of Scotland.
As required by the Act, I referred the application for the advice of the permanent members of the Transport Tribunal, acting as a consultative committee, and asked that their advice should be tendered as soon as possible. I have received such advice in a memorandum, a copy of which is being circulated in the OFFICIAL REPORT.
The committee recommend that I should authorise, as soon as possible, the increases applied for, except that the increases in the charges for small parcels 2574 and returned empties should, like the increases in other charges, be 10 per cent. This modification would reduce the estimated yield from £22 million to £21 million.
I am satisfied that these recommendations should be accepted and I propose to make Regulations accordingly, to take effect as from 31st December, 1951. I regret the necessity for this emergency measure, but the Commission, like other industries and services, cannot keep their charges static in the face of the rising cost of labour and materials. They are at present incurring a net revenue deficiency of something like £¾ million per week and it is clear that this cannot be allowed to continue. If the increase is not made, it will become progressively more difficult, if not impossible, for the Commission to fulfil their statutory obligation to pay their way.
While this increase in charges is necessary, and cannot be avoided by immediate economies which it is within the power of the Commission to make, the House will be aware that the Government is not satisfied that the structure of the country's transport system as a whole, is such as to secure the best and most economical service to the community. This whole question, which of course includes efficiency, is under close and urgent examination by the Government.
§ Mr. Alfred Barnes
This statement is in almost identical terms with that which I introduced earlier in the year. On that occasion, the then Opposition demanded a debate and the Government readily consented. Does it not make it indefensible, when the Minister proposes to make these alterations on 31st December, that the House should be dismissed without any opportunity to discuss them?
I want, further, to refer to two statements which the hon. Gentleman has just made. He admits that the Commission, like other bodies, must meet the rising costs of labour and materials. Then, in the latter part of his statement, he refers to proposed Government action. The only statement that we have so far had on proposed Government action is the handing back to private enterprise of those sections that are making a profit, whereas in this case the bulk of the burden is on the railways.
§ Mr. Maclay
The right hon. Gentleman refers to the fact that this statement is in similar terms to the one previous. That is true, but I am sure he realises that in four or five weeks it has not been possible to achieve all those economies which, we hope, will be ultimately achieved. On the question of the possibility of debate, this matter is debated—as I noticed was announced in the previous statement to which the right hon. Gentleman has just referred—when the Regulations are laid, because they are subject to annulment.
§ Mr. Maclay
I think it will be found—I say this with caution—that there was some considerable period before the Regulations were debated on the previous occasion.
§ Lord Malcolm Douglas-Hamilton
Would my hon. Friend bear in mind the tremendous burden which high transport costs have for a very long time imposed upon the Highlands and the North of Scotland? If the Commission are to get these rate increases in full, special consideration must be given to that area.
§ Mr. John MacLeod
Did not the Cameron Report go into this question very fully and make three recommendations? Have those recommendations been taken fully into account?
§ Mr. Maclay
Perhaps hon. Members will study the paragraph of my statement which deals with the maximum increase of 10s. per ton, which is specifically designed to help the more distant parts of the country.
§ Mr. James Callaghan
As the Minister did not reply to the last part of the supplementary question which my right hon. Friend asked him, may I ask that when he reconsiders the structure of the transport industry he will also reconsider the proposals to denationalise part of road transport? Can he possibly explain how it can help the transport system, which can be efficient only if it is integrated, to hive off a part of it?
§ Mr. Walter Monslow
Does not the Minister now agree that co-ordination of inland transport is the only solution to the economic difficulties of the railway industry, and that the Government have no consideration for transport or for railways in particular if they take off road haulage?
§ Several Hon. Members rose—
§ Mr. Callaghan
As we cannot debate this matter now, and as we cannot move the adjournment of the House, may I ask how soon it will be before the Government either give us a chance to debate the statement, or take off some of the very thin subjects they have put down for the first week after the Recess and give us a chance in that way?
§ Mr. Aneurin Bevan
On a point of order. Is not it a misuse of the statutory duties that the Minister has to carry out to use an opportunity of this sort to make general observations which have nothing whatever to do with those statutory duties, and to leave the House of Commons for two months with that statement over its head, without an opportunity to discuss it?
§ Mr. Bevan rose—
§ Mr. Bevan rose—
§ Mr. Bevan
Yes, Sir. I wish to make a further statement. It is a very difficult position in which the House is put if a Minister makes a statement involving political considerations which the House is not in a position to counteract, or debate, or discuss in any way. When a Minister makes a statement carrying out his statutory duties he should confine himself to that and that alone.
§ Mr. Speaker
I may say that Ministers' statements made at this late hour have been a cause of difficulty to the House ever since I have been a Member 2577 of it. I see no way in which this matter can be debated, as there is no Question before the House. That is the effect of it from my point of view, and that is why I cannot allow a debate.
§ Following is the memorandum:
1. By a letter dated 23rd November you requested our advice on a proposal made by the British Transport Commission that they should he authorised under Section 82 of the Transport Act, 1947—
(a) to make the increases in railway freight rates and charges described in the Commission's memorandum in the manner following—
- (1) A general increase of 10 per cent. (except as hereunder provided) on existing rates and charges, including miscellaneous charges, in respect to merchandise traffic by goods and passenger trains, subject to a maximum increase of 10s. per ton in the case of merchandise by goods train and perishable traffic by passenger train.
- (2) An increase of 50 per cent. in the existing scale of additional charges in respect to small parcels (other than returned empties) by goods train ("smalls" bonus). This is estimated to be equivalent to an increase of approximately 20 per cent. on this class of traffic.
- (3) An increase of 50 per cent. in the existing charges for the carriage of returned empties."
(b) to increase by 10 per cent. all the harbour, docks, piers, canals and inland waterways charges now in operation which are regulated by statutory provisions.
§ 2. In your letter you informed us that you were impressed with the importance of taking the earliest practicable steps to prevent the financial position of the Commission from becoming unmanageable and asked that our advice should be tendered as soon as possible.
§ 3. If we may be permitted to say so, the request for our advice as a matter of urgency has placed us in some difficulty.
§ 4. We are on the point of concluding a public hearing into a Passenger Charges Scheme submitted by the Commission. We shall, therefore, in the reasonably near future have in effect to decide what, if any, additional contribution can he expected of passengers in relief of the evident financial necessities of the Commission. In these circumstances we do not think it would be right for us to enter upon any detailed discussion in this memorandum of the extent of those necessities.
§ 5. All that we think it proper to say at this juncture is that as a result of the examination of the financial position and prospects of the Commission which the public inquiry has involved and of the additional information in the Commission's memorandum we are satisfied—
- (a) that the general considerations advanced by the Commission are in substance well founded:
- (b) that upon such an estimate as is possible in the circumstances of the moment the annual deficit of the Commission at the existing levels of freight and passenger charges would prove to be not less than £35m. and might well be £40m.:
- (c) that whatever additional revenue it may be equitable and practicable to obtain from the passenger services can do no more than alleviate the financial position of the Commission:
- (d) that there is at present no prudent alternative to an increase in freight charges aimed at providing in a full year additional revenue of the order of £20m.:
- (e) that a general increase of 10 per cent. on existing rates and charges is the best available means of meeting the Commission's necessities.
§ 6. We are not satisfied that there is any sufficient justification for imposing what is in effect a special surcharge on the small parcels and returned empties traffic.
§ 7. We recommend accordingly that regulations he made as soon as possible authorising the Commission to make—
- (a) the additional charges described under head (1) of the "Proposals" set out in paragraph 1 (a) of this memorandum, subject to the deletion in head (1) of the words "(except as hereunder provided)", and,
- (b) the additional charges specified in paragraph 1 (b) of this memorandum.
§ HUBERT HULL.
§ A. E. SEWEI.L.
§ J. C. POOLE.
§ 3rd December, 1951.