Off Balance
Page 61
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WHEN the political parties are at daggers drawn on the subject of transport, and when practically everybody else is anxious that they should reach agreement; there is a good deal to be said in favour of friendly discussions on comparatively minor points that are not concerned with party dogma and that need not arouse political passions. One such item, dating back to the Transport Act, 1947, has recently come into the news again. If in due course it should call for Parliamentary consideration, it should not be too much to hope for an attempt to reach agreement without recrimination.
If certain legal advice given to the Road Haulage Assnciation is correct, another absurdity emers into tne tangled story of the balancing charges levied by the income tax authorities on the compensation paid to the former owners of acquired undertakings. In the recent High Court decision in the case of Bramfords Road Transport, Ltd., it was held that compulsory acquisition did not constitute what is meant by a sale in the relevant section of the Income Tax Act, 1945. According to expert advice, this ruling will enable hauliers whose businesses were partially acquired to escaPe . balancing charges. As the undertakings that went over voluntarily . have also escaped, it follows that only the compulsorily acquired will have to pay.
Appeals to Courts and Chancellor
No wonder plans are ,b,eing made to take the appeal as far as possible, ,and siMpltineously to present the case to the Government as one calling for a revision of the law in the interests of equity.
As some people See it, the tragedy of the 1947 Act lay in the complete' loss by many hundreds of Operators of the businesses that many of them had spent a lifetime in building up. Other operators who went over without a struggle were entitled to make that decision at the expense of forfeiting sympathy. Naturally, the Conservatives could not be expected to give advice on whether to. sell at once or wait for the inevitable, but those hauliers who did wait were of. the opinion that by so doing they strengthened the cause of free enterprise. It is unfortunate that under a Conservative Government they should be called upon to pay what amounts to a penalty for supporting Conservative principles.
However, it would be a mistake to pursue 'the matter further along these lines. Now that the unravelling Act is on the Statute Book, any action by the Government in favour of one section of the transport industry will be the target for accusations and reproaches, and there is more ingenuity than tact in the argument, which has been advanced, that the Government are frustrating their own policy by levying balancing charges on former hauliers who need the money to buy their way back.
The Opposition, both inside and outside Parliament, have already collected a strangely assorted armoury for their first skirmishes against denationalization. They attacked the relaxation of, hire-purchase restrictions. One or two of the more enthusiastic amonithefri jumped the gun by blaming the sale of the transport units for the increase in road accidents. Even more recently it has been alleged that the threatened deprivation of British Road Services profits prevented the British Trans
port Commission from giving the railway workers a wages increase of more than 4s. a week. If it can thus be argued that the purpose of nationalizing road haulage was to give more money to the railwaymen, one may be certain that the Opposition will make all they can out of any move to put right the balancing charges anomaly, unless it can be shown beyond doubt that an injustice has been done.
In fact, the Government have been careful not to provide any real excuse for the suggestion that they are giving the hauliers an unfair advantage. Nothing in the Transport Act favours either past or present operators who may wish to buy transport units. The Government are unlikely to remit balancing charges so as to make it easier for ex-hauliers to tender, especially as there is no guarantee that the extra money would make the recipients any more willing to buy. "
Should the legal battle go against the ex-operators, the only remaining possibility of redress, would be in the political field. When the attempt is made, party politics should:be avoided. It is better to seek common ground, to present a case that would be as likely to appeal to a Socialist as to a Conservative Chancellor Of the Exchequer.
Orte .guiding principle in the nationalization programme carried out by the Socialist Government was that compensation should be fair, or at ony rate ,equitable. Various methods and formulx were devised according to the circumstances, but it is to -be presumed that they were intended to give more or less the sarhe result. Voluntary acquisition could be accomplished by the sale of shares, and it was asserted on several occasions that the price paid was estimated to be the same as the operator would have received under the arrangements for compulsory acquisition.
All or Nothing At All
In whatever calculations were made, it is unlikely that there was any allowance for balancing charges. From any sensible point of view it would be assumed that the tax payments would be due either from all the undertakings or from none. If this had not been the case, the threat of balancing charges would have been an almost irresistible lever in persuading operators to offer their businesses. The irrelevant problem of taxation would also have disturbed the man refused an original permit and trying to decide whether to ask for the acquisition of the whole or only a part of his business.
The question of balancing charges was overlooked when the 1947 Act was drafted and under discussion in Parliament. It is scarcely worth suggesting that a more leisurely debate and less frequent use of the guillotine might have brought the point out. No law is perfect. There were other flaws in the Act, such as the wording that debarred a widow from the right to her late husband's original permit. In these and similar circumstances the Labour Government were quick and generous in acknowledging their error and in taking steps to put it right. Now they are in opposition they should be no less generous in admitting that they had no intention of empowering the income tax authorities to divide acquired undertakings arbitrarily into sheep and goats. Once this stage has been reached, there should be no difficulty in devising some method of putting the matter right.