I beg to move, "That the Clause be read a Second time."

This first new Clause is in substitution for Clause 3 of the Bill as it now stands. As hon. and right hon. Members who were on the Committee will appreciate, the Government have throughout been most anxious to meet as far as possible all the points which were put forward by the Opposition, so long as the general framework of the Bill was preserved. We were also very anxious to meet the arguments put forward by representative bodies who approached the Government about various points which were worrying them. This new Clause is an attempt to meet the criticisms and suggestions made during the Second Reading Debate about this important Clause, which lays down the general duty of the Corporation. It meets to some extent the Amendments put down on the Order Paper by the Opposition during the Committee stage. It meets, I believe fully, the fears and worries which were disturbing the main bodies of consumers of iron and steel.

The Clause as now drafted is sound, and sets out in a more precise way than did the original Clause what the general duty of the Corporation shall be. The major change is in paragraph (b), where it is specifically stated that the Corporation must avoid undue preference. During my Second Reading speech I stated that we did not anticipate—in fact we were confident—that the Corporation would not exercise undue preference between one consumer and another, and if by any chance they did so the Government have ample powers to stop them. Nevertheless, fears continued to be expressed by various people, including some of the main consuming industries that such undue preference might be shown. To make abundantly clear what Parliament intends we have inserted this provision in paragraph (b) in words which are sound and practicable and acceptable to the representatives of the main bodies of consumers. I therefore commend this new Clause to the House, and shall subsequently move the deletion of the present Clause 3.

Let me acknowledge straight away that we regard this new Clause as a considerable improvement on the original words used. I do not think that I need detain the House about paragraph (a). But under paragraph (b) the Minister has added words which are not, for example, in the similar Section of the Coal Industry Nationalisation Act. I refer to the words:

"…without prejudice to such variations in the terms and conditions on which those products are supplied as may arise from ordinary commercial considerations…"

So far I am with him, but then it goes on:

"…or from the public interest."

Those words enable the Minister to do almost anything. One of the most naive contentions which the Minister has put upon these matters is that the Corporation are to be the sole judge of the public interest. As a matter of fact, legis- lation about almost anything would be very simple if one could always be sure where the public interest lay. These words:

"…or from the public interest"

would enable the Minister to ride very wide on the matter of preferences.

The Minister no doubt will correct me if I am wrong, but I think the words are there because some undue preference may be required for the export trade. In trying to cover that point, I consider that he has unnecessarily widened the Clause. We on this side of the House will not divide against the Second Reading of this Clause which we regard as an improvement on the original, but at the same time I think that the words:

"…or from the public interest"

are too wide. When we come to discuss the Amendments, if they are called, the point will arise again. Perhaps I had better confine my remarks to saying that this is an improvement and that we shall not divide the House. The points about which I have given notice will arise on the Amendments.

I wish to ask the Minister if he will throw a little light upon the various mental processes that have been gone through before this Clause reached its present form. The right hon. Gentleman will remember that we had no opportunity in Standing Committee of discussing Clause 3 owing to the falling of the Guillotine. At a later stage, when considering a new Clause put forward by the Opposition, the Minister gave an undertaking that he would endeavour to incorporate that portion which is comprised in paragraph (b). In the notice given on 28th March of the new Clause which the right hon. Gentleman proposed to move, paragraph (a) was in the same form as it is now. But paragraph (b) which he then proposed to put before the House read:

"to avoid showing undue preference to, and exercising undue discrimination against, any consumer or class of consumers in the supply and price of those products."

At that stage he was not including the further sentence which appears in the present new Clause, but there was this proviso:

"Provided that the duty of the Corporation under this section shall not be enforceable by proceedings before any court or tribunal."

I have no doubt that the right hon. Gentleman considers most carefully before he puts a new Clause upon the Paper. I should like to know why upon the first consideration it appeared in the form to which I have just referred, and why he has added this extra proviso and deleted that with regard to the duty of the Corporation not being enforceable by proceedings before any court or tribunal. We are endeavouring to deal with something which I presume is the considered opinion of the Minister. I have no doubt that the form of words tabled on 28th March was the considered opinion of the Minister also. It would be interesting to know why there is such disparity between the new Clause now before us and the one suggested earlier.

Could the Minister give a little more explanation about the words in the second line:

"to promote the efficient and economical supply of the products."

These words first appeared in the Coal Industry Nationalisation Bill, and at that time a great deal of discussion took place upon what the Minister thought was meant by the term, "efficient and economical." The Secretary of State for War, who was then the Minister of Fuel and Power, said on 12th February, 1946:

"I am bound to say that if the Board are able and are competent, they are bound to be prudent and they are bound to safeguard the community against waste."—[OFFICIAL REPORT, Standing Committee C. 12th February, 1946; c. 994.]

Since then we have had some examples of how these boards of nationalised industries consider that they are dealing with waste. I can give instances where the moisture content of coal has gone up by 4 or 5 per cent. compared with previous allocations. I do not think that that is being economical or efficient, yet that is taking place under these very same words in a previous nationalisation statute. I would also refer the Minister to the Electricity Act where the same words appear. Yet we find that the cost of electricity has gone up considerably in a great number of cases. In Sheffield it has increased by nearly 60 per cent.

Does the Minister consider that the words, "efficient and economical" cover those large increases in prices and the great deterioration in quality? If he is satisfied that that is the best practice, I certainly am not. We should tighten up this wording. Up to now, these words have not proved efficient in making the Boards carry out their duties. I am not satisfied that the explanation given by other Ministers of the meaning of the term, "efficient and economical" is satisfactory. We should not pass this Clause until we have an explanation from the Minister of what he means by the term.

Will the powers given to the Corporation under this new Clause supersede the powers the Minister now has of allocating steel to certain industries? I put that question because of the attitude of the Ministry towards the supply of steel for steel houses. In the Report of the Department of Health for Scotland this year we are told that the supply of steel for this purpose has completely ceased. We in Scotland have a grave grievance. We believe that the supply should be continued. In this new Clause there are the words:

"to further the public interest in all respects."

I should like to know whether the Corporation will have power to secure a more reasonable allocation of steel for the places where it is most needed.

The Minister made a very bland speech—one which we always get on nationalisation Measures—in which he said that he was confident that he had settled the worries of the consumers. If he is really confident of that, he is confident of something which is most remarkable. If you will look at these words, Mr. Speaker, you will see why people are so extremely worried. This Clause lays a duty on the Corporation to supply steel at such prices and qualities

"as may seem to the Corporation best calculated to satisfy the reasonable demands of the persons who use those products…"

We have examples of what is happening under nationalisation. For instance, there is the example given by the Chairman of the Cunard Company last week in which he pointed out that bunker coal in New York is 61s. 3d. a ton and in London it is 98s. a ton. I should like to know from the Minister whether the Corporation would think that they had carried out this Clause if there was in their prices such a disparity as is now evident in the prices of coal produced in this country compared with world prices. If he is satisfied about that, all I can say is that no consumers of steel will be satisfied. If he thinks that history is going to repeat itself, we may as well pack up world trade altogether.

May 1, by leave of the House, answer one or two of the points which have been raised? The hon. Member for Ecclesall (Mr. P. Roberts) dislikes the words "efficient and economical supply," and suggests that they should be tightened up. I do not think he can have read very carefully or followed fully the proceedings during the Committee Stage, because those words were not in the original Clause put down by the Government, but they were in the Amendment put down by the Opposition, and it was in order to meet the views of the Opposition on this point that I incorporated the words of their Amendment into this new Clause. It is strange for them now to complain of words which I have only incorporated because the Opposition wanted me to do so.

I was not complaining of the words. I wanted to know what interpretation the Minister put upon them. These words have been in other nationalisation statutes of which we know, and what I wanted to know was what the Minister understands by these words now that he has incorporated them in is own new Clause.

I think that is a point which should be further pursued on Third Reading, and perhaps hon. Members of the Opposition, who suggested these words, will say why they wanted them incorporated in the Bill. That duty rests firmly upon them.

I can assure the hon. Member for South Ayrshire (Mr. Emrys Hughes) that this Clause will in no way interfere with any steel allocation scheme operated by the Government. The allocations under the present scheme are the Government's responsibility, and that responsibility will not pass from the Government. The third point raised was on the question of a possible disparity of prices which it is suggested might arise, and which worried the hon. Member for Flint (Mr. Birch). One cannot say what disparity of prices may or may not arise, but the duty is put upon the Corporation to see that prices are as reasonable and fair as can be. The hon. Member will realise that if the prices did appear to be out of line with world prices, there is ample machinery through the Consumers' Council and through Parliament, because the Minister has a responsibility here to see that those prices are not allowed to go too high. I do not think that we need worry about that matter under this new Clause.

The Minister has still left the interpretation of these words very vague. I think the right hon. Gentleman ought to pay some attention to the fact that, in regard to other nationalised industries and particularly coal, the quality has got worse and the price has gone up. Is that his interpretation of the economical running of the industry, because, if so, it is not mine? If we take the case of electricity prices, the same thing exists, and I do not think there is an hon. Member in the House who has not had complaints of the fact that electricity charges have risen very steeply. Only this morning I received a letter from the chairman of an Area Gas Board telling me that he is willing to answer any questions I should like to put, and informing me that it may be that, in some cases and some parts of the country, gas charges are likely to go up. If this is what the Minister understands by nationalisation, let him say so openly and tell the House that prices are likely to go up.

Will the hon. Gentleman allow me? I received a similar letter, and I wonder if his said, as did mine, that that rise in prices would have happened nationalisation or no nationalisation?

I am used to that phrase, because when the product of any nationalised industry goes up in price, it is always stated that it would have gone up under private enterprise.

Is it not a fact that the Liberal National Party have said that the price had gone up even before the product was nationalised?

The hon. Member must not blame me for what the Liberal National Party says. I am speaking for myself alone, and I say without hesitation that, if the nationalisation of industry which we have experienced up to now is any criterion of what is going to happen to iron and steel, the consumers of iron and steel can now look forward to increased prices, poorer quality and less quantity, and if that is what is understood by the economical running of the industry, then it is up to the Minister to say so. Since the Minister has accepted the words suggested by the Opposition, he must have some idea of his own interpretation of them, and I want him to tell the House what he understands by them. It may be a very different thing from the interpretation that we put upon those words. If the industry is not economically run in the true sense and in the best interests of trade and industry, I say that the nationalised industry is already doomed to destruction.

I was delighted to hear that the Minister had accepted the inclusion of the words "efficient and economical supply," and I am glad that he has had the courage to allow some of the ideas of the Opposition to percolate into this Bill. I was not in the least surprised that he was quite unable to explain them to the House at this point, which would seem to be the only point at which he could do it properly, or that he could not say what is the meaning of those words. If he had been able to do so, he would have been much better briefed than usual, because every one of us, and particularly hon. Members on the other side, know that, in the running of the nationalised industries so far, the last thing which the Ministers have ever done has been to run them either economically or efficiently. I thank the Minister for the bland way in which he explained his ignorance and lack of knowledge of the meaning of these words. This is merely another illustration of the way in which this Government are plunging into these difficult matters and trying to run one of the most efficient and economical industries of this country into complete inefficiency and complete incompetence.

I was surprised to hear the Minister say that the new Clause would dispose of the fears of consumers. I do not know any consumers who are satisfied with this Clause which allows such power in the hands of the Steel Corporation, and I think we should try to seek a more desirable form of words. What are these words in paragraph (a) but pious hopes? What sanction is there behind any of these aspirations? What is going to happen after a year or so? This Board will go exactly the same way as any other nationalised industry under a State monopoly. It does not matter a tinker's cuss what motto is stuck on the wall of the State monopoly; it is going to go exactly the same way, whatever the motto. While we seek to do what we can to tie the Corporation up, we fully realise that there are inherent evils in State monopolies, and we should be very mindful of such aspirations as are contained in the wording of this new Clause.

The right hon. Gentleman has suggested that the sanction behind this new Clause was the sanction of Parliamentary control through the Minister. I should like to ask him a simple though I think not very easy question. Is it his expectation that questions put on this point would be in order in the normal and ordinary way, or would such questions be written off as being attempts to inquire into day-to-day administration, and therefore a matter for the Corporation and not the Minister? It was the Minister who advanced the argument in favour of the new Clause that there would be the sanction of Parliamentary inquiry, and I think he owes it to the House to tell us whether he expects that such questions would ordinarily be in order.

should like to put one or two points to the Opposition. Is it not the case that in pre-war days the big steel firms of this country showed undue discrimination in regard to prices and supplies? That is one of the points which has been dealt with in paragraph (b). With regard to the words in paragraph (a), the Opposition have accused the Minister of displaying his ignorance and lack of knowledge of the subject; but when hon. Members opposite continue to say that they do not understand what is meant by the words:

"to promote the efficient and economical supply of the products…"

they display their ignorance and lack of knowledge of the subject. Is it not obvious that so long as this industry was left in the hands of private people and this House or any public body had no control over it, or any say in it—

I wish to intervene only for a moment to correct the hon. Member on this point. Since the Import Duties Advisory Committee, which was set up in 1934, regulated all the prices to the steel industry and the Ministry of Supply, through the Iron and Steel Board, have done it since that Committee ceased to exist, I think the hon. Member is stretching his imagination rather more than usual when he says that there is no public control over the privately-owned steel industry.

It is perfectly true that the consumers of the products of this industry did have to come to this House and lobby hon. Members in order to get a particular Measure passed by Parliament to give them some protection against the people who are now squealing about nationalisation. That is perfectly true; I admit that, and I am not stretching my imagination. The reason they came and asked successive Tory and Liberal Governments for that protection was because of the rapacity and the unconcealed greed of the steelmakers of Great Britain. In the first place, therefore, we must not forget that this was only a section of an international cartel which agreed on prices and on the markets to be divided among them. They agreed that if people wanted certain commodities produced by the steel industry they would have to go to particular makers to get them. Consequently, the consumers had to compel Tory and Liberal Governments to give them some protection against the steel manufacturers of their own country. Now the Opposition say that they do not understand the meaning of the words:

"to promote the efficient and economical supply of the products…"

As a matter of fact, if the steelmakers of Great Britain had had the welfare of the nation at heart and had entered into competition with other countries, we should have had our 14 million tons of steel in 1935 instead of in 1949. That could have been done quite easily, but they did not do it. Why? The answer is that the only things about which they were concerned were the international cartels, their monopoly, and their own greed. Therefore, to say now that they do not understand what this Clause means shows that they are either too stupid or too naïve.

In my short membership of this House, I have many times been grateful for the fact that I am not a Minister, but never more markedly than this afternoon because, in considering the comparatively simple new Clause in the course of this very short Debate, my right hon. Friend has been asked by the Opposition to do four quite different things. Some hon. Members opposite have merely asked for a definition of certain terms used in the Clause. The hon. Member for Ecclesall (Mr. P. Roberts), unsatisfied with the definition, wants these terms to be got rid of and replaced by something else. The hon. Member for Bucklow (Mr. Shepherd) wants no more than to tie up the Corporation, to use his own words, which is apparently his method of setting the people free. Finally, the hon. Gentleman the senior Burgess for Cambridge University (Mr. Pickthorn) asked the Minister to give a Ruling on a point of Order which, I understand, Mr. Speaker, only you would be competent to rule upon. I repeat that I am more than ever grateful for the fact that I am not the Minister in charge of this Bill, and that I have not to deal with such a disorganised and disparate Opposition.

beg to move, as an Amendment to the proposed Clause, in line 1, after "powers," to insert:

"and of each subsidiary of the Corporation so to act."

After that little preliminary canter, perhaps we may now get back to an endeavour to improve this very indifferent Bill. The new Clause proposed by the Minister purports to do two things; it purports, in paragraph (a), to replace Clause 3 as it at present stands in the Bill, and in paragraph (b) to deal with the suggestion made by the Opposition in the Committee stage regarding undue preference. But the opening words of the Clause are:

"It shall be the general duty of the Corporation so to exercise their powers as"—

to produce these two objects; first,

"to promote the efficient and economical supply of the products,"

etc., and, secondly,

"to avoid showing undue preference to, and exercising unfair discrimination against…"

In order to make this Clause effective, we propose to insert after the word "powers" in the first line, the words:

"and of each subsidiary of the Corporation so to act."

The opening words would then read:

"It shall be the general duty of the Corporation so to exercise their powers and of each subsidiary of the Corporation"—

that is, of course, the 106 companies whose names are set out in the Third Schedule to the Bill—

"so to act"

as to carry out the objects described in the Clause. Hon. Members will, of course, want to know what are the powers of the Corporation which it is

"the general duty of the Corporation so to exercise"

as to produce these results. But hon. Members who have not been with us throughout the Committee stage might, in their simplicity, imagine that the powers of the Corporation were those set out in Clause 2 of the Bill, which bears the title "Powers of the Corporation." However, they would he mistaken, because the Minister has now decided virtually to scrap Clause 2 of the Bill as well as Clause 3, and, in order to find out what are now to be the powers of the Corporation, hon. Members will have to turn to pages 1668 and 1669 of the Amendment Paper and look at the marshalled list of Amendments set out thereon to find what are the words which the Minister now proposes to introduce in place of the two first subsections of Clause 2 as printed for the Report stage.

The Minister's new Clause makes a complete revolution in the proposed powers of the Corporation. To put the matter in a single sentence, it now appears that the main, if not the only, power of the Corporation is to act as a holding company. During the Committee stage, we had a great deal of discussion upon the question whether the Corporation were themselves to become producers of iron and steel, and so forth, or whether they were merely to act in the capacity of an investment trust company. It now appears from a study of the proposed new Clause on page 1668, and a comparison of that Clause with Clause 2 as it at present stands in the Bill, that the Minister has now finally come round to the view that the main, and probably only, object of the Corporation should be to act as an investment trust company, to hold the shares of the 106 companies whose names are set out in the Third Schedule, to exercise pressure upon those companies only by virtue of being the sole shareholder in them, and to leave those companies to carry on their operations in the normal way, subject only to any guidance they may obtain on questions of policy from the sole shareholder, which will be the Iron and Steel Corporation. In order to carry hon. Members with me and to show the immense change made in the powers of the Corporation by the Minister's new proposal, I would ask them, first, to look at Clause 2 as it now stands and to read the opening words, which are:

"…the Corporation shall have power to carry on any of the activities specified in the first column of the Second Schedule to this Act"—

and those, broadly speaking, are the production of iron ore and steel—

"and any other activities which any publicly-owned company…is for the time being authorised by its memorandum of association…to carry on:"

All lawyers know that in drafting a memorandum of association one makes it cover every conceivable possibility and that a modern memorandum of association contains powers to do absolutely anything. The original proposal in the Bill was that the Corporation should enjoy the same powers as those which each of its 106 subsidiaries enjoyed by virtue of their memoranda of association.

If hon. Members will now look at the proposals of the Minister, which are to be substituted for the first subsection of Clause 2, they will see that they are as follow:

"The Corporation shall have power—

(a) to hold such interests in companies as vest in them under Part II of this Act…

(b) to form, or take part in forming, any company for the sole or main purpose of the carrying on by the company of any activities which any publicly-owned company"

can carry on—

"(c) to exercise all rights conferred by the holding of interests in companies"—

—that is to say, to exercise what is the ordinary power of the shareholder.

Under subsection (2) of the Minister's proposed new Clause:

"The Corporation shall have power—

(a) to conduct research…"

and

"to provide for the publicly-owned companies…services which…can conveniently be provided as common services…"

The second power of the Corporation, as now proposed, is to conduct research upon a joint basis and to furnish common services if it is Convenient so to do, and it is only under subsection (3) of the proposed new Clause that

"The Corporation shall have power…to carry on any other activities which…any publicly-owned company is authorised…to carry on."

Let hon. Members note that the Corporation can go outside the powers laid down for holding shares and for conducting research and providing common services only with the consent in writing of the Minister. Only as an exceptional matter and with express Ministerial consent can the Corporation enter into any direct trading operation of any sort or kind. It is for that reason that we seek, in order to make the new Clause now before the House effective, to make it binding not only upon the Corporation but upon the 106 companies whose names appear in the Third Schedule and the many others, hundreds I think, of subsidiaries of this Third Schedule number, because it is obvious, for example, that it is no good laying down a general duty upon the Corporation to exercise its powers so as to avoid "undue preference to" any class of consumer if all the Corporation is to do, in effect, is to be an investment trust company and to hold shares in these 106 companies. Clearly, the obligation as regards "showing undue preference" or "exercising unfair discrimination" should and must be laid upon the 106 companies which will actually be conducting the trade and supplying the products.

I want to be clear on this point. We quite understand the change to be made by the Corporation becoming a holding investment company, but I cannot understand how the Amendment would affect subsidiary companies. We cannot make them holding companies within themselves.

I am sorry. The hon. Member has not quite followed the argument. Under the Bill we have the Iron and Steel Corporation. The 106 companies whose names appear in the Third Schedule—diminished, I think, from 106 by about half a dozen exclusions made by the Minister in recent months—will become 100 per cent. subsidiaries of the Iron and Steel Corporation, and our Amendment now before the House seeks to impose upon them these obligations in regard to promoting

"the efficient and economical supply of the products"—

and securing—

"that those products are available in such quantities, and are of such types, qualities and sizes…as may seem to the Corporation best calculated…to further the public interest."

I take it that the right hon. Member for North Leeds (Mr. Peake) is not using the word "subsidiary" as it is used in industrial circles, because a subsidiary of a company is a company in which the holding or parent company has a majority of the shareholding, whereas in this case the same set-up does not exist.

I am much obliged to the hon. Member. In point of fact, the only companies whose shares will be held by the Iron and Steel Corporation are the companies whose names appear in the Third Schedule to the Bill and in point of fact, also, the Iron and Steel Corporation will hold 100 per cent. of all the shares of those companies. It is quite clear, therefore, that the word "subsidiary" in our Amendment will apply to the companies whose names appear in the Third Schedule to the Bill.

I submit with confidence to the reason of the House that it is not much use putting obligations upon the Corporation

"to promote the efficient and economical supply"

of those products and to put obligations upon the Corporation

"to avoid…undue preference and…unfair discrimination…"

when the Corporation itself is now to be merely an investment trust company holding the shares for these various 100 or more producing companies. I submit with confidence that these obligations which the Minister clearly considers desirable and necessary—since he has promoted the Clause—should be laid upon those who will be in a position to carry them out and not merely upon the Iron and Steel Corporation, whose only effective power will have to be exercised by virtue of its holding the shares and holding all the voting power at the annual general meetings of these 106 companies.

I suggest that this Amendment is quite illogical. We are, under this Bill, setting up a new body, the Corporation, and in doing so Parliament must, of course, say what its powers and duties are to be. We are not interfering with the companies which are to come under public ownership; they remain ordinary public companies with normal obligations and the normal duties laid upon them by their articles and memoranda of association. There is no direct relationship between Parliament and these publicly-owned companies—none whatsoever. If we placed duties upon these companies, therefore, we should have no direct method of seeing that those duties were carried out. What we are doing is setting up a new body and imposing certain duties upon this new body.

By far the most important of the duties which we impose upon the Corporation are those derived from the power which it will possess, as sole shareholder in these companies, to order, broadly speaking, their affairs—to see that there is reorganisation and rationalisation, and to carry out those economy measures we have talked about on previous occasions. In that responsibility the Corporation will have full powers over these companies—not in matters of detail, of course, in which it will not want to interfere—but in all matters of general importance. We can, surely, logically give these duties only to this new body which we are setting up under this Bill and not to the various subsidiary and sub-subsidiary bodies with their continuing directorships, whose shares the Corporation are to hold.

We must tell the big holding body what Parliament expects it to do, and, therefore, we give it powers under Clause 2 to do certain things, and under the new Clause general duties and instructions which we want it to carry out. It will be the Corporation's responsibility; and it, and not the publicly-owned companies, will be responsible to the Minister and Parliament. This Corporation will be responsible for carrying out the duties which are imposed upon it, and it will have to see that the various companies whose shares it holds carry out the general duties which Parliament imposes—though these will be implemented, of course, through the companies whose shares it holds. Therefore, it is wholly right to put the responsibility on the Corporation, and it would be wholly wrong to put the responsibility on the many subsidiaries.

I am not quite sure what the word "subsidiary" covers here. I think it would cover much more than the 100 or so companies in the Third Schedule. Even if it were only these companies, it would be quite wrong to put the duty on their boards of directors, with some of them, it may be, interpreting the directions laid down by Parliament in different ways, with, perhaps, considerable dislocation and difficulty as the result. There might be chaos. That is not the way to proceed here. The duty must be put on the body we are setting up to run the steel industry in the public interest. We are putting that duty on the Corporation. I think the wording, "general duty," is wise. As I say, it has been agreed by the representatives of the consumers.

It would be wholly wrong, I suggest therefore, to try to put this duty doubly on the Corporation and on those various different companies, with whom we shall have no relationship whatsoever, over whom we shall have no direct control, and over whose behaviour neither the Minister nor Parliament will be able to exercise supervision, except through the Corporation. The Corporation must have the power, and alone must have the duty, of carrying out Parliament's intentions. I suggest, therefore, that we should reject this Amendment, and that, indeed: it is wholly illogical and unnecessary.

I have seldom heard a more extraordinary amalgam of arguments than this to which we have just listened. I pick out the first—"Quite impossible for the boards of 100 companies to interpret the obligations laid upon them by this Amendment." Of course, it is perfectly easy, in the Minister's opinion, for the boards of 100 companies to understand those general duties if they are told them by the Corporation. That argument does not hold water for a minute.

I am sorry if I did not make the point quite clear. The Corporation will be able by direction and discussion to elaborate and set out in detail what it expects these various companies to do. It will be in relationship with these publicly owned companies. Parliament will not. The Minister will not.

That is the second tier to the argument, to which I am now coming. The first part of the argument, to which I have just referred, has no validity at all. Of course, if a general duty is laid down by Parliament for the 100 companies, it will require, no doubt, some interpretation, and the companies may require some help from the Corporation; but to argue that because the duty is laid upon the actually operating companies that smelt iron ore and produce steel to carry out these provisions with no discrimination, they will not understand the duty unless it is laid upon them by the Corporation—to argue that they will have no understanding of a duty unless it is a general duty laid upon them by the Corporation—is to ask us to accept an argument of so tenuous a nature that I think that it is hardly worth discussion. I concede the Minister this, that it is quite clear that the 106 companies, in this relationship to one another which the Bill will cause, will have to have help from the Corporation, in the matter of exercising this duty. So much I give to him, but his main argument, to my mind, entirely falls to the ground.

The next contention that the Minister made was one of the most extraordinary I think I have heard—that Parliament has no relationship with the companies.

No direct relationship.

No direct relationship. Very good. There might well be solace for us on this side of the House if we had the least idea of what Parliamentary control is to be exercised over the Corporation through the Minister. We met on all sides of the Committee acceptance of the fact that, whatever one may think about it, it is quite clear that the relations of this House of Commons with these nationalised corporations is still—shall I say as politely as possible for the benefit of the hon. Member for Western Renfrew (Mr. Scollan)?—at least in a high state of fluidity. Nobody knows how far it will be possible to say to the Minister that on 15th July the prices of angles or of fluxes are too high. Nobody knows. I personally am optimistic enough—or foolish enough, if hon. Members prefer the term—to believe that one day we shall have to have that duty, but it certainly has not been worked out yet.

What the Minister says is, "We shall see that one day Parliament will exercise sore control through me of this Corporation, and that some day that Corporation, having been supervised in an uncertain manner by the House of Commons, will work in another way, which I do not propose to specify because the House of Commons is not concerned with its investments; and the Corporation will then be able to secure that the general duty that the Clause tries to lay down is in fact carried out." But everybody knows that this kind of cantilever system of responsibility will certainly not work, and the only control which Parliament, under the Minister's proposal, will one day get over these matters will be that of looking into all the various things that will have happened—perhaps, as much as six months after they have occurred.

We are to be put into that position of locking a very uncertain stable door long after the horse has gone. I really honestly think the Minister has made a great mistake in not accepting this Amendment. Agreed, that the exercise of these non-discriminatory powers is a matter of some delicacy when there are 106 companies concerned. However, why not lay upon them the duty directly? Thus we should get nearer to the centre of events than we are allowed to under the Minister's proposals.

Before the right hon. Gentleman sits down, may I ask him a question? He wants to amend the new Clause by bringing in "each subsidiary of the Corporation." Would he not extend his proposal by including in the Amendment, after the word "Corporation," the words "and all the managements and employees thereof," and so include all, right down to the fellows chucking the coal into the furnace or chucking the steel into the furnace? Obviously, the thing is ridiculous.

I always listen very carefully to the right hon. Member for Aldershot (Mr. Lyttelton) because, although I disagree with his political views, I think it is generally accepted on both sides of the House that he knows something about industrial organisation. What I think is most annoying about his remarks today is that they involve the conclusion that no one on this side knows anything at all about industrial organisation. Therefore, he has put forward an argument which he knows in his own sphere of operations is quite without foundation. As he said, when asking my right hon. Friend to do certain things, private monopolists, such as Imperial Chemical Industries and Unilever, have very large shareholdings dispersed throughout the country. These private monopolies from time to time have purchased interests in other companies. They have literally hundreds of subsidiaries spread throughout the country.

4.0 p.m.

The general policy of these subsidiaries is laid down by the parent company—by Imperial Chemical Industries—but no one is going to suggest that shareholders in I.C.I. have any direct relationship whatsoever with the shareholders of the subsidiary companies. In fact, the policy of the subsidiary companies is guided directly by the parent company, and exactly the same position obtains in the circumstances which we are now discussing. The Iron and Steel Corporation is the parent company and owns the shares in the subsidiary companies, and upon the Iron and Steel Corporation must be imposed those duties which it is expected that the subsidiary companies should carry out. This does not work in any other way in private enterprise, and I do not see why the right hon. Gentleman should expect it to work in any other way in the case we are now discussing.

When listening to the Minister's remarks, I wondered whether he had recently read his own Bill. He appears to assume that Parliament has no power over publicly-owned companies, and that the only relationship that exists is between the Minister and Parliament and Parliament and the Corporation, and that, somehow, these publicly-owned companies are all in the blue. I would draw attention to the Clause in the Bill where there is directly laid down ministerial direction over public companies, and where actual legislation is foreshadowed by which Parliament directly intervenes with respect to these public companies.

Clause 18 states:

"Where any company specified in the Third Schedule to this Act…has without the approval of the Minister made…payments of interest or dividend on any of its securities…"

to various people, the Minister is given powers to intervene. Clause 21 states:

"Where it appears to the Minister that any company specified in the Third Schedule"—

that is one of the publicly-owned companies—

"does not fulfil the following condition…"

then certain consequences result. The Third Schedule itself lays down the various public companies which are to be nationalised and incorporates them into an Act of Parliament. It puts Parliaments in direct touch with these companies and instructs them to prepare themselves for nationalisation.

Finally, in Clause 51, we have the very words which my right hon. Friend has tried to incorporate into this new Clause, and to which the Minister objects, where it says that it shall be the duty of every company specified in the Third Schedule to this Act to furnish information to Parliament. That is a duty. Why does the Minister say that Parliament has no direct relationship with these publicly-owned companies? It is here set out in his own Bill, and all that we are seeking to do is to repeat the same principle in the Amendment.

I am very much alarmed by what the Minister has said. To turn round here, with millions of public funds to be put into the companies of a Corporation who are buying out the controlling interest in those companies, and to tell the House bluntly, as he has done this afternoon, that we have no direct touch with these publicly-owned concerns is, in my opinion, not treating public funds with the care with which they should be treated. If we have not some direct connection between Parliament and these publicly-owned companies, I think that, as Members of this House of Commons, we ought to see that we have, and that we have the same right to see what is being done with regard to the instructions to be carried out under this Bill.

It is an alarming situation when the Minister can say what the Corporation can do, but cannot express a view as to what these publicly-owned companies do, and when there is no direct touch with them so far as Parliament is concerned. I think that is a very alarming statement for a responsible Minister to make on a question in which nationalisation figures so often.

Would the hon. Gentleman say what direct relationship there is between the shareholders of Unilevers and the companies which are subsidiaries of Unilevers?

The hon. Gentleman does not seem to realise that there is a vast difference between private enterprise shareholders and public funds which are fleeced from the public to put into these nationalised industries. The shareholders in any of these large concerns are at liberty to sell their shares and to get out if they are not satisfied. I am told that I have a share in some of these nationalised industries. My share is going very cheaply to any Member of the House, if he likes to buy it.

The position is not apparently appreciated by the hon. Gentleman. Here we are dealing with public funds, and we have to get that into our heads. Private enterprise can do what it likes, provided that it complies with the Companies Acts and the shareholders are prepared to put up funds for subsidiary companies, but if the shareholders are not satisfied, they can get out and sell the shares. Here the general public are tied for life in these nationalised industries. It is an alarming statement for the Minister to say that he can control the Corporation or give these instructions to the Corporation but he has no power to give them to the publicly-owned concerns. I think that he ought to see that he does give these instructions, otherwise the proposed new Clause does not mean half what it is suggested to mean.

I wonder if the Opposition have read their own Amendment. I notice that one of the things that each company would have to do if the Amendment were accepted would be to secure that products were available in such quantities and of such types and at such prices as may seem to the Corporation best calculated to satisfy the reasonable demands of the consumers. I find it very difficult to see what the position is of the individual companies if each of them has to carry out this obligation, not according to their own views and not according to any abstract principle, but according to the views of the Corporation.

Moreover, when I look at the rest of the Amendment I see that if these obligations were accepted, each one of the companies would have to promote the efficient and economic supply of the products of what I might call the Second Schedule activities. In fact, when one looks at these subsidiary companies some of them are carrying on a general business and others are carrying on specialised business. What is the point, and what is the sense, in putting on an iron ore mining company, such as some of these are, the obligation with regard to supplying finished or semi-finished steel. It seems to me to make complete nonsense of the proposed Clause.

As regards the effect of it, surely it is clear to everyone that the Corporation controlling these subsidiaries has power to carry out this obligation and is, indeed, the only body that can carry it out, for it is a general obligation and not one appropriate to these particular companies. As regards the relations between this House and the subsidiaries, it is interesting to note that hon. Gentlemen opposite desire a degree of Parliamentary control and interference which surprises me. The hon. Member for Hallam (Mr. Jennings) has just asked, if I understood him rightly, that Parliament should have power to control and interfere with the ordinary day-to-day workings of these companies. If he did not say that, I really do not know what he meant.

I think that the hon. and learned Gentleman is misstating our point of view. I went so far as to say that the relation with regard to day to day business, and so on, between this House and these companies remains still entirely undefined. I think that is an extremely difficult matter. I do not think for one moment that this House ought to surrender a power to look into day-to-day matters. On the other hand, too great an exercise of that power would make the workings of these Corporations impossible. These, however, are arguments against nationalisation, but not against the general proposition.

When making those remarks the right hon. Gentleman ought to have turned round and addressed them to the hon. Member for Hallam, who was sitting just behind him, and to whose speech I was referring. I am well aware that hon. and right hon. Gentlemen opposite have very different views of these matters, that some of them want one thing and some another but what I was saying was directed to the remarks we have just heard from the hon. Member for Hallam. I repeat, with respect to him, that I am surprised to hear from his lips this wish for Parliamentary interference, as I understood it, in the day-to-day activities of these companies.

The hon. and learned Member is misquoting me. I never, in any part of my speech, mentioned anything about day-to-day activities. I hope he will withdraw that remark.

I would not for worlds misquote the hon. Gentleman. All I can say is that if what he put forward did not mean and imply what I have said, I am afraid that I, for one, entirely failed to appreciate his point, and I think that feeling may well be shared by other hon. Members.

Surely the sense of this business is that, under Clause 4 this House has, through the Minister, control over the workings of the Corporation. That must be the right way to do it. It is quite impossible for a body such as this House to supervise, by means of Parliamentary control, the operations of some 100 companies, some of them large and some of them small, carrying on every sort of activity connected with this technical and multifarious industry.

Before we proceed to a Division on this Amendment, I should like, as the mover of it, to say a few words in reply to one or two of the arguments advanced against it, particularly those advanced by the hon. and learned Member for Kettering (Mr. Mitchison). The hon. and learned Gentleman always comes to the rescue of the Government when they are trying to defend an indefensible position, and he usually succeeds in making the position even more indefensible than it was before. In this case he completely answered his own first argument by producing his second argument. His first argument, as I understood it, was that it would be very unwise to lay upon one of these 106 companies in the Third Schedule—which he, for some reason or other, imagined would produce nothing but roadstone, or something of that sort—

Ironstone.

Well, ironstone, if the hon. Member prefers it.

My hon. and learned Friend said ironstone.

Perhaps I might remind the right hon. Gentleman that iron is made out of ironstone, not roadstone.

I am obliged to the hon. and learned Member. Let us then take his example of ironstone. His argument apparently was that this Amendment would lay upon a company which produced only ironstone a duty for the efficient and economical supply of all the three or four activities listed in the first column of the Second Schedule; but he went on to point out that the quantities, types, sizes and prices have to be those as seem to the Corporation best calculated to further the public interest. Of course, if a company supply nothing but ironstone the Corporation would not be likely to deem it in the public interest that that company should supply finished steel in certain quantities, of certain sizes, and at certain prices. Therefore, the hon. and learned Gentleman's second argument completely abolished his first argument.

The hon. and learned Gentleman does not seem to have noticed that this new Clause of the Minister's was put upon the Order Paper very late in the day, after there had been another new Clause in very similar terms on the Order Paper for something like a month. That new Clause which was on the Order Paper for so long, in providing that there should be no undue preference or discrimination exercised by the Corporation, went on to say in a proviso that these provisions against undue preference should not be enforceable in any court of law. It was a most surprising new Clause to put down, because the whole object of provisions about undue preference is so that they shall be enforceable in a court of law.

4.15 p.m.

I ask the right hon. Gentleman: if somebody suffers from unfair discrimination, or if somebody is granted undue preference by one of these 106 companies in the Schedule, does he believe or think that under his new Clause as it is now drawn any effective legal action could be taken in the courts against the Corporation? I do not myself believe, where there is a complaint, as to either supply or price, and where the person who has supplied is one of the 106 companies listed in the Third Schedule, that any right of action could possibly exist against the Corporation under this new Clause, because it will not be the Corporation which has been responsible for either fixing the price or giving the supply.

I believe that this new Clause has been drawn in this way, amongst other things, so as to give a pretence of protection against undue preference or unfair discrimination, and to avoid any possibility of there being a right of recourse to the courts by any injured party against the Corporation. One of the objects of our Amendment is to lay a duty in this matter upon the companies named in the Third Schedule, so that consumers may achieve some real protection by being able to take proceedings in the courts against those companies if they suffer at the hands of those companies. As we are quite dissatisfied, not only with the arguments of the hon. and learned Member for Kettering but also with those of his right hon. Friend the Minister, we propose to divide the House on this Amendment.