Labour Fights Merger

Sun (Auckland), Volume II, Issue 518, 22 November 1928, Page 9

Labour Fights Merger

“FINANCE GANG” AND CABLES

An Amendment Defeated

(United PA. — By Telegraph — Copyright) British Official Wireless (United Service) Received Noon. LONDON, Wednesday. LABOUR members of the House of Commons are bitterly fighting the proposal to sell the Empire’s cables to the proposed merger company.

Mr. A. M. Samuel, Financial Secretary to the Treasury, moved in the House of Commons the second reading of the Imperial Telegraphs Bill. He said the measure was necessary for giving effect to the recommendations of the Imperial Wireless and Cable Conference. It authorised the sale to the Communications Company (which was to be formed) of the Pacific cable and for West Indian cable, and the two transatlantic cables, which were now in the possession of the Post-master-General. It also provided for the dissolution of the Pacific Cable Board when the transfer of the undertaking for which it was responsible had been completed. The Bill did not deal with the beam service. The three cable services had been very seriously affected by wireless and beam competition. The Pacific cable was owned by his Majesty’s Government and the Governments of Canada, Australia and New Zealand. The cable was to be sold on a basis that the Communications Company took over the loan capital debt, and paid in addition a capital sum of £517,000, which was divisible between the partner Governments. The West Indian cable was owned by Great Britain, Canada, and some of the West Indian Islands. That cable would be sold for £300,000. The remaining property—lmperial Cables —consisted of two cables across the Atlantic, operated by the Post Office, one being an ex-German KING TO DECORATE MR. BERT HINKLER

cable. They would be sold for £450,000. If the three properties were taken together, tie partner Governments were relieved of a debt of £1,233,000 on the loan debt, and besides received £1,267.000. Apart from that, they were receiving an annual payment of rent in respect of the beam of £250.000 in cash, and £60.000 in cash besides. LABOUR LEADER’S ATTACK Mr. Ramsay MacDonald, the Labour leader, moved: 'That this House declines to assent to the second reading of a Bill which sacrifices a public utility to private gain, by disposing of valuable State undertakings to private interests.” Mr. G. D. Hardie (Labour): Who initiated the sale? Mr. Samuel: Canada. In the Bill we followed the trend of modern industrial and scientific discovery. Here there were ironic Labour cheers. Mr. Samuel, continuing, said the conference was of the opinion that it was impossible to continue with the cables in several different hands, as it was wasteful and uneconomic. The new plan would prevent, overlapping and secure to the consumers those economies. The safeguards included the Empire Advisory Committee. Mr. MacDonald said the Bill’s introduction in a dying Parliament was a violation of constitutional practice. He I said the Government was apparently asking the House to sell the Communieatkiis Company a pup, but this was not a question of selling bankrupt cables. It was a question of high national and Imperial policy, touching the efficiency of Imperial communications and the ownership and control of essential services. The conference was a mere gobetween between the merger interests and the Governments. The latter had actually been “sold a pup,” and had thrown away the key of the situation. NOT PUBLIC UTILITY The merger company, Mr. MacDonald declared, was in no sense a public utility. “Did anyone ever hear of such a reason for handing over 50 per cent, above the standard income? The whole thing is absurd. The appointment of two directors to safeguard the public interest is a mere fraud and an imposition. The Advisory Committee has neither status, power, nor position.” Mr. MacDonald asked would the contract be laid on the table before its signature, so that the House could see whether the safeguarding was carried out? It should be examined by a Select Committee. Mr. Walter Baker said Labour’s case was that an international gang of financiers had been working to force Britain and the Dominions to this policy. FURTHER DEBATE Mr. G. Pilcher (Conservative) said the country had lost £15,000.000 on telegraphs and telephones in the last ten years, therefore he was glad that cables and wireless were passing from the Government. Mr. P. B. Malone (Conservative): Was the rumour that Lord Birkenhead would be chairman of the new company true? Mr. G. M. Gillett (Labour) said it was as absurd to hand over the cables and wireless as it would be to hand over the navy to private enterprise. Sir John Gilmour, Secretary of State for Scotland, replying, said that the members entered the conference without any preconceived notions. It was in no way a prejudged problem. He emphasised that while they were selling the cables, which were a losing proposition, they were only leasing the beam wireless. The whole thing would be worked in the most economical manner. The Advisory Committee, which would represent all the Governments concerned, would have a complete veto of all increases in rates if 1 they disapproved. Sir John said there would be British control and adequate safeguards of the public’s interest. The scheme would bring about more rapid communications all over the Empire. Replying to Mr. Macdonald, he said he would have to consult the Dominions before he could say whether the contract would be tabled. The amendment was rejected by 258 votes to 134, and the Bill read a second time.