§ 27. Mr. Usborne
asked the Minister of Transport whether he will circulate in the 134W OFFICIAL REPORT the reasons why the prices of secondhand motorcars cannot be controlled.
§ Mr. Barnes:
The proposal to impose price control on secondhand cars was frequently considered during the war years and rejected for the following main reasons:
- In so far as it might have been effective, it would have tended to defeat the object of making secondhand cars available at prices lower than those being paid. Owners of good cars who might otherwise have been ready to sell would have refrained from doing so and those in need of a reliable car would have found it even more difficult to obtain one.
- It would have been impracticable to fix any limits other than the list prices new, and this would have tended to level prices at the maximum with a consequent increase for poor cars otherwise obtainable at a lower price.
- Many dealers had made bonafide purchases at higher prices and it would have been unfair to forbid them to sell except at a loss.
- a black market would undoubtedly have been created and it would have been impossible to prevent the surreptitious inclusion of additional consideration in transactions.
- To make the control effective a system of licensing all sales whether by private individuals or by dealers would have been required. This would have been difficult to administer effectively, and would have required a substantial organisation.
These considerations still arise, though in different degrees, but the most serious objection to imposing price control at the present time is that it would be ineffective. If control were restricted to sales by dealers, as was done in the case of motorcycles, cars would continue to be sold privately at high prices. If control were applied to all sales, a black market would at once develop, and the setting up of a licensing system or other machinery necessary to check such a development would not be justified at a time when the 135W production of new cars is rapidly increasing.