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that the rest of the disposal operation would continue undisturbed. If at the last minute we were to abandon any present attempt to sell the Parcels Company we would in my judgment be placing a considerable strain upon their loyalty. In addition, as indicated, the last minute cancellation must inevitably become known and might well be thought to be in the nature of a panic decision.
5. I do not rate very highly, though I cannot wholly exclude, the possibility of an offer being made for the Parcels Company by persons who did so with the intention of buying it for break-up purposes. In addition to vehicles, the Parcels Company does contain a substantial amount of property of a specialised kind. It is true that if the Company could be cheaply purchased it might have certain attractions from this point of view. But the adequacy of any offer which is made has either to be approved by both the Disposals Board and the Commission or, in the event of their disagreement, referred to me.
6.
The other issue which the Home Affairs Committee asked me to submit to the Cabinet is the question of the future of the levy. In H. P. (55) 65 I recommended that the forthcoming Bill should provide that the levy should continue till the end of 1956 at the present rate and then terminate. In this event the total yield would be likely to amount to about £12 millions.
7. On the assumptions that the Commission retain the additional vehicles proposed by the Bill but that their remaining assets including the Parcels Company and the meat vehicles are disposed of, I calculate that on the basis of the 1953 Act the amount which the Commission should receive would be approximately £12 millions,
8. Some of my colleagues in the Home Affairs Committee were, however, disturbed by the information that the Commission feel that they ought to receive a larger sum and I was invited to include in my paper for the Cabinet a statement setting out the issues involved,
9.
These are exceedingly complex. Three of them, a dispute on the grounds of the excess of the real value of assets over their written down book value to the extent of £5 millions; a claim based on a refusal to accept the Commission's revision of depreciation rates to the extent of
£1.5 millions; and a claim for abortive expenses incurred in acquiring road haulage undertakings of £1.3 millions, derive directly from the provisions of the 1953 Act. I am inclined to think that there is some force on their merits in the Commission's claims in this respect. But I do not think that it is appropriate in the present Bill to embark on a complete overhaul of the 1953 Act provisions. These points were, I understand, fully considered at that time.
10. The remaining cause of complaint by the Commission was not contemplated at the time of the 1953 Act. That is the decision of the Inland Revenue that a balancing charge on the excess over book values of sums actually realised from sale of physical assets would be imposed. Assuming the continuance of present rates of tax this liability might amount to some £4 millions. But as actual payment will not be required to be made until the Commission's accumulated loss on revenue has been turned into a
surplus, this is a somewhat remote liability. Indeed its present value can be conservatively calculated at some £2 millions. Page 18 of 321
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