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Cinematograph Film Production (Special Loans) Bill

Volume 496: debated on Thursday 28 February 1952

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Question again proposed, "That the Bill be now read a Second time.

6.12 p.m.

As I was saying before the intermission, it is important that we should have in mind our objectives as far as this industry is concerned. I was drawing attention to the fact that it is not like an ordinary industry, and because it serves so many national purposes the country is vitally interested in its success.

There is no doubt that, during the last few years—indeed, perhaps during the whole of its history—it has had a very chequered career, and that is on account of the very special conditions which prevail here. During the debate this afternoon, we have heard how different this industry is from the great American film industry. Because of our small population and the conditions prevailing in this island, we are not in a position to compete with our American film friends as effectively as we might otherwise be able to do, and therefore it is essential that the Government should consider themselves as partners in this industry. They should encourage it, help to finance it and see that standards are observed, and they should also see to it that, when a body of highly skilled people are gathered together, they have some measure of security.

As a matter of fact, today there is no inducement whatever for a young man or a young woman to enter this industry. They do not know what kind of a career they may have. They know that, if circumstances are against them, their careers may be cut short right in middle life, when they may have entirely to re-orientate their lives and find another method of livelihood, as many people in the film industry have done during the last year or so.

There is no doubt that, although we realise the special circumstances, we cannot sustain the conditions which prevailed in the peak year of 1947, but it ought to be possible for us to have a stable industry, which would give security to the technical people who are involved in the day-to-day operations of that industry.

Today it is no exaggeration to say that there are thousands of highly qualified technicians languishing in idleness, and this country has to face that situation, because it is important that we should have our films on the screens of the world. We have all manner of foreign films shown on our screens, and it is only proper that the people in other countries should have opportunities of seeing the kind of films that we produce, which portray our way of life.

This brings me to the closing down of the Crown Film Unit. I most sincerely believe that that proposal is a very grave mistake. I am sure that, in our efforts to make economies, we may make money savings at the expense of our national prestige and of the great, services which we have built up over the years. Once having disbanded this Unit, it would be almost impossible to recreate the conditions under which it grew.

I well remember the conditions when this Unit was functioning under the auspices of the Empire Marketing Board. It did some first-class work in those years, and then, with the closing of that great experiment, the work was carried on by the Post Office Film Unit. Many well known films were produced, such as "Drifter," "Night Mail" and "North Sea," classical examples which are part and parcel of our educational system. It seems to me that it is a terrible thing that this Unit, having such a fine record behind it, should be closed summarily in this manner.

I do not want to interrupt the hon. Gentleman if I can help it, but I do not think that the Crown Film Unit comes within the ambit of this Bill, which, as I read it, merely extends the scope of the financial assistance to other bodies engaged in the film business. I do not object to the hon. Gentleman making a reference to it, but that is not a matter which we can pursue very far here.

I apologise, Mr. Speaker, but I really thought that I had the liberty to refer to this subject, particularly in view of the fact that almost every speaker —in fact, I think, every one—has already referred to it, almost extensively. I believe that the way in which hon. Members got over their difficulty was by saying that they were hoping that the National Film Finance Corporation would see to it that it incorporated either the work or the organisation of this Unit, which has had such a valuable record in the past.

I will only say that I ask the hon. Member and other hon. Members who may speak to have a little regard for my susceptibilities.

I bow to your Ruling, Mr. Speaker, and would not dream of trespassing on your good nature.

Finally, there is one other point to which I should like to refer, and I am sure that this will be entirely in order. It concerns the question of financing the National Film Finance Corporation. According to the President of the Board of Trade, the National Film Finance Corporation has already made loans to the extent of £5,200,000, and it has received in repayments the sum of £1 million. It will be some years before a final balance-sheet can be made out.

The money will be coming back all the time. No one knows exactly how the situation stands at the moment, but it seems to me that the addition of £2 million is very dubious in the sense that we are not certain as to the guarantees behind that sum. I think it would be a good thing if we were told how this sum is to be guaranteed. If it is to be raised in the ordinary way, there is no doubt that the banks will be very dubious about lending the money unless there are certain Government guarantees behind the loan. I should be glad if we could be told how these guarantees are to be arranged.\

6.21 p.m.

I am not in the least surprised, Mr. Speaker, that you were startled to find on your return to the Chair that one of the most significant facts about this debate had been that every single back bench Member on either side of the House had made a point of pressing for a reconsideration of the future of the Crown Film Unit. In deference to your Ruling, I shall cut out what I proposed to say on that subject, but I hope—indeed I am sure it will happen—the Parliamentary Secretary will bear in mind the feeling provoked in all parts of the House on that subject. The decision to abandon this Unit, and equally the decision to abandon the main organisation for the distribution of the kind of film the Crown Unit produces is generally regarded by people who know anything about it at all as a serious mistake.

On the merits of this Bill practically everything has been said, and I will not repeat it. I wish only to emphasise one major point which has already been mentioned, the question about how this money is to be raised. I think we must have a firm Treasury guarantee. The hon. Member for Barnet (Mr. Maudling) expressed the hope that we should again attract investors to take the equity risk. Whether that is a good hope or not, I do not know, but I am absolutely certain that there is no prospect of getting private investors to take an equity risk at the present time.

In spite of the great improvement which has taken place in the industry, largely owing to the work of the Film Corporation, I see no possibility of private investments coming back for many years to come. Therefore, I say, let us have a clear statement from the Government that the loans are to be backed by Treasury guarantee, because it is the Treasury which is going to stand the risk anyhow, as the money which will be borrowed under this Bill must rank before the money which has already been lent to the Corporation, as otherwise investors will take no part in it.

Therefore, the Treasury, being the major creditor of the Film Finance Corporation, is already at risk, and it would be much better for them to continue to undertake the risk by giving a guarantee straightaway and so save a substantial amount of interest anyway. Subject to that qualification, I agree with everything that has been said about the Film Finance Corporation and about the necessity for its activities.

Please do not let us think, however, that merely by supporting the Film Finance Corporation and by the sort of action we are taking this afternoon we are going to solve the problems which still lie ahead of this industry. The hon. Member for Barnet touched upon what to my mind is the most serious of all those problems, that of United States competition. The United States, with their huge home market, can look upon this country as being a place where they can get their profit. Their films can come to us at a rate which is almost invariably cheaper than the films produced here. They can be sold to the distributors and exhibitors at a much cheaper rate.

In face of that fact, we shall find it extremely difficult, however much money we provide through the Film Finance Corporation, to get a healthy industry in this country. This may be outside the scope of the Bill, but it is related to it. I see no possibility of making this Bill worth while and getting a really healthy film industry unless we do something to restrict the imports of American films, and not only of American films, but of foreign films generally, as we must to avoid discrimination, by such means as a footage tax or in some other way. I ask the Parliamentary Secretary to consider that possibility and, indeed, to pass the suggestion to his right hon. Friend the Chancellor of the Exchequer. Such a footage tax, I think, is the best way in which we can give the British film industry a real chance to put itself on level terms. Subject to those two considerations, I give a very hearty welcome to this Bill.

6.25 p.m.

Reference has been made to your absence, Mr. Speaker, in the earlier part of the debate as a result of which many hon. Members ranged fairly extensively over the activities of the Crown Film Unit. I shall readily adopt a more rigorous standard of order by making what you said was permissible, a passing reference to it. All I will do is join in what has been said from both sides of the House about the Crown Film Unit and say that, in the light of what has been said, what was hitherto a shortsighted, petty meanness now becomes a flouting of the wishes of the House.

I am very glad to find the President of the Board of Trade in his place as well as the sterner and less flexible-minded representatives of the Treasury, so that they may hear the views of the House on the subject. I hope the right hon. Gentleman will take note of the wise utterances of a non-party character which have been made from all parts of the House, and had there been a Liberal representative present, I am sure he would have joined in what has been said on this matter. My relations with the Liberal Party suggest something more than a geographical or topographical association. Of course, I have no authority to speak on behalf of that distinguished party, but, as I say, I am sure they would wish to be associated with the views which have been expressed.

It is true, Mr. Speaker, that you would possibly have been shocked at the wide view which your predecessor in the Chair took of the Rules of Order on this matter; but you would have been more shocked to learn that until the present speaker rose there does not appear to have been one disagreeable or discordant word said in the debate. However, I intend to show that when public money is involved, something should be said.

I understand that in 1950, I think it was— I will be perfectly fair to the present President of the Board of Trade—a similar Bill came before the House. On that occasion, I intended to come in and address a few inexpert words of criticism about the whole state of affairs in the film industry. But on that occasion, unfortunately just as I arrived, a couple of million pounds of public money was being nodded away without one voice being raised in protest. I say in all seriousness that something should be said on behalf of those back bench Members whose duty it is to watch that public money is not dispensed in this way.

Something ought to be said to indicate that a good deal less than satisfaction is felt by us about the whole financial set-up of the film industry. We may not be interested enough in it to inquire into it in detail, but as an ordinary back bencher who knows very little about the film industry, I must say that a financial set-up which is kept in being by these repeated shots in the arm is not one that commends itself to me at all.

I am not saying a word about the activities of the Film Finance Corporation itself. I have heard from all sides that this is an efficient and useful body which ought to be kept in being at the present time. I am not saying a word in criticism of or in dissent from the words uttered by the President of the Board of Trade in praise of the activities of the Corporation itself; but it must be wrong to have these repeated descents from the Board of Trade to the House asking for shots in the arm to the film industry—money to be distributed to private firms and entirely outside the control of this House.

I had intended in 1950 to come to the House and warn the President of the Board of Trade that, if another Measure of this kind appeared, I would divide the House. Unfortunately, I was not able to give effect to that warning because the Bill was passed as I entered the Chamber. I should like to know from the Minister who is to reply how many more attempts we are to have at this sort of thing, and the handing over of a few million pounds of money, to the industry, over which we shall have no control. What is wanted is not these repeated shots in the arm, but a policy.

What happens is that when the House votes these sums, it does so to perpetuate the present position and gives the Government of the day more time to think about a policy. We are buying time somewhat expensively by this method of providing a one-Clause Bill for a couple of million pounds. I object to it and I shall protest in far more serious terms —nd I am sure I shall receive the support of many of my colleagues—if any attempt is made to come back again, without any policy or pretence that there has been any policy, for more of these financial shots in the arm. It will be my duty to divide the House and to see that no miscalculation prevents me from exercising that duty.

Part of the bad structure in the film industry at present arises from the fact that when film production started in this country it was often financed in a somewhat Bohemian way. Human artistic activity attracts people to the industry who have little notion of financial matters. What happened was that some wealthy person would put up the money to gain the artistic satisfaction so valuable to a man of culture. I understand that these gentlemen were described as "sugar daddies".

My hon. Friend tells me that the word is "angels". I understand that "sugar daddy" is a term related to a different form of cultural activity. These "angels" were interested in the business not because they thought they would get a higher dividend from their money than if they had invested it, say, in the production of false teeth. They were interested, of course, in the indirect, aesthetic, emotional and cultural satisfaction that derives from close contact in an influential position in this industry.

It seems to me that in the last few years, the supply of "angels" having dried up, a national "angel" has been set up with unlimited funds, and not only does the new "angel" not make a profit, but it cannot derive some of the emotional secondary satisfactions available to the original breed. That the Corporation should take on the rôle of being an "angel" without any stint in its resources seems to me deplorable and dangerous, and there ought to be control by the House.

It is all very well to come here to talk about the necessity of sustaining the film industry and to say how useful it would be for British films to be seen all over the world. Everybody knows about that, as everybody knows about sin. It is not platitudes about films and the value of their being seen in Kenya and the Gold Coast that we want. What we want is to put the industry on its feet and not have a repetition of time-buying at the expense of the taxpayers of this country.

It has become the habit of Ministers on this sort of occasion in connection with the film industry—and it would not be right to blame the present President of the Board of Trade more than his predecessor, for it is customary—to treat this matter with some levity, as I have indicated. They come here for permission to raise money and they do not tell us how the Corporation are going to raise it, and they do not guarantee the money. It would amount to a financial scandal if the Corporation raised this money un-guaranteed at a higher rate than if the Government guaranteed it.

No one, of course, suggests that this Corporation is going to go bankrupt and default or that the Government would not pay up if such an event occurred. Then, of course, the market will be getting a far higher rate of interest than the security warrants. As my hon. Friend the Member for Huddersfield, East (Mr. J. P. W. Mallalieu), rightly said, the Government are at risk in any event, whether they formally agree to meet the obligations of the Corporation or not.

I understand that one of my hon. Friends has expressed himself as rather anxious to encourage wider and more energetic exercise of the power of film censorship. I hope that will not be done except in the case of persons of tender age. I have never been able to see why public money should be spent on censoring films for adults, because it is not true that one can influence the adult mind by showing obscenities. By the hypothesis which warrants film censorship we should have to censor the film censors. If the theory on which they are brought into being is right, they must be the most depraved group of men in the land.

Does my hon. Friend not accept the dogma that better the few should suffer than the many?

If I were certain that the few in question really did arrive at the state of depravity which they ought to be in if their appointments are to be justified at all, I would agree with my hon. Friend, but of course the whole thing is based upon an hypothesis which is pure balderdash. The adults of this country do not need protecting from the grossest obscenities or acts of violence depicted on stage or screen. It is impossible to prove the theory that the adult mind can be depraved by hearing obscene words or seeing obscene images.

Of course, children and impressionable people are totally different propositions. I am not suggesting for a moment that children whose minds are developing should be exposed to all sorts of adult films; but I object in principle to anyone using what is, to me, this deplorable action as an excuse for voicing the view that we should extend the activities of the Board of Film Censors. That may be a useful body, in that it provides a resting place on certain occasions—but I had better not continue in too detailed a manner because I might be unfairly criticising what I have no doubt is a useful body, provided its work is strictly limited. Apart from its being out of order, it surely must be indefensible to urge any extension of it.

In conclusion, I beg the Minister to bear in mind that some of us are still old-fashioned enough to regard a couple of million pounds as a substantial sum —even when it is said quickly—and I do object to the House of Commons being treated in this way and being asked to give these sums from time to time to prop up a badly arranged structure—something which should have been put right years ago and which urgently needs a policy. I do urge that a policy be developed.

Nothing that I have said is intended as a reflection upon the Film Corporation and the fine work it is doing. I hope its work will be perpetuated.

Notice taken that 40 Members were not present:

House counted, and 40 Members being present

6.43 p.m.

Of the various cuts we have been hearing about it has always seemed to me that the most serious were the cuts in capital expenditure. Since the war this country has faced a number of crises. Those crises arose inevitably out of the unbalance of world trade. We overcame them, each in turn, through an expanding economy, which was based upon a high level of capital expenditure—a level of capital expenditure which was more than double the pre-war expenditure.

Now, for the first time, we are having a cut in capital expenditure. Capital which is required by our own industry if production is to increase is being exported. Another example of capital cuts is education. It is a process of selling the future in order to get out of an immediate difficulty—the sort of thing which happens when farmers sell their seed corn. It may save them for the day; it may save them for the morrow; but it means that a crack becomes utterly and completely inevitable.

When we are having these capital cuts, is it justifiable to provide capital for this particular industry? When one is economising on capital in productive industry—the capital which is to produce a crop in terms of production—are we really justified in making additional capital available here? It does not really matter whether this capital is provided directly by the Government or by the City of London.

As "The Times" observed this morning, one of the great discoveries the Conservative Party have made is that we are living in a planned economy—in a welfare state—and the Chancellor of the Exchequer has certainly made it very plain that he is conducting the finances of this country upon the basis of a planned capital expenditure. The money to be provided here comes out of the fund which is available for capital expenditure.

Capital which is spent here is capital which cannot be spent somewhere else; it is capital which cannot be spent upon the machines which industry is lacking or on the development of marginal land —which can only be done at public expense and would increase our food production—or on the next generation, which is perhaps the most important of all our capital expenditure in terms of the future productivity of the country.

The situation today is quite different from that envisaged when this Corporation first saw the light of day. It was created to deal with an emergency. In 1947 and 1948 there was a 75 per cent. tax on imported films, which resulted in a strike of the American film industry. Something had to be done if the whole industry was not to collapse, and £5 million was provided to meet that immediate emergency.

In those circumstances I feel it was a very good investment. It certainly brought us some very fine films. Some of it was used directly on the production of films, and I think I am right in saying—the President of the Board of Trade will doubtless correct me if I am wrong—that it was responsible for those documentaries—the productions of the Crown Film Unit—which gave us a lead and won us the admiration of the whole world. That was a contribution, not in a financial sense, perhaps, but in an educational and artistic sense, which was possibly the best and most productive thing the film industry ever did.

Apart from these ventures in which direct finance was involved, the investment was carried out largely through the British Lion Film Corporation and a series of really quite outstanding films were produced. We all remember "The Third Man." That was a result of this original expenditure, and I believe it won for the British film industry the highest awards in the world. The film was so outstanding that it even got the American awards.

That was not the only film. We had "Tales of Hoffmann" which was, I think, the first effort made to use the medium of the film for the presentation of ballet. It was a great artistic success. Again, we have "The Outcast of the Islands," which is showing at present—a remarkable film from the Conrad story. There was "The Winslow Boy" and, light entertainment, "Maytime in Mayfair"—remarkable films and remarkably successful films. But, in spite of this series of winners, the money ran out; and we should be optimistic if we imagined that we could go on getting such a series of winners as that.

With all these successes, still it was not sound in a financial sense. The money was running out, and in 1950 the Corporation had again to come to the House for additional assistance—another £1 million—and again for another £2 million. How long is this to continue? Perhaps the President, or whoever is to reply from the Board of Trade, will tell us this: do they consider that there is any prospect of this money coming back? We have written off £5 million, then another £1 million, and now another £2 million—all this money going in and in and in; and where is the return? And this at a time when capital expenditure is being cut everywhere!

Lord Woolton asked us to cut capital expenditure in 1947. We refused to do so. We expanded capital expenditure, and the result was that we built and built and built production—and that building up of production enabled us to meet the crisis. That is the expansionist method of meeting crises. Now we have the Tory Party, with its traditional idea of meeting crises not by expanding but by cutting back. The previously mounting production figures are beginning to fall away, and they will fall away even more in the future because the Government are cutting back capital expenditure. Yet here, capital which is so urgently needed, and which everywhere else is being cut back, is being provided for a purpose which continuously seems to have been unproductive.

We had the Eady scheme which, if hon. Members have forgotten, was a means of trying to provide the finance for producing films from the people who watch films. That is to say, it was a levy on the tickets bought by the film-going public, and the levy went back to the producer in order to obtain production. That seemed a reasonable, co-operative sort of way of solving the problem.

Will the Minister tell us whether that scheme is working and why that sort of method is not followed, because it appears to be a method of getting money direct from what I think must be described as a luxury level of expenditure, even though it is the luxury of many poor people. It is, nevertheless, a collection of spending money for this capital purpose. What has happened to the Eady scheme? How is it getting on?

I believe that the proposal we have before us tonight did not originate with the present occupant of the Board of Trade. It originated, I believe, with his predecessor. But that was in an atmosphere of expansion, when we had an expansionist Labour Government. How can hon. Gentlemen opposite regard this Bill as consistent with their policy? How do they relate this provision of money to the fact that in other, more vital matters expenditure appears to be cut back?

It is a curious thing that, when we have a Conservative Government in power, there is no money for the people who need it. There is no money for the education of the poorest children. Expenditure on those things is to be cut back. But there is money for the rich; there is money for the film producers and for the brewers. Expenditure can be afforded in that direction, whereas what appear to us to be greater interests pass and are forgotten.

Next, about the Treasury guarantee. Surely this is the greatest absurdity and the greatest hypocrisy. Everybody knows that the Government have to stand by this money because of the nature of the structure of the Corporation. The Government are, in practice and in fact, guarantors of the Bill, but if they hold back their formal guarantee there can be only one result—somebody will get more interest. Can we have an assurance on this point? We have these little side turns. First it is on public houses in the new towns, and now this Bill—all these little side bits going to the sort of people who produce the Woolton millions. How long are we to have that sort of thing? Surely this little interest game has gone far enough.

Finally, as nobody has mentioned this before, I feel that something should be said in tribute to the work of Lord Reith on this Corporation. He did a remarkable job of public service. Indeed, he has done many remarkable jobs of public service and I feel we should express some gratitude to him for what he has done in this matter.

6.58 p.m.

We have heard an interesting debate in which, until the speech of the hon. and learned Member for Northampton (Mr. Paget), there had been uniform support for the Bill. I am sorry that the hon. and learned Member was not able to be present when the opening speech in the debate was made by my right hon. Friend, nor when the first speech was made from the Front Bench opposite. Had he heard' those two speeches, I think he would have heard the answer to some, at any rate, of the points which he raised. Nevertheless, the House will not wish me to repeat the matters into which my right hon. Friend went, but will rather expect me to attempt to answer some of the questions which have arisen in the course of the debate.

I do not wish to weary the House, especially since there appears to be virtual unanimity in the desire to give the Bill a Second Reading. The right hon. Member for Colne Valley (Mr. Glenvil Hall) asked various questions about the Bill itself. I sympathise a good deal with one of his questions, because exactly the same question occurred to me when I first read the draft. What is the significance and importance of Clause 1 (2)? The necessity for that arises as a result of paragraph 8 of the Schedule to the Act of 1949. That provides for what is to happen if, at any time after the expiration of five years from 9th March, 1949, the Treasury decides to dissolve the Corporation. There is then provision for the transfer of assets and liabilities, and there would be a contingent liability to be accepted by the Crown.

This is a legally necessary subsection to make it clear that the liabilities that would be dealt with under the provisions of that paragraph of that Schedule would include any sum outstanding of the moneys with which we are now concerned in this Bill. The right hon. Gentleman asked me whether such a sum would rank in front of or behind such sum as might be outstanding of the other £6 million. The answer is that the whole of the liability would rank pari passu.

I would remind the House that what this Bill provides for is borrowing from persons other than the Board of Trade with the consent of the Board of Trade and the Treasury. It does not provide for raising any equity capital. It is loans with which the Bill deals; but it is loans from people other than the Board of Trade. It is not Government money that they are here encouraged or entitled to borrow; but, as my right hon. Friend pointed out, that does not exclude the possibility of a Government guarantee. There is no mention of a guarantee in the terms of the Bill itself, because that is fully provided for, as the right hon. Gentleman will know from his days at the Treasury, under section 2 of the Borrowing (Control and Guarantees) Act, 1946.

I think that the right hon. Gentleman and other hon. Members have raised the question whether this money could be raised from other sources without a Government guarantee, or whether a Government guarantee was necessary or desirable. In the view of the Government, it would quite clearly be preferable to raise it without a Government guarantee if that could be done, because it is the desire of this Government—and here, I think, we agree with what was the desire of the preceding Government—that this industry should not permanently rely on moneys from this Corporation but should eventually become self-supporting. Therefore, if it proved practicable to raise money without a Government guarantee, in the view of the Government that would be preferable.

A point arises out of what the hon. and learned Gentleman has just said that alarms me a great deal. Will he, if he is now authorising the borrowing of money from private sources without a guarantee, make it plain to the lenders that the Government are not in fact going to pay this money if default is made?—because that would be making the worst of both worlds. If that position were taken up, I suggest to him that then they would not get a farthing from private sources—unless the Government were behind the loan.

People who lend money are quite capable of ascertaining for themselves the legal position. They can examine and will, no doubt, examine these Measures passed by Parliament. But if the hon. Gentleman is asking me whether the Government have the same liability on a loan, whether or not they give a guarantee, the answer, as he well knows, because he belongs to the legal profession, is "No."

The right hon. Gentleman opposite and many others have raised a point about the life of this Corporation. If the right hon. Gentleman will refer to the paragraph of the Schedule which I have already mentioned, he will see that there is, of course, nothing compulsory about the winding-up of the Corporation at the expiration of that period. The loans have to be made within the stated period, but whether or not the Corporation is dissolved is, under the Act passed by the Government of which the right hon. Gentleman was a distinguished member, a matter to be decided by the Treasury.

I am sorry to interrupt, and I am grateful to the hon. and learned Gentleman for giving way. I should like to make this point. The whole purpose of the Act is to lend money over a period of five years. Once the five years have elapsed, namely, at 9th March, 1954, the Act, in a sense, becomes useless. Its only purpose and usefulness thereafter is to collect moneys that may be outstanding. Well, that is a very useful function for any corporation to perform, but the real function of the Corporation, and its right to exist, is centred in the fact that it carries on business either as a bank or as a company or as an organisation advancing money for the making of films.

I am afraid I am speaking at greater length than I expected in this intervention, but the point we are trying to make on this side of the House is that we all want this to go on; and we were urging the Government to come to some decision well before March, 1954, in order that the Corporation and the industry and everyone concerned should know where they are.

I am obliged to the right hon. Gentleman, who made a useful speech, and certainly need not apologise for any intervention to clarify any matter. I agree with him about looking ahead. Looking ahead is very much needed in this industry. There is, however, no need now to provide for any amendment to this paragraph in the principal Act or to go beyond what we are now doing in this Bill. But in so far as the right hon. Gentleman is making a plea for looking ahead, I agree.

The right hon. Gentleman asked whether all this money need be raised at once. Certainly not. There is no need for that at all. This sum is a permitted maximum. What will actually be required, and when it will be required, will depend on many factors—among other things, on how the revised Eady scheme works out. It may be that things will work out in such a way that the whole of this sum will not need to be borrowed at all, but it is because we want to enable the Corporation to plan ahead that we have come to the conclusion—which is the same conclusion as that reached by our predecessors in that matter—that permission to borrow this additional sum—the ability to borrow it —is advisable and necessary.

The right hon. Gentleman was the first of many to mention the Crown Film Unit. It was when you, Mr. Speaker, were not in the Chair. You have already pointed out, as it would have been pointed out in any event if a Minister had gone outside the scope of the Bill, that that is really quite outside this Bill. Nor, indeed, as the right hon. Gentleman with his Ministerial experience knows, is that particular matter one for the Board of Trade at all. It is both outside the Bill and outside the function of my Department.

My hon. Friend the Member for Southgate (Mr. Baxter), who welcomed the Bill and welcomed the great progress that has been made in this industry from the days of wild extravagance, made, as he always does, an entertaining speech. When my right hon. Friend mentioned the book "Nobody Ordered Wolves," I heard a whisper from the right hon. Member for Colne Valley (Mr. Glenvil Hall) that there was a lot of truth in it. I am bound to say that I received the same advice many years ago from a professional friend who had been engaged for some days in some film litigation, and who told me that, if I wanted to understand the industry as it then was, the quickest way to learn was to read "Nobody Ordered Wolves."

I welcomed what was said by hon. Members in all quarters about the Corporation, which we are empowering to borrow a further £2 million by this Bill, having done a great deal in reducing waste and remedying those extravagant ideas. Since competition with other countries has been mentioned, I would say, although I am not very expert or a frequent filmgoer, that I think that the best British films are as good as any that I have had the good fortune to see; and the best are not necessarily the most lavish.

The hon. Member for Lichfield and Tamworth (Mr. Snow) wanted us to give guidance to the Corporation on the sort of film that they should encourage. I am sure that we ought not to do that. Nor do I think that the Corporation should do very much in guiding the producers in that way. Producers should have a very great measure of liberty, though I think that the Corporation has been able and will continue to be able to improve business methods and finance. I do not believe that either the Board of Trade or this Corporation would be the proper guide to say what sort of film should be produced to satisfy the public taste.

I was a little astonished when the hon. Member for Lichfield and Tamworth dealt with the subject of censorship, and I must say I thought he was lucky that his hon. Friend the Member for Devon-port (Mr. Foot) was not in the House. He would certainly have quoted "Areopagitica"—as, indeed, I am tempted to quote it now. I think perhaps, on second thoughts, I had better not deal with that subject at all, because it is wholly outside the present Measure.

Perhaps I am a little out of order in saying this, but I did get a whisper that the Minister took that view of my remarks. In case I did not make myself clear, I should like to do so now. All I was asking was that the code issued by the British Board of Film Censors should be publicised and should be issued, not only to producers, but to local licensing authorities, so that the electors could judge whether the code, which is a very good code, was being properly enforced.

I note what the hon. Gentleman has said. I always listen to him with interest because we share a passion for Georgian architecture—which may perhaps not be very relevant at this moment. It is about as relevant as censorship to the work of the Board of Trade and to this Bill.

My hon. Friend the Member for Barnet (Mr. Maudling) had something to say in favour of the chief change in the method of raising money in this Measure as contrasted with previous Measures, namely, seeking to get private finance interested. He was, however, in error if he thought that there is anything to do with equity capital in this Bill.

A question about how the Eady plan was working was put to me by the right hon. Member for Colne Valley and others, including the hon. and learned Member for Northampton (Mr. Paget). The revised Eady plan has only been in operation since 5th August of last year, and it is perhaps a little early to be very definite. The best estimate we can make today is that we believe it will bring in for the producers between £3 million and £3½ million in a full year.

The hon. Lady the Member for Flint, East (Mrs. White) asked me to say a word or two about the group system. The description of the group system is available in a public document, namely, in Appendix C to the Report of the Corporation for the year ending 31st March. 1951, but I can give a few figures of the number of films in each group that have so far been helped by the Corporation: nine films in Group 1, four films in Group 2 and five films in Group 3. This group system has not, I think, been in operation for a sufficient time to make any final assessment on how beneficial it is, but no doubt the House will read with interest the next Report of the Corporation when it comes out.

The hon. Lady also asked me about the loan to British Lion. The Corporation started off with this commitment of £3 million, half of the hitherto authorised total of loans, in respect of British Lion. That debt of £3 million has not been repaid; nor has it been added to. The indebtedness of British Lion stands today at £3 million.

Discussions are proceeding between the Corporation and British Lion to see what is the best method of securing such repayment as may be possible. Those discussions are now proceeding. My hon. Friend the Member for Cheadle (Mr. Shepherd) rightly drew attention, as indeed did the right hon. Gentleman and others, to the great importance of continuity and ability to plan ahead. That was the case for the principal Act, for the amending Act and for this Bill. That is the object of these measures. I think that I have dealt incidentally with the point raised by the hon. Member for Greenwich (Mr. Reeves), who spoke about borrowing equity capital. I have pointed out that this Bill deals only with loans.

The hon. Member for Huddersfield, East (Mr. J. P. W. Mallalieu) also asked a question about finance, and he raised some of the points on borrowing with or without a Treasury guarantee. I think that I have answered him incidentally in dealing with the point raised by the right hon. Member for Colne Valley.

The hon. and learned Gentleman certainly referred to it, but I am not clear that he has answered it. It seems to me that it will be quite impossible to borrow this money without a Treasury guarantee. It really will not work.

I should like the hon. Member to consider whether we are not right in thinking that, if this Corporation could raise the money without a guarantee, that would be better in the permanent interests of the industry. I am sure the hon. Member will not expect me to express a view which I do not hold, namely, that it will necessarily be impossible for this Corporation to borrow money without a Treasury guarantee. My right hon. Friend and I have pointed out that it will be possible for the Treasury to give a guarantee, if it is thought right, under the powers of the 1946 Statute, and my right hon. Friend does not exclude that possibility. But it is my conviction that we should not be serving the interests which we all wish to serve in this matter if we assumed, in advance, that borrowing would be impossible without a guarantee.

I should have thought that that was a fair assumption in the next few years. For the rest, I can understand the hon. and learned Gentleman's argument if it is suggested that the industry itself was going to borrow the money, but it is not the industry which is going to borrow it. It is what amounts to a Treasury Corporation. The Treasury is behind it. Let us say flatly that it is behind it.

I agree that there is an interesting argument on this point, though, perhaps, it is not entirely a Second Reading point. The view which Her Majesty's Government hold is that it is in the interests of the industry that we should start what has already been in contemplation by every Government which has done anything for this industry, namely, progress to the state where the industry can be self-supporting and does not have to seek Government help. I believe, therefore, that this difference between this Measure and the previous Acts is one for which an argument can be put up, though I appreciate that there can be differences of opinion on the point.

The hon. Member for Cheetham (Mr. N. H. Lever) showed a rather refreshing concern for public money. He was not quite right in saying that this Bill provided for the expenditure of £2 million of public money. Nevertheless, I was so delighted with his concern for public money, which we do not always find in the party opposite, that I welcome that attitude, and the Government note that, if it is ever necessary, in the opinion of the Government, again to introduce such a Bill, he has given notice that he will divide the House against it.

The hon. and learned Member for Northampton, who alone spoke in opposition to the Bill, asked one question. Incidentally, he credited this Corporation with the high quality films which he said were produced by the Crown Film Unit. This Corporation has never dealt with the films of the Crown Film Unit at all. He then asked whether the Government expect to get back the moneys dealt with in this Bill and in the previous Acts. The answer is that we certainly expect to get some of it back—indeed, a large part of it—though I certainly shall not commit myself to the view that we shall get it all back. I am quite certain that our chances of getting it back will be much greater if this Measure is passed, than if this Measure had not been introduced.

Whatever might have been done had we started afresh without any previous legislation, I believe, having regard to the previous history, that this Measure is right now even on grounds of Government finance. That is our belief. I think I have dealt with the questions raised by various hon. Members, with the exception of those which were clearly beyond the scope of this Bill and in respect of which, if I were to reply to them, I should be out of order. I ask the House to give this Bill a unanimous Second Reading.

7.26 p.m.

I apologise to the President of the Board of Trade for being unable to be present this afternoon when he opened this debate owing to duties elsewhere. However, I have just read a considerable Teport on the tape machine in another part of the House referring to the Crown Film Unit and I felt that it was perhaps my duty to come into the Chamber to see how that subject was faring.

I have already ruled that the Crown Film Unit does not come within the scope of this Bill. The purpose of this Bill is to provide finance for a corporation which does not control the Crown Film Unit, and I have already checked hon. Members from making more than a passing reference to the Crown Film Unit.

That is why I was rather mystified, when I heard your Ruling earlier as I sat listening to this debate, Mr. Speaker, for I was drawn to the Chamber when I read extracts from Members' speeches on the tape machine referring to the Crown Film Unit, and I must say that I am in somewhat of a predicament in finding that your Ruling conflicts with history which is recorded on the tape machine elsewhere. But I have no intention of doing other than making a passing reference to the Crown Film Unit and perhaps using it as an illustration of one or two points which I will make later in my speech.

Before I attempt to trespass in any way upon your generosity, Mr. Speaker, I want first of all to deal with the question of finance to which this Bill relates. It is well known that the original Measure was introduced by the Labour Government to deal with a problem in the film industry, and I wish to reinforce what has been said by some of my hon. Friends about the method of finance adopted in this new Measure.

Why is it that Her Majesty's Government are departing from the precedent laid down in the Measure of the previous Government? Having listened to the film industry's case, and having appreciated that in the present situation they needed help, we thought it right to make that help available to them as cheaply as possible through the Treasury. Nothing that the Parliamentary Secretary has said has done anything to convince me other than that was the right method to pursue. I should like an assurance from him, and it ought to be made clear during the Committee stage, that if the Government are going to depart from what I regard as the best principle, namely making this money available through the Treasury, then at least the Government ought to give a guarantee on this £2 million overdraft in order that the money can be obtained as cheaply as possible.

Why is it that the President of the Board of Trade refuses to give the assurance that there will be a Government guarantee, because he knows, as well as I and all other hon. Members know, that that will make a considerable difference to the terms upon which this money can be borrowed? Perhaps the Parliamentary Secretary will say now whether or not he agrees with my contention that without some form of Government guarantee this £2 million will be borrowed at a higher rate of interest than it could be borrowed if it had that guarantee. Since he does not care to make any intervention in response to my invitation, I can only conclude that he has not followed my argument.

I did not get up to reply to this debate until no one got up on the opposite side of the House. I then endeavoured to deal, I hope with courtesy, with such questions as had then been asked. I have now exhausted my right to speak, and so has my right hon. Friend, and neither of us intends to ask the House to give him leave to speak again.

In response to that, I can only say that I was in the House well before the hon. Gentleman got up to reply to this debate. It was as a result of a conversation with a right hon. Friend on the Front Bench, who told me that it might be appropriate for the Parliamentary Secretary to get up to deal with some of the points made in the debate and there was no reason at all, as I well understand, why I should not continue the debate if I was not altogether satisfied with the reply we had received, that I am dealing with the point upon what I think all my hon. Friends on this side of the House are not at all satisfied.

Why is it—and I do not mind whether the hon. Gentleman replies now or whether his right hon. Friend seeks the indulgence of the House to reply, because these matters go down on the record and the public can judge for themselves—the present Government have departed from the principle laid down by the previous Government that this money should be made available to the film industry as cheaply as possible through the Treasury? Why is it that one of their first acts on coming into power is to throw back to private enterprise the opportunities for such capital investments as this?

I say, yet again, that the Parliamentary Secretary knows, as well as I do, that if he is throwing it back to private enterprise without any Government assistance or guarantee, the £2 million will cost more to borrow than it would have done had it been made available through the same channels as were operated by the previous Government, so I hope that they will change their mind. But, I must admit, when looking at the faces of hon. Members opposite, there is not the slightest prospect of their altering their minds on this issue, because they are committed to allowing private enterprise to find this money at a high rate of interest, just as they were committed yesterday to handing back their public houses to private enterprise, and, at the Election, to handing housing back to private enterprise.

Nevertheless, I think that we on this side of the House have a duty to keep reiterating our demand, even if it is not appreciated by hon. Members opposite, that when we see a necessary operation, as we all agree this is, which should be carried out, then it should be carried out properly and cheaply through Government funds being nude available. We hope against hope that during the Committee stage the Government may be won over to making a somewhat clearer pronouncement of their attitude in regard to how this £2 million is to be raised.

I am aware that it would be out of order to deal in any detail with the position of the Crown Film Unit, but I think I may be allowed to express in passing my astonishment at the fact that the Government are prepared to allow £2 million to be raised for the Film Corporation to be used generally by the film industry and yet are not prepared to find £250,000 a year to keep the Crown Film Unit going, because I feel—and I think that my feeling is shared by most hon. Members in this House and certainly by the public at large—that £250,000 a year invested in the Crown Film Unit produces a far bigger return to the country than £2 million made available for general dispersal throughout the private him industry as a whole.

I think that the Government are making a colossal mistake in trying to disband the arrangement made for the films of the Crown Film Unit to be shown to specialised audiences throughout the country Only the other day I had a letter from a business man who is a friend of mine—and in case hon. Members opposite think that he is a Socialist I will, without giving his name, mention that he stood as Liberal candidate at the two previous Elections— who expressed his very real regret that it would no longer be possible to receive films on time and motion study and matters of that sort which the workers at his factory had certainly enjoyed, and from which they had benefited by the Crown Film Units taking these films to his factory.

It is deplorable that even at this difficult time in the affairs of the nation, the Government should be willing to allow all the good work of the Crown Film Unit and the Central Office of Information to be swept away for the sake of £250,000 a year, when they are bringing this Bill forward and asking for another £2 million to be made available to the private film industry. Although I realise that it is absolutely hopeless, I go out of my way at this early hour to plead with the Financial Secretary, who is sitting opposite and looking very jovial, to reconsider this matter. How can he look so happy when one of the first acts in which he has participated has been to destroy this very valuable Crown Film Unit, and when he must, by virtue of his office, know some of the dark secrets to be given to this House on 11th March. It is significant of his joviality that, having carried out or prepared these dark deeds, he should have the affrontery to come down to this House and still look happy about them.

I make one final plea to the Government. We all agree with the necessity for this Measure, but we think that the £2 million ought to be provided through the same channels as were made available for the funds which were previously provided; and, above all, I ask the President of the Board of Trade to speak with his colleagues in the Cabinet and to stress upon them, as has been done by so many hon. Members here today, that this is a bad move for the country as a whole. It is hitting at the information and instruction services that can be given to specialised and to general audiences in the country if they allow the Crown Film Unit to pass away merely for the sake of £250,000. I would like to ask him, on some other occasion, how much capital equipment is being discarded.

The hon. Member's references to this matter do not justify the use of the adjective "passing."

I accept your rebuke, Mr. Speaker. I started off with a few passing references, but this subject is so near to my heart and, in my view, so important that I perhaps got carried away and delved more deeply into it than I should have done. I hope as a result of my remarks, together with those of my hon. Friends, we have succeeded in penetrating the jovial exteriors of the President of the Board of Trade and the Financial Secretary, so that they will think deeply about this matter and pass on their observations to their more important Cabinet colleagues, so that we may hope that before the Budget passes through its final stages the country will have the great joy of learning that the Crown Film Unit has been saved from the spoilations of the new Government.

7.40 p.m.

I just want to answer the speech of the hon. Member for Wandsworth, Central (Mr. Adams). I have heard many speeches from hon. Members opposite but I have seldom heard anything which has so little relation to the facts.

There has been no return whatsoever upon the £6 million spent by the late Government. The Government were charged with the duty of seeing that the money spent out of the £6 million was returnable on every single firm venture which was embarked upon. However, they failed to obtain any return whatsoever, and the whole of the £6 million has gone. What we are trying to do in the Bill is to remedy the situation left to us in which a great deal of public money has been wasted. There is no hope of the return of that money. Now we want to put the film industry on a proper commercial basis by ensuring that when it wants to borrow money it shall do so at proper terms from people who will expect a return.

The trouble is that during the last six years hon. Members opposite wasted public money and left nothing to show for it. No hon. Member opposite, particularly if he reads the Reports of the Public Accounts Committee, can say that there have been any returns on the £6 million or any chance whatsoever of a return. Now we have the sensible situation that such money shall be borrowed and shall be repaid. We have at last got away from the sort of thing that happened so often during the lifetime of the Socialist Government, when money was borrowed on some pretext or another and was never repaid.

I hope the House will give the Bill a most warm Second Reading, because it at last shows an element of honesty in what has heretofore been merely a matter of borrowing money without there being any intention that it should be repaid.

Question put, and agreed to.

Bill accordingly read a Second time.

Committed to a Committee of the whole House.—[ Mr. Oakshott.]

Committee Tomorrow.

Cinematograph Film Production (Special Loans) Money

Considered in Committee of the whole House under Standing Order No. 84 (Money Committees).—[ Queen's Recommendation signified.]

[Colonel Sir CHARLES MACANDREW in the Chair]


That, for the purposes of any Act of the present Session to empower the National Film Finance Corporation to borrow otherwise than from the Board of Trade, it is expedient to authorise the payment out of moneys provided by Parliament of any increase attributable to the said Act in the sums which, under paragraph 8 of the Schedule to the Cinematograph Film Producton (Special Loans) Act, 1949, are payable out of moneys so provided.—[Mr. P. Thorneycroft.]

Resolution to be reported Tomorrow.

Industrial And Provident Societies (No 1) Bill

As amended ( in the Standing Committee) considered; reported, without Amendment; read the Third time, and passed.