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Commons Chamber

Volume 437: debated on Friday 16 May 1947

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House Of Commons

Friday, 16th May, 1947

The House met at Eleven o'Clock.

Prayers

[Mr. SPEAKER in the Chair]

Private Business

Helston And Porthleven Water Bill

Read the Third time, and passed.

India (Situation)

Might I ask the acting Leader of the House a question on Business? We see in the papers this morning that the Viceroy has returned for consultation, and I feel sure the right hon. Gentleman will agree that it is desirable that the House be kept informed as far as possible of any developments in the Indian situation as they arise. While I do not press for anything today, I should be glad if he will represent to his right bon. Friend the Leader of the House that we shall be glad if a statement can be made at the earliest convenient opportunity.

I can give the right hon. Gentleman an assurance that as soon as a statement can be made, it will be made, and I will communicate the purport of his question to my right hon. Friend the Leader of the House.

African Groundnuts Scheme (Appointment Of Public Corporation)

The House will wish to be informed of the steps which are being taken to ensure continuity of direction of the project for the large scale mechanised production of groundnuts and other agricultural produce in Africa. Clearance of the bush and other work on the project has already begun. As originally arranged the managing agents who are at present in charge wish to terminate their agency not later than August, 1948. Legislation necessary to set up a public corporation which will then take over will, as already announced, be introduced in due course. Meanwhile it has been desirable to proceed with the selection of the members of this corporation so that it will be in a position to assume its large responsibilities in due time.

The following gentlemen have now agreed to serve as the members of the corporation when the necessary Parliamentary authority has been obtained:

Chairman: Mr. L. A. Plummer, assistant general manager and a member of the board of directors of Express Newspapers, Ltd. Formerly business manager of the New Leader, the Miner and the Socialist Review, and assistant manager of the Daily Herald.

Vice-Chairman: Mr. James McFadyen, director of the Co-operative Wholesale Society, Ltd., and a member of the Colonial Economic and Development Council.

General Manager in Africa: Major-General Desmond Harrison, member of the Institution of Civil Engineers, Director of Works at the War Office, and formerly Engineer-in-Chief to South East Asia Command.

Members of the Corporation: Sir Charles Lockhart, economic adviser to the East African Governors' Conference; formerly Chairman of the East African Production and Supply Council and Chief Secretary to the East African Governors' Conference;

Mr. J. Rosa, member of the banking firm of Helbert, Wagg & Co., Ltd.; during the war Treasury representative in Syria and the Lebanon, and later a member of the Economic Division of the Colonial Office. One of the signatories of the original report recommending the groundnuts project;

Mr. A. J. Wakefield, formerly director of Agriculture in Tanganyika Territory and Inspector General of Agriculture in the West Indies. One of the signatories of the original report recommending the project.

The above will be full-time members and executives. In addition, the following two gentlemen have accepted invitations to serve as non-executive members:

Mr. Frank Samuel, who first suggested the project, managing director of the United Africa Company;

Lord Rothschild, biologist. Formerly fellow of Trinity College, Cambridge.

I would very much like to congratulate the Minister on his choice of Mr. Plummer as chairman of this new corporation. As the Minister has shown by reading his "crime sheet," Mr. Plummer has passed from the obscurities of Socialism to the high Imperialism of Lord Beaverbrook's organisation. I know he is undertaking this task with a very high spirit of service and sacrifice. He is a man of good mind, good character and great organising ability, and I congratulate him.

In this set-up, which the Minister has read out, it is quite clear that the whole-time serving members are those who have the greatest qualifications on the production side. Of the two advisory members, at least one has experience on the marketing side. Will he say whether during the period of production the deepest study will be made of the marketing side, so as not to cause undue upset to those producers of groundnuts throughout the world who do not come under this scheme, so that there is no bad effect of wrong competition from a Government-controlled groundnuts scheme with the vast majority outside?

I am grateful to the hon. Member for giving me the opportunity of saying that I do not think producers of groundnuts elsewhere in the Empire, or elsewhere in the world for that matter, need have the least apprehension about that-situation. The truth is that the almost cessation of exports from India has left such an enormous margin to fill, that this scheme, vast as it is, will be inadequate, rather than adequate, to fulfil the world's needs for groundnuts. The other producers, whose interests we have, of course, very much at heart in our interest, need have no fear whatever on that score.

What are the plans with regard to the technical and other staffs? Is my right hon. Friend aware that in India and Burma a large number of Europeans are now considering their future prospects? They are much interested in this scheme, and would welcome some information from the Minister as to whether they are likely to be employed.

The corporation will, of course, recruit its own staff. We would not wish to bind its hands in any way. In the meanwhile, the managing agents, who are actually at work on the project now, have recruited staff, and a good deal of that recruitment, which I am sure has been very well done, will no doubt be taken over by the corporation, but no doubt men with experience in tropical areas have an advantage over others and will certainly be eligible for recruitment.

Has a decision yet been made as to where the offices or headquarters of the corporation may be located?

No, Sir. Not, I think, in Africa. The actual headquarters will be in this country, because these activities are not necessarily confined to the present estates or the present territories. I do not think any headquarters are suggested in Africa.

Is there likely to be sufficient native labour available to handle this vast project? Has that been carefully considered?

Yes, Sir. That has naturally been one of the greatest concerns in the whole launching of the scheme. If my hon. Friend will read the White Paper, he will see that it has been taken fully into consideration. That is why the scheme is based on a high degree of mechanisation—because we realise that only by a very economical use of labour will there be sufficient. If that is done, and it will be done, we are assured that the labour will be forthcoming.

Adjournment Debates (Counts)

May I ask for your guidance, Mr. Speaker, with regard to the incident which took place during the half-hour Adjournment last night, when a Count was successfully called? The hon. Member who called that Count was fully within his Parliamentary rights, but that half-hour is all that remains to Private Members for opportunity to raise any subject in this House. If that opportunity is to be curtailed, not only by the Government but by other Private Members, something like civil war in this House may result. Is it not the case that a gentleman's agreement exists that this kind of action should not be taken? If that is not so, would it not be in the general interest that such an agreement should be tacitly concluded?

Before you give your Ruling, Sir, I should like to associate myself very sincerely and deeply with what the hon. Member for Cambridge University (Mr. Harris) has said. The half-hour Adjournment is, as he says, one of the very few opportunities left to hon. Members, and I hope that you might indicate what you feel to be the general view of the House. You might, perhaps, consider a distinction between the Adjournment Motion and the moving of Prayers by hon. Members. In the latter case it would obviously be up to the hon. Member who put down the Prayer to maintain his own House. Having drawn that slight distinction, I hope that you will indicate what you feel should be done.

As the hon. Member who was responsible for the incident last night, may I remind the House that the hon. Member for Sutton Coldfield (Sir J. Mellor), who attempted to raise the matter on the Adjournment, used something like threatening language during the course of the Business discussion on Thursday afternoon? If he made what was tantamount to a threat on that occasion, he must not be surprised at what happened last night.

Perhaps I might say one word from this side of the House. I think that the Government will admit—I am not dealing with last night's incident in particular but with the point in general— that pretty drastic demands have been made on Private Members' time in this Parliament, unprecedented in time of peace. I hope, therefore, that we can nave some arrangement whereby this half-hour, which is all the ordinary Private Member has, is a "live" half-hour for him, and is not to be subject to these sudden inroads which are not justified in the circumstances of Parliament as they are now.

We realise the point that has been raised about Private Members' time. I think it is quite true that the House generally has regarded this half-hour as being their particular right as Private Members' time. Of course, it is not possible for us to prevent anyone getting up at any time to call a Count—that is part of Parliamentary procedure—but we hope that the House generally will regard this half-hour as being Private Members' time and that it ought to be given. I think, therefore, that whatever may have been the cause of last night's incident, the experience will probably show that the House as a whole regard it as being their right.

I much appreciate what has been said by the Government Chief Whip. Might I reply to what was said by the hon. Member for Central Hackney (Mr. H. Hynd), who accused me of using some threat which he said justified the action which he took? I would remind you, Sir, of what happened on Thursday on the discussion on Business. My hon. and gallant Friend the Member for Holderness (Lieut. -Commander Braithwaite) pointed out, I think with some justification, that owing to the great mass of Government business, the Adjournment was often being put so late that the purpose of hon. Members in raising matters on the Adjournment was defeated. I took the opportunity of saying, as I had the Adjournment for last night, that I intended to pursue the matter, however late the hour. I did not regard that in any sense as a threat. It was in order to give information to you, Sir, and all hon. Members of this House of that fact that I would continue. I thought it might be useful that that should be known.

I would, like to see this point cleared up. If it goes out to the general public that the House is counted out when a matter is raised by a Private Member, I think it creates a wrong impression that there is no one in the House concerned about the matter except that particular Member. The fact is that the Members of this House have been so overworked that it is impossible to pay strict attention to everything that comes up in the House. The real cause of the trouble is the fact that the Adjournment comes on so late that Members are simply worn out and have to go away. Even on that count alone many Members would be justified in calling a Count, not out of disrespect to the hon. Member who has raised the matter, but for the sake of getting home and getting a sleep.

It seems to me that there is no need, in view of what the Chief Patronage Secretary has said, for me to give a Ruling. Indeed, I do not think I can give a Ruling. It is laid down in our Rules, which I cannot alter without the assent of the House. After what the Chief Patronage Secretary has said, I think that the matter can safely be left there.

Foreign Affairs

Motion made, and Question proposed, "That this House do now adjourn."— [ Mr. William Whiteley.]

11. 20 a.m.

When I was interrupted last night I had just mentioned one or two points about Germany over which our policy might come into conflict with that of the United States of America. I did this as one who is perfectly happy to find us, as a country, in the present circumstances on the United States side of the line dividing America from Russia. It seems to me that the fact that we are on the American side of the line is the result of a perfectly proper and independent policy pursued by this country. It has always struck me that the idea that we have to maintain an exact middle position between America and Russia is a completely stupid basis for a policy. It is, indeed, a denial of a policy altogether. None the less, there are bound to be some conflicts of ideas between us and America in setting up the fused zone in Germany.

I would like to mention one further conflict, or possible conflict, which may arise over the type of economic organisation that we ought to set up in the fused zone. I was very glad indeed to hear what the right hon. Gentleman the Secretary of State for Foreign Affairs had to say yesterday about the Ruhr. I think, in the first place, that it is extremely important that there shall not be four-Power control of the Ruhr alone in Germany and not of other parts of Germany. Secondly, I was glad to hear the right hon. Gentleman say that the principle of public ownership is being maintained. The Ruhr, though far the most important industrial unit in the fused zone, is not the only one, and this problem of whether to have public ownership and centralised control or decentralised private control will arise in a number of cases in the fused zone. It seems to me extremely important that there should be enough of a planned economy in our zone. We have a direct national interest in that. It pays us as a country to save costs in Germany and costs mean dollars.

In so far as the controlling and planning of the economy in Germany are going to be efficient and save money, we have an absolute duty, a natural duty, to press for it. Hon. Gentlemen opposite, just as much as we on this side of the House, have that duty, because this is not a question of domestic politics, but of saving our balance of payments. We must put right at the top the efficiency of the German economy. In the Debate yesterday my hon. Friend the Member for West Coventry (Mr. Edelman) said that had the Ruhr been nationalised, it would have helped Hitler because it would have been more efficient. So far as my hon. Friend means that nationalised industry is more efficient than un-nationalised industry, he is quite right; an efficient tool can, of course, be used for wicked purposes as well as for good. But I would point out that if the Ruhr had been nationalised there would not have been in existence the Ruhr magnates who did much to bring Hitler to power. That should be remembered in our approach to the problem of the economic organisation of Germany

I think it is good that there has been so much attention paid to Germany in this Debate. One of the good things about the Moscow Conference is that it has concentrated public attention again on Europe, which seems to me to be the centre of world problems today. I do not think that it is nearly well enough realised how far the eclipse of Europe complicates our problems and how great a change will be made in the world when Europe rights herself. It is a temporary eclipse. It seems to me that a lot of our present problems result from this eclipse of Europe, in particular, the polarisation of power in the world between Russia and America. What has happened is that half the world, in terms of population and wealth, has been knocked out and is still getting to its feet. As a consequence, that has left a monopoly of productive power in America and the Western hemisphere, and a monopoly of land-power, of actual army-power, in Russia. A sort of vacuum has been created by the eclipse of Europe.

I think that the revival of Europe, which is still potentially one of the great areas of the world, in terms of population and wealth and industrial capacity, will make a complete difference and change to the world situation. It will tend to reduce the relative power of Russia and America. It will get us away from this idea—and this fact—that Russia and America dominate the world. It seems to me that it is a prime national interest for us to work for the revival of Western Europe, not in the old-fashioned way in which the right hon. Gentleman the Member for Woodford (Mr. Churchill) wants to do it by means of a sort of recrudescence of the Grand Alliance of the Duke of Marlborough. I think this revival ought to be done in the way it is being done by the Government and the Secretary of State—by economic revival, a steady proper economic integration and by ad hoc international organisation—into which the Secretary of State has put a great deal of energy and efficiency.

I was very glad to notice a sober note of confidence in the statement made by my right hon. Friend yesterday. I think he is right and I think the reason for that is that, in a certain sense, time is on our side in this matter. A number of hon. Gentlemen on both sides of the House said yesterday that it was not, but it seems to me that time is on our side in one very important respect, namely, that as Europe revives, it will restore the economic and political balance of the world, and the world will be a much better place to work in. I think that the policy of the Secretary of State, which I defend and think is right, could be described as being the reverse of Canning's old policy. I am sure that it is the right policy for the Government today to call in the Old World to redress the balance of the New.

11.26 a.m.

In the closing phrases of the speech of the hon. Member for Smethwick (Mr. Gordon-Walker) there seemed to me to emerge one rather curious split idea. To discuss Europe as if this country was not part of it seems rather to miss the whole point. I would like to turn to a rather different area. This is a foreign affairs Debate. I have in mind a number of occasions when the Government appear to follow some secret policy. Yesterday, the Foreign Secretary gave what was really a very able, brilliant and penetrating piece of rapportage on the conference which he has just attended in Moscow. That has provided the pattern for this Debate. The Minister comes back, now from the East and now from the West, and makes a report on the highly important Conference which he has attended. That produces as a byproduct a certain semi-secret diplomacy about the areas which are not actually discussed at the Conference.

I welcome the opportunity for turning to an area which, though it was not considered at the Moscow Conference, affected the Conference and was, in turn, affected by it. I refer to the Far East. I believe that during the Conference China did appear one day very prominently on the agenda and, though it appeared there for a tactical reason that has not got much to do with China, at must have come in for some considerable discussion. The Foreign Secretary will have had the advantage of discussing Far Eastern matters with General Marshall, whose sojourn in China should have been of infinitely greater benefit to the Far East and to China, and which, I think, ended disastrously for China. Anybody who read the valedictory message of General Marshall to China and considered the weight of it, the knowledge, and the accusations which it contained, will have realised how sick and sorry an area China is, what great danger it contains to the whole of the Far East, and how much it missed by its attitude to America. There is no doubt that, although it is probably of paramount importance at the moment to concentrate on the West, nevertheless in the minds of Russia and the United States, the Far East is a vitally important area and the same general manoeuvring is taking place there.

It has been said, I think with justice, that the Orient begins East of Vienna. In many ways, the Russian mind is an Oriental, or semi-Oriental, mind. Oriental questions have to be considered, therefore, from the angle not only of ourselves and of the countries there, but of the prominence in strategic economy that they must have in the minds of Russia and of the United States. I think that there is a justifiable cause of complaint for hon. Members of this House who are interested in the Far East, in that we never get sufficient information. At the end of his speech, the right hon. Gentleman the Member for Warwick and Leamington (Mr. Eden) asked a certain number of very pertinent questions. At the end of the speech of the Minister who is to reply, we may get a few sentences in reply to those questions and to other inquiries that will be put forward. That is not nearly sufficient in view of the enormous importance of that area and of the effect that it is undoubtedly going to have on the industry, economy, and daily life of everybody in this country. I hope today the Foreign Secretary's replies will be fuller and more satisfying.

I make no excuse, therefore, for devoting a little time to questions on the area. China itself has gone backwards, both economically and politically, during the last year to a degree that is hardly realised here. I myself made a quick trip over Christmas and the New Year to China, Hong Kong and Indonesia, and I was horrified to see the virtual breakup of China that has taken place. It is not only the division between the so-called Communists, the Yunan area and the Kuomintang, it is the breakup that is taking place within those areas. It is a sorry pattern. There is no positive authority by any government. The departure from the principles of Sun Yat Sen, who wished to help the common man in China, has been so great that his lot today is getting worse the whole time.

It was mentioned yesterday that extraterritorial rights were given up in 1943 by the United States, France and ourselves. That was an admirable gesture, and it was done with the best intentions, but the result has been rather the opposite of what was really intended. It has in no way improved the lot of the Chinese, for two main reasons. What are the real bases of ordered civilisation? They are these: the administration of law in an open way in which it is not influenced in favour of the rich or anybody else; open law, openly administered, and being visible public law for everybody. That does not exist in China, though it did in the Treaty ports, and that is one of the reasons why over a million Chinese have gone from China to Hong Kong.

The other thing that is absolutely vital is, to put it in the simplest terms, a stable currency. It means that a man's earnings on Monday have the same purchasing power on Tuesday. That does not exist in China either. The value of the Chinese dollar today compared with the Hong Kong dollar is about 6,000, which is an astronomical figure compared to a 1935 parity of the two currencies. It means that the rickshaw coolie, when he has earned a wage at the end of his day, has either to put it into a tin of cigarettes, which he sells the next morning to replace his capital, or that his Monday earnings will not buy his Tuesday food. When that prevails throughout a country you get a serious bogging down of the whole of the economy. It is no use thinking that because there were certain changes under pressure, in the form of the Nanking Government, certain Ministers whose inefficiency or corruption has gone beyond the very wide limits that are permitted in China, have been removed and others put in their place, that is any cure at all. Civil war and war-lordism still prevail. The economic situation has got so bad that there is only a trickle of exports coming out of China and, in return, China can only afford a very small amount of imports. The result is that the whole of that huge market is gradually being sealed against us and the rest of the world.

It is difficult to see what major contribution we can make. Certainly the first thing we can do is to press for a great deal more information on incidents such as that which occurred in Formosa—which was a very ugly incident in every way, where many thousands of lives were lost or jeopardised by maladministration. It shows how dangerous it is to assume that, because there is an appearance of democratic government under a set of democratic rules, it is a reality and that, under those circumstances, people who have not been trained in democratic rules can administer territories which have recently been handed over to them. We have a duty to those who were under our protection before, whom we may be handing over to the rule of those who will not administer and look after their affairs with the same open-handed justice and efficiency that we did. We cannot afford to have a policy in China for ever of sitting on the side lines; we have to do something a little more active. Probably the best way we can do it is by giving every encouragement to and the backing of the trading and commercial communities of all countries concerned. On this we must work hand-in-hand with America and other countries to continue business in China, and to try to do business there in spite of the difficulties. There are great difficulties, and the commercial communities of all these countries are discouraged. We want every sort of encouragement from H.M. Government in this matter. We want the appointment of more and younger, and probably more up-to-date, commercial councillors and consuls; we want consular officials who have possibly the new aspect regarding the commercial community partnership between us and China. It is worth pointing out that in the Chinese hierarchy the merchant holds a much higher position than the politician and that may be worth remembering. [An HON. MEMBER: "That accounts for the speeches."] There is no doubt that the American view of China, and their withdrawal from China, was based on the discouragement they received when, for a long time, they had been most open-handed in proffering real help in every possible way. General Marshall's farewell message brought that out very clearly.

There is one thing we can do for China at the moment which is both fairly easy and clear-cut. It is easy for the Government, because it does not call for any immediate action, but it is far-reaching in its effects. It is to make quite certain that the status of Hong Kong and the leased territories remains quite openly and clearly where it is now, with no foreshadowing of change for a long time to come. Hong Kong at the moment is about the only lung through which China can breathe, and it is extremely important that there should be no idea that that can be changed. The very fact that over a million Chinese have flocked to Hong Kong and have caused embarrassment to the Government—which they are handling with skill—is nevertheless some earnest of what the Chinese people themselves think of the comparative value of a negative government with no power of control, which cannot keep its own currency in bounds, and the administration and the methods which have been adopted in Hong Kong. I am sure the House will join with me in wishing the new Governor, when he arrives, every success in his very difficult task.

The fact of the dèbacle in China has undoubtedly driven America into the new sphere on which she is now concentrated, namely, into Japan. I think we must admit quite frankly that America's two aims in the Far East are slightly divergent. The one of paramount interest is undoubtedly the strategic. It is of help to us and to Australia, and to anybody who is geographically anchored to the Far East and East Asia. The United States have been looking for some bastion, for some hard spot to which they can anchor themselves in case there should arise again a situation in which a second Pearl Harbour could occur. It is no harm to us that they are doing so. They are taking on. by so doing, the policing of that area, a task which we carried out well and efficiently for many years but which, we must face up to it now, we can no longer be able to add to the many burdens that we carry already. It is, therefore, not in a spirit of jealousy at all that we should regard America's activities in the Far East and in Japan, but with the idea of persuading America that we can become her partner, as well as partner to Japan, China and Indonesia, to the full. A rubber curtain is being drawn over Japan—nothing so rigid and ungentlemanly as an iron curtain—and if you lift one corner of the rubber curtain it will in a short while snap back and you have only a glimpse of what is behind it.

But, so far as Japan is concerned, it is extremely important that we should have our full share in every way in her development along the lines we foresaw there. We have a traditional right. We were one of the nations which, through the contact that took place between Japan and the West, did more than any other to build up Japan, to help Japan, as we hoped, to become a great and useful nation in the nations of the world. To some extent that took the wrong turning but, as we are now redeveloping Japan, it is vitally important that we should claim with the full force of the public behind us—and the public will be behind His Majesty's Government to a man in this—the right to assume our proper place in the development of Japan. We did our bit in the Far East in the war. It is most important that we should have no illusions about that.

The big danger at the moment is not only the economic. Let me take the political first. Up to two years ago, in the minds of every Japanese, he was ruled by a curious hybrid, half-God and half-man, of such divine power that he could not be looked upon by the ordinary populace, who had to bow down when he passed. Today, as a result of losing the war, and the occupation by America, he sees this divine being as a shrinking and timid little man in a frock coat and a top hat, ill-fitting at that, rather uncertain of himself and without any power at all, shorn of both his power and his glory. What effect must that have on the mind of the average Japanese? It must wrench from their sockets the whole of the ideas which they have inherited for centuries, and it must leave them in a state of mental doubt and uncertainty which it is difficult for us to understand, and which certainly cannot be exaggerated. On top of that, we impose—and I am afraid this is the mistake that is being made—a sort of ready-made Western pattern of democratic machine with all the motions of voting and elections and the creation of parties. If we believe that we will alter in less than two years the habits of mind, the tradition and belief of centuries, we are trusting in something extremely flimsy which will break at the moment when it is least desirable that it should break. I urge on His Majesty's Government that, with our greater experience of the development and running of countries of that sort, we should give advice from the great fund of experience that we have to see that the democratisation of Japan is not a paper one but one of reality. There would be a real danger if we should give up our duty of bearing the burden that we ought to assume because on paper the Japanese appear to have a machine which is similar to our own. If we drive an Eastern machine at Western pace there will be an accident very soon.

The economic side of Japan is, in a way, still more difficult to understand. It was said yesterday that we here should see to it that the wage level of Japan is brought up to a proper standard. I believe that in that use of the word "wage" is a clue to what must be rather an illusion. To raise the standard of living, as I believe the President of the Board of Trade said on one occasion when questions were being asked of him about what was going to happen about textiles in Japan, is rather difficult. The Japanese, from the climatic and geo- graphical situation of their country, have to live in flimsy houses, the construction of which would be a delight to the Minister of Health in view of the statistics which he would be able to produce—houses made with straw, not bricks. If they have two helpings of rice and fish instead of one, it is providing something which they, in a mistaken state of mind, consider as more satisfying and glorious even than the plethoric wonders and variety of a Strachey diet.

But when we have raised the standard of living and have given them the maximum of food and clothing, and the proper amount of leisure, they will still be on a standard of living which must make them enormously dangerous competitors to anybody who is competing with them in any line of business, whether it be textiles, machinery or anything else. We have to face the fact that we shall be shrinking from a task which we should undertake, if, because we are told their standard of living has been raised—that they have formed themselves into unions and have gone through all the correct motions—at the end of that the real fact is that, with American help in technical, financial and other respects, they are then able to produce better goods than ever they did before, and at a much lower price than countries which have a very much higher standard of living, such as America and ourselves, and the rest of Europe in due course. We shall not have faced the real task which lies before us and done our duty to British industry.

Those of us in Lancashire and Yorkshire who are interested in the textile trade have extreme qualms about this. We are definitely worried because we realise that in building up the Lancashire textile industry today, there is always in the offing a vague threat from a country which may become almost the 49th State of America and which may, in due course, flood the world, as it did before the war, but on this occasion with very much better goods, which are to be marketed, prepared and presented better. The President of the Board of Trade has rightly pointed out that the sellers' market is going. Even in India I noticed on my journey a grave disquiet that Japan may be a serious competitor in selling goods in India at a lower price than that for which they can be produced anywhere else. If that is so there, what will it be like in the rest of the world, not only in this country but in markets which, from the point of view of the export trade, are vital? It is essential that we should have a say in the running of Japan, and in the marketing of her products, and we should have more knowledge. The Foreign Secretary is very sympathetic and understanding in this matter, and, in spite of the enormous difficulties with which he has to deal, takes a very proper interest in the Far East, to which I can testify. I urge on him, when he can find the time, to make another effort, first of all to see, if necessary by sending more people there, what really is happening in Japan and then to turn to the only remedy which lies within our power.

In a time when there is a gradual formation of the lines on which Japan is going to work, the only thing which can be done by this Government is to see that the commercial element in this country—the truly enterprising people, those who represent all the industries in this country—have free access to Japan so that they can see what is going on, instead of reading an emasculated report from a consul or an official who has only been allowed to see a few inches beyond the end of his nose. We know that the Foreign Secretary is a great backer of the idea of free and easy travel for people of this country. He has given many signs of that. Such facilities should be extended. It will not be easy, because in the minds of the American occupation forces there is, undoubtedly, a certain mistrust and a desire to look upon it as their own particular area. That mistrust must be broken down for their sakes and for the sakes of Japan and of ourselves. He will have the support of everybody in this country in the vigorous and earnest endeavours which I am certain he will make to withdraw the rubber curtain and thus enable free access into Japan.

I would like to say a few words regarding one other area in the Far East—Indonesia. I myself went there and had the pleasure of meeting Dr. Sjahrir, Dr. Gani and Dr. Van Mook, who is a very old friend of mine. In that area we must be filled with even more apprehension than in China and Japan. There, we see balanced on a fine point the fate of an enormous area. If it goes wrong the effect of the disaster there will quickly run out into areas where we are more directly interested. The Straits of Malacca are small and narrow. The racial and religious similarities between the populations of Indonesia and Malaya are great. I know the Foreign Secretary has taken a great interest in this, and is entitled to look upon, as a feather in his cap, the great contribution by the representatives whom he was instrumental in sending there. It is a sad thought that one of the by-products of the great endeavour we made to get Indonesia away from the Japs is that from quite a large amount of the population, chiefly some of the more reactionary Dutch population, we have received no thanks but exactly the opposite. We have received dislike and distrust. I would like to take this opportunity of reaffirming what an admirable job was done by our occupying forces, and what enormous restraint they showed under the most difficult circumstances. Yet we who held the balance very true and fair between the Indonesian and Dutch interests, are being repaid today not by what gratitude should have, but by something quite different.

What is the real situation? Even after the signing of the Cheribon Agreement, we must admit that the signing of that Agreement has no final effect. It is simply an opportunity to see if the moderate elements in the two parties—the Indonesian and the Dutch—will, by cooperating together, be strong enough to stop the hot-headed follies of the extremists on both sides. There is the Dutch element, most of them still in Holland but drawing their revenues from Indonesia, who naturally do not want to give up what they have acquired. They must face a future of partnership and not of domination; they can still contribute much and reap much benefit on that basis.

On the other side, there is the element up country in Indonesia which causes a great deal of trouble, and which, on the actual say so of Dr. Sjahrir and Mr. Gani, is the chief headache. It must be remembered that in Indonesia only small areas were actually occupied by the Dutch, or over which the Indonesian Government has control. It cannot be left in the hands of a lot of young men, who learned from the Japanese that the possession of shotguns and military caps meant they could live in somebody else's house and take possession of all he had, his women and everything else and live without ever doing a stroke of work. That is a temptation which might tempt young men of many races. It is certainly a temptation to the Indonesians. They must stop it, and replace that sort of life by one in which they have to do the hard work which will be vital for the restoration of Indonesia.

We are accustomed to thinking of Indonesia as an automatically very rich area. It was rich because it was developed, and brilliantly and scientifically developed, for 100 or 150 years. But in the five years since the Japanese arrival it has gone back nearly 100 years. Half the tea has been cut down and used for firewood, and the rest has been allowed to grow and is more or less useless. The rubber survived because rubber is an indestructible weed which nothing can destroy; all the endeavours of man have failed to destroy it, although all other products, needed to raise the standards of life in the world, have gone right back. None of these things will come forward, and it is no use counting on them, until there is political pacification, and that will not be got easily. There are already signs of how difficult it will be, and there are already demands for a bargain for the Dutch to withdraw their troops, and after that to be allowed to reoccupy the areas which belonged to them before—with foreseeable results.

Ownership is of secondary importance. What is important is that they should be reoccupied with the idea of development. But that is not taking place yet, and will not take place for some time. The only remedy, I think—and the Foreign Secretary did ask yesterday for constructive suggestions—is as follows. It is too difficult and dangerous for direct Government intervention in any way whatsoever. We have shown our benevolence, and made it quite clear that we are still willing to do what we can in every possible way. But we have to get rid of the difficulty that exists at the moment because of the smuggling that is taking place out of Indonesia of a great deal of produce against the smuggling in of goods. Neither the produce that is coming out of Indonesia nor the goods we are sending in are being dealt with at world prices. The produce sent out is being bought at under the world market price, and the goods being sent in at over the world market price. That is what gives the smuggler the opportunity to carry out his nefarious business, the black market area in which to work.

Behind it all is the difficulty that the Government which is de jure a Government of Java and Sumatra is de facto controller of very small areas, and nothing more, and cannot, if it wants to, enforce any law it puts out; it cannot even make its currency effective. There is only one solution, and that is for the commercial community, the chambers of commerce, particularly in Malaya and Singapore, to get together and to see that trading on a world basis and at world prices takes place, that reputable steamers with openly advertised sailings go from Singapore or any other places to these ports. There will be much less danger of them being attacked by Indonesian guerrillas. With proper prices paid for goods sent to that country and world prices paid for produce, trade will flow again. The only way to knock out the smuggler is not with a gunboat but by making smuggling unprofitable. I hope His Majesty's Government will see fit to back, in every possible way, the formation of a large and open organisation not exclusive and with open sailings, so that not State trading but open trading under the protection and with the backing of the Government can take place again. The flag and law and order follow trade more than trade follows the flag, and I am certain that if we have a statement today that the Government would look favourably upon some such set-up as that we would stop a good deal of the dangerous and aggravating smuggling which is going on, and, incidentally, assist in getting valuable produce and food out of the area, the lack of which is felt throughout the world.

Finally, on the whole Far Eastern area, let us once and for all fix in our minds that it is a dangerous delusion to believe that we can solve the problem by the export of prefabricated democracy, of utility pattern, whether from America or from this. country, and the easy fitting of it to people not yet educated by the centuries to the democratic way, and who could not today appreciate such a fine flower of democracy as we see in His Majesty's present Government. Nevertheless, a process of getting them to work on different lines must necessarily be a slow one, and step by step. Perfect paper constitutions, magnificent elections, trade unions, and even such democratic manifestations as official and unofficial strikes, should not persuade us that all is well. I believe that if this country gives the lead, in the question of pace more than anything else, in issuing notes of warning that these processes are slow, and must be slow, and that we cannot abandon our responsibilities in these areas simply by sending them a ready-made constitution, then we will be carrying on the admirable tradition we have in the Far East, and will retain the respect in which we have always been held.

11.57 a.m.

I am sure the House is indebted to the hon. Member for Bury (Mr. W. Fletcher) in bringing this subject to our notice in the extremely well informed speech which he has just made. Somewhat to my surprise, I find myself in very considerable agreement with a large part of what he said: but I am also in violent disagreement with considerable sections of his speech, and particularly with some of his trends of thought. One of the most remarkable things about these remarkable times in which we live has been to find that for 22 months in this Parliament there has not been a single Debate on these enormously important issues, which arise over the whole of this Far-Eastern area. It is equally remarkable that a Government of the type that we have now governing this country—a Socialist Government—seems to have been only faintly interested in what we call the awakening of the East. So far as I can see, there seems to have been, in the course of the proceedings in this House, a lack of interest, which I find it difficult to understand, in the real significance of the great movements which are taking place all over that great area.

While it is true that our preoccupation with the problems of Europe might tend in that direction, it may also be quite true that, in the long run, what is happening today in the Far East may be of far greater significance for the future of the human race than anything that is happening in Europe. That is because it may be, when all these movements are worked out to their full consequences, we may actually see the end of the long era of white supremacy in the world, with a complete transformation in the balance of forces throughout the world as we have known it hitherto. One of the great things that is happening in the Far East, about which very little has been said in this House, is that while the struggle for national independence is going on in all these countries there is also a parallel struggle taking place which, for the Socialist, is of even greater significance, namely, the struggle for social freedom which is going on in all these countries parallel with the political struggle—what one might call the clash of the hungry against the well-fed. Surely, so far as we are concerned, with a Socialist Government in this great Imperial Parliament, movements of that kind ought to have been a matter for our direct attention and continuous interest. Therefore, I am extremely glad that this opportunity has at last been provided for us to say something about it.

I think that, probably, it is not tack of interest that has caused the Foreign Office to take the wrong attitude of mind. I think myself that the probable explanation of what has been happening is that the Foreign Office has got into a defeatist attitude of mind with regard to the Far East; and that there has been a tendency, because of the situation that was left as a result of the war, to accept as a fact American dominance of the Pacific in the future, and a belief that we should have necessarily to play a subordinate part. I believe that it is that wrong attitude of mind that is at bottom responsible for what has been happening. I cannot illustrate that better than by directing the attention of the House to a quite remarkable answer I got from the Foreign Office to a Question I put down on 16th April. I asked the Foreign Secretary if he would not consider the appointment to our Embassy in China of an agricultural attaché, following in this the example of the United States of America, who long ago made a similar appointment with extremely valuable results for both China and the United States. I received this answer from the Minister of State:
"In view of the need for economy in trained manpower and in foreign exchange, I do not think that such an appointment could be justified in present circumstances."—[OFFICIAL REPORT, 16th April 1947; Vol. 436, c. 172.]
That seems to me to betray such a lack of sense of proportion as to be completely fantastic. Have we declined so far as a world power that we cannot possibly afford to have an additional attaché at the Embassy at Peking? It is unbelievable. It proves that there is a quite wrong approach to all the problems that face us in these Far Eastern areas.

What can we do? In China, in order to correct this unfortunate position in which we find ourselves, it is true we cannot afford either vast sums of money or great quantities of material goods which, above all things, probably, is what China needs. But, surely, that need not mean we do nothing at all? I think there are certain other ways in which this country could extend its influence in China, quite beneficent and good ways. I believe, with the hon. Member for Bury, that our great trading interests in China must be preserved. The old China trade, the vast commercial and trading interests that we have built up in the Yangtse Valley, are trading and commercial interests that for this country will be of far greater importance in the future than ever they have been in the past, and we cannot possibly lightly let them go in our present economic situation. So I suggest it is our bounden duty that we should try to extend our influence in China, try to cultivate the good will that exists. The old, unhappy memories of 100 years ago have now faded, and there is good will; there is a desire for understanding in China; and we ought to be doing everything in our power to develop and extend it. I suggest that one way in which the Foreign Secretary could give effective aid in the best possible way, aid that we can give without imposing too great burdens on our weakened economy, would be to help the Chinese by giving them some number of technical experts and advisers of whom they are so greatly in need. The Chinese would accept any help we could give them by sending to China a number of agricultural technicians, some of our engineering technicians, teachers for the Christian colleges—teachers of general science in the Christian colleges. They are all crying out for help of this kind. We could, surely, spare, even in our present difficulties, some measure of such assistance. Even though it had to be small, the effect of it in the long run, in the cultivation of goodwill and understanding between our two peoples would be, I think, of quite incalculable value. I suggest that that is one way in which we can give this immediate help for which I am asking.

I want to talk a little while about another point raised by the hon. Member for Bury, the situation in Japan. Here I find myself in considerable agreement with the cautionary words that he uttered about the tendency to think that, in an Eastern country like Japan, we can plant down prefabricated democratic institutions, and imagine they are going to work very satisfactorily and very quickly. I do riot want to be misunderstood in what I say. I have the greatest admiration for the terrific energy, the terrific drive that has been applied to this Japanese situation by General MacArthur which shows up in completely startling contrast with the inability to apply those very qualities in the European situation—for, perhaps, quite good reasons. Nevertheless, MacArthur has done an imposing job. It is a tremendous record of achievement. The demilitarisation of Japan, the purges of the police and the secret societies, the bringing into Japan of an entirely new framework of democratic principle and practice—

If the hon. Gentleman will wait until I have finished, he will see that I also have questions. General MacArthur has established in Japan constitutional principles, and laid down the structure of constitutional practice which would, if they could be made to work in Japan—if the hon. Member had waited he would have heard my qualification—undoubtedly give a basis for a democratic system in that country. But is there any reality beneath it at the moment? That I doubt. The Bill of Rights has been accorded in Japan, but its counterpart in some of the chapters and sections of the Meiji Constitution did not prevent Japan from developing into the complete police State. The new Constitution that has been given to Japan, and the new situation accepted by the Diet is, of course, a quite remarkable example of Japanese adaptability. It is a Constitution that not only expresses the philosophy of Thomas Jefferson but even incorporates its phraseology—a quite remarkable achievement of the Japanese mind. But everybody knows it was really produced by General MacArthur himself and his deputy, General Courtney Whitney—presented to the Diet, and, subsequently, to the Far Eastern Commission as a fait accompli. But I am perfectly certain that there is no possibility at all that that new machinery can be made to operate until after a long course of education that will take many years.

I believe also that it cannot work so long as the General, as is natural in an American, holds the point of view that he does, and tends to lean on all the more conservative elements in Japan. It is true that some of these conservative elements are known as "social democrats" and so on, but nothing is more misleading than to attach the same meaning to labels in that country as we attach to them here. It is my view that this new structure which is being created can only be made to work by the emergence of entirely new forces, and these new forces can only be found on one side—on the Left. This has been basic in the development of all the democracies in the Western countries. Democracy must be founded on the emergence of organs of the people in their masses, which, when they finally come to maturity, give the solid foundation on which a democratic system can operate. We must push along in every possible way to bring about the emergence in Japan of really responsible trade unions and cooperative movements, because it is on that kind of structure that the success of democracy in Japan will depend.

The hon. Member for Bury spoke about the destruction of the divinity of the Emperor. I am pretty certain that this is a complete illusion. I have noted that in recent reports in the American newspapers, which give much more information on these things than our own, how American journalists have been struck by the fact that the Emperor, in making these visits to factories and homes, in his ill-fitting frock-coat and top hat, is received with immense awe and reverence by his people. That is what is happening in the towns, but what is likely to be happening among peasants and the great masses of the people? We must remember that a divine Emperor in captivity is no new thing to Japanese history, and we know that Emperors were domestic slaves of one of the clans for nearly three centuries; and so the present position of the Emperor being in subservience to a foreign Power may easily have an echo in Japanese minds in relation to their recent history. I have the gravest doubts that to abolish the Emperor's divinity by decree will have the slightest effect. It was once said by a wise Frenchman that we cannot abolish traditions by treaties, and that is as true of Japan as of any other country.

I wish now to turn to the economic side of the Japanese problem. Here we have a situation which ought to fill every Member with a great deal of alarm. It has been stated by the head of the United States Textile Mission in Japan that it is the intention to found Japan's rehabilitation largely on the export of textiles. He has told us it is the intention in future that textiles shall amount to 80 per cent. of the total volume of exports. That means, if we subtract natural silk and silk fabrics, that about 66 per cent. of Japan's total exports will be cotton manufactured goods, rayon manufactured goods and wool, which will enter into competition with the products of every nation throughout the world. I admit that it is 80 per cent, of a much smaller volume of total exports, but it shows an intention to create an unbalance of Japanese industry, upon which the life of the country will depend, which must inevitably lead to enormous pressure by the Japanese people to extend their textile markets throughout the world. Can Lancashire be indifferent to this, and can this House or this country be indifferent? I suggest that here is a matter in which it is absolutely essential for us to have an effective voice. We should be consulted and our voice ought to be heard, and we should have a share in any final decisions. All realise that Japan must be given an opportunity to give its 70 or 80 million people an increasingly better standard of life. It may be that this is the best economic solution to that problem, and perhaps the only solution, but no one in this House, on the statistics to which we have been able to get access, can hold a definite opinion about that. If this is the best solution or the only solution for Japan, we ought to be in the position to satisfy ourselves about it. We ought to have been in on all the discussions, and we ought to have been taking our proper share in the decisions which have been arrived at. The hon. Member for Bury threw cold water on the idea that there is a possibility of removing the menace of Japanese external trade by raising the standard of life of the people. I found myself in agreement with some part of what he said. It is true that they suffer from earth tremors and experience climatic conditions which determine the character of their living conditions. But there is a difference in the standard of life of a middle class Japanese who lives in his flimsy house and experiences these same conditions, which shows that there is still an immense possibility of an upward raising of the standard of life of the masses of the people.

I think the hon. Member must have misunderstood what I said. When he has reached the optimum figure, there must still remain, owing to the conditions there, a gap between the expenditure of the Japanese worker and the worker in this country.

I would probably agree with that. Under the special conditions in Japan there might be a gap between the two levels, but in the absence of the old stimulus given to Japanese exports, by Government subsidies and assistance in external development, by raising the standard of life to as high a level as we can, we have, I think, got a counter check to unfair competition with the Western nations. Of course, all that will take time. One of the things in which we have failed in Japan is that we have accepted a form of machinery for dealing with the Japanese problem that ought not to have been accepted in the first place. I think that most hon. Members are familiar enough with the situation there. The Allied Council in Tokyo is really an advisory and consultative body on which Great Britain, as one of the members of the British Commonwealth, is represented by an Australian. I want to make it clear that in what I am now saying I am in no way implying any kind of criticism of Mr. Macmahon Ball, who is our Commonwealth representative. From all that I have read in the documents of the Tokyo Council, I am satisfied that, within the limits imposed upon him by the set-up, he has done his job excellently, and I have nothing but praise for his efforts. The policy-making directive body, the Far Eastern Commission, is sitting in Washington, many thousands of miles across the Pacific, and 3,000 miles across the American Continent. That is an example of remote control in administration and government of which we shall find very few examples in the whole of history. But, of course, it is not only a question of remoteness; it is the nature of the structure which we have created.

I should like to quote a Question and answer from HANSARD. On 28th April last, I put down a Question asking for information about a recent action of General MacArthur's in Japan, with relation to the very important question of Japanese reparations, an action taken on the direct instructions of the American State Department. I asked why that was so, and I received the following reply:
"This Order was an interim directive issued by the United States Government who, under the terms of reference of the Far Eastern Commission, were entitled to take this action without seeking the approval in advance of any other Government or of the Far Eastern Commission. On the other hand. the proposal embodied in the directive had been discussed in the Far Eastern Commission, who, though in general sympathy with its main objective, were unable to reach agreement on details."-[OFFICIAL REPORT, 28th April, 1947; Vol. 436, c. 1526.]
The meaning of that, of course, is that the State Department not only takes the right, but has the right, under the set-up now existing in Japan, to give its own unilateral instructions to General MacArthur on questions of the gravest import for the future of Japan. However that happened to arise, I say that it is a most unfortunate form of machinery. I think that what we want to do in Japan, above all, is to press now for a complete revision of the manner and the method by which the Government of this occupied country is at present conducted. We want to press for a revision of that machinery in order that the other Allied nations, whose responsibility for Japan under all the agreements of the Allies is as full and as great as that of the United States, should be considered to be, and, in fact, should be, equal partners in all the conduct of Japanese affairs. I would ask my right hon. Friend to look at this matter closely and as one of great urgency, and, even in the middle of all his tremendous other preoccupations, about the state of Europe and other great matters, to try to give some positive direction and form to a new set-up and organisation in these Far Eastern territories, which will give Great Britain once again an opportunity to play her part effectively, as she ought, in the conduct of affairs over these great areas.

12.26 p.m.

I hope that the House will not think me flippant if I only make a very short speech indeed. I wish, for a few moments, to bring the House back to the question of Russia, and to develop, in the course of my remarks, a sugestion as to where I believe the true nature of the ulcer is to be found, and what we can do to heal it. I well remember, at the very beginning of this Parliament, hearing a speech by the hon. and learned Member for North Hammersmith (Mr. Pritt), with much of which I agreed and the warning that he gave that we must be very careful to do nothing to antagonise Russia unduly. I think that that was a correct warning to give at that time. But the months have dragged anxiously by, and I would say, without hesitation, that Russia has had every chance, and has no cause to say that she has been impatiently or unfairly treated, certainly by His Majesty's Government.

We heard yesterday from the lips of my right hon. Friend the Member for Warwick and Leamington (Mr. Eden) a categorical accusation against Russia for responsibility for the failure of the Moscow Conference. Coming from my right hon. Friend, whose disinterested fair-mindedness is a household word, that accusation should cause profound thought in all quarters of this House and of the country. I do not wish to deal with the question of the specific refusal on the part of Russia to stand by the pledges given at Potsdam. But I want to say a word or two about another side of the question, which I think is of cardinal importance, and which should not be suppressed or cast aside. It is the question of the ceaseless flow of anti-British propaganda that has been issuing from Russia all through these vital months of negotiations. If the House will bear with me, I will quote from an article of a correspondent in Moscow of 14th April. It says:
"For us"—
meaning Great Britain—
"economic unity means first and foremost that the barriers which now exist between the zones shall come down.
The Russians do not seem to accept this at all.
Nor is there the slightest indication of any impending change in the Russian attitude. They remain not only stubborn, but aggressive.
Mr. vyshinski, at his Press conference yesterday, took a hand. Before a large and international gathering of correspondents, he said the Western Allies were drawing large amounts of reparations from current production, and instanced the taking of coal by Britain.
I challenged him on that point. I asked if he was aware that Britain had not received a single ton of German coal, and that every penny derived from the sale abroad of coal from the British zone went to buy food and essential raw materials for Germany.
He evaded the question, saying that it was all a question of what prices were paid for the coal, and what prices were charged for it.
I then said that this was beside the point. The point was that we were not making a single penny out of the Ruhr coal, and therefore certainly not getting reparations from it.
Again evasive action. He said there was also the question of patents, and then broke off the engagement by saying he would study the subject again if I would too.
That is a rather characteristic episode. The' charges are made. They are refuted. No attempt is made to justify them. And then they are repeated all over again.
Though this morning 'Pravda' devoted over two columns to a very detailed report of the Press conference and of the other questions asked, this episode was suppressed."
That is an article by W. N. Ewer in the "Daily Herald" of 14th April, and I cannot help feeling that if that sort of thing is going on the prospect of "one world" will rapidly fade out. The second aspect of propaganda to which I wish to draw attention is the glorification of militarism which has lately been indulged in by Marshal Stalin and Marshal Tito. In that connection, I would only observe what a contrast there is between the glory which they attribute to the merits of militarism and the regret with which we on all sides of the House have agreed to its imposition at this moment for reasons of defence.

Why is it that this ceaseless stream of anti-British, anti-Western propaganda is being churned out from Moscow? Is it because they wish, as has been conjectured, to postpone a settlement for as long as possible, if not indefinitely? Is it that they wish to hasten the break-up, social, cultural and political, of the Western world? I do not know whether that is so or not, none of us knows; all we can say with certainty is that there is no more effective way in which it could be brought about than for the economic rehabilitation of Germany to be forestalled. It may be a coincidence, but I think the facts have got to be faced. Has Russia in fact decided that the two political systems cannot possibly work side by side in the same world? Again, who can tell? It looks as if she has so decided, and if that is the case, what is the nature of the gulf between us?

There may be many opinions of the true nature of the division between East and West, but I believe they can be crystallised most relevantly and significantly under one heading, and that is the heading which is incorporated in the 11th point of President Truman's famous 12 points, namely, freedom of expression. I believe that freedom of expression is an essential condition of world unity, and until we get it, in Russia as anywhere else, we shall never attain the objective which we all wish to reach. I wish to make three concrete suggestions as to how we in this country can help to bring on the day when there will be universal realisation of the necessity for this condition. First of all, I think we should stop wishful thinking. It is no good blinding our eyes to the hostility of Russia, both in her spoken words and in her thoughts. Secondly, we must make a desperate effort to break through party differences and take an objective view of what in fact is happening in Russia and in the East. In that connection I would like to put to the House what I think is a perfect example of how not to go about this business of healing the wounds. Every Member of Parliament received two documents recently, one from the hon. Member for Ipswich (Mr. Stokes) in which he gives a factual account, passed to him by the man concerned, concerning a prisoner in Yugoslavia. This prisoner wrote to the hon. Member:
"10th November, 1945, the day before the election for the Yugoslavia Constitution— Assembly, at half-past two, I was taken off my cell and brought in the cellar, where more than 30 prisoners were transferred, and in other rooms of the cellar there were many others taken for the same reason as I. We were all obliged to remain with the face against the wall for five hours, until half-past seven. The guards said to us that if only a sound was heard we should be killed.
During the time we were hidden in this cellar Members of the British Parliament visited the prison. After their visit the British Parliament Members published in the newspapers reports on what they had seen. Of course, they could not describe the truth, because in our cells were placed, on purpose of this visit the agents of the Yugoslav secret police OZNA. So, the Members of the British Parliament could not speak to anybody who could say the truth to them and how the prisoners without being interviewed by the Magistrates disappeared or were liberated after many months."
So much for the document from the hon. Member for Ipswich. This was promptly followed by one from the hon. Member for Finsbury (Mr. Platts-Mills) which read as follows;
"You have recently received from Mr. Stokes what purports to be another of these circumstantial 'exposures' of tyranny so heartlessly practised by the European Resistance.
"The Parliamentary Delegation to Yugoslavia, to which reference is made, comprised the following Members: Lester Hutchinson, Niall Macpherson, Norman Dodds, Leah Manning, Will Oldfield, Arthur Lewis, Ernie Popplewell, Stan Tiffany, Emrys Roberts. Konni Zilliacus and myself.
Here is Leah Manning's comment on Mr. Stokes' latest 'sensation':
As one of the M.Ps. who visited the prison concerned, may I say that we were shown the whole prison from "cellar to attic" and had complete freedom to discuss, sometimes in French, sometimes in English, sometimes through an interpreter in Serbo-Croat, with any prisoner we liked, any point we liked. Prisoners were completely frank with us— sometimes critical—especially of their detention whilst evidence was being collected—but not one prisoner had any complaints to make about treatment or food or conditions—au contraire'"—
There, Mr. Speaker, is encouraging sign of European unity—
"'au contraire—they seemed annoyed at some of the statements which had appeared in the foreign Press and which appeared to them to reflect upon the civilisation of their country.
I don't believe a word contained in Mr. Stokes' Memorandum; he is always too gullible where his emotions are concerned.'"
That is the end of a quotation from the letter received from the hon. Member for Epping (Mrs. Manning). He then finishes the letter by saying:
"I have no doubt that every other Member of the Delegation would comment on the story in similar terms."
I know for instance that the hon. Member for Dumfries (Mr. N. Macpherson), who happens to be elsewhere, would not do so.
"I would not have bothered to challenge Mr. Stokes were it not for the fact that he would probably construe silence on our part as a tacit admission of the fact that his anonymous informant alleges."

I was not on either of these prison visits, but I think it is relevant to state that both visits took place on the initiative and at the suggestion of some Members of our party and that the Yugoslav authorities had only about half an hour's notice before the visit actually took place. I therefore think that the statements of this anonymous informant are subject to doubt because his whole case rests on the statement that there were many hours' notice before those people were put into the cellar, whereas in fact there was no notice.

As far as anonymity is concerned, I should have thought it only applied to the letter of the hon. Member for Ipswich; the prisoner was not anonymous to the hon. Member for Ipswich. I quite appreciate the point of the hon. Member for Gateshead (Mr. Zilliacus), but I quote both sides of this somewhat unsavoury correspondence merely as an example, as I said just now, of how not to go about it. I do not think that any good will come from this sort of backbiting between us as to what is going on in Eastern Europe, as to whether there is freedom of expression or not or whether somebody is being kept in gaol or not. I think we have all got to try to take a more businesslike view of affairs, try to find out what is happening and then say so. I hope that some hon. Members in this House, whose attitude is not helping a united front against evil wherever it may be found, will reconsider their attitude in the future and that they will be less irresponsible in some of the remarks which they make.

May I suggest that the hon. Member for Northern Midlothian and Peebles (Lord John Hope) should pay a tribute to my hon. Friend the Member for the Forest of Dean (Mr. Philips Price) whose articles on Yugoslavia, Greece and Turkey commanded support in all quarters?

I should be delighted to do so, but I want to finish my speech within reasonable time. If I started paying tributes where they are due I should occupy most of the remaining time of this Debate. However, I congratulate the hon. Member for the Forest of Dean (Mr. Philips Price) on his valuable articles.

I believe that the best contribution for this country to make is to continue to proclaim fearlessly in the face of all difficulties and insults and obstacles the indispensable necessity for freedom of expression throughout the world. Let the hurricane blow around us and let the waves of the storm lash us, if we stick to our lights and keep burning the bea- con of tolerance and of truth, which, after all, has been our tradition, we may once again save the world by our example.

12.44 P.m.

am very glad to follow the hon. Member for Bury (Mr. W. Fletcher) and the hon. Member for Norwich (Mr. Paton) in speaking on the Far East. I rather think that in this country too little attention has been paid in recent years to this area and has been concentrated to a great extent on European affairs. I was glad when we were taken to the vast spaces of the Pacific and Indian Oceans this morning by the two hon. Members I have referred to, because profound changes are taking place in the Far East at this moment, and in the Far East there is another field of contact between the great Powers. In March and April of this year there was held in New Delhi an Asiatic Relations Conference, at which most of the Asiatic Powers were represented. I am glad to say that we had an observer there. At this Conference it was proposed that in future Japan should be represented by delegates. Finally, an Asiatic Relations Organisation was set up with the intention of providing mutual aid and assistance to member States.

This movement in the Far East has the very greatest significance for us, not merely because we are a European Power but because we are members of a great Commonwealth stretching all over the world. At the Conference, Pandit Nehru made one statement which had a great effect on the delegates. When I read it, it also had a great effect on me. He said in the past in Oriental countries the trade channels had been so constructed by the Western Powers that the normal or natural flow of trade did not result, and in future these particular channels would be broken down and trade would flow country to country in the Far East in its normal and natural way. This must have a great significance for us as a great trading Power. The papers in the Far East at that time gave much more space to this Conference than they did to the Moscow Conference. In fact, they reported it verbatim.

In the Far East there are two great Powers—Imperialistic Powers, I regret to say—the United States and Russia. The Russian interest in China has declined since 1941, not I think because she wishes it to decline, but because since 1941 she has had her hands pretty full elsewhere. When occasion warrants she will return to her interest in the Far East and particularly in China. I always take the North-Western province, that of Sin Kiang, as one of the barometers of Russian pressure, and certainly the pressure there has declined since 1941. There is no doubt about Russia's concern at the prospect of a unified and strong China, dominated by the United States, and when her European commitments will enable her to do so she will take a much more active part in the Far East, and particularly in China, than she has done in the past six years

The United States ate vitally interested in the Pacific and have been for many years. There is no doubt they dominate the Pacific Ocean and the China seas and they are seeking to dominate the Indian Ocean, too. They know that we propose to leave India and Burma and they will then try to extend their influence into these countries.

There are three points of contact between the great Powers in the Far East, China, Japan and Korea. We have heard a great deal about China and Japan from the two speeches of the hon. Member for Bury and the hon. Member for Norwich, with most of which I agree. There is one point on which I do not agree with my hon. Friend the Member for Norwich, and that was when he criticised the Foreign Secretary or at any rate his Department for lack of interest in the Far East. On the other hand, he said, quite truly, that never before in these areas was there such a feeling of good will towards this country. If one of the ends of diplomacy, as I am sure the Foreign Secretary would say, is to establish good relations with other countries if the hon. Member for Norwich is correct, I think that it is a great pity that the Foreign Office take an interest in Europe, because they have succeeded in establishing good relations in the Far East. I do not think they established those good relations merely by a policy of ignoring the great problems out there. I believe the Foreign Office have been working with more subtlety in the East than we have given them credit for. I may be wrong, but at least, if we criticise them when we think they are wrong, we should give them credit when things go right.

With regard to China, the United States has traditionally taken a great interest in that country. For the last 150 years the young American has looked Westward from the Atlantic seaboard, first to the Alleghanies, on to the Missouri, to the High Plains beyond and from the High Plains to the Pacific Coast. Young America has always gone West. When he got to the Pacific Coast he looked West again. From 1898 onwards America succeeded in obtaining a series of Pacific islands leading to the China Coast and in 1899 the Chamber of Commerce in America described China as
"one of the most promising spots for an American invasion of the markets of the world."
During the last 10 years or so American interest in China, partly business and partly sentimental, has been reinforced by their dread of Communism. I believe that recent American interference has had a disastrous effect on the life and economy of China. I do not agree with the hon. Member for Bury, who regarded it as a beneficial effect. I think it has been positively disastrous. Although many American troops have departed from China, they have given a very large amount of military, economic and political help to General Chiang Kai-Shek which has resulted in the reactionary party which surrounds him retaining control. Had it not been for this American assistance, I believe that the democratic forces around him would have been able to oust the reactionary forces. There is still a very large group which is called "M.A.G.I. C.," a singularly inapt description. It is the Military Aid Group in China. There is also the 7th Fleet H.Q. there. The Americans are also on the main land at Tsingtao, which is opposite Port Arthur, and are there obviously to watch what the Russians are doing at Port Arthur.

In March this year General Marshall said that the form of the Constitution being laid down was democratic and from that he argued that the new Government of China was one which could be assisted because there was a form of democracy in China laid down by the Constitution. The Constitution reads all right, but, of course, it does not work. Senator Vandenburg recently called for a shift of emphasis in the United States policy which would make the United States decidedly less neutral than they had been in regard to the China civil war. Then there is the commercial treaty with China, which has been mentioned in the House, and which was signed on 4th November at Nanking, by which the nationals of both countries will have the right to
"carry on trade throughout the whole ex tent of either country in which they reside"
to
"engage in, and carry on, commercial, manufacturing, processing and scientific activities which are not prohibited by laws and regulations enforced by duly constituted authorities."
and to exploit the mineral resources of their respective countries. As one can hardly expect the Chinese to exploit the minerals of Pennsylvania or the timber of Oregon one imagines that all the exploiting will be of Chinese products on the part of the Americans. The result has been that the Chinese, especially the democrats and the Communists, say that they are completely tired of American interference, and sick and tired of this bolstering up of a reactionary regime, and this gives us a great opportunity. I believe that for the first time in history we are regarded by the Chinese as their true friends. There is for us a great feeling of warmth and friendship for what we have done for them and for what they hope will be done by us in the future.

In Japan, as has been mentioned this morning, the Americans have imposed what they consider to be the American way of life. That is the secret of what is happening in Japan. Whether we consider that a good thing or not, depends on our idea of the American way of life. But General MacArthur has in fact become the new Shogun, and has' absolute control. This is not altogether a bad thing, because it avoids dissension among the rulers such as we have in Germany. There is one authority instead of a number of authorities. To that extent it is a good thing, but it is quite clear that the American is the dominant Power, because on 6th September, 1945, President Truman made a directive to Genera] MacArthur in which he said:
"In the event of any differences of opinion among the Allied Powers, the policies of the United States will govern"
There is no doubt about that. On the Allied Council in Japan, unfortunately, and perhaps in view of that directive, there has been considerable bickering between the United States representative and the Russian representative. Our representative has been doing his best, not always successfully, to sit on the fence and sometimes coming down on one side or the other. I think on the whole he has done well. A Conservative Cabinet has been put in office by General MacArthur and the new Constitution was drafted not by the Japanese, but by officers of General MacArthur's headquarters. If one did not know that to be a fact it is easy to observe because the language is not Oriental. It reads more like sentiments expressed at the Zenith Rotary Club and is not the language which one uses in the East. It will be interesting to see how long the Constitution lasts when the Americans pull out.

To some extent the Americans have acted as receivers of stolen goods in Japan. There were large quantities of goods, tin, rubber, lead and the like, taken from British possessions, not the property of Governments, but of private individuals, to Japan by the Japanese. Those goods have never been handed back, in spite of Questions in this House, and no compensation has been paid. We know very well they have been taken to America. There is no authority for that in international law or in natural justice, and the value of these goods should be paid back to the many true owners, British and Oriental. We have been told that in Japan they are to go back to the 1934 standard. This is a most serious matter for the rest of the world, because that standard, as my hon. Friend the Member for Norwich pointed out, was an entirely artificial one, bolstered up in order to obtain money for armaments by the Japanese Government. If that standard is going to be maintained, it is going to mean that the purchasing power throughout the East will fall, and consequently there will be unemployment in this country, not only in Lancashire and other places, but also in America. The danger is that slave labour and American mechanisation in Japan will cause grave problems in the rest of the world and that United States unemployment will be exported to Japan, re-exported and boosted by Japan. Japan is taking China's place as far as the United States are concerned, and while we all agree that there must be a decent level of subsistence that level will not be possible for the rest of the world unless there are the safeguards of political democracy and proper trade union organisation in Japan. I think we should insist on, and see that our Foreign Secretary insists on, our representative on the Allied Council making a demand for proper political, democratic, and trade union organisation throughout Japan. The Zaibatsu, the great combines of finance and business houses, although nominally destroyed, have only been nominally destroyed. General MacArthur did not even accept the advice of the American experts who went to advise him, and the wealth still remains in the hands of a few families. A control board has been set up but should the American Forces go from the country the power is still in the hands of the 11 sinister families who have ruled Japan for so long.

I wish to say a word about Korea. There the military decision was taken at Yalta and Potsdam to divide the country at the 38th parallel. The North was to be occupied by Russia and the South by the United States. This was intended to be a purely military decision, and I believe it was taken on the military level, and not the political level. Since then the two countries have not agreed as to the manner of election and government with the result that this division is frozen and has a most depressing effect on the political an economic life of Korea. It was intended that there should be a Four Power trusteeship in Korea in which we would take part. One is glad to see that there has been a new approach between Mr. Marshall and Mr. Molotov on the work of the Joint Commission which is now sitting. We hope that a common policy will accrue. I would like to ask the Foreign Secretary what are the hopes of a Four Power trusteeship, and whether we intend to fulfil our part in Korea, as provided at Yalta and Potsdam.

What is our policy in the Far East? I do not think any of us could really say explicitly: it perhaps is rather tenuous, and it is not exactly clear. We can, however, suggest to the Foreign Secretary what it should be. We have no arms or money now, at all events for export. We have ceased to be an imperialist Power, but we have goods of certain kinds which we would like to exchange for goods from other countries. There is, in these countries of the Far East, a dislike of the political extremes identified with the two Powers I have mentioned, and there is a great interest in our social experiment of a planned economy with political democracy. Therefore we can export ideas, the most potent export of all. We can help them in the way suggested by my hon. Friend the Member for Norwich by expert advice, by information, by contacts with the Labour Party, the trade unions and co-operative societies in this country, by contacts in the Dominions and Colonies, by making Hong Kong a shop window of democracy. I was glad to hear Hong Kong mentioned by the hon. Member for Bury. We can help them by courses of instruction arranged in the Colonies and by inviting students from the Far Eastern territories to our universities and to the universities in our Colonies, particularly in Hong Kong and Singapore. This is the way in which we can assist the nations of the Far East. This is the way in which the Commonwealth as a whole can assist them. I say "the Commonwealth" rather than this country, because, our Dominions and Colonies can help in many ways in which we cannot. I believe that the Commonwealth as a whole has a wonderful opportunity now to be a great power for good in the Far East. In the past our power has sometimes been an evil one. I regret to say it was at times evil many years ago. Today we have the power to be a force for good, and we should here and now declare that we will take the path which, will enable us to exercise this force.

1.3 p.m.

If I do not follow the hon. Member for South Croydon (Mr. Rees-Williams) into the field of Far Eastern affairs, it is because I can make no claim to the competence which he so manifestly enjoys in that field. In this Debate we have, as is right and proper, surveyed mankind from China to Peru, or thereabouts. I would venture, in the language of the B.B.C., to return the Debate to this Continent, and particularly to the Moscow Conference. Like other hon. Members, I followed the activities of the Foreign Secretary at Moscow to the best of my ability through that admirable instrument, the Press. Like other hon. Members I rejoiced to see the right hon. Gentleman return undiminished in volume and undejected in demeanour. But when I listened to his comprehensive survey of the activities of the Conference itself yesterday, I marvelled that he should have kept dejection so successfully at bay, because on balance it was an almost uniformly depressing picture, it seemed to me, which he had to lay before the House. There was no question, as in the case of Dr. Johnson's friend, of cheerfulness keeping breaking in. It did not break in, or almost never, and very timorously at that. We were given a story of almost negligible agreement and most formidable disagreements.

I entirely agreed with the right hon. Member for Warwick and Leamington (Mr. Eden) when he said that nothing is gained by claiming that after all the disputants discovered each other's point of view. What did the right hon. Gentleman find out about that which he did not know before he went to Moscow? He knew the infinite capacity of the Russians for negation, and beyond infinity one cannot go. It does not seem to me that any new positions were taken by any of the three negotiators, or that any one of them learned any more about the others than he knew already. But the right hon. Gentleman belongs to a party which believes in facing the future. That is the task which lies before him and us now. The vital question is, the situation being as it has been shown to be, "Where do we go from here?" Before answering that I would like to say at once that wherever we go from here it appears to me to be of vital importance that we go in step with our friends and Allies in the United States. Like a good many other hon. Members, I am sick and tired of the grudging, carping, hostile references to that great country which we so often hear in this House.

There are aspects of life in the United States which may not appeal to us. There are aspects of life in this country which do not appeal to the Americans, but after all, among the great Powers of the world, we are the only two successful democracies. I know, of course, that France is a democracy, but no one who looks at her Parliamentary history over the last 30 years can claim that she has made Parliamentary democracy a success. We can claim that we have made it a success; so can the United States. It may not be precisely the same kind of democracy as ours, but an American might, perhaps with some reason, claim that never has his Congress violated the methods of Parliamentary democracy as they have been violated in this House this week. We do not only speak the same language. Broadly speaking, we think the same thoughts, particularly in international affairs. If ever there is a rift of a serious nature between us and the United States, then I can see the whole world falling to pieces.

Quite apart from that, which I regard as so fundamental that it hardly needs to be discussed, we must develop, in every way possible, our contacts with individual European States. I was glad to hear what the right hon. Member for Warwick and Leamington said yesterday about establishing the closest contact with that group of States which is now making closer contacts within its own circle—Holland, Belgium and Luxembourg. I was glad to hear what the Foreign Secretary and the right hon. Member for Warwick and Leamington said about our relations with France, and what the Foreign Secretary said about our improved relations with Poland. That carries us on inevitably to the question of a United Europe, about which the hon. Member for Penryn and Falmouth (Mr. King) had something to say yesterday, as had other speakers hardly less eminent the night before, at an important meeting, the salient feature, I gather, being a characteristically witty remark by my right hon. Friend the Member for West Bristol (Mr. Stanley).

We have heard a great deal of the organisation of a United Europe. That is a conception full of superficial attractions and full of underlying dangers. I do not know precisely what is in the minds of those who advocate this United Europe, because I have never seen it very clearly defined. One thing is common to all interpretations of the project—that neither the United States, perhaps naturally, nor Soviet Russia, should have any part in this organisation. It is perhaps natural that the United States should not have a part in a United Europe, but let us not forget that the United States is becoming very much integrated in Europe. The United States co-operating with us in Germany, and it was even suggested last night that we should leave her to do the work there alone. That is a suggestion which I repudiate as strongly as the hon. Member for Oxford (Mr. Hogg) did. Here is the United States in Germany and in Greece. Obviously, there is a very good superficial reason for associating her with any European organisation. I do not want to lay stress on that.

What I feel is absolutely fatal to the conception which is being expounded, is the exclusion of Soviet Russia from it. If there is any nation in Europe with which we need to make closer contact, it is obviously Soviet Russia. We ourselves have a Treaty with Russia and yet she is to have nothing to do with a European organisation. France has a Treaty with Russia and yet France is to tell her she is not to come into any European organisation. The only purpose—I do not say the only object nor, perhaps the only purpose, but the only effect—of such a policy is to drive her further into that isolation from which it is our main desire to extract her. We tell Russia that she stands by herself, that she is separate from Europe and has no part in any European organisation. But, of course, there is much more than that. Is it conceived to be possible that we could create a United Europe, tell Russia the is to stand outside it, and then expect Russia's satellite States to come in and take their places within it? Are we to get Poland to join a United European organisation from which Russia stands aloof, and are we to get Yugoslavia or Bulgaria? If we exclude all those states, we shall simply have a Western European bloc, call it United Europe.

I have noticed that none of the speakers who enlarged on the subject of United Europe, and particularly on the economic aspect of it—I entirely agree with the hon. Member for Smethwick (Mr. Gordon-Walker) that the economic aspect may be much the most important in the first instance—none of the speakers who have enlarged on that, have taken any account of the fact that there has just been created a European Economic Commission as part of United Nations. It should be remembered that all nations in Europe, including Russia, are members of United Nations, whether or not they agree at this moment to take part in the Economic Commission. I very much regret the energy and time that is being given to the exposition of this theory when I cannot help thinking that it might be devoted to some more immediate and more practical purpose.

The outstanding question in Europe, as it appears to me, is how, if it be by any means possible, should we get on terms with Soviet Russia. It is very difficult to make any suggestions which have not been made before. Obviously, the door may be forced a little way open by means of trade relations. I welcome most warmly, as I am sure do all hon. Members, the report that was brought back from Moscow by the Secretary for Overseas Trade. He has been there, he has paid an extremely useful visit. We do not know completely what the results of it will be but, at any rate, I think there is real ground for hope. If we can develop trade with Russia, if we can develop trade, as the Foreign Secretary encouraged us to believe, with Poland, we shall have made new contacts which can be developed and which, in time, may bring new understandings.

Also, something can be done through the broadcasts of the B.B.C. I was astonished, when the Soviet delegates visited us recently, to hear from them with what avidity the B.B.C. broadcasts are being listened to throughout Germany. I imagined that there would be some endeavour on the part of the Government to frustrate listeners, but it appears that that is not the case at all. The one complaint was that the B.B.C. does not give enough time to its broadcasts to Russia and, particularly, to its lessons in English. That can be developed. I agree that it may be said, "What is the use of getting across concrete objective facts when you have a population of 170 million, and all the policies of the country are run by half a dozen unknown men at the politburo?" There is some validity in that argument, but, after all, if we have any confidence in the permeation of ideas, if we have any confidence in the open mindedness of Russian youth, the youth that is coming out of the schools and universities every day, then, as facts get into Russia, they will gradually have some effect, and may have the effect we all desire.

Then, of course, something may be done—again I realise it would be on a limited scale—in the way of personal contacts. If I may refer again to the visit of the Soviet delegates recently, as hon. Members know, many of them were astonished and a little scandalised to find that the social relations between the Prime Minister and the right hon. Member for Warwick and Leamington were something short of venomous animosity. As far as it goes, that was quite a valuable education to the Russian delegates. I asked one of them what had struck him most during his visit to this country. He said at once, "The picture of George Washington in the National Portrait Gallery." It struck him as remarkable that we should hang in one of our national collections the portrait of a man who had made a successful revolution against us. That is a lesson in tolerance which may be salutary and which may be carried back to the Soviet Union by our guests. That is on such a small scale that it is hardly worth dwelling upon. My point is that if these contacts can be developed by exchanges of visits between members of the professions, teachers, doctors, lawyers, scientists, and the rest, at any rate we shall have made a small gap in the iron curtain which cuts off so effectively knowledge of the outside world from the people of Russia.

Speaking broadly on the subject of Europe, I would like, finally, to express again my agreement with the hon. Member for Smethwick. It is of the utmost importance that we should develop our economic contacts with the nations of Europe to the best of our ability, not merely for material reasons but because they open the way to other contacts. People who buy from and sell to one another, are bound to co-operate to a certain extent, even if they are trying to overreach each other all the time. The more we can develop these contacts, the more our business-men go to Other countries and the more business-men from Europe come to this country, the better understanding is likely to grow up.

But we are conscious of the momentous months that lie immediately ahead of us. The Foreign Secretary told us yesterday that the conference to be held in November will, in his view be the most momentous in the history of the world. How can those intervening months be used to create the best possibility of success when that conference meets? We do not need to trouble to try to develop harmony with the United States. That is there, and will remain there anyhow. We do not need to trouble overmuch about develop- ing harmony with France. That is there and, difficult though France's situation is in many ways, I hope that it is not going to develop in such a way as to create any difficulties about harmony between her and ourselves.

The one dominating question still is Russia. How can we work, in the remaining six months, to create an attitude of mind on the part of the rulers of Russia that will enable success to be achieved at the November Conference when it was not achieved in the Conference out of which we have just emerged? I do not suggest for a moment that the right method is anything that can be called, or miscalled, appeasement. I think one of the great debts that we owe to the Foreign Secretary is the fact that he stood absolutely firm when suggestions that were unreasonable, and which would have worked out disastrously, were put before him by the Soviet delegate. Our business is to go more than half-way to meet Russia whenever she adopts an attitude which can be regarded as reasonable, but to stand firm in those cases where her attitude is one we cannot endorse.

I would regret bitterly any decision which meant that we must go forward without Russia, but I recognise that cases may arise where that will be necessary. There are certain cases where we cannot stand still—the administration of Germany is one. If Russia will not co-operate, if Russia will not act according to the spirit or the letter of the Potsdam agreement, then the other signatories to that agree-men must go forward together and make the best they can of the Western Zone of Germany. That is fundamental. But, I would like to feel that in these months that lie ahead, that the Foreign Secretary is devoting almost the whole of his time to the one task which matters above all others in the world—searching for some means of establishing a better understanding between us and Russia before we have to go into conference with her again.

1.21 p.m.

The hon. Member for Cambridge University (Mr. Wilson Harris) said that a rift between us and the United States of America would make the world fall to pieces. The reality of the situation today is that a rift between any Powers would make the entire world fall to pieces. It is abso- lutely essential that we avoid rifts between any of the major Powers in the world at the moment, and it is impossible, therefore, to believe that to cement the situation between us and the United States would solidify and guarantee peace in the future. That is an unrealistic assumption.

I was glad to hear the hon. Member for Cambridge University mention that he believes a practical approach between us and the U.S.S.R. would be to develop our trade. We were all delighted to hear a report from the Front Bench that an approach to the possibility of trade was to be made in the future, but what some of us tend to forget is that of every country which participated in this war, no country suffered like the U.S.S.R. I was delighted to hear the Foreign Secretary say yesterday that he was prepared to recognise Potsdam, and was prepared to recognise the position with regard to reconstruction as far as reparations from Germany were concerned. I conclude from that that he does not blame Potsdam for the position inside the British and the American zones at the moment. When we talk of trade with Russia, we know that she has suffered one of the worst famines for 50 years, that she has had 65,000 kilometres of railway destroyed, 4,100 stations in South-East Europe and Russia destroyed, 15,000 bridges, rolling stock, and sea vessels. She has suffered, and she has, therefore, to build up before she can exchange. There are 25 million people homeless in the part of Russia that the Germans over-ran, and the grain areas are only producing half of their pre-war production. Therefore, when we talk of getting goods from Russia, we must remember That she has a problem the magnitude of which is greater than any of the other Allies at the moment. Nevertheless, she has intimated that she is desirous of resuming trade as soon as possible. The U.S.S.R. monopolises her foreign trade because she believes it gives greater certainty to the seller. I was rather surprised to hear only the other day during Question time one hon. Member asking whether we could be sure we should be paid. On no occasion has the U.S.S.R. failed to meet her financial obligations in connection with trade transactions; always have her financial obligations been met on time. I believe that the speech of the Foreign Secretary yesterday—sober, careful, a statement of fact—gives us some hope of understanding with the U.S.S.R., because I see a slight change in our outlook so far as Poland, and our relationship with the South-East of Europe and the rest of the world is concerned.

Having taken up those points, I want to deal with a part of the world which the hon. Member for Bury (Mr. W. Fletcher), the hon. Member for Norwich (Mr. Paton) and, I believe, the hon. Member for South Croydon (Mr. Rees-Williams) have discussed. We always listen with interest to the hon. Member for Bury when he talks on the Far East; we know that he speaks with knowledge, and, therefore, we respect what he has to say. While I agree with much that he said, I must disagree with many of his conclusions. To analyse the present world situation with a 19th-century outlook on trade, is completely to misunderstand the "dynamic situation of the world at present. The entire foundations of the acquisitive society of the 19th-century and the fabric of the 20th-century have been shattered since the first blast of the atomic bomb at Tokyo. Today the real struggle is a struggle for oil, for sources of power, for control of routes and markets for investment, just as it was in the 19th-century. It is just the same struggle in the belief that that is the way to get security. I believe that if the foreign policy of the United States of America or any other country follows that line of struggle for oil, markets, routes and areas of investment, then once again the world will be involved in war. It is because I see a different trend in our foreign policy these last few months that I welcomed yesterday the statement made from the Front Bench by our Foreign Secretary.

Looking at one aspect of our foreign policy in the Far East, I do not agree with the hon. Member for Norwich when he says that our Foreign Office does not take enough interest. I am quite convinced that the Foreign Secretary is overwhelmed with problems so far as Europe and other parts of the world are concerned. I know that, when I came back from Indonesia, he was giving as much attention as anybody, and so was the Foreign Office, to this vast problem. I agree with the hon. Members for Bury and Norwich however, when they say that so far as the British troops in Indonesia were concerned. although there were incidents, they did a job of work and maintained a balance. I regret that the Dutch and even the Americans failed to realise that in that part of the Pacific zone it was the British troops who were bearing the brunt of cementing a system of society that might establish peace in the Pacific zone. We have not been given enough credit in America or Holland for what we tried to do in Indonesia.—[Interruption.] Or in this House, I agree. I agree that incidents took place, but for every real trend in policy there, not enough credit has been given either to this country or to the British people for bearing the cost of it. If the United States of America and General Marshall can withdraw from China because everything is not going according to a clean-cut mathematical formula, we are just as entitled to cut our losses in Germany or Palestine or anywhere else. The problem in China was much easier for the United States of America than the problems we have inherited in the Middle East, because the conference tables of the world at the present moment are smeared with oil. Looking at this area in the Middle East—and at other parts of the world such as the Pacific—one sees that the smear of oil still stains the conference tables of the world. The special United States Senate Committee dealing with oil said this:
"The first principle of American petroleum policy, therefore, should be to sustain our domestic supply of petroleum, and to maintain the American system of competition and free enterprise at home and abroad. To these ends we should follow a foreign policy designed to promote full development of the petroleum re-sources of the whole world for the benefit of all peoples of the world."
That second paragraph of the statement is admirable. The first paragraph states that they can do it under private enterprise. If America believes that the world's oil resources should be developed for the benefit of the people of the entire world, I want to know what has happened to the 1945 Anglo-American agreement on oil. What is the present situation with regard to the discussion in 1945 between the United States and us about petroleum supplies? There were three British representatives and three Americans on the International Petroleum Commission. Their object was laid down categorically. It was to keep the whole international oil position under con- tinuous agreement. Recently in the United States of America, John Loftus, the chief of the Petroleum Division of the State Department, was criticised by reactionaries because he suggested that the oil supplies of the world should come under the United Nations Organisation. I believe that unless oil does come under that organisation, the position so far as Foreign policy is concerned for Britain, America, Russia and the United Nations will be almost impossible.

The Middle East is one of the richest oil areas in the world, and there we have one of the great difficulties. In 1940, while the average output of an oil well in the United States of America was nine barrels in a certain period, in the same period the average output of an oil well in hail was 2,800 barrels; in Saudi Arabia it was 1,400 barrels, and in Iraq it was 740 barrels. There is the key to much of the problem as far as the Middle East is concerned, and, in this struggle for power, we must realise, that in 1947 as in 1917, as Clemenceau said, a drop of oil is worth a drop of blood. If the world plays power politics once more, United Nations or no United Nations, these raw materials will draw us down into the vortex of war. That is why, at a Blackpool Conference some years ago, when one of the greatest speeches on foreign affairs was made by our present Foreign Secretary, who spoke about the pooling of oil and raw materials, we applauded because we believed it was possible. It must be made possible in order that civilisation may go on. These materials must be pooled for the uplifting of the standard of life of Eastern man and, in some places, backward man.

I have asked for some particulars about the United States Commercial Corporation. We speak of an iron curtain so far as Russia and the South-East of Europe are concerned. The hon. Member for Bury referred to the rubber curtain which he lifted aside in order to look into the business of Japan. I also am concerned about the standard of life of these Eastern people. Let me put a proposition. I may be wrong, but in my analysis of the situation, if there are some people so silly as to think that the joint forces of the United States and Great Britain could stand together in a war against the U.S.S.R., let them not run away with the idea that the U.S.S.R. would be with- out friends in the world. I believe the Far East, rightly or wrongly, would look to the U.S.S.R. for leadership. In the Netherlands East Indies there are oil, fats, quinine and all the modern necessities to carry on a major war. Although we might have a few hundred atomic bombs at the beginning, it must be remembered that we would be dealing with over half of the world's peoples. They would be wedged together, with food and oil supplies, and there would be such a war that civilisation would never recover from the shock.

It is not a question of lining up with America or with the U.S.S.R. It is the duty of the U.S.S.R., the U.S.A. and all the peoples in the world to realise that the United Nations Organisation must be made a reality, or civilisation will collapse. That is why I deprecate these struggles for power in the Pacific Ocean. The United States, has said "U.N.O. or no U.N.O.," they must have Pacific bases. Russian has never made such a flagrant statement. At no time has the U.S.S.R. said "U.N.O. or no U.N.O., we shall do something." As General Smuts said, the Pacific Ocean will decide the history of the world for a considerable period.

The hon. Member for Bury spoke about buying cheaply and selling dearly. Surely, there is something more in life than mere business. What is the answer to capitalism? If hon. Members do not like that word, I ask what is the answer to the acquisitive system which buys cheaply and sells dearly. Am we going to withhold a proper standard of life of the yellow man and the brown man so that Huddersfield and Lancashire can find textile markets? Those who talk of buying cheaply and selling dearly are afraid of the competition of Japan and of the yellow man. The world can no longer maintain those standards. The diagnosis of our time seems to indicate that we have to find a new formula for the integration of civilisation, and for the selling and exchanging of world goods.

I am not egotistical enough to think that my party has all the answers, but believe we are beginning to get a key to some of those answers. Just as in the Middle Ages the key to men's minds hung on the girdle of a priest, so in this century the key to the emancipation of mankind hangs on the watch chain of the big-business man. We in the Socialist Party do not approach the question of Japan from the point of view of power politics. According to some writers in American journals, Korea is being looked upon as a place from which to jump in order to attack the Siberian areas of the U.S.S.R. Alaska is being developed as it has never been developed before. Such an approach will be absolutely fatal. We cannot ask the young of America, Russia and Britain to lay down their lives every generation for some myth like the saving of democracy. It has been saved ostensibly twice. It is the duty of those now living to find the key to real democracy and to get civilisation nearer to the solution of this problem. We must alter our approach to the question of the Pacific Ocean, for there, even as in Germany, lies a danger to civilisation.

We have heard speeches about food. I discussed this question with Dr. Sjahrir and representatives of the Indonesian Government. Am I right or am I not when I say that the approaches to Indonesia are being blockaded by the Dutch? Is that the thanks we are going to get for the sacrifices our men have made? Am I right or not in saying that Indonesia has food supplies which she could give to the world? She has struggled to send some rice into India during the famine period. Am I right or not when I say that the United Nations organisation have not approached that country on the question of the distribution of food? Why have they not done so, so that food can be sent to parts of the world where its needed? These are vital problems, and the Government should take the initiative with the Government of the Netherlands East Indies. It is through the exchange of goods that men grow to understand each other.

I would like to summarise a practical point so far as the Pacific Ocean is concerned. The "Manchester Guardian" refers to General MacArthur in these terms:
"Japan is still ruled by General MacArthur in his old imperious way, and neither the Far Eastern Commission in Washington nor the Allied Council in Tokyo has affected the situation"
It would be unfair of me to take that quotation from its context. I cannot agree entirely with that statement in the "Manchester Guardian" in 1946. All I say is that America is not asking the Powers to co-operate in the organisation of Japan as she should. The result is chaos, black market and vast unemployment in Japan. The trade union movement is not getting a chance to flower in japan as it should do. The United States mission at the moment are discussing a scheme for the resumption of trade with Japan. These plans are strongly opposed by Australia. There is a conflict within the Commonwealth of Nations itself. The Australians and the New Zealanders desire a territory where they tan exchange goods. They are asking when there is to be a settlement so far as reparations are concerned. The United States are claiming 30 per cent. of the total and ask that China should have 45 per cent. I understand that machinery has already been sent out of Japan. Approximately 1,000 industrial plants have already been taken out of Japan and shipped to China.

Finally, one thing that Japan taught the world was that the small electric motor, the motor truck and the small machine tool taken to the peasant in the Far East was one of the things to build up trade. She gave a lesson to the Western world, by showing that the way to develop the Far East was by taking electric power, the motor truck, ribbons of asphalt or roads rather than the railways, and the small machine tool to the door of the peasant, so that he could build up his industry with the most modern machine, in a small way, at his own doorstep. I believe the United Nations organisation must investigate this by an entirely new economic approach. The Far East is of vital importance to the modern world. Given that economic approach, given a living belief, given a belief that the world is now so small that what happens in Tokio affects Tottenham, that what happens in Buenos Aires affects Birmingham, we shall see the unity that is wanted. I believe the Foreign Secretary is as fully aware of this problem as anybody on either side of the House. I hope that in future he will give us the opportunity of having perhaps a two days' Debate on these vital problems of the Far East, in relation to world peace and the United Nations organisation.

145 P.m.

I am sure the hon. Member for Leek (Mr. Harold Davies) will excuse me if I do not follow him. I believe this Debate has been notable for the interest that has been shown in the terrible state of Europe. First, I want to ask the Foreign Secretary if he is fully seized of the nature of the situation in Tripolitania and Cyrenaica, where the frightful drought which has just occurred may well lead to starvation on a scale even worse than is taking place in Europe. I was very relieved to see in the Press the other day that 40,000 tons of barley are being sent; but I doubt very much if that is enough. In connection with those two ex-Italian Colonies, I should like to ask the Government what policy they propose to adopt in regard to this very difficult question.

I believe my right hon. Friend the Member for Warwick and Leamington (Mr. Eden) was right in raising this subject, and in saying—and I am sure hon. Members in all parts of the House will agree with him and with me—that there must be no question of handing the Senussi back to the Italians. Not only were their leaders dropped out of aero-planes and their wells blocked up, but every possible indignity was forced on these people by the Fascists under Mussolini.

It is easy to discuss this problem, but it is not so easy to be constructive. However, I draw the attention of the Foreign Secretary to the suggestion made by my tight hon. Friend that the Senussi should be allowed to govern themselves, under the guidance of Sayyid Idris, and they should decide what alliances they are to make. I believe that is right, because whatever may be the present propaganda being put out in the Arab world, it would probably not meet the wishes of the Senussi for Tripolitania and Cyrenaica to be one state. The issue is far more complicated as far as Tripolitania is concerned because of the minorities. When the Government come to discuss this question with other Governments of the United Nations, it may well be they will find that an invitation to a Scandinavian State to come and help. Tripolitania would be a very good solution. There is a financial liability here, and in the case of Tripolitania I do not think this country can undertake it.

I also wish to refer briefly to the question of the Sudan, to which my right hon. Friend referred yesterday. Anybody who knows Egypt and the Middle East at all well will be very smypathetic to the Egyptians' anxiety over the Nile. Their whole future, and the whole prosperity of the country, would be jeopardised by any works started South of the barrages by any Power with the object of taking away the water. My right hon. Friend was right in saying it is the far more narrow nationalistic spirit which is growing up in some of the Arab states in the Middle East—a feeling of amour-propre— which is pressing for the removal of our influence in the Sudan. We have a definite moral obligation towards the Sudanese, and I implore the Government to make our attitude clear. I know the question may be sub judice and may go to the United Nations organisation, but I do not think it would be improper to ask the Government what attitude they will adopt.

Throughout the Middle East, the whole of the Arab world is alive and awakening; great changes are taking place, and we must welcome those changes. It is quite certain that we in this country are the natural friends of the Arabs; and the Arabs are by their outlook on life and their religion our friends. It is, however, unfortunate in this great awakening, that any violent nationalism should arise; and it is even more unfortunate that it should be accompanied at present by a violent propaganda campaign against His Majesty's Government and the Foreign Secretary's policy. Nothing struck me more forcibly in Cairo during the Inter-Parliamentary Conference than the very large amount of propaganda issued by the different delegations, and the fact that the Government issued nothing at all to contradict untrue statements made by Egyptians. I cannot see how the Foreign Office or the Government can carry on and put over the British view with the existing set-up. Personally, I consider the English papers in Egypt to be extraordinarily bad; they always have been since I have known them. At present, I do not think they are putting over His Majesty's Government's point of view as they should do. I realise that the role of the British Council is limited, but I am not very impressed with the work it is doing.

I think that the large sums we are spending in Egypt at the moment are not being properly used to get the British point of view over. We have a good case over the Sudan, and we have a desperately difficult situation in Palestine; but we are getting all the kicks from both sides. When one flies across North Africa into Egypt and sees the places where many of our friends lost their lives, and when one lands in the Delta and sees the anti-British propaganda as soon as one arrives, one is impressed by the lack of gratitude which exists in the world. No one expects very much gratitude. I think, however, this veneer of anti-British propaganda is really in the case of Egypt, and in the case of some other countries, rather superficial. It is part of the local party politics. I would say to the right hon. Gentleman, that I hope very much he will not be too much influenced by the views of people who live in the Delta, whether of British or other nationality. This problem of the Middle East is a vast one. Like the problem of world peace, it is a problem which cannot be divided into small subsections or cells. I do not think by taking the situation in the Delta we shall get the results we want. We must take a broader view, and approach the whole of the Arab world now on a generous basis.

But I do believe that His Majesty's Government—I must say this—have been guilty of doing too little and doing it too late. I thought it was a mistake not to move the troops out of Cairo and Alexandria earlier. As it was we slunk out, and slunk out too late, and gave a feeling of going with ill grace. I do not know how His Majesty's Government can put our view about. Perhaps, it could be done by broadcast. But somehow we ought to do far more in this respect. The House will probably have heard the story of a great demonstration that took place in a certain Allied country after the war, and vast numbers of Allied soldiers walked down the street with their banners inscribed, "We won the war." Behind them came a small band of British Legion men in bowler hats, with their badges, and with a banner with a tiny little typed notice which said, "We helped." I think that that type of understatement would be most effective in the Middle East because the one thing that those people have is a most delightful sense of humour.

Nothing struck me more at the Conference than the manner in which the Members of this House spoke as a united team. It was noticeable to see how the Members of the French Communist Party always voted against their colleagues. I think it is a most important thing to build up the Inter-Parliamentary Union, so that Members of Parliaments can present their points of view and can agree amongst themselves, when a controversial subject comes up, to take reasonable and responsible views. That means that foreign affairs must be ruled out from party politics. At the moment it is not easy to see how that can be done. I think my hon. Friends on this side of the House will agree when I say it is going to be particularly difficult if the Government continue to put us in such embarrassing positions. I personally had never been so embarrassed as I was when, 24 hours after leaving the country, one heard that the period of national service was to be reduced from 18 to 12 months. It was impossible to convince our friends or our critics that the balance and judgment of the Government were sound. There seemed to be no explanation why, 48 hours after the Government Front Bench had convinced the House 18 months was necessary, the period was to be reduced to 12 months. Hon. Members who influenced the Government to make that decision did great harm to the future peace of the world, because people abroad do not now look upon this country as a balanced team which will undertake responsibilities and carry them out.

I am perfectly certain that we should make our position perfectly clear as to what we shall do in Palestine if U.N.O. fails to make a decision. I do not believe, if U.N.O. fails over Albania and Palestine, that we shall have the confidence in U.N.O. that we have now. We shall not necessarily have none, but it will mean that we must make decisions ourselves. The Government are in the position now that it will be difficult for them to meet our commitments in the Middle East, and I want to know what commitments we are going to give up, and what plans are going to be made for not staying in the highly populated districts but for using desert posts as air bases from which our interests can be defended. I do not think that the removal of our troops from the Middle East would do anything more than create a vacuum and the grave danger of more war. I am perfectly certain the time has now come for the right hon. Gentleman the Foreign Secretary to turn his attention to this part of the world. I know that real affection for Britain and admiration for our great prestige lie underneath the veneer of hatred and criticism in many of the Arab nations. He must get a solution for the trouble in the Middle East which will create one part of the world where the anxieties which beset mankind may cease, and where all may work to raise the standard of living and of human happiness.

1.57 p.m.

I should mar the spirit of free, happy companionship which existed among the party of British delegates attending the conference in Cairo, and to which the hon. and gallant Gentleman the Member for Hythe (Brigadier Mackeson) so happily contributed, if I were to enter into controversy with him now over his last remarks. But I feel I must take up just one point. His reference to the English papers in Egypt today is hardly justified. I feel that if one were fully aware of the tremendous difficulties under which they labour today one would realise that British papers in Egypt put up a really magnificent case for British honour and prestige in the Middle East.

I should like to bring the attention of the House to another part of the world, which, to my knowledge, has not been referred to so far in this Debate. I wish to speak of the problems of Persia. If any of us today are susceptible to a passing mood of despondency and depression at the present trend of world politics, we have only to consider Persia today to take new hope. Curiously enough, Persia today is an area where only 12 months ago such hope could hardly have been expected, and it is a very striking commentary on the complete unpredictability of international affairs today. Scarcely a year ago Teheran was a storm centre of world politics. It was then occupied by three of the world's great armies. Today, not a single foreign soldier stands on Persian soil. What are some of the events that have happened in Persia during the last few months to bring about such a startling change? As recently as last August negotiations were in progress between the Persian Government and the leaders of the independence movement of Azerbaijan. These negotiations dragged on right through the month of September, 1946. Early in October outside pressure began to call for a new general election to take place in Persia and for new concessions in North Persia in the matter of oil. In early October the decree for the general election was issued. Then the Tudeh party began the organisation of a joint democratic front with leaders of the independence movement of Azerbaijan, by which they suggested a distribution of the seats in the Majlis, which would have placed Qavam's party in a very small minority.

The Prime Minister, Qavam us Sultaneh, was quick to seize the opportunity and throw out the three Tudeh members of his Cabinet, with the result that in November the negotiations were suddenly broken off, the Azerbaijan leaders returned to Tabriz, and the general elections were declared. The Persian Prime Minister then seized on the very shrewd step of distributing Persian troops and inspectors throughout the different provinces to supervise the conduct of the elections. Despite outside pressure Qavam persisted in his actions, and followed them up, on 10th December last year, by sending Persian Government troops into Azerbaijan. Some of us may have had a good deal of misgivings about the fighting qualities of the Persian troops, but from the moment they crossed the border, all these misgivings were dispelled, because they were at once hailed as liberators and were garlanded with flowers, receiving extraordinary demonstrations of welcome from the population. In two days Tabriz had been entered with hardly a shot fired, and within seven days the whole of the Province of Azerbaijan was under the control of the troops of the Central Government. Even more striking, the leader of the Independent Movement, Pishevari and his chief supporters, were refugees within the frontiers of Russia. Many of us may speculate what their future might be, but I think it is reasonably safe to assume that the Russians do not readily forgive a failure.

One might speak at some length on other major developments which have recently taken place in Persia, of the rebellion in Kurdistan, of the rising which took place in the Southern Province of Fars, and of the great troubles which occurred in the Anglo-Iranian oilfield, but there is hardly time now to go into details on how these events developed. What is of interest is the result of the recent elections which have taken place in Teheran. When I was in Teheran three weeks ago, 80 results out of 136 had been announced, and of those results which had been declared, no less than 80 deputies were supporters of Qavam. Of the remaining 56 seats where results are still awaited, it will occasion a great deal of surprise if the Tudeh Party are able to secure a single supporter. This is hardly the place to speak of how these elections are conducted. A good deal of criticism might be levelled at certain aspects of these elections, but the fact remains that we now find a Government in Persia which for the first time commands almost the unanimous support of the majority of the Persian people. Some Members of this House were privileged recently to meet many of the newly elected deputies, and to have informal talks with Qavam and several members of his Cabinet.

Today Qavam is claimed as the popular leader of Persia, and more particularly is the symbol of the removal of outside foreign influence. He struck us as being an elder statesman, shrewd and experienced, and a man who is completely master of the political situation in Persia. Although he may be described as ruthless on occasions in the face of danger, I believe that he is first and foremost a Persian patriot. No one can pretend that the Tudeh Party has completely disappeared. It is perhaps more true to say that it has been driven underground. It is more than possible that it will reappear in the near future under a new guise. Now that Qavam finds himself in a position of undisputed mastery over the governmental machine of Persia, I believe his hour of triumph is the hour of his opportunity. What is the real significance of these tremendous changes that have Gone on in Persia? I believe that within the clash of rival ideologies, for the first time an entirely new factor has been introduced amid all the posturing, posing and manoeuvring of foreign representatives on Persian territory. The situation today is as if the chessboard had suddenly come to life and swept away all the paraphernalia of pawns and players who had been manoeuvring for position on it. It is true to say that a new spirit has asserted itself in Persia. It is as if the people had suddenly risen and proclaimed to the rival ideologies;
"a plague o' both your houses."
Today there is a resurgent national spirit in Persia which can revive the ancient glories of this great people. The Persians, like the Greeks, have the attributes of a gifted people and are endowed with exceptional qualities of heart and intellect. The great task of Qavam is whether he can succeed in reviving in Persia the spirit of national pride and independence. If he does succeed in doing this, he will deserve well of his country and of the world. Today the crown in Persia stands as a symbol of national unity. Its prestige is higher than it has been for many years, and it is steadily increasing.

Very much more, however, is needed than merely a revival of the spirit of independence. The seven-year plan must be translated from a blue print into a living reality, and the people must be shown that the Government are in earnest, otherwise they will lose faith and fall a ready prey to foreign interests. At the top of the major measures which the seven-year plan proposes, is the complete development of the health services of the country. Enormous work can be done in creating new hospitals and sanatoria, and especially in building up higher professional standards among the doctors in medical treatment. A vast new educational programme can be undertaken, by the building of new schools and the extension of existing universities. A vast field exists for the development of labour relations, whereby the Government can show the Persian workers that they have the interest of the workers, upon whom the prosperity of Persia primarily depends, closely at heart. Enormous reforms can be carried out in land tenure and agricultural development. On other matters, such as water supplies and irrigation, the Government can do a great deal to help in a practical way. The major concern of Teheran today is when the new water supply to the city will be completed. This is a concession which has been handed over to British engineers, and here the Government can do a great deal directly to help, by seeing that they are provided with the materials which will enable them to fulfil that contract in the stipulated time

The people of Persia today are looking to the great Powers of the world for moral encouragement and assistance. The new Mejlis will find itself, in the near future, pledged to open negotiations with Russia for the granting of oil concessions in North Persia. The position today is bristling with all sorts of complexities, but it is one which should be left entirely to the Mejlis to decide. There was a possibility that the Mejlis would be convened by the end of this month. Now there are other factors which may delay the assembly of the new Persian Mejlis. But public feeling in Persia is now so strong that it would resent, and justifiably resent, any further concessions of any kind to foreign Powers. If this should happen, our own position in the Anglo-Iranian oilfield would become one of special delicacy and complexity. We are pledged to hand back the complete concession to the Persian people in the year 1993, but it is most important that, in the intervening period, we should see to it that during our trusteeship we prove ourselves to be exemplary employers.

I have been privileged to see a little of the enormous housing schemes, the medical schemes, and the educational and technical training schemes which the oil company has carried out around Abadan. Such schemes should prove themselves to the Persian people to be models of their kind. At the moment, however, they do not compare favourably with many of the housing and welfare schemes of British companies in several of our own overseas territories, such as the undertakings of the Bibiani and Ashanti Companies on the Gold Coast. We must save ourselves, in our dealings on the Anglo-Persian oilfield, from any risk of reproach that we have acted too late and done too little. Such schemes are already long overdue, and they should be speeded up. I would ask the Government to afford every facility to the oil company to ensure that it receives its supplies of raw materials to enable these vast schemes to be completed in the shortest possible time.

We must plough back as much as we can into the territory from which this country has drawn so much wealth What is to be the. future of British policy in Iran? We should today hold ourselves aloof from all the cross-currents of Persian nationalism which are now finding their feet. We should adhere to the policy of complete non-participation in the internal affairs of Iran, and we should not exercise any influence or pressure of any kind on their internal affairs. The sign of our strength, and of our moral prestige, must be today, that we will resist, at all costs, any temptation to cash in on Russia's diplomatic reverse, so that our influence in Iran will remain simply as a symbol of friendship and goodwill to all the Persian people, and to all other foreign Powers. Above all, let us try and assure the Persian people of our interest in Persia's welfare, and of our desire to see her working out her own problems in a way best fitted to the character and capacity of the Persian people themselves. There is an old Arab proverb. "The dogs do bark, but the caravan passes on." Rival interests in Persia today may snap and snarl all around her, but she will continue on her course unmoved, to achieve her own destiny. Persia has many friends in all parts of this House, and today we watch her development with anxious sympathy, willing to assist her in every way we can to make her own distinctive contribution to the prosperity of the Middle East, and to the peace of the world.

2.16 p.m.

; I should like to have addressed a few remarks to the House on the subject of the Middle East, but I realise that time is short, and, therefore, I will content myself by saying, following upon what the hon. Member for Preston (Dr. Segal) has said somewhat fully at this stage of the Debate, that Persia is an example, as I see it, of the success that can be obtained by firmness in this country's foreign policy. I think that all that the hon. Member has said should have proved that to the House.

Before passing away from the Middle East, I would like to reinforce some of the arguments used by my hon. and gallant Friend the Member for Hythe (Brigadier Mackeson) about Egypt and the Sudan. I hope that His Majesty's Government are not going to barter away the interests of the people of Sudan, in the hope that they may gain by that barter in our discussions with the Egyptian Government, and, particularly in the Chancellor of the Exchequer's discussions with the Egyptian Government. I hope that this country will never barter away other people's rights for any money, or anything like that.

The main point I wish to put forward very shortly is this. Throughout yesterday, the House became aware, if it was not aware of it before, of the tremendous danger there is because of the lack of agreement between the Great Powers at the present time over the postwar settlement of Europe. The delays that have resulted in Germany, and, as I am going to show, in Austria, will surely defeat the purpose of this Government, and, I believe, of the whole House. Though we are now quite certain of the evil results of those delays, so far as Germany is concerned, and though we have taken action to remedy those evils, even at this late hour, by the new fusion agreement, about which the right hon. Gentleman the Foreign Secretary informed us yesterday, I believe that we are not fully aware that the same danger applies to Austria and to the former Italian colonies. I hope that we shall not let that uncertainty drift on, either in Austria or in the former Italian colonies.

I have a particular interest in Austria. I was out there on one occasion last year, and it was my privilege to finish up there at the end of the war. I am astonished that there should still be any doubt about the attitude that will be finally taken up in the Peace Treaty over the Yugoslav claim to Carinthia. I believe that His Majesty's Government have made their attitude quite plain, but I hope that they will say again today that they are not going to give in to the entirely unjustified demands of Yugoslavia in this respect. Quite apart from the ethnical arguments used by Marshal Tito, there can be no doubt, when one goes to that part of the world, that the Caravankan mountain range is the proper border between Austria and Yugoslavia. I believe that the uncertainty about that matter is doing very nearly as much harm to the future of Austria as is the uncertainty about German assets there. Unless we get certainty over these two points, there will never really be any recovery in Austria. What is to happen? I ask the right hon. Gentleman who will reply, what is to happen if this lack of agreement over Austria between the Great Powers continues? Are we to have another fusion between America, France, too, we hope, and this country, or have we some other scheme for getting on with the recovery of Austria? I believe that that is as important to us and to the world as the future of Germany. We cannot go on giving in to this lack of agreement and doing nothing; we must do something. If we do not, we shall be contributing towards what some people consider is the purpose lying behind this lack of agreement on the part of our Russian allies. We have our policies on what we want to happen in Austria, and in the Italian colonies too. I have no time to deal with them, but I hope we shall realise that delay defeats those policies.

2.21 p.m.

As time is short I will only make two points, as briefly as I can. The first is to attempt to refute the view which has been very current since the end of the Moscow Conference that failure to agree there represents a turning-point in world affairs, a turning-point for the worse, and that, in the words of the "Economist" last week, we must now go our respective ways. I agree that, on the immediate issue of the fusion of the American and British zones in Germany, it may be true that we cannot wait any longer to make a practical job of Western Germany in conjunction with America, though I hope, as the Foreign Secretary said, that we shall always keep the door open for the wider unity of Germany. In the broader sense I believe that the failure at Moscow should not be taken to represent a turning point, and I say that for the specific reason that I think the main causes of disagreement were essentially of a short-term nature.

I would like to give one example There was the question of economic unity, rightly demanded by ourselves and the Americans in pursuance of the Potsdam Agreement. As I understand it, the Soviet Union did not reject this in principle, but tried to tie it up to a particular view of reparations policy. France did not object to it, but she tried to tie it up with the question of immediate coal deliveries. We wanted it, but we nevertheless quite rightly tied it to a sharing by the Allies of all the past deficits in respect of these zones. It was upon the conditions, and not on the principle of economic unity itself, that the Ministers could not agree, and I think it emerges clearly from this that the dominating factors in this conference were the immediate difficulties of the countries on their own respective home fronts.

We know that Russia needs reparations to help rebuild her devastated areas. We know that France needs coal. We know that our first priority at the moment is to get a balance of exports from, and imports into, Germany, to take the load off our taxpayers. I think it is in the fact that these preoccupations are essentially of a short-term nature that the hope of eventual agreement can be found. It is false arid dangerous to describe the failure in Moscow as though it indicated a parting of the ways. Indeed, since the Conference ended there have been one or two signs in the contrary direction. There has been the improvement in relations between ourselves and Poland, and there has been the prospect of increased Soviet trade, and I therefore think that the lesson of Moscow is that we must persevere in what were perfectly good policies before Moscow, and still remain perfectly good policies, rather than attempt to find a dramatic switch to something new.

If we wish to reduce this obstacle of reparations to something like the right proportions, what we have to do, as the hon. Member for Devonport (Mr. Foot) said, is to see that other means of reconstruction outside reparations are available to the countries which need them most, and that means loans. It means big loans, and it means loans given on a nondiscriminatory basis, because it is very largely Russia and her neighbouring countries, with communist or near-communist governments, which most need those loans; if there is discrimination, those are the very countries which will not get them. It means that the loans must be given, if not through international machinery, at any rate on principles sanctified by international agreement. It means full use of the International Bank, and full use of the Economic Commission for Europe, which is only just being formed.

That brings me to my second point. I think the United Nations may be said to have been "damned with faint praise" in this Debate. It has been said that we have had it for two years, and it has given no assurance of security and done nothing in the economic field, while having cost four times as much as the League ever cost. Let us be accurate about this. It is only 16 months since the first Assembly met, to set up its own organs. It is only just a year since the organisation began to set up a temporary headquarters on the other side of the Atlantic, and was able to hold its very first meetings to deal with economic and social problems. Of course, we agree that the veto is a dis- advantage, but the veto, I would remind hon. Members, only applies to the Security Council, and need not hamper any of the economic work which we in this House are all agreed is really the vital problem for Europe. Already a great deal of reconstruction work has been done by U.N.R.R.A., the European Coal Organisation and the European Central Inland Transport Organisation, which may all he considered as part of the United Nations system. I believe it is a great pity that more United Nations relief was not agreed on, to follow the immediate first-aid given by U.N.R.R.A.

We have already got the machinery for economic reconstruction in existence. The Economic Commission for Europe, the International Bank, the Food and Agriculture Organisation, the World Health Organisation—it is, if I may say so, nonsense to suggest that in this very brief time the United Nations has not done a great deal of what is necessary towards economic reconstruction in Europe. If anyone thinks this is a bad record, they grossly under-estimate the problem of welding together in a united policy all the various national economies, which were designed on traditional, separatist lines. For Heaven's sake let us use this machinery, upon which over a year's hard work has been spent. Even if we welcome the loans made to Greece and Turkey, let us tell the United States that we would sooner see loans for reconstruction given in a different way, and more in accordance with the principles of the Charter, because I believe that if loans continue to be given a discriminatory basis we can say goodbye to any agreement on a reparations policy. The key to that, I would remind hon. Gentlemen, lies not in Moscow but in Washington.

It is perfectly true that the clash of ideologies makes this more difficult. It makes every discussion more difficult. But I believe that the real problem of European and of Soviet politics at this time is, if I may use the phrase of a Labour leader of the last century, a "knife and fork" question. If we make it clear that international co-operation offers to the peoples of Europe and of the Soviet Union an improvement in their living standard, I believe we shall get international cooperation. We have the machinery to do it; now is the time, not to scrap that machinery, not to look for some mysteri- ous new thing which none of us can quite define, but to use the machinery we have got for the economic reconstruction of Europe and the world.

2.28 p.m.

I agree with the hon. Member for Grimsby (Mr. Younger) that we should be quite wrong to regard the breakdown of the Moscow Conference as finally closing the door to co-operation with the Soviet Union. Equally I think it would be wrong to under-estimate the difficulties of widening the rather narrow aperture which exists at the moment. The Foreign Secretary yesterday gave us a very full account of the Conference. He intimated that he was not over-optimistic at any time about its successful result; I can hardly see that he could have felt otherwise. It is not only in racing that the book of form is a useful guide. The previous running of the Soviet delegation at former conferences certainly seemed to suggest that the red flag would signify that a number of objections had been upheld. It is certainly a bitter commentary on human nature that nations find it so much more difficult to co-operate in peace, when the objective is to consolidate what has been won in war with so much bloodshed, than they found co-operation in war, when the objective which bound them together was the destruction of the common enemy.

I believe that we do ourselves a great disservice, both in this House and to the public outside, if we do not attempt to answer the question why so far there has been almost complete failure to reach agreement with the Soviet Union in the general task of peace-making. The answer to that question is that the Soviet Union takes a fundamentally different view from that of the Western Powers about the principles which should govern the conduct of the weary, hungry, and war-stricken nations in the post-war world. There is thus no common objective which binds us together in peace as there was in war. There is not even common interpretation of words like "freedom" and "democracy." That is, I believe, the fundamental divergence of opinion, to which we must face up and which I believe it is wrong to underestimate. What appears to us in this country or in Western Europe or in the United States to be suspiciously like a police state is in Russian view a democracy. What they often term Fascist or reactionary seems to us to be the result of the free use of the ballot box. Until agreement is reached on these fundamentals I believe it is no good denying that Europe is not one unit, but it is divided in the same way as are the zones of Austria and Germany.

If I agree that no agreement is better than a bad agreement, I should like to emphasise that the sands of time are beginning to run out fast, and, as my hon. and gallant Friend the Member for North Blackpool (Brigadier Low) said, to take no effective action anywhere for fear of offending the Russians is a policy of despair, which brings the worst of both worlds in its train and is fraught with fearful consequences. We must get busy and rebuild that portion of Europe which prefers to interpret democracy and freedom in the sense that we interpret them if we wish these principles to survive. We have made some progress in that direction. The Foreign Secretary reminded us of the Dunkirk Treaty, and he also told us, much to our relief, that agreement had been reached for the fusion of the British and American zones in Germany. I only wish that that had been accomplished sooner. We and the United States are at any rate in no disagreement about ideals. The offer of economic aid to Greek and Turkey is of momentous importance. It marks the end of the isolation period in American foreign policy. I must confess that I never quite understood On what grounds the critics of that particular offer of economic assistance based their case. In some quarters criticism of President Truman's offer is based on the ground that it was not made within the general ambit of the United Nations Organisation. Surely, economic assistance to Greece, who nobly served the Allied cause and brought much suffering upon herself in the process, and to a country like Turkey, which has never menaced anyone since 1917, is entirely consistent with the spirit of the United Nations Organisation.

I would willingly give way, but I have not the time. On the other hand, there are ample precedents in that part of the world for action taken without reference to U.N.O. The Soviet Union have taken action in Bulgaria, Rumania and Poland during the recent elections. The United Nations Organisation was not consulted before British destroyers were mined off the Albanian coast nor have the United Nations been allowed to come to an unanimous decision in condemnation of that action. Surely we are entitled to help those countries which are anxious to receive help from us. It is useless to go to war for a cause and then, having won the war, to let that cause go by default.

If the United States have abandoned the isolationist policy and are prepared to pull their weight in the Old World as well as in the New, I believe it would be the worst mistake that we could make to pull out of our commitments as America comes in. To do so would cause widespread resentment and misunderstanding in the United States. We spring from a common stock and we have common burdens to share.

I hope the Foreign Secretary will realise the exceptional gravity of the questions put to him by my right hon. Friend the Member for Warwick and Leamington (Mr. Eden) when he asked what obligations we cannot now fulfil which, in the words of the Minister of Labour, we could only fulfil if the period of national service was fixed at 18 months. We have reached a stage when the Government must arrive at a decision as to which of the two courses are to be taken. If we wish to remain a world Power, the lynchpin of the Commonwealth, we must discharge our world-wide commitments. On the other hand, if we are unable or unwilling to discharge those commitments we cannot remain a world Power, and the unity of the Commonwealth will be broken up. That is a very grave responsibility which falls on His Majesty's Government, who have to decide what overseas commitments we can still discharge and what we have to give up in view of the shorter period of national service. I hope right hon. Gentlemen realise the very great weight of their responsibility in deciding whether we remain a world Power or whether we cease to function in that capacity at all, and the consequent effect upon the human race and upon civilisation.

2.37 p.m.

We are now approaching the concluding stages of what has been a most valuable and interesting Debate. Members on all sides of the House approach Debates on foreign affairs with a special sense of responsibility. On internal policy acute and controversial questions come daily before us. For good or ill, we are shaping the future of our people. Yet in this field, while there is much that may be done amiss, laying the seeds of trouble and confusion, there is not the same sense of finality. What is (lone wrong now can later be remedied. The path can be retraced. In home affairs the evil that Ministers do does not necessarily live after them, and as for the good we feel we could do without that if we could be sure of their early political demise. In the realm of foreign and imperial affairs we are all conscious of the vast issues at stake. Many of us twice in our lifetime have seen a frightful and seemingly inevitable development of those grim international tragedies moving on with the relentless inescapability of a Greek drama.

In these Debates, therefore, there is of should be a special sense of responsibility weighing upon every Member, and if we have criticisms to make they are made regretfully yet tentatively—in a spirit of co-operation and understanding—for we recognise the heavy burdens which lie upon Ministers, especially upon the Foreign Secretary. The prolonged and exhausting conferences—the sense of disappointment and even of futility—must be very wearisome to him. He has our sympathy. But it Would be wrong to conceal under compliments or platitudes our alarm at certain aspects of the European situation, which seem to show deterioration rather than improvement. Many important questions have been raised in the Debate by hon. and right hon. Gentlemen on this side of the House. I will not traverse this ground again. I will merely try to restate one or two broad issues which have emerged in the Debate, balancing what is good and encouraging against what is bad and depressing. The first immense contribution to the good side, to the profit side, of the ledger, is the recent American initiative. We cannot but be glad that the United States have taken a decision, a non-party decision, binding equally upon Republicans as upon Democrats, to abandon isolationism, and to recognise the truth that the safety and prosperity of the New World is inextricably bound up with the restoration and reconstruction of the Old. Let me give an example.

I cannot help recalling the situation at the time of the Greek Revolution, in the winter of 1944–5, and contrasting it with the position today. At that time, from the outbreak of the Communist attempts to seize power by a coup de main, till the final signing of the Peace of Varkisa, Great Britain stood alone. Alone we carried both the military burden and the relief burden. The operations of U.N.R.R.A. were not functioning at that time. The Commander-in-Chief had to detach British and Indian Divisions from his Army at a time when he was already preparing the final battles which ended triumphantly in Italy in the spring of 1945. While his headquarters was integrated with the American headquarters, in every sphere by sea, by land, by air, in the economic field and in the harassing and expensive field of relief, our American Allies were, on instructions from a higher level, scrupulously neutral. Neutrality of comrades in a siege is not very pleasant. Meanwhile, a flood of ill-informed attacks upon the honour and integrity of British policy was let loose from a considerable part of the British Press. Equally ill-informed and spiteful attacks came from some of the least scrupulous of the opponents of the Coalition Government, some of those who are now the nominal colleagues, and some the open critics, of the Foreign Secretary.

It says a great deal for the good temper and commonsense of both nations, that the relations between British and Americans in the Mediterranean area were never unduly strained, but each understood and accepted the position of the other. Happily, the confidence and comradeship of over two years' campaigning laid behind us, and I must add that much of the credit was due to the personal example, under great difficulties, of that great soldier and great gentleman, under whom we were all proud to serve, Field Marshal Alexander. I am not of course saying that every step taken in Greece, either then or since, has been necessarily wise. I am not arguing that. I say quite frankly that I think some of the Foreign Secretary's conduct of Greece affairs has been rather obscure and hesitating. I do not share the view that you can keep a large body of troops in a friendly country without having a very high degree of responsibility for the internal affairs of that country, both political and economic. I was always rather sceptical of the doctrine of strict non-intervention in Greek affairs. In such circumstances, it had very little reality, for there is no greater intervention than military intervention; moreover, I would admit that certain tendencies which developed in the last 18 months or two years could have been checked by a stronger diplomacy.

However, I know only too well how easy it is to criticise without always having a full knowledge of the facts. The point I am making today is, Has there ever been a more dramatic reversal of policy than that of the United States towards Greece in two short years? Has there ever been a more complete endorsement of British policy? Has there ever been a more sensational justification of the wisdom of what we did then? The revolutionary Communist fire was lit in Athens in the winter of 1944, and but for us, but for the British, that conflagration might have spread throughout what was left of free and democratic Europe. If we now pass to the United States, our great Ally, some part of the duty we first accepted, and which we carried out loyally and to the full, we hand it on in pride, and not in shame,
"Our task accomplished and the long day done."
But if we have the right to be gratified by this vindication of British policy we cannot conceal from ourselves some of the reasons underlying recent developments of American policy. They spring, alas, not from an improvement but from a serious deterioration in the state of the world. It is no good trying; by discreet circumlocution, to conceal the truth. America, like Great Britain, has of course a tradition to defend freedom, but for that purpose she is now forced to stake out strategic positions in Europe as her defence against the potential thrust of expansionist Russia. These are precautionary measures, but they are none the less defence measures. It is no doubt, in an exhausted and shattered world, only a war of nerves; but a war of nerves may be very dangerous. Unless within some reasonable time a genuine accommodation can be found between the Communist world and the democratic world, who can say that the same tragedy which we have seen twice in our lives may not be repeated, this time finally and fatally? I do not think, therefore, that there is anything to be gained by concealing the truth from ourselves

The Foreign Secretary and Mr. Marshall went to Moscow with hope, if not with confidence, but the mood of the return from Moscow, I will not call it "The retreat from Moscow," cannot be anything but sombre. The truth is to some extent covered up by the usual phrases of diplomacy, the usual communiques issued by the Press Departments of all the Foreign Offices. The Foreign Secretary told us—I use his own words—that he was "neither unduly pessimistic nor optimistic." Nevertheless, two blunt facts emerge. First, the Conference was a failure on all major issues; second, the Conference will not meet again for six months, and in all the vital matters at stake time is not on our side. On the contrary, it is impossible to resist the suspicion that the Soviet Government is deliberately following the tactic of procrastination. Does Russia want to see Germany re-emerge as a free and democratic nation? General Robertson said—I think my right hon. Friend quote his words:
"The longer Germany's problems are left unsolved, the more difficult it becomes to solve them."
Is that also the expectation of the Soviet Government? Does Russia mean to secure, by a fait accompli, the transfer from Germany of the rich agricultural lands across the new Polish-Germanic frontier? Much has been said in this Debate on the question of the Oder-Neisse line. I very much hope that the Foreign Secretary, when he replies, will be able to speak some reassuring words on that. So much for Germany.

The failure to agree upon an Austrian Treaty, in spite of all efforts at accommodation, is even more disappointing because it ought to have been easier. It is also very alarming and its implications are serious. Is it the intention of Russia never to allow a free and democratic Austria? Is the partition of Austria to be permanent? We must most warmly congratulate the Foreign Secretary on a marked success which he achieved in writing the principle of the internationalisation of the Danube into the Peace Treaties with Rumania, Hungary and Bulgaria; but if the Danubian Conference takes place within six months and the three satellite countries, together with Yugoslavia and Czechoslovakia, are at the Conference, and Austria does not participate because no Treaty has been made, then I fear that we shall end up not with the inter- nationalisation, but with the Sovietisation, of the Danube. Meanwhile, as one of my hon. and gallant Friends said, the great Jugoslavian pressure upon Corinthia continues, as it does upon Trieste; in a word, all over Central and Eastern Europe the massive struggle has begun. It is decently covered up beneath the outward forms of peace and diplomacy, but it would be folly to disguise from ourselves the truth. What then can we do? What course, not already embarked upon, can we steer? How can we make any new plan or policy? I would venture to make to the right hon. Gentleman a few suggestions which I hope he will regard as not unhelpful. First, I think we must continue quietly, but firmly, without recrimination, but without vacillation, to resist unreasonable Russian pressure wherever it may be brought upon us or our friends. Secondly, as has been stated in this Debate, we must make effective the Anglo-American Agreement for the control of the two zones in Germany which was supposed to have been made in January last. It has been far too long delayed. High hopes were raised in January last, only to be dashed down. Let us develop it even beyond the present conception of zonal co-ordination.

I must say, frankly—this is not criticism either of this Government or the last—that had we been able to foresee the extent of Russian non-co-operation, it would have been far better never to have embarked on this cumbrous zonal machinery. At any rate, it would have been better, judging after the event, I say frankly, if we had kept the machinery of S.H.A.E.F. in being and had a joint American, British and French occupation of their part of occupied Germany. There are differences between the British and American points of view, naturally, but it is much easier to iron out these differences and get agreement under an integrated command.

My small experience of military and commission government was confined to Italy. It was quite difficult enough there, 'but it would have been much more difficult, indeed impossible, if we had had a British zone and an American zone not co-ordinated by an integrated Allied military government system. From my experience, I am bound to say that I sympathise a good deal with the American view of many of the matters where there is some divergence between the British and the American point of view in Germany. I think His Majesty's Ministers are wrong in trying to favour a form of Socialist economy, and trying to build up political movements which they think more or less in harmony with the economic and political movements ideas which they are trying to impose upon the British people.

Would the right hon. Gentleman allow me to interrupt?

I am sorry, I really have not the time. I think perhaps they feel that it is only right and fair that the vanquished should be made to undergo some of the sufferings to which the victors have to submit. At any rate, what the right hon. Gentleman told us yesterday was a little obscure in this matter. However, from some words he let fall in column 1745 of the OFFICIAL REPORT, I gathered that he intended to consult German opinion as he went along. Apart from all that, however, it is my experience that the Americans as a whole—what I saw of them in Italy and what I have learned of Germany—favour a rather looser administration, with rather less bureaucracy, less centralised power, a smaller personnel in military government, and are more ready than we are to transfer power and authority to the indigenous institutions of the country. The British tendency, especially favoured during the War Office regime—and I had the same experience and, therefore, am especially delighted that the Foreign Office have taken control of this matter—the British tendency is the opposite. It is to build up very large staffs, very large personnel, and to try to control every detail with the traditional rigidity but, alas, with little of the traditional discipline of the military machine. For these are not really soldiers, many of them. However, I feel sure there can and will be an accommodation between these slightly different points of view, the British and the American. All I say is this: that if we cannot get a single economic unit in Germany, we must organise the Western zone, French, British and American, as quickly as we can. It is no use waiting any longer for Russia; we must make the fusion a success and a reality.

We would be very grateful if the right hon. Gentleman, when he comes to reply, could give us a few further details of this new agreement. We should welcome further information about the structure of the bi-zonal agencies. Has the coordinating machinery only been outlined and sketched? When will it be implemented? When will it be in real working order? What is the proposed method for the association of the bizonal machinery with, the two commands and with German organs of administration? In other words, has there only been an agreement to agree or perhaps just the general outlines of a new structure? Or is there now ready a working plan which can be put into immediate effect for, make no mistake, time is of the very essence of this matter. We must raise German production, we must give Germany a chance to save herself and, incidentally, our very precious American dollars. That was very well said by one hon. Member opposite. If we fail, the problem next winter will be tragic, perhaps catastrophic. I do not believe that such a catastrophe could be of advantage to the Western nations or to the Western way of life. It will only let loose once more the forces of evil and destruction. These considerations far outweigh the danger of offending Soviet susceptibilities or arousing Soviet suspicions.

Thirdly, we ought to do everything we can to encourage those nations still struggling to be free. Some months ago there was a Debate in this House on the question of the Tyrol. On that occasion, I suggested that there was an Italian as well as an Austrian side to this problem, and I rejoice that the Italian Government realised how much the sympathy which they hoped to get from Britain depended upon a sensible and honourable solution to this question. It is very gratifying that an Austro-Italian agreement was reached, and if it is a little galling to admit that one of the few sensible things which have been done since the war has been between two enemy Powers left entirely to themselves, without anybody to advise them, yet, nevertheless, it is full of hope for the future of Europe.

Meanwhile, I hope His Majesty's Government will be as tolerant and helpful towards Italy as possible. The British and American Forces will soon be withdrawn, leaving Italy subject to considerable outside pressure. The terms of the treaty which we think are, perhaps, fair, have been deeply resented in Italy. The Italians feel that while they have worked their passage, they have not had a very good pay-off at the other end. The future of the Italian Colonies is still unresolved, and the prestige of any Italian Government—we have seen the result in the recent crisis—has been much weakened by all the treaty. I would only say this, and I say it with absolute sincerity: Italy, with her 40 million population, with her strategic position in the Mediterranean, and her long cultural history, and in view of what she has given to the world, should be made prosperous and free. That is a British and American interest in every sense—political economic, moral and material.

Fourthly, without, disloyalty to the United Nations organization, but in accordance with its principles, indeed, in the whole spirit of that organisation—and I was glad to hear the hon. Member for Grimsby (Mr. Younger) remind us as we should be reminded, that we should riot expect too much in too short a time—we must take the lead and ask France to join us in this crusade in building up a sense of coherence and unity among the nations of Europe. No one who was present at that great gathering at the Albert Hall two nights ago could fail to be impressed by the weighty and luminous arguments put forward by so many speakers, so diverse and so representative. Nor should we be deterred by fear of sensitiveness on the part of the Soviet Union. I have observed, in any case, no undue sensitivity or consideration by the Soviet Union for the sensibilities of the democratic countries. As Mr. George Gibson very well said—and I think he expressed it best of all the speakers that night—
"the United Europe movement is not anti-Russian, nor is it anti any other nation; it is pro-Europe, pro-peace and pro-prosperity."-
I can quote no authority of greater respectability than an ex-President of the Trades Union Congress.

Finally, and perhaps most vital and pressing of all, we must go forward resolutely and rapidly with the solution of the problem of the control of atomic energy. We cannot allow any nation to impede, by mere negative action, a system agreeable to the great body of nations. Surely, it is right to go ahead with the broad features of the American plan, and to set up a system of efficient control, and to leave always a chair ready at the table for Soviet Russia whenever she cares to associate herself with a system of examination and control which is obviously just and fair. But meanwhile, the power and authority of those states who are willing to conform should be built up and made irresistibly and overwhelmingly strong. I certainly do not regard the clash of East and West as inevitable; I do not believe it to be imminent. But if history, and especially recent history, teaches us anything, it is that a policy of weakness and appeasement is more dangerous than a policy of straightforwardness and firmness. In feebleness and uncertainty, and not in strength and resolution, lie the seeds of war.

To sum up, I feel that the Foreign Secretary, perhaps naturally, tended a little to minimise the sense of disappointment and disillusionment which result from the undoubted failure of the Moscow Conference. I felt that he did not sufficiently explain the urgency of the economic crisis in Germany and Central Europe generally. I thought he was unconscious of, or perhaps thought it better to cover over, the degree to which the actual administration of our zone in Germany has failed, partly from some intrinsic weakness in its organisation and partly from its thoroughly ineffective management from Whitehall in the last two years. I felt that he was unwilling to face the urgent need to develop a constructive policy to deal with the growing deterioration of the world situation. That is the pressing task of Ministers. On their success or failure—and, heaven knows, we wish them well; they have the good wishes of us all—will depend, not only their reputation in history, but the future of the British Commonwealth and Europe, for whose prosperity and happiness they have a supreme responsibility as the present advisers to the Crown.

3.8 p.m.

First of all, I should like to express my gratitude to hon. Members for the contributions they have made in this Debate. I must con- fess I was so engrossed in the speech of the right hon. Member for Bromley (Mr. H. Macmillan) that I did not recognise he had reached his peroration. Hence my reluctance to get up as quickly as I was expected to do. I realise that in this Debate we have a very great sense of responsibility owing to the situation that has developed since the war. But I still repeat what I said yesterday: At this moment I am neither pessimistic nor optimistic, and I think that is a right demeanour for a Foreign Secretary to adopt. I do not minimise the difficulties; but, as you know, I have been engaged for a good many years in difficult negotiations of all kinds, and I have never given up until the final break came. I have seen many 11th hour and 59th minute settlements. The probability is that if we keep our temper and our patience, as I have said before, we may in the end reconcile these differences. I assure the House and the country that that is the attitude I am going to adopt. If, finally, I have to say, "Well, it cannot be done," then His Majesty's Government, in the light of that situation, will have to review the whole of their policy.

We started out with a view to developing the consolidation primarily of the four Powers. I must confess, if I am pessimistic at all, it is about the device of the Council of Foreign Ministers that was developed at Potsdam. I think the conception was right; I think the design was right; but this perpetual veto was not, I think, in the mind of anybody, nor that the approach to the problem should be in that way. The other thing which is so disappointing, I think, as one hon. Member said yesterday, is the practice of first making a statement, whether it is right or wrong, and then reiterating it as though it were right. I do not think that other Powers can quite be expected to accept that as a basis for negotiation. Nor do I think—and this ran through the whole Debate—that it is right that if one has a friendly exchange of views in a conference without a final decision and a proper agreement, one should keep quoting that discussion as though agreement had been arrived at. One cannot negotiate on that basis at all.

If I may say so, before I come to answer the questions, there is another thing that has developed about which there may be great differences of opinion. I am a great believer, like everybody else, in the freedom of the Press. But I think there are limits. The original intention of the Council of Foreign Ministers was that it should be a negotiating body issuing communiques as it reached agreement.

I am glad my right hon. Friend, who was in the negotiations, agrees with me that that was the intention. Now it has gone beyond that, and one of our big handicaps in this instrument for making peace is that every word we say is reported to the Press. Not only that. I am sorry to say that this publicity reaches down now into the sub-committees, and even to the deputies.

It is one of our greatest handicaps. Everybody knows this who has been engaged in negotiations. I should like to make it clear at this point that I want no secret negotiations—no commitments in secret. But that is quite a different thing from considering at a table and exchanging views. I found in Moscow and in Paris, if I may use an old trade union phrase, that one cannot even "think aloud," or make a preliminary suggestion in order to draw the minds of one's colleagues today without its being hurled into headlines in the Press. That is one of our greatest handicaps in grappling with these technical things, when one really wants to elucidate the minds of one's colleagues, before coming to a final conclusion. I am not blaming the Soviet Government for that. It was largely due to the power of the United States Press that this complication has developed. Even the Press themselves say that, from the news point of view, this new thing that has developed is of little value. When one gets a very crucial position, upon which so much in the world depends, one wants to be able to have a frank exchange of views without commitments, in order really to ascertain each other's mind, without the glare of publicity which has gone on hitherto.

There are some things arising from the speech of the right hon. Member for Bromley to which I ought to call attention. For instance, the Tyrol was mentioned. He said he was glad that the two enemy states had arrived at this agreement without any assistance from anyone else, but that is not really correct, and I think he knows it. As a matter of fact, one of the pur- poses of my policy has been, apart from all the political difficulties that may arise, to encourage economic considerations, which transcend the difficulties of boundaries. When that Debate took place, I indicated that I could not say very much because I was promoting this idea at that moment. Both with the Foreign Secretary of Austria and with Mr. de Gasperi of Italy, I used what influence I could to promote this Tyrol agreement. What is more, in order to give it international status, I insisted upon it being written into the Italian Treaty.

I do not want it to be misunderstood what part the right hon. Gentleman played. It is true that he helped, but the agreement was not the result of the four Powers working together, but rather the opposite, because one Power made every possible difficulty. I do not want to detract from what the right hon. Gentleman has done.

That may be true. Let me make this clear. There are many things which cannot be done by the four Powers, because it is not the business of the four Powers. Let me give another illustration. I have been striving very hard to develop something which I regard to be of the greatest economic value to Europe, and that is a joint electricity board using the watersheds of the Alps, for different countries. I believe that if France, Switzerland, Yugoslavia, Italy and Austria could, in combination, develop electrical power for these territories, the economic and vested interests which would grow out of that would be of tremendous importance to those territories. There are many other things too, but I will not weary the House with them.

In regard to the United States and the fusion agreement, the right hon. Gentleman has apparently never heard of the appropriation committees of Congress. In all this business money plays some part, and it plays some part in carrying through this fusion agreement. I am speaking from memory, but I do not remember whether the appropriation has yet been carried. I had to arrange for us to carry the burden while the appropriations were going through, and I think the liability and risk we took under that head was very important, and helped to keep the fusion agreement going during the interim period. It is true that the agreement was signed, but the procedure of the Senate is rather different from the procedure in Parliament, as everyone knows.

The other thing that we must remember in regard to Europe is that it has to be handled very carefully. America is 3,000 miles away. It may well be that among the electorate of America there is one opinion on the coast, another in the Middle West, and yet another in other parts of the United States. I can appreciate the very great difficulty of the American Senators, in view of their traditions, in entering into these commitments, and in carrying the great electorate with them. It is not as easy as in a small country of this kind, with its Parliamentary and historical traditions. Whatever the right hon. Gentleman says now, they could not have done it three months ago. I am perfectly certain that the step which they have taken in the last month or two could not have been taken in early January. Therefore, the developments that are going on are quite different from what they were three, six or 12 months ago. The last election had a great influence in the acceptance of responsibility between the Republicans and Democrats on these matters.

Turning to the questions that have been asked, I know the anxiety of the House about making the fusion agreement in Germany a success. I can only say at this stage that I am in close consultation with the United States, with a view to improving that agreement, in order to make it work more effectively, and with a view to working out the details. But I regret that I am not in a position to say any more for the moment. When these details have been worked out, I will inform the House.

I am sorry to butt in, but when, yesterday, I offered the right hon. Gentleman congratulations, I thought that all was now agreed, and that all that was now required was to put the machinery in gear. It would appear that it is not quite as simple as that.

The point is that, from the point of view of getting the two zonal agencies set up, the administrative side has been worked out. But there is now another step to be taken in setting up and working out in detail the functions of the Economic Council, whose decisions will have the force of law in the economic field. I have already agreed the line of those details with General Robertson, who is now discussing them with General Clay, but the actual details themselves have still to be worked out. We passed these things through fairly quickly in Germany, but it is not quite like that in this matter. The details have, naturally, to be referred to the United States. The principle and the basis have been accepted, but the actual application has yet to be made. So far as finance and organisation are concerned, they have been agreed, but the powers of the new decree to be adopted have to be formulated in detail. I hope that is quite clear.

The other point raised by the right hon. Gentleman opposite was the question of the Saar. As he is aware, His Majesty's Government have always given their support, I may say their firm support, to the French claim to the area known as the "old Saar", that is to say, the Saar within the 1919 boundaries, but I share his doubts about the wisdom of an extension of the French claim to cover an agricultural area with a fairly dense German population. I do not, however, exclude the possibility of minor frontier adjustments to the 1919 boundaries, to take account of transport and similar considerations—there is a railway running to the South which is rather important. I sincerely hope that the French Government will not insist on claiming a permanent enlargement of the Saar to the extent foreshadowed by the provisional administrative arrangements which they have lately put into force. If they do, I am perfectly certain that it will delay a quick settlement of this problem. I speak as a friend; and I hope they will take this as a friendly consideration of the problem.

With regard to reparations, I have been asked what the present position is. It is affected by the new level of industry now being worked out under the Potsdam formula. The fixing of this new level of industry will affect plants in categories 2, 3 and 4. Category Z plants, as I said yesterday, will be dealt with immediately. I mean by that, in a word, that many works which would go into categories 2, 3 and 4 under the 7,500,000 tons per annum yardstick for steel, and would be marked and closed down for reparations, will, in view of the adjustment on a higher level, probably be taken out of reparations and left to the German economy.

Then, I was asked about Poland. The first question was, Were we going to put an end to the deportation of Germans from Poland to the British zone? When I was in Warsaw it was suggested to me by the Polish Foreign Secretary that we should take 50,000 more Germans into the British zone from Poland. The first consideration we have to give to this is that we cannot take any more, under any circumstances, which will give us—without being offensive—just mouths to feed, but no production. As far as the information given me to date goes, the position is that we have nearly filled our quota under the existing Control Council agreement, and any further intake must be determined in the light of a report which we agreed in Moscow should be made by the Control Council on the general question of population transfers affecting Germany. I must emphasise, however, that it is extremely difficult for us to agree to take any more.

With reference to the ratification of the Anglo-Polish Financial Agreement, we weighed the facts of the Polish situation in regard to trade and had talks about cultural relations, and indeed considered all the factors which are essential in putting our relationship on a better footing. I did not wish to prolong a situation which was damaging to the Polish people. I have taken the step on assurances given me by the Prime Minister of Poland, which I hope and trust will be justified in fact. The ratification of the financial agreement will assist the resumption of trade between Poland and this country and enable us, I hope at a very early date, to complete the negotiations for a trade agreement, and settle also the question of compensation for the internationally-owned industries which have been nationalised in that country. The settlement of this particular agreement, which will include supplies of food for this country, is of great importance to us.

I was asked about the Italian Colonies. The Council of Foreign Ministers agreed to establish a commission to visit the Italian Colonies. It should be in a position to start its work as soon as the Italian Treaty comes into force. In New York we agreed that upon ratification this commission should be set in being. Having entered into that agreement we must adhere to it and, accordingly, some weeks ago we invited the other Powers con- cerned to nominate their representatives to meet in London as soon as possible. They will be charged with the duty of setting up the commission and doing the other preliminary work. The United States and the French Governments have accepted this invitation, and I am now awaiting the Soviet reply.

On the question of the Senussi, His Majesty's Government in the past have expressed their sympathy with the aspirations of the Senussi for independence, and I made it clear that we are bound by the pledge, to which His Majesty's Government are a party, and which was given to the Senussi, not to return them to Italian rule. In the event of the Council of Foreign Ministers not being able to agree on a settlement within one year of the date of the ratification of the Italian Peace Treaty, the matter would be referred to the United Nations. In view of this agreement and decision I think it would be unwise for me to say any more at the moment.

I should like to express my gratitude for the number of thoughtful and constructive speeches we have had on the Far East. In particular may I say how impressed I was with the speeches of the hon. Member for Bury (Mr. W. Fletcher), the hon. Member for Norwich (Mr. Paton) and the hon. Member for South Croydon (Mr. Rees-Williams). They raised many important points in their speeches, and I shall try to answer them in the remarks I shall now make on Far Eastern problems generally.

First of all, it has been suggested that His Majesty's Government do not take sufficient interest in the Far East. On the contrary, we have set up a liaison mission in Japan, where the Prime Minister also has a personal representative. We have our representatives all over China and we are closely following the situation. In South East Asia we have set up the Special Commissioner's organisation, which is performing very valuable functions in the co-ordination of food and other matters.

May I say that about 18 months ago, we were faced with a situation in South East Asia and in a good deal of the Far East which, as I am sure the hon. Gentleman the Member for Bury will agree, looked as if a famine covering about five or six hundred million people was imminent. It was Great Britain, who took the initiative and established a very power- ful organisation at Singapore which faced such complicated difficulties as arranging shipments and getting rice out of Siam. That organisation saved what looked like being the most catastrophic thing in the history of the Far East at that time. It is true to say that without this organisation under Lord Killearn whole parts of the regions might have been affected by starvation. I admit, and I think everyone who has had anything to do with the Far East would admit, that the problem of introducing rationing, and a level rationing, well administered, in which we had to bring the ration down to four or five ounces a day, constituted a tremendous task for any Government to undertake. But, because famine did not happen, no one noticed. I invite hon. Members to study the work done by British administrators in the last 18 or 19 months in the Singapore organisation, which I think has saved us from a great catastrophe. It is a great tribute to British administration, which had to create the organisation out of nothing, and with very few officials to carry out the task.

The hon. Member for Bury also referred to the part we played in Indonesia to bring the parties there towards agreement. I think we can claim that our prompt action and expenditure saved millions of lives. Our people acted with great tact in this very difficult job, as the hon. Member said. An agreement was signed between the Dutch and the Indonesians on 25th March and it is now in force. Difficulties have arisen in regard to other matters such as finance, economy, currency, and representation in foreign countries. But I am glad to announce that the Dutch Prime Minister has gone out to Indonesia to help in reaching a settlement. I wish him and his colleagues well. I appreciate the difficulties that the Dutch are faced with, and I also understand the problems of the Indonesians. It would be wrong of me to make comments which would hinder these talks by the Dutch Prime Minister.

I have not published the agreement which I referred to in this country, but it was published by the Dutch Government and the substance was given here by the Press. In view of the interest shown in this Debate, I will undertake to circulate it to hon. Members. I only hope that these issues will be brought to a head very quickly and settlement effected. I feel that both parties should recognise the very great importance that Indonesia represents in assisting in the economic recovery of the world, particularly in regard to food and other commodities. I have taken every possible step open to me to encourage a settlement because His Majesty's Government realise that here is a contribution which the Dutch and Indonesians can make towards world recovery which is important not only for this area, but is even more important in getting the plantations working for next year. There is an assumption that there is a lot of stuff to be exported there now, but what we are very anxious about is that the territory should be brought back into cultivation and production for next year, because 1948 is going to be another very difficult year for the world. Therefore, the sooner a settlement is reached, the better.

Then the right hon. Member for Warwick and Leamington (Mr. Eden) referred to China. As regards our trade relations with the Chinese, we made approaches to the Chinese Government at the same time as the United States Government, but the Chinese postponed negotiations with us until they had settled with the United States. A counter draft has now been received from the Chinese Government, and is being urgently studied by all the Departments concerned, I think that the right hon. Gentleman knows the task imposed on the Foreign Office by those words "all those concerned." It is hoped that the negotiations will soon be completed. As regards the publication of the report of our Trade Commission to China, I will pursue the matter with my right hon. and learned Friend the President of the Board of Trade. The question was raised of British interests in the former International Settlement. The House is aware, and indeed the right hon. Gentleman said yesterday, that under the 1943 Treaty, acceptance of responsibility for these liabilities was undertaken by the Chinese Government. A liquidation committee has been established whose duty it is to determine these liabilities. Some progress has been made, but I agree that there has been a lot of delay. I hope that matters will be speeded up, and I give the House the undertaking that I will follow the matter up personally in a vigorous manner. In the meantime, these former employees are receiving from the British Government up to 40 a month per person, which we shall call upon the Chinese Government to settle in the final adjustment.

Another reference was made yesterday, I think by my hon. Friend the Member for Norwich, about our failure to appoint an agricultural attaché. We are all for exporting ideas, as hon. Members have suggested, but I assure my hon. Friend that it is a question of determining what we can do with our staff, and which is the best way to do it. With the interests we have all over the world, and with the demands made upon us for agricultural experts, we are short of such staff. We have many other calls in other parts of the world. But we are concerned with the labour conditions, and the first step we have taken in this connection has been the appointment of a labour attache to assist the social services, etc., which have been introduced into that country.

Questions were raised about Japan, and Members on both sides of the House have paid tribute to General MacArthur, which I am very happy to endorse. Everything may not be as we want it in Japan, but it is wrong to say that we do not make our voice heard. We do this both in Washington and Tokyo. Many of the questions which have been mentioned will in any case fall to be dealt with in the final peace settlement, in which we shall have full opportunity to make our opinions known and to submit our proposals. I was asked if I could give any further information about the settlement. I hope it may be possible to conclude an early peace treaty with Japan. The first step is to reach Allied agreement on the basis for the treaty. The efforts of the Government will be directed towards that end. We shall, of course, keep in close touch with the Commonwealth Governments in this matter. Australia and Canada particularly are very keenly interested in the peace treaty with Japan. As regards the textile trade—a matter, which was raised first, I believe, by the right hon. Member for Warwick and Leamington and also by my hon. Friend the Member for Norwich and others—an enactment on labour conditions was recently made in Japan, incorporating a wage plan and enforcing wage standards for the textile industry. This fair wage clause also covers the conditions of child labour, and will mean that children below the age of 15 will be with- held from the industry. That, I think, is a very important law so far as Japan is concerned and it will certainly have an effect.

I have also arranged to send a Labour attaché to Tokio in order that we may be advised on the steps that have been taken. But I would say this: we cannot save the Lancashire and Yorkshire textile trade by imposing restrictions on other countries. The Lancashire and Yorkshire textile trades must respond to the efforts of the Government to help them, or they will lose anyway. My point of view, both in my days at the Ministry of Labour and since, is that textile response in this country is not too encouraging. In view of the claims my hon. Friends opposite always make for private enterprise, this certainly is the great test, because the Government are actually handing it to them to assist private enterprise. It is up to the textile trade to respond or to demonstrate—

I do not think I or anybody mentioned restrictions in order to save the Lancashire or Yorkshire trade. What we had in mind were the very different conditions of hours and labour.

The right hon. Gentleman may say that it was not restrictions but, as I listened to the Debate, I thought there was an element of fear running through it that Lancashire could not stand up to it whatever the conditions were. I say that the Government are placing facilities at the disposal of trade in this country and it is up to the flexibility and energy and vigour on the part of the work people and the managements in that trade to respond, or nothing we can do—

So far as the organised workers in the textile industry are concerned, the only kind of unfair competition they want to be protected against is the too low standard of living in Japan.

I have given my answer, and I have had a good deal of experience. It is no good glossing over the thing. There is a stubborn mentality to progress in this industry and we cannot overcome it, I suggest, by refusing to develop and to go on—

I cannot give way. I have only 10 minutes left and I want to answer hon. Members. I have been asked a question about Korea. The hon. Member for South Croydon asked what the prospects were for a four-Power trusteeship in Korea. As a result of the exchange between Mr. Marshall and Mr. Molotov, it has now been agreed to resume on 20th May the meetings of the Joint Soviet-American Commission, the object of which is to establish a provisional government which will enable the setting up of a four-Power trusteeship. I will not weary the House with all the correspondence that is going on. I have not got time. That is the result of the exchange that has taken place.

With regard to the Middle East, first, I have been questioned in regard to the Sudan. I am glad that the right hon. Gentleman the Member for Warwick and Leamington paid tribute to Sir Hubert Huddleston. I should like to say that I fully agree with what he said. In reply to the points which he raised, I should like to say with emphasis that in all the negotiations with Egypt there has been, and will be, no attempt to appease the Egyptian Government at the expense of the Sudanese people. I offered a just settlement, but I never attempted to buy it because, as I have explained before in this House, it has been my endeavour to put the relationship between Egypt and Great Britain on a different and more modern level, on the basis of an alliance on an equal footing rather than that of occupation. As regards the Sudan, His Majesty's Government went as far as they could to try to meet both the Egyptian and the Sudanese positions. They can go no further. Whether they take this to the Security Council or anywhere else, we cannot go any further in the offer we have made.

The hon. and gallant Member for East Dorset (Colonel Wheatley) asked me why we did not withdraw troops immediately after the war ended. I would point out that this mass of troops and communications was put in to defend Egpyt in the Allied cause. This is a great transit area, and therefore the whole of the return of the British Commonwealth to a peacetime military footing was bound up very largely with this centre. We have been proceeding to limit the assembly of stores, equipment, etc., as fast as shipping would allow us, and we have had to have regard for the troops for whom we have had to find other places, other accommodation and buildings. I do not think it would be fair simply to close down and not provide alternative accommodation for our men. Sidky Pasha recognised the force of this at the time, and dates were fixed to meet this situation, but now that our proposals on this question of withdrawal have been rejected by Egypt, I must remind the House that we stand by the 1936 Treaty.

With regard to Transjordan, about which I was asked, I have not received a copy of this famous White Paper issued by the Transjordan Government but, when it is received. I will examine it and make it available. I will pass it to the right hon. Gentleman the Member for Warwick and Leamington, who is a great authority on Arabic languages, to translate it on behalf of the Foreign Office.

With regard to the Middle East generally, I have stated our policy in that area. It is vital to the British Commonwealth and it is vital to the peace of the world. There has been no change and, in spite of all that is said, we have the good will of the independent countries with which we are associated. There is a lot of lax talk about the Middle East, but I would remind the House and the country that throughout this great area, where we have influence, we are doing all that we can to contribute to the social development and the raising of the standard of life of the people. His Majesty's Government must maintain a continuing interest in the area, if only because our economic and financial interests in the Middle East are of vast importance to us and to other countries as well. I would like this faced quite squarely If these interests were lost to us, the effect on the life of this country would be a considerable reduction in the standard of living. Other parts of the world would suffer too. The British interests in the Middle East contribute substantially not only to the prosperity of the people there, but also to the wage packets of the workers in this country. Nor can we forget our old and valued friendships with the peoples of the area. I want to make this declaration from the Government's point of view and my own; I cannot be a party to an act or policy which would result in lowering the wages and purchasing power of Great Britain. Let those who want to do this be honest to their constituents and tell them what the effect of their ambitions would be on the pay packets of the people they represent

I was asked a question on defence namely, whether we had cut our defence commitments. I can see hon. Gentlemen opposite waiting with great interest to hear what the answer will be. So far as foreign policy is concerned, we have not altered our commitments in the slightest, but these commitments are in process of being worked out in the light of developments on the Peace Treaties, the terms of which entail a reduction in the claims on our manpower in the next couple of years. The Bill that is being discussed does not come into operation until 1949

Here I wish to say that His Majesty's Government do not accept the view submitted by the hon. Member for Devonport (Mr. Foot), that we have ceased to be a great Power, or the contention that we have ceased to play that role. We regard ourselves as one of the Powers most vital to the peace of the world, and we still have our historic part to play. The very fact that we have fought so hard for liberty, and paid such a price, warrants our retaining this position; and, indeed, it places a duty upon us to continue to retain it. I am not aware of any suggestion. seriously advanced, that, by a sudden stroke of fate, as it were, we have overnight ceased to be a great Power. I know our difficulties. But, looking round the world, and, I hope, making an impartial examination of what is going on, I am pleased with the speed at which we have converted this country back to peacetime production. I am really proud of the part we are playing, and I say we have nothing to apologise for considering, as I have already said, that we have been mobilised one day in three for the last 30 years. The progress we have made in the last two years is a worthy contribution to the recovery of the world from the second world war. I must say, it has never occurred to His Majesty's Government, nor, I believe, to the British people, to apply for a receiving order in bankruptcy

Some people have said that this has been a depressing Debate. I can only say what I said at the outset. It is useless to be optimistic, and to mislead people; it is worse to tell them that we have given up hope. In Moscow we tried to do everything we could to find a practical solution of the problems which face us. I have seen many comparisons made with the speed of previous conferences and the speed with which peace settlements have been made hitherto. I do not remember, and I do not think the greatest historians can ever remember, a world war like the second world war. I sometimes look at the papers and prints of my predecessor, and see what a happy man he must have been in those grand old days. Today, I have economic troubles to deal with as well as political ones. It was only political troubles in those days. Economics, culture, and everything else are involved in the discussions going on at the present moment.

Other questions arose during the Debate, with which I have not time to deal. I undertake to write to hon. Members on the points they mentioned, and to give the answers that they would have expected orally. All the Debate will be carefully studied. With regard to the Far East, my last word is that if hon. Members who are interested in that great area care to see me at any time to discuss this tremendous problem, I shall be happy to consult with them, take their advice, and do what I can to promote British interests and British culture in that great area.

3.59 p.m.

The right hon. Gentleman said that at the 59th minute of the 11th hour funny things were apt to happen. I did not think I was going to get into this Debate. I now say to the right hon. Gentleman, that he has delivered a very characteristic speech this afternoon: massive, long, impressive, solid, resolute, unimaginative, and, on the whole, entirely unconstructive. He said he had nothing to apologise for. In the 30 seconds which remain to me, I wish to say that I think there is one thing we have to apologise for, and that is the gross maladministration over the last two years, despite repeated warnings from both sides of this House, of the British zone in Germany. There is no need—

It being Four o'Clock the Motion for the Adjournment of the House lapsed. without Question put.

Public Accounts

Mr. Lever discharged from the Committee of Public Accounts and Mr. McAdam added.—[ Mr. Michael Stewart.]

Manpower (Insurance Agents)

Motion made, and Question proposed, That this House do now adjourn."— [ Mr. Michael Stewart.]

4.1 p.m.

The concluding speech of the hon. Member for East Aberdeen (Mr. Boothby) in the Debate which has just ended was, indeed, almost an all-time record. He set an example of exactitude in time, and I will endeavour to be equally exact in the facts I wish to present to the House in respect of the insurance industry. I say at once, that I refer to industrial insurance. This industry is one of the greatest in the country. It employs, at a rough computation, something like 65.000 men as an outdoor staff, agents who are loyal, who are, on the whole, extremely efficient, and who are skilled in their work. It has been stated in connection with this industry that in 1942 there were over 90 million paying policies in existence, and that £77 million per annum was collected in premiums. Today, the figures are considerably in excess of that.

There has been a great deal of perturbation and anxiety lately in the breasts of these agents in regard to the manpower position. It will be remembered that in the Government White Paper, the Economic Survey of 1947, the Prime Minister made a spirited appeal to the nation to conserve manpower as far as possible, and to direct it into those industries which were most essential to the nation. In that spirit, the insurance agents, through their unions and organisations, co-operated to the full. But now we find that certain offices are taking advantage of the position in starting what are known as spare-time or part-time agencies, using men who have possibly had no previous experience of the business, no doubt with a view, because of the great increase in industrial insurance, of employing these men in a drive for a further increase and, incidentally, further profits.

The stand taken up by the unions, and my own union in particular, is that there should be no recruitment for new labour at all, because we contend that the existing outdoor staff is adequately and sufficiently skilled and able to deal with the existing business. Only a few weeks ago, I put a Question to the Minister of Labour in connection with the Co-operative Insurance Society. Here we are in a difficult position, because the C.I.S., which, after all, is associated with the Labour Movement through the Co-operative Movement, should normally have set a good example to the industry. The difficulty there has been that they have been starting on blank books. In other words, they have been recruiting from the already reduced stock of labour for the purpose of increasing their collectable debts. Recently this practice has been stopped. The Chairman of the C.I.S. in a recent speech spoke of the record of phenomenal progress which the Society made in 1946. Yet in the Government's survey of 1947, in paragraph 124, we read that the prospective force of 18,300,000 labour power is falling substantially short of what is needed to reach national objectives. The Government, therefore, appeal to workers, in this case women, to enter industry and to augment that number.

In spite of that appeal, and in spite of protests by the unions, what do we find? I have before me some facts which are very enlightening. In the C.I.S., Hammersmith district, a £28 book—that means a book which collects £28 weekly—is split into two books of £14 each; and, therefore, the minimum wage is only That minimum wage does not mean merely the collecting of a £14 book. It includes ordinary branch insurance, and special branch and general branch. From that £4 which the agent receives, if he is on the minimum, there are deducted loan repayments he has undertaken as a result of purchase of the book, health insurance and superannuation. So we have the position that those offices which should have set a good example to the whole of industry are, in certain cases, starting men, not only on split-up books, but by paying them rates of remuneration which we consider entirely inadequate. I have a letter written by Mr. Frank Crump, of the National Amalgamated Union of Life Assurance Workers, in which he complains to the manager of the Co-operative Insurance Society that they are opening up new offices in certain outlying districts of London. He referred to the fact that the Royal London and the Liverpool Victoria, by contrast, are closing many offices, which is evidence, he declares, that progress is not necessarily dependent on an increase in the number of district offices. So he considers the action of the C.I.S. all the more regrettable, and adds his strong protest, and he stated his intention of raising the matter in trade union and co-operative circles. All that is certainly anti-social, and is opposed to the spirit of the Government's policy.

One of the difficulties with which we have to contend in the insurance industry is the fact that there is an excessive number of insurance undertakings. There is fierce competition in the business. In the 28th annual report of the Insurance Unemployment Board we were told that in 1939—I have not comparable figures for today, and they may be less—there were 352 ordinary life offices and general insurance companies; there were 50 industrial companies and friendly societies; 299 separate employers societies, according to Lloyds; 434 friendly societies, and miscellaneous organisations a total of 1,887 separate employers making returns. We contend that that is an excessive number of organisations catering for insurance, and that it is an excessive drain upon manpower. When we come to spare and part-time agents we come to a very difficult position. They work on prospects, and they draw commission for their prospects, and leave the real service to other people to do—the clerical work and the service connected with the business. It has been computed—no one can get an accurate figure—that hundreds of thousands of people are engaged as spare-time and part-time agents. We contend that the existing staff is more than able to deal with the business, because of their special aptitude; and that it is our imperative duty to economise on manpower today, in view of the urgent need of the nation, and in view of the call made insistently by the Government that all available manpower should be kept for purposes which are directed to the national need. Of this insurance business let me say, that it is a very important industry.

It encourages thrift, and the Kennet Committee very rightly paid a compliment to them in 1942. They stated that thrift was to be encouraged, and that because people put by large sums of money in securities of one kind or another they thus saved the country from inflation. Thrift should certainly be encouraged, and to that end it is desirable that this industry should continue

What agents complain about is the large number of people, without previous experience, being used by certain offices for ulterior purposes, to force down the standard of living of the workers. The Prudential does over one-third of the insurance business in this country. They built this vast business over the bodies of thousands of workers who were often dismissed unceremoniously when they failed to get the necessary increases. Until recently the Prudential would not encourage new entrants over the age of 25, because they wanted to get them young to train them to get all the possible business they could. It is partly for this reason that they have obtained their present success.

I will mention one particular instance which occurred to me, which I repeat with regret. As an agent of the Liver Friendly Society, I found myself shortly before the war in Scotland at the annual delegate meeting with a sandwich board on my back protesting against the employment of part-time and spare-time agents, averaging 15s. 6d. a week. For that deed I paid a heavy price. It is true that the committee of management did not deal with me then as they would have liked but later on they trumped up some charge of writing an article in a trade union journal which they all said was derogatory to the good name of the committee, suggesting that they had no brains and ability with which to carry on their business. They sacked me, and I am glad to know that these were the circumstances in which I got my dismissal. As far as I know, I became the first Member to enter this House with an unemployment paper in my hand, no doubt because of my action in fighting against spare-time and part-time agents. The Royal Liver Friendly Society, although they should have set a better example, have permitted this practice for a number of years.

I have a letter here which is a disgrace and a scandal, which will touch the heart of my hon. Friend who has fought as a trade unionist the whole of his life. It concerns a fellow countryman of his, Mr. T. G. Davies, of Llanelly. He is an ex- miner who suffers from pneumoconiosis, which I understand is another name for silicosis. He went into the industry as an agent, and he was recently dismissed by the Refuge Assurance Company. He was dismissed in spite of the manpower position of the country. He served the company well for three years and had been declared medically fit by a qualified practitioner and should normally be able to carry on as an insurance agent for perhaps 15 years. This man is being displaced, not because his book is required for a returning ex-Serviceman, to which we would have no objection, but with the intention of employing a new agent drawn from the very restricted labour market. I contend that there are many cases where a man may not be fit enough to carry on as a miner, and in the more hazardous and physical occupations but, nevertheless, could very well become a good insurance agent, and be fit enough to carry on that job. It is very wrong to call upon the restricted manpower in order to enable the insurance offices unduly to expand their business and make further profits as a result.

The Refuge Company had the audacity to do what I think is a monstrous thing. When a delegate was recently appointed to the annual conference in Blackpool of my own union, they refused him permission to attend for a couple of days. This was because they are fundamentally opposed to trade unionism, unless they can get a milk-and-water union of their own type which will carry out their wishes. I trust That my hon. Friend the Parliamentary Secretary will appreciate that I am doing everything possible to assist him, and his Department in particular, in conserving manpower. Paragraph 127 of the Economic Survey says:
"Consumer services…are tending to attract too much of the manpower that is becoming available as the result of demobilisation, and it is of the utmost importance that only moderate increases should occur in those services in the immediate future."
If that is so, then we have a very good case, and it would be wise for the Government, through its spokesmen, and particularly through the spokesmen of the Ministry of Labour, categorically and clearly to state this afternoon that they do not favour this particular type of recruitment.

Finally, I wish to make one reference to the Kennett Committee of 1942. This Committee said that no persons, however designated, should be employed wholly or principally in canvassing for new business. We object to this wastage of manpower. We say that we want to build up the books of the agents to a reasonable size, without overloading. The agents themselves should by discussions, with the offices, be able to build up the books in order to provide a minimum wage of £5 a week, which we regard as the lowest possible figure consistent with a decent standard of life. We are willing to back them in doing that. We are fighting on the true principles of trade unionism. We do not want this industry to be abused and brutalised. In the case of the London and Manchester Insurance Company—one of the worst and most reactionary offices—the minimum wage is £3 10s. a week. We believe that a £5 minimum is the irreducible minimum which should be given to the workers. It is because of these conditions that I raise my voice in protest against the action of some of the offices, and I hope that the Minister of Labour will do everything possible to support the justifiable case which I have been making on the workers' account.

4.18 p.m

I appreciate the enthusiasm of the hon. Member for Newcastle-under-Lyme (Mr. Mack), but I am afraid that it has rather carried him away to make the most fanciful allegations about the industrial insurance companies who, as he must know, are co-operating magnificently—

—to assist the Government to make the National Insurance Act the success we all wish it to be. Let me congratulate the Government on the Commonwealth Conference which is now taking place, and which is to make national insurance reciprocal. I would like to give the House one or two figures so as to correct the extraordinary impression which the hon. Member has just given us. He spoke about the outdoor staffs having been increased beyond all measure. Let us take the Pearl Insurance Company, for example. In 1939, its outdoor staff amounted to 10,258 and, in 1946, it was 7,666. At the same time, every man on this reduced staff is collecting far more, is doing far more work, than his predecessor before the war. In 1939 the total collection per man per week was £23 2s., and now it is £43 7s. Let me give similar figures for the Royal London Mutual. In 1939 the staff was 8,205, now it is 6,517, and once again the services rendered by each man have greatly increased. In 1939 the total collection was £15 7s. —

No, I am not giving way. In 1939 the total weekly collection was £15 7s., and now it is £30 12S. It is the same with the Prudential to which the hon. Gentleman referred. The collection has increased per man from about £39 to £51. The Prudential Approved Societies have engaged 561 people in Torquay. What to do? To deal with work for the Ministry of National Insurance in connection with the new Act. It is the same with the National Amalgamated Approved Society, which has engaged 500 people—and, I may say, out of 2,700 applicants, of whom only 5 per cent. or less were in work. This is in order to copy out the records needed by the Ministry of National Insurance. My last word, as the Parliamentary Secretary wants to reply, is this. The hon. Gentleman opposite referred to the personnel engaged in this work, and I happen to know that in its staff at Torquay the Prudential employs over three times the statutory number of disabled persons—it employs something like II per cent. I should like to say more, but I will make room for the Parliamentary Secretary.

4.23 p.m.

It is rather a pity that my hon. Friend the Member for Newcastle-under-Lyme (Mr. Mack) wandered away from the matter which was really set down for discussion on this Adjournment Debate. His purpose, I understood, was to deal with the deployment of manpower, and he was bringing a general charge that the insurance industry was absorbing a far greater proportion of our very scarce manpower than it should be. He went on to discuss the introduction of the blank book arrangement with regard to a number of companies. In general, the insurance companies are helping us in picking up the surplus money. It is an anti-inflationary movement and one must give credit to them—

—for the way in which they are helping the Government in these very difficult days. That, however, is not an unmixed blessing. As to the general principle of life insurance residing in the hands of private profit companies, that is another matter, which of course we have not time to discuss today.

I would like to give the House an indication of what the real figures are. In 1939 the number engaged in the industry was roughly 123,000. In 1943 it was 129,000, in 1944 121,000, in 1945, 117,000, and in 1946, 135,000. In the general manpower situation, that is a dangerous tendency. The more people we have on production in proportion to those engaged in distribution and in services, the richer will this country be, and the higher will be our standard of living.

I am sure the Parliamentary Secretary appreciates that the outdoor workers I mentioned are paying National Health benefits and doing other work that has to be done by somebody to maintain a foundation for the National Insurance Act?

I quite appreciate that numbers of these men may be engaged in services connected with the Ministry of National Insurance as has been suggested by the hon. Member for St. Ives (Mr. Beechman), but I can assure him that in the figure for 1946 not so many of them are included. There are some, but it is well to remember that in 1946 there were not so many as there are today. I have not the up-to-date figures, but the Ministry has built up a labour force since in consequence of legislation passed by this House. I come now to the point of complaints in connection with the methods of certain insurance companies. I much deplore this tendency to put men on the streets with a blank book, but I must ask my hon. Friend to realise that the protection of the people engaged in the insurance industry is a matter for their organisation. We will never get anywhere in industrial relationships by bringing disputes on to the Floor of this House which ought to be hammered out between the employers and the employees.

Unfortunately we cannot do that, because we are not recognised as a trade union by this particular company.

That is a matter which cannot be settled on the Floor of this House. It must be settled within the industries. Other industries have had to do it and this House cannot put down a carpet to enable those engaged in the insurance world to get ordinary recognition. We should give them all the assistance that we can. There is in the Ministry an industrial relations department and any assistance that the Ministry can give in dealing with this matter if invited by the unions will be given. As an old industrial fighter I deprecate bringing on to the Floor of the House of Commons matters which ought to be settled in the board rooms and in the negotiating chambers, between both sides of the industry. We will never get anywhere by that method, and we must settle our problems in the normal way.

I come to the question of the undue proportion of manpower that this industry appears to be absorbing. I have been asked by my hon. Friend to take steps to stop it. That is asking either for control of labour or for direction of labour, against which this House has set its face. We are no more entitled to stop a man securing employment in the insurance industry than we can stop a man taking employment with the dogs or with the horses. It may be that in the urgency of discharging some of the social tasks which lie before us we may be led to the conclusion that some methods may have to be devised whereby we can correct the employment of our manpower so that first things shall be done first and men shall be placed in the most urgent places. So far we have not envisaged that situation, and I cannot say anything more about it.

I deplore this pitching of men on to the streets with a blank book and saying to them, "Get your living the best way you can." However, I say that the correct steps towards the prevention of that does not rest with the House but with the organised workers in that industry, and to the extent that this House does the work of the unions to that extent do we weaken the power of the unions and render them unfit to do their job. It is a difficult job and they must get all the encouragement that we can give them. I am alive to what was said in the Kennet Committee's report. I have read it and I realise that insurance is a valuable addition to the national life. We want to encourage that in the interests of the nation but not in the interest of any particular company or individual. Having said these things I hope my hon. Friend will be satisfied that his time spent this afternoon has been worth while.

Question put, and agreed to.

Adjourned accordingly at twenty-nine minutes to Five o'Clock.