§ 3.37 p.m.
§ Mr. Ian Gow (Eastbourne)
I beg to move,That leave be given to bring in a Bill to restore the National Freight Corporation and its subsidiaries to private ownership.The National Freight Corporation and the National Bus Company were set up under the Transport Act 1968. On 3rd August I sought the leave of the House to introduce a Bill to denationalise the National Bus Company. It will be a matter of great regret to the House that leave was denied to me.
Today it is the turn of the National Freight Corporation. Section 41 of the Transport Act 1968 places a duty on the National Freight Corporation to break even financially, taking one year with another. However, the Corporation has been almost consistently in breach of that duty.
In 1974 the Corporation made a loss of £16 million and last year it made a record loss of £31 million. During the seven years that the Corporation has been in existence it has made an accumulated loss of £51 million. The purpose of my Bill is to put a stop to loss-making on this alarming scale. The failure of the Corporation to fulfil its statutory duty ought to oblige the Government to draw the appropriate lesson, namely that there is too close a relationship between nationalisation and loss-making. In any circumstances a loss of £31 million would require a radical remedy. When even this Government are beginning to understand that the burden of public debt can no longer be sustained, I propose the radical remedy of denationalisation which would liberate the National Freight Corporation from the sterile control of the Treasury Bench.
There is no reason why the Corporation and its subsidiaries should not be run profitably. The Corporation does not have a monopoly position like the National Bus Company or British Rail. On the contrary, it accounts for less than 15 per cent. of the total annual freight movement in the country. Whereas the private sector has, in the nature of things, been obliged to make a profit over these 278 last years, it is the Corporation alone which has been run at a loss.
The whole history of the Corporation is one of a saddening gap between promise and performance. In its first annual report, for 1969, presented to my right hon. Friend the Member for Yeovil (Mr. Peyton) when he was the responsible Minister, the objectives of the Corporation were summarised as follows:Last, but not least, we seek to escape the frustrations and general failure which the Corporation will suffer unless it pays its way on a commercial basis.Later, the immortal words appeared:The fundamental aim at all times is to be non-monolithic, non-bureaucratic and non-subsidised.The following are not the words of an unknown Member from a seaside resort. They are the words of the Chairman of the Corporation reporting to the Secretary of State. He said that the reality has been that nationalisation itself has been…a bad practice reminiscent of mediaeval usury.You, Mr. Speaker, are a saintly man—
§ Mr. Gow
That is more than can be said for the Secretary of State. But the Chairman of the Corporation has described the financial structure of the Corporation as being usury reminiscent of mediaeval times. The last verse of Psalm 15, which is possibly engraven upon your heart, Mr. Speaker, reminds us that the man—and I suppose, also the Government—who shall not fail isHe that hath not given his money upon usury, nor taken reward against the innocent.The financial structure of the Corporation is usurious, and in permitting losses on this scale the Government are taking reward against the innocent—the taxpayer.
I do not blame the directors or the 44,000 men and women who work for the Corporation for these losses. They are the helpless victims of a system over which they have no control and for which they have increasing contempt. Fortunately, the ingenuity of man, with the support of the Conservative Party, has provided a ready solution. Competitive free enterprise and the disciplines of the market place will provide what the 279 politicians can never provide, a proper financial structure, sufficient investment, a competitive service to meet the needs of the public, and, above all, a profit.
It may be argued that my Bill will take up valuable parliamentary time. Not so. It will have two clauses only. There is no reason to believe that it will be delayed in another place. It will oblige the Secretary of State to sell the National Freight Corporation and its subsidiaries at the best possible price. Such a step would, to quote my right hon. Friend the Member for Sidcup (Mr. Heath), "at a stroke" reduce the Government's borrowing requirement and lighten the burden of the Secretary of State for Transport, who is not even in his place today. Indeed, if I had my way, I would continue the process of denationalisation of all the projects under his control so that he, too, would become redundant I commend the Bill to the House.
§ 3.45 p.m.
§ Mr. Robin F. Cook (Edinburgh, Central)
The hon. Member for Eastbourne (Mr. Gow) made great play of the fact that last year the National Freight Corporation suffered a deficit of £31 million. He follows these matters closely, and he must be aware that in the current year it has taken substantial strides towards reducing the deficit. [Laughter.] Clearly, hon. Members do not follow these things as closely as they might.
Only last Thursday, the Chairman of the Corporation, opening, I am glad to say, a new terminal in Scotland, announced that Freightliners Limited, which last year had lost £1 million, would have a surplus of £1 million this year. There is every reason to suppose that we shall see the National Freight Corporation as a whole moving from a deficit on trading account to surplus. In any year that would have been a remarkable achievement, but it is an even greater achievement in this year, a year of industrial recession, not marked by profitability in the private sector road haulage but rather by a large number of bankruptcies. Such a great achievement by the National Freight Corporation deserves better from this House than the hon. Member's doctrinaire jibes. We should pay tribute to the management and staff, who have worked together so well to bring about this achievement.
280 Even if we accept the depressing view of the hon. Member for Eastbourne that nationalised industries are necessarily associated with mounting and record deficits, he is proposing a curious remedy. He is saying that we should put up a sign at the headquarters of the Corporation, "for Sale", and that there should be a day when he gets up on a rostrum with a hammer and auctions off the Corporation in job lots. If he gets to that day, he will not find a shortage of buyers. At the start of the day, business men will be trampling over each other to get control of companies such as Pickfords, which last year declared, for the third year running, a record profit, and Tank Haulage, which doubled its profit last year. The Bill is being introduced because the private sector does not want to put up with the successful competition that these companies provide.
But as the day wears on, the bidders will get fewer. At the end of the afternoon, the hon. Gentleman will be left with National Carriers and Freightliners Ltd. He will then discover that there is only one bidder. There will be a moment of blind panic for him when he discovers that it is British Rail, from which National Carriers and Freightliners Limited came and which wants that business back on to rail. He will not want that, of course. He will then take National Carriers and sell it off in job lots. He will sell off the profitable assets, the attractive sites and the specialised lines, until at the end of the day he is left holding assets which no one wants and also the expensive commitment to the pensioners which no one will buy off him.
Thereby, we shall have a repetition of the experience of the denationalisation of British Road Services in 1953, when the nation was left with a loss-making company, with the profitable parts of the service sold off. Worse still, not only shall we be saddled with a loss-making enterprise but the hon. Gentleman will have destroyed a valuable national asset in a vital industry.
The National Freight Corporation is the one freight organisation in this country which straddles both rail and road. Many of us on this side of the House are disappointed that the Corporation has not shifted more traffic to rail, which was another obligation laid upon it by the 1968 Act. Indeed, only last year, National 281 Carriers halved the proportion of its traffic which goes by rail. It is difficult to reconcile that with the commitment it was given to put whatever scrap of freight it can on to the railways.
Nevertheless, if we are serious about wishing to turn our aim of an integrated transport system into reality, it makes no sense to dismember the one freight organisation which is intermodal on the principle of selling it to the highest bidder.
The hon. Gentleman said that the NFC is not a monopoly. That is right. However, he did the organisation less than justice in that respect. It is certainly not monolithic. It is genuinely regional in management structure. Nevertheless, it is by far the largest single major operator in the freight industry.
There are advantages to the whole industry in having one major operator with the sense of social responsibility that goes with being State owned. The NFC takes seriously, even if the Opposition do not, its role as a pacemaker in the haulage industry. In eight years, it has improved standards in conditions and standards of work, professional qualifications, technical innovation, such as the electrically operated Silent Karrier, and pioneered new markets such as waste recycling.
Moreover, the private sector recognises the valuable role of the NFC as a pacemaker within the industry. We know that, because the private sector is continually poaching Freight Corporation trained managers. We know it, too, because we have been through an extensive process of consultation on transport policy. In response to the consultative document, 1,000 replies were lodged with the Department. I defy the hon. Member
§ for Eastbourne to find one single document submitted by a significant haulage or road-based organisation which calls for the dismemberment of the NFC. There is not one.
§ Why does the hon. Member for Eastbourne seek to introduce such a measure? This is not the first Bill which he has introduced to denationalise a public undertaking. The hon. Gentleman has given us due warning that he intends to move through the public sector asking the question: what does it do and what can I do to stop it from doing it? It is a new dogmatism that anything which is public enterprise is bad and anything which is private enterprise is good.
§ Several times in the last month Labour Members have been asked by Opposition Front Bench spokesmen whether they have a committment to the mixed economy. I have no doubt about my commitment to a genuine mixed economy. Perhaps it is time that the Opposition Front Bench asked the hon. Member for Eastbourne and his colleagues whether they accept a mixed economy. In the meantime, I think that we should give the Opposition Front Bench the opportunity to stand up and be counted for the mixed economy by coming out in defence of the State's modest, but valuable, stake in the freight business.
§ Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of Public Business):—
§ The House divided: Ayes 165, Noes 168.283
|Division No. 343.]||AYES||[3.55 p.m.|
|Adley, Robert||Clark, William (Croydon S)||Farr, John|
|Arnold, Tom||Clarke, Kenneth (Rushcliffe)||Finsberg, Geoffrey|
|Atkins, Rt Hon H. (Spelthorne)||Clegg, Walter||Fry, Peter|
|Awdry, Daniel||Cooke, Robert (Bristol W)||Gilmour, Rt Hon Ian (Chesham)|
|Baker, Kenneth||Cope, John||Goodhart, Philip|
|Bennett, Sir Frederic (Torbay)||Cormack, Patrick||Goodhew, Victor|
|Benyon, W.||Corrie, John||Goodlad, Alastair|
|Berry, Hon Anthony||Costain, A. P.||Grant, Anthony (Harrow C)|
|Biggs-Davison, John||Crawford, Douglas||Grieve, Percy|
|Blaker, Peter||Crouch, David||Griffiths, Eldon|
|Boscawen, Hon Robert||Dean, Paul (N Somerset)||Grimond, Rt Hon J.|
|Bottomley, Peter||Dodsworth, Geoffrey||Grist, Ian|
|Boyson, Dr Rhodes (Brent)||Douglas-Hamilton, Lord James||Grylls, Michael|
|Braine, Sir Bernard||Drayson, Burnaby||Hall, Sir John|
|Brittan, Leon||Dunlop, John||Hall-Davis, A. G. F.|
|Brocklebank-Fowler, C.||Eden, Rt Hon Sir John||Hamilton, Michael (Salisbury)|
|Brown, Sir Edward (Bath)||Edwards, Nicholas (Pembroke)||Hampson, Dr Keith|
|Bulmer, Esmond||Emery, Peter||Hannam, John|
|Butler, Adam (Bosworth)||Eyre, Reginald||Harrison, Col Sir Harwood (Eye)|
|Carlisle, Mark||Fairbairn, Nicholas||Harvie Anderson, Rt Hon Miss|
|Clark, Alan (Plymouth, Sutton)||Fairgrieve, Russell||Hastings, Stephen|
|Hawkins, Paul||Mills, Peter||Shaw, Giles (Pudsey)|
|Hayhoe, Barney||Mitchell, David (Basingstoke)||Shelton, William (Streatham)|
|Hicks, Robert||Moate, Roger||Shepherd, Colin|
|Higgins, Terence L.||Molyneaux, James||Silvester, Fred|
|Holland, Philip||Monro, Hector||Sims, Roger|
|Hordern, Peter||Montgomery, Fergus||Sinclair, Sir George|
|Howe, Rt Hon Sir Geoffrey||Moore, John (Croydon C)||Skeet, T. H. H.|
|Hurd, Douglas||More, Jasper (Ludlow)||Speed, Keith|
|Hutchison, Michael Clark||Morgan, Geraint||Spicer, Michael (S Worcester)|
|James, David||Morrison, Charles (Devizes)||Sproat, Iain|
|Jenkin, Rt Hon P. (Wanst'd & W'df'd)||Morrison, Hon Peter (Chester)||Stainton, Keith|
|Jessel, Toby||Mudd, David||Stanley, John|
|Kershaw, Anthony||Neave, Airey||Steel, David (Roxburgh)|
|King, Tom (Bridgwater)||Nelson, Anthony||Steen, Anthony (Wavertree)|
|Knight, Mrs Jill||Newton, Tony||Stewart, Ian (Hitchin)|
|Lamont, Norman||Nott, John||Stradling Thomas, J.|
|Lane, David||Onslow, Cranley||Taylor, Teddy (Cathcart)|
|Lawson, Nigel||Page, John (Harrow West)||Tebbit, Norman|
|Le Marchant, Spencer||Page, Rt Hon R. Graham (Crosby)||Thatcher, Rt Hon Margaret|
|Lloyd, Ian||Paisley, Rev Ian||Thomas, Rt Hon P. (Hendon S)|
|Loveridge, John||Pardoe, John||Vaughan, Dr Gerald|
|Luce, Richard||Parkinson, Cecil||Wainwright, Richard (Colne V)|
|McAdden, Sir Stephen||Pattie, Geoffrey||Wakeham, John|
|McCrindle, Robert||Penhaligon, David||Walters, Dennis|
|Macfarlane, Neil||Powell, Rt Hon J. Enoch||Weatherill, Bernard|
|MacGregor, John||Pym, Rt Hon Francis||Wells, John|
|Macmillan, Rt Hon M. (Farnham)||Rathbone, Tim||Whitelaw, Rt Hon William|
|Marten, Neil||Renton, Rt Hon Sir D. (Hunts)||Winterton, Nicholas|
|Mates, Michael||Renton, Tim (Mid-Sussex)||Wood, Rt Hon Richard|
|Mather, Carol||Rifkind, Malcolm||Young, Sir G. (Ealing, Acton)|
|Maude, Angus||Roberts, Michael (Cardiff NW)||Younger, Hon George|
|Mawby, Ray||Roberts, Wyn (Conway)|
|Maxwell-Hyslop, Robin||Rodgers Sir John (Sevenoaks)||TELLERS FOR THE AYES:|
|Mayhew, Patrick||Rossi, Hugh (Hornsey)||Mr. Ian Gow and|
|Meyer, Sir Anthony||Rost, Peter (SE Derbyshire)||Mr. Nicholas Ridley.|
|Miller, Hal (Bromsgrove)|
|Allaun, Frank||Ennals, David||Mabon, Dr J. Dickson|
|Archer, Peter||Evans, Fred (Caerphilly)||McCartney, Hugh|
|Armstrong, Ernest||Evans, Ioan (Aberdare)||McDonald, Dr Oonagh|
|Ashton, Joe||Flannery, Martin||McElhone, Frank|
|Atkinson, Norman||Fletcher, Ted (Darlington)||MacFarquhar, Roderick|
|Bates, Alf||Forrester, John||MacKenzie, Gregor|
|Benn, Rt Hon Anthony Wedgwood||Garrett, John (Norwich S)||McMillan, Tom (Glasgow C)|
|Bennett, Andrew (Stockport N)||Garrett, W. E. (Wallsend)||Madden, Max|
|Bidwell, Sydney||George, Bruce||Marks, Kenneth|
|Bishop, E. S.||Gould, Bryan||Marshall, Dr Edmund (Goole)|
|Blenkinsop, Arthur||Graham, Ted||Maynard, Miss Joan|
|Booth, Rt Hon Albert||Grant, George (Morpeth)||Mellish, Rt Hon Robert|
|Bottomley, Rt Hon Arthur||Grant, John (Islington C)||Mikardo, Ian|
|Boyden, James (Bish Auck)||Grocott, Bruce||Millan, Rt Hon Bruce|
|Bray, Dr Jeremy||Hamilton, James (Bothwell)||Miller, Dr M. S. (E Kilbride)|
|Brown, Hugh D. (Provan)||Hardy, Peter||Murray, Rt Hon Ronald King|
|Brown, Robert C. (Newcastle W)||Harper, Joseph||Newens, Stanley|
|Buchan, Norman||Harrison, Walter (Wakefield)||Ogden, Eric|
|Buchanan, Richard||Hatton, Frank||O'Halloran, Michael|
|Callaghan, Jim (Middleton & P)||Heffer, Eric S.||Orme, Rt Hon Stanley|
|Campbell, Ian||Hooley, Frank||Owen, Rt Hon Dr David|
|Cant, R. B.||Horam, John||Park, George|
|Carmichael, Neil||Hoyle, Doug (Nelson)||Pavitt, Laurie|
|Carter-Jones, Lewis||Hughes, Robert (Aberdeen N)||Price, William (Rugby)|
|Castle, Rt Hon Barbara||Hughes, Roy (Newport)||Radice, Giles|
|Clemitson, Ivor||Hunter, Adam||Rees, Rt Hon Merlyn (Leeds S)|
|Cocks, Rt Hon Michael (Bristol S)||Irvine, Rt Hon Sir A. (Edge Hill)||Roberts, Albert (Normanton)|
|Cohen, Stanley||Irving, Rt Hon S. (Dartford)||Robinson, Geoffrey|
|Coleman, Donald||Jay, Rt Hon Douglas||Roderick, Caerwyn|
|Colquhoun, Ms Maureen||Jenkins, Hugh (Putney)||Rodgers George (Chorley)|
|Cook, Robin F. (Edin C)||John, Brynmor||Roper, John|
|Corbett, Robin||Johnson, James (Hull West)||Rowlands, Ted|
|Cox, Thomas (Tooting)||Johnson, Walter (Derby S)||Ryman, John|
|Cronin, John||Judd, Frank||Sandelson, Neville|
|Cryer, Bob||Kaufman, Gerald||Sedgemore, Brian|
|Davidson, Arthur||Kelley, Richard||Selby, Harry|
|Davies, Bryan (Enfield N)||Kilroy-Silk, Robert||Shaw, Arnold (Ilford South)|
|Davis, Clinton (Hackney C)||Lambie, David||Sheldon, Robert (Ashton-u-Lyne)|
|Deakins, Eric||Lamond, James||Short, Mrs Renee (Wolv NE)|
|Dean, Joseph (Leeds West)||Latham, Arthur (Paddington)||Silverman, Julius|
|Dempsey, James||Leadbitter, Ted||Skinner, Dennis|
|Doig, Peter||Lewis, Ron (Carlisle)||Small, William|
|Dormand, J. D.||Lipton, Marcus||Smith, John (N Lanarkshire)|
|Edge, Geoff||Litterick, Tom||Spearing, Nigel|
|Edwards, Robert (Wolv SE)||Loyden, Eddie||Spriggs, Leslie|
|Ellis, John (Brigg & Scun)||Lyon, Alexander (York)||Stallard, A. W.|
|Stoddart, David||Walker, Harold (Doncaster)||Williams, Sir Thomas (Warrington)|
|Stott, Roger||Walker, Terry (Kingswood)||Wilson, Alexander (Hamilton)|
|Strang, Gavin||Ward, Michael||Wilson, William (Coventry SE)|
|Strauss, Rt Hon G. R.||Watkins, David||Wise, Mrs Audrey|
|Summerskill, Hon Dr Shirley||Watkinson, John||Woodall, Alec|
|Taylor, Mrs Ann (Bolton W)||Weetch, Ken||Wrigglesworth, Ian|
|Thorne, Stan (Preston South)||Weitzman, David||Young, David (Bolton E)|
|Tierney, Sydney||While, Frank R. (Bury)|
|Tinn, James||White, James (Pollock)||TELLERS FOR THE NOES:|
|Tomlinson, John||Whitlock, William||Mr. Dennis Canavan and|
|Urwin, T. W.||Williams, Alan Lee (Hornch'ch)||Mr. Kevin McNamara.|
|Wainwright, Edwin (Dearne V)|
§ Question accordingly negatived.