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Ministry Of Food (Potato Accounts)

Volume 462: debated on Friday 11 March 1949

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

4.14 p.m.

The question which I have to raise this afternoon is one which may be a long way divorced from spelling reform, but at least I hope that the Parliamentary Secretary will be able to dot the i's and cross the t's of the problem I wish to put before her this afternoon. On 23rd February I asked her a question about section trade advisers, but the hon. Lady chose to reject my proposals for an inquiry into their operations. When I asked a supplementary about them, she rather inferred that I was trying to insinuate that section trade officers had abused their powers. What I am trying to get from the right hon. Lady tonight is an uncovering of a good deal of secrecy, and a much more equitable situation than exists at the moment, and, third, a far more accurate situation so far as statistics are concerned in her Ministry.

First I want to clear up this misunderstanding, that, I think, must arise, on the question of section trade advisers. If I had any reason for coming to this House and saying that I knew of specific instances where section trade advisers had abused their powers. I should take action accordingly; but in this particular instance I have no definite evidence whatever that section trade advisers, in my constituency, anyway, have abused their powers. I have had complaints. Of course, one has complaints. There is, however, a world of difference between complaints and substantiated cases, and I am not tonight trying to insinuate in any way that section trade advisers in my constituency have abused their powers. What I am trying to say, however, is that the system of section trade advisers does inevitably lead to the gravitation of business towards section trade advisers whether they like it or not. I also want to point out that the section trade advisers system does put upon individuals an immense power of selection of agents. For that reason it is very important that we should make quite sure that the system is as good as it can be made.

I should like to give one example of how business gravitates towards section trade advisers. Let us suppose that there is a village where there is no Ministry agent. There are many such villages in fact. There may be a private merchant, but he is not appointed an agent of the Ministry. Let us suppose that a farmer is unable to dispose of the whole of his crop to the merchant in the village. Therefore, he has to offer it in the end to the Ministry under guarantee. The area supervisor will tell the section trade adviser and the section trade adviser will appoint a Ministry agent. Very often the section trade adviser will appoint himself, because nearly all section trade advisers—I think all, in fact—are Ministry agents as well. This alone tends to make business gravitate towards the section trade advisers, whether they like it or not. Obviously, most of them do like it. They are not to be blamed for liking it, and I am not criticising them for taking the potatoes themselves very often. What I am saying is that the system inevitably leads to the gravitation of business towards the section trade advisers.

Let me give a specific example of this power of selection. I am prepared to give the right hon. Lady full details so that she can trace this particular case if she wants to, but I will give them to her afterwards, because I do not think it is fair to state them here now. I know of a case where 1,000 tons best sample silt land Majestic potatoes were to be loaded quite recently, and consigned to the Royal Albert Dock. If everything had gone as it should have gone, each loading agent would have had to load four trucks of those potatoes. We know that, in fact, one of those agents loaded 30 trucks. Obviously, some selection was adopted there. This system does seem to me to put into the hands of section trade advisers an enormous power to select the agents to be employed.

As I understand it, the present situation is based on the arrangements which originally came in at the outbreak of the war. There was an assurance given to merchants then that the area committees were to be guided by the terms of the merchants' business between the dates 1st July, 1938 and 31st May, 1939. That sounds very well, and in many areas, I dare say, that system has worked. However, as I am sure the right hon. Lady knows, there may be in some areas cases where the local growers do not sell to local merchants. In such a case the merchants who came into the scheme when the scheme was put into operation are not able to deal with the local growers.

Therefore, new methods had to come in. There was no precedent for them and no datum period on which to base them. Similarly, in times of emergency, the Ministry of Food often had to give an immediate demand to a particular area to produce so many tons of potatoes, and the section trade adviser was on the horns of a dilemma as to whether or not to hold up the order, in order to keep to strict rotation according to the datum period, or to give immediate delivery and get off the datum period basis. It is obvious that immediate delivery overrode everything else during the war.

I am asking the right hon. Lady to bear in mind that all this took place 10 years ago. Obviously, conditions have changed very considerably since then. I ask her: Is the datum period still abided by in the majority of areas, and, if not, why; and does she really feel that it is quite fair to pre-war merchants that the system should be allowed to drift on, getting more and more unbalanced, when compared with the pre-war situation? I think that it is important we should know what is the average increase of business in potatoes in each area, how many merchants there are, and how many of those merchants in each area are Ministry agents. I think that I have already asked her whether all section trade officers are agents. I am nearly certain that they are, but I should like that to be confirmed.

We now come to the matter of remuneration of section trade advisers. I believe that when the Ministry call on private individuals to do a job for them, it is much better that the Ministry should pay them properly and then put on safeguards to see that there is no abuse of their powers, rather than that there should be a lax discipline and poor payment by the Ministry. I believe that the rate of remuneration for section trade officers is 2d. a ton plus £500 a year. I am not sure that that is sufficient inducement to them to do the job as best they may with absolute scrupulous regularity.

I know myself that many of them—and the right hon. Lady was perfectly justified in saying it in reply to a question of mine a few weeks ago—have in the vast majority of cases prevented us from making the same mistake during the Second World War as was made during the First World War. It was quite right that we should have that datum period and if only it had been possible to abide by that, I think all would have been well. As to choice of appointment of section trade officers, we must have, first, a person who is willing to be one —not always easy to find—and he must have been in the potato trade for a long period, have very high integrity, and not be directly involved in potato collection or distribution, and be able to keep in touch with modern trends. I suggest to the right hon. Lady that if she wants to get an ideal individual She should arrange for the nationalisation of heaven and St. Michael and all his angels to help her, because I see no other way of getting that individual.

He does not know anything about potatoes.

She will agree, I am sure, that it is extremely difficult to get the ideal person, and that this does depend upon getting the nearest to the ideal person, if available and ready to serve. I believe that her tribute to them as a body of men during the war was justified. They have done good work, and I believe that the majority of them are still doing so. The power which they have is very great indeed over their fellow merchants. It is always difficult for individuals to accept supervision from someone who was formerly their colleague, and, therefore, she must not think that because she has not had complaints from merchants there are no complaints. Many of these merchants find it difficult for them to complain to the Minister of Food because of the position they are in vis-a-vis the section trade advisers. I hope the right hon. Lady will be able to answer some of those questions, and reassure me on those points.

I turn now to the 1941 ledger balances, about which I have asked Questions in the House. The 1941 ledger balances of merchants are not yet settled by the Ministry of Food, the reason given being that there was a fire at the Ministry. I know there was a fire at the Clarendon Hotel in Oxford in the early years of the war, which must have caused considerable dislocation of the Ministry's accounting system; but I ask the right hon. lady to remember that when London tradesmen were bombed out during the war it did not take them very long to discover the exact amounts owed to them.

I think that there must be some other reason than the fire, and according to my information it is this. During the war a new system of accountancy was introduced into the Ministry—the Hollerith system. So far as many merchants are concerned, that system became a hollow myth, because many merchants who were sent payments by the Ministry for potatoes they were supposed to have provided hotly denied that they had ever provided the potatoes, and asserted that they were not entitled to any payment, but the Ministry said that they must keep the payment. In one case the Ministry demanded £2,000 off a merchant, and after inquiries were made it was found that the Ministry itself owed the merchant £300. Obviously something went very wrong with the Hollerith system, probably due to peculiar difficulties during the war and inexperience. The fact remains that eventually the system was sorted out.

The Parliamentary Secretary told me in an answer that there are 19,000 cases left to deal with, and I now ask her whether she does not think the time has come to cut these losses, because according to the information she gave me the other day it has cost £100 per official who visited the Isle of Ely alone to try to sort out these accounts, and they are not sorted out yet. She said that 20 officials came, and that it cost £2,000. I dread to think what it costs for the whole country. I hope she will be able to tell us that today.

All this happened a long time ago, and it ought to have been settled a long time ago; if it is not settled the Ministry ought to cut their losses. How much money has been paid out by the Ministry in settlement of these balances, and how much has this process of collecting the necessary information and making payments cost? What is the estimate of the outstanding debits and credits? The total sums involved must be known. Subject to their being reasonable, and somewhere near balancing, I should say that it would be much better now for the Ministry to cut their losses.

Is it the fact that British Railways have destroyed their records of potato deliveries for these years? I understand that the Ministry will not depart from the present system, whereby it will only end its interest in any particular deal when delivery can be proved. The only way delivery can be proved is by obtaining the records of them from the railways. Is the right hon. Lady going to waive that in this instance, or is she going to make settlement depend upon whether or not those records are available?

What is the situation under the Limitation Act, 1939. As I understand it, normally that Act forbids action being taken more than a year later; but under Section 20 there are occasions when action can be taken up to a maximum period of six years after, if there has been special cause for delay or if mistakes have been made. What is the position of the Ministry under that? I believe that the Ministry have an obligation towards merchants and agents to see that there is no unfairness, or escaping the law of the land. If, after inquiry, the Ministry's estimate is unacceptable to a merchant, will the Ministry take the merchant to court? Similarly, can the Ministry be taken to court, through one of its officers, by one of its agents or one of the merchants? I believe that some section trade advisers have accounts covering this period, completely separate from the Ministry's accounts. I believe that if the right hon. Lady were to ask her trade advisers to let her have the accounts, they would gladly do so, so that the matter could be cleared up in that way. Where the matter cannot be cleared up, I suggest that the losses should be cut.

Then there is the question of accuracy. The Minister told us that there is to be a loss of £10 million this year on potatoes. I believe that that is an inaccurate estimate, and I will try to show why. I am not saying that it was an entirely avoidable loss—that is not the point—because we have many reasons, particularly in my part of England, to be grateful for the fact that there is a guaranteed price. Nevertheless, the Ministry have estimated this £10 million loss. I believe it is far higher. The right hon. Lady told me last Monday that 300,000 tons of potatoes are to be processed in factories, and turned into dried potatoes. On the basis of the figure which she gave me, I worked out that these 300,000 tons will produce 55,400 tons of dried potatoes. They will sell, I think, at about £14 a ton, and that will bring in £775,600. The price paid for the 300,000 tons of potatoes, according to an answer which the Minister gave to my hon. and gallant Friend the Member for Ludlow (Lieut.-Colonel Corbett) recently, works out at £9 a ton all in, including the cost of processing and rail travel. That makes a net loss of £1,324,400.

In addition, 514,000 tons have already been sold, presumably at about £7 per ton, for stock feeding. The right hon. Lady agreed last Monday that there was a 5 million ton surplus, and I presume that that was based on the estimated tonnage in the clamps at the time of inspection, and not at the end of the season. In other words, the value at the time of first inspection is about £7 per ton, at a conservative estimate. That means £35 million involved there. We must estimate that some of these potatoes will be sold. Let us assume they will all be sold, although I do not think they will, as many will be rotten before they are collected. But let us suppose that they are sold for £4 per ton. The net trading loss will be £15 million. I believe that the loss will be even greater owing to late loading, about which I shall have to take the right hon. Lady to task some other day. The fact remains that the total loss under these headings, plus the loss on imported potatoes amounting to £1,500,000, with the extra cost of £500,000, will be over £20 million.

I am not complaining that that is the Ministry's fault entirely, but they have made mistakes over exports and imports. At present, we are processing Irish potatoes, brought in at £11 per ton. That is iniquitous; we are losing £5 per ton on them. I ask the right hon. Lady to be open about this matter. Let us have accuracy, equity and far less secrecy. I believe that if she had an inquiry into trade advisers, and exposed all the facts, we should find that everybody would be far happier and that there would be far less grumbling behind the scenes. Let the right hon. Lady remember that justice was not only blind but that she carried the sword of truth and a balance in her hand. The right hon. Lady must maintain that balance; she must aim to tell the people all the truth. At the moment she is telling the people only half the truth. I hope she will always remember thatjustice is strictly impartial.

4.35 p.m.

This is the first time that I have been lectured in this House and charged with not telling the truth. The hon. and gallant Member has in his own eyes been honest in his condemnation of me, and I am sure that he will not mind if I do not pull my punches. What I say now would not have been said had he not charged me in his last few remarks with being dishonest. He knows as well as I do that during the last few weeks he has put down Questions week after week and I have stood here and answered them. He knows that every time he has written to my Ministry, every time he has approached my Secretary or anyone in my Department, he has been given facts and figures. Whether he considers them accurate or not is for him to say, but on no occasion on which he has approached us have we tried to evade anything.

He has put Questions in this House, and I have tried to deal with him as kindly as possible, as the House has been full, but on many occasions I have had a weapon which I could have used ruthlessly, because many of his supplementary questions have been completely incoherent. On one occasion the information he gave in a Question was pure nonsense. In order to help him I invited him to meet me outside. He remembers the repercussions in this House. the joke and so on.

Last week, when I answered a Question which the hon. and gallant Member put down on consumer subsidies—I observe that he has not mentioned that today—I said that those subsidies ended in 1947. He then said, "Ah, but you are thinking of restoring them." I said, I could assure him not dishonestly but with complete honesty, that we were not, or words to that effect. The hon. and gallant Member then jumped up and said, "Why are you having documents printed?" The information which the hon. and gallant Member had was garnered from where I do not know, although I suspect that it was from some disgruntled person serving in my Department. When he asserted that we were having forms printed, again in order to save him, for I could have shown the House that he was completely incorrect, for such facts as he presented were complete nonsense, I asked him if he would produce the form. I have waited patiently for him to go to his informant and to produce the form. No form has been forthcoming, for the simple reason that we have no intention of restoring the subsidy.

That is so. No form has been printed, but the hon. and gallant Member stands up in the House and challenges me as though I am trying to evade something, and says: "Why are you having forms printed?" I made an inquiry this morning and can state that no form has been printed for 18 months or two years, since the subsidy ended.

It is not for the hon. and gallant Member to say that I am dishonest. I absolutely refute the charge. We in the Ministry of Food have nothing to hide. When things go wrong we are prepared to come here and say so. When any Member of this House asks for a figure, an interview or to see an official. no obstacle is put in his or her way. Therefore, I resent this allegation of the hon. and gallant Member. I say that far from my being dishonest the fact is that he has an informant who week after week is coming to him with this garbled story—a man who has not even half knowledge or quarter knowledge. I can quote instances drawn from the last few weeks.

So far as the position of the accounts is concerned, I agree that there were some difficulties in 1940 and 1941, but I should like to put it on record that since 1945 there has been no difficulty with accounts. There have been no arrears whatever during the last four years, but it has been necessary for us to examine the accounts of the 1940–41 period.

The hon. and gallant Gentleman suggests that the accounting system was at fault. Actually, the Hollerith system came into being after this period—another mistake of his informant. Therefore, the fault cannot be attributed to that system. During that period, 1940–41, there was a great shortage of accountants. I suppose it was the most difficult period of the war. I attribute the difficulties in the main to that shortage. There was a fire at Oxford, certainly, and about half the accounts for 1940 were destroyed, but the accounts with which the hon. and gallant Gentleman is concerned, and with which I am concerned, are the 1941 accounts. A large number of them were destroyed, but not as many as of the 1940 accounts. Of course, that did complicate matters, because we lost them. So during this time we have not only had to keep up the current accounts but we have had to investigate those 19,000 accounts, which I mentioned in the House last week. We have to examine the growers' accounts and, of course, the merchants' accounts.

I have here the figures which relate to the Isle of Ely. I can assure the hon. and gallant Gentleman that these are authentic. I am not evading my responsibilities in any matter. The balances investigated amount to £87,000. The cash collected—these, by the way, are 60 merchants' accounts which we have examined in the hon. and gallant Gentleman's area—is £30,000. The debts written off are £3,000, the balances on account investigated but not yet finally cleared are £12,000. We still have 32 merchants' accounts to examine. The total debit we estimate at £53,000 and the total credit at £8,000. The hon. and gallant Gentleman comes to this House and suggests that we should stop our investigations. If he were representing some defaulting merchants in this House, I could quite understand his demand but he is not doing that. He is here representing his honest constituents, and I say that as a representative of his honest constituents he is not doing his duty, because this is taxpayers' money. Does he expect my officials to sit back and let these defaulters get away with thousands of pounds? We certainly refuse to do that. We are going on examining these things and we are going on calling upon these people who have failed to pay their debts to pay the Ministry even at this late hour.

The hon. and gallant Gentleman said quite clearly that it must stop. I say that he is not representing his constituents honestly if he still continues to demand that. The hon. and gallant Gentleman has left me very little time. So far as a section trade adviser is concerned, he is the principal of a potato merchanting firm. We chose these advisers very carefully during a time when my Ministry was concerned with a large volume of potato business. We had to choose men who we felt would command respect in the area, men of the highest integrity who knew the potato world. We had to choose a man who particularly knew the conditions of the hon. Gentleman's area, which is a very fine potato growing part of the country. Those men, who are interested in potatoes, and have done well in their business could best advise us.

The Question having been proposed after Four o'Clock and the Debate having continued for half an hour, Mr. DEPUTY-SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at Sixteen Minutes to Five o'Clock.