CABLES-WIRELESS MERGER

New Zealand Herald, Volume LXV, Issue 20111, 23 November 1928, Page 13

CABLES-WIRELESS MERGER

DEBATE IN COMMONS.

SALE OF BRITISH SERVICES.

BILL PASSES SECOND READING

British Wireless. RUGBY, Nov. 21. The Imperial Telegraphs Bill, which provides for tho transfer of tho Government's eablo and _ beam wireless services to the new Imperial Communications Company was debated on the motion for the second reading in the House of Commons this evening. Mr A. M. Samuel, financial secretary to the Treasury, moved the motion. He said tho measure was necessary to give effect to tho recommendations of the wire-less-cables conference. -The Communications Company was to take over tho Pacific and West Indian cables and the two transatlantic cables now in possession of the British Post Office Department. The bill also provided for the dissolution of the Pacific Cable Board when the transfer of its undertaking had been completed. The .mcasuro did not deal with the beam service. Sums to be Paid to Governments. Tiie Government's three cable services had been very seriously affected by wireless competition. Tho Pacific cable, which at present was owned by the Governments of Britain. Canada, Australia and New Zealand", was to be sold on tho basis that tho Communications Company should take over tho board's loan capital debt turtl in addition pay a capital sdn of £517,000 to be divisible between the partner Governments. The West Indian cable, owned by Britain, Canada and some of the West Indian Islands, would be sold for £300,000. The remaining property of Imperial Cables consisted of two lines across the Atlantic, operated by the Post Office, one being a former German cable. They would be sold for £450,000. Taking the three properties together the partner Governments would be relieved of a debt of £1,233,000 on their loan accounts and besides ' would receive £1,267,000. Apart from tiiat they would receive an annual payment in rent in respect of the beam service of £250,000 and also £60,000 in cash. Labour Amendment Moved. Mr. G. .D. B. Ilardie, Labour member for Springburn, Glasgow, asked who had initiated tho sale ? Mr Samuel: Canada. In the bill we have followed the trend of modern industrial and scientific discovery. (Ironic Labour cheers.)

Mr. Samuel said tho Cables-Wireless Conference had expressed the opinion that it was impossible to continue the cable services in several different hands as it was wasteful and uneconomic. Tho new plan would prevent overlapping and secure to the consumers economies and safeguards. It included an Empire advisory committee.

Tho Leader of the Labour Party, Mr. Ramsay Mac Donald, moved the following amendment: That the House declines to assent lo tho second reading of the bill, which proposes to sacrifice public utility to private gain by disposing of valuable State undertakings to private interests. The mover said the introduction of the bill in a dying Parliament was a violation of constitutional practice. Apparently the Government was asking the llouso to " sell a pup" to the Communications Company. Key to Situation Throwa Away.

But this was not a question of Selling bankrupt cable concerns, said Mr. MacDonald. It was a question of high national and Imperial policy which touched the efficiency of the Imperial communications and the ownership and control of, essential services^ The Cables-Wireless Conference was a mere go-between for the merger interests, and tho Governments concerned. The latter had actually been " sold a pup" and had thrown away the key to the situation. Tho merger company' was in no sense a public utility. Did anyone ever hear of such a reason for handing over 50 per cent, above the standard incomo ? Tho whole thing was absurd. Tho appointment of two directors to safeguard tho public's interests was a , mere fraud and imposition. 'Die advisory committee would have neither status, power nor position. Mr. Mac Donald asked if tho contract would be laid on} the table beforo it was signed, so that the House could see whether safeguarding would bo carried out. The contract should be examined by a Select Committee. Government's Losses on Services.

Mr. Walter J. Baker, Labour member for Bristol East, saiiT Labour's case was that an international gang, of financiers had been working to Britain and the Dominions to adopt this policy. Mr. Georgo rilcher, Conservative member- for Cornwall, said Britain had lpst, £15,000,000 on her telegraph and telephone services in the last 10 veal's. Therefore ho was glad tho cables and wireless were to pass out of tho hands of tho Government. Major F. B. Malone v Conservative member for Tottenham South, asked if the rumour (11at the Karl of Birkenhead was to bo chairman of tho Communications Company was true. Mr. G. M. Gillett, Labour member for Finsbury, said it was as absurd to hand over tho cables and wireless as it would bo to hand over tho Navy to private enterprise. Defeat oi tho Amendment. Sir John Giltnore, Secretary for Scotland, in replying to the debate, said the members of the Cables-Wireless Conference" had entered upon tho discussions without' any preconceived notions. They had m no way prejudiced tho problem. Although tho Government proposed to sell its cable services, which were « losing proposition, it -would only lease the beam wireless service. Tho latter would bo worked in the most economical manner possible. Tho advisory coniniitteo which would represent all the Governments concerned would havo complete power to veto all increases iu rates if it disapproved of them. There would bo British control rind adequato safeguarding of tho public's interests. Tho scheme would bring about moro rapid communications between all parts of (ho Empire. Ho said ho would havo to consult tho Dominions before ho could say Xvhothcr the contract would be laid on the table. Tho amendment was rejected by 258 votes to 134 and tho bill waß read a second time.