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Nationalised Industry (Organisation)

Volume 440: debated on Tuesday 22 July 1947

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Motion made, and Question proposed, "That this House do now adjourn."—[ Mr. Popplewell.]

10.49 p.m.

It has become practically a custom in this House in a Debate on the Adjournment, for a Member to apologise for keeping the House. I do so, none the less, on this occasion. It is a custom also for hon. Members to seek to justify detaining the House on the score of the importance of the matter to be raised. The question of the organisation of our nationalised industries is one which is going to affect, as I see it, very vitally the productivity of this country.

In the Debate on the productivity of labour, the Lord President of the Council used the phrase "produce or perish," a phrase which has been 'bandied about rather freely. At the present time, in view of the seriousness of the situation facing this country productivity is vastly important. In that Debate, the Lord President of the Council referred particularly to the productivity of the coal industry. That industry's productivity is going to be affected very considerably by whether nationalisation is going to be successful or not. The Government have embarked on a scheme of nationalisation and I think we are justified in asking ourselves whether it will really produce the goods; in other words, will the industry be more productive than before? We have got to see that the productivity of the coal industry is vitally important, otherwise we are going to be up against an extremely serious economic situation. The Minister of Fuel and Power, during the time that the Bill for the nationalisation of the coal industry was before the House, referred to this move into nationalisation as somewhat of an experiment. Anything that is an experiment involves the possibility of success or failure. I believe that this need not be an uncertain experiment. I believe that we have the experience in this country to ensure that nationalisation will be an unbounded and overwhelming success. But it will only be a success if we do really learn from the experience of running large-scale industry, and benefit from it.

So far I believe, nationalisation has come to the people of this country only in name. It does not really mean anything vital to them. The test will be whether it succeeds, and whether the people, as consumers or producers, feel that nationalisation is something vital which concerns them. For instance, take the example of the L.P.T.B. If we get into conversation with bus drivers and conductors, so far as one can gather nationalisation does not give them a sense of responsibility which brings out the best in them. This is shown in the disturbances and unofficial strikes which occur. The opinion of the public, as yet, is such that they do not feel that sense of enthusiasm they should feel for an industry which is publicly owned. It is a questions once again that the proof of the pudding is in the eating. It is no use just passing a Measure to nationalise industry unless we can ensure that the method of running it afterwards is going to be exemplary in every detail.

When the present Parliament assembled two years ago, I realised that it was going to be vital to this Government that we should show at an early date that those industries could be well run after they had been nationalised and I got together a small group of industrialists who had really first-hand managerial experience in industry, and those who had experience as industrial consultants, and a certain number of hon. Members from this side of the House who had experience in running industry. It is noticeable that there is no Member of the Government with executive experience at the head of large scale industry. I make no reflection on the Cabinet for this, since it is merely the force of circumstances that has brought this situation about, and there is no blame attaching to them, but it does impose obligations on the Government, as I see it, to take note of the experience of industry, in getting their ideas and suggestions from those with proved ability, and to apply it to the way in which our nationalised industries are run.

Before the Civil Aviation Bill came to the House this group of individuals had some useful suggestions to make on the best of running nationalised industry, and put forward a memorandum to the Minister concerned. Unfortunately the Minister of Civil Aviation took little or no notice of these suggestions, and I think it is, in some measure, on that account that the Act has not proved the success it might have been. The present Minister of Civil Aviation has admitted to me—and I am giving away no secrets—that the Act for our nationalised civil aviation has, in some instances, proved a serious failure. It did not incorporate, and it did not give an opportunity for, the new management principles to be developed, and such things as a fully developed consultative system has consequently failed to come into being. It did not make it obligatory to incorporate these principles.

I believe that the Minister, through turning a blind eye and a deaf ear to these proposals, was led later to turn his back upon his own supporters. They argued vigorously for Amendments giving effect to these suggestions, and it eventually resulted that that particular Minister was turned out of his job. That fact indicates something of the seriousness with which some hon. Members on this side of the House view this particular problem. What we wanted was that there should be formed a fully representative advisory council, on a level with the Board of Control, in charge of each of the corporations. If that representative council had come into being, it would have enabled representations to be made to the corporations so that they would quickly absorb these new ideas of scientific management which some Members on this side of the House wished to be brought into effect in the nationalised industries immediately the Bills were passed.

I do not want to go into these methods too closely because it is largely a technical matter. Fortunately, the hon. Member for Reading (Mr. Mikardo) is now associated with the Air Transport Joint Advisory Council, and he is endeavouring, in an unofficial way, to do what the Bill failed to do. That however, unfortunately, is not providing a clear channel for suggestions to go forward to the corporations, nor is it the way to enable them to become effective immediately. It will now entail, unfortunately, a long process of education rather than a short one, as could so easily have happened if these corporations were used as a channel for these new and successful methods of organisation in socialised industry to be demonstrated.

Regarding the coal industry, a similar memorandum was passed by this group, with which I have been associated, to the Minister of Fuel and Power before the Coal Bill came to this House. Although it was turned down, it was interesting to notice that their suggestions lined up with the suggestions put forward by the Mine Managers' Association. This fact, I suggest, indicated that the suggestions we tried to make were of a practical nature based on ideas coming to those associated with the industry over a considerable number of years. In the Bill itself, adequate description was made of the executive side of the industry, the Coal Board, the regional boards, the district and area boards, down to the pits themselves, but no clear indication was given of the advisory and consultative side of the industry which modern methods have shown to be so vital, and which progressive industries are demanding and relying upon for a 'clear chain of contact on the consultative side with every man from the bench up to the management, just as in the past contact was maintained on the executive side by the board of management down through the managers, foremen and charge hands to the man at the bench. The one side can make orders and give introductions, while the other can watch problems which arise and help to clear bottlenecks, and this can be done through continuous advice and consultation taking place at every level throughout the organisation. I believe that the Bill should have incorporated some ideas on modern management methods of the type which I have just described.

Since nationalisation of the coal industry, I have visited a pit and sat at a joint production committee meeting. It was clear to me that some eight or ten members of that committee—and it was the only form of joint consultation that there was in that pit—were quite unable to bring their ideas intimately to the knowledge of some 2,000 men employed in that pit, and the result was that quite frequently there were unofficial strikes, and stoppages taking place from day to day, and week to week, which could easily have been avoided, by those who know joint consultation methods intimately, because a channel at every level from the coal face to the manager's office would have been provided for the clearing of grievances—on the spot where particular grievances occur.

I believe that the Minister of Fuel and Power at one time appreciated something of the need for giving an opportunity for the new management methods to express themselves in the coal industry, because before the Coal Board came into being he actually signed a minute in the Ministry giving support to the appointment of a number of personnel managers for the coal industry. The idea of those personnel managers was that they would work alongside the mine manager and relieve him of a great deal of the detailed work, particularly applicable to personnel problems I believe it to he a fact that under nationalisation, the mine managers are finding themselves grossly overworked and personnel managers could cover some of the particular defects which have arisen.

A certain individual who had experience in large-scale industry; particularly of personnel management, was about to be appointed to act as adviser to the Minister of Fuel and Power but because the Minister of Fuel and Power would not give him an assurance that he would be taken over by the Coal Board when it was formed, this man could not afford to risk not having a job if he was not taken over by the Board. In fact, he was prepared to sacrifice quite an extensive salary, which he could have got in private industry in order to undertake what he believed to be a public service in the coal industry. I believe it was an unfortunate thing that that particular adviser was not appointed.

I understand that in the North Midlands where a few such personnel managers are appointed, the executives of the Mineworkers' Union have advised that no notice should be taken by the mineworkers of the proposals put forward by these personnel managers. It is an unfortunate situation which has arisen and it would have been avoided if the Coal Board had given their backing to this idea of having personnel managers in the industry, a procedure which in those industries where it does apply has proved to be so effective in aiding production and improving staff relations. This matter was dealt with in a brief article in the "Observer" on 29th June, under the heading "The Man in the Mines." It was by C. A. Lidbury, and the writer indicated in that article that he knew from experience that improvement in the rhythm of production could come from the appointment of personnel managers. He also used these words in that article:—
"In 1943 Mr. Ernest Bevin—then Minister of Labour—spoke at an industrial conference of the immense part that personnel management could play in securing this rhythm by improving industrial relations, and he stated that no industry could afford to neglect this help."
He wrote that the President of the Board of Trade had frequently said similar things. He then went on:
"One would have thought that in the mining industry, where industrial relations have been so uphappy in the past, there would have been a crying need for this technique. Unfortunately, there is no sign yet of its application—in spite of ominous signs that output under the 5-day week is falling off."
I believe the defects to which I have referred would have been overcome if a real lead were given by the Coal Board. I believe it is not coming from the Coal Board because the members do not understand the new management techniques which have evolved during the past few years. They have been associated with the old way of running industry, which I might refer to as the "Powell-Duffryn" influence, and which in the minds of miners of South Wales is associated with the autocratic torm of control which was so unsuccessful in the past. The Powell-Duffryn group were not renowned for their particularly happy or efficient methods of operation On the other hand, there are those on the Coal Board with a Civil Service past. Those who have grown up in the Civil Service do not appreciate modern management methods. I note with dismay that a recent appointment to the Electricity Board is again to be of a senior civil servant who has done some splendid work in the Ministry of Civil Aviation but his background is not that of industry. It has been for long an assertion of the Labour Party that we do not intend to run nationalised industry as a a form of Civil Service. Yet here we see some of the most important posts being filled by those with a Civil Service procedure as their background, and they are being placed in charge of administration.

I believe we have to take a third course—a middle course between the autocratic and bureaucratic forms of management, namely, to provide some democratic form of control. We have to steer between the "Yes man" who traditionally served the autocratic powers of private industry in the past, and the" No man," who comes from the" no man's land "of Whitehall, and who makes a habit of saying" No "to every progressive suggestion.

During the past year, while the Coal Board has been operating, there have been tried three methods—exhortation, inducements such as special food for miners and the five-day week, and now threats of fines and imprisonment of those who participate in unofficial strikes or stoppages. I believe those are not the ways in which to get men to respond to their responsibilities in public undertakings. These three methods have all been tried, before attempting to employ the proved and successful ways of scientific management processes.

I want to give an opportunity for the Paymaster-General to reply, and am going to cut my remarks short and sum up by suggesting that in public undertakings we have to provide a new climate for the men to feel that nationalisation is something in which they can play an intimate and responsible part. If any Member of this House were to ask of anyone employed in a nationalised industry the question, "What does nationalisation mean to you compared with the previous conditions under which you worked?" I think he would find that the chief reaction was a sense of dissatisfaction and discontent. I feel that is due to a sense of frustration, due to the individual worker not being given an opportunity to express himself as an intelligent and vital member of a communal enterprise. Until the new boards appreciate that they have to take specific responsibility for introducing these new methods into nationalised industry, I think nationalisation will fail. In so far as nationalisation has been a main plank in this Government's policy, we shall not be able to make a good case out to the electorate when we next go to the country, unless we can show a marked change in the running of nationalised industry compared with that which applies to the methods of running it at the present time.

11.10 p.m.

The hon. Member has not left me a great deal of time to reply to such a widely ranging subject. However, I hope I may get an opportunity to say something more constructive and less argumentative than I might have been tempted to do if I had more time. I could not agree with everything the hon. Member has said. For example, I could not agree for a moment with his statement that nationalisation did not mean anything to the workers in nationalised industries. That was not the impression I gained in talking with miners recently in the Forest of Dean in South Wales, whence I come. Though I do not agree with the hon. Member that there has been nationalisation in name only, with no significant change to the workers in the industry, I will agree that the enthusiasm of the work-people in those industries for the nationally-owned undertakings needs to be canalised, if it is to have its full value. We wish to canalise that enthusiasm.

We accept in full the principle of joint consultation in industry. The Government want to foster joint consultation between the workers and the management in public, as well as in privately-owned, industries. My right hon. Friend the Minister of Labour, in these last few days, has been devoting a great deal of his time and attention in consultation with his National Joint Advisory Council to encouraging the speedy setting up of joint production committees, and the like, in privately-owned industries. We certainly wish to encourage the same sort of joint consultation in publicly-owned industries. I quite agree with the hon. Member that we should, in doing so, apply, where it is reasonably possible, the experience of successful privately-owned industry to the publicly-owned industries. But in doing so we must lay it down that in no case must this system of joint consultation between management and workpeople be regarded as a substitute for trade unionism; nor can it be used in any way as a substitute for the regular machinery of collective bargaining on wages and hours and conditions of work. Nevertheless, there is a field, even when these conditions are laid down, within which joint consultation in publicly-owned industries can be of very great value indeed. I must point out to the hon. Member that provision has been made in all the nationalisation Acts for joint consultation—for the provision of consultative machinery. In the Civil Aviation Act it is to be found in Section 19, in the Coal Industry Nationalisation Act, in Section 46, in the Electricity Bill now before the House, in Clause 53, and in the Transport Bill, in Clause 95. Each of these Acts or Bills lays on the Board of the industry the duty of consulting with the appropriate workers' organisations, to establish consultative machinery by agreement to cover such matters as the safety, health and welfare of the staff, and other matters of mutual interest, including
"the conduct of the operations they work at."
Those words are taken from the Coal Industry Act.

There is adequate provision, I think, in the Acts for the establishment of consultative machinery. In Civil Aviation, to which the hon. Member particularly referred, as a result of the passing of the Civil Aviation Act, there has been set up a national joint council for civil air transport, and under this system there are ten local and national panels covering pilots, engineering officers, draughtsmen, and so on. In that industry, as in the coalmining industry, provision has been made for joint consultation. In the coalmining industry, consultative committees have been set up on national, divisional, and pit levels, and these committees can discuss anything of mutual interest. They are entitled to get reasons for all that the Coal Board does; and I am sure that the Coal Board is trying to give the fullest possible information on production, research, welfare, finance and so on, to these committees.

As the hon. Member said, the Coal Board has appointed officers on divisional or regional levels to help with these consultative arrangements. The hon. Member says that the channels of consultation are not, in his experience good enough, and are not yet working smoothly enough. That may be so. I do not seek to deny it. We do not pretend that every one of these committees is, necessarily, working perfectly at the present time. Some time must be allowed for the working out of machinery of this kind. The Coal Board has been fully in control of the mines for only a few months, and it has taken over a very difficult responsibility in an industry with a tragic history of misconceived industrial relations. It can hardly be expected that in an industry with a history such as that, that in a moment of time, or a matter of days or only of months, it would be possible completely to change the atmosphere and transform the relations between the work-people and the management so that every pit works smoothly and every grievance is settled. We cannot escape the past history of the industry and we must, I am sure, use in that industry people who know and understand the atmosphere of the industry. I do not say that in that situation we should not take into account what is being done in other industries. I am sure we should. We cannot expect to build Rome in a day in this particular industry, where there is a long and tragic past history.

I feel convinced that the National Coal Board is moving towards a better system of industrial relations in that industry at all levels and that it is beginning in a proper way by obtaining and securing the confidence of the National Union of Mineworkers. Without that, we can make no progress in the mining industry. I think it would be a mistake—anxious though I am to see the best possible relations established in the industry—to try to advance too rapidly, to try to adopt too suddenly, too surprisingly, all kinds of experiments and ideas which may have been tried out in other industries. The men must be trusted to go slowly in this difficult work. Here as elsewhere, good managements can make joint consultation work. So tar as I have studied this subject, my conclusion on the question is that where there is a really good management, one can make joint consultation work, and in so far as coalmining and civil aviation and other nationalised industries are concerned, the task will be, in the first place, to secure good managements. A good management can make it work and with it, sometimes, one can work miracles.

I am sure that the way we are trying to proceed in this matter is the right way. I do not want the hon. Member for West Middlesbrough (Mr. Cooper) to think from what I have said that we feel that everything in the garden is lovely, and that there is nothing which needs to be done. I do not rule out the desirability of these industries studying the practice of other industries. I am sure that in the summer schools and similar educational efforts, the Coal Board will take the opportunity of introducing miners and managers to other industries in so far as they can learn something useful from them.

Question put, and agreed to.

Adjourned accordingly at Eighteen minutes past Eleven o'Clock.