House Of Commons
Friday, 4th April, 1952
The House met at Eleven o'Clock
[Mr. SPEAKER in the Chair]
Sterling Area (Gold And Dollar Reserves)
With permission, Mr. Speaker, I should like to make a statement on the gold and dollar position during the past quarter.As I announced in my Budget speech, the gold and dollar deficit of the sterling area amounted to 299 million dollars in January and 266 million dollars in February. In March it was 71 million dollars, making a total for the first quarter of 636 million dollars. This compares with a deficit of 940 million dollars in the fourth quarter of 1951, which included payment of the 176 million dollars in service of the United States and Canadian lines of credit. Receipts under the European Recovery Programme were 1 million dollars during the first quarter. The gold and dollar reserves, therefore, fell by 635 million dollars, and at the 31st March stood at 1,700 million dollars. This has resulted in a further accumulation of sterling in the Exchange Equalisation Account and a sum of £300 million will be returned to the Exchequer in the near future. In opening my Budget, I stated that we could confidently rely upon a considerable reduction in the rate of loss during the following weeks. As the House will see from the figures I have quoted, the loss in March was greatly reduced. In considering the figure of 71 million dollars for the deficit in March, the first thing that must be noted is that our E.P.U. settlement was 50 million dollars as against 94 million dollars in February. Secondly, there has been a concentration of special receipts and earnings in March of approximately 75 million dollars. These transactions include the special sale to us of gold by South Africa amounting to 28 million dollars. This is a contribution from South Africa towards meeting our present difficulties, and I express our warm thanks to the South African Government and Mr. Havenga in particular for the generosity and understanding which have led them to take this most helpful action. Then we have received 10 million dollars from the United States under the agreement covering reimbursement to us of gold losses which we incur from the use of existing sterling balances by other members of the European Payments Union. Finally we received about 35 million dollars from special sales of rubber, tin and lead to the United States under our recent commodity agreements. A considerable part of all these receipts is, therefore, non-recurring in character. It can be stated that our receipts, especially in the latter part of the month, benefited from a revival of confidence in sterling which has also manifested itself in the strengthening of the rates at which sterling is quoted in foreign exchange markets. Indeed towards the end of the month our reserves actually rose. But the fact remains that it is our current trade and payments position which is in the long run decisive. Rather than relaxing, we must redouble our efforts. The White Paper on the Balance of Payments for the second half of 1951 will be presented before the House rises today, and copies will be available tomorrow morning.
While the reduction in the deficit in March is, of course, very welcome so far as it goes, and while we must all hope that it is the prelude to a surplus in the next quarter, it is obvious, I think, from the Chancellor's statement, that the position is still serious and bound to give rise to anxiety.I should, therefore, like to ask the right hon. Gentleman one or two questions. First, does he think that we have begun to get the benefit of the cuts in our own dollar imports which have been imposed—are these reflected in the figures he has given us? Second, how far have such cuts been made by the other countries in the sterling area, and shall we get, in the fairly near future, some benefit from action taken by them? Third, will he give an assurance that in discussions about the European Payments Union he will resist any proposals to convert that institution into something in the nature of the Gold Standard, which seems to be suggested in some quarters? In view of the fact that there appears to be considerable losses through the so-called cheap sterling transactions, will the right hon. Gentleman consider tightening the exchange control machine in order to tackle that very difficult problem? Lastly, would the right hon. Gentleman tell us whether there is to be an Economic Survey, and if and when it is to be published?
In answer to the right hon. Gentleman, it is impossible to give the actual date when the benefits from the cuts may be seen, but there is no doubt that the effect of the very considerable cuts is now being felt and should be felt as the weeks and months go on. Cuts by other countries and the fact that the sterling area has to some extent reduced its imports from the non-sterling area, is already having an effect. We have evidence that this action is being taken by several countries concerned. I am sure that the right hon. Gentleman would not expect me to answer for the other countries. I can only indicate the trend.With regard to the European Payments Union, I feel sure the sinister implication of the question by the right hon. Gentleman need not be inferred. I have just returned from a conference of O.E.E.C. in Paris, and, apart from the public statement made by myself and other finance Ministers, I am not aware of any development in that respect, beyond the desire to strengthen the convertible assets of the European Payments Union, and if necessary to call upon its members to play an even greater part in its operation. On the question of losses through what might be described as the black market in sterling, certain steps have already been taken, as the right hon. Gentleman knows, to tighten up the exchange machine. We have considered the suggestion he has made, but up till now we do not think it would be quite as valid and important as he himself has thought. But I give continual attention to these matters, and if any suggestions can be made I shall be only too glad to consider them. Lastly, with regard to the Economic Survey, I am hoping it will be published soon after our return from the Easter Recess. The right hon. Gentleman and his hon. Friends may comfort themselves in any case, because it looks as if the Economic Survey will be no later than the Budget would originally have been, and to that extent will be available at about the usual date. Hon. Members on all sides of the House have had to submit to unpleasant decisions. The country as a whole has had to make sacrifices in the internal field and otherwise. I hope that hon. Members and the country in general will feel that the sacrifices have, at any rate, had some result. I agree with the right hon. Gentleman that the position remains serious, and a great mistake would be made were it thought that we had reached safe ground. A great deal more extra effort will be needed. Let us all make that effort together and have regard to the public interest to the best of our ability.
May I ask the right hon. Gentleman if he thinks there is likely to be for a very long time to come a strong case for taking advantage of the waiver of interest clause in respect of the American and Canadian Loans?
The time for that is not yet, but the observation of the hon. Member will not escape the consideration of Her Majesty's Government.
With reference to the closing remarks of the right hon. Gentleman, may I ask whether he realises that we on this side of the House are perfectly prepared for any necessary sacrifices, providing they are fairly shared, but in our opinion what the right hon. Gentleman and his friends have done is to impose them unfairly on the poorest part of the population?
This is a private Members' day.
Northern Roadways Limited (Road Service Licences)
With your permission, Mr. Speaker, and with that of the House, I should like to make the following statement about the recent decision to revoke certain road service licences issued to Northern Roadways Ltd.Under the Road Traffic Act, 1930, which arose directly out of the Royal Commission on Transport, an operator who wishes to provide a road passenger service has to apply for a road service licence from one of the licensing authorities set up by that Act. Objection may be made to such applications and under the 1930 Act, an appeal may be made to the Minister of Transport, either by an applicant who is refused a licence, or by an objector who is aggrieved by its issue. When such an appeal is made, and appeals are quite common, it is the practice to appoint an independent inspector to hear it and to make a report to the Minister. The procedure in the present case is that which has been followed by successive Ministers of Transport for over 20 years. The decisions which it was my duty to make were in accordance with the recommendations made by the inspector and are, in fact, in line with similar decisions taken by all my predecessors. It has since been represented that the Company, while their licences were under appeal, have made advance booking arrangements covering the whole of the summer with a large number of intending passengers. The Order which I made did not specify a date for revocation and I understand that the licensing authority are in the special circumstances considering letting the licences for the services from Edinburgh and Glasgow to London and from Glasgow to Scarborough run until the end of the summer. It is customary for the effect of such revocations to be delayed by the licensing authority for a short time to avoid public inconvenience. So long an extension as is now envisaged is unusual, but it should minimise any inconvenience to the public which pre-booking on such a large scale might otherwise have caused.
Is not it the case that this decision to extend time is unprecedented since the Act of 1930 has been in force, and is not the Minister running himself into grave danger of frustrating the will of Parliament in connection with appeals of this nature? Will he bear that very carefully in mind? Judicial processes have been gone through.
I think that the Minister knows better than the hon. Member for Dorset, South (Viscount Hinchingbrooke). May I ask whether it is the case that the public inconvenience, which has undoubtedly been caused, has resulted from delay in settling the appeal and from the fact that the company "jumped the gun" by accepting bookings before the result of their appeal had been heard? So that there shall be no further doubt or inconvenience to the public, will the Minister tell us what is his intention at the end of this time when the extension runs out?
Let me deal with these points as far as I can keep them in mind. The first main point is that this procedure is, as the hon. Member has said, one set up under the 1930 Act. The lapse of time between the lodging of appeals and the decision is fairly long. That has always been so in these cases, because a great deal of work has to be done on the preparation of the case by counsel for all the interested parties.The next point is that no decision has been made by the Minister in connection with the extension of the period. As I said in my statement, it is an unusually long period, but this decision is entirely for the licensing authority, who will have regard to the great public inconvenience which would be caused if these services were discontinued straight away, As I said in my statement, it is customary for the effect of such revocation to be delayed by the licensing authority for a period to avoid public inconvenience. I agree this is an abnormally long period. This case has been handled entirely according to the provisions of the 1930 Act, and it would be quite improper for me, acting in a quasi-judicial capacity, to make any comment beyond that.
May I press the Minister on this, because the public must know where they stand, and the Company must know where they stand? Is there any likelihood that this Company will be able to carry on bookings after the present extension of time has run out, or not?
That would depend on whether they lodged applications for further licences.
With respect, this is a very important point. If they do not lodge further applications, am I to understand that the provisions of the report of the inspector will be carried out and this service will have to come to an end?
That is the position under the Act and under the decision it was my duty to make.
Would it be possible for the Minister to go further and to extend the time or for the licensing authority to do so?
The licensing authority has to make up its mind as to what is reasonable in the circumstances. Having made up its mind, that is final.
While appreciating the Minister's difficulties under the present law and welcoming the statement that it is likely that the summer service at least will be run, may I ask him to bear in mind that there are a great many people who, not only this year but every year, can take holidays only if they can get cheap transport? Further, may I ask him whether it is the intention of the Government to amend the law so that these people may be provided with cheap transport and that this uncertainty may be eliminated?
On the first point, the hon. Member will realise that my function in this matter is quasi-judicial, and I could not comment on the first part of his Question. On the second part, that is a matter which must be looked at among other things which are being examined.
On the quasi-judiciality of my hon. Friend's action, would he agree or disagree with this proposition: that the object of providing by Statute for reference to a Minister is not in order that he should give a legal and impartial judgment and thus usurp the functions of the higher courts, but to enable him to perform an act of political and administrative justice? Will my hon. Friend see that those officials who put up to him cases of this kind in future are fully acquainted with that proposition?
I must say to my noble Friend that the position of the inspectors in this matter is entirely independent and judicial. They are bound to act as they have acted in this case.
They are, but the Minister is not.
I too am bound by the case history of these matters and the interpretation of the Act.
Will the Minister tell us what part the nationalised transport system may have had as shareholders in any of the companies or parties which appealed against these licences? Further, will my hon. Friend look into the procedure which results in this considerable delay? Finally, can he say whether the whole question of road touring and the hotel industry was taken into consideration when the inspector looked into the matter?
On the first point, I think that it would be simplest if I gave the detail of what appeals were lodged. There were 38 appeals lodged against the four licences in question. One company, completely independent of the British Transport Commission, lodged six appeals. Three companies in which the majority shareholding is in private hands but the British Transport Commission have a minority interest lodged 13 appeals. Four companies which are controlled by the British Transport Commission lodged 11 appeals, and the Railway Executive lodged eight appeals. On the last point which my hon. Friend raised, the licensing authority and the inspectors act completely judicially in these matters and they are bound to do so. I am afraid that I missed the second question.
Agriculture And Horticulture
I beg to move,
If we wished to have a sense of reality in this debate, we could not have been more fortunate than we have been in having the statement from the Chancellor of the Exchequer earlier today. Although we appreciate the seriousness of what my right hon. Friend said, I suggest that if we had this debate without bearing in mind the financial position of the country we should be wasting our time. I am in some difficulty in moving this Motion because, as was unforeseeable at the time I asked permission to raise the matter, the annual Price Review is still in progress. Naturally, that must, to some extent, make it rather difficult for the Minister to reply. On the other hand, I should like to stress at the start that what I propose to talk about is not only the present year's problem. I want to discuss the general long-term problem of agriculture. I do not believe that discussion of that problem should be prejudiced by the fact that a Price Review is in progress. I move the Motion with confidence, because my right hon. Friend was good enough, during the General Election, to give me a pledge about part-time smallholdings which he has already honoured. At the same Election we had a constructive long-term policy for agriculture which I think the right hon. Gentleman the Member for Don Valley (Mr. T. Williams) would agree was not so very different from his own. I hope that we shall have an assurance from the Minister that he intends as soon as possible to implement the terms of the policy which we have outlined so many times. I am encouraged in this belief by what the Secretary of State for Scotsaid to the National Farmers' Union in Glasgow. The "Farmers' Weekly" of 28th March reports that he said:That this House, realising that the health, wealth and happiness of the British people depend first upon the ability of British farmers, growers and farm workers to produce, with the highest efficiency, the greatest possible amount of high-quality food, calls on Her Majesty's Government to present for the ratification of this House its proposals, covering not less than the next four years, for British agriculture and horticulture, with particular reference to capital investment, guaranteed prices, marketing, fruit and vegetable imports and rural amenities.
I could not possibly quarrel with what the right hon. Gentleman said, except perhaps with his use of the word "policy." I do not intend to imply in any way, by moving this Motion, that we have no policy. In fact, it has been outlined and put before the electorate on several occasions. Certainly, the "Manchester Guardian" was quite wrong in supposing, on Monday, that I was trying to imply that we had no policy. But a policy requires definite proposals to follow it up. It is those proposals which we seek to hear about today. I do not intend to dwell for long on the past, because I know that a lot of hon. Members want to speak. However, it is important that we should bear in mind a few of the factors which have influenced British agriculture since the time when we first had really reliable statistics on which to work. That was in 1870. There have been six main features which have predominated British agriculture since then. Those features are, the impact of the North American, Australian and Argentinian production; the increase in mechanisation; the effect of the use of artificial fertilisers; the increase in our own population; and the increased earnings of all industry which has enabled more people to buy more food. As an example of that, in 1870 we were eating, per head of the population, 100 lb. of meat, whereas in 1936 we were eating 148 lb. The figure today is only 105 lb. plus canned meat. The figure for butter rose from 12 lb. a head to 25 lb. a head in the same period. There is one further factor, and that is the fall in the value of money which inevitably takes place with such catastrophic events as world wars. All these features must be borne in mind today. Over that period, from 1870 to the war, it is true to say that what was important from the view of the country as a whole was not so much the gross production of British agriculture as how far the net production of British agriculture met the needs both in terms of energising food and of the national economy in general. Up to 1939 there was a fall in the net output of British agriculture which nobody has been able to assess, but that fall never affected the majority of the people living in the towns very much because, throughout that period, food could be obtained more cheaply abroad than it could be grown at home. At least, that was so in many cases. Had it not been for the friends of agriculture in this House throughout those years—and, Mr. Speaker, I think you would be glad to regard yourself as being among them—I think agriculture might have been in an even more difficult position in 1939 than it was and that the country would certainly have been in a much more difficult position throughout the war. As a result of the efforts of some of these people, in trying to help agriculture, we find that by 1939 approximately £20 million a year was being paid to British agriculture in various forms of subsidy. We are apt to think that subsidies began during the war and have merely been carried on since, but the foundations were laid before the war. We had the £5 million subsidy on beef, the £1 million deficiency payment to bacon curers, £5 million to wheat growers under the 1932 Act, £1¾ million Exchequer subsidy on barley meal and oats, £6 million sugar subsidy and revenue abatement, and £2 to £4 million going to the producers under the Milk Marketing Board. It is important that we should remember that the system which we have today in British agriculture began long ago. Too often we forget that that is so. I suppose that no two things were more important in saving the farmers in my constituency, the Isle of Ely, than the Wheat Act, 1932, and the Sugar Beet Industry Act. Those foundations were laid for Lord Hudson, now in another place, and the right hon. Member for the Don Valley, who built the structure which has been embodied in the 1947 Act. When the war ended the guaranteed prices were continued and a great, new change came into the minds of a great many people in this country."What we have to work for is a comprehensive long-term policy for the future, and we will work for that in the months ahead. I should like to see a long-term policy which is agreed between the Government and the leaders of the farmers' unions which will restore that essential confidence which the industry needs."
I should be grateful if the right hon. Gentleman the Member for Belper (Mr. G. Brown) would try to avoid being too partisan. A new feature came into the minds of a great many people. I think we might say it was first enunciated by Dr. Malthus who, during the period 1939–50, took on the shape of Sir John Boyd Orr. That is the point of view that
Another thing which has come out of the war is the fact that people now require greatly higher standards of nutrition. This has meant not so much a question for us of maintaining the output which we achieved during the war for British agriculture. What is now important is that we should go ahead with the re-orientation of the industry and the further increase of production. There is another very important thing which, again, Dr. Malthus was the first to put forward, and we must bear it in mind now. He said:"The natural tendency of the human race to increase works faster than the possible increase of the means of subsistence."
That is not so much the law of diminishing returns as, in my opinion, a law of unscientific slackening off. It is very important that we should bear in mind that some people hold that view today. In my opinion it would be calamitous if that view became the predominant one at the moment. This is a momentous year in the history of British agriculture, because all farmers and all farm workers are awaiting to see whether the new Minister intends to accept the Malthus theory that, because in recent years we have a great increase, therefore we must have a slackening off. It is important that he should produce for us, as soon as he can, really sensible proposals which will give farmers enough confidence to continue improving their crop yields and their stock. What the Chancellor of the Exchequer told us this morning bears out very well that many things will be put before us to suggest that we must bring down costs, that the cost of food is too high at present, and various other points like that. If the result of advancing these arguments now is that what happened after the Second World War is to be the same as that which happened after the First World War, then this country will starve—and there is no question about that. There is no cheap food abroad now."It must be evident to those who have the slightest acquaintance with agricultural subjects that in proportion as cultivation extends, the additions that can yearly be made to the former average produce must be gradually and regularly diminishing."
When did the hon. and gallant Member find that out?
We must continue to grow more and more food at home. I hope that as soon as he can the Minister will tell us that he proposes to accelerate the production of British agriculture. I am encouraged in the belief that this is the Ministerial view, as well as my view, by an article which Mr. James Scott Watson wrote in "The Times Agricultural Survey," which says that the world population is increasing at the rate of approximately 25 million people a year, which works out at the incredible figure of 47 people a minute.Before the war imported feedingstuffs could be brought to this country at approximately half the price which they cost to grow at home. Today, the position is almost precisely the reverse. Home-grown feedingstuffs today are approximately half the price of those abroad. I agree with Mr. James Scott Watson when he says
But there is more than one method of making the utmost of anything as a rule. One method which has frequently been put forward to hon. Members is that of Mr. Ferguson—and I am sure this will interest the right hon. Member for the Don Valley, in view of his new appointment, on which I am sure we all congratulate him. Mr. Ferguson has been arguing for some years that the way to solve our present difficulties is to pump into agriculture a national land loan to enable 360,000 extra tractors a year to be brought into the industry, thus dispensing with the horse, increasing the arable acreage, especially from rough grazings, and so providing more cereals for human beings to eat and more feedingstuff for animals, both dairy and fat stock. This is a very admirable suggestion in many ways, but it pre-supposes that the necessary capital is available, and that it should be employed in that way in the light of our present chronic situation. Much as I respect Mr. Ferguson as an engineer—indeed, I have one of his tractors—he is open to the criticism that he is trying to impose on a natural historical process a commercial policy very largely designed to sell his own tractors and implements. And I believe that if he were Chancellor of the Exchequer now he would not be able to do what he has been advocating over the last few years. But he is right in saying that unless the export prices of our manufactured goods are reduced it will become harder and harder to sell our goods and failure to do so would mean that we should have further ration cuts and a lower standard of living here. It is important to remember always that with countries and with industry the margin between viability and collapse is very narrow indeed. With our balance of payments as they are and our reserves running out as they are there can be no more important factor than timing. It is no good our planning huge agricultural development, however much in itself desirable, if in the process we overload our national economy. The first duty of any Government, however idealistic, is to keep the ship on an even keel. At present our ship of State is riding through a monetary monsoon. It is no good at all throwing the emergency rations overboard simply in expectation of a banquet we are going to have if and when we reach port. Of all the issues in British agriculture that must be satisfactorily settled, there is none more thought-provoking or more likely to lead to acrimony than the provision of working capital for the industry. Before the war the industry had a working capital of £350 million approximately. National Farmers' Union figures up to the end of 1950 show a working capital of £1,000 million invested in the industry. The annual net income per farm is given as £710, or £13 10s. a week. One third of that on the average has been re-invested by the farmers so that at the end of it all they have about £475 annually or approximately £9 a week, and out of that they have to pay Income Tax and interest on loans and build up reserves. A break-up of that average figure of £710 net income per farm shows that farms up to 50 acres have been averaging up to £8 a week. Farms of between 50 and 100 acres have averaged £12 a week and between 100 and 150 acres £15 a week compared with approximately £3 before the war; but that does not take any account of the fall in the value of money. If we are to improve our methods—and I am sure the Minister would agree that that is very important—we must ensure that what capital is employed in the industry is employed as effectively as possible. It does not always follow that because a farmer uses implements he is necessarily reducing the cost of production. What it means very often is that he is increasing the speed with which he can get the work done. There is a most interesting article in the current issue of "Farm Machinery" written by a former technical officer in the Isle of Ely, Mr. Scriven, and Mr. C. M. Poole of the Agricultural Institute, Kirton. Writing of potato planting they state that the slowest method—by hand—takes 12.5 hours per acre whereas using an automatic three-row potato planter brings the time down perhaps to four and certainly not more than six hours. The "National Farmers' Union News Sheet" of 1st April has the following interesting paragraph:"The obvious action in the circumstances must surely be to make the utmost of our home acres."
"Referring last week to the Government's decision to restrict capital investment in farm machinery and equipment to 70 per cent. of last year's level, Mr. H. Cole Tinsley, Deputy President of the N.F.U., said that if a further agricultural expansion programme were to be embarged upon the whole question of machinery supplies would have to be re-examined …
I must confess that the figure of 70 per cent. was new to me, but it bears out somewhat what was said in an interesting series of articles in the "Economist" in February which stated that whereas capital over the last few years has been applied almost blindly, and that there has been a blanket capitalisation, it is now a question of finding where the capital is most needed and ensuring that it goes there. The question is how to do that. It is important that the House should be aware of what has been happening to loans. Bank advances have been rising every year. In 1946 they were approximately £70 million. In 1947 they had gone up to £86,500,000 and in 1951 they were £178 million. I think the hon. Member for Wednesbury (Mr. S. N. Evans) would be the first to agree that no one in his senses will borrow unless he has to do so.The N.F.U. attitude, continued Mr. Cole Tinsley, was that there should be no restriction on the supplies of those machines of which there is not yet a sufficient number on our farms—such as crawler tractors, combine harvesters, pick-up balers, root harvesting machinery, mechanical handling equipment and grain conditioning and storage equipment."
I never remember a time when my business was more prosperous than when I owed the bank £18,000. Before the war the average overdraft figure for the industry was about £62 million. If the hon. and gallant Member takes into account the change in the value of money and the increased turnover which the industry is always claiming, there is nothing abnormal about the present rate of bank advances.
I am simply pointing out that farmers are increasing their loans year by year and that working capital is essential to the industry. The question is what is to be the source of that capital. If farmers obtain it from the bank their costs will go up because the rate of interest charged by the banks is going up. Farmers are investing approximately 6s. 9d. out of every £1 earned and that leaves 13s. 3d. only to live on. The best capital provision for the industry is a decent profit from the previous year.There is an aspect of this matter which we ought to bear in mind. We had our attention drawn to it quite recently at a conference luncheon arranged by the British Institute of Management which was attended by the Minister. Addressing that joint meeting of the British Institute of Management and the Royal Agricultural Society on 27th February Mr. J. H. Lord, a director of Dunlops, pointed out that the average net farming income in 1945–46 was £737 and apparently rose to £1,115 in 1948–49, or by 51 per cent. When those figures are further examined they show that the actual realised cash income declined from £663 to £544—a decline of 18 per cent.—whereas the difference in the opening and closing valuation of stocks and machinery increased from £74 to £571 over the same period—an increase of 670 per cent. Thus we have a situation where the so-called increase in farming net income represented merely a paper profit. The figures which Mr. Lord analysed were taken from the periodically published statistics of the Ministry of Agriculture, so that I do not think that we can doubt their veracity. Mr. Lord then said:
Those are very important points to bear in mind in deciding how the capital should be provided for this industry. We have had about £410 million of capital put into this industry since 1947. It is true in certain cases that not all of that capital has been employed in quite the way it might have been. I think it can be said perfectly truly that those with considerable capital resources behind them have been able greatly to improve their methods, have improved their output and have made farms which are a pleasure to visit. At the other end of the scale, in intensive horticulture, we find almost maximum efficiency. But in between those two extremes there is a gap which is filled with people whose farming standards are very variable and who have not always used the capital in the best way possible. I hope that Mr. Cole Tinsley's statement of 1st April means that the National Farmers' Union will make sure that the 70 per cent. of last year's capital investment in the industry will be put where it is really needed. It is in that section of the farming industry that the need is greatest."The so-called increase was due entirely to a paper profit on valuations at the dates taken. Obviously, any halting or reversing of the inflationary conditions will not only seriously lower the so-called profits but will at once eat into the capital resources because tax will have been paid away in cash on the paper profit element. The larger the farm, according to the same course of statistics, or the greater the production achieved, the figures are correspondingly larger and more vulnerable."
The hon. and gallant Gentleman has made a valuable and interesting suggestion. I think he should explain to the House what action he proposes ought to be taken to direct capital investment into the field where he suggests it ought to go.
I am hoping to say something about that before I finish.There is one policy which the Minister ought to have in mind the whole time. It is a fact that we are short of certain things. I think there is no question that we are short of meat. On imports last year we spent £34,202,000 more on buying 744,200 tons less meat than we did in 1936. The total imports today are worth £117 million as compared with £82 million before the war. For that enormous increase in price we are getting three quarters of a million tons less meat. It is very important that we should concentrate, in whatever we are going to do for this industry, on meeting the greatest need, and I believe that the greatest need is the production of more meat. I criticise the policy which has been followed with regard to prices, and which may be followed again with respect to the proposed pig breeding scheme if we are not very careful; I refer to the policy of paying too high a price for the medium weight and not enough for the heavier beast which, after all, is a cheaper beast to produce. The time when the beast is fattened most cheaply is in the last stage when it can be done largely on grass. I know that this is a somewhat contentious matter, but I hope that that point will be borne in mind. As to the question of capital, the important thing is that it should be introduced now in such a way as to increase the yield or the output of whatever the farm is supposed to be producing, and there should be a little less concentration on such matters as building the most elaborate dairies with the very latest gadgets which are all very expensive. It is possible to produce T.T. milk without having expensive fittings and the most elaborate gadgets. It is important that we should concentrate on employing the money where it is most necessary, and that is in increasing output. I hope, therefore, that my right hon. Friend will encourage farmers to use their own local materials and labour so far as possible for their buildings, and only to spend money on outside labour in improving conditions in which their workers live. We ought to pay a tribute to the Minister of Housing and Local Government for introducing the Housing Bill, which will enable farmers to improve the conditions of their tied cottages. I foresee in the coming years very little being done in the way of increasing the amount of capital available for farming. We have to make sure that the money is spent where it is most needed. I now want to turn to the Amendment in the name of the hon. Member for Wednesbury. I had hoped that today we should have been able to spend a pleasant morning and afternoon in a quiet and agreeable atmosphere discussing, quite objectively, all the facts and the problems.
Unfortunately, looming on the horizon from Wednesbury there comes a bulldozer with the registration number RC 1952—the letters standing for "Royal Commission" towing a load of foundry sand costing 80 per cent. above the pre-war price.I had hoped that at least we should have been able to get universal agreement on this matter in all quarters of the House. I suppose it is something to be thankful for that the hon. Gentleman is prepared to accept the first half of my Motion. At least, he accepts that the health, wealth and happiness of the British people depend, first of all, upon the British farmer, farm worker and grower producing high quality food as efficiently as possible. It is something to have got the hon. Gentleman that far. The right hon. Gentleman's Amendment, however, flatly contradicts the first half of the Motion. I do not believe that the farming industry as a whole has anything whatever to fear from the Royal Commission, but there is nothing which is going to shake the faith of the industry in us politicians at the moment more than the Royal Commission. I say that because I believe that it will put the whole question of guaranteed prices and assured markets in the melting pot. I thought we had got agreement on both sides of the House in that matter; it would be calamitous if, at this moment of all moments, we were to destroy that confidence. But it does something else. I do not know if the hon. Member realises it, but by asking for a Royal Commission to find out the facts about farms and prices, what he is saying is that the Labour Party was not entitled to put forward the policy for British agriculture which it put forward at the last General Election.
The hon. Member will have his opportunity to speak later. I think he knows that I am usually very ready to give way.What is really happening is that the hon. Member and his Friends are trying to criticise the efficiency of British agriculture. If he looks at the figures I think he will find that we have increased our wheat, our barley and our oats steadily since 1870, when the first statistics were available. We grow 19.2 cwts. of wheat per acre, compared with the United States figure of 9.6; Canada, 8.8; Australia, 8.1; and France, 14.3. The only country I can find that does better than we do is Denmark. The hon. Gentleman has done much to harm the industry by the things he has said in the past. I hope he is not going to take that any further today. Let us look at the problems that have confronted the industry. Wages have trebled—
The Bank rate has gone up.
The cost of tyres has trebled; grain sacks have gone up 10 times; decorticated ground cake, nearly five times; linseed cake, four times; superphosphate, over four times; sulphate of ammonia almost twice; basic slag, 3½ times; and binder twine, 5½ times. What is the increase the farmers have received? There has been no increase in prices for any major commodity of more than four times, which is the increase on bacon pigs. Wheat has only gone up 2½ times; milk, 2½ times and potatoes, 2¾ times.I should like to forestall the hon. Member if he is going to argue that the National Farmers' Union will be asking for the re-imposition of the food subsidies to disguise this. I hope he will not say that, because I am going to tell the House what the N.F.U. has said on this subject.
I think it is important that hon. Members should bear that in mind in anything they say about the N.F.U. In some notes the N.F.U. circulated to speakers it said, in October, 1951:"The level on the incidence of consumer subsidies on food may be varied but no responsible person would dispute two things: first, that substantial consumer subsidies are likely to continue; and, second, that the smaller they can be, the better, other things being equal. Every saving cuts the burden on the Treasury and the taxpayer … There is no one who would not wish to see Income Tax lightened … Anything which offers hope in this direction is thus doubly welcome."
My hon. Friend the Member for Ashford (Mr. Deedes) will be dealing with marketing, and fruit and vegetables, which are vital matters for the future of the industry. Punishing the good farmer is mad. It is the most stupid thing we could do. If he makes a profit the farmer provides four important things. First he provides much-needed food; second, an improvement of his land; third, he sets an example for others to follow; and, fourth, he helps to finance the country through heavy taxation. All too often I think that that last point is forgotten."Now that what is on the whole an adequate supply of capital has been put back into the industry, it is recognised by the Government and industry alike that in so far as help is given from public funds it should be directed as far as practicable only to those farmers who could not do what is being asked of them without it."
It is common to all.
Our first object is to try to find ways of enabling others to follow the example of the best. We must ask the Minister as soon as possible to find ways and means of tightening up machinery for ridding ourselves of the worst farmers. The Agriculture Act requires Amendment. It is important that the Minister should follow in the footsteps of his now noble predecessor—Lord Hudson—in keeping in far closer touch with the agricultural executive committees by visiting them in their own areas, which was something the ex-Minister was not able to do, though I am not saying that he did not want to do it.It is important that the contact between the Minister and the A.E.Cs. should be as close as possible. We know that the A.E.Cs. have been rather discouraged. Some of them have a feeling that however much they want to improve the output from their areas they cannot do it unless they are really backed up by the Minister the whole time. I hope that the Minister will do his best to try to help them to weed out the people who should be weeded out and that he will try to tighten up in the best way he can the supervisory powers of the A.E.Cs. The period of supervision is too protracted at the moment. I hope the Minister will find ways and means of getting all our land used to the maximum efficiency as soon as possible. He will have to go into the very closest consultation with the N.F.U., the National Union of Agricultural Workers and with the C.L.A., to find ways of ensuring that the capital now available to the industry is used for the most essential work. Agriculture has its enemies and its black sheep. They are both in a minority and I think we should be grateful to the industry for what it has done in improving its methods, increasing its yields and bringing us higher quality food. I agree with Disraeli when he said:
It lies within the power of the Minister to provide British agriculture with the confidence that will enable all those concerned in it to play their part in this great battle to provide our people with the energy they need. To give them that confidence he must avoid, at each Price Review, suddenly giving an emphasis to different interests. I realise that he may not be able to go the whole way today because of the Price Review negotiations which are still proceeding. I hope that as soon as possible the Minister will tell us what he wants the structure of the industry to be, and give an assurance to all farmers that that structure will not be changed overnight, with the calamitous results which had occurred in the case of dairy farming last year and poultry producers the year before. In my very real regard for my right hon. and gallant Friend I hope that he will not fail to serve the farming industry as he would wish it to serve the British people. That industry is trying to do its best and if it can be given confidence I am sure that it will not fail in its task."I wish to see the agriculture, the commerce and the manufactures of England, not adversaries, but co-mates and partners, and rivals only in the ardour of their patriotism and in the activity of their public spirit."
I beg to second the Motion.It provides an opportunity for a much wider and longer-range debate of agricultural problems than have some of the more specific Measures which we have discussed recently. I think it is an extraordinarily good moment for a debate on these lines. At this moment a great many people are watching with anxiety the new pattern of world trade which has been emerging in the post-war years, and our place in that pattern. Anybody who does that will believe, as I believe, that it is possibly going to be more difficult to feed 50 million people in these islands in the next 10 years than it has been in the last 10 years. I do not think that anyone who surveys the trends of world trade today and the declining volume of food exports entering that trade will doubt that. I believe that the issue before us now is not, as it has been all through our lifetime, prosperity or penury for the British farmer, but production or privation for the people of these islands. That is the real issue, and in that belief this Motion calls for a four-year plan. I do not think that four years is excessive. Four years is a long time in the lifetime of a politician, and may even constitute practically a whole career, but to a farmer it is the minimum term in which he can plan for himself. None of us can foresee the economic circumstances of the next four years, of which we are speaking in discussing this Motion, but I have my own ideas about them and I think they will be very different from the ideas of the hon. Member for Wednesbury (Mr. S. N. Evans). My eye is on some remarks made by the Chancellor the Exchequer when he wound up the Budget debate on 17th March, and, in the course of those remarks said:
I wonder if that is the background against which the Minister of Agriculture is thinking, and whether than has been the background of the discussions which have been going on with the National Farmers' Union. We all know that there is a chilly wind blowing through some of the world's trade channels just now. We do not know quite where it started or where it will end, but the fact remains that it is blowing and it has some bearing on agriculture's problem. I am not supporting this Motion asking for this four-year plan because I believe that the next four years are going to be exactly like the last four. It would be possible to count on that. During and since the war, the whole system of price guarantees and market guarantees has been designed to meet inflationary circumstances. Many prices are today, and, indeed, have been all along, not minimum but maximum prices, not a floor but a ceiling, not doing what they were originally established to do, but something quite different. I want to ask the Minister whether all this machinery is in good working order to cope with a sudden reversal. Is that being borne in mind in the current discussions? I suggest that, were world prices to fall, they would fall a long way ahead of costs, and that the fact of prices falling ahead of costs would be likely to lead to falling production. That is the one thing we have to avoid. There may be many who think that, if world prices did fall, all would be well and that we could buy more food again, as we used to do. That might have been so 10 or 20 years ago, but it is not so now, because a fall in world prices would lead to a fall in our earning capacity, in our capacity to buy, and, therefore, in our ability to meet the needs of our own people. That is why the maintenance of the level of production here, is going to be fateful for the well being of our people. I want to refer to the Amendment in the name of the hon. Member for Wednesbury, because I feel that he overlooks—and I hope that if I am wrong he will correct me when he speaks—that, while farmers' prices have been controlled, costs have been and remain uncontrolled. It is these circumstances that have made inroads in the working capital, that have raised bank overdrafts to £200 million, and have built up unrecouped costs of £60 million over the last three years. It is these circumstances which led the producers so much to seek stability. I suggest that, if the hon. Member for Wednesbury will confine himself to some aspects of the price machinery, he will be doing a very useful service. No doubt, we shall hear a great deal from him on that later. I admit that this machinery is not perfect. It would be a disservice to agriculture to pretend that it is. It is a very clumsy instrument for switching —in modern jargon—the price emphasis, of which we recently had more than one example. It operates very well as an incentive, and very badly, even disastrously as a disincentive. Each annual Price Review is accompanied by acute anxiety on the part of the producers, and the extraordinary thing is that, the better they have done in fulfilling the tasks laid down for them, the more anxiously they approach the annual price review. There is a tendency for the penalty for success to be a loss of incentive to producers, as in the recent examples of milk and eggs. I make a present of that to the hon. Gentleman. There are one or two other drawbacks. I think that the overriding consideration today, quite honestly, is not financial help for the big man, and I hope there I carry the hon. Member for Wednesbury with me in saying that. What they want is not more cash or capital but continuity, and my right hon. Friend could swop with the bigger farmers cash for continuity: he could do that with many of them, and would satisfy them. It is a higher yield and more intensive farming from the smaller man that we have got to get, and it is the smaller man who produces half of the farm products of this country. Three-quarters of the farms in this country are less than 100 acres in extent, and for every one over 300 acres there are 21 under 300 acres. Of these, 44 per cent. have no regular labour. Two-thirds of them employ at most one man, and, taking a 70-hour week into account, if we deducted wages for the man and his wife on some of these small holdings, that farm would be "in the red." These are the people whom we should be bearing in mind. How are we going to provide stability there without subsidising inefficiency? It is my belief that the small man will not be squeezed out by hard bargaining in the annual Price Review. What he will do, in my belief, is this. He will accept a lower standard of living for his wife and family and himself, and he will turn to subsistence farming, living on a lower standard himself, and we shall get less food. That is the problem with which I do not think the price machinery can cope at the present time, and I would be glad if the right hon. Gentleman would address himself to it. Like my hon. and gallant Friend, I do not like the A.B.C. system of grading farms, nor do I like the way in which it is carried into effect. Great play has been made with the number of evictions which have taken place. In fairness to the system, it should be stated that supervision has persuaded a large number of inefficient farmers into retirement, without necessitating eviction. None the less, I do not think that the system is ideal either in regard to the B or C categories, and I think that the time has come when, over a four-year period, we might consider something different. I want to say a word or two about feedingstuffs before I turn to horticulture. The longer one looks at the feedingstuffs situation, the more obvious it is that there is no single or simple solution, and people who think so are building up false hopes. The ploughing-up subsidy will be helpful, but I am sure that the Minister will agree that the four-year period is a stimulant rather than a permanent solution. I should like the price margin between imported and home-grown grain to be reduced. It is, in fact, reducing itself now, due to a fall in the cost of foreign grain, but that difference has led to a bad market in this country, which the farmers are prepared to admit, and it has led to a lot of grain going to where it is not primarily needed. Fourth, great hope is being pinned to swelling propagation of the pig population. All I would say on that is that I hope the Minister of Food will reconsider his ideas about the small pigkeeper. It is no answer to say that a lot of bread may be wasted. The truth is that a lot of pork is being lost. It is in that spirit that I hope the problem will be approached. I am convinced that, in the long term, more cold storage for beef and mutton coming off our summer grass would be a major contribution to the feedingstuffs problem. How that fits into the capital investment programme, I do not know."I have been advised that there is much more danger of deflation and the possibility of unemployment and of difficulty in the world in general than some of the more lively economic critics outside this Committee imagine. It is against that background that I deliberately took a serious and, I believe, responsible decision."—[OFFICIAL REPORT, 17th March, 1952; Vol. 497, c. 2050.]
It does not.
That remains to be seen. I think, further, that one ought not to underrate the progress that has been made since the war in the production of leys and kindred crops, in which great advances have been made.Now I turn to the horticultural industry, an industry worth £125 million a year to us, or a fifth of the agricultural industry. Here not only is the grower guaranteed no price and guaranteed no market or any automatic recoupment of rising costs; but, much worse, he is made to appear, in relation to the subsidised producer, as a robber—an impression, I regret to say, which some hon. Gentlemen—and hon. Ladies—opposite have not done very much to lessen. The prices of grass fertilisers, labour and packaging, have doubled, trebled and quadrupled since the war, and the reactions of many hon. Gentlemen opposite have been to say that the marketing is scandalous—that the marketing conditions are scandalous. That may or may not be true, but it is not the whole answer to the situation in which horticulture finds itself in today. What the industry wants is not security because, in the nature of it, that is out of the question. What it wants is more stability—and that only to achieve the levels of production laid down by the late Government. There has been no stability. There has been no certainty from one season to the next what the market will be, or even if there will be a market at all. Of course, horticulturists accept that the market is a gamble. This is a gamble—a gamble with wide margins, against climate, gluts of home produce, and so on. That is all accepted as reasonable odds; but what is not reasonable odds is the whimsical system of imports—a system not understood by any part of the industry, and, I think, not even fully understood in Whitehall. Our import policy here has been misguided, and one which, for the benefit of those who are interested, and for those who support free trade in this House, I would say is not only misguided, and not only irritating to our own horticultural producers, but infuriating to producers overseas. This has been no contribution to the liberalising of European trade. I should like to know what system of safeguards the Government favour. They have specific duties, they have tariffs, they have quotas—or a combination of all three; and I think that horticulture should know where it stands in relation to these three alternatives and in relation to recent trade agreements. There is much talk about liaison between the Ministry of Agriculture and the Ministry of Food. What I want to see is more liaison between those two Ministries and the Board of Trade, because there is anything at the moment but co-ordination between the three Ministries and the conflicting policies of those three Departments. [HON. MEMBERS: "Lord Woolton."] No. The noble Lord has nothing to do with the Board of Trade. Apples provide a case in point. The growers of apples this season, certainly in Kent, have had the most disquieting experience, as I think the apple growers all over the country have had.
In Worcestershire, too. True they had a bumper crop this year of 200,000 tons above last year. In those circumstances, of course, the big grower, for whom costs have gone up—and it is the big grower I have sympathy with, because he is the man who puts money into washing sprays and other essentials for the growing of apples, and who grows apples as opposed to letting apples grow—has suffered in consequence a cut of about a fifth in price.What the effect of the 50,000 tons of apples that came from Canada and America has had on this situation, I do not know, but the most disquieting thing about that was the export subsidy under which those apples came—an export subsidy of about 50 per cent. of the import price, or 9s. a case. I should like to know what the Minister's views are, on subsidised exports, because that is a most disquieting trend in other directions, too. We have also the problem of the exceeded import quota, particularly with regard to broccoli and cauliflowers. In the year ended 5th March we were supposed to import 7,500 tons, but 9,900 tons arrived, or 33⅓ per cent. above the quota. How did that occur? Are they to appear again? Is there any attempt made to reduce the balance?—because we have 2,500 tons coming in from 1st April during the next following months, and arriving in large quantity at the beginning. There is a very strong case for reviewing the timing and a more equitable spreading of these quotas, and I think that it would make a good joint preliminary exercise in co-ordination for the Ministry of Food, the Ministry of Agriculture and the Board of Trade. Finally, a word on marketing, on which, I think, the policy of the late Government was undistinguished. I take the point no further than that. There were many ideas the Lucas Report and some other interesting documents—produced by the intellectuals of the Socialist Agricultural Society, I think it is—but the effect was not very great. We have one horticultural marketing scheme in operation for tomatoes, but I think that that was held up for two years, and the apples and pears marketing scheme appears to be going through the same extraordinary process. Where now is the apples and pears marketing scheme? I understand that it is going through the Board of Trade—that it is in a back room being stripped and searched for monopolistic practices. Could we have enlightenment on that point? Nobody grudges the Board of Trade what the lawyers call a sight of the document; but they cannot sit on it indefinitely, and the apple and pear growers would like to know whether they are going to have this scheme in use this year. There can be no effective import policy without a marketing scheme. I do not know whether my right hon. Friend realises—I am sure he does, really—that that applies not only to apples and pears, but to vegetables. Where is the vegetable marketing scheme? The time has come for this matter to cease to be an academic exercise for those with big political ideas but very small agricultural experience. We must get down to producing schemes to give guarantees to the home producers. The Minister faces a big difference from anything the trade has had in the last two or three years, because we, as a party, support voluntary co-operative marketing. The late Government failed in this respect.
How can the hon. Gentleman say that, in view of the Agricultural Marketing Act passed a couple of years ago?
They supported it to a certain point, but they did not believe that in the long run it could be effected without more centralisation, and without being far more in the hands of the State. [Interruption.] Well, many of their supporters thought so. We believe in it. We believe that this method will work, and I appeal to the Minister to apply the necessary stimulus in the right quarters to see that it does work.I end by saying that we must all realise—I have no doubt that my right hon. and gallant Friend realises—the immense opportuniity awaiting the Minister. There was a time when the Minister of Agriculture in this country spoke with a lone voice in the Cabinet on the needs of agriculture. That was so during quite a period of our history. Today there are many of his colleagues who are aware of agriculture's new role in a new world. However, neither the Minister nor his colleagues nor we are the decisive factors in this matter. The decisive factor is going to be the electorate, eight out of 10 of whom live in towns. The biggest contribution that we can make to agriculture is to achieve a broad understanding by the townsmen of the contribution of agriculture to their life and living, and anyone who seeks to cloud that understanding with extravagant political ideas incurs a heavy responsibility. I do not seek privileges for the farmers. What I fear is privation for our people. That is the sombre background to the Minister's task, and that really is the case for the four-year plan.
I beg to move, in line 7, to leave out from "to" to the end of the Question, and to add instead thereof:
Let me say at once that there are no Members of this House or citizens of this country more concerned for a healthy stable British agricultural industry than I and my hon. Friends who have put down this Amendment. We have, however, some misgivings whether the method and system at present employed is achieving the objective we all have in mind. The hon. Member for Ashford (Mr. Deedes), whose vigorous contribution we all enjoyed, should be very careful about attacking Members of the last Government or their policy, because he could put them in the invidious position of having to defend me, and that would not be a very good thing."recommend the appointment of a Royal Commission to investigate as a matter of urgency the agricultural industry, both from the point of view of producer and consumer, with particular reference to the present system of fixing farm prices and its effect upon production, costs and efficiency."
I am prepared to take that risk.
I am sure we are all grateful to the hon. and gallant Member for the Isle of Ely (Major Legge-Bourke) for putting down this Motion, because—
With great respect to the hon. Gentleman, when he pronounces the name of my constituency as "Eli," I wish he would remember that we have got a Bishop and not a High Priest.
Eli is a good old Black Country name. We are all glad that he put down this Motion, because there is no doubt that this is one of our two vital basic industries which, if we can get it going and keep it going, will do much to close the export-import gap and the dollar gap. We therefore come to this debate with a feeling of gratitude to the hon. and gallant Member and his hon. Friends.I, personally, feel that we have not had enough ventilation in this House of matters appertaining to the agricultural industry. The hon. Member for Ashford said that we must avoid a conflict between town and country. While I accept that, we must all recognise that there is at all times a potential conflict between the interests of the wife of the industrial worker in Wednesbury and the farmer in Wiltshire, and in the past it has been the task of political parties to represent interests. That is what political parties are—the representatives of certain forces in the State. The Tory Party, drawing a good deal of its strength from the rural areas, has been the traditional custodian of the farmers' interests, although it has not discharged its responsibilities very well on occasions, particularly between the wars. But that is how politics work, and the Labour Party, being the traditional custodian of the rights of industrial workers and their wives and families has the duty meticulously to examine everything pertaining to agricultural economics. I am glad that this subject is coming back into the political arena. It has been out too long. In a democratic society—and agriculture is part of a democratic society—politics are evolved on the basis of compromise between different pressure groups. There is this conflict between the industrial worker and the farmer, and let us freely recognise it. Both must be represented, and I make no bones about the fact that all through the last two years, when I have paddled a pretty lonely canoe, and thoroughly enjoyed it, I have been protecting the interests of my industrial workers. I also make no complaint that hon. Members opposite defend the interests of the farming community or the N.F.U., because this is a healthy thing. Now I do not intend to talk about the profits this industry has been enjoying for so long, because I think that by this time most people know all that. I have certainly done my best to let them know. I just say this. After the 1914–18 nonsense a favourite ballad of the time was "How are you going to keep them down on the farm." Nobody sings that now. The job now is to know how to keep them off the farm; how to keep the wrong type of person off the farm. I will develop that argument later on. Profits in this industry for the past two years have been in excess of £300 million compared with £55 million pre-war. Parliament has a particularly serious responsibility in agricultural economics, because so much of those profits are made possible by vast financial transfusions from the pockets of taxpayers. For example, last year direct subsidies to the industry were something like £36 million: this year they will be £48 million. From the Ministry of Food, of food subsidies of £410 million last year £245 million was for home-produced food, so that £245 million plus £36 million found its way into the pockets of British farmers.
Would the hon. Gentleman tell the House, in order that they shall not be misled, how much out of the £245 million to which he alludes went into the pockets of the farmers?
The whole of it.
Is the hon. Gentleman telling the House that the whole £245 million plus £36 million, a total of £281 million, went into the farmers' pockets by way of subsidies?
Precisely. That is precisely what I am saying.
Order. This is a debate, not a cross-examination.
The subsidies on home-produced food were £245 million, which means that £245 million was included in the sum paid to British farmers for their products. [An HON. MEMBER: "Nonsense."] What happened, of course, was this: We paid the farmers last year £36 million to subsidise production and to stimulate productivity and efficiency, and then, because what they produced was so high in price, we had to give £245 million by way of subsidies. I am saying that these vast sums passing from the pockets of the taxpayers into the pockets of the farmers do lay a specially important responsibility on Parliament to examine meticulously all these matters appertaining to agricultural economics.This fabulous position in which the industry finds itself does, in my view, bring great dangers which the House would do well to consider. The agricultural workers under the sagacious leadership of my hon. Friend the Member for Norfolk, North (Mr. Gooch), who sits beside me, have made very great gains in the last few years, and we are all delighted. It was quite time. But we see that a position can develop similar to that envisaged by Jack London in the "Iron Heel," if hon. Gentlemen opposite have ever read it. [An HON. MEMBER: "They have not."] A section of the community, because of its economic strength and because of the harmonious relationship existing between employers and employed, can hold the rest of the community to ransom. I do not suggest for one moment that position has arisen, but it could arise under less sagacious leadership than the agricultural workers now have. There could be a situation in which the farmers could in the February Farm Price Review demand certain concessions and obtain them, and, on the basis of these new achievements, the agricultural workers could then demand a bigger share of the pie. And why not?
But it does not happen.
I have said that; but it is a very dangerous situation that could develop. After all, if a case is to be made at the February Farm Price Review every year why not? It is a terrific temptation, to say the least of it.
Does not the hon. Gentleman's own argument point directly to the fact that he is inevitably driven to the conclusion that he must support the recent reduction in the food subsidies?
No. The food subsidies now are not making very much difference, because if the N.F.U. do not get it out of the taxpayer through food subsidies they get it out of the housewife through the increased cost of the contents of her shopping basket. It is a case of "Heads I win; tails you lose."There is another point about these February Farm Price Review negotiations which has to be borne in mind. The decisions arrived at not only have a tremendous influence on the livng costs of the working-class families in so far as home-produced food is concerned, but they also influence very considerably what we have to pay for imported supplies. Do not forget that Irish, Danish, Dutch and Argentine prices are all very closely related to British farm prices. I have sat down in negotiations with them, and the first thing they say, no matter what the commodity to be discussed—beef, mutton, butter, eggs—is, "What are you paying the British farmer?" That becomes the yardstick. That becomes the shillelagh with which they bludgeon one for the rest of the negotiations, so this February Farm Price Review is important beyond its influence on the home-produced contents of the British housewife's shopping basket. We on this side are concerned with two things.
Will the hon. Gentleman point out that he is only speaking for himself?
Rubbish: the hon. Member is talking for us as well.
Ninety per cent. of my party feel instinctively that I am right, but they have yet to arrive at a stage of intellectual conviction. It will be my task for the ensuing 12 months to convert them to the acceptance of the fact that all is not well with this industry.We are asking for a Royal Commission because we think that there are many aspects of British agricultural industry which give legitimate cause for misgivings. We do not intend any criticism, even by implication, of those who have been charged with the conduct of agricultural policy in the past few years. What we do say is that now that system has had a prolonged trial—
Does the hon. Member think that four years since the passing of the Agricultural Act, 1947, is a long trial?
I should have thought that it was sufficient to reveal the weaknesses.
Not to abolish it.
I have never urged the abolition of the 1947 Act, and I do not urge it now. I have asked, from the first moment when I threw the bombshell into the ring at Manchester in 1950, whether the system of guaranteed markets for unlimited quantities at prices which enable the least efficient and energetic to make profits was not concealing a good deal of inefficiency and inertia. That was the question I asked then, and it is the question I am asking today. It is a question which I and many of my hon. Friends feel can only be answered satisfactorily by a Royal Commission. We regard the National Farmers' Union as a price and profit boosting organisation, and we make no complaint of that; it is their job.The part played by the National Farmers' Union in the February Farm Price Review negotiations is the major part. [HON. MEMBERS: "No."] Yes it is. The other part is played by the Ministry of Agriculture.
And the Ministry of Food.
We had better not discuss that. What the Minister of Food counts for in the negotiations is nobody's business. It could be wrapped up in a piece of tissue paper.
My hon. Friend is talking rubbish.
The Ministry of Agriculture is charged with the well-being of the agricultural industry and, therefore, its views are usually identical with those of the N.F.U. To express it in current cold war jargon, one would not expect deviationists in the Ministry of Agriculture, for that would be the height of stupidity.There should be a widening of the representation in connection with the February Farm Price Review negotiations. The consumer should be represented. It may be said, that the Treasury is there, but we all know what my right hon. Friend the Member for Ebbw Vale (Mr. Bevan) thinks about the Treasury.
My hon. Friend will know what my right hon. Friend the Member for Ebbw Vale thinks about him in a minute.
We feel very strongly that it is wrong for the N.F.U. to be virtually judge and jury in its own cause in these negotiations.
Is the hon. Gentleman aware that before the negotiations start a committee is set up to decide the target for agriculture—the committee has on it representatives of the Ministry of Food, the Treasury and three other Government Departments—and when it has set the target the negotiators then have to break down the figure?
I am under no illusions about the N.F.U. Indeed, the N.F.U. command my admiration. In these negotiations they are like Manchester United playing Walsall; they are led by very able, smooth, ruthless men who know what they want and get it.The only trouble is that the consumer is not as adequately represented at the negotiations. My complaint is that the problems of the industry are being considered in isolation from the many conditioning factors which ought to be taken into account. I want to see the constitution of the February Farm Price Review altered.
The agricultural workers ought to be represented as well.
I agree that the agricultural workers should be represented at the negotiations. I should like to see the agricultural workers brought more and more into the scheme of things in the agricultural industry, for instance, on the county committees.I now turn to a few of the things to which I and my colleagues feel that a Royal Commission might usefully turn its mind. I should like it to address itself to a few technical questions. The Royal Commission would probably first want to establish whether it is true that the Dutch feed twice as many cows as we do on a given acreage and from those cows get twice as much milk. The Royal Commission would also probably want to find out how it is that the Danes can sell us a pound of butter for less than we pay the British farmer for a gallon of milk—
By breaking down the value of their own milk.
—when it takes 2½ gallons of milk to make a pound of butter. The Royal Commission would probably feel that if we could only get to know the secret of that very remarkable circumstance we should have gone a long way towards making the British dairy industry more efficient and might expect lower costs and selling prices.The Royal Commission would probably ask itself whether we ought any longer to send lorries to fetch milk in odd pails from remote areas at fantastic transport costs per gallon. If that practice were ended we should get a reversion to the traditional activities of such people, the rearing of store cattle and sheep. In those circumstances I should not oppose a subsidy towards the cost of transporting straw from the South of England, where thousands of tons are burnt or ploughed in each year, to hill farmers and farmers in remote areas to help them in their winter problem of feeding store cattle.
They would be poor cattle if fed on straw.
Having regard to the hundreds of millions of pounds spent in subsidies on milk alone in the past few years, it is scandalous that only 20 per cent. of our dairy herds are being recorded. The Royal Commission would probably want to find out why that is.I take a poor view of the milk business. It seems to me that the N.F.U. are milk-barmy. A gallon of milk was 1s. 3d. in 1940, and now it is more than 3s., and that is without the special payments of 4d. for T.T. milk and 4d. for the extra fat content. I can understand that, but the milk business worries me a bit.
In worrying about the price of milk, will the hon. Gentleman also have regard to the increases in the price of other commodities, for instance, sand and gravel? Can the hon. Gentleman give comparable figures for such commodities?
I do not sell gravel. I quarry and despatch to the length and breadth of the United Kingdom, to parts of Europe and to Australia and South Africa a highly technical product known as foundry moulding sand. Hon. Members opposite may say what they like about me, but they must not denigrate my product in the social register of sand.
I apologise to the hon. Member's product, if not to the hon. Member, and I ask him to give us the comparison between the price of his product and the price of milk.
I was hoping to sit down shortly, but I am being subjected to interruptions, which has not been the case with other Members speaking this morning. The milk business is very worrying to me. It seems to me that we are entering this new robust Elizabethan era with a queer Jolly Roger at the mast-head bearing the words, "More milk and no boxing." I do not know what Drake and Hawkins would have thought about that.I want to turn to perhaps the most important aspect of this farming problem. It seems to me that this industry has virtually become a closed shop, except for the very wealthy—or, at any rate, the wealthy. I am one who believes that there is no incentive like the desire to improve ourselves. For that, men will keep hustling from the crack of dawn until after day is done. That is something I want to see encouraged. That is the type I want to see entering this industry on an ever-increasing scale. But can they? Can the ploughman, the cowman, the foreman, or the bailiff of a farm do it today? Are there any who can look forward to one day being master of their own farm? Is there any opportunity for agricultural students coming from the agricultural colleges, from the farm institutes and from the universities? Does anyone in this House see any possibility of these bright young things— bursting to "have a go"—getting the opportunity? No, the fact of the matter is that every farm that is coming on the market is being bought by queer folk. I said before, and I do not want to repeat myself, that radio and television stars, ex-naval officers and company directors are doing this. These are not the people who will give us the efficiency and production we need. These are the absentee landowners taking the place of the 19th-century nobleman. He has gone, but he is being replaced today by industrialists with excess profits to get rid of. The first thing I should ask the Commission to look at is whether it would not be a good thing now to make it impossible for a person to set his losses sustained in farming against profits made in industry, or commerce, or one of the professions? Would it not be conducive to farming efficiency and productivity to make each farm stand on its own feet? Today, if a man earns £5,000 in engineering and loses £2,000 on a farm, he pays tax on £3,000. By State subsidies and by arrears chargeable as expenses for Income Tax purposes he gradually builds up the value of the farm. If he wishes, at the end of a number of years, having made no profit at all, he is able to sell the farm at an enhanced value which again is tax-free. I want the Commission to examine that. I want the Commission to examine the question of whether this 40 per cent. concession on Death Duties is any longer in the national interest.
Is not the point of my hon. Friend's argument now, and has it not been for several years, not that people lose money in agriculture, but that they are making excessive profits?
Yes, but, of course, there are Income Tax allowances in the agricultural industry—about which the Parliamentary Secretary will know more than I do—which are not permissible in industry generally.
Could the hon. Member explain why I should know more about them than he does?
What is the hon. Gentleman paid for? For example, on farm buildings the farmer is allowed to write off the capital investment in 10 years, but the engineer building a factory has to spread it over 50 years. Certainly, there are many great advantages. I want to ask a question about this 40 per cent. concession on Death Duties, because this is very important. As I understand it, if a man who has £1 million invested in stocks and shares, house property, or Government bonds, dies, his estate would be £340,000 worse off through tax than the estate of a man who had the whole of his £1 million tied up in agricultural land. That is the law as it stands.One can understand that in the old days it was thought that the continuity of ownership was a good thing, but in my view continuity of ownership today is meaningless. Farm rents today are less than they were in 1870. There are very few landlords indeed who can afford to keep their estates in decent repair, never mind about providing extensions which are necessary and desirable in the interests of agricultural expansion. Who will deny that? In these circumstances, the old argument for giving this vast concession in the matter of Death Duties has lost its validity. I would like to see a greater break-up of large, inefficient farms in this country. I think that is the only way by which we could provide those young, vigorous, elements—of which I spoke earlier—with farms. There is a lot of poppycock talked about the efficiency of large farms. It may be that large arable farms are all right, but what advantage is there in a 1,000 acre farm split up into 10 acre fields? Hedges and ditches largely decide the pattern of the British agricultural industry. I say there is no virtue in largeness by itself. I do not know how we shall improve the efficiency of this industry without fresh thinking, without new ideas, and without new blood. What worries me, and those who think like me, is how we can get those young people—bursting to "have a go"—on to the land. I would say to this Commission, "We want you to examine whether the time has not now arrived when the further transference of agricultural land to private ownership should be prohibited." This is dynamite, I know. The Commission might consider that a rental should be assessed on the farm on the basis of its being farmed efficiently—it may be £300 a year—and it may be that the farm would then be transferred to the State as freeholds are sold today on the basis of so many years purchase. It may be 30 years' purchase and the purchase of the farm may be £9,000, and at that figure it would pass to the ownership of the State. It could then be let to one of the many thousands of these young people who are in the queue at the moment. I would now, straight away, impose a test for the ownership and control of land. We do not let people career along the street with motor cars without having satisfied ourselves that they are fit to drive a motor car; that they will not be a menace to the community or to other road users. Yet anyone who has the money can buy a farm and waste our most priceless asset at a time of great national emergency. So I would invite the Commission to consider whether the time has arrived when the transference of the ownership of agricultural land to private individuals should be stopped. In any case, I would insist that there was some sort of test applied to their fitness to farm. This, as I see it, is the major problem; how to get new blood, new ideas, and fresh thinking into an industry which is suffering a little from Anno Domini. There is about this industry a peculiar psychology. I might describe it as "Come day, go day, God send Sunday." There is a complete inability to understand that this country is by no means certain of recovering its place in the world. There is no special reason why we should not now gradually recede to the status of Spain and Portugal each in their day world Powers of the first order. As I go round the countryside I find very little realisation of the gravity of the situation. So I would say to the Minister and to all connected with this industry, "You have it in your power, you and the miners, to create conditions in which the Foreign Policy of Great Britain is no longer hostage to American charity." These two industries more than any other have the capacity to give back to us our financial independence and self-respect. I wish the industry well. I am no enemy of the farming industry. No one wishes to see a stable, healthy, vigorous British agricultural industry more than I do. And it is precisely because I and those whose names are attached to the Amendment think that a Royal Commission to examine all the aspects of the industry would be helpful toward that end, that I am moving it.
I beg to second the Amendment.Whatever we may think about the thesis of my hon. Friend, we are bound to acknowledge that he is a man of good humour and toleration. For the life of me, I cannot see why we should not examine a matter of such moment to the whole country and to every family in the country, or why we should not, so far as possible, take a quiet and objective view. I cannot understand why we should bandy about personalities and consider what my hon. Friend the Member for Wednesbury (Mr. S. N. Evans) does for his living. I fail to see the point or the necessity for it. I think it is very discourteous. Farmers have, of course, an interest in this matter which has to be properly considered. Of course, the great army of farm workers have a vital interest in this matter, and as my hon. Friend has so rightly said, it is none of our case that we wish them ill. In fact, it seemed to be news to some people that under some circumstances, and under proper arrangements, my hon. Friend is prepared to accept guarantees and subsidies and long-term planning. So let us at once get it out of our minds that in the circumstances in which we find ourselves we come here with great criticism of the Agriculture Act, 1947, which has been described as the farmers' "charter" or "bible," still less of the way in which it has been implemented. That is not the case before the House today. The case is how we can best arrange the economic life of this country in view of all the circumstances, in terms of the world position in which we find ourselves? How best can we utilise our resources? How best can we hold the balance of what should be done in the field of agriculture vis-à-vis what should be done in terms of industrial production? I know that some of my hon. Friends have criticised the proposal for a Royal Commission as being unnecessary. They say that we have machinery at our disposal for examining the background and nature of the problem. I should have thought that busy men, and particularly Members of Parliament, who lead extremely busy lives these days, have neither the time nor the facilities to go into this matter in the way in which it should be gone into. With a Royal Commission, there is an opportunity to call for persons and papers; to seek the best advice; to judge from the experience of other nations, as my hon. Friend has said, and to examine the matter quietly and objectively; in fact, to establish the facts. That is all we are asking for today. It has been conceded that there are matters in the present set-up which give us cause for apprehension. That is in the nature of the problem and it may be divorced from any individual interest. For example, the hon. and gallant Member for the Isle of Ely (Major Legge-Bourke) conceded that in some circumstances production had not risen as he would have liked it to do. He conceded that certain types of farmers are short of working capital. He made some reference to the great amount of difficulty that farmers may have to face because of the increase in the Bank rate, and so on. These are very real problems. The hon. Member for Ashford (Mr. Deedes) said, as I understood, that formidable results were arising from the present system. After my experience of serving on the Select Committee on Estimates some three years ago, and taking some interest in this problem, I am convinced that there are matters which require investigation. When we had the county executive business before us, and the officials before us, there was much discovered which called for question and misgiving. I do not say that anyone especially is to blame. Here was a position which had arisen in conditions of emergency, where men on a voluntary basis and at great sacrifice of time had given service. But there was a wide discrepancy in the results produced in several counties. Certainly, in the matter of the machinery service, in the provision of labour and hostel accommodation, and in matters like pest control my hon. Friend the Member for Chorley (Mr. Kenyon), who is a working farmer, would agree that there were variable results in one county as compared with another. We should remember what was done with the capital made available under the land drainage and reclamation schemes, with discouraging results.
My hon. Friend has mentioned that a Select Committee did a certain job. Would he not agree that it is preferable to have that type of machinery rather than the clumsy machinery of a Royal Commission?
On reflection, I think that the problem is rather wider than the terms of reference which we had in mind on that Select Committee. My hon. Friend might say that they could be widened to cover the task we are discussing. This problem is bigger than the work which any small body of people could do without expert advice and a lot of time at their disposal.I want to put this matter in its proper context. This is not only an internal problem. It must be taken in the context of a world situation which bristles with difficulties. We must take into account what production is likely to be elsewhere. Consideration of these questions will occupy a great deal of time. The ordinary working politician has certainly not got the time to do this.
Surely a Royal Commission would not take evidence from outside. I should have thought that the data was here in this country.
They could go wherever they liked for useful information. I have no doubt that under the Commonwealth arrangement, and under the international arrangement with U.N.O., facilities would be placed at their disposal. This would take a great deal of time.My hon. Friend the Member for Wednesbury referred to specific implications within the industry. He said that certain types of farms were more fertile than others. He doubted whether the sizes of farms were just right. He referred to difficulty in getting young blood into the industry. He reminded us that when farms come into the market the highest bidder gets them irrespective of his qualifications. What is the result of that? It is inflationary. A man may start off in a modest way and improve a farm. It may then be put on the market and its value may be five or six times the price paid for it. Who pays in the long run? The man must recoup himself. He must get some return on his money. Naturally, if he is a member of the National Farmers' Union or of some other farmers' organisation, he must press for some arrangement to be made for him to get some return on his money. The ultimate result is that the price of the commodity to the consumer goes up. Is not that obvious? But, unlike what we hoped under the 1947 Act—
Does the hon. Gentleman mean that there is some other increased charge resulting from the cost of the freehold property, other than a rent charge? The point has already been made that rents have scarcely risen at all in the past 50 years. Only the question of the rent charge arises out of the higher purchase price for property.
I know what my hon. Friend said about rents not having risen above approximately 25 per cent. That fact was quoted in the "Economist" some weeks ago, and it has not been challenged on either side of the House. That may be a bad thing about the industry. It is certainly out of relation to all the other costs. A small-holding might come on to the market. It might have been worth £600 or £700 10 years ago, but it cannot be bought at that price today. It will probably cost between £3,000 and £4,000, to say the least.The Parliamentary Secretary must know that when the big estates belonging to the so-called landed gentry are broken up they fetch very fancy prices, in some instances. The money is available, and I do not see that anybody is to blame for that.
May I make my point clear? The hon. Gentleman's argument was directed to showing that these high purchase prices cause an inflation, because the man who pays them then calls upon the National Farmers' Union to ask for higher prices at the annual price review. The results of a high purchase price for a farm will only be reflected in the rent charge. If the rents have not been put up, as his hon. Friend has told him, there is nothing in the hon. Gentleman's argument.
As the Parliamentary Secretary has dragged me into it, I should like to say that it is true that I said that rents are no higher than they were in 1870; but today people do not buy farms to let. They buy them to farm. To the extent that an inflated price is paid for a farm, the interest charge on inflated charge has to be built into the selling price of the goods the farm produces.
What the hon. Gentleman has said is completely wrong. What enters into the farm account presented to the Income Tax office is the Schedule A assessment, which is not based on the price given for a farm.
Never mind about Schedule D or B, or whatever it may be. This condition prevents young men from coming into the industry if they have not got the money.
Does my hon. Friend appreciate that the provisions about smallholdings in the Agriculture Act specify that loans of between 70 per cent. and 80 per cent. of State money can be provided for a farm worker if he wants to embark upon a smallholding? Therefore, no young farm worker applicant is deprived of his opportunity because he has not got the money.
That may be so—[HON. MEMBERS: "It is so."]—but the practical result is that many men are not willing to commit themselves to these high prices.
Yes, they are.
It is a fact that many people with no farming experience push out the good men with the new ideas which we need badly in industry. Hon. Members can talk it out for as long as they like: the fact is there.Subsidies are a blunt instrument. As has been said, they do not do the job they were designed to do. They cover up inefficiency and do not encourage maximum production. They take too little account of outside factors. As my hon. Friend the Member for Wednesbury said, he objects to a deal between the N.F.U. and the Ministry of Agriculture—and I would add or the Ministry of Food and the Treasury. I share my hon. Friend's view that the workers themselves ought to be represented in these negotiations. Their livelihood is at stake. Certainly, consumers have a great interest in this question. Although the agriculture industry is most important, although it contributes about 5 per cent. of the national income, and although 6 per cent. of our population are engaged in the industry, there is a great urban population over and above this whose interests must also be considered. Conditions are not static, as anybody, whether he is or is not a farmer, knows. The position should be subject to constant review in the light of experience. The knowledge built up over the last three or four years has revealed some weaknesses. There was always a danger, in a system of guaranteed prices, of a rigid, inflexible system which almost amounted to old-time protectionism. I agree with much of what my hon. Friend said, although I thought, when he said that the workers were holding up the community to ransom, that it was the industry, including the farmers, who might, in certain circumstances, hold up the country, particularly the great mass of the urban population, to ransom. I do not think that the workers would be responsible for that. I would give the workers an increasing interest in this matter. I am not satisfied with the representation on the county executive committees, and I do not think that it is a fair balance of power that there should be only two representatives of the workers. I think these practical men should have a greater say in the development of the industry, not only at the county and district levels, but at the executive level. What I am saying, apart from these domestic matters, is that the economy of the industry has changed and that we are no longer likely to get cheap food, as we did in the last quarter of the 19th century and onwards. We do not want it at the price of depressing labour conditions either in this country or overseas. The days of the cheap loaf have gone, and there is no prospect of them ever returning, for various reasons. The standard of life is rising all over the world, people are consuming more of their own products and they are also industrialising their own countries, like Australia is doing, with the result that the products we previously received from them are no longer to be available to us. In these circumstances, we have to decide what is the optimum, in terms of agricultural production, at which this country should aim. Hon. Gentlemen opposite are asking for a long-term policy, and I agree that the farmers are most apprehensive about their security. One hon. Gentleman has reminded us of the danger of deflation, and it may well be that, although there are hungry millions, food prices may fall. They have fallen before, and there have always been millions of hungry people. We start from this premise: that there must be some sort of future security for the farmers and workers. We have found, from the experience of the last three or four years, that certain weaknesses have revealed themselves and we say that those weaknesses should be fully investigated. If the taxpayer is called upon, as he is, to pour out much money on what I regard as a social service—and I have no objection to it—the weaknesses should be removed. In some circumstances, I could make out a good case for a subsidy in respect of transport, just as I could in respect of health and other matters of public interest, and certainly in respect of food. There is a very good case, in terms of a social service, in regard to food, and that is our complaint to the party opposite. The situation with which we began in 1947 has seriously changed during the last few weeks, owing to the coming into power of a Conservative Government, because they are cutting down the subsidies, and what we are fearful of is the ultimate price which people will have to pay for bread, butter, cheese, and so on. We are supposed to have an annual Price Review. What happens at this annual review? What is happening behind the scenes? What is the cause of delay? Is it too much to say that a great argument, a great wrangle, a great tug-of-war is going on behind the scenes? Is it too much to hazard a guess that the producers of milk are not satisfied with what they are being offered? Of course, it is not. There are conflicting interests here, and somebody has to adjudicate. The complaint we are making is that the tribunal or committee at present dealing with the matter is too narrow and too constricted in the representation of the interests concerned. Is that a reasonable deduction? [HON. MEMBERS: "No."] I submit that it is. I have here a quotation from the "Economist" of 19th January, 1952, which says:
Then, the "Economist" goes on to say:"The National Farmers' Union will be in a sombre mood for its annual general meeting next week. A spate of resolutions deplores what is regarded as the failure of prices to keep pace with rising costs. There is even a suggestion that the Union should retire from its price negotiations with the Government if its claims are not met. One resolution suggests that additional payments should be made to that group of farmers who 'are compelled in the national interests to farm at higher proportionate costs for lower than average yields.' This proposal gets nearer to the basic problem of raising agricultural production. The period of agricultural expansion seems to have come to an end, and the farmers will argue that only a substantial rise in prices can 'restore confidence' in the industry."
That is the farmers' own view, not that of my hon. Friend the Member for Wednesbury and his supporters, but the view of a paper which is not unfriendly to the farming and agricultural industry or even to the party opposite. The simple thesis that we are putting forward is that the incidence of aid on the present set-up is of too much a hit-and-miss character."The nation certainly needs more homegrown food, but, equally certainly, it cannot afford the cost of paying higher prices all round to farmers who are already making good profits as well as to those who are not. If the Union wishes its conference to be constructive, it should concentrate its discussions as much as possible towards working out methods for raising the output of many backward farms in Britain. The problems involved are considerable, and there can be no question of squandering public money on inefficient farmers, but there is a case for selective aid to those farmers who lack sufficient capital of their own to expand production."
The argument of the "Economist," surely, in no way contradicts the general policy of the last Government? They passed a Hill Farming Act, and other Acts of that kind. That is the answer, and we do not need a Royal Commission to attack those things.
No, but it is generally understood. I think my hon. Friend has been studying with me recently a little booklet issued by the Department of Agriculture, which Mr. C. H. Blagburn, of the Department of Agriculture, wrote, and in which he makes specific proposals for the injection of capital which would yield handsome results in certain cases. There is no doubt about it that, if we are to increase production, there are some farms which must be assisted, and that is the point of the Amendment. I say that these matters are all questions for further investigation, and that we have neither the time nor the facts to say what should be done without further inquiry.Therefore, I leave the matter at this point, as there are other hon. Members who wish to speak. I say that, while we are appreciative of the great job which is being done by the farming industry, largely under the inspiration and leadership, as the "Economist" has well said, of the Labour party, as compared with the years of dereliction between the wars—[Interruption.] It is a perfectly sound argument, and I have submitted the view of the "Economist," which is not only my own view, but that of everybody who examines the matter objectively, and I think myself that it is a fair statement of fact. Although a great job of work has been done in increasing food production by 40 per cent. over pre-war I think my right hon. Friend the Member for Don Valley (Mr. T. Williams) would agree with me that we wish we had been able to do better and that it should be possible to improve production. I am sure my right hon. Friend shares that view and that there is no quarrel between us on that point. We wish that experience in the industry should be examined by a Royal Commission in a way in which a handful of volunteers fully engaged in earning their living cannot hope to do. The Commission would have power to call for persons and papers, it would have all the evidence before it and could have the help of the Civil Service in preparing its report. The Commission should investigate the industry with special reference to such things as the reaction of increased charges upon production. It could discover whether in some circumstances the proper incentives had been provided, whether some people were jogging along comfortably on their moderate income and felt it was not worth while exerting themselves because of Income Tax. The Royal Commission could consider whether farmers had been unwilling to expand capital investment for various reasons, and it could study the effect of the present economic situation on the industry. We should support the policy of bulk buying by the Ministry of Food and the policy of long-range production and security for the cocoa farmers in West Africa and agricultural producers in Australasia. We can do that in relation to our own planned production. This is a matter which can only be looked at from an international point of view and all our efforts should be bent to attaining the maximum production at the least possible cost. If that were done we should have the good will of all men. We on this side of the House certainly appreciate all the efforts the agricultural workers have made up to date and we have no desire to see their conditions worsened in any way. Nor would I cast stones at the farmers. Many of them are dissatisfied with the present arrangements. There are wide differences of view on these matters, and the opportunity should be provided for them to be resolved in a proper way.
This is the first time I have spoken in the House, and I am sure the hon. Member for Stoke-on-Trent, North (Mr. Edward Davies), will forgive me if I do not follow him. I am sure too that he and the hon. Member for Wednesbury (Mr. S. N. Evans) will forgive be if I do not say very much about the Amendment. I feel that if I did so I should be bound to transgress and become controversial, and I understand that that would lose me the indulgence of the House of which I am in such grave need.Therefore, I shall confine myself to a few matters of special importance which I believe should receive our consideration when we are discussing an increase in agricultural production. I should like to start by thanking my hon. and gallant Friend the Member for the Isle of Ely (Major Legge-Bourke) for having made such good use of his luck in the draw. I thank him partly, of course, because he has given one who has the honour to represent a constituency which is very largely agricultural a wonderful opportunity to make a maiden speech. I thank him too because he has framed his Motion in such wide terms that it will be difficult for me to go outside it, but if I should do that I hope very much that you, Mr. Speaker, will be kind enough to be lenient. But I thank my hon. and gallant Friend mainly because I am quite convinced—and I gather that this at least is not controversial—that our national well-being demands that our farming industry produces more and more of our food. If that is to be achieved, it is essential that as far as possible the farmer should be protected from uncertainty. Uncertainty is the bugbear of farming. There are many uncertainties from which the farmer cannot be protected—in particular the weather in this country—but there are uncertainties in respect of which Government can and should help. The first of these uncertainties is uncertainty about the prices which the farmer will receive for his product. The Government can help there by giving him a certainty about price, not just confined to the current year but spread over several years and providing him with the assurance that he can plan ahead. It is far too often forgotten that farming is, of its very nature, a long-term business. We in this country are still suffering from the effect on our sheep population of the disastrous winter of five years ago. I hope the Minister will give this certainty of prices over a period; but that does not mean he need necessarily fix named prices over that period. Would it not be possible to work out a "farm cost of production index" and then guarantee to the farmer a minimum price, of perhaps 2½ per cent., over the average cost of production, which he will receive for his product for a term of four or five years? I ask my right hon. Friend if he will consider that, because it will not only safeguard the Government against a fall in costs, but will also encourage efficiency in the farmer and encourage him to plan ahead. But certainty about prices is not enough. He must also be certain what he is expected to produce. A farmer in my constituency said to me the other day, "It does not matter so much what I am asked to produce; what matters is that I should know I shall not be asked to produce something quite different at a moment's notice." I hope the emphasis will continue to be placed on the raising of livestock and the growing of feedingstuffs. The climate of this country as a whole is more suited to that than to the growing of cereals for human consumption. Certainly that is true of South Shropshire. I trust that the ploughing-up grant which my right hon. Friend has brought in will do its job in ensuring an increase in home production of feedingstuffs. But I think the mere fact that that grant had to be made so late in the season is proof of what I am saying. It was occasioned because of a sudden change in emphasis. If the farmer is to be given certainty of prices and of production policy, then the Government must take steps to see that he is not allowed to take undue advantage of the benefits which are conferred upon him. I am not worried in this connection about the farmer who makes big profits by high efficiency and hard work. I believe that profits are the right reward for efficiency and hard work, and if the profits are so big that some social evil may flow from them, I believe that the Chancellor of the Exchequer is well able to look after that. I am not worried either about the bad farmer who wastes his land. There are provisions in the Agriculture Act, 1947, which can look after him, though I think that those are perhaps somewhat too sparingly used at present. I am worried about the farmer who is just a little under average, the farmer—and there are many of his kind—who is just ticking over—not idle, but not really hard-working. What can be done to persuade him to increase his efforts? Local opinion can undoubtedly do a great deal, and so can fear of dispossession, particularly if the rules regarding dispossession are rather more rigidly enforced. But I myself prefer the carrot to the stick, and I believe that the way to persuade that sort of farmer to produce more is to let the incentive of profit play its full part. It will not work to the full unless the farmer is freed from various uncertainties. The chief of those uncertainties is the uncertainty about where the money is coming from, uncertainty about credit. It is often not sufficiently realised how much working capital the farmer requires and how slowly that working capital can be turned over. It is not an outside figure to say that it may cost £800 to finance the cropping of 10 acres of potatoes. Many farmers are worried today and are not inclined to plan ahead because they do not feel that they can be certain of getting the credit which they will require for working capital. "After all," they say, "the banks have been told to restrict credit." The Chancellor—and our thanks are due to him for this—has made it clear that the banks should give full weight to the importance of agricultural production, especially where increased tillage area and increased food production are concerned. Although I believe the banks are paying heed to what the Chancellor has said, it can be seen that the seasonal increase in farm overdrafts, which normally takes place between November and this time of the year, is very much smaller than normal. It is not increased profits that have brought this about. Another thing—the farmers are leaning more and more on their suppliers for credit. A corn merchant in my part of the country told me the other day that he thought that the average farmer was requiring today twice the length of credit which he required in the not too distant past. I am certain that this question of agricultural credit for working capital is one which must engage the serious attention of my right hon. Friend. The last uncertainty about which I want, to speak is the uncertainty of the supply of labour. In this connection I want particularly to talk about the National Service call-up. I say at once that I would deplore the mass exemption of farm workers and farmers' sons from their obligation to do National Service. It would damage farming and I think it would harm the Services. It would damage farming because nothing could do more to create ill-feeling between the agricultural industry and other industries. It would harm the Services because not only would it decrease the numbers of their intake but it would seriously lower their quality. I believe that a relatively small change in the present regulations of the Ministry of Labour regarding the deferment of agricultural workers would ensure that agriculture was not deprived of men whom it could not afford to spare for the period of their service so long as they return to farming when they came out of the Army. It is the danger of them not coming back that frightens me. So far as I can see, there is only one answer to that problem, and that is to improve rural amenities. It is my firm belief that there is no occupation which is more worth while or more likely to bring about happiness and health than work on a farm. But a great deal of that work has to be done on one's own. As we get older many of us may find that prospect more and more attractive, but the young man of 18 who for the first time finds the pleasures of communal life, may well be loath to leave that communal life and return to comparative solitude at the age of 20. As I say, I believe the only way to solve the problem is to improve rural amenities. In the first place, we must ensure that adequate wages are paid and that the terms of service are satisfactory. Above all, the problem of rural housing must be faced. I welcome the provisions of the Measure introduced by the Minister of Housing and Local Government, and I should like to bring to his notice the position of local authorities and other people in remote areas where the distance which the builders and materials have to be carried add very considerably to the cost of the houses. Those are the four uncertainties to which I wish to refer; the uncertainty of price, of policy, of credit and of labour. I believe that all those uncertainties can be dispelled by Government action. They must be so dispelled if we are to ensure the increase in home production which is essential for economic and strategic reasons. But there is another and perhaps even more compelling reason for making our agriculture flourish. If a man is cut off from nature; if he begins to think that food is not something that has to be grown but just something that can be bought in a shop; if he forgets that the sunshine and the rain, the summer and the winter, are vital influences in his life, over which neither he nor any other man can have any control; if he forgets that, I think he will inevitably lose his sense of proportion and his sense of values. What is true of the man is true of the nation. May we never lose touch with the truest realities, which we will surely do if we fail to cultivate our garden.
I think the House would desire to offer congratulations to the hon. Member for Ludlow (Mr. Holland-Martin) on what I regard as a very thoughtful speech, although I am not in entire agreement with everything he says. He comes from a very great agricultural county, though not so great as mine. I hope we shall hear more from him in the course of agricultural debates.This Parliament is not very old, but it has already dealt with a number of subjects. But the time devoted to agricultural matters has been very limited. There are few matters of more importance at this time than making certain that we can produce all we can from our own farms. During the course of this debate many critical things have already been said about farmers and other people. I may say a few critical things myself; but I hope that we are going to end by endeavouring to be both objective and constructive. My hon. Friend the Member for Wednesbury (Mr. S. N. Evans), who has now left the Chamber, has moved his Amendment and has had a good time, as he always does. The criticism I want to pass upon this little team on my left is the fact that there is really no team-work among them before they come into the Chamber. Much of what the hon. Member for Wednesbury had to say was contradicted by his seconder. That is their business; not mine. The plain fact remains that if my hon. Friend the Member for Wednesbury claims that 90 per cent. of my party support his views, that is utter nonsense. If 90 per cent. of my party support his views, it is a pity that his little party, when making criticisms of British agriculture, do not make certain that they are all in agreement before coming into the Chamber and taking part in a debate of this kind. I expect the hon. Member for Wednesbury will hit the headlines again in the morning; but I wish he would occasionally give his mind to dealing with what, after all, is the very critical food situation that faces us at the present time. The line he takes today, and has always taken, is a temptation to me; but slanging farmers in the bunch will not take us anywhere. I know, because I have been doing a bit of that these last 35 years when I thought the farmers needed it, and I am prepared to do a bit more when the circumstances warrant it; but we are all in this business of food production together, and if some people are making fortunes out of food, we can devise ways and means of putting the brake on without setting up a Royal Commission. At the same time as we are attending to the man who is making a fortune out of food production, I think we should give a thought to the thousands of small farmers who are still the backbone of British agriculture—and the thousands of farm workers, the most patient of men, whose sole desire is to give of their best in return for a fair reward. I wish to place on record today the fact that there has not been a strike in British agriculture for 30 years. I am very grateful to the hon. and gallant Gentleman the Member for the Isle of Ely (Major Legge-Bourke) for putting down this Motion today and for providing us with the opportunity of discussing a very vital subject, which is not only of importance to Britain's economic recovery but to the well-being of the whole population of these Isles. I am glad to hear my hon. Friends admit that the days when we could import cheap food from abroad have gone. I did not think that had dawned on them until today. Those days have gone and, in any case, cheap food from abroad always came here at the expense of the British farmer and farm worker. At the time of the last Election there was some talk about "scouring the world for food." Some of the hon. Gentlemen who said it are sitting opposite today. They said it in my constituency. They are the party in power, but the promise they held out that they would scour the world for food has not yet produced very impressive results. The fact is that the people who talked, prior to the last Election, about scouring the world for food knew very well when they talked like that that the food was not there to be secured. The food situation abroad has a very distinct bearing upon the food situation and the effort required in this country. In few countries does food production keep ahead of population. In most countries it lags woefully behind. It has been my privilege to see something of the inner working of the Food and Agriculture Organisation, by attendance at conferences in Quebec, Copenhagen, Washington and Rome. I am glad that changes in government in this country have not affected Britain's attitude to the worthy objective of this specialised agency of the United Nations. We are in this organisation not so much for the purpose of helping ourselves as for helping the backward and undeveloped countries to help themselves. I recall the Director-General of F.A.O. saying that "grim" is still the word for the world food situation. I had the pleasure of hearing the noble Lord who represents the Ministry of Agriculture in another place, in a speech at Rome a few months ago, say
We must certainly succeed if we are to win this war against want. In this connection, a very serious duty devolves upon all food producers in this country. I appreciate that there are varied views as to how we can produce more from our own farms, but it is quite evident that more can be produced. Even the advocates of a cheap food import policy now realise that it is as impracticable as it is unfair to the tillers of our own soil. I warmly support that part of the Motion which declares that the"Many problems and difficulties will arise. We must foresee these problems. We must prepare our plans. We must above all be practical. We must conduct ourselves with courage and resolution, and we must succeed."
The hon. and gallant Member went on to advocate a four-year food production plan—and that has been taken up by other hon. Members. I think some such plan has been in existence for a very long time. The Agriculture Act, 1947, provided for assured markets and guaranteed markets over a period of years. It is true that the emphasis has had to be changed again and again to meet changed conditions both here and abroad, but the twin in pillars of the Agriculture Act—confidence and security—stand today. I am rather tired of hearing so many people say that food production in this country is declining because farmers lost confidence in the agricultural policy of the Labour Government. If some lost confidence in that policy, in my part of the country they did not lose money. In this connection, generally speaking, under the Agriculture Act, 1947, and under the Labour Government, they were having a good time, to which they were absolutely entitled, and as much entitled as are the manufacturers and merchants and those who sell sand and ballast."health, wealth and happiness of the British people depend first upon the ability of British farmers, growers and farm workers to produce, with the highest efficiency, the greatest possible amount of high-quality food."
My hon. Friend will have his chance. I have been listening to a good bit of slanging—
But not personal.
And I am sure that, when I represent 200,000 farm workers in this country whose livelihood is at stake, I am entitled to reply. In any case, I shall do so whether my hon. Friend likes it or not. It is all very well to talk about milk and egg men being badly treated and to call for long-term agricultural development, but the time has come when we must deal with those things which hinder production and must make certain that in doing so we have the urban population with us. Despite what has been said today, I have held for a long time that the prosperity of the countryside and the towns is completely inter-dependent. There should be no gulf between town and country. We of the countryside are no longer the townsman's poor relations, and we never should have been.I have heard advocated in the House the complete abolition of controlled prices. That might give the farmers a short-term advantage, but it certainly would be short-term, and I should personally regret any attempt to undermine the 1947 Act. It benefits the farmer by giving him stability. It also benefits the consumer by ensuring a continuous supply of food which could not be obtained elsewhere. Indeed, I do not expect any legislative upheavals on farming policy consequent upon the change of Government. May I quote briefly from the Quarterly Review of the Royal Agricultural Society of England? It says:
"With a new Government and another Party in power it is fortunate that we need fear no drastic upheavals or reversals of national policy towards the land. As the two historic conferences organised by our Society demonstrated, when every interest in agriculture was represented among those who were called to them, the broad outlines of agricultural policy for Britain stand outside party-political considerations.
In general, there are only certain right things to do where the land is concerned, and although there might be minor trimmings added by the Left which the Right would never have introduced, and vice versa, the foundations of Britain's approach to the land stand today on non-Party lines, and are the more secure for doing so. The nation, as well as the farming community, are immensely the gainers by this, and therefore it would not be out of place to pay our tribute to Mr. Tom Williams, the outgoing Minister of Agriculture, for his contribution to it.
I think I should read on:No Minister, and certainly no Minister of Agriculture, can expect to escape criticism; and no Act as comprehensive and fundamental as the 1947 Agriculture Act which he fathered can be expected to spring into perfect and eternal being without the need of later amendment in some minor respects. But in introducing this Act with the interests of the land so obviously its prime consideration, with such wide consultation with all the interests concerned, and with such care to put practical considerations before the theoretical tenets of any particular Party, Mr. Williams rendered a service to the land that outlasts his Government and ensured that he will be remembered in history long after some of his more spectacular colleagues are forgotten. No other man has ever been Minister of Agriculture for so long. What is even more surprising is that he was more popular at the end of his reign than at the beginning."
I gladly join in the tributes which have been paid, not only the one I have read but in other quarters, to the work which was done by my right hon. Friend when he was Minister of Agriculture. May I hasten to add that he did not always do what I wanted him to do? Indeed, on one occasion during the passage of the Agriculture Bill upstairs through Committee, he resisted my demand and called upon his and my colleagues to vote me down, and this they promptly did. It is as well to emphasise that the Agriculture Act brings not only guarantees but also obligations, and the obligations must be discharged in return for a continuance of the guarantees. It may be necessary to look again at the Act, but it is not necessary to supersede it. Meanwhile, we have to step up production on established farms and bring into production other land now little used. I agree with the Minister that, the call for greater output for better-managed resources is a challenge to the ingenuity and virility of the farming industry. I want to hasten to add a few remarks on certain details which have been discussed today. There is much to be said for a policy determining land use. Much good farm land is being lost to nonagricultural purposes. But we must pursue this matter with caution. In the inter-war years, when farms were two a penny, the subject did not arise. We must bow to social demands and we must not hinder social development. I am very, sorry, and I shall be, when good farm land is lost to farming, but I should be more sorry if efforts to meet housing needs were hindered by unwise land planning. I am glad to know that a joint deputation is likely to meet the appropriate Minister to discuss this matter, and I hope we shall be able to work out a basis upon which this very urgent matter of land use can be dealt with. The prosperity of farming is worrying to some of my hon. Friends—quite a number of my hon. Friends. The policy of a flat rate for each type of farm produce over the whole country, without due consideration being given to the infinite variation in the level of farming costs within the country, results in some farmers doing better than others. In order to provide a sufficient incentive to the farmer of poor and outlying land to continue farming at all, it has been found necessary to fix farm prices at a level which enables the farmer of fertile and easily accessible land to make a small fortune. I imagine that the tax collector keeps an eye on him, but perhaps another and more satisfactory method of price fixing can be devised. It may be that some of the incentives to increased production are wrongly conceived. I have in mind the £5 per acre subsidy for ploughing up old grassland, which has rightly been described as pandering to the inefficient. I agree with that summing up. It encourages the farmer who has not done his best, and discourages the man who has done his best to get on with the job. The question has been asked whether the drop in some lines of production has been due to over-favourable prices which allow farmers to live quite well without getting the highest possible production. Is it due to funds being too low to justify more production of expensive and risky lines of farming? I want to pass that on to the Minister as a point deserving consideration. Like my hon. Friend the Member for Wednesbury, I, too, am concerned as to the number of wealthy industrialists now buying farms—not always with the object of increasing Britain's food supplies. It has been said in their defence that they bring much-needed new capital to farming, but they pay greater prices for farms and, in so doing—and here I agree with what my hon. Friend said—they do prevent practical men from acquiring farms or would-be smallholders from getting a start. I should like to see these would-be entrants into farming put through their paces before being allowed to start farming, and if they fail in the test they should not be allowed to make a start. A New Zealander at present on the staff of Wye College in Kent declared at the British Association meetings:"But now another Yorkshireman, Sir Thomas Dugdale, presides at 55, Whitehall, and all will wish him well in his great task. For in the changed economic situation, never to be the same again as when Britain and Western Europe were the chief manufacturers for the world, full utilisation of all our food-producing resources is vital to the survival of this country with anything like its existing population."
It has got to be at full cock. We shall have to produce more food at home here long after our balance of payments prices has been overcome. We have been told by those who should know that we can provide the feedingstuffs with which greatly to expand our livestock. More farms than ever are becoming self-supporting in feedingstuffs, and I think we have got to aim at expanding self sufficiency on all our farms. Let me say a word about the county agricultural executive committees. There appears to be a difficulty in getting the right men to serve on these committees because the work involves sitting in judgment on their neighbours' farms, but this duty, however distasteful has to be discharged in the interests of the particular farmer, and it has to be discharged in the interests of the nation. I am forced to the conclusion that the sooner the committees are re-constituted the better, and the new committees must have on them more farm workers than before. It is not so much a question of gingering up the committees as of recapturing the spirit of the war years. At the same time, I think, the committees should be armed with authority, and backed by Whitehall, however revolutionary the suggested remedy may appear to be. I am forced to the conclusion that the price incentive will not alone bring the results that we all desire. Reference has been made to the part played by machinery in agricultural production today. It is playing a big part, but I think that some farmers are locking up too much money in machines. The horse is still the small farmer's best friend—and, what is more, he does not need renewals or spare parts. Our agriculture should not be allowed to decline. Every year at least 50,000 acres of farm land is lost to urban and other development. We have got to face the fact that we have only half an acre of improved land per head of the population against the three acres reckoned as necessary for a full diet. That half acre is diminishing. It is nonsense to talk about our putting all our resources into the job of producing enough food to keep our people on a varied diet all the year round. We cannot. We have not enough farm land for the purpose. The unfortunate part about it is that the small amount there is per head of the population is gradually going down, and that is taking place at a time when the complete and permanent change in our economy renders the production of home grown food the only effective insurance against starvation. The Government must meet the seriousness of the food situation—as, I think, they will seek to do—by energetic steps to produce more food from our own acres. Such things as stricter control of land use, properly planned and supervised acts of husbandry, dispossession—I say emphatically—of hopelessly incompetent cultivators, the establishment of machinery pools, intensified efforts to control pests and animal diseases, and the reclamation and equipment of marginal land, I think, are measures which should be immediately and vigorously pressed forward. Let me now refer to a subject after my own heart. I am very glad that the hon. and gallant Gentleman has brought into his Motion the subject of amenities. I welcome this reference to rural amenities. For nearly a quarter of a century now it has been my privilege to serve as the honorary President of the National Union of Agricultural Workers, and by reason of that I claim to know something of what is in the mind of Britain's farm workers. Men are still leaving the land. Unfortunately, the total number of workers at the December census was 662,200—a reduction of 9,500 compared with December, 1950. Men leave the land for better paid jobs elsewhere, but they also leave the villages because of the lack of amenities in many counties. I do not propose to talk about wages today, as this important matter will, I hope, soon be coming before the Central Agricultural Wages Board. Nor do I propose today to talk about tied cottages. It is a great temptation, but I will not give way to the temptation, because the new Housing Bill, which seeks to perpetuate the system, will, with Mr. Speaker's indulgence, provide me with an opportunity to discuss that matter. But if men are to be retained on the land and others attracted to it, we have to remove the disadvantages which attach to farm employment. Let me refer to some. Men have been killed by using poisonous sprays. No one, even if he could, would desire to stop the march of agricultural science, but men's lives are at stake—or have been, anyway; and if we are to remove the disadvantages which attach to farm employment, that is one big disadvantage that, I hope, will be removed. My right hon. Friend set up a Working Party to go into the use of toxic chemicals in agriculture, and the members of that Working Party produced what I regard as a very valuable report containing recommendations as to precautions which, I hope, will be enforceable when the Bill introduced in another place becomes law. I am very grateful to the Minister of Agriculture for offering readily to complete the work that was started by my right hon. Friend when he was the Minister. Housing goes to the root of social discontent in rural England. We want more houses, and I hope that they will all be free. Transport in rural areas has got to be extended, particularly for the farm worker's wife and family. Educational economy must not include making young country children walk miles to school along roads that have no paths. There is electricity in many cowhouses today. Why not in all the workers' cottages? There must also be a considerable increase of piped water supplies in the villages, and I think that appropriate rural industries should be developed, and rural community life encouraged by the erection of more village halls. I believe that a thriving, efficient, expanding, prosperous agriculture will yet prove to be the basis of Britain's economic security in the years to come. We must continue to foster our own agriculture, because the many engaged in it are entitled to a fair reward for the work that they do. But we must also continue to foster it because of the great contribution that an efficient and prosperous Britsh agriculture can make to the health, wealth and happiness of the British people."The more one sees of Britain's agriculture the more one realises it is only at half cock."
I am sure that the House will be very grateful to my hon. and gallant Friend the Member for the Isle of Ely (Major Legge-Bourke), who was fortunate in the ballot, for choosing agriculture as the subject for our debate today, and for framing his Motion sufficiently wide to include any aspect of the activities of the industry, and so that every point of view that could possibly be expressed about the industry could be debated in the House.On a private Members' day like this, I do not think the House would wish me to try to answer all the many and various points made during the discussion so far. I give the House an assurance that every contribution will be most carefully considered within the Department, and if any specific questions have been asked of the Government the Members concerned will receive a letter about them. I should, however, like to refer to the hon. Member for Norfolk, North (Mr. Gooch), who covered a very wide field in his helpful speech. As I think he is aware, the Agriculture (Poisonous Substances) Bill, to which he referred, is now printed, and I hope that it will shortly be debated in another place. I wish to refer also to the maiden speech delivered today by my hon. Friend the Member for Ludlow (Mr. Holland-Martin). It was a very carefully prepared speech, and I join with the hon. Member for Norfolk, North, in expressing the view that the House will look forward to hearing him take part in our discussions on many occasions in the future. I congratulate him upon his maiden speech. First I wish to deal with a few broad aspects of our agricultural policy, although I know that the House is very curious about the long-term policy of the Government. Unfortunately, the annual Price Review of the industry is now sub judice and hon. Members will realise that I cannot today refer to immediate production problems, but I very much welcome this opportunity of discussing in the House the broader aspects of our agricultural policy.
Will the right hon. and gallant Gentleman give us some idea when we can expect some news about the Price Review which is now taking place?
All I can say is—and this may not be satisfactory to the hon. Gentleman—that it will be as soon as I am in a position to announce it. He will realise that I am as anxious to make a statement on the result of the review now taking place as he is to hear it.At this stage I stress particularly the importance of a stable long-term policy, to which my hon. Friend the Member for Ludlow and others referred, which would enable each farmer on his own holding to plan the production on his farm in the way best suited to his potentialities for producing the food the nation requires. Against that he should have a reasonable assurance that the balance of price emphasis will not change violently at short notice.
I wonder whether we are quite clear about what the right hon. and gallant Gentleman has just said. He said that each farmer will be put in a position to determine his own programme and pattern of production on the potentialities of his land, but is to have a guaranteed price from the State for what he produces. Do I understand that any national decision as to what farming policy ought to be and what production ought to be is no longer to apply?
The right hon. Gentleman is quite wrong on that. Of course it will still apply; and if he will let me develop my argument he will find that there is nothing between us in this regard.One of the immediate problems we have to face is to determine how much of the national resources we can allocate to further development of agricultural capacity, and it is no indication of a lack of urgency for me to tell the House that while the re-armament programme is in progress aircraft and tanks must, to a certain extent, have a relative priority over tractors. However, I think it will be agreed in all parts of the House that today the agricultural industry is well equipped, and taken as a whole the land is in a high state of fertility. It therefore follows that without very large immediate additions to its physical resources the industry has scope for a considerable increase in food production. The responsibility of the Government is to create conditions in which this increase of production can reasonably be expected to continue, and to give general guidance to the industry on the directions in which the national requirements lie for more food from home production. This guidance can, I think, be given partly by way of price schedules—always remembering the caution I have given as to sudden changes in plans—and partly, and most importantly, by way of advice from the Government itself—through the county committees, through national agricultural advisory service, and many other ways. I shall hope to develop this theme in more detail when I am in a position to state the Government's decisions on the annual review of the economic condition of the industry. The price schedules are only one part of an agricultural programme. There are also very intricate and important questions which arise in regard to the working of Part II and Part III of the Agricultural Act, and indeed on the development of research, education and advice, animal health problems, and the problems of different classes of farms, which have been referred to today. They require careful study. I think the House generally and particularly the right hon. Member for Don Valley (Mr. T. Williams), will agree that they can best be undertaken outside the atmosphere of negotiations on prices. The Government intend to pursue these studies in full consultation with the industry as soon as possible. My hon. Friend the Member for Ashford (Mr. Deedes) in, if I may say so, a quite remarkable speech, referred to the position of world trade today, the trend of world prices, and asked whether or not the Government thought that the machinery they have at their disposal is suitable to balance the different trends of world prices. I keep constantly on my table at the Ministry of Agriculture a copy of a paper telling me exactly what is happening so far as world prices are concerned. During the past few weeks there have been a few, but only a very few, indications of a reduction in prices of world markets. It is, however, too early yet to know whether that trend is likely to continue or whether it is only temporary. So far as our machinery to operate the Agriculture Act is concerned, I would tell the House that the Agriculture Act, including the guaranteed markets and fixed prices, has in fact been operating in part to keep down the cost of the nation's food. Our arrangements operate as a flexible and very useful means of giving a fair measure of stability both to producers and to consumers. When world prices are high, as they have been in recent times, the system operates to give the different sections of the industry fair and reasonable remuneration for producing the food which the nation requires, and to give the nation the benefit of a large amount of production below ruling world prices. When the converse takes place—if it takes place—and world prices fall, the system is still there to give reasonable support to the producers and to enable the industry to keep production going with the highest efficiency and stability. That is my answer to the most interesting point raised by my hon. Friend, and I would inform the House that we are continually watching these particular trends of prices in the world at the present time. I will now say a word in regard to what is known as "the tools for the job." The mover of this Motion laid particular stress on the need for an adequate programme of capital investment in agriculture so as to facilitate the further expansion of the production of food. The House will recollect from the Chancellor's Budget speech that partly to provide more goods for export and partly to balance the demands of the re-armament programme for steel and other resources, it is necessary to reduce somewhat other forms of capital investment at home for the current year and possibly in 1953. The Government are fully alive to the need for enabling agriculture to have sufficient "tools for the job," and believe that even with some reduction in the programmes for agricultural building and land drainage, farm water supplies and machinery manufacture, it should still be possible for the industry to carry out its task. Moreover, the Government hope that it will be possible to permit some relaxation from these restrictions on capital investment as soon as conditions permit. I use that phrase because it is beyond the wit of any of us in this House or elsewhere to know when the conditions will permit such a let-up. The mover of the Motion referred particularly to agricultural machinery. I would tell him that during the year 1952 we expect farm machinery supplies to the home market—that is complete machines—to be about 70 per cent. of what they were in 1951. That is an overall cut of 30 per cent. We have asked the manufacturers to insure full supplies of spare parts which we believe to be of particular importance. There should be sufficient spare parts and new machinery to keep the existing machines going and to replace those that are really worn out; and, indeed, to allow some further increase in mechanisation, although at a rather slower rate than for the last few years. The hon. and gallant Member for the Isle of Ely particularly referred to special machinery and machinery in short supply. I am able to inform him and the House that we hope there will be rather more crawler tractors in 1952 than in 1951. We also hope—and it is only an expression of hope—that there may be in 1952 1,000 of these machines as against 850 in 1951. We aim to keep the supply of pick-up balers at the very high 1951 level of 4,000, which is more than twice the number produced in 1950. I think that the hon. and gallant Member also referred to the combined harvester. We hope that although it will be less than the record number of 1951 to keep up to the average of the last few years. There will be no restriction on supplies of complete sugar beet harvesters or complete potato harvesters. I think the House will agree that the basic need in the present situation is to get the fullest possible use out of the existing machines, and I hope that farmers throughout the country will see what they can do to use their machinery to the full, both to help themselves and, at the same time, to help their less fortunate neighbours.
Can the right hon. Gentleman say whether the industry can expect the same amount of assistance for agricultural drainage that it has received in the past?
No. I think I made it clear, as the hon. Gentleman will find if he reads my speech tomorrow, that agricultural drainage is one of the things in which there will be a cut. Actually, there will be a cut in drainage and other kindred things, such as agricultural buildings, excluding houses, of approximately 15 per cent.We are anxious to get back again to a higher level of supply of equipment as soon as the national situation allows. I cannot say how far we shall be able to do this during the course of the next two years. The Government will take full account of farm needs when they come to consider the capital investment and steel requirements for 1953. With the large resources we have on our farms today and the substantial supplies available from new production, there is. I think, no reason why anybody should be put off from striving for additional output from his farm on account of some slowing up in deliveries of new equipment. So far as rural electricity is concerned, although it has not been referred to in the debate today, I know many hon. Members are worried about electrification as, indeed, are many people in the countryside. My right hon. Friend the Minister of Fuel and Power announced a few weeks ago that although, in the present circumstances, capital expenditure has inevitably to be restricted, the Government had made it possible for the area electricity boards to proceed with the rural electrification schemes already in progress and, indeed, to start some of the urgently required new schemes. It had been decided in the autumn of last year that the electricity area boards should spend only £3 million this year instead of the £5 million they had intended to spend on rural electrification, this saving mainly to be obtained by the complete stoppage of new rural electrification schemes. The Government have decided that they should spend £4 million, which should make it possible not only for the existing schemes to continue but for some new schemes to be started. I hope that will be helpful in different parts of the country. The Government are very much alive to the importance of rural electricity at present. My hon. Friend the Member for Ludlow, the hon. Member for Norfolk, North, and other hon. Members have referred to the labour position, and I should like to deal briefly with it. I am anxious about the supply of labour, although it is true that mechanisation has gone a long way to help us increase the output per man and increase what we can get with our labour force. I know the anxiety which is felt by very many farmers about the labour prospects. I am watching the situation very closely, and I intend to do my utmost, with the help of my right hon. and learned Friend the Minister of Labour, to try to meet any difficulties as they arise; but surely the long-term answer is to make agriculture sufficiently attractive to keep the men we need on the land, and we shall do all we can to help in that direction both by creating confidence and stability in the industry and by improving the amenities in the countryside when and as it is possible to do so. The subject of amenity has been referred to by more than one hon. Member today. When we are thinking of the problems of the labour supply of the industry, it is encouraging to know that last year there was an intake of 27,000 young people into agriculture and horticulture. That is a most encouraging trend, and hon. Members in all parts of the House will hope that that will be continued. In addition to the problem of permanent labour, we also have the problem of finding sufficient seasonal labour for the peak periods, particularly the harvest. Many special arrangements have been made in recent years, and most of them are being continued, including the voluntary agricultural camps, school children and service personnel arrangements. The organisation of this labour—this is the important thing—requires co-operation from all concerned—Government Departments, education authorities, county agricultural executive committees, the National Farmers' Union, and the farmers and workers themselves. The Government are particularly concerned about labour for the potato crop this autumn. I believe that the arrangements which we are making will suffice for that purpose, and I hope that the farmers will no longer hesitate to plant the potatoes that we shall need this winter and at the beginning of 1953. I now wish to refer for a moment to the call-up of agricultural workers. At the outset I wish to say that I entirely agree with the line taken by my hon. Friend the Member for Ludlow. Questions relating to the call-up of agricultural workers are, as the House will know, primarily for my right hon. and learned Friend the Minister of Labour. My right hon. and learned Friend has given very sympathetic consideration to the representations which have been made to him from various quarters, and he has decided to make three changes in the present arrangements which will, he hopes, provide some easement of the farmers' difficulties. The first is that, with a view of assisting the drive to produce pigmeat, he will be prepared to consider applications for the deferment of pigmen as he already does for cowmen and shepherds. The effect of this is that applications for deferment of the calling-up of pigmen employed on farms of any size will be considered on their merits, just as applications in respect of cowmen and shepherds are at present. The second change is that applications for deferment made by farmers employing more than two regular whole-time male workers will be considered on their merits in those cases—this is important—where the farmer happens to employ a high proportion of young men of about the same age and is about to lose as many as one-third of the total of his regular male workers on the farm as a result of the call-up. It is hoped that this will ease the position on farms where the position has been very difficult during recent times. The third change—I think the House will agree that it is the most important of all the changes—is that, in order to assist particularly with the potato and sugar beet harvests, the calling-up of agricultural workers will be suspended during the months of September and October and the first half of November, subject to suitable seasonal adjustments in Scotland. It is hoped that these three changes in the administration of the present arrangements will be of benefit and help to the agricultural community. The Government have great hope—I shall not dwell on this point for very long because I want other hon. Members to take part in the debate—of improvement in the housing of agricultural workers from the decision of the Government, embodied in the Bill recently introduced by the Minister of Housing and Local Government, to fulfil the pledge made by my right hon. and hon. Friends to make the service cottage occupied by members of the agricultural population eligible for both the subsidy for the privately provided new agricultural cottage and the improvement grant for the reconditioning of existing cottages. We hope that this, coupled with the greater availability of licences for private building of cottages, will help farmers to help themselves in providing accommodation for their workers. My hon. Friend the Member for Ashford referred to horticulture. I and the Government are very well aware of the difficulties of the horticultural producer. I shall not attempt to cover the whole field in the course of my remarks this afternoon. There are many problems, as hon. Members will be aware, of trade relations and the conditions governing international trade which must be carefully studied by and between Governments. I would not attempt to repeat the speech recently made in this House by the Minister of State, but I would repeat what he told the House on that occasion, that all these problems are under the most active and careful consideration.
Is that the new policy after six months?
The Government have not yet been in office for six months. I wish to refer particularly to horticulture. The Government are giving very careful attention to the application made by the industry for the revision of tariffs. Meanwhile, the regulation of imports by the restriction of periods for open general licences and the use of quotas is being continued. I know there are certain points of administration of these arrangements which make for particular difficulties, and if I can help in any way, or if there is any way in which we can make arrangements to make the limitation of imports effective, we will examine that matter. I cannot say more at this stage in regard to the horticultural section of the industry other than that the Government will do their best to solve the problems which we know exist, and which we know it is urgent to solve.
To illustrate the point the right hon. and gallant Gentleman is making, would he take the case of tomatoes? I now understand that the Ministry have before them the most vigorous representation designed to restrict the import of tomatoes under reasonable conditions which will make housewives have to pay more. Are we to understand that that is the kind of thing the Ministry will approve?
No, Sir. Not at all. The kind of thing we shall approve is measures to prevent horticulturists in this country, through no fault of their own, finding their markets swallowed up overnight.
I can see the problem with which the right hon. and gallant Gentleman has dealt, but there is also the position, which is very disturbing, that the consumption of fruit and vegetables per head is less than it was before the war and something needs to be done to encourage increased consumption. Are the Government paying attention to that problem?
I am afraid it is very hard for the Government to anticipate what will be the views of housewives as to what they should have for any particular meal. The point the hon. Member has made is very well known, and that is the trend at the moment, but I think he will agree that we might find that for no apparent reason the trend may change again and there may be a bigger demand than there has been in the past. I think he will also agree that there is no commodity eaten by our people subject to more changes in demand because of the climate on any particular day.Tastes change, and very often we cannot attribute the change to any known fact. We find that on a fine and warm day the public like to eat one kind of vegetable but, if it becomes cold, they want to eat another kind of vegetable. I do not think the Government can be held responsible for the tastes of our fellow citizens, although we shall certainly watch the trends of those tastes in dealing with this problem. I turn now to the Amendment on the Order Paper. Surely it is a very curious Amendment; because it is not consistent. The mover has accepted the first part of the Motion which calls
Yet, in proposing"attention to the need for encouraging even higher productivity in the British farming industry by giving all concerned in it real confidence."
he is in my view doing the one thing calculated more than anything else to destroy the farmers' confidence in the future of this industry."the appointment of a Royal Commission to investigate the present system of fixing farm prices and its effect upon production, costs and efficiency,"
Before he concluded his speech, the hon. Member for Wednesbury (Mr. S. N. Evans) went off at a tangent and, whether he intended this or not, he was really advocating a system of complete nationalisation of the land and all that goes with it, in fact real State farming on the commissar principle.
That is an interpretation which could be put upon what I said. But what I was advocating was that in these special circumstances it is necessary to do something to get the land into the hands of those who will give us pro- duction, and not into the hands of those to whom the land is only a secondary consideration. In the special circumstances of the time, I say that a Royal Commission should consider whether the course I am advocating is a wise one or not.
That again did not seem to me likely to command that degree of confidence in the industry which the hon. Member himself, in the first six lines of his Amendment, agrees is necessary.I am trying to be very mild about this because, rightly or wrongly, it has always been my opinion that we should endeavour to keep the agricultural industry out of party politics. Unless we do that we cannot get continuity. If we do not get continuity we shall not get maximum production. The hon. Member for Wednesbury suggested that it was a good thing if the agricultural industry came into the realm of party conflict. I cannot agree with that. What we want is confidence. To get that confidence we must have continuity; and to get continuity we must have a general approach, a common method and a common way of dealing with the problems of this industry.
So we must have a conspiracy of silence.
I do not accept that at all.
What else is it?
It is right that hon. Members in all parts of the House should be able to express their opinions. That is what this House is for, to debate all matters affecting our national life. But when the hon. Member suggests a Royal Commission in order to establish confidence in the agricultural industry, he is advocating, in fact, something which would have exactly the reverse effect.What would happen were this House to agree to his Amendment and a Royal Commission was set up to consider the various problems of the industry, some of which he mentioned in his speech? The immediate result would be that no farmer in the country, whether big or small, would have the slightest idea of what would happen to him in a year or two when the Commission reported. The result would be that instead of going all out to increase production and make himself more efficient, a farmer would be reluctant—and quite rightly so—to undertake new capital outlay when the whole of his future was so upset.
The argument which the Minister has so fairly and reasonably advanced would hold water better if, in fact, the industry, out of its assumed confidence now, were giving us the kind of increase in production that we need. In fact, as the Minister knows, in the last 12 months the wheat acreage has gone down 500,000 acres, with consequent aggravation to the dollar problem, without any increased sowing of barley, or oats. Is or is not that a fact?
It is wrong.
I do not propose to argue about figures with the hon. Member now, but he is trying to bring in the weather to assist him in his argument. Apart from the considerations of confidence, which I have tried to represent to the House, it is curious that the hon. Member should produce these arguments today when only such a short time ago he was supporting his right hon. Friend the Member for Don Valley in passing the Agriculture Act, 1947. If the House is asked to record its vote in the Division Lobbies, I hope that they will negative this Amendment by a large majority.As to the Motion, although I cannot say that I subscribe to the actual terms and the many superlatives that are used, there is a great deal in it with which I am fully in agreement. I am glad that my hon. and gallant Friend the Member for Isle of Ely referred in his speech to efficiency. Efficiency in agricultural production is essential if the industry is to give its best services to the community. I am not quite clear about the request to Her Majesty's Government:
We shall, in due course, present to this House our plans for a long-term policy. Hon. Members will then have an opportunity of considering it and commenting upon it. Finally, I hope that they will endorse it. Subject to those qualifications, I recommend the House to approve the Motion."… to present for the ratification of this House its proposals, covering not less than the next four years, for British agriculture and horticulture. …"
Before the right hon. Gentleman sits down, might I ask him to say something further about drainage? What he has said may cause considerable dismay, especially in Scotland. Do I understand that he is expecting a cut of 15 per cent. in the amount of drainage done, or is there to be a cut in the grant? Is this to be a flat-rate all over the country, because in parts of the Highlands of Scotland this will cause great difficulty?
No. There is to be no cut at all in the drainage grant, but a 15 per cent. possible cut in the amount of material available for drainage work, particularly steel.
There are many comments which I should like to make but, in view of the small number of speeches we have had, some of rather great length, I shall do my best to be brief. We all sympathise with the Minister in his main difficulty, which is that he is unable to tell the House the Government's policy, because the Government are unable to make up their mind about what price they should pay. It is worthy of note that since the war we have never had a Government which has taken anything like so long to make up their mind either about what is the proper pattern for agriculture or what prices ought to be paid.We sympathise with the Minister, but I hope that, for the good of everybody and for the sake of confidence in the industry—there is a good deal of head-wagging going on in the industry just now—the Government will get round to the job of making up their mind quickly. If necessary, they should make up their mind unaided. Otherwise, a good deal of damage will be done. Some of the comments the Minister made seemed to me to be shattering. He seemed to think that his answer to the hon. Member for Orkney and Shetland (Mr. Grimond) put right a misapprehension. I should have thought that the answer increased the hon. Member's worry. The announcement that drainage, of all the work needed to contribute to greater production, is to suffer a 15 per cent. cut, not in the rate of grant but in the supply of steel and other materials and machines necessary for it, must seem to the hon. Member for Orkney and Shetland to be shattering—
New machinery, and steel generally, for all purposes connected with drainage. That seems to be a shattering suggestion. It is all very well for the hon. Member for Newbury (Mr. Hurd) to shake his head. I remember the lectures we had from the Opposition in the last Parliament about priorities for agriculture. I remember what hon. Members opposite used to say about the then Lord President of the Council not living up to his promises. "Give us the tools and we will do the job," was the story.Now agriculture, of all the industries, is to have priority no more. The undertaking of the former Lord President given in the Central Hall, I think in 1948, has been completely thrown overboard, and now agriculture goes hack in the queue with the less important of our industries. I think it is remarkable, and also very frightening from the point of view of production. I will not go into all the things the right hon. and gallant Gentleman said; we can have a look at them. I do not believe that there is a lot in what he said about relief from the call-up, but there is one thing that I want to say to him and to hon. Gentlemen opposite and with the greatest sympathy. We have heard much about the necessity for keeping men on the land, about its importance and the importance of amenities. A great deal of credit has been taken by the Minister for the new decision of the Government about grants for tied cottages, and so on. I think it is generally known that I do not take the same point of view on that question as some of my hon. Friends on this side. We differed in Committee on the Agriculture Act about that, and I have always held to my own point of view; but I warn the Government that, by deliberately choosing to raise this issue in this widest of all forms, they are inviting a devil of a row all over the countryside. They are seeking—I do not know whether deliberately or not, but this will certainly be the result—by playing up the argument about public money for tied cottages and stories about workers being evicted at short notice, much of it, I believe, overstated, to raise again the whole question of its propriety. It is absurd for the Government deliberately to choose to throw that into the ring at this time. I may be too late to ask them to think again, but I hope that the Minister will not take credit for it this afternoon, because I think it to be a mistaken and silly decision in every way. My hon. Friend the Member for Wednesbury (Mr. S. N. Evans) and I have disputed in the House before. I followed him the last time he spoke, and I did my best to answer the figures he gave. We have disputed elsewhere between then and now, and I do not propose to dispute the matter over the whole field again today. I have done my best to show him that the figures which he repeatedly uses are either wrong or misapplied by him in every case. If my hon. Friend is determined to go on doing that, it seems to me that there is little that any of us can do about it, and that, on the whole, it would be a waste of our precious time to try. I can only appeal to him, and to those who put their names to the Amendment with him, that at least they should presume that some of their comrades who have been as long in the movement as they have may not be quite the complete fools or the wicked men which my hon. Friend no doubt feels we are, and that, when we feel so strongly that they are wrong, it would not be a bad idea if they sat down and looked at the figures carefully to check the interpretation which they put upon them. I believe this Amendment to be a bad one, for the reasons given by the Minister—that it would destroy confidence and be interpreted not merely as an attempt to throw the whole policy into the melting pot, but also as a means of restricting production at a time when we want it to increase. I do not propose to go over all the arguments advanced in recent weeks. My hon. Friend still repeats them, they are still wrong, and one does not make anything right by repeating it. For instance, my hon. Friend keeps arguing about rich men buying farms. It is not true that every wealthy industrialist who goes into farming becomes a bad farmer, but we should not let us get ourselves into thinking that all our farm workers want to be farmers on their own account, or that they would be well advised to do so. In fact, I hold the view, having interests in other industries besides farming, that what we need most in this industry is the opportunity which is available in other industries to men to become charge-hands and foremen. If their coming in provides more salaried, managerial positions, it would be a very good thing, and fulfil a very great need indeed. I suggest that my hon. Friend's interpretation of the situation is wrong. May I say one or two other things? I understand why the Minister could not tell us very much about his Price Review policy, but there are some things which I should like him to consider when he is making up his mind. There has been a lot of talk on the other side of the House about the need for a long-term programme and the lack of confidence. I do not believe that there has been any lack of confidence in the industry. I believe there has been a good deal of talking down for various reasons—I was about to say very largely for political reasons, but I do not want to introduce unnecessary dispute. The policy is there in the Act and, after all, the greatest thing the present Government can claim is that they do not propose to disturb it. The expansion programme established in 1947 has not yet reached its peak, and outside the expansion programme everybody knows that virtually the sky is the limit for nearly all that we can produce. There is, of course, the implication that the farmer wants to be allowed to choose for himself the things he will grow and the pattern of production. That is why I deliberately interrupted the right hon. and gallant Gentleman during a passage in his speech which I thought, if read by itself, could be interpreted as meaning that that was so. No Government can operate a farming support policy of the kind we have operated, and which the present Government propose to operate, without telling the farmer—and let us all be honest about this—that the corollary of that is that they must accept some degree of obligation to farm in the national requirement and not as they would choose. We must not hedge about that: and all the talk about lack of confidence really relates to that.
We do not dispute that, but does not the right hon. Gentleman agree that the trouble was the violent switches in price moves?
I do not accept the argument about violent switches, either. There was an attempt to use the price incentive last year to bring about a switch from milk to meat; but the people who argued in 1946, when the Bill was going through the House, that we must rely only upon the price incentive were the National Farmers' Union and hon. Members opposite. We were told again and again that we must give up the idea of using every kind of directive machinery and that price incentive was the thing. The right hon. and gallant Gentleman and his hon. Friends will discover that if they have a price incentive policy that necessarily means that sometimes there must be a price disincentive; otherwise, we shall have to pour everything in and the Government will not be able to do that any more than we were able to do it.So long as the Government make the overall profitability of the industry right and get the general balance of profitability right I have always held—and I repeated it at least a dozen times when I held office—that farmers cannot expect everything they produce to be equally profitable. They must be willing to produce things that are needed and balance up within the general field of profitability. One of the things to which the right hon. and gallant Gentleman must give attention is the question of a balance of profitability in the industry. I will not quote now some of the figures I have here from a Ministry document and from an examination of the position by Reading University. It is possible to argue that for one reason or another we have allowed the profitability of arable farming in a large part of the country to become very much more attractive than that of livestock. We cannot generalise on farming. It may be true of East Anglia and not true of East Lancashire, but, taking the country generally, I believe it is true. If we are to maintain livestock farming and obtain adequate supplies of meat and the livestock products we want and get arable farmers, particularly in parts of the country where there are larger farms, to keep livestock, and produce milk as well as grow crops, we must even up a little on the balance of profitability as between the two systems of farming. I suggest to the right hon. Gentleman that something of that sort must be done. For a long time we have had a grassland development campaign which began in the days when my right hon. Friend was Minister of Agriculture. That campaign was intended to be carried out with great vigour. Everybody says that grass is largely the key to our problem of getting more meat and stepping up our output. We really must match our actions to our words. We must continue to emphasise the importance of grass and of improving techniques, but we must match our talk with concrete action. The other day the right hon. Gentleman replied to a Question of mine about grant-aiding co-operative grass driers. The grant-aid which we on this side of the House provided under the Agriculture (Miscellaneous Provisions) Act has been allowed to lapse and is not to be extended. I believe that to be a mistake. Every form of assistance that we can give now in the greater use of grass as a feedingstuff should be given. It would be a good economy, and a wise measure. The Government are talking but are not matching their words to actions. We have so much of this. We talk such a lot about grass drying, silage and other measures of grass conservation, yet we subsidise the use of imported feedingstuffs and, on the whole, we do not subsidise the use of home-grown dried grass. Our actions belie our words. We are giving a lead in the wrong direction, and I hope that the right hon. and gallant Gentleman will consider this matter again. On the question of subsidies, price, and so on, I take the view that the general argument of my hon. Friends who support the Amendment—the argument about costs of production, subsidies, and so forth—are almost irrelevant in the present circumstances. The question of what food we can get for the consumers of this country, including the housewives of Wednesbury, is the over-riding problem. What they are charged for the food is another side of Government policy. I believe that one of the mistakes which this Government has made in agricultural policy is to remove a sub- stantial part of the food subsidies. As the "Dairy Farmer" says in its last issue, the farmers are largely leading themselves up the garden in applauding the removal of food subsidies. It is only possible to conduct a policy of farm support of this kind provided steps are also taken to remove the pressure on the consumer at the other end. If the whole weight of additional prices imposed because of increased costs or because of the need to provide any incentive, or for other reasons, is thrown on to the consumer, we not only land ourselves in an unreal political argument, a taste of which we have had this afternoon, but we also find ourselves faced with a great deal of consumer resistance. The small milkman would be harder hit by a reduction in the milk subsidy to the consumer than by any other single action that the Government could take. I warn the Government to watch their policy in that respect. It is, in fact, destroying their intentions. I now wish to mention the subject of marketing boards. The hon. Member for Ashford (Mr. Deedes) said that we did not agree with them. From 1930 onwards all the credit for marketing boards belongs to the Labour Party. [HON. MEMBERS: "Oh."] Yes, indeed. However much hon. Members opposite may agree with marketing boards, it fell to us on this side of the House to take all the action. Some amending Acts were introduced by hon. Members opposite, but all the main Acts were introduced by us. We believe in marketing boards. I personally believe that the Government could do a lot to solve its own problems and those of any successor by getting the marketing boards into a position so that they can do many of the things which Government Departments have to do at the moment. I believe that there is a considerable argument in favour of giving back the Milk Marketing Board its powers so that it can go ahead with livestock production. I agree with what somebody said in the debate, that something might be done by that Board or another board operating a scheme of calf salvage and feeding in the areas of the country where they can be fed. With regard to capital investment and the Bank rate, it is tragic that at this time—when we want farmers to get into the habit in which industrialists have been for so long, of not being afraid to operate on borrowed money; there is an attitude in the farming industry which is not matched in any other, and which we want to get them out of—the Bank rate has been put up to 4 per cent. That is the most absurd thing that could be done in relation to food production and it will have a long and lasting effect in the rural areas. It will do more to lengthen the period taken to increase food production than any other step the Government can take in connection with the Price Review. It will have the very opposite effect from that which is intended. I regret very much that the Minister is not in the Cabinet. I should like him to make quite sure that his colleagues understand that agriculture is not in a room apart. It is part of the economy and is as much affected by social and economic policies as any other part of our economy. I think the Government are trying to deal with agriculture in one compartment, trying, without a lot of success, to bring about an amicable at mosphere; but they are doing simultaneously other things which are having the opposite effect. I hope that my hon. Friends, having had a run, will feel able to withdraw the Amendment. I can assure them that that is not because I do not want to make amendments, but because it would have such a bad effect on the industry. I think we can accept the Motion, but I see very little Government action over the last five months which would lead to the sort of things for which it asks.
I hope that the right hon. Member for Belper (Mr. G. Brown) will forgive me if I do not follow him in the very interesting sidelights of agriculture upon which he touched, on many of which I agree with him. I wish to refer to one remark made by the hon. Member for Wednesbury (Mr. S. N. Evans), where he seemed to assume that there was necessarily going to be a conflict between the urban dweller and the countryman.I hope that the hon. Member will give me his attention, because I am addressing myself to a remark he made and I should hate him not to hear what I said in case I am wrong. I do not accept the contention, which I think was implicit in his remarks, that there must be a conflict between town and country. I admit he used the word "potential" but it seems to me that he took it for granted that there must be that conflict. Not only do I not agree that that is true so far as agricultural produce and the town dweller is concerned; neither do I agree that it is so in the reverse way—from the aspect of the countryman's point of view about the products of industry. In the bigger and smaller towns they are both integral parts of our life. Town and country do a lot of good for each other and if they will only properly understand what they each require for life, welfare, happiness and production, I see no possible reason for any conflict between them. I want to put one or two things to my right hon. Friend the Minister. I was very pleased to hear him say that he was going to increase expenditure on rural electrification from £3 million to £4 million; but I should like to think, that the results on the ground will be satisfactory. In my experience, what has been happening is that the main supply is run to new council houses—it may be six or 10 or 12—but when the village itself asks to be connected to that supply, the British Electricity Authority say "No, we are limited in our capital expenditure; we cannot do anything for you at the moment." One can well understand the feeling of resentment of agricultural and other workers who have lived in the village for years, and generations, and who suddenly find that the newcomers in these houses have the modern amenities which they themselves are denied. The hon. Member for Norfolk, North (Mr. Gooch) mentioned several points with which I should like to deal, but there are two in particular. The first is the question of what I regard as the filching of land from agriculture. I dislike the use of agricultural land for other purposes, but I do not want to stand in the way of housing needs. To appreciate what is happening, it is necessary, first of all, to have some idea of how much land is to be taken from agriculture in the next few years. Answering a Question about six weeks ago, my right hon. Friend gave an esti- mate of 13,000 acres a year. I think he was correct, on the record of the last six years, but before he arrived at that figure he took into account a large amount of requisitioned land—requisitioned for military purposes—which had been handed back to agriculture, and based his 13,000 acres on the difference. I should have thought that, at any rate over the next few years, the figure was more likely to be 50,000 acres a year, which is perhaps better understood if it is translated into 500 farms, each of 100 acres. I cannot believe that all that is essential. May I draw the attention of my right hon. Friend the Minister of Housing and Local Government to these questions? Is there not some scrub land which could be taken? Cannot some of the towns build upwards? Has that been properly considered? I do not think it has. I do not like the present set-up of the Ministry of Housing and Local Government. My right hon. Friend the Minister is, as we know, making a success of his job, but it is all too easy for him to call a conference between the Minister of Housing and the Minister of Local Government. The Minister of Housing can ask the Minister of Local Government whether he wants any more powers; and I have no doubt they will reach a very satisfactory arrangement at the end of it. But where is my right hon. Friend the Minister of Agriculture? Where does he come in? He should be in right at the beginning. If he is not, we shall have a repetition of an incident which happened about a year ago, when it was proposed to take the land of two farmers for a grenade range. Neither of the farmers was notified of the intention to take the land. When I asked the right hon. Member for Bishop Auckland (Mr. Dalton) why they had not been told, I was informed that it was not the custom to tell the farmers until it had been decided whether the land was suitable or not—in other words, until the Department had made up their minds whether they would take the land or not. I do not say that we should put agriculture before housing, but I do suggest that in all these matters the Minister of Agriculture should take part in the argu- ment from the very beginning. If he does, there will be fewer cases of good agricultural land being taken where alternative land is available. There is one case in my own area, where there is heath-land which, I believe, was not taken because it was supposed to be difficult to make a garden there. I am sorry about that, but I should have thought that it was preferable to taking good agricultural land. Like my hon. Friend the Member for Ludlow (Mr. Holland-Martin), I do not believe that the agricultural community wants to be exempted altogether from National Service, but there has been—until quite recently, anyway—rather too rigid a line beyond which consideration has not been given to whether deferment should be granted or not. I think that that has applied particularly to the men dealing with livestock. Those men do not work only five or five and a half days a week: they work seven days a week, because livestock have to be fed; and, often enough, those men have to be up all night with sick cows, or for calfing or lambing. Their numbers cannot be reduced, as can the numbers of tractor drivers, etc. I do not want the livestock men to be wholly exempt, but I hope that the Minister of Agriculture and the Minister of Labour will between them give great consideration to their deferment in cases where their calling up would result in the reduction of livestock on a farm. We really ought to come to decisions on these matters now. I am very glad that my hon. and gallant Friend the Member for the Isle of Ely (Major Legge-Bourke) has moved his Motion. I hope that the Amendment will be withdrawn, and that we shall see efficiency and prosperity for the farming industry and for all those engaged in it.
This is rather like a maiden effort—a maiden speech on agriculture. I have listened to practically all the agricultural debates in this House ever since 1945, and so it is with some fear that I approach the making of a speech on this subject today. However, I am very glad that there is common agreement that it is good to have a debate on this issue.While I cannot accept the view of my hon. Friend the Member for Wednesbury (Mr. S. N. Evans), I think it is as well that we should debate this issue on the Floor of this House. I think my hon. Friend interprets his facts wrongly, and I detect behind the Amendment a streak of old-fashioned Liberalism, which I completely reject. The hon. Member for Ashford (Mr. Deedes) talked about the Minister of Agriculture's voice being a lone one in the previous Administration. At least under the Labour Government the then Minister of Agriculture was in the Cabinet. Under the present Administration the Minister of Agriculture is not in the Cabinet. There is a strange individual who is responsible for co-ordinating the activities of the Ministries of Agriculture and Food. The strange individual, I think, should be in this House. [HON. MEMBERS: "Rather not."] Here we could question that Minister.
Will my hon. Friend allow me? I hope he will not be so discourteous and irreverent. Does he realise that the "strange individual" to whom he referred to is the gentleman whom the "Evening Standard" today blames for the L.C.C. election results?
I was only saying that the Minister ultimately responsible for agricultural and food policies should be in this House, where Members of this House could ask him questions and criticise. One of the first decisions of this Government was to diminish the status of the Minister of Agriculture.The Amendment does imply a criticism of the Agriculture Act, 1947—although I am glad that, as a result of an interruption, my hon. Friend said that he still does defend the system of assured markets and guaranteed prices. I believe that the 1947 Act represented a great advance. It has initiated in the countryside virtually a revolution in agricultural practice. We should not denigrate that Act; we should not play it down. Four years is not long enough to judge the working of an Act dealing with an industry which obviously needs long-term planning and long-term security, I hope that the defenders of the idea of a Royal Commission will not criticise that Act, which is a charter for our great industry. My complaint about hon. Members opposite is that on this subject they speak with two voices. I can remember the long debates on the Agriculture Act, particularly on Part I, dealing with assured markets and guaranteed prices, when hon. Gentlemen opposite used to argue that the producer should come first. I notice that in a recent pamphlet called "Employment," written by John B. Wood, and produced by the Conservative Political Centre, that view is not accepted. On page 11 it is argued:
The pamphlet goes on to argue:"Any move towards self-sufficiency, however, can be achieved only by reducing the standard of living."
I should like to know what is the position of hon. Gentlemen opposite. Do they believe that the producer of food should come first, or do they accept this doctrine, now enunciated in a Tory Party pamphlet? The essence of this debate should be to judge not the Amendment but rather the Motion in the context of the present Government's economic and financial policy. That is why I believe the Motion to be rather pious. Since 1947 this country has embarked upon a campaign to produce a net increase of £100 million worth of food from our British farms. Of this, £50 million was to come through additional resources and £50 million from increased efficiency. I think that the last Government achieved considerable success in implementing that programme. Indeed, our total volume of increased agricultural production from 1945 to 1950 was the best in Europe. That is why I believe it is wrong for my hon. Friends to cast doubts on the success of the 1947 Act, because it was through that Act, through the security and additional resources it gave to the industry by the injection of new capital, and a system of financial aid which no other Government had given, that we were able to embark upon ambitious production programmes. The total production embraced specific targets for individual crops. Our effort through planning in the period of postwar reconstruction was certainly successful. I agree that we must look at the present situation, where production is static. It is only right and proper that the Department of Agriculture and others connected with agriculture should examine ways and means of improving productivity. There are various ways. I see that Professor Moore, reported in the "Farmers' Weekly" of 28th March, 1952, suggested that we could increase production by 30 per cent. through a better crop policy. He argues that by the use of wise cultivations and the application of more and better fertilisers that target could be reached. Other interesting proposals have been put forward by people like Mr. Blagburn, in his pamphlet published by the University of Reading. It is argued that through increased yields we can achieve an increased production of 30 per cent. If we are to have that increased production, however, we must relate it to the Government's present financial and economic policy. I suggest to the Minister of Agriculture that the present policy pursued by the Government in the field of economic planning is a policy of retrenchment which will have its effect on agricultural production. Already today the Minister of Agriculture has mentioned a 30 per cent. cut in machinery. That was foreshadowed by the Chancellor of the Exchequer in January of this year. In other words, farmers will not have those supplies which were planned for by the previous Administration. More than that, the Bank rate increase and its effect on the Agricultural Mortgage Corporation will have a serious effect in relation to small farmers who need assistance and who must go to the Agricultural Mortgage Corporation for assistance. The present policy in relation to the Bank rate will be a deterrent and it will restrict enterprise in the farming industry. I also argue that if we are to have a production increase we must have the selected aid which has been mentioned to develop our marginal land. Speaker after speaker of the Conservative Party used to argue for a dramatic policy in relation to our marginal land. What is now happening. Drainage, capital equipment, machinery, labour—"Restrictions designed to exclude goods which can be made more cheaply abroad are a direct attack on the standard of living."
I must ask the hon. Member to remember that we are in the middle of a big re-armament pro- gramme, and we cannot provide the steel necessary to re-arm if at the same time we give a full allocation to agriculture.
The Parliamentary Secretary should remember that we had a big re-armament programme last year and the year before. When his hon. Friends were advocating schemes for marginal land, they knew that we had a large defence programme. When his hon. Friend, my neighbour, the Member for Penrith and The Border (Mr. Scott) wrote "Winning new acres," they knew that we had a re-armament programme.
If the hon. Member wishes to pursue the argument of the step-up of the re-armament programme, I would point out that it only took place at the end of last year.
Let us have this debate kept to agriculture.
The Parliamentary Secretary is entirely wrong. His Government had scaled down the re-armament programme. I merely say that in view of what he and his hon. Friends suggested about growing two blades of grass instead of one, we need a large supply of capital equipment.I am beginning to suspect that all the promises to the farmers about increasing production when hon. Members opposite were in office were just like many of the other promises which have been cast aside. There is a policy of retrenchment. The policy operating in the wider field of education which will have its effect particularly in the sphere of agricultural education, because the supply of students to our agricultural colleges depends to a large extent upon the grants given by various local authorities. Thus the policy of retrenchment we see in other fields is being repeated particularly in the field of agricultural education. I make a plea to the Government not to pursue a policy of retrenchment in the field of agricultural research. There are various research laboratories throughout the country, at Weybridge, at Rothamsted, and at Harpenden. I trust they will not be affected by any economy measures of the present Administration. I say to hon. Members opposite that it is all very well coming along now with an expressed desire to increase production and in the past pleading for additional resources to the industry; yet, when they have political power such a policy is reversed. There is no rivalry between town and country. It is wrong to think of that old rivalry between producer and consumer. The interests of the producer and the consumer are complementary. Under a properly organised Socialist community no such rivalry exists, and it is very wrong for hon. Members to try to create a distinction and antagonism between the two sections. When there is depression in industry there is also depression in agriculture. When the workers in my constituency suffered from depression and unemployment, depression also hit the farmers and farm workers. It was a crisis for the producer and for the consumer. It is wrong to suggest that there is that antagonism, and I hope that my hon. Friend the Member for Wednesbury will not press his Amendment, although I believe the Motion moved by the hon. and gallant Gentleman the Member for the Isle of Ely to be a pious one in the context of the present Government's policy.
The Parliamentary Secretary should know that it is bad manners to join in a conversation when one does not know what the conversation is about. When he interrupted my hon. Friend the Member for Workington (Mr. Peart) he fell into that error. I have also a word of rebuke to offer another hon. Member opposite. It is painful for us to hear it suggested that a superannuated shopwalker, who shall be nameless, should now proceed to do in this place what he did on the hustings during the General Election. In common with the rest of us, Mr. Speaker would take a dim view of that.
Who is the shopwalker? Is my hon. Friend referring to a noble Lord?
I will merely say that he is associated with departmental stores in Manchester, Liverpool and London.The two things before us are a pious Motion asking the Government, when they think fit, to announce a long-term policy and an Amendment which asks for a Royal Commission as a matter of urgency. Of the two I prefer the Amendment. Yesterday, a delegation representing every section of the textile industry, an industry which has mass unemployment, is feeling the cold winds of depression, and affects many parts of the country, came to the Chancellor of the Exchequer, in London, with a modest plea to be relieved of Purchase Tax even as a temporary measure. The textile industry is begging and pleading for that. At the same time the National Farmers' Union are meeting the Minister of Agriculture to discuss what shall be in the new Price Review. I test what is embodied in the Amendment by this: What sort of treatment will the textile industry get, contributing to the Exchequer, compared with the treatment which the National Farmers' Union will get in drawing money out of the Exchequer? It is by that test that our Amendment should be judged. We do not object in the slightest, and never have done, to the 1947 Act. My hon. Friend the Member for Wednesbury (Mr. S. N. Evans) and I stand by that Act now as we did then, but we say that the Act and its provisions have become a habit, and that it is now broadly assumed that what the farming community wants in the way of higher prices it is tending to get. [HON. MEMBERS: "No."] Others may have different views, but I am entitled to my own. What is given to the farmers in the new Price Review compared with the treatment given to the textile industry will go a long way to prove the case embodied in the Amendment—
It being Four o'Clock, the debate stood adjourned.
Motion made, and Question proposed, "That this House do now adjourn."—[ Mr. Butcher.]
I am very glad to have the opportunity of raising today the need for National Savings in the present circumstances of the country. I think it will be agreed that it is a good practice that we should from time to time have the opportunity of discussing National Savings in this House, and if that is true in comparatively normal times, how much more is it true in the very special circumstances of today.I think it is some considerable time since this House had the opportunity of considering National Savings, and I suggest that there are at least two special reasons why it is appropriate that we should be thinking about this matter today. The first is the fact that the country is at present in a critical economic and financial position, and to the solving of our economic and financial problems the National Savings Movement is in a position to make a substantial contribution. The second is the new financial approach initiated by the Chancellor of the Exchequer in the presentation of his Budget. I am quite certain that everyone connected with the National Savings Movement and interested in the problems of thrift generally will have been encouraged by what the Chancellor said in his Budget speech. I should like to quote a sentence or two from what the Chancellor said on that occasion:
I cannot help feeling that both hon. Members of this House and the country generally have not appreciated as fully as they should the decline in recent years in the volume of net National Savings, and also the great danger to the financial position of the country resulting from that decline. I would give to the House a few facts and figures relating to the past 12 years. During the six years to 31st March, 1945, which cover roughly, the war period, the aggregate net savings made through the National Savings Movement, that is to say the surplus of new savings over withdrawals during that period, amounted to £3,071 million; which gives an average for the period of the six years of £514 million a year. When, however, we come to the six-year period following the close of the war, and ending on 31st March, 1951, the aggregate net savings for that period were £851 million, giving an average of only £142 million a year. What is perhaps even more serious than those figures themselves is the fact that there was a steady decline each year during that second six-year period. If we take the first year of that period, that is to say the year ending 31st March, 1946, there was a surplus of National Savings of £473 million. Then there was a progressive decline in each of the five following years, and in the last two years there was actually a deficit; withdrawals being in excess of the new savings. In the last year of the period, that is to say the year ending 31st March, 1951, there was actually a deficiency of £89 million. I suggest that these figures for recent years are highly unsatisfactory and that the situation they reveal calls for serious consideration. There has been a general change of attitude on the part of a great many people towards the need for savings. A feeling has become spread abroad that we must inevitably expect this decline in the savings of the public to continue; that it is inevitable in present circumstances, and that therefore the best we can do is to accept it with such degree of equanimity as we can muster. I believe this is an exceedingly dangerous attitude of mind towards the whole problem of stimulating the thrift of the people of this country. I know it is said that people will save under the stimulus and the excitement of a war effort, when they have before them the goal of the winning of the war, and when any price seems not to be high to pay for such an achievement. There is a point of view often expressed that, with taxation at its present very high levels, and also the very high cost of living, it is almost impossible for people to save today on any worthwhile scale. I believe that such a complacent attitude is not only dangerous, but based upon a lack of a proper appreciation of the facts. I support that view by reference to the expenditure which is taking place on what I think can properly be described as luxuries or, at any rate, non-essentials. I should like to quote a few figures for the year 1950. I do not think that the corresponding figures for 1951 are yet available, but I should imagine that they would not differ from the 1950 figures to a degree which would invalidate the argument that I am now developing. From the 1950 figures we can see what the expenditure of the country has been on various items of what many people would regard as a non-essential character, especially on the scale at which the expenditure has taken place. In 1950 expenditure on intoxicants was £727 million; on tobacco, £778 million; on gambling, £650 million and on entertainment, £175 million, making a grand total of £2,330 million. I suggest that, especially at a time like this, it is a sobering thought that the expenditure of the people of this country on intoxicants, tobacco, gambling and entertainment amounts in the aggregate, in the course of the year, to a sum considerably more than half the whole of the national Budget. I suggest that if it were possible by means of propaganda, and persuading people as to the lines along which their best interests lay, to accomplish a saving of 20 per cent. only in this expenditure, it would completely revolutionise the position as it affects National Savings. A diversion of only 20 per cent. of the expenditure on these articles which I have mentioned into National Savings would mean a net addition to National Savings of no less than £466 million a year. Of course, I am fully aware of the fact that these items to which I have referred are all very heavily taxed and that, therefore, any reduction in expenditure on them would mean a loss of revenue to the Chancellor of the Exchequer on the other side of the account. But probably the Financial Secretary to the Treasury would agree with me on the point that a diversion of a part of the expenditure on this kind of item into National Savings would bring beneficial economic consequences on the other side of the account which would considerably outweigh any loss of revenue which the Exchequer would suffer as a result of a curtailment of spending in those directions. I suggest that any reading of the present economic and financial position that leads anyone to the conclusion that everything is already being done in the field of saving that can possibly be done, and that there are no ways in which the public could reasonably be encouraged to divert some funds which they are at present spending on consumer goods of one kind or another into National Savings is a reading of the position which really does not correspond at all with the circumstances of the case. I should like to make two or three constructive suggestions to the Financial Secretary about measures by which I think that the savings of the people might be increased by some encouragement which I believe that he and his right hon. Friend could give. First, I suggest that the Chancellor of the Exchequer should make plain to the country that increased savings would mean reduced taxation, or, on the other hand, that diminution in savings, if continued must lead to increased taxes. I remember very well that during the war period it was the custom of the Chancellors of the Exchequer at that time to put some target before the country at the beginning of each financial year as to the amount which it was considered reasonable to expect the country to provide in the way of a net addition to savings during the year, and that target figure for savings was directly related to the tax proposals for the year, the Chancellor making it clear that any shortfall in savings during the year below the target figure which he had set would inevitably lead in the following year to the shortfall being made good by additional taxation. I suggest that the Chancellor of the Exchequer would be serving very well the interests I am sure he has at heart in the encouragement of savings if he were to make quite clear to the nation that there is a very definite relationship between the volume of savings, on the one hand, and the amount which has to be demanded from the public by means of taxation, on the other. Second, I should like to suggest that consideration should be given by the Chancellor to increasing the rate of interest on, at any rate, some forms of National Savings, and also the enlarge- ment of the present permitted maximum investments. When I refer to the probable desirability of increasing the rate of interest on some forms of National Savings, I have particularly in mind the rate of interest on deposits in the Post Office Savings Bank, which is, of course, 2½ per cent., having been at that rate for a great many years past. I think there is a very good case against too frequent changes in the rate of interest on Post Office Savings Bank deposits, but I suggest that interest rates have changed so tremendously in the past five or six years as to justify a serious reconsideration of the existing rates. Two and a half per cent. Consols are generally accepted as a convenient yardstick by which to judge the appropriate interest rate at any particular time, and, at the end of 1946, the market price of 2½ per cent. Consols was 98½ whereas, at the end of 1951, it had fallen to 61½ per 100. I suggest also that consideration should be given to increasing the permitted maximum investment. Anyone who, today, enters the field of National Savings can invest in the first year a sum of £4,875, assuming that they make their maximum deposit both in the Post Office Savings Bank and in Trustee Savings Banks, and, after that, for 2½ years, they can invest at the rate of £1,000 a year, bringing up the total maximum permitted investment to £9,875. I find it difficult to understand what objection there could be in present circumstances to lifting this maximum amount quite considerably, and may I draw the attention of the Financial Secretary to the Treasury to one particular field in which I think an increased investment should be permitted? That is the investment by building societies in the Post Office Savings Bank. During the war there was a special arrangement whereby building societies could invest quite large sums in the Post Office Savings Bank. Some of them still have investments of up to as much as £1⅓ million and more, but that field of investment has now virtually been closed for some years past. Consideration might be given to opening that door to investment again, which was opened during the war and closed soon after the end of the war. Whereas in 1946 or 1947 the Chancellor of the Exchequer at that time might have been unwilling to accept large sums in the Post Office Savings Bank at the interest rate of 2½ per cent. then prevailing, having regard to the rate at which he has to borrow in the very different circumstances of today that might very well be a field in which a substantial amount of money could be realised at a rate of interest below the rate which otherwise he might have to pay. The third and last suggestion I make is that a great new campaign is needed to bring the need for National Savings before the mass of the people of this country. It should not be a spasmodic campaign or confined to a period of a week or two or a month or two, but a consistent long-term campaign to persuade the public of the necessity for national savings. I should like the Chancellor of the Exchequer to inaugurate this campaign by a broadcast to the whole nation. That should be followed by meetings held in every constituency in which every hon. Member should be encouraged to play his part—this being a matter in which all sides of the House are agreed about the objectives we desire to achieve. At the same time, in that process of stimulating National Savings by a campaign of the type I am recommending, the opportunity could also be taken of educating the nation on the economic facts of the present situation. It is obvious that the more the public understand the economic facts the more they will realise how strong should be their sense of duty to save to the utmost of their ability. Finally, we are dealing here with something which is very much more than a question of £ s. d. We are dealing with an instinct which has existed in the British character for centuries—the instinct to save and to build up an estate. That instinct is still strong, and I ask the Financial Secretary to consider what can be done to strengthen and fortify it still further."I should like to stress the importance of National Savings. The fine work done by all members of the National Savings Movement is recognised by all Members of the Committee. I believe in savings. … I believe that what I am doing will give the Movement a great new opportunity …"—[OFFICIAL REPORT. 11th March, 1952; Vol. 497, c. 1290.]
I am very grateful to my hon. Friend and political neighbour the hon. Member for Wimbledon (Mr. Black) both for his choice of this subject to raise on the Adjournment and for the very helpful and constructive manner in which he has raised it. Indeed, my only complaint is that my hon. Friend has made many helpful and constructive suggestions but has left me in what is technically called by the Ministry of Food "short supply" in time to reply to them. But I will do my best.I can begin by assuring him and the House that my right hon. Friend the Chancellor of the Exchequer attaches to the efforts of the National Savings Movement at least as much importance as was attached to them by any of his predecessors. The National Savings Movement itself is a peculiar and extraordinarily valuable part of our organisation in this country, for it is an almost exclusively voluntary public service. The overwhelming majority of its members are volunteers who do the job because of their sense of public duty and for no other reason; and they constitute throughout this country 180,000 savings groups with over 7 million members, bringing in a very large sum of money during the course of the year. Something like a quarter of a million voluntary workers take an active part in the Movement. At the head of it in England and Wales—and I should like to take this opportunity of expressing the gratitude and appreciation of Her Majesty's Government—is that very remarkable and dynamic public servant, Lord Mackintosh of Halifax, who performs today, as he did under the previous Administration, inestimable services which are carried out with his own peculiar mixture of enthusiasm, zest, force and charm. Equally, there are Committees of great importance in Scotland, under the chairmanship of Sir John Erskine, and in Northern Ireland, under the chairmanship of Mr. Duff. What I have said of Her Majesty's Government's appreciation of the work of Lord Mackintosh's Committee in England and Wales applies, of course, in equally full measure to the Committees in Scotland and Northern Ireland. I should like, too, to say how much Her Majesty's Government appreciate the co-operation given by hon. Members on both sides of the House. My hon. Friend the Member for Wimbledon referred to the possibility of a new campaign. He will, I am sure, know from his own experience that "Lend Strength to Britain" weeks have been taking place in different parts of this country in recent weeks, and that the National Savings Committee has had the advantage of the support of hon. Members on both sides of the House; very valuable support of a wholly nonparty nature has been given. I myself had the privilege of opening the week in Sheffield, and I was immensely struck by the enthusiasm and the efficiency of the Savings Movement in that great and famous city. I express the hope most strongly that hon. Members will continue their co-operation in this matter. The importance of the Movement from the economic point of view is very great. As my hon. Friend said, there is a very direct relationship between the results each year of national savings and the pressure of inflation, and at present, when we are seeking to bear the double burden of restoring our balance of trade and shouldering the load of the defence programme, the need for the assistance of what the Savings Movement can do in the battle against inflation is particularly and peculiarly strong. My hon. Friend gave some figures and indicated that he thought the position—to use his own words—had become alarming. I differ from him in this. Of course, in this imperfect world there is no situation which any of us can imagine which could not, perhaps, be better. But all the same, the figures for national savings over the last few years do show that the Savings Movement is able, despite the difficulties of the time, still to make a very big contribution to our national well-being. Last year the net repayment of over £80 million was substantially offset by accrued interest of over £90 million. In January of this year the total amount invested in National Savings certificates, the Post Office Savings Bank, the Trustee Savings Bank and stock on the Post Office Register was £6,100 million compared with £1,500 million before the war and, perhaps even more significant, £5,000 million at the end of the war. Those figures illustrate that although we could wish for even greater increases, through all the difficulties of these years the Savings Movement has been able to hold its own, and the total of savings has actually risen by the very substantial figure of £1,100 million since the end of the war. My hon. Friend made a number of practical suggestions for forwarding the end which he and no doubt all hon. Members desire, of increasing savings and improving the results. It is true that the figures he gave for other expenditure illustrate that there is a field for further expansion and further development. So far as his particular suggestions were concerned, I think they are not ones which he would expect to have answered on the spur of the moment; but I can assure him that those suggestions, both by reason of their own merits and by reason of the source from which they came, will receive the most careful attention of my right hon. Friend. As for his suggestion as to rates of interest, I would only say that there is a great deal of evidence for the view that it is the security and availability of the money, rather than the precise rate of interest, which is the peculiar attraction of this particular kind of investment to a very large number of people. The rates, as a whole, have been kept at a very stable level over a good many years. With regard to the maximum limits, that is a matter we have to watch carefully from the point of view of securing that these really are new small savings and not merely a convenient switch of investments. My hon. Friend's suggestions will be most carefully borne in mind and I am sure that my right hon. Friend and the House will be grateful to him for having made them.
Question put, and agreed to.
Adjourned accordingly at Twenty-seven Minutes to Five o'Clock.