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Clause 35—(General Reserve)

Volume 464: debated on Tuesday 3 May 1949

The text on this page has been created from Hansard archive content, it may contain typographical errors.

I beg to move, in page 40, line 34, to leave out "replacements," and to insert:

"depreciation of assets or renewal of assets."
This is a very limited matter. In Clause 37 it is provided that proper provision for depreciation of assets or for renewal of assets shall be included as outgoings properly chargeable to revenue account. It would appear that Clause 35, which is worded differently, is intended to have a different meaning. The object of the Amendment is to try to bring the two Clauses into line if, indeed, the same intention is covered by both. It is little more than a drafting Amendment. If I have not interpreted the intention correctly, perhaps the right hon. Gentleman will correct me?

We have had this matter raised before in previous nationalisation Measures, and if my recollection serves me aright, we have had discussions on this point. Wording such as this was included in the Transport Act, in the Electricity Act and, to my own recollection, in the Gas Act. I cannot help thinking that the right hon. Gentleman and his hon. Friends are forgetting that Clause 37 deals with the point which he has in mind, and deals with the question of depreciation and renewal of assets. I must admit that when the right hon. Gentleman was speaking my attention was distracted, and that he may have put this point to me. If so, I apologise. What I am saying now is that in our view the word "replacements" is the correct word, and I must ask the House to adhere to it.

The right hon. Gentleman's argument was addressed to the precise point which I was making, and he reinforced the statement I made in everything that he said. That goes to show the great loss to the public interest when what I say is not properly appreciated on the other side of the House. Clause 37 provides that proper provision shall be made for depreciation of assets and for renewal of assets and that they are properly chargeable against revenue. Under this Clause, however, it appears that depreciation is of intent left out of the wording of the Clause, and the Amendment seeks to bring the two Clauses into line. As the right hon. Gentleman has said that what is really meant are the words contained in Clause 37, I take it that he will accept the Amendment to add these words to Clause 35 in order to make the two Clauses agree.

No. What this Clause does is to give the Corporation power to establish a general reserve. The point which the right hon. Gentleman has in mind is dealt with, as he himself has said, in Clause 37. We must, so it seems to us, leave to the Corporation the right to establish this reserve in its own way and not lay down any hard-and-fast rule for that purpose. If the right hon. Gentleman will look at the wording of the Clause, he will see the word "replacements," and then the Clause continues: or other purposes." I think that those words are wide enough to effect anything that the Corporation may want to do, and I hope that the House will adhere to the wording as it is.

I must say that I feel somewhat frustrated in my inability to get the right hon Gentleman to grasp what seems to me to be an extremely simple point. In Clause 37 we have the exhortation, if I may put it that way, about the sums which are chargeable to revenue account, and it specifically says that amongst those sums which are to be chargeable are amounts set to depreciation. In Clause 35 the word "depreciation" is, apparently of intent, left out, and anyone reading the two Clauses together would imagine, since the wording is different, that the intention is different. I hope that I have now made the point crystal clear, and it is not a metaphysical point. If the intention is different, let us hear what it is. If the intention is the same, let us have the same words to express the same intention. It is no good the right hon. Gentleman saying that Clause 37 covers the matter in Clause 35. because it does not. This Clause deals with the power of the Corporation to create a general reserve with certain reserves for replacements and depreciation, and Clause 37 deals with the sums to be charged to revenue account. These are two entirely different things. Clause 35 begins:

"Without prejudice to the Corporation's power to establish appropriate reserves for replacements.…"
and later on we find also that depreciation is to be chargeable to revenue. Unless there is some change of intention, one would expect to see the words "or depreciation" after the word "replacements." I am completely frustrated to know how I can convey my meaning in any clearer words.

For myself, I find the Amendment muddy and obscure, and I hope the right hon. Gentleman and his hon. Friends will make it clearer—crystal clear I think is what they want. Under Clause 37 there has to be proper provision for depreciation of assets or for renewal of assets. It is only after that that proper allocations are to be made to the general reserve. If I understand the Amendment rightly, it is now proposed that in Clause 35, which deals with the general reserve, provision should be made for the very things which have to be provided for before anything can be put to the general reserve. If that is crystal clear, if it is anything but muddy and obscure, I hope we shall have some explanation of how there is to be credited to the general reserve something for which provision will already have been made before coming to the general reserve.

The hon. and learned Member for Kettering (Mr. Mitchison), in one of his very useful interventions, has made the situation very much more obscure than it was before, because it is now quite impossible for the Financial Secretary to ride off in the way he sought to do: These expressions have very definite connotations for tax purposes, and the questions of replacement allowances, wear and tear allowances, and depreciation allowances are very different things. I think the hon. and learned Member is suggesting, inferentially, that "replacement" is included in "renewal of assets."

If it is not included in "renewal of assets," what does the expression "renewal of assets" mean? In Clause 37 two matters are referred to. There is depreciation, which is fairly easily understandable, and renewal of assets, and there is a duty upon the Corporation to ensure that each company provides out of current revenue adequate allowances for these two matters. If those two matters are provided for, what is the purpose of this extra provision out of general reserve? Of course, the reason for having provision in the general reserve for depreciation is because, on the values from year to year, the allowances for depreciation may not be adequate owing to increasing costs of replacement and renewal. Therefore, any prudently managed concern will seek to have in its general reserve a substantial figure which it can use under certain contingencies to make up inadequate allowance for depreciation.

If the hon. and learned Member looks at Clause 37, he will see that that point is met, because there has to be not only provision but proper provision for those two things. What I confess still puzzles me is why, when proper provision is made before coming to the general reserve, it is suggested that we should do something which ought already to have been done.

The answer to that point is that provision may at the time seem perfectly proper, and it may seem to be completely adequate, but at the same time it is wise to have a general reserve to cover certain contingencies. If, as I understand it—and this is where the Financial Secretary and his hon. and learned Friend appeared to be at variance—the right hon. Gentleman does intend to have a general reserve to cover the sort of contingencies that I imagine, why does he not state that that general reserve should be for the same purposes? Is he not simply adding a note of confusion and uncertainty by using different phraseology in the two Clauses.

Is the hon. and learned Gentleman now suggesting that in Clause 37 "proper" means "insufficient"?

I thought my point was perfectly clear. As I understand it, Clause 37 deals with what is to be charged to revenue account in each year. It may be that in addition to what is charged to revenue account—in other words, the amount the tax authorities are prepared to allow in respect of depreciation allowance—it is wise to have a general reserve to cover certain contingencies. In other words, Clause 37 deals with the year-to-year position and Clause 35 seeks to make some longer-term provision.

3.45 p.m.

I again apologise for not hearing what the right hon. Gentleman said in his first speech. In the general movement of Members out of the Chamber, I could not catch what he was saying. I think I now completely understand what he has in mind. What my hon. and learned Friend the Member for Kettering (Mr. Mitchison) has said establishes what is the position. In our view, it would be wrong to take out the word "replacements" and to insert, as suggested, "depreciation of assets or renewal of assets," because they are taken from Clause 37. In Clause 35, we want to give the Corporation elasticity when they establish their reserve. They can put to reserve, to expend later, such sums as they have put by for renewal of assets. There is not the slightest doubt about that. If we stick to these words and those which follow—"or other purposes"—they can put to reserve moneys to meet forthcoming or accruing taxation. Therefore, in our view the word "replacements" is the correct word.

An additional reason why we should retain these words is that we have used them in earlier Measures. If we now depart from what was then well understood and is now embodied in Acts of Parliament, although we may mean the same thing when we use another form of words, it might mean that those who have to go through Acts of Parliament in order to discover what was the intention of Parliament would begin to think that we here intended something different from what we intended in previous Acts. We intend exactly the same. Therefore, I repeat the hope that the House will retain the word "replacements."

I am unwilling to pursue this matter, which seems to me to be a very small one. Every time the Financial Secretary speaks he gets deeper and deeper—

I hate to interrupt the right hon. Gentleman, but I must point out that we are on the Report stage, and that the making of speeches from one side and another without leave of the House is undesirable.

The right hon. Gentleman is quite correct. As he moved the Amendment, he can speak again, but nobody else ought to do so, except the Government spokesman.

I have no intention of abusing the fortunate position I occupy as the Mover of this Amendment. I would only say to the Financial Secretary that three different forms of wording are used in different places: there is "replacements," "renewal of assets," and, thirdly, "depreciation of assets." We all know that "depreciation of assets" is different from the other two. The right hon. Gentleman is now trying to draw a distinction between "replacements" and "renewal of assets," and goes on to say that they mean exactly the same thing, and that that is why different words have been used. A general principle which he will find very useful is, when he means the same thing in a Bill to use the same words. That would save a lot of time. I am fairly content to know that the intention is the same. Perhaps between now and the time when the Bill reaches another place, the Government might consider using the same words to denote the same thing. With those emollient phrases, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

I beg to move, in page 41, line 3, after "directions," to insert: "in pursuance of section four of this Act."

I think it might be convenient to discuss also the proposed Amendment in line 9, at end, insert:

"(c) the amount of the said reserve shall not at any time exceed 10 per centum of the total issued amount of British Iron and Steel stock at that time."

Under Clause 4 powers are given to the Minister to make directions in relation to matters which appear to him to affect the national interest. The "national interest" is one of those meaningless phrases the extent of which it is extremely difficult to appreciate. It may mean the fixing of a price or doing anything under this Clause which lies with the people employed in the industry, with the people who consume the products or with the Government who wish to protect the industry. It is no good saying that everyone knows what the national interest is, because it is difficult to define. It is a little naive in all these Bills to talk about the national interest.

I do not want to be led from the particular point I am about to develop. The powers under Clause 4 are given to the Minister in order that he may intervene in relation to matters which appear to him to affect the national interest. If he attaches greater weight to what is the national interest then it covers my point. However, he may give directions in relation to the management of reserves, but that is carrying intervention or interference much too far. His powers should be confined to issuing directions about the reserves only where he considered it in the national interest.

It would be better if powers of a specific kind were given to him which would give a special control over the way in which the Corporation establishes a reserve, and if that reserve took the form of cash, in what direction that cash could be invested. It ought to be stated in the Bill whether the Minister intends to use his power with regard to the reserves only. Has he to consider whether the national interest is at stake or is he putting his finger into this particular pie as a right, even when it is not considered a matter of national importance?

The Clause as it stands indicates specifically that the Minister's power to give directions is not to be limited to the power to give general directions such as are specified in Clause 4 (1). Subsection (2, b) contains the words:

"…notwithstanding that the directions may be of a specific character.…"
If the difficulty that the right hon. Gentleman feels is that there is an uncertainty about what the directions can cover, the answer is that it is quite clearly stated in the Clause that they can be specific. The Minister will, of course, only give directions which are in the general interest. This will be the guiding motive which he will always follow in whatever direction he may give whether of a general or a specific character. He must have power to give specific direction in cases connected with the general reserve fund. Hon. Members opposite should bear in mind that the fund may be very large indeed. They have an Amendment on the Order Paper asking that the fund should not exceed 10 per cent. of the stock issued by the Corporation.

On a point of Order. Mr. Speaker, would you resolve the difficulty which I am in? I thought you said that we should discuss the Amendment to line 2 and with it deal with the Amendment to line 9.

That is what my intention was, and I was rather listening to hear something about the Amendment to line 9.

I addressed myself to the Amendment to line 3. I did not think that the Amendment to line 2 after "shall," insert "subject to the provisions of this subsection," had been called.

I was in some doubt myself as to what Amendment I should answer. I thought the right hon. Gentleman was addressing himself to the Amendments to line 2 and line 3.

As apparently we have passed line 2 we had better deal with line 3, and if necessary we have the Amendment to line 9 over the page and we can deal with it when we reach it.

I will if I may conclude the argument that I was presenting. I was endeavouring to answer the right hon. Gentleman's argument by reminding the House that this fund may be very large. There is no statutory limitation imposed upon it but its size is left to the Corporation. It may be very large indeed, and it is felt that the Minister should be empowered to give specific directions about it. If I may give an example; it may be envisaged that specific directions should be given on how the fund should be used. It may be for the purpose specified under subsection (3), which is a declaratory section that one of the purposes of the fund is to check undue fluctuations in prices.

It may be that the Minister would want to give a specific direction on that, and in view of what I have said it is right that the Minister should have the power to give specific and well as general directions in the case of these very large reserves, which will be available. That is the power which the Clause at present gives, and for those reasons I hope the House will not accept the Amendment.

The right hon. and learned Gentleman spoke about using the reserve fund to check undue fluctuations. Would that be consistent with the duty under Clause 31 to make the revenue of the Corporation not less than sufficient to meet their combined outgoings?

That would be entirely consistent. The checking would obviously have to be done in the light of the duty imposed by Clause 31.

I do not think the reply by the right hon. and learned Gentleman is entirely satisfactory because it does not meet the precise point we were on. The point is that Clause 4 deals with the powers of the Minister in relation to the Corporation and sets them out. They are general powers. They do not go on to specify any particular point of detail which the Minister might deal in intervening on this question of reserves held by the Corporation. On going through the Bill we can find that the Minister is given powers of a specific character which are not related at all to the general powers that are taken in Clause 4. All we seek to do by this Amendment is to tie the specific powers of the Minister back to the general intent of Clause 4. I do not think the right hon. and learned Gentleman has dealt with that point, and the reply which he has given is, to my mind, still unsatisfactory.

4.0 p.m.

The explanation given by the Solicitor-General seems to make it clear that the powers which the Government seek in this Clause are an unjustifiable interference with the powers of management of the Corporation. That is a subject never yet fully resolved in this House. It is clear also from his explanation that this provision is part of a general policy for the direction of investment. I submit that the control of the reserve fund of the Iron and Steel Corporation is a matter which should be left to the unfettered discretion of that Corporation. If the Government wish to influence the control of investment—I agree that that is a most important part of the development of policy—let them make regulations which apply to all investment funds and not simply to the reserve funds of socialised industries.

It may very well happen that the powers now proposed will have very serious deleterious effects upon the management of the Corporation. It is not very long since we saw the Treasury pursuing a very hard drive for cheaper money. Under such a policy the Treasury might very well require the Corporation to invest their money in a manner which would not be in the commercial interests of the Corporation and possibly might not be in the best interest of the nation as understood by other persons. I seriously suggest that this proposal is rather a grave infraction of the powers of management of the Corporation. I do not wish to suggest for a moment that control of investment is not a most important subject, but I ask that we should not have discriminatory provisions of this nature. Let us treat the control of investment as a matter of general financial policy and not as a part of a policy only for socialised industries.

The speech of the hon. Member for Keighley (Mr. Ivor Thomas) leaves me very puzzled. Throughout most of the proceedings on the nationalisation Measures, and certainly during the Committee stage of this Measure, we have heard insistent demands from the Opposition for a greater degree of accountability to Parliament in the operation of this industry. Over and over again we have heard hon. Members opposite complain. I, for one, believe that those complaints have some justification, and that in some of the nationalised industries the corporations seem to have powers which we as a House of Commons cannot get at to query.

Now the hon. Member for Keighley, presumably reflecting the views of his hon. Friends, is saying that he wants discretion in the matter of investment of the Corporation's reserves—he himself says that it is an extremely important matter—to rest entirely with the Corporation, to be exercised without any influence by the Minister and hence to be exercised without any possibility of this House querying any exercise of those powers.

The hon. Gentleman may shake his head but that is exactly the purport of what he was saying. I am sure he will appreciate that if the Clause remains as it is worded and the Minister gives directions to the Corporation to spend its reserves in a way of which the hon. Gentleman does not approve, he would not be slow in bringing that, matter to the attention of the House by Question or in any of the other ways afforded by the procedure of the House, so that we could debate it and call to account the action of the Minister in deciding that particular expenditure. If we did what the hon. Member is now asking us to do, that remedy for that grievance would then not be open to him.

I suggest that he is taking a line which is very different from that of the Opposition and one which on the whole is not in the best interests of democratic control of public corporations in an important matter such as the spending of their reserves in investments, because we should have taken the matter out of the hands of the Minister and hence out of the control of Parliament.

I did not hear my hon. Friend the Member for Keighley (Mr. Ivor Thomas) express the views which have just been attributed to him. The main point concerns the administration of the reserve fund. I think it will be primarily at the disposal of the industry. The hon. Member for Reading (Mr. Mikardo) has just instanced capital re-equipment and the like, as opposed to the possibility which I thought was envisaged by the Solicitor-General a few minutes ago when he referred to investment. It is true that the Clause says that the approval of the Treasury comes into the matter. It is not difficult to see just what that may mean.

We all know that not long ago the Government were anxious to establish their credit upon a 2½per cent. basis, and that reserves of all kinds were poured into the gilt-edged market with a view to bringing it to the 2½per cent. level upon which future loans could be launched. In that procedure, a good many unfortunate things happened. I forget the exact amount, but a very large portion of the Unemployment Fund was invested in Treasury 2½ per cents., with which the name of the Chancellor of the Duchy of Lancaster will always be associated, with a capital loss of 35 per cent. When that matter was raised on this side of the House we were told by the present Chancellor of the Exchequer that it was not lost but had merely gone before; that it had not been realised, and that there was no loss until it had. The fact remains that there is a very serious book loss.

I am sure that hon. Members on both sides of the House would be anxious to avoid that sort of thing happening to the reserve fund earmarked for the purpose of the steel industry. It would be valuable to have an assurance from the Minister that this reserve fund is not to be treated as a convenient hen roost to be raided whenever it is necessary to bolster up Government credit for the purpose of borrowing under some nationalisation scheme, or issuing a new Government loan for this purpose or that, but that it will be safeguarded for the purposes instanced by the hon. Member for Reading. If, as a result of this discussion, we could get an undertaking of that kind we should be happy on both sides of the House.

The hon. Member for Keighley (Mr. Ivor Thomas) puzzles me more and more. When a man sacrifices the convictions of a lifetime, he presumably does so on account of something that is of great importance to him. The hon. Member for Keighley has repeatedly declared that it was the Bill which made him take that step. Therefore I have followed his speeches in this Report stage—I was not on the Comm.jttee—with the utmost attention, to try to understand the point of principle—a point of detail would not have influenced the hon. Member—on which he was, quarrelling with the Government.

I have heard his speeches this afternoon and on Wednesday and Thursday of last week. On one day we had a Clause giving the Minister in certain ways a measure of answerability to the House of Commons for his handling of this industry. The hon. Member for Keighley was not satisfied, not because he did not want the Minister to be answerable but because he thought that the measure of answerability was not sufficient.

The hon. Member made a long speech in which he said in effect, "I am all for legislating about this important matter in such a way as to give to the House the maximum of control." Because the Clause did not do that—he did not oppose the Clause because he went part of the way with it—he subjected it to a drastic examination to show how illusory the control of the House of Commons was going to be. The Clause went through. Next day we had a Clause about subsidies. The hon. Gentleman went a very long way and said, "No subsidies at all because when we have the opportunity of getting subsidies there is a great temptation to apply for them and to cheat and in such circumstances temptation is not resisted and the country is defrauded." He was against subsidies altogether, but the House accepted the Clause with the subsidies. We are therefore to pay a subsidy and there is to be some measure of accountability in the House of Commons with which the hon. Member is not satisfied. He wants more.

What does he say this afternoon? We have a Clause which requires that there shall be a reserve fund and gives the Minister power to make directions generally speaking with regard to the administration and application of the reserve fund. Subsection (3) directly provides that the purposes of the general reserve include the checking of undue fluctuations in the prices of products of the Corporation. The matter of undue fluctuations of the prices has a direct bearing on the matter of subsidies with which the hon. Member was so very closely interested. Obviously if we are to pay subsidies we have the greatest possible interest in seeing that prices at any rate are not so managed as to make our liability to pay subsidies greater. Therefore it is impossible to see how we could possibly control the administration of these matters in such a way as to avoid the unnecessary payment of subsidies, unless there is a reserve fund applicable to it and the Minister has some powers with regard to the administration of the fund.

Will the hon. Gentleman concede that if his arguments are correct, it might well be described as in the national interest for us to control fluctuations? What I am concerned about is carrying the thing down to particular investments.

Perhaps the right hon. Gentleman will permit me to deal with one argument at a time. I dare say there is something in what he has said—I do not dissent from it for a moment—but I am dealing with the hon. Member for Keighley who is against this because he says it is an unwarrantable interference with the private right of the corporation to manage its own reserves. I am utterly and completely puzzled about what the hon. Member wants and why he quarrelled with the Government and his colleagues, because on one occasion he advocates no subsidies and more control and on this occasion, when we are discussing the Government having the opportunity of administering by parliamentary accountability and responsibility—the only method whereby subsidies can be controlled—he is against it and says it is an unwarrantable interference with the private right of the Corporation.

If we are to control these matters we need a reserve fund having among its objects the direct object of controlling fluctuations in prices, power for the Minister to interfere in that matter, and, ultimately, the right of the House of Commons to call upon the Minister to account to the House for what he does under these provisions. I should have thought on the arguments of the hon. Member on the other matters to which I have referred that he would have welcomed the Clause enthusiastically. Instead of that, he rejects it on grounds which utterly destroy the intelligibility of the arguments he was advancing to the House on Wednesday and Thursday.

The hon. Member has got himself into a complete muddle about this matter and he ought to start thinking about it again from the beginning. Is he in favour of the nationalisation of industries basic and essential and vital to the life of the community or is he against it? If he is in favour of it or some of it, does he want it in such a way as to give the House of Commons some kind of control or does he want a completely unrestricted, uncontrolled and undirected private monopoly? He must make up his mind because he has taken an important step and adopted an important attitude. I am afraid that if he continues to make contributions of this kind many of us will be driven to the conclusion that he has not been quite candid to the House or to the country as to his reasons for quarrelling with his colleagues.

4.15 p.m.

The hon. Member for Nelson and Colne (Mr. S. Silverman) has devoted considerable time to replying to what he thought was the speech of the hon. Member for Keighley (Mr. Ivor Thomas), but having listened to the hon. Member for Nelson and Colne, I am completely at a loss to understand whether he was speaking for or against this simple and innocuous Amendment. Will the right hon. and learned Gentleman give the Amendment a little more consideration? I do not believe that its acceptance would in any way detract from the Bill; it would improve it. He drew attention to the fact that under Clause 4 (1) there is power to give general directions, whereas under Clause 35 (2, b) there is power to give specific directions. He emphasised the necessity for giving specific directions. I want him to consider this. Why it it that under Clause 4 (1) we have the specific requirement that directions must be in the national interest and yet those words are omitted from this Clause?

All the Amendment seeks to do is to provide that in giving his directions under this Clause the Minister shall do so in the national interest. It will not stop him giving specific directions. It may to some extent limit the field of those directions by providing that the directions must be in the national interest. I want the right hon. and learned Gentleman again to consider whether he can accept these words which, on his own statement, appear merely to implement what he says is the intention here. So far as the hon. Member for Reading (Mr. Mikardo) is concerned, acceptance or the Amendment would not deprive the House of any opportunity it now has under the Clause of putting questions to the Minister as to the exercise of his powers of giving direction. All the Amendment does is to insert the words which the Government thought necessary to insert in Clause 4 (1), putting them in by reference to Clause 4. We could save a lot of time if the right hon. and learned Gentleman would accept the Amendment.

Amendment negatived.

I beg to move, in page 41, line 6, to leave out "or the application thereof."

The arguments covering this Amendment have already been expressed in our discussion on the previous Amendment, and I will not repeat them. I want to refer to one point on which the hon. Member for Nelson and Colne (Mr. S. Silverman) touched. I see the force of saying that if we wish to use this reserve for controlling the fluctuations in the price of a certain product, that certainly affects the matter of subsidies to which he referred, but I would say that that is a matter of national scope. What I am seeking to do, rightly or wrongly, is to prevent the Minister from assuming the burden of responsibility of giving specific directions to the Corporation about investment in companies which may be outside the iron and steel industry.

I take it that the object of the right hon. Gentleman throughout this series of Amendments is to make sure that the Minister gives directions only on matters where the national interest is concerned, but is he not making a great deal of bother out of a small point? The words he wants to modify are those at the beginning of paragraph (b):

"the power of the Minister to give directions…"
The only powers the Minister has in this Bill to give directions are those under Clause 4, which are powers to give directions in the national interest.

The object of our previous Amendment was to bring these powers within the ambit of Clause 4. I am not saying that the hon. Gentleman is wrong but, as I read it, the Minister here is taking powers different from those given to him under Clause 4.

I think the Law Officers must answer because then we shall only have to deal with them once.

But the right hon. Gentleman must make the point before it can be answered.

I am making this point, that as I read the Bill, the powers which the Minister is taking over the investments of these reserves are of a specific nature and not directly related to the powers which he takes under Clause 4 (1). I say that under Clause 4 (1) he would not be able to direct the Corporation to invest its reserves in a particular project or undertaking. He would certainly be able to direct that the reserves should be applied to equalising some of the cost of the products of the Corporation, because that would cover the point about the nation, but he would not be able under Clause 4 (1) to say, "I direct that £150,000 of the reserve of the company shall be invested in a guest house for the benefit of visiting officials of the Ministry of Supply at Pontypridd."

Would not the right hon. Gentleman agree that the effect of his Amendment would be to prevent the Minister from doing what he has just said it would be proper for the Minister to do, namely, to use the reserve fund to equalise out? The effect of the Amendment would be that the Minister could say to the Corporation, "You must put this much into reserve," but would prevent him from saying to the Corporation, "You must take this out of reserve." Clearly he cannot use it as an equalisation fund unless he has powers to do both those things.

The equalisation of prices is specifically provided for in the next part of the Clause.

I think it would be sufficient for the purpose which I think we have in common here if the Minister were to say, "In the national interest we consider that there are too violent fluctuations in the price structure of steel, and I give you directions under Clause 35 (3) that you must use your general reserve, if necessary, for securing stability." If the words in my Amendment were taken out, the Minister would be prevented from saying, "I think this or that security, quite outside the iron and steel industry, would be a suitable one in which to invest the reserves of the company." If I may suggest it with respect, the right hon. and learned Gentleman might clear up the point which I have not called in dispute but about which there is a difference of opinion between myself and the hon. Member for Nelson and Colne (Mr. Silverman).

Undoubtedly with the words "or the application thereof" in paragraph (b) of this subsection the Minister could give a direction about the investment of a portion of the special reserve. Clause 4 gives him a power only to give general directions in matters which he thinks affect the national interest. The use of the words "affect the national interest" is for the purpose of describing the general directions he can give. Clause 4 (1) gives him only those general powers. Clause 4 (4) also gives him a power in relation to certain matters, to give specific directions, because that subsection extends the power given to him in subsection (1). If one looks at Clause 4, one finds, to begin with, that the Minister has a general power and in subsection (4) he is given, in addition, the power to give certain specific directions—for example, a direction to the Corporation to discontinue or restrict any of their activities.

Yes, they are cast in a negative form, but the effect of a negative direction like that may have both negative and positive results. However, that is getting into a rather academic field of discussion.

With respect, I do not think the Solicitor-General is quite representing what I mean. What we are talking about is the application of reserve funds to specific objects, and I suggest that he is not entitled to say that that matter is covered already by Clause 4 (1) because certain negative powers are added to the ones of a general nature which cover only the national interest. I hesitate to suggest it, but I think he has resolved the first part of this legal dispute in a most unexpected way by suggesting that I am right and the hon. Member for Nelson and Colne is wrong. I do not suppose it will happen again, but it has happened on this Amendment.

I had only begun to say what I wanted to say when the right hon. Gentleman intervened. I was seeking to point the contrast between Clause 4 and the Clause we are discussing. I was saying that Clause 4 gives power to make two different kinds of directions, general and specific. When one comes to Clause 35, one finds a new power to give specific directions. I do not deny that for a moment. Of course, those directions can only be such as the Minister thinks are in the national interest; he is not given the power under this Measure to take any course which he thinks is contrary to the national interest. All the powers which he exercises under it, he exercises as trustee for the nation and in the national interest. It is a matter of controversy about whose view is right. Hon. Gentlemen opposite take one view and we take another.

May I complete this, because I shall never complete my argument if I do not at least make this point. The Minister is given a power by this paragraph to give specific directions which he thinks serve the national interest. To answer the question put by the right hon. Gentleman, as the paragraph is now worded, those specific directions could certainly be to the effect that a portion of the fund shall be or shall not be invested in a specific way. They need not be limited to a direction that the total funds shall be applied in one way or another. For example, they can deal with a specific part of the fund.

It is a matter of principle and policy how far the Minister ought to give those directions and how far it would be wise and prudent to interfere with the judgment of those responsible for managing the Corporation, but that would have to be judged in relation to the actual circumstances existing at any given time. I say without reserve, however, that the power he takes is one which enables him to say, if he thinks it necessary to do so in the national interest, that a certain portion of the fund or the whole fund shall be invested in a specific way, or shall be changed from one investment to another, or shall not be invested at all in the way in which it was intended. That power he does take.

4.30 p.m.

If the Amendment were accepted, it would produce a curious, lopsided effect on the power which is given to the Minister, because he would still have power to give a specific direction. Under the earlier part of paragraph (b)—
"…as to any matter relating to the establishment or management of the said reserve or the carrying of sums to the credit thereof"—
he could still give specific directions with regard to that; but when one came to the question of direction with regard to the application of it, he could not give one. That would be the result of the Amendment. We feel that the Minister must reserve to himself the power, in case of need or in case he thinks it necessary so to do, to give this sort of direction with regard to this very large pool of available reserve, which will be there to be used for national purposes in case it is required to do so. The national interest does require, so we thought in framing the Bill, that the Minister should reserve to himself that power in case of need. I repeat that whether and how he will exercise it, is a matter to be decided in relation to given circumstances at any given moment.

The question we are now considering is whether or not he ought to reserve that power to himself. If he has power to give a specific direction, it is entirely illogical that that specific direction—that can extend, for example, to saying what is to be carried to the credit of the reserve fund, as the paragraph provides—shall not extend also to how the fund shall be invested or applied. For those reasons, we think that to cut out the words "or the application thereof" would make nonsense of the paragraph. If the Minister is to have specific powers at all, they certainly must par excellence extend to the question of investing this very substantial fund or any ascertainable portion of it. Therefore, I hope the House will agree that no case can be made in support of this Amendment.

I am afraid I cannot agree with the right hon. and learned Gentleman. First of all, he said that the Clause would be lopsided if the Amendment were accepted. He sought to say that because the Minister is given specific powers relating to the establishment of a reserve, or the management of the said reserve, it automatically means that he must be given powers to invest it where he will. That arises from a profound misapprehension of what usually happens to reserves; that is not an uncommon error from the Treasury Bench. Reserves are not by any means always cash or investments which are outside the business. Far from making the Clause lopsided, the effect of the Amendment would be that, except for general directions which he would have to give in the national interest, the Minister would have to see that the reserve funds were invested in the businesses out of which they were originally made, and in no other businesses. In the exercise of the powers under Clause 4 (1), the reserve funds created would have to be re-invested in the businesses out of which they were originally made. That is not lopsided. It is what we call common or garden sense.

I will not follow the right hon. and learned Gentleman into a discussion of how "specific" can be described as being the same thing as "national." Of course, we all know that everything is for the best in the best of all possible Socialist worlds; and that nobody does anything unless he is quite certain it is in the public interest and, as a corollary, in the interest of the Socialist Government. But when it is said that one power is to be exercised in the "national interest" and that another is a "specific" power to be exercised over the investment of a sum of money, then the word "specific" is used in contradistinction to the word "national," otherwise it is perfectly meaningless. When I say that I am going to do something locally or sectionally, I mean I am not going to do it nationally, cosmically or anything else, otherwise the words do not mean anything. I am afraid that we are not getting very far with the right hon. and learned Gentleman.

Some of the uneasiness, caused to hon. Gentlemen opposite by the phrase "the national interest" may well be due to the history of this industry, in which the national interest has not always been sufficiently considered. I am puzzled by the Amendment and I find it difficult to follow. Its object appears to be to prevent the Minister giving directions about the application of a general reserve, one of the objects of which is the financing of what I will call capital works.

I shall take one instance, which seems to be sufficient. Let us suppose that in the development of atomic research it may be practicable to use atomic power in setting up a large steelworks or some works that perform one of the operations in connection with iron and steel. That seems exactly a matter upon which it would be proper for the Minister to give directions as to the use of this reserve fund to finance that work; it does not seem to be a matter upon which the Corporation ought to be compelled to take a decision on its own, without the special knowledge and responsibility that attach to the Minister and the Government on that particular question. It is for that sort of reason that I should have thought it was necessary that the Minister should be able to give a specific direction as to the application of the reserve fund in financing capital work.

There is a second reason. I represent a place called Corby, where new iron and steel works have had, and are having, a very considerable social effect. It seems to me that one of the difficulties about iron and steel development in the past has been that those who were purely concerned with its business side did not have sufficient regard to the social consequences of the changes they were making. That aspect will be more fully considered now that this industry is being taken under public ownership. When, however, it is a question of considering that aspect of the matter, it seems to me that the right person to do so is the Minister, and not the Corporation, particularly since the Minister is answerable to this House not only for the economic, but also for the social effects of the directions he may give as to applying this reserve fund, and for that type of reason. Whatever difficulty hon. Gentlemen opposite may find in understanding the meaning of the words "the national interest," I should have thought that they would at least have seen that it was in the national interest to give the Minister the power which they want to remove from him by the Amendment.

I should not have thought that the argument just adduced by the hon. and learned Member for Kettering (Mr. Mitchison) would appeal to certain members of his party, notably those on these benches below the Gangway, who take an interest in modern warfare. We now seem to be developing something of very great significance from this tiny phrase in paragraph (b) of Clause 35 (2), and it is a matter for consideration whether the right hon. Gentleman ought to introduce some new Clause in the Bill more specifically defining his powers over the Corporation.

The hon. and learned Member for Kettering says it might be quite proper for the Minister to give directions for the opening up of some new atomic development establishment and that the Minister would have recourse to this little phrase in this part of the Bill and would give the Corporation those instructions. If what is to be done is of that order, it seems that something mope substantial should be brought out about it in the Bill. There should be a new interpretation of Clause 4 and words added to Clause 4 and the words left out here, because this Clause deals with the more or less simple matter of how the Corporation are to use their reserve fund, particularly that part of the reserve fund which is not invested in the business of iron and steel. In a moment we shall be considering the ordinary powers of investment of money temporarily in the hands of the Corporation.

I do not think the Government are intending to make use of this phrase to oblige the Corporation to disinvest anything of its substantial iron and steel holdings to carry out the special applications of this reserve fund. If they are, they ought to indicate that to the House. We can take the view that a dispute will arise between the Government and the Corporation in the matter of the application of these reserves. For example, there might be a Minister of Supply who is an absolute zealot in the establishment of the social welfare State, more than general public feeling and even the feeling of his own Government. He might say to the Corporation, "Disinvest your temporary reserves and build rest homes for the ageing parents of steel workers all over the country." The Corporation might reply, "This is not a policy we can carry out at this stage. We are about to enter a tremendous competition with the iron and steel producing firms of the United States, Belgium, Luxembourg and France. For the next five or 10 years, our steel workers must rest content with the homes they have, and their parents must also be content."

That is the kind of dispute that may arise between the Minister and the Corporation. I cannot imagine it in the case suggested by the hon. and learned Member for Kettering, because we might all assume that atomic development work may be in the national interest, in the view of the Government and of all the people of the country, except the hon. Member for South Ayrshire (Mr. Emrys Hughes), who I see has just entered the Chamber. But the development of iron and steel in the way in which I have suggested a zealot for the Socialist welfare State might desire it, would not be in the national interest.

In the hypothetical case put by the noble Lord of a difference of opinion between the Minister and the Corporation as to whether the time had come and whether the reserve was large enough for such a purpose, is the noble Lord saying that the Corporation, without direction, is a better judge of such a question than the Minister, who is answerable to the House of Commons?

I do not know who would judge; that is the difficulty. The Corporation ought to be primarily concerned with its economic circumstances and economic future and the Minister of Supply, assuming he had the character I have given him, might say that it was in the national interest to press on with the provision of social capital for the industrial workers. A dispute would arise and I do not know who should decide. I see it arising under this phrase and I think the right hon. Gentleman ought to look again at Clause 4 and see whether it would be better to elaborate it and leave out the words of which we complain here.

4.45 p.m.

The noble Lord the Member for South Dorset (Viscount Hinchingbrooke) has followed the right hon. Member for Aldershot (Mr. Lyttelton) into what seems to me to be a complete misconception of what would be the effect of this Amendment if it were carried. Having listened very closely to all the arguments, I am quite sure that the Amendment would have the precisely opposite effect from that which the right hon. Gentleman says he wants done and, conversely, the things he wants done are already safeguarded in the wording of the Clause as it stands. May I draw the attention of the right hon. Gentleman and the noble Lord to the effect of subsection (3)? They both spoke of the danger of the dissipation of the Corporation's reserves, or, at least, of the expenditure of those reserves, outside the steel industry. The right hon. Gentleman talked about the investment in other businesses or industries and the noble Lord spoke of their investment for what he described as social purposes.

Subsection (3), whilst it does not say what shall be done and what shall not be done—it is subsection (2) which does that—describes the two purposes for which the reserves are set up. One is the checking of undue fluctuation in the price of products of the Corporation and the other is the financing of capital works. On both sides of the House we are agreed that these are proper purposes for which the reserves can be used and no one would have any objection to the Corporation, with or without direction, using them for those purposes.

I agree that those purposes are included, but, perhaps the hon. Member will address himself to the sort of thing I am trying to prevent—when there is a surplus of steel the Minister of Supply might buy shipbuilding companies to get rid of surplus steel and be driven further and further into other industries.

The right hon. Gentleman's intervention shows that we are united on purposes, but there are differences of interpretation. Investment in companies outside the Corporation's normal activities is covered, not in Clause 35, but in Clause 36. The right hon. Gentleman will observe that the Minister has no specific powers of direction there. The fact that the subject of Clause 36. has been taken out and made a separate Clause, away from Clause 35, which describes the Minister's powers of direction, ought to satisfy the right hon. Gentleman. It ensures, as he and the noble Lord appear to want to ensure, that, so far as that type of investment is concerned, it shall be at the discretion of the Corporation themselves. Reinforcing the separation out of that subject into Clause 36 is paragraph (a) of subsection (2) of this Clause, where the quite complete, comprehensive and explicit proviso is laid down that

"no part of the said reserve shall be applied otherwise than for the purposes of the Corporation or of publicly-owned companies."
When the right hon. Gentleman says that the purpose of the Amendment is to ensure that the reserves of the Corporation are not invested in all sorts of irrelevant projects of one sort and another I am sure he is overlooking the combined effect of paragraph (a) subsection (2) and the purposes which are set out, even with the reserve he instanced, in subsection (3) and the separation out from Clause 35 and putting into a separate Clause away from the Minister's powers of direction. The combination of those three safeguards us against the dangers the right hon. Gentleman has in mind.

I am seeking to follow the hon. Member's argument. I appreciate his argument in relation to Clause 36. He will recollect that the Government introduced an Amendment to Clause 2 with regard to the acquisition of other companies. Surely it would be perfectly possible for the Minister to give a specific direction under Clause 35 for part of the reserve funds to be used to acquire one of the companies referred to in the new Clause 2. The hon. Member will recollect that such a company could be acquired for any purpose authorised by its memorandum of association.

With deference, I should have thought that such a direction as the one which the hon. and learned Member describes would expressly violate the provisions of Clause 36, which clearly says that the Corporation shall not have power under that Clause, which deals with the investment of the reserves of the Corporation, to invest its reserves in the securities of any company so as to make that company a subsidiary of the Corporation. I should have thought that what the hon. and learned Member envisaged would cut across Clause 36. I am trying to describe why I think that the purposes which the right hon. Gentleman says he seeks by this Amendment are already fulfilled in the wording of the Clause as it stands.

I now wish to try to show that if the Amendment were carried, the purposes which the right hon. Gentleman agrees are proper for the investment of the reserves, could not be carried out. When I intervened in the course of the right hon. Gentleman's speech to point out what I thought would be the effect of the omission of the words which he seeks to delete, he referred me to subsection (3). That subsection, as I have already pointed out, is a statement of purpose or intention, and it does not say what can or cannot be done. If one re-reads Clause 35 (2 b) without the words "or the application thereof" that paragraph then seems to me to say that the Minister can say to the Corporation, "You must put this money into reserve," but he cannot say to the Corporation at any time, "You must take this money out of reserve for this purpose."

I should like to quote a possible example, that of my right hon. and learned Friend. The Minister might say to the Corporation, "The developments in atomic energy are now getting to the stage when for the next five years you ought to put aside annually £2 million, because in 1958 you will probably be spending £10 million on an atomic energy power plant." The Minister could say that to the Corporation, but under subsection (2, b), amended as the right hon. Gentleman proposes, when 1958 arrived and the £10 million was then in reserve for the purpose of buying an atomic power plant, the Corporation could say, "We do not choose to spend it in that way," and the Minister could not direct them to spend it in that way. The ridiculous position would therefore arise that although money had been put into reserve for a certain purpose by agreement between the Minister and the Corporation, the Minister would have no power to ensure that that reserve was spent for that purpose.

Surely, under Clause 4 (1) the Minister has the clearest possible power to give a direction covering that case?

Then we get back to the question of what is general and what is specific. I should have thought that a direction specifically to set up an atomic energy power plant was a specific direction, and was excepted from Clause 4; indeed it was so excepted in the terms of the intervention of the right hon. Member for Aldershot, who pointed out, quite rightly, that the only specific powers in Clause 4 are negative and not positive powers. Therefore, under Clause 4, the Minister would not have power to give a specific direction that money should be withdrawn from the reserve for expenditure on the purpose for which it had been put to reserve.

If subsection (2, b) were amended as proposed by this Amendment, the Minister would not have any other power to give that direction, nor would he have power to give the Corporation a direction to take out money for the purpose of equalising prices, another purpose which the right hon. Member for Aldershot agrees is a proper purpose for the reserve. Thus the ridiculous position would arise, if this Amendment were carried, that the Minister would be able to say to the Corporation, "You are to put aside, in 1949, a sum of 10s. out of every ton of steel you sell for the equalisation of prices," but when 1950 came he would not be able to say, "You can now take that 10s. out in order to do that equalising." He would have power to tell them to put the money to reserve but never to tell them to take it out of reserve. I am sure that that ridiculous result is not what the right hon. Gentleman wants, and if he agrees that that would he the effect of his Amendment, I think that he himself would wish to withdraw it.

The first part of the hon. Member's case was devoted to quoting Clause 36 and to showing that, under it, the object which my right hon. Friend was endeavouring to maintain was safeguarded. But Clause 36 applies only to cash in hand, so to speak; it does not apply to the general reserve, which is the question under discussion. The hon. Member's second point was that the matter was safeguarded again by subsection (2, b) and the powers of the Minister to direct specific spending. Surely, under subsection (2) it is the Corporation which may determine how the spending is carried out. The general point which emerges is surely whether it is desirable that the Minister should interfere with the Corporation, which is now reduced more or less to the status of a holding company, with specific directions on the actual expenditure of that holding company on capital investment. The question at issue is whether that is right or not.

Surely the speech made by the hon. and learned Member for Kettering (Mr. Mitchison) was hardly a good recruiting speech for members of the Corporation, who, we are told, are waiting, so to speak, in the Minister's anteroom, ready to rush in and join the Board. They will be very discouraged to hear that the Minister is to have the power to butt in every time they decide to spend any money. We believe that this matter of the Minister's intervention as to how reserves should be spent should be relegated to a much higher level than the specific intervention which is permitted as the Clause stands.

If I may correct the hon. Member, I did not say what he attributes to me.

I did not attribute anything to the hon. and learned Member except the general sentiment which was the impression which the House received.

The other point which the Solicitor-General, when he made his gracious speech, seemed to omit was that Clause 4, subsection (4), states:
"Provided that—
(i) the Minister shall not give any direction under this subsection unless he is satisfied that it can be given effect to without prejudice to the proper discharge to the duties of the Corporation under this Act;…"
Surely it has always been rather difficult to find out what the proper discharge of the duties of the Corporation under this Bill actually is, because we first thought that the Corporation were to be an operating company; it now seems that they are to be a holding company. Surely one of the chief objectives and uses of a holding company is to see how its investment is made.

5.0 p.m.

It is on this question of how investment should be made that the Minister by this Clause, is overstepping the line which he should take with respect to the Corporation. I know it can be argued that there can be too little interference with the running of the Corporation, and there certainly can be too much interference. I believe that if this Amendment is accepted it will do something to right that balance. The balance is that the Minister should be able to interfere with the Corporation or the holding company on matters of general policy but not on matters of specific detail which this Clause gives him the power to do. I hope that the Minister will give this matter further and very serious consideration.

I hope someone on the Government Front Bench will say something on this matter. I do not wish to come between them and the House. I only want to ask a simple question, and it arises out of what was said by the hon. Member for Reading (Mr. Mikardo). He gave me a categorical assurance that, in his view, it would be impossible for the Minister to direct the Corporation to use part of the general reserve in order to acquire interests in any company under the new Clause 2. My mind would be substantially relieved if that opinion of the hon. Member could be fortified by the Minister or one of his supporters.

Question put, "That the words proposed to be left out stand part of the Bill."

The House divided: Ayes, 269; Noes, 154.

Division No. 121.]


[5.2 p.m.

Albu, A. H.Greenwood, A. W. J. (Haywood)Moyle, A.
Allen, A. C. (Bosworth)Grenfell, D. RMurray, J. D.
Alpass, J. H.Grey C. F.Naylor, T. E.
Anderson, A. (Motherwell)Grierson, E.Neal, H. (Claycross)
Anderson, F. (Whitehaven)Griffiths, D. (Rother Valley)Nichol, Mrs. M. E. (Bradford, N.)
Attewell, H. C.Griffiths, W. D. (Moss Side)Nicholls, H. R. (Stratford)
Austin, H. LewisGuest, Dr L. HadenNoel-Baker, Capt. F E. (Brentford)
Awbery, S. SGunter, R. JOldfield, W. H
Ayles, W. H.Hale, LeslieOliver, G. H
Ayrton Gould, Mrs. Hall, Rt. Hon. GlenvilOrbach, M.
Bacon, Miss A.Hamilton, Lieut.-Col. RPaling, Will T. (Dewsbury)
Balfour, A.Hannan, W. (Maryhill)Palmer, A. M. F
Barnes, Rt. Hon. A. J.Hardman, D. R.Parker, J.
Barstow, P. G.Hardy, E. A.Parkin, B. T.
Barton, C.Harrison, J.Paton, Mrs. F. (Rushcliffe)
Battley, J. R.Haworth, J.Paton, J. (Norwich)
Bechervaise, A. EHenderson, Rt. Hon. A. (Kingswinford)Pearson, A.
Beswick, F.Hicks, G.Part, T. F
Bing, G. H. CHolman, P.Perrins, W.
Binns, J.Holmes, H. E. (Hemsworth)Piratin, P.
Blackburn, A. R.Horabin, T. L.Popplewell, E.
Blenkinsop, A.Houghton, A L N. DPorter, E. (Warrington)
Boardman, H.Hoy, J.Porter, G. (Leeds)
Bowden, Flg. Offr. H. W.Hubbard, T.Price, M. Philips
Braddock, Mrs. E. M. (L'pl. Exch'ge)Hudson, J. H. (Ealing, W.)Proctor, W. T.
Braddock, T. (Mitcham)Hughes, Emrys (S. Ayr)Pryde, D. J.
Bramall, E. A.Hughes, H. D. (W'lverh'pton, W)Pursey, Comdr. H
Brook, D. (Halifax)Hynd, H. (Hackney, C.)Randall, H. E.
Brooks, T. J. (Rothwell)Hynd, J. B. (Attercliffe)Ranger, J.
Broughton, Dr. A. D. D.Irvine, A. J. (Liverpool)Rees-Williams, D R
Brown, George (Belper)Irving, W. J. (Tottenham, N.)Reeves, J.
Brown, T. J. (Ince)Janner, B.Reid, T. (Swindon)
Bruce, Maj. D. W. T.Jeger, Dr. S. W (St. Pancras, S. E.)Rhodes, H.
Burke, W. A.John, W.Ridealgh, Mrs. M.
Carmichael, JamesJohnston, DouglasRoberts, Goronwy (Caernarvonshire)
Chamberlain, R. A.Jones, D. T. (Hartlepool)Robinson, K. (St. Pancras)
Chetwynd, G. R.Jones, Jack (Bolton)Rogers, G. H. R.
Cluse, W. S.Kenyon, C.Ross, William (Kilmarnock)
Cocks, F. S.Key, Rt. Hon. C. W.Royle, C.
Collindridge, F.Kinghorn, Sqn.-Ldr EScollan, T.
Collins, V. J.Kinley, J.Scott-Elliot, W.
Colman, Miss G. M.Kirby, B V.Shackleton, E. A A
Comyns, Dr. L.Kirkwood, Rt. Hon. DSharp, Granville
Corlett, Dr. J.Lang, G.Shinwell, Rt. Hon E.
Cove, W. G.Lawson, Rt. Hon. J. JShurmer, P.
Crawley, A.Leonard, W.Silverman, J. (Erdington)
Crossman, R. H. SLeslie, J. R.Silverman, S. S. (Nelson)
Cullen, Mrs.Levy, B. W.Simmons, C. J.
Daggar G.Lewis, A. W. J. (Upton)Skeffington, A. M
Davies, Edward (Burslem)Lewis, J. (Bolton)Skeffington-Lodge, T C
Davies, Harold (Leek)Lewis, T. (Southampton)Skinnard, F. W.
Davies, R. J.(Westhoughton)Lipton, Lt.-Col. M.Smith, Ellis (stoke)
Davies, S. O. (Merthyr)Logan, D. G.Smith, H. N. (Nottingham, S.)
Deer, G.Lyne, A. W.Smith,, S. H (Hull, S.W.)
de Freitas, GeoffreyMcAdam, W.Snow, J. W.
Delargy, H. J.McAllister, G.Solley, L. J.
Diamond, J.McEntee, V. La TSorensen, R. W
Dobbie, W.McGhee, H GSoskice, Rt. Hon. Sir Frank
Dodds, N. N.Mack, J. D.Sparks, J A
Driberg, T. E. N.McKay, J. (Wallsend)Steele, T.
Dugdale, J. (W. Bromwich)Mackay, R. W. G. (Hull, N.W.)Stewart, Michael (Fulham, E.)
Ede, Rt. Hon. J. C.McKinlay, A. S.Strauss, Rt. Hon. G R. (Lambeth)
Edwards, Rt. Hon. Sir C. (Bedwellty)McLeavy, F.Stross, Dr. B.
Edwards, John (Blackburn)MacPherson, Malcolm (Stirling)Stubbs, A. E
Edwards, W. J. (Whitechapel)Mainwaring, W. H.Swingler, S.
Evans, Albert (Islington, W.)Mallalieu, E. L. (Brigg)Sylvester, G. O
Evans, E. (Lowestoft)Mallalieu, J. P. W. (Huddersfield)Symonds, A. L.
Evans, John (Ogmore)Mann, Mrs. J.Taylor, H. B. (Mansfield)
Evans, S. N. (Wednesbury)Manning, C. (Camberwell, N.)Taylor, R. J. (Morpeth)
Fairhurst, F.Manning, Mrs. L. (Epping)Thomas, D. E. (Aberdare)
Farthing, W. J.Mathers, Rt. Hon. GeorgeThomas, George (Cardiff)
Field, Capt. W J.Medland, H. M.Thomas, I. O. (Wrekin)
Follick, M.Mellish, R. J.Thurtle, Ernest
Foot, M. MMesser, F.Timmons, J.
Forman, J. C.Middleton, Mrs. L.Usborne, Henry
Fraser, T. (Hamilton)Mikardo, IanVernon, Maj. W. F
Freeman, peter (Newport)Mitchison, G. RViant, S. P.
Gallacher, W.Monslow, W.Walker, G. H.
Ganley, Mrs. C. SMoody, A. S.Wallace, G. D. (Chislehurst)
Gibbins, J.Morgan, Dr. H. B.Wallace, H. W. (Walthamstow, E.)
Gilzean, A.Morris, P. (Swansea, W.)Warbey, W. N.
Glanville, J. E. (Consett)Morrison, Rt. Hn. H. (Lewisham, E.)Webb, M. (Bradford, C.)
Gooch, E. G.Mort, D. L.Weitzman, D

Wells, P. L. (Faversham)Willey, O. G. (Cleveland)Wise, Major F. J.
Wells, W. T. (Walsall)Williams, D. J. (Neath)Woodburn, Rt. Hon. A
West, D. G.Williams, J. L. (Kelvingrove)Wyatt, W.
Wheatley, Rt. Hn. J. T. (Edinb'gh, E.)Williams, Ronald (Wigan)Yates, V. F
White, H. (Derbyshire, N. E.)Williams, W. T. (Hammersmith, S.)
Whiteley, Rt. Hon. W.Williams, W. R. (Heston)TELLERS FOR THE AYES:
Wigg, GeorgeWillis, E.Mr. Joseph Henderson and
Wilkins, W. AWilson, Rt. Hon. J. H.Mr. Richard Adams.


Agnew, Cmdr. P. G.Hare, Hon. J. H. (Woodbridge)O'Neill, Rt. Hon Sir H
Amory, D. HeathcoatHarvey, Air-Comdre. A. V.Peake, Rt. Hon. O.
Assheton, Rt. Hon. R.Haughton, S. GPeto, Brig. C. H. M
Astor, Hon. M.Head, Brig. A. H.Pickthorn, K.
Baldwin, A. EHeadlam, Lieut.-Col. Rt. Hon Sir CPonsonby, Col. C. E.
Barlow, Sir J.Henderson, John (Cathcart)Poole, O. B. S (Oswestry)
Beamish, Maj. T. V. HHinchingbrooke, ViscountPrice-White, Lt.-Col. D
Beechman, N. AHogg, Hon. Q.Prior-Palmer, Brig. O
Bennett, Sir PHollis, M. C.Raikes, H. V.
Birch, NigelHolmes, Sir J. Stanley (Harwick)Ramsay, Maj. S
Boothby, R.Hope, Lord J.Rayner, Brig, R.
Bossom, A. C.Howard, Hon. AReed, Sir S. (Aylesbury)
Bower, N.Hudson, Rt. Hon. R. S. (Southport)Roberts, H. (Handswotth)
Boyd-Carpenter, J. A.Hurd, A.Roberts, W. (Cumberland, N.)
Braithwaite, Lt.-Comdr. J. GHutchison, Lt.-Cm. Clark (E'b'rgh W.)Robinson, Roland (Blackpool, S.)
Buchan-Hepburn, P. G. T.Hutchison, Col. J. R. (Glasgow, C.)Ropner, Col. L.
Bullock, Capt. M.Jeffreys, General Sir G.Ross, Sir R. D. (Londonderry)
Butcher, H. W.Keeling, E. H.Scott, Lord W
Butler, Rt. Hn. R. A. (S'ffr'n W'ld'n)Kerr, Sir J. GrahamShepherd, S. (Newark)
Carson, EKingsmill, Lt.-Col. W. HSmiles, Lt.-Col. Sir W.
Challen, C.Lambert, Hon. G.Smith, E. P. (Ashford)
Clarke, Col. R. S.Lancaster, Col. C. GSmithers, Sir W
Clifton-Brown, Lt.-Col. G.Legge-Bourke, Maj. E. A. H.Snadden, W. M
Crosthwaite-Eyre, Col. O. E.Lennox-Boyd, A. T.Spearman, A. C. M.
Crowder, Capt. John E.Lindsay, M. (Solihull)Stanley, Rt. Hon. O.
Cuthbert, W. N.Lipson, D. L.Stoddart Scott, Col. M
Darling, Sir W. Y.Lloyd, Selwyn (Wirral)Strauss, Henry (English Universities)
Davidson, ViscountessLow, A. R. W.Stuart, Rt Hon. J. (Moray)
De la Bere, R.Lucas-Tooth, S. H.Studholme, H. G.
Digby, Simon WingfieldLyttelton, Rt. Hon. OSutcliffe, H.
Dodds-Parker, A. DMacAndrew, Col. Sir CTaylor, C. S. (Eastbourne)
Donner, P. WMcCallum, Maj. D.Taylor, Vice-Adm. E. A. (P'dd't'n, S.)
Dower, Col A. V. G. (Penrith)McFarlane, C. S.Thomas, Ivor (Keighley)
Drewe, C.Mackeson, Brig. H. R.Thorneycroft, G. E. P. (Monmouth)
Dugdale, Maj. Sir T. (Richmond)McKie, J. H. (Galloway)Thornton-Kemsley, C. N.
Eccles, D. M.Maclay, Hon. J. SThorp, Brigadier R. A F
Eden, Rt. Hon. A.MacLeod, J.Touche, G. C.
Elliot, Lieut.-Col. Rt. Hon WalterMacmillan, Rt. Hon. Harold (Bromley)Turton, R. H.
Fleming, Sqn.-Ldr. E. LMaitland, Comdr. J. W.Tweedsmuir, Lady
Fletcher, W. (Bury)Manningham-Buller, R. EVane, W. M. F
Fox, Sir GMarlowe, A. A. H.Wadsworth, G.
Fraser, H. C. P. (Stone)Marshall, D. (Bodmin)Ward, Hon G. R.
Fraser, Sir I. (Lonsdale)Mellor, Sir J.Wheatley, Colonel M. J. (Dorset, E.)
Fyfe, Rt. Hon. Sir D. P. M.Morris, Hopkin (Carmarthen)White, Sir D. (Fareham)
Galbraith, Cmdr. T. D. (Pollok)Morrison, Maj. J. G. (Salisbury)White, J. B. (Canterbury)
Galbraith, T. G. D. (Hillhead)Morrison, Rt. Hn. W. S. (Cirencester)Williams, Gerald (Tonbridge)
Gammans, L. D.Mott-Radclytffe, C. E.Willoughby de Eresby, Lord
Gates, Maj. E. E.Mullan, Lt. C H.York, C.
Glyn, Sir R.Neven-Spence, Sir BYoung, Sir A. S. L. (Partick)
Gomme-Duncan, Col. ANicholson, G.
Gridley, Sir A.Noble, Comdr A. H. PTELLERS FOR THE NOES:
Grimston, R. V.Nutting, AnthonyMajor Conant and
Hannon Sir P. (Moseley)Odey, G. WLieut.-Colonel Bromley-Davenport