House of Commons
Tuesday, October 25, 1921
The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.
Private Business
East Lothian County Buildings Order Confirmation Bill,
Read the Third time, and passed.
Dorward's House of Refuge (Montrose) Order Confirmation Bill,
Considered; to be read the Third time To-morrow.
Oral Answers to Questions
India
Civil Service (Proportionate Pensions)
asked the Secretary of State for India when he will be prepared to make his statement in regard to proportionate pensions for members of the Civil Service who desire to retire owing to lack of confidence in the present method of ruling India; and what is delaying the publication of these terms?
I hope to make the announcement this week. The delay, which has been greater than I originally hoped, is solely due to consultation with the Government of India on the numerous points of detail which have arisen out of this very important and intricate matter.
As the right hon. Gentleman's pledge to me was given in this House, does he propose to make a statement in the House, or to publish it in the Press?
I am afraid it will be a very long communiqué, because it deals with the details of various services. As soon as I have arranged with the Government of India the exact language, the best plan will be for me to communicate with my hon. Friend, who takes an interest in this matter, and ask him to put an unstarred question which, with the answer, will then be on the records of the House.
Moplah Rebellion
asked the Secretary of State for India whether he is prepared to make a full statement of the troubles arising from the Moplah rebellion; and whether he is satisfied that steps have been taken to protect the lives and property of His Majesty's subjects in the event of risings in other parts of India?
asked the Secretary of State for India whether he can give the House any information regarding the situation in Malabar?
asked the Secretary of State for India whether he can state the number of casualties due to revolutionary violence in India during the War; and what is the present state of affairs in the Moplah area?
As the House is, I think, aware, I have already published and am publishing all the information in regard to these disturbances as I receive it by telegram from India. I think, however, that that information should be brought officially before the notice of the House, and to that end I am having prepared and hope to present within the next few days a White Paper containing the essence of the reports I have received. I fear that, owing to the inherent difficulties of the country, we must anticipate that the operations required to put an end to the disturbances may take some little time. I will, of course, keep the House informed as to their progress, and propose to supplement the White Paper from time to time as may be necessary.
With regard to the last part of question No. 2, the Governments in India have the fullest sense of their responsibility for the lives and property of those with whose protection they are charged. I would refer the hon. Baronet to the statement made by the Viceroy in the Council of State on the 3rd September, of which I will send him a copy. As regards the first part of question No. 7, I am not able to supply figures as to the number of persons whose death or injuries may have been attributable to revolutionary violence as distinct from ordinary crime during the period of the War. But information contained in the Report of the Sedition Committee, Command 9190 of 1918, will perhaps partially meet the Noble Lord's purpose. I will send him a marked copy.
In the White Paper that the right hon. Gentleman proposes to lay on the Table will he give information regarding the forcible conversion of Hindus to Mohammedanism, as to which information is rather wanting?
I cannot speak from memory. What I propose to publish as a White Paper is a collection of the telegrams I have received. As my hon. Friend knows, there has been a considerable number of forcible conversions.
Can the right hon. Gentleman state how many troops and armed police are employed in this Moplah area?
I cannot state that I am not sure whether, on reflection, the hon. Baronet will think that it would be wise to give the information. All troops that are necessary and for which the Government of Madras has asked have been sent.
Does the unfortunate rising among the Moplahs not prove the necessity of keeping a firm hand on India and of preventing agitators from this country spreading discontent among the natives? Has not the time arrived for a seizure of arms in India?
There never has been any doubt that it is the duty of the Government to deal firmly with outbreaks such as the Moplah rebellion.
Publicity Bureau
asked the Secretary of India whether the Government of India has taken any steps for giving the public throughout the Empire correct information on public questions; and whether a system of communication through the different grades of officials down to the village officers can be elaborated, in view of the need of counteracting seditious propaganda?
The Government of India, through their Central Publicity Bureau, which is supplemented by certain Provincial Bureaux, have developed a system by which information as to public questions is widely circulated in the Indian Empire, the measures taken by Government being in particular explained. Besides the communiques which are constantly appearing in the public Press, a very large number of leaflets and similar documents are issued. Copies of many of these are on record at the India Office, and I shall be glad to send the hon. Baronet a selection if he so requires. As regards their distribution, there are in Madras, for instance—I quote Madras because I have information for that Province—many thousand honorary correspondents of the Publicity Bureau who work in conjunction with the Provincial Publicity Bureau, so that the information may reach remote villages. The Government have, moreover, suggested to their officers that they should remove misapprehensions, correct misstatements, or refute disloyal and seditious propaganda.
Surplus Officers
asked the Secretary of State for India what are the terms given by the Home authorities to surplus officers to retire; and when the terms to be offered by the Indian Government to surplus officers of the Indian Army, which it is stated are likely to compare favourably with those given by the Home authorities, will be published?
The terms given to surplus British Service cavalry officers were announced in Army Order 320 of July last, and were published in the Press at the same time. The terms offered by the Admiralty to naval officers are given in Admiralty Order 1056 of 1920, and were, I think, also published in the Press. I do not think I need recapitulate either set of terms here, as they are somewhat lengthy and technical. I hope it may be possible to announce the terms to be given to surplus Indian Army officers in the course of the next month.
Can the right hon. Gentleman assure us that the Indian terms will compare favourably with those given by the Home authorities?
As the hon. Baronet knows, there are great differences between the services. I would rather have notice of the question, so that I can give a considered reply.
Native Troops (Protection)
asked the Secretary of State for India whether he is aware that the loyal Indian soldier and his family at his home are now being persecuted almost beyond endurance by anti-Government agents; that canal officials refuse him water for his crops, bunias refuse him food, and the loafers in the bazaar revile him because he is loyal to the British raj; and if he can state what steps are being taken in India to protect the soldier and punish his persecutors?
I have not received any reports of the nature referred to; but I am bringing this question to the notice of the Government of India.
Bengal Police
asked the Secretary of State for India what action is to be taken by the Government of India, in view of the fact that the Bengal Legislative Council have passed a resolution that no further appointments of British officers be made to the Bengal police?
I have not received a report of any such resolution, but in any case no action could be taken on it by the Government of India, as recruitment for the Superior Police Service is controlled by the Secretary of State in Council, who makes all appointments to it.
Questions
King's Own Scottish Borderers (Private C. Edwards)
asked the Secretary of State for War whether he is aware that Private Charles Edwards, No. 318048, D Company, King's Own Scottish Borderers, of Cowdenbeath, joined the Army on 27th November, 1920, when he was only 17 years of age; that his mother wrote to the War Office and to the colonel commanding, pointing out that he was under age, and claiming his release; and what action has been taken?
There is no trace in the War Office of any application from Mrs. Edwards, and I am not aware of the facts concerning Private Edwards' enlistment. A report has been called for, and I will let my hon. Friend know the result.
Is the right hon. Gentleman aware that this boy enlisted in November, that he was only 17 years and 3 months old at the time, that his case has been before the War Office, and that no reply has been received?
That is exactly what I am not aware of. No trace has been found of the case at the War Office. If my hon. Friend will give me particulars I will look into the case at once.
Iraq (Oil Concessions)
asked the Secretary of State for the Colonies whether the Persian Oil Company has been given a monopoly for prospecting oil in Iraq; and whether the King of Iraq has the power of giving other oil concessions to British or other companies in his kingdom?
With regard to the first part of the question the answer is in the negative. The general situation is as stated in the White Paper (Miscellaneous No. 10, 1921) concerning Economic Rights in Mandated Territories. With regard to the second part under Article 240 of the Treaty of Sèvres, property situated in Iraq and belonging to the Turkish Government or to the Turkish Civil List was to be acquired without payment by the new State of Iraq and when the Treaty has been ratified, which as my hon. and gallant Friend is aware has not yet been done, the State of Iraq would therefore succeed to all the proprietary rights of its predecessor.
Will my hon. Friend tell me to whom British companies are to apply for a concession of the kind suggested in the question?
Is the Anglo-Persian Oil Company meant by the "Persian Oil Company" mentioned in the question?
I have no doubt the Anglo-Persian Oil Company is meant. As to the other question, I have some hesitation in giving a reply off-hand, as the matter is extremely technical. I would rather my hon. and gallant Friend gave me notice of the question.
West Indies (Representative Government)
asked the Secretary of State for the Colonies whether he has received a memorial signed by about 2,000 residents of St. Lucia, including authoritative representatives of all sections of the population, petitioning for a system of representative government; and whether, seeing that a similar request has been granted in the case of Grenada, and in order to allay unrest and encourage inter-colonial good-feeling, he will now accede to this St. Lucia petition?
The petition, which is presumably the same as that referred to in the question asked by my hon. Friend on the 17th August, has been received. The signatories have been informed that it is proposed that, if, as I hope I am, able to visit St. Lucia during my forthcoming tour in the West Indies, I should take an opportunity of acquainting myself on the spot with public opinion in St. Lucia regarding the suggested change in the constitution of that island, and that the Secretary of State will therefore defer consideration of the matter pending my return.
Would the hon. Gentleman kindly answer the second part of the question, namely, whether a similar request has been granted to Grenada, and whether representations have not reached the Colonial Office showing the most unhappy circumstances if a preference is given to one Colony over another in the same group?
With regard to the first point, I was under the impression that I answered the question yesterday. It is a fact that a similar request was received from Grenada. It was received very much earlier, and effect has been given to it. With regard to the other part of the question, I have had a great many representations on the subject of St. Lucia, but I would remind the hon. Member that inasmuch as my visit to the West Indies is largely the result of this and similar representations, it does not seem unreasonable to defer decisions for three months.
Will the hon. Gentleman extend his tour to Hong Kong, where a similar application is being made on behalf of British residents in that part?
Seeing that the Administrator is in England at the present moment and that there is general agreement upon, and no opposition to the proposal, why cannot it be dealt with now, instead of postponing it until next year?
I have seen the Administrator and I do not think I have anything to add to what I have said.
What period will elapse before any action can be taken, after the hon. Gentleman's visit?
I cannot, of course, be precise as to dates, but I need scarcely point out to my hon. Friend that the most probable way of arriving at a conclusion expeditiously will be to form an opinion on the spot, and then I shall be in a position to offer advice to my right hon. Friend the Secretary of State and enable him to deal with the matter.
You did not do that in the case of Grenada.
asked the Secretary of State for the Colonies the decision te which he has come in regard to the petition of Grenada for a system of representative government; and when the new-system will come into operation?
This is the question to which I have previously referred. The petitioners have already been informed that it is proposed to amend the existing Constitution of Grenada by introducing an elective element into the Legislative Council. A local commission has investigated the details of the scheme, and their report is now under consideration. It is not possible to fix a date for the new Constitution to come into force, as some of the details may require consultation with the Governor.
Is there any reason whatever why a concession granted to Grenada should not also be granted to another Colony in the same group under the same conditions?
The main difference between the two, as I have tried to point out, is that one request was received about six months before the other.
Magadi Soda Company, Limited (Claim)
asked the Secretary of State for the Colonies whether, seeing that the Government during the late War took over the control of the railways and water supply in East Africa belonging to the Magadi Soda Company, Limited, and that this property was of great assistance to His Majesty's forces in the campaign in this area, he will arrange that the claim made by the company for the interest on the money expended on the railway and on the water supply during the period when the Government had control shall be paid by the Government?
I have been asked to reply to this question. The claim has received careful consideration, but I am advised that it is inadmissible.
Police Pensions
asked the Secretary of State for the Home Department, whether he is aware that the police authorities for Devonshire, Essex, Exeter, Lincolnshire, Salisbury, Wiltshire, Berkshire, and Worcestershire have, in increasing pensions under The Pensions (Increase) Act, 1920, taken advantage of the word may in Part I (1) of the Schedule to the Act, to grant increases less than the amount authorised by the Act; and, if so, whether the police authorities concerned have any discretion in the matter in view of the fact that the word may in most Acts of Parliament is held to be equivalent to the word shall?
I understand that the police authorities mentioned in the question have not in all cases granted increases of pension to the full extent permitted by the Act. I am advised that the matter is one in which the Act gives police authorities a discretion.
Does the Act allow a> reduction in the pensions specified, where all the stipulations have been complied with? May I further ask whether the decision of the Solicitor-General in the Committee on this matter holds good, especially as he ruled that "may" was equivalent to "shall" in most Acts of Parliament, and he justified that because it was a duty and, where a duty was thrown on local authorities, it was not subject to any caprice of that local authority?
I really must ask my friend to put that down. I cannot follow his supplementary question.
In view of the grave objection to differences in the treatment of police pensioners in different parts of the country, will the right hon. Gentleman consult the Law Officers and inquire whether the word "may" in this Section of the Act does not really mean "shall"?
I do not agree at all that there is a great deal of difference in the treatment of pensioners in different parts of the country.
In the event of the question of "may" or "shall" being decided, will the right hon. Gentleman support the decision of the Solicitor-General in Committee on this matter?
The Solicitor-General gives no decisions in Committee. It is the Committee which decides.
It is upon the opinion of the Solicitor-General that the Committee acted. They accepted his interpretation.
Scotland
Motor Ambulances, Glasgow
asked the Secretary for Scotland whether his attention has been drawn to correspondence between the Scottish Education Department and the education authority for the burgh of Glasgow regarding the method adopted by the authority for financing the cost of motor ambulances purchased by the authority for the conveyance, in terms of the Education of Defective Children (Scotland) Act, 1906, of cripple children to and from special schools maintained by the authority, whether the use of motor ambulances for this purpose in Scotland was first made by the School Board of Renfrew, who were authorised by the Department to charge the same to capital to be liquidated over a period of years; whether thereafter the Department twice sanctioned the provision by the School Board of Glasgow of motor ambulances and authorised the payment to be charged to capital; whether now the auditor of the Department insists that the cost of a further supply of motor ambulances and other motor vehicles be charged wholly to the revenue account of one year; and whether the present attitude of the Department, whereby heavy expenditure designed to benefit the citizens over a period of years is to be met altogether by rating in one year of exceptional depression, has his approval?
I have looked carefully into the correspondence referred to by my hon. and gallant Friend. It is the case that in the instances quoted the Department, having regard to the small expenditure involved, raised no objection to proposals for spreading over a period of years the cost of motor ambulances purchased by the School Boards of Renfrew and Glasgow for the purpose of conveying cripple children to and from special schools. When, however, the Glasgow Education Authority made application for sanction to spread over a period of six years a considerable expenditure in respect of motor vehicles, including not only motor ambulances for the conveyance of defective children, but also motor lorries for coal haulage and other purposes, the Department thought it necessary to refer the question to counsel. In the opinion of counsel, borrowing for purposes other than those expressly authorised in Section 45 of the Education (Scotland) Act, 1872, and in Section 24 of the Education (Scotland) Act, 1908, is ultra vires of an education authority. In these circumstances the Department had no option but to decline to sanction an arrangement for which there is, as they are advised, insufficient statutory authority.
Women's Rural Institutes
asked the Secretary for Scotland whether, in view of the interest taken in the women's rural institutes in Scotland, he can say how many members of the Board of Agriculture for Scotland are employed in connection with women's rural institutes in Scotland; what positions are occupied by these members of the staff and the salary attached to each position; how many members of the staff are engaged in propaganda work and how many in teaching; what the total expenditure per annum is on women's institutes in Scotland, salaries, travelling expenses, and other expenses; what is the relation of the staff of the Board of Agriculture engaged in the work of the rural institutes in Scotland to the central committee of the institutes; and how often has the central committee met?
The staff employed by the Board of Agriculture for Scotland in connection with women's rural institutes in Scotland numbers seven, namely: One organiser at a salary of £450 per annum, three assistant organisers—two at salaries of £200 each and one at £250 per annum, one woman clerk at 56s. a week, and two typists at 47s. 6d. and 50s. a week respectively. Propaganda work necessarily involves the giving of instruction in institute organisation and development, and all members of the organising travelling staff are trained to undertake this. The total expenditure from the Agriculture (Scotland) Fund during the year ended 31st March, 1921, was £2,008, made up as follows: Salaries, £1,201, travelling expenses, £600, and other expenses, £207. The relation of the staff of the Board engaged in the work of rural institutes in Scotland to the central committee of the institutes is purely advisory. I am informed that the first meeting of the central committee will be held this month.
Land Settlement
asked the Secretary for Scotland the number of men who have been settled upon the land under the Land Settlement (Scotland) Acts from 1st January, 1919, up to 1st October, 1921?
The number of holders settled from 1st January, 1919, up to 1st October, 1921, is 1,245, including 743 ex-service holders.
Can the right hon. Gentleman say whether the Government are satisfied with the progress they are making in this matter?
I think satisfactory progress has been made, and it has been accomplished in difficult circumstances.
Church of Scotland (Temporalities)
asked the Secretary for Scotland whether a Commission to inquire into the temporalities of the Church of Scotland has been appointed; and, if so, will he state the names of its members?
The reply to the first part of the question is in the negative.
Unemployment
Building Trades, Scotland
asked the Secretary for Scotland whether he can give the figures of the numbers unemployed in each of the building trades in Scotland?
I have been asked to reply. At 7th October, the latest date for which figures are available, the numbers of unemployed men in the building trades in Scotland were as follow:
Can the right hon. Gentleman say why the Prime Minister informed us there was no unemployment in the building trades?
If my hon. Friend looks at this a little more closely, he will observe that 1,175 of these men are painters, and that is a seasonal trade, while 3,458 are labourers, whose unemployment largely depends upon the fact that there are skilled men out of work. Of all the others, 1,700 alone are men of other skilled trades, and that means largely that they are men who finished jobs in particular localities and have not yet gone off to others, and who come to register with us.
Shipbreaking
asked the Parliamentary Secretary to the Admiralty whether he has received a communication from unemployed boilermakers in the Plymouth district relating to the local ship-breaking scheme; and whether he is in a position to state his views on the suggestions made?
The communication referred to has been received. The ship-breaking scheme provides for the employment of both ex-service men, and men discharged "on reduction" from the dockyard, this being a principal object. It is open to the contractor to employ whatever classes of workmen may be necessary for the carrying out of the work.
Is the hon. and gallant Gentleman aware that the scheme at the present moment has rather broken down, and many men are unemployed?
Yes, Sir, I regret that I am aware of it. I am doing my best to devise some scheme for helping the situation.
Tramways, Preston
asked the Minister of Health whether he is aware that at Preston the tramways committee of the local authority were obliged to discharge a number of men engaged on repairs to the permanent way, the money allocated for repairs having been exhausted; that subsequently the local authority obtained a grant for work on the permanent way; that men were engaged through the employment exchange for this work; that some of these men had been previously discharged by the tramway committee; and whether, in such circumstances, where men are skilled in the work, the condition that the rate of pay must not be above 75 per cent, of the ordinary rate applies?
I understand from the Unemployment Grants Committee that ordinarily the condition as to 75 per cent, of the ordinary rate of wages is to apply to all cases, but that, in this particular instance, the condition will not be enforced by them, because sanction to the scheme was given before the condition was announced in the recent Circular.
Health Insurance Contributions
asked the Minister of Health whether he has received any protests from approved societies with regard to the Circular issued to them allowing to treat employed contributors under the National Health Insurance Act with a certain amount of latitude in the event of the necessary number of contributions not having been paid in consequence of unemployment; whether he is aware that the Circular is regarded as inadequate and that certain approved societies are urging the re-introduction of the benevolent fund or the deduction of a percentage of each society's valuation surplus to be placed in a separate fund, so that the liability might be distributed over the whole of the societies and not limited to any particular one whose members have been hardest hit by unemployment: and whether he will give this matter further consideration?
It has been represented to me by Approved Societies of various types that the concession recently made with reference to the arrears of insured persons who were employed for less than 26 weeks in the past contribution year is not sufficient to meet the needs of the case, and the whole question is having my careful consideration, with a view to the immediate introduction of amending legislation.
Post Office
Telephone Service, Bourneville, Mon
asked the Postmaster-General if the inhabitants of Bourneville postal district, Blaina, Monmouthshire, are without the convenience of a public telephone; that repeated applications have been made to the postal authorities for the installation of a telephone; that when medical aid is urgently needed there is no public telephone within a mile of Bourneville; and will he therefore give instructions that a public telephone shall be installed in this area without further delay?
I am prepared to provide a public telephone call office at the Bourneville post office if a guarantee be forthcoming to make good the difference between the annual receipts and the sum of ÂŁ12. Details of the guarantee terms have been supplied to the District Ratepayers Association and their reply is awaited.
Is it the inhabitants or the place who give the guarantee, or who is to give the guarantee? Is it customary for private individuals to guarantee a Government institution like the telephone system?
If there is not ÂŁ12 worth of business in the village there cannot be very much serious hardship.
Postcards
asked the Postmaster-General what was the average monthly number of postcards passing through the post before the recent change in rates, and what is the number to-day; and is the loss in revenue compensated for by the saving in working costs?
I am not yet in a position to give this information. Returns have just been taken, but it will be some little time before the results can be tabulated.
Will the right hon. Gentleman be able to give a reply next week?
No. This is a very big business and it will take a considerable time to get the returns in.
asked the Post master-General whether he is aware that the prohibitive postage rate on picture postcards has led? to a diminution of upwards of 50 per cent, in the issue of these cards, causing serious losses to many retailers and unemployment to many workpeople in the trades concerned; whether he will, in the circumstances, agree to an immediate reduction in the rate of postage; and whether the same staff is required to deal with the reduced number of postcards as was employed before the increased rate became effective?
I have nothing to add to my answers to previous questions on this subject, except to say, with reference to the last part of the question, no part of the staff is engaged in dealing exclusively with postcards, and that the adjustment of the staff to the work is a matter constantly under review.
Is the right hon. "Gentleman not aware that unless something is very rapidly done with regard to these picture postcard stamps the industry will cease to exist before the postage is reduced?
I think that is a very alarming statement to make.
Is this one of the methods by which the Government wish to stimulate trade in this country?
Circulars
asked the Post master-General if he is aware that a Belgian advertising agency is circularising firms in this country, pointing out that the saving in postage rates makes the cost of printing a negligible quantity, and offering to print, fold, address, and post 1,000 copies of a circular for ÂŁ4 5s., whereas the postage alone in this country would amount to ÂŁ4 3s. 4d.; and whether, under these circumstances and in the interest of British printers, he will consider the desirability of reducing the existing postal charges upon printed matter?
I would refer my right hon. Friend to the answer I gave on Thursday last on this subject, a copy of which I am sending him.
Does the right hon. Gentleman accept the figures given in this question?
I have no reason to dispute the statement contained in the question.
Postal Train Service, Scotland
asked the Postmaster-General whether he is aware that, under the alteration of the postal train arrangements, subscribers for the Edinburgh and Glasgow morning papers resident in a great number of towns and villages in Scotland north of Glasgow and Edinburgh do not receive their copies of Monday's issue until much later in the day and, in many districts north of Stir- ling, not until the following morning, Tuesday; and whether he will take prompt steps to remedy this great inconvenience?
I am aware that the discontinuance of the postal train which formerly left Euston for Aberdeen on Sunday night has resulted in the delay of a certain number of Scottish newspapers published early on Monday morning. Such arrangements as were possible have been made to minimise the inconvenience, and I understand that the number of these papers now delivered later in the north of Scotland is probably but little over a 100. It has been necessary to subject all parts of the country to restrictions in connexion with the cessation of Sunday night mail services, and as there is still urgent need for limitation of Post Office expenditure I am not yet in a position to reconsider the matter.
When is this postal train service between Euston and Aberdeen likely to be resumed?
I must refer my right hon. Friend to the last part of my answer. At present I am not in a position to do more.
Are the inhabitants of those parts of Scotland to be precluded from reading, for example, Minister's speeches made on Saturday till late in the day on Monday?
That is possible, but you cannot make great economies without minor inconveniences.
Why not close the Post Office altogether?
Is the right hon. Gentleman aware that letters posted before 12 o'clock noon last Saturday in the towns of Ashton, Preston and Radcliffe did not arrive—
The hon. Member should give notice of such a question.
Vacant Site, St. Martin's-Le-Grand
asked the Postmaster-General if it is intended to utilise the vacant site formerly occupied by the General Post Office in St. Martin's-le-Grand for purposes connected with his Department; and, if so, when it is proposed to start building operations?
The answer to the first part of the question is in the negative. The site will be disposed of when an adequate offer is received.
Can the right hon. Gentleman say for how long the site has been vacant?
I think, for some years. Work was intended to be begun on the site before the War, but the Government decided, in the then condition of national finance, that they were not justified in going on with so ambitious a scheme. The work can be done in a less expensive part of London, and I hope a substantial sum will be realised by selling this magnificent site.
Increased Charges
asked the Post master-General if, in view of the disappointing financial result of the in creased postal charges, the general dissatisfaction caused thereby, and the fact that foreign postal systems are being utilised in order to evade our inflated prices, he will, at the earliest possible moment, take steps to revert to the pre-War standard?
I would refer the hon. Member to the answers to similar questions on Thursday last.
Having regard to the circumstances referred to in the question, will the right hon. Gentleman be able at an early date to revert to a standard somewhat intermediate between the present standard and the pre-War standard?
I hope to be able to do that—and the Government will do that—as soon as the finances of the Post Office and of the country justify it, but if we met the case of Belgium and France, the people who are capable of sending their correspondence to those countries to get the benefit of the depreciated exchanges would then transfer their correspondence to Germany, and it would be impossible for us to meet the depreciated currency in Germany.
Telegraph Facilities, Norwich
asked the Pastmaster-General why the usual custom of the Post Office to provide the public and the Press with telegraphic facilities during the night in those towns where a morning daily paper is published has recently been departed from in the case of the Norwich Post Office, which is now closed at midnight; and whether the reason officially given that the number of ordinary telegrams after midnight is very small means that the policy of the Department is now to require that the business in every branch of its operations and at all hours shall be remunerative, irrespective of the fact that the Post Office controls a service of public utility?
The policy of the Post Office in this matter is based upon the general requirements of the public telegraph service. There has been no recent change of general practice, but in view of the urgent need for economy, and of the very high cost of staffing telegraph offices throughout the night, inquiry has been made into the justification for night attendance at a number of the larger offices, and as a result it has been decided to curtail the hours at several offices, Norwich among them.
Ex-Service Men
Pensions Regional Headquarters, Dublin
asked the Minister of Pensions why Mr. C. A. Pim, a prominent business man in Dublin, is retained in the positoin of regional director in Dublin, taking into consideration that he has never served with His Majesty's forces; and what steps are being taken in Dublin Regional Headquarters to enforce the terms of the Lytton Report in connection with the substitution of Mr. Pim and other civilians by ex-service personnel?
Mr. Pim was appointed as Regional Director of the Ireland (South) Region on its inception in July, 1919, and it would be inopportune, in the exceptional circumstances at present prevailing, to consider the question of his replacement. The total temporary staff employed in the region is 296 and of these only eight, some of whom are already under notice of discharge, have not served in the forces.
Is it not a gross breach of the Lytton Report that this man is being retained?
If my hon. Friend was kept as closely in touch with ex-service men as I am, he would know that the first consideration is efficient administration.
Are we to understand that men are put in these positions irrespective of whether they are service men or not?
The hon. Member, unfortunately, appears not to have heard the last part of my answer, which was to the effect that out of 296 people whom we are employing, only eight are not ex-service, and some of those eight are under notice of discharge.
Ministry of Pensions
asked the Minister of Pensions if he is aware that certain non-service staff in his Department, recently dismissed through substitution machinery, were re-engaged in another section of his Department; and how this action is to be reconciled with the Government's statement regarding employment of ex-service men?
The answer to the first part of the question is in the negative. As my hon. Friend is no doubt aware, the Lytton Committee in their recent Report have recommended a definite proportion as between ex-service and non-service personnel in substitutable grades in the Ministry; and in order to give effect to that recommendation with the greatest rapidity and administrative convenience, women are being transferred from certain sections to fill vacancies in pension issue offices.
asked the Minister of Pensions what was the total number of non-service staff employed in Government Departments on the 1st of August?
The total number of non-service staff employed in Government Departments on the 1st August, 1921, was about 219,000, of whom 165,897 were permanent civil servants.
Stores Department, Post Office
asked the Postmaster-General whether women are being employed on men's work in the mail-bag section, Post Office Stores Department; and whether, in consequence, ex-service men have been discharged?
Owing to temporary slackness on their own work, eight needlewomen are being employed in stencilling light-weight mail bags, which work as a matter of convenience is normally allotted to men. The arrangement is not likely to last more than a few days, and no ex-service men have been discharged in consequence of it.
asked the Postmaster-General how many non-service temporary packers and porters are employed in the Department in London: whether he will see that no further dismissals of ex-service temporary packers and porters shall take place while non-service personnel is being retained; and whether redundant ex-service men can be used to replace non-service men of their class?
There are no temporary non-service packers and porters employed in the Department in London.
32 & 33.
asked the Postmaster-General (1) whether the Post Office Stores Department has a Substitution Committee set up in accordance with the Lytton Committee's Report;
(2) how many temporary clerks are employed in the Post Office Stores Department, London; what are the numbers of non-service men and women employed on clerical duty; and whether this Department is carrying out the recommendations of the Lytton Committee?
As the answer to these two questions is somewhat lengthy, I will, with the hon. Member's permission, circulate it in the OFFICIAL REPORT.
The following is the answer:
A Substitution Committee has not been set up in the Post Office Stores Department, London, as the number of non-service temporary clerical staff is not sufficiently large to justify the formation of such a Committee. One hundred and thirty temporary clerks are employed, of whom 73 are ex-service men, 15 are non-service men, and 42 are women. All the non-service men and 22 of the women are employed on permanent work which is proper to men, and are only being retained till permanent staff is assigned from the recent competitions. It would not be in the public interest to replace them by ex-service men who would shortly have to be displaced to make way for the men assigned for permanent service. The remaining 20 women are employed on women's work, and are therefore non-substitutable. The recommendations of the Lytton Committee are being applied in the various Departments of the Post Office.
Improverships
asked the Minister of Labour if, in view of the great difficulty experienced by disabled ex-service men in getting employment at the present time, he will make special provision for such men who have recently left training centres without obtaining improverships?
I can assure my hon. Friend that the question of making provision for these men is receiving my most earnest attention. Special efforts have been and are being made to find improverships for men whose institutional training has terminated, and a special canvassing staff has been appointed to assist Divisional Directors of Industrial Training in securing workshop vacancies with private employers. One thousand and fifty-six vacancies have been found in the last seven weeks.
Higher Education Grants
asked the President of the Board of Education how many, if any, officers of the Army and Navy are still being educated at Oxford and Cambridge and other universities at the expense of the taxpayers; what has been the total of such expenditure; and when it will entirely cease?
The number of ex-service officers and men who are now in receipt of grants under the scheme administered by the Board of Education, which covers Universities and other institutions for higher education, is, approximately, 11,000. The total expenditure up to 30th September, 1921, is £5,724,934, the estimated total expenditure is £8,500,000. I anticipate that the expenditure under this scheme will almost entirely cease in the financial year 1925–26.
Apart from the enormous expense, is the right hon. Gentleman sure these young men will profit by acquiring that blend of intellectual arrogance and sentimental socialism which is the hall mark of University education?
You benefited by a University education!
Question time is not the time for flowers of speech!
Government Departments
asked the Financial Secretary to the Treasury how many ex-service men have been discharged or received their notices from Government Departments since 1st June; how many ex-service men who have been previously employed in Government Departments are awaiting re-allocation through the Joint Substitution Board; and whether the 'recommendations of the first interim Report of the Lytton Committee are carried out in respect of dismissals of ex-service men, namely, disabled men last to go?
asked the Financial Secretary to the Treasury whether since 1st June a large number of ex-service men have been discharged from Government Departments; whether since the Armistice conscientious objectors have been reinstated; and, if so, whether he can give the approximate numbers in each case?
I would refer my hon. Friends to my reply to questions on these subjects on the 20th October.
Is the hon. Gentleman aware that he has not answered the second part of my question—how many ex-service men are awaiting re-allocation?
I think my hon. and gallant Friend will find that I answered a similar question yesterday. That answer will be in the OFFICIAL REPOBT today.
Nor do I think the hon. Gentleman has answered the second part of my question?
That was answered yesterday, too!
That also was answered in the longer reply to which I have referred.
Questions
Need Pensions (Poor Law Relief)
asked the Minister of Pensions if the pension of Mrs. Wiseman, Cowdenbeath, was reduced on account of the fact that she was in receipt of Poor Law relief; under what authority the reduction was made; and if he is aware that the Poor Law authorities in granting the amount of relief took her pension into account?
My right hon. Friend is reconsidering the question as to the effect of Poor Law relief on "need" pensions granted under the Royal Warrant, and I hope to communicate later with my hon. Friend with regard to the individual case to which he refers.
League of Nations (Upper Silesia)
asked the Prime Minister whether it is intended that the British Representative on the Council of the League of Nations is to make an explanation to this House of the reasons for his concurrence in the decision of the Council to partition the industrial district of Upper Silesia, especially in view of the fact that the sittings of the Council were held in secret; and whether this explanation can be made before the right hon. Gentleman's departure for the Washington Conference?
I would refer the hon. and gallant Member to the reply given yesterday by the Prime Minister to my Noble Friend the Member for Hastings (Lord E. Percy).
Yes, but can the right hon. Gentleman now state if we shall have any opportunity of discussing this very extraordinary award with regard to Upper Silesia, and thus of giving the Lord President of the Council an opportunity of making some sort of explanation to the British public?
I think my right hon. Friend said yesterday that, in the circumstances which he recounted in his answer, he would suggest that we should wait until the documents were in, the hands of the House and we had had an opportunity of studying them before debating them.
But is the right hon. Gentleman aware that the documents have now appeared in full in the Press, and that hon. Members have had an opportunity three days ago, and can he now state if there will be any opportunity of hearing the right hon. Gentleman's defence of the auction taken by the Council?
German Indemnity and Reparation
asked the Prime Minister whether he is prepared to give a day for the discussion of the Motion standing in the name of the hon. Member for Kingston-upon-Hull, Central Division, on the subject of the German indemnity.—[" That this House is of opinion that the Indemnity Payments fixed for Germany under the Treaty of Peace and subsequent agreements are injurious to the trade of the world and, in particular, adversely affect this country; and expresses its opinion that the time has come for a revision of the whole position, with the reservation that all possible assistance should be given by Germany towards the rebuilding and re construction of the devastated areas in France ."]
No, Sir. I see no prospect of time being given for the discussion of this Motion.
Is the right hon. Gentleman aware that on 15th January another payment of 1,000,000 gold marks is due from Germany, which no financial expert in Europe considers can be made without the creation of financial danger, and are we not to be able to discuss this matter?
The hon. and gallant Member now appears to be debating the subject.
Greece
Queen Olga
asked the Prime Minister whether Queen Olga, con sort of King Constantine of Greece, is at present in England; whether this presages any recognition by Great Britain of Constantine as King of Greece; and whether any conversations have taken or will take place between any British Ministers and Queen Olga with reference to either dynastic questions or the present war between Greece and Turkey?
I have no information as to the first part of my hon. and gallant Friend's question. The second and third parts, therefore, do not arise. I would venture to point out to my hon. and gallant Friend that Queen Olga is the mother, and not the wife of King Constantine.
Is the Government not aware that Queen Olga is now in this country, as mentioned in the French Press?
I am not aware of it.
Loan
asked the Under-Secretary of State for Foreign Affairs whether any negotiations have taken place or are now proceeding with a view to the granting of a monopoly for the exploitation of tobacco in Greece to a group of English capitalists in return for a loan?
I understand that negotiations were proceeding recently in regard to a loan to Greece from private sources in the United Kingdom, but at present I have no further information.
Ireland
Destruction of Houses
asked the Prime Minister whether he is aware that during the past two years many loyalists of small means in the South of Ireland have had their houses destroyed and are now suffering great inconvenience and hardship; and what measures does he propose to take to meet their case?
The Government fully realise the hardships inflicted upon many loyal subjects of His Majesty in the South of Ireland during the troubled period of the past two years. For loss sustained by the destruction of property, however, a remedy is available in the provisions of the Criminal Injuries Acts, which enable compensation to be claimed from the ratepayers of the county in which the property was destroyed. The Government will consider whether further measures are required.
Has the right hon. Gentleman seen the Regulation recently issued by the Sinn Fein Minister of Defence prescribing a dose of lead to anyone who makes an application for compensation? May I send it to him?
Yes.
Will the right hon. Gentleman read it?
Certainly.
Have any of these-people been paid, and, if so, how many have been paid out of the money awarded?
Notice must be given of that question.
Exchequer Grants
asked the Chancellor of the Exchequer whether he can give an estimate of the total amount of the money which is normally due to the local authorities in the three southern provinces of Ireland from the Imperial Exchequer by way of grant or otherwise, but which is being withheld owing to the refusal of the local authorities to meet the awards made in respect of malicious injuries inflicted on the loyalist population by the Republican party?
The total amount payable from the Local Taxation (Ireland) Account to local authorities in Southern Ireland and withheld under the Restoration of Order in Ireland Regulations, stands at present at approximately £1,650,000. Of this, £940,000 has already been applied in the discharge of criminal injury decrees awarded to Crown employés and other liabilities of these authorities, namely, expenses in connection with the administration of justice. In addition to the statutory sums from the above-mentioned accounts so withheld, it is estimated that out of voted monies a sum at the rate of about £200,000 per annum is being lost to the local authorities each financial year.
Why is compensation given to civil servants before the ordinary inhabitants of Ireland?
Because the police, soldiers and civil servants before the Truce were particularly liable to loss of life and wounding.
Will this money be applied to pay the loyalists who have suffered damage from the acts of the Republican party?
I regret to say that there is not enough money in this fund to pay the damage which these loyalists have unfortunately suffered.
Could not a percentage, at any rate, be paid?
Take it off the railways.
Criminal Injuries (Compensation)
asked the Chief Secretary whether he can give the total amount to date which has been awarded by the Irish Courts of Justice as compensation for the malicious burning of houses, destruction of property, and murder and wounding of loyalists since the 1st of January or other convenient date; and of this total how much has been awarded in the County of Cork?
The total amount of compensation awarded under the Criminal Injuries (Ireland) Acts against local authorities in Southern Ireland during the period 1st June, 1920, to 30th September, 1921, is approximately ÂŁ8,000,000, of which about ÂŁ1,600,000 is leviable off the County of Cork. It is impossible from the records available to state what proportion of these sums is in respect of decrees awarded to loyalists.
Has any of this money been paid?
I must have notice of that question.
Questions
Commercial Companies (Government Investments)
asked the Chancellor of the Exchequer the amount of money invested by the Govern- ment in commercial companies, and the names of the companies and the amount invested in each company?
I would refer the hon. Member to my answer of the 12th July last.
Land Values Duties (Reclaimed Money)
asked the Chancellor of the Exchequer the amount of money reclaimed through the abolition of the taxation of land values and the amount actually refunded?
The total amount of Land Values Duties repaid under Section 57 (3) of the Finance Act, 1920, is ÂŁ837,110. There are no exact statistics of the aggregate sum in respect of which application for repayment was made, but it closely approximates to the amount actually repaid.
Is this the total sum collected?
The total sum repaid.
Can the hon. Gentleman say how much was not paid back?
I shall require notice of that.
Is this a sort of indirect dole to the agricultural industry?
National Expenditure
asked the Chancellor of the Exchequer the total public expenditure to date incurred during the period of the present Parliament; how this sum is divided up amongst the following headings: Army, Navy, and Air Force, including all military expenditure at home and abroad and all War settlement charges; national debt charges; war pensions; educational, health services; and old age pensions; and all other charges?
The figures for the precise period mentioned by the hon. Member could only be made available at an expenditure of time and money which my right hon. Friend the Chancellor of the Exchequer does not feel justified in incurring. But the hon. Member will find material sufficient, I hope, for his purpose in the annual Finance Accounts and in Command Paper 1304 issued in May last.
asked the Chancellor of the Exchequer what was the total national expenditure from both rates and taxes on public assistance in 1910 and 1920 respectively, especially under any Acts relating to the Poor Law, education, provision of meals, old age pensions, public health, housing, national health insurance, unemployment insurance, &c.
The hon. Member will find all the information available set out in a recent return of the total expenditure under certain Acts of Parliament, House of Commons Paper 189 of 1921.
Is the hon. Gentle man aware that in the return to which he refers me, the expenditure on public assistance has increased by nearly £190,000,000 during the past ten years, and by about £233,000,000—
The hon. Gentleman is giving information. Question Time is not allotted for the purpose of giving information, but of getting it.
On a point of Order. I wish to ask the right hon. Gentleman whether he does not think that, in view of the disclosures in the White Paper to which he has referred me, it is necessary to have a Royal Commission on the whole subject?
The hon. Member must put a question on the Paper.
Liquidation of Businesses (Income Tax)
asked the Chancellor of the Exchequer whether his attention has been called to a custom that is springing up in business circles of liquidating businesses that have had a prosperous trading year and restarting the concerns under another name; whether this is done with the object of avoiding the payment of Income Tax due; and whether he will introduce a Bill to so amend the law as to prevent this evasion of a legal liability?
My right hon. Friend the Chancellor of the Exchequer is not aware of any such practice as is suggested by my hon. Friend. Under the provisions of the Income Tax Acts, the assessment upon a business is computed upon the ordinary three years' average notwithstanding a change in the proprietorship; relief is, however, obtainable where it is proved that the profits have fallen short from some specific cause since the change or succession took place, or by reason thereof. In this connection I would refer my hon. Friend to Rule 11 of the Rules applicable to Cases I and II of Schedule D of the Income Tax Act, 1918.
Trade Accounts (Publication)
asked the Chancellor of the Exchequer if he can give the approximate annual cost of the production of the publication called Accounts relating to the Trade and Commerce of certain Foreign Countries and British Possessions; and will he make inquiries to ascertain whether any useful object is served by its publication?
I have been asked to reply. I am informed that the cost of paper and printing for a year in the case of the monthly publication named is about ÂŁ2,000. I am satisfied that the information contained in the return is found useful, but the Board of Trade have recently decided, in the interests of economy, to issue the return quarterly, instead of monthly.
Has the hon. Gentleman made any inquiries from any commercial circles to ascertain their views as to the desirability of continuing or not continuing this?
Yes, we constantly take the views of commercial circles as to the value of returns, and as to the time at which they ought to be published, and I think that there is a general consensus of opinion that the returns which show the amount of trade foreign countries are doing is a matter of considerable interest to the traders of this country.
Rosyth Naval Base (Revaluation)
asked the Chancellor of the Exchequer whether the Treasury have yet sanctioned the revaluation of Rosyth naval base for rating purposes; and, if so, when the work is to begin?
The Treasury have agreed to a revaluation of this property, and the work will be taken in hand at an early date.
As an early date has been promised for some time, will the hon. Gentleman say when the date will be?
I am afraid I cannot give a date in my present state of information, but the date will be an early one, and, as soon as I can, I will communicate with the hon. Gentleman.
Is the hon. Gentleman aware that in the meantime the revenue is losing very heavily, and it is a serious matter to the town?
The importance of the matter is quite understood, but a decision has not yet been arrived at.
Allotments
asked the Minister of Agriculture whether he is yet taking any emergency steps to increase allotment gardens, particularly in the neighbourhood of the mining villages, where short time is likely to be worked for many months to come?
I have been asked to reply. The duty of providing land for allotments rests in the first place upon local authorities, who have been given adequate powers for the purpose. The Ministry is constantly urging such authorities to exercise their statutory powers. I would remind the hon. Member, however, that in many mining areas practically all the available land is already occupied. In any case, the provision of additional land at the present time could not mitigate hardship due to unemployment during the winter months.
Is the hon. and gallant Gentleman not aware that around these mining villages there are open farm lands, and would it not be possible to stimulate the local authorities into action where you have miners who are working only two or three days a week, and could put in their spare time on allotments?
Why should the farmers be turned out?
To increase production.
Unfit Horses (Export)
asked the Minister of Agriculture whether he can state the present position as to the traffic in the exportation of horses: whether the stricter inspection of horses on this side has prevented their exportation except in cases where they are fully fit for work; and whether arrangements have now been made with the Dutch and Belgian Governments for the slaughter in this country of horses which are intended to be sold for food in those countries?
I have been asked to reply. The measures which have been adopted by the Ministry to raise the standard of fitness of horses exported to the Continent have resulted in stopping the export trade in worn-out horses and in restricting the trade to horses which are fully fit for work. The high standard of fitness now enforced has also resulted in the slaughter in this country of a much larger proportion than formerly of horses which are intended for food on the Continent. As a result of conferences which took place between the Ministry and representatives of the Dutch and Belgian Governments during the past summer, dressed carcases of horses slaughtered in this country and officially inspected will be accepted in Holland and Belgium.
Trade Boards (Juveniles' Wages)
asked the Minister of Labour if he is aware of the large number of young persons unable to obtain employment throughout the country owing to the high wages laid down for beginners by the Trade Boards, and to the practice adopted of fixing wages and increments according to age and irrespective of merit and industry; and whether he will issue directions for the guidance of Trade Boards in this matter, and advise also that instead of national rates a system should be adopted of district rates, varying according to the prevailing circumstances of the towns and districts to which they are applied?
The information which I have does not confirm in general the suggestion made by my hon. and gallant Friend. In the cases of two Trade Boards—the Dressmaking and Women's Light Clothing Board, and the Hat, Cap and Millinery Board—the rates first fixed for juveniles caused some unemployment among girls. This fact was brought to the notice of the Boards, and the rates have now been reduced by them so that girls of 14 now start at 11d. instead of 2½d. per hour. With regard to the last part of the question, the rates are not settled by me but by the Trade Boards. I will forward my hon. Friend's view to Lord Cave's Committee.
Is the right hon. Gentleman aware that a large number of young people are out of employment in agricultural districts?
As a result of Trade Boards?
As a result of Trade Boards!
That is what my hon. and gallant Friend has asked in his question, and what I have endeavoured to answer. As regards the last part of the question, I shall, as I say, lay the suggestion before Lord Cave's Committee.
Safeguarding of Industries Act
Port Facilities
asked the Financial Secretary to the Treasury whether, in view of the congestion at the limited number of ports in this country owing to the holding up of goods pending investigation and the levying of duties under the Safeguarding of Industries Act and the Reparations Act, he is prepared to consider the advisability of opening Customs depots in the principal towns to which such goods are consigned, so that the goods can be sent forward from the docks to these different towns and cities and thus avoid the increasing congestion at the ports?
I do not think the suggestion made is one that can be adopted with advantage.
Can the hon. Gentleman make any suggestions as to the very serious congestion at the ports, especially at Hull; it ie causing great inconvenience?
My hon. and gallant Friend is not to take it that I recognise any serious congestion. The suggestion of my hon. and gallant Friend does not correspond with the facts of the case. Measures to facilitate working in this matter are always under consideration.
Invoices
asked the Financial Secretary to the Treasury if he is aware that under the Safeguarding of Industries Act His Majesty's Customs are demanding the production of the original invoices and also two copies of the same; and whether he is aware that the preparing and production of these entails a considerable amount of labour and cost, especially where the importer resides a long distance from the port, and is he prepared to accept the usual documents and bills of lading as evidence of the commodities and the value without putting the importer to this immense amount of work, especially in view of the reluctance of importers to hand over valuable trade information to forwarding agents and Customs officials, as experience shows that these documents often miscarry?
A second copy of the invoice is required only where goods are liable to the Reparation levy in addition to an ad valorem duty. The question whether this second copy can be dispensed with is under consideration. The production of the foreign supplier's invoice is essential for the proper charging of Customs duties leviable on an ad valorem basis, and I am unable to accept the suggestion that bills of lading or other documents would serve the purpose. This requirement is believed to be common to all countries which levy ad valorem Customs duties, and many of them prescribe a particular form of invoice which has to be certified by the supplier, as against the ordinary commercial invoice (not in any prescribed form) accepted in this country.
Glassware
asked the Financial Secretary to the Treasury whether he is aware that at one of the London ports a consignment of sixpenny fluted glass flower vases, known by the trade term of optic glass, has been detained by His Majesty's Customs owing to the non-payment of the 33½ per cent, duty under the Safeguarding of Industries Act, and that the importer asserts that the glass vases in question are not made of scientific glass, which is manufactured by a certain process, nor optical glass, which is usually defined as glass that magnifies, nor is the glass produced by the process known as lamp-blown; whether, under these circumstances, he will give instructions that glassware of this character shall not be detained, and thus avoid the inflicting of heavy expenses upon the importer; and why ordinary hand-mirror glasses are detained and held to be chargeable with duty whilst shaving glasses are held not to be dutiable?
I am unable, on the information given, to trace the consignment referred to by the hon. Member, but if he will furnish me with fuller particulars I will cause further inquiry to be made, and communicate the result to him. As regards the concluding portion of the question, I may say that, in general, the ordinary type of flat hand-mirror is not regarded as dutiable, but hand-mirrors or shaving-glasses, which produce a magnifying or minifying effect, are optically worked and are, therefore, dutiable as "optical elements."
Would it not be advisable, seeing so much confusion arises, that some formula should be set up by the Government that will enable the Departments to define what is optical glass as distinct from glass which is not optical glass, but merely glass of the type referred to in the question?
That, I think, is a question of the administration of the Act, which should be referred to the Board of Trade.
Would it not be advisable for the Treasury or the Board of Trade to get a formula for optical glass.
Would it not be advisable for the Government to consider repealing the Act? We get more nonsense from it every day.
Questions
Board of Customs
asked the Financial Secretary to the Treasury whether, in view of the greatly reduced volume of imports and exports, he can say what reductions have been made in the staff of His Majesty's Board of Customs during the months of July, August, and September?
The Customs and Excise Department performs many functions, both revenue and non-revenue, besides those connected with foreign trade. Import and export work is only one of the miscellaneous duties assigned to this Department, and the quantity of work attributable to each of them varies from time to time, these fluctuations being met by diverting staff from one set of duties to another as occasion requires. It is therefore not in general desirable, or indeed possible, to effect any substantial reductions in staff to correspond with temporary fluctuations in the volume of imports and exports. But a reorganisation of the whole Department is now taking place which will reflect the various economy measures now under consideration.
Enemy Air Raids (Compensation Claims)
asked the Financial Secretary to the Treasury if he is aware that claims for compensation for loss of homes destroyed by enemy airraids in London in September, 1915, still remain unsettled; that the sufferers have made repeated application to the Reparation Claims Department, but without satisfactory result; and if he can state when these compensation claims are likely to be settled?
All claims in respect of air-raid damage which have not already been satisfied will be submitted by the Reparation Claims Department to the Royal Commission on Compensation for Suffering and Damage by Enemy Action, which was appointed on the 15th August last. The Royal Commission will recommend the distribution in grants to individuals of the first sum of ÂŁ5,000,000 received by this country from Germany on account of reparation. The amounts hitherto received from Germany are insufficient to satisfy the prior claim for cost of occupation, and accordingly nothing has yet been received on account of reparation. I am unable to state when the sum of ÂŁ5,000,000 on account of reparation will be received.
Is the hon. Gentleman aware that in the neighbourhood of Deptford working-class homes were destroyed and lives were lost; that, though those concerned have waited for six years, they have had no compensation; and could not the matter be expedited?
I think the terms of the answer I have just read out give the decision of the Government on the question of the principle involved in this matter. I could not at the moment make any departure.
Mine Officials Associations, South Wales
asked the Secretary for Mines whether he is aware that in South Wales steps are being taken by the coalowners to form associations of mine officials, many of whom are members of their proper trade union; that pressure is being brought to bear upon them to join the new association and to leave their trade union; and that such pressure is resented by the officials in question; and whether the Government propose to take any steps in the matter to protect the trade unions and individual rights of such officials?
Representations have been made to me in the sense of this question, but the institution of colliery officials' benefit societies is not a matter in which I am in a position to intervene.
Airships
asked the Secretary of State for Air whether he can make any statement as to the negotiations with the Dominions in reference to the continuance of airships; and what is the present position of the material and staff connected with lighter than air craft?
I am, at present, unable to make any statement as to the negotiations with the Dominions on this matter, as no official notification has yet been received. As regards the second part of the question, the whole of the airships, material and stores likely to be of use in the event of airship operations being continued, is being stored at Cardington and Pulham. The personnel at these stations is being reduced until no more is left than will suffice for care and maintenance parties. The Royal Air Force airship personnel not required for storing the airships and airship material, or for the care and maintenance parties at Pulham and Cardington, are being absorbed in the general service of the Royal Air Force.
Are any of them being turned out of the service?
They are being absorbed.
State Taxation, Germany
asked the Under Secretary of State for Foreign Affairs if he can state the amount per head paid in Germany at the present time in imperial and state taxation; how this sum is levied; and how it compares with the similar taxation in this country?
I am not in a position to answer this question at short notice. His Majesty's Ambassador has been instructed to endeavour to obtain the information.
Egypt (Zaghloul Pasha)
asked the Under-Secretary of State for Foreign Affairs whether he is aware that the Mudir of Assuit recently issued a declaration to the effect that any demonstrations or gatherings, however peaceful, would be dispersed by the use of firearms; that Zaghloul Pasha was prevented from landing at Assuit; and that the police fired upon the crowds which had assembled to greet him and wounded a number of persons; whether it is with the knowledge of His Majesty's Government that the popular support of Zaghloul Pasha is in this way being suppressed; and whether His Majesty's Government will use its influence with the Prime Minister of Egypt to bring it to an end?
His Majesty's Government have no information with regard to the first part of the hon. Member's question. Zaghloul Pasha refrained from landing at Assuit at the request of the local authorities as an affray had broken out between his supporters and those of the Government. No details with regard to the disturbance have been received. His Majesty's Government do not feel called upon to interfere with the measures taken by the Egyptian Government for the maintenance of order.
Can the hon. Gentleman state any law which prevents Zaghloul Pasha from addressing any demonstration, or any law preventing the people from assembling in a quiet manner to meet Zaghloul Pasha?
I have no doubt that I could give him the references if he would put down a question.
Is there martial law in Egypt to-day?
Is the hon. Gentleman aware that all this is likely to menace British interests and unduly inflame the passions of the Egyptian people against us?
The hon. Member must not now argue the question.
Orders of the Day
Trade Facilities Bill
Order for Second Reading read.
I beg to move "That the Bill be now read a Second time."
The necessity for the introduction of this Bill is so great and the details are so familiar to the House that it requires from me neither narrative nor explanation. The state of unemployment in the country at the present time is grave, so serious, indeed, that in not inconceivable circumstances it might prove a menace to the social fabric of the State. Distress is acute, and innumerable households are confronted at this time with a position which is almost desperate. Ordinary humanity demands in these circumstances that we should do our utmost to alleviate undeserved suffering, and honour requires that we should give such aid as we can in the way the least wounding to the pride and the least demoralising to the spirit of the manhood of the nation. Prudence requires that we should make an attempt to seek out the causes of our present difficulties, and to mitigate where we cannot remove them. The phenomenon of unemployment, as the right hon. Gentleman the Member for Paisley (Mr. Asquith) said the other day, is world-wide at the present time. That is a reflection from which the ordinary human mind is apt to derive consolation, but its chief importance to us is that it is clear proof of the fact that the causes which are affecting us are not local but are indeed, as the right hon. Gentleman the Member for Paisley said, international. The destruction of so much of the wealth of the world and the ruin of so many nations has had the effect of paralysing trade and commerce. We are suffering to-day from a failure of trade and from the lack of industrial enterprise. These conditions affect us much more than they affect any other great nation in the world. We depend more than any other nation upon the flow of international trade. We have built up on a very narrow base of agricultural life a huge and top-heavy superstructure of industrialism, and whenever there is depression of trade we feel it worse than anybody else. If you can compare our condition with that of France you will find that France has a very much larger part of her population engaged in agriculture, and therefore these great depressions of trade do not affect her appreciably as compared with the results upon our own industrial life. Accordingly until this great depression disappears we cannot look for any very great improvement in our condition.
There is another circumstance to which reference should be made. Britain has built up her great position in the world by the fact that she has financed and carried out industrial enterprises in every region of the globe. The railways, docks, and bridges of the world stand to the credit of British enterprise and manufacture. From the City of London there has flowed more money to fructify the earth than out of any other city in the world. Unfortunately, there is no longer a flow of capital to such enterprises; indeed, the capital is not being asked for. People are not in a position to borrow as they were before, upon almost any terms without the assistance of the Government, and in many cases they are unwilling to borrow at this time because they would have to pay too high a rate of interest. I have directed the attention of the House to two of the most prominent factors which affect this problem. We are therefore compelled to ask the question—Is there anything that we can do in these circumstances to mitigate the asperities of the depression from which we are suffering and how tar can we go in an attempt gradually to remove it altogether. With regard to this second matter, namely, the difficulty of financing large enterprises, the Government propose by the provisions of this Bill to guarantee loans to approved undertakings and the money to be raised by loans is to be spent on the purchase of materials and equipment within the United Kingdom. We propose to allow such loans to be applied for by any Government or any undertaking in any part of the world. There are as the House knows to-day, several small nations which if they could raise the money in the City of London for some of their railway enterprises, would be enabled immediately to place orders in many of our factories. There are great undertakings which many of our Dominions and Colonies could carry out which are only impeded by want of the necessary finance.
We, of course, shall favour proposals that come to us from our own Dominions. It is the first duty of this country to develop the great assets which it owns throughout the world, but entirely apart from that it is distinctly to our interest to do so. They are in truth our best customers and they have proved that in time of difficulty they are our most loyal and most attached friends. Accordingly I think that in any scheme dealing with the matter we should be bound to give preference to the claims of our Dominions. Happily, many of these Dominions have already been raising money here for the purposes of undertakings within their own borders, and the energy of the Secretary for the Colonies has been applied with great vigour in recent times to that achievement. In point of fact a good deal of money has already been raised, and so far as the future is concerned, where any borrower, such as one of our Dominions, is able to raise money upon its own credit, no help will be given. But there are many Crown Colonies and Protectorates which require the aid which this Bill will afford, and accordingly we hope that such enterprises as I have described will go forward in the immediate future and thus help to alleviate unemployment in this country.
Will the expenditure be ear-marked for this country?
It will be made a condition for guaranteeing loans that the expenditure on any goods that can be produced in this country shall be made here.
That will not apply to all the money?
No, and for this reason. A large amount of labour will be required to build the bridges, construct the railways and create the docks, and you cannot provide that the money for this purpose shall be spent in this country. It must necessarily be expended locally. But so far as the expenditure of money can be made here, it will be a condition that that course shall be followed. The Bill does not confine the guarantee of such loans to the cases of people overseas whether apart from or belonging to our own Dominions. It deals also with the case of enterprises to be carried out within the borders of the United Kingdom. There are many such undertakings which are only waiting to be financed on suitable terms to go forward. There are light railways in several parts of the country. There are electrical undertakings; there are projects for the extension of docks and harbours. For all enterprises of that kind which are particularly desirable under these cir cumstances guarantees will be given for loans. The result of the Government guarantee in almost all instances will be to enable the borrower to obtain cheaper money than he would otherwise obtain for himself and that at the present time, in the condition of the world's finance, is a great factor in the problem for the people who are undertaking such enterprises as I have described. It is intended to set up a small expert committee to deal with these applications. Quite obviously it must be a committee which will command public confidence and which will be assured of being free from bias or prejudice. I have no doubt that when the names are made known the committee will satisfy these conditions.
Will the Treasury have the last word or will the committee have plenary powers?
4.0 P.M.
The Treasury will not appear in the picture at all. The Committee will have full control. If there were a question of the amount of money—if the amount of money that could be lent or guaranteed was left indefinite, it would be impossible to leave the Treasury out of the matter, but since the amount of money is to be fixed by the House of Commons, the question of determining which particular undertakings are most deserving of support will be left to the judgment of the Committee.
Can the right hon. Gentleman give us the names of the Committee?
The names of the Committee will be communicated to the House in due course.
I am very glad to hear that it is so, but it is not in the Bill.
The Bill gives discretionary power to the Treasury, but it says nothing about the Committee, which, I suppose, is purely advisory.
The situation will be as I have described it. The Treasury will not seek to exercise a discrimination between one scheme and another, but will leave it entirely for the Committee to decide. The House will readily appreciate that it would be impossible for any Government Department or any political body, or any committee which was supposed to have any political predilection whatsoever, to be subject to the influences which might be brought to bear. You must put such a matter in the hands of a committee which shall be free and un-tramelled.
Does that include the terms and conditions of the loan as well, because the Bill specifically states that the Treasury may guarantee in such manner and form and under such conditions as they think proper.
The terms and conditions will be left to the consideration of the Committee alone.
Is it not the case that this will be entirely a matter between the Treasury and the Committee? It will be left to the Committee, but the Treasury will still be responsible to this House for everything done by the Committee.
The Treasury necessarily will be responsible for seeing that no larger sum than that to which the House agrees shall be guaranteed. The policy is as I have been describing. If the House approves the Bill, it will approve the policy. Therefore, no question of policy arises. The only question which remains is what particular undertakings are to benefit by the guarantee, and in that matter I am perfectly certain that it is wise that the discrimination should not be left to any Government Department. By the Bill, of course, the Treasury still remains as the body which is in charge of the fund, but I am describing to the House the procedure under the Bill. The schemes which would obtain the most ready support are those which provide the most immediate employment. At the present time we wish to do every- thing we can to alleviate present conditions, and, accordingly, those schemes which are most ready to go on and which will provide most immediate work for the labouring people of this country will tend to be most favoured.
There are two limitations put in the terms of the Bill. One is as to time. The provision with regard to that matter is that guarantees can only be given for a year. Of course, that does not mean that the work must be completed within the year, or that the money is all to be spent within that period. It means that the period of 12 months from the passing of the Bill is the only period in which applications may be made for a guarantee, but guarantees may be given up to the last day of the year, and the operations may be carried on subsequently until they are complete. The other limitation is that the loans guaranteed shall not exceed ÂŁ25,000,000. If any comment falls to be made on the limitation which has been placed on the amount, and I see in certain circles that it is suggested that the amount is not enough, I think the House should have regard to the other sums which are being spent upon this problem of unemployment. The House will keep in mind that the Government have a commitment under the export credits scheme to the extent of ÂŁ26,000,000. Only ÂŁ3,000,000 of this has up to now been taken advantage of and all the rest of the money falls to be expended during this and the immediately following years in which, I am afraid, the finances of the country cannot be very much improved as compared with the present. Further, the Government are providing a sum of ÂŁ10,000,000 for other purposes connected with this problem, namely, for the help of boards of guardians, for the provision of the Government share of the fund necessary for the support of dependants of workmen, in accordance with the provisions of a Bill which received its Second Reading yesterday, for forestry schemes, for drainage schemes, for road schemes, and for the acceleration in the present year of Government work, for example, the building of ships, in various parts of the country. Accordingly, our obligations extend to a very much larger sum than that which appears in the present Bill.
In addition to the figures which I have mentioned, there is another provision which I am afraid has generally escaped notice in connection with these discussions on the problem of unemployment. The Government have undertaken to provide, in connection with works carried out by local authorities and by public utility bodies, half the interest for a period of five years in the case of works which are expected to be subsequently remunerative, and 65 per cent, of the interest and sinking fund for a period not exceeding fifteen years in the case of works which are not expected to be subsequently remunerative. That is an obligation which we estimate will cost us at least ÂŁ300,000 a year and will extend over a period of about fifteen years. Accordingly, in the views taken of the amount which is to be provided under the provisions of this Bill, I hope hon. Members will keep in mind the very large obligations which the Government are otherwise undertaking at a time when indeed the financial situation, not merely of this country, but of the whole world, is one of very great difficulty. I do not propose at the present time to say anything as to the particular situation in which the finances of the country stand. I have undertaken on the Consolidated Fund Bill to tell the House as nearly as I can what the position at the present time is, but I am sure the House would not expect that somewhat elaborate explanation from me now. It is sufficient for me to say that the obligations which we are undertaking in connection with this problem of unemployment are very great, looking to our present resources. I should like to add that if this experiment, because indeed it is an experiment, proves fruitful and is shown not to have involved too great a burden upon the country, then the opportunity obviously will arise when the House meets again of considering whether any extension should be afforded.
I turn now to the provisions in the other part of the Bill which are concerned with what is generally known as the scheme of export credits. That is a matter with which the Government have been dealing since the year 1919, and the details in connection with it are more or less familiar to the House. I should like, however, to remind hon. Members that the difficulty which originally confronted us in connection with this matter of export credits was that, while traders in this country had large quantities of goods to export, our customers in the less fortunate countries of Europe were not in a position to exchange any products of theirs for our goods. They were not in a position to pay, but there was a promise that at a given time they would be able to meet the obligations which they had undertaken under their purchases. The difficulty, however, arose that nobody could tell in connection with these countries what the condition of their exchanges at any future time might be. Accordingly, exporters in this country were very unwilling to undertake the very obvious risk which they run in the possible depreciation of the foreign exchanges. One has only to look at some of the figures to realise what an amazing risk it would have been and will be. There was, therefore, no possibility of our doing trade with these particular customers, nor of reviving industry within these countries which were so much in need of it. The Government devised a scheme in which they provided that they would take a portion of the risk, and, if hon. Members will seriously consider it, they will see that it was in fact a very generous scheme, although, in point of fact, it involved a considerable risk to the exporter. We guaranteed 85 per cent, of the amount in the exporter's invoice, so that he could get from his bank an immediate advance of 85 per cent, of his account. Thereafter, if the importer could put up any security, we undertook to carry half the uncovered risk, and, even in cases where the was no security at all, we undertook to meet half the uncovered risk.
Let me give an illustration of what I mean. Supposing in any case an importer, say in Rumania, purchased from an exporter in this country. We guaranteed 85 per cent, of the bill, and, there being no security at all, we undertook 42½ per cent, of the risk thereafter, and indeed in the event of the exporter failing we had to bear the whole burden of the guarantee. The way we covered the risk was by having recourse against the exporter to the extent of 42½ per cent, of the bill. The House will agree that that was a very generous scheme, but it has not succeeded. Less that £3,000,000 worth of business has been done under it. It has not succeeded, I am informed, because, in the first place, the method of dealing with transactions was too dilatory, and, in the second place, the exporter wanted immediately a guarantee of more than 85 per cent of his bill. What we propose to do in the present circumstances is as follows: in the case of short credits, we shall guarantee at the beginning the whole of the price of the goods—100 per cent.—so that the exporter has immediately made available to him the full amount of his account. Obviously, it makes a considerable difference to him to have the 15 per cent, as well as the 85 per cent, in his pocket, because it is money to trade with, to carry on, and to give him facilities for doing more business.
What is the limit of a short credit?
The limit is a year. To that extent also we increase our risk if the exporter is in the end unable to pay and if the importer fails; but we get recourse against the exporter for the same amount as we previously had, so that, in the event of the exporter being a substantial man and being able to carry through the transaction, we run no more risk than we did under the previous scheme. We give the exporter, however, the advantages I have already described in the way of monetary facilities.
All this is within the balance of the ÂŁ26,000,000?
That is so. This requires no alteration in the Statute which set up the scheme of export credits; it only requires a Regulation, and, therefore, hon. Members will find nothing about it among the provisions of this Bill. There are two matters which do require to be dealt with in the Bill. There was in the previous Bill a limitation of time for the completion of such transactions. The period ended, I think, in September, 1925. That period it is now proposed to extend, under the provisions of this Bill, to September, 1927, and for this reason: It was found, in connection with large constructional contracts, that it was impossible to complete some of those, in the case of which applications had been made, within the time which the Bill prescribed, and we came to the conclusion, accordingly, that it was advisable to extend the time. A more important provision is to extend the area in which business may be done to the whole world. The original scheme was designed to help in the reconstruction of the countries in Europe which had been most hardly hit by the War. Now, I am afraid, it is transformed into a measure for helping British trade at a time when it is in a very serious condition of depression. It is clear, I think, that it will be easier to do business with many other countries, whose credit is better, than it was with some of the countries with which we have been trying to do business in the last two years. Accordingly, so far as the problem of unemployment is concerned, we believe that a good deal will be done under the new provisions of this Bill. No doubt hon. Members will ask what has become of the Ter Meulen scheme, of which we have heard so much. That, undoubtedly, is of the nature of a counsel of perfection. I believe that it will ultimately succeed, and that, when it does begin to operate, it will have a very considerable effect in restoring trade in Europe. In the meantime, it takes a considerable time to get it put into operation, and we cannot wait for the benefits which may be expected to accrue from it.
I have expounded the provisions which are embodied in this Bill. There will probably be at least two criticisms, possibly a great many more, upon the measures which we have taken. It will be said, I have no doubt, as I see it frequently stated in the Press, that it is no good doing these things until you have stabilised the exchanges. Quite frankly, I confess myself unable to understand what is meant by that statement. The state of the exchanges is a symptom; it is not a cause which you can either eradicate or alter. You might as well ask the master of a ship in the middle of the Atlantic Ocean to stabilise his craft, as ask somebody to stabilise the exchanges of Europe, The real fact is that to bring the exchanges back to normal you must restore the production of wealth and the interchange of commodities. Until you get that, you can hope for very little from any artificial action in connection with the exchanges.
Stop printing paper money.
If you have an adequate production of wealth, you will not require to print paper money. It is be- cause you do not produce enough to carry on with that you are reduced to the expedient of printing paper money. The second criticism which I anticipate, and which, indeed, has already been made, is that you will not achieve anything by such measures as this unless you succeed in reducing the prices of the commodities which you are trying to sell. I am sure that that is a perfectly true criticism, and, in the operation of these schemes, a very careful watch will require to be kept that they are not used for the purpose of keeping up prices. If that were to happen, they would do more harm to employment than good; Accordingly, both under the one scheme and under the other, I hope that the Committees will take very good care to see that the prices upon which the business is being done are not such as simply to give an opportunity for the conduct of a trade at prices greater than the condition of the world at the present time justifies.
Is the Committee going to determine the cost of production of everything in the United Kingdom?
No. That, undoubtedly, would be too much to expect of any Committee. But suppose you take, for example, the case of the export credit scheme. The Committee which has been acting for the Board of Trade has necessarily, in dealing with the applications which have been made, had to consider at what price the vendor was proposing to sell. If they had not considered that, it is perfectly obvious that many a stockholder in this country would have been anxious to get rid of his surplus stocks at a price which an importer might be perfectly willing to agree to if he believed that there was not very much chance of his paying it, but, nevertheless, at a price which would leave the exporter with a higher profit than was justified by the condition of the market. In point of fact, the Committee which has been dealing with these transactions has already found no difficulty in getting the prices of such stocks, and arriving at what would be a just charge in connection with the articles in which dealing has been taking place; and I have no doubt that they will be able to do so in the future. On the other hand, in dealing with the question of a loan, if it turned out, for example, that a loan was required for building a railway which was going to cost per mile something which would make it quite impossible to carry it on afterwards at a profit, obviously the Committee ought to turn down such a scheme. In that way they will be able to see that the contractor is not committing himself to unjustifiable prices, which in the future would only have the result of creating difficulty over that particular transaction. I do not think the difficulty is nearly so great as the hon., and gallant Member thinks, and I am sure that, as business men, the Committee will have sufficient regard to these matters to make an efficient check upon the transactions which will pass through their hands.
The reduction of prices, however, is the most prominent matter to keep in view in dealing with this whole question. There are three parties involved in the question of prices. The first is the Government. One of the greatest burdens upon industry at the present time is the expenditure of the Government. As I think the House very well knows, I have been hard at work ever since I assumed my present office, and I can assure the House that that is a matter which is not only receiving every consideration, but also executive action, and I hope that a very considerable reduction will be seen in Government expenditure in the Estimates which are by-and-by to be presented. Certainly nothing will be wanting on our part to try and achieve the best results in connection with that matter. The two other parties to the question of prices are the employer and the workman, and I think that it will not be unwise, and I hope that it will not be regarded as officious, if I venture to address a word to each of those parties to the question of production. There are, undoubtedly, amongst employers, men who pay far too slight a regard to their part in reducing the cost of production. There are many factories in this country which are managed in such a way as to increase the cost and create an unjustifiable price for the article produced; and they on their side are just as responsible for the high prices that rule to-day as either the Government in the case of its expenditure or the workman in the case of his wages.
On the other hand, as my right hon. Friend opposite has recently courageously said, wages reached a point in this country during the War, and have been main- tained since in many cases at a level, which present conditions do not justify; and, since there is a mutual recognition on both sides of these facts, I hope it will be possible in the immediate future to get such a co-operation between the employer and the workman with regard to this question as we have never before seen. I am sure that that is the first essential to the revival of trade. Without it, we may have palliatives, but we shall never have permanent success. No one expects, I am sure, and no one would claim for this Bill, that it is going to solve this great problem. All I claim for it is that it proceeds on right lines. It does not seek to relieve unemployment by giving something in exchange for which no work is done. It does not seek to demoralise any workman by putting him on work which is entirely uneconomical. It is designed if possible to give the man the work which he is accustomed to perform, and that, I am sure, represents the soundest lines upon which we can proceed. What I hope, as the result of this Bill, is that it will bring back confidence where now there is only apprehension; that it will restore enterprise where adventure has disappeared; and that people, once trade begins again under the new circumstances, will take a new heart and a new spirit and will enable us to face with more courage the great problem confronting us.
May I ask the right hon. Gentleman one question?
I think not. The hon. Member must wait for his turn in Debate.
The right hon. Gentleman has, both at the start of his speech and at the conclusion of it, delivered himself of some wise saws and sound axioms which, if they had been the measure of the action of the Government since they took office, would have put this country in a far less unhappy position than it is to-day. I notice that in estimating some of the causes of the unfortunate financial position in which the country finds itself at present, he made no reference to what many of us on this side of the House believe to be one of the principal causes. The disastrous, indeed the calamitous War was followed by a bad Peace, and from those conditions of peace there arise to-day, undoubtedly, many of the main factors of the unemployment with which, as he truly says, the whole world at present is afflicted. One of his points which received a most hearty response from all parties in the House was his attributing as one of the causes of the difficulties of to-day Governmental expenditure. He gave us some hope at any rate that owing to the action of the Committee set up outside this House, usurping the proper functions of this House—measures for Government economy and Government control are essentially the function of this House and not any outside committee—we may have some sweeping and drastic reductions. Just look at one expenditure of our own. Since the days of the Armistice up to the end of the present financial year, we shall have spent on the Navy, the Army and the Air Force very little short of £1,000,000,000, and our example has been followed, or worsened, by the efforts of European countries, small and great, old and new. I was this morning looking at the report of a speech by Mr. Henry Bell, the general manager of one of the greatest banks in the world, Lloyd's Bank, and himself a man of the very highest standing in banking and financial circles. In a speech he made after he came back from Brussels, he drew the attention of his audience to the disastrous effects on trade and commerce of this same class of expenditure in European countries. He gave a list of 13 countries, starting with Esthonia and Czechoslovakia and winding up with Germany and France. He said, "If you could cancel out the military expenditure since the War you would cancel out in many cases the whole deficit, in other cases half the deficit, and in other cases it would be less of course, where the military expenditure has been small." We are to some extent recognising, but the whole world must Recognise as well, that a revival of trade will never be fundamentally accomplished until this insanity of military expenditure is brought to an end. While I still think we are spending far too much, there has been a reduction in the Votes which have been from time to time presented to the House.
I agree with what the right hon. Gentleman said as to the necessary co-operation between employed and employers. That, of course, is perfectly true, and no matter what devices may be suggested by hon. Members who sit behind me, the practical thing is to recognise the existing systems. We must work them as we find them. It is also true that we cannot get back our dominant share of the world's trade unless we can go into the markets of the world at a competitive price. There is no getting away from that. The whole world is moving upon a competitive, individualistic system and all these schemes and splendid and noble ideas which we may read of are irrelevant to the dealing with the present situation. The world is individualistic, and there is no hope of a Socialistic system growing up to compete in an individualistic world. That must be recognised in grappling and dealing with the existing situation. With regard to the Bill, I agree that it is minor in its ambitions. The Chancellor of the Exchequer does not claim very much from it. He hopes it will be a move in the right direction. Of course trade, amongst other things, is very largely based on psychology—upon confidence—and any movement in the right direction should not be measured in its beneficial results by the immediate effects which for the moment we see, and therefore if the first part of the Bill, which contains the proposal to allocate £25,000,000 for the purpose of assisting public authorities or any corporation or other body of persons—I presume that includes any private limited company in commercial operation in this country—for the purpose of carrying out any capital undertaking and also for backing their loans which are raised for the manufacture of articles in connection with that capital undertaking, is soundly and carefully done, its effects ought to be far beyond the £25,000,000 which are proposed to be allocated to it.
I will first of all deal with the very important point which was raised with regard to the Advisory Committee. Several hon. Members pointed out that there was no mention of the Advisory Committee in the Bill itself. I think the Advisory Committee ought to be mentioned in the Bill. It is sound constitutional doctrine to set out in your Acts of Parliament as clearly as possible the fundamentals upon which the Measure moves, and the right hon. Gentleman treated this as one of the most important parts of the proposal. The Credits and Insurance Act of 1920 say "with the consent of the Treasury and after consul- tation with an Advisory Committee." I am sure that will meet a very general and very sound criticism which has already been made. I should have complete confidence in the operation of that Committee. I think, on the whole, it is quite sound that it should be composed of members well known in business and financial circles and, at any rate as far as the majority is concerned, not of Members of this House. It is a proposal which has acted before with very considerable success. There was a Committee set up on foreign trade in the early days of the War, which on the whole worked with a considerable amount of success, and the beneficial results were by no means confined to the acts of the Committee itself. They spread a general feeling of confidence in which the commercial world, as far as its operations were concerned, and some trade began once again to move and have its being. So far as that is concerned, I have very few criticisms in a general way to make, though in Committee the matter, no doubt, will receive very full and careful consideration.
I wish now to make one or two general observations with regard to the credits scheme. The Chancellor of the Exchequer says it is of the greatest importance that in this effort to set business going again we should remove all unnecessary obstacles in the way. I will suggest to him one obstacle which he can very readily remove, and that is the Safeguarding of Industries Act. The Government, while assisting our own manufacturers, are subsidising foreign traders and enabling them to get better goods at lower prices in the competitive world owing to the operation of these proposals. There is only one way in which they can pay us, and that is by sending us back the goods we want. I should have thought it would have been the most obvious common sense to clear away any obstacle in the way of these goods which are going to pay us as the result of our subsidies. The Government devoted a very large portion of the time of the House to passing the Safeguarding of Industries Bill, which is really a Bill for the obstruction of business. Now the Board of Trade have published in a book of 70 pages a first list of some 6,500 items to which that Act applies. Of course they have to block the whole of the business before they can pick out those articles which come within the scope of the net of the Act. I think economic insanity has almost reached its zenith. I suggest that the Government should follow their usual practice and repeal the Act. There need be no question of amour propre . Let the repeal, be carried out by the complacent majority behind the Government, and the Government will receive our hearty assistance and approbation. The whole business community has come to the conclusion that that Act is useless, unnecessary, and dangerous to business, and should be got out of the way as speedily as possible.
I am glad that the Export Credits Scheme is to be extended to every country in the world. It shows how we are getting on when, in face of such a proposition, no voice is raised to say, "Surely you will not include Germany!"
And Russia.
The economic facts of the situation are beginning to impress themselves upon even the most prejudiced mind. I am not overstating the case when I say that until Germany gets upon her trade legs again there is little or no hope of a real revival of trade in the Near East. I do not feel friendly towards our late enemies because I feel very much, still, the effects of the War, but, after all, we have to face the facts of the situation, and we cannot go on cutting off our noses to spite our faces in this ridiculous manner any longer. We must recognise the economic fact that we have to get Germany going, in the trade sense, before we can expect anything like a sound revival of trade in the Near East. She is the great distributing centre. There are goods of every kind of British manufacture in the Far East which have got there through German agents. That is the only way in which trade with Russia can begin to be re-established. They have the machinery in Germany, and they are nearest not only to Russia but to the other units of commercial activity and productivity there. Therefore, I am glad that not only Germany, but Russia, is brought within the ambit of this Measure.
indicated dissent .
What! Is Russia not in?
Russia is a country, and the Bill says "any country whatsoever."
That is permissive on the part of the Board of Trade.
Of course, it is in the discretion of the Advisory Committee and the Board of Trade, but so far as the Statute is concerned it is open at any time to extend its operations to Russia.
Oh, yes. We are not excluding Russia.
There are other limiting words in the original Act, and I hope that this will be borne in mind by my right hon. Friend before an Amendment is put down in Committee. The governing words of the original Act are:
Speaking generally, the Measure will cause very little difference of opinion in principle. Speaking for those who act with me, I can say that we shall give every assistance we can to the right hon. Gentleman to make it a more workable Measure than in many respects it appears to be at the present time. However useful and well-thought-out the scheme may be, I agree with the Chancellor of the Exchequer that we want to get at the causes. The fluctuation of the exchanges are symptomatic and not causative. You must get down to the root causes. In this respect the business men should realise that it is their duty to become politicians. [HON. MEMBERS: "No!"] Yes. What is it that is disturbing business all over the world but the politics of the various countries? There is no more futile observation than the statement, "I am no politician." Bad business is caused by bad politics. We want to take broad views and to make a sound and useful Measure of the proposals contained in this Bill.
Whatever be the criticisms that may arise in the minds of hon. Members, I am right in saying that the House recognises that in introducing this Bill my right hon. Friend gave a "lucid and comprehensive exposition, which has left very little doubt as to what is intended by the Government. There are, however, two wide-spread mistakes as to the scope and the effect of the Bill which my right hon. Friend did not make a clear attempt to remove. The first mistake is that the Government will find ÂŁ25,000,000 in cash, and no more. That is the general idea prevailing as to the intentions of the Government. The second mistake is that the ÂŁ25,000,000 is the utmost limit of the assistance to unemployment which will arise out of this Bill. The late Minister of Health made that point in his speech. Both these suggestions are absolutely unfounded and untrue. The presumption that the Treasury, armed with the powers that this Bill will give it, in guaranteeing new undertakings will be at an expense of ÂŁ25,000,000, is a very exaggerated and foolish presumption, although the Committee and the Treasury, who will share the responsibility between them, will select such enterprises for guarantee as will give the utmost limits and the utmost amount of employment, it will be their duty to select such enterprises as are reasonably safe. These sort of risks have been underwritten in the city before. If the Committee and the Treasury in conjunction make anything like the wise selection that I anticipate, they will, perhaps, be running the risk of an amount equivalent to a premium at Lloyds of 5 per cent. If so, the ultimate amount which the Chancellor of the Exchequer will have to find out of the national purse will be something like ÂŁ1,000,000 or ÂŁ1,250,000. Let the House and the country quite understand that in these guarantees the Government are not, in all probability, placing upon the Exchequer any larger expenditure, ultimately, than, perhaps, ÂŁ1,000,000, ÂŁ1,250,000, or ÂŁ1,500,000.
5.0 P.M.
The other misunderstanding is that the expenditure is limited to ÂŁ25,000,000, and that the benefit to the unemployed is limited in like manner. That is an entire misunderstanding, because the benefit that will arise from these guarantees will be two-fold. There will be the primary benefit to those who are unemployed, and there will be the benefit to everyone who is depending upon the unemployed, by the unemployed person being supplied with the wages so that he can purchase articles. It is impossible to say to what extent this small amount of assistance may go in the ultimate event in the way of improving trade. Take the case of the light railway that was mentioned. There you have employment given not only to the men who will make the cutting and raise the embankment, but to all those employed in the factories who are manufacturing the rails, the locomotives, the pickaxes, the shovels, and other articles necessary for making the railway. Therefore the direct assistance to unemployment can only be a single and commencing item in the total assistance which will ultimately reach those who are unemployed, not only in regard to the trades that will be directly assisted by the guarantee, but the other trades which are depending upon them. Reference has been made to the necessity for cheapening production and bringing about a better understanding between employers and employed. May I give one instance of the difficulties in which this country is at present in its competition with foreigners? About two months ago a ship of small tonnage went aground in the North Sea. It was got off and came to the Thames for the purpose of repairs. After being examined in dry dock, tenders were called for, and the lowest tender from a firm on the Thames was ÂŁ6,700. A tender came from the North of England for ÂŁ5,500, and a tender came from Rotterdam, where they can obtain the steel necessary for the work from Germany at less than half the price at which the steel can be furnished in this country, for ÂŁ1,800, or lese than one-third the amount of the tender from the North of England.
That is perhaps an extreme instance, but it is one which came within my own knowledge with the last few weeks, and it gives one furiously to think to realise that the work had to be taken away, according to the economic position of those who were concerned, from this country, not only, I venture to say, because the prices were high by reason of the big profits which were expected, but also by reason of the very large wages that would be involved in the work and by the high cost of the material. That is an illustration of how necessary it is for workers and employers in this country to get together to bring about a reduction of cost, which I believe, from long experience, can be done without any great sacrifice, to enable us to compete on fair terms with foreign countries.
Does the hon. Gentleman realise that if, in the particular case which he has given, the workers had worked for nothing, even then the tender could not have been obtained?
I am afraid I do not understand what my hon. Friend says.
The statement made is that the tender from Holland was for less than one-third the amount of the lowest tender by any British firm, and the hon. Member went on to point out the necessity for employers and workmen getting together to reduce cost of work. Has he considered that if the workers in this case had worked for nothing the British tender even then could not have been accepted?
No, I am afraid that my hon. Friend has not made his calculations accurately. The workers who actually carried out this work, I am told, were receiving wages very nearly as great as the wages paid in the North of England for similar work, but they were working much longer hours and they were free from many of the restrictions which unfortunately do hinder some of the workers in the shipbuilding industry in the North of England, and, in addition, the profits which were expected were very much less than the profits that would have been expected in this country. But above all, the reason of the difference is that there was more material than labour in this particular contract, and the steel which was required came into Holland at less than half the price at which we can produce steel in this country. That is a very extreme case, but it is a very recent case, and may interest the House as an illustration of what is happening.
To my mind the great good in this Bill is the fact that was set forth by the Chancellor of the Exchequer in his speech that there is an intention to give preferential treatment under it to the Crown Colonies. For the self-governing dominions, such as Australia and South Africa, notwithstanding what the right hon. Baronet the Member for the City (Sir F. Banbury) interjected during the course of the Debates, there is no real difficulty, as shown by recent events in the City, in raising practically any amount which they require. But the Crown Colonies are much less well known, and it is impossible for most of them without assistance from the Imperial Government by way of guarantee, to raise the funds that are necessary. During the seven years that have elapsed partly of war and partly of the aftermath of war, hundreds of indents which the Crown Colonies would have sent over in the ordinary course have not come, chiefly because of their own poverty and also because of the high prices in this country arising from the War. Those indents are still waiting to be sent and to be executed, and if the money could be borrowed by the Crown Colonies I do not think that my right hon. Friend has realised the enormous amount of trade which will come from the Crown Colonies by reason of that assistance if it is properly given. It is not only that we shall give assistance to unemployment in this country, but we shall be building up in all these Crown Colonies the structure for future prosperity and future Imperial unity.
Think of what is meant when we speak of the Crown Colonies. The Under-Secretary of State for the Colonies has told us to-day in answer to a question that he is going to the West Indies. He will find there British Guiana, Trinidad, the Barbadoes, Antigua, and the other Crown Colonies. Let him continue his journey and go a little south to the Falkland Isles. Again, to the east there are Nigeria, Gambia, Kenya. Then, further east, Mauritius, the Fijis, the Federated Malay States, and Ceylon. I could name 20 of the Crown Colonies the names of which are not familiar, as they ought to be to the House and the country. I have enumerated some of these Crown Colonies because I want to recall, if I can, that these colonies flying the British flag, which are dotted over the whole surface of the globe, form the basis of our future Imperial prosperity. Every shilling which is wisely advanced to them by the British investing public will come back a hundredfold in prosperity at home and in our future development. Railways, harbours, factories, wharves, and river and lake steamers, are all waiting to be constructed and when constructed will produce tremendous prosperity.
One word about the surprise packet which was in the speech of the Chancellor of the Exchequer. He told us, as I understood, that the duty and responsibility of selection would rest on this Committee which is not even named in the Bill. I think that the Treasury ought not to be allowed by this House to divest itself of its responsibility. An Advisory Committee by all means, to advise, and to take the responsibility of advising, but the responsibility of the Treasury to this House unimpaired and untouched even by the work of a Committee of that kind. As I understand, for any mistakes that might be made the responsibility would still rest afterwards on the shoulders of the Government and of their supporters. I hope that in Committee the right hon. Gentleman will see his way to modify the suggestion which he has made and to adopt that of my right hon. Friend the Member for Peebles (Sir D. Maclean) that the Committee should be named in the Bill or that the constitution of it should be set out in the Bill, and that the responsibility as between the Treasury and the Committee should be set forth very clearly. This matter of selection is a very serious one. There may be favouritism. I do not for a moment suggest that there would be anything worse than favouritism, but there might be favouritism, and it is of the utmost importance that the selection should be made in such a manner as not only to remove any suspicion, but also to provide a two-fold security for the ultimate success of the enterprise, which, I think, is the secondary consideration, and what I consider the primary consideration, of giving Imperial assistance to those who are at present unemployed. Taking the Bill as an experiment, as it has been called, and taking it as a whole, I am sure that the House will wish it every success. I have every confidence that it will be a success, and I am encouraged by the statement of the Chancellor of the Exchequer that, if it is a success, its scope will be extended by further legislation.
From the speeches to which we have listened during the last two or three days it appears that there are very few who have spoken who have any immediate knowledge of the employers' case. There are very few employers of labour, in active management, in this House. A great deal has been said in a general way about remedies for unemployment, but a great many of these involve waiting for a considerable time, and the question just now is very grievous and very urgent. Little has been heard in the last few days about an immediate remedy. It is all very well to talk about Germany, Russia or Austria. It seems to me that some of those who speak so appealingly about these countries are more inclined to criticise the Government for their foreign policy than desirous of helping to solve the immediate question of unemployment. It may be that in course of time the exchanges will become more stable and that some of these countries may become customers, but at the present moment, even with the guarantees of the Government, I do not think there are many merchants and exporters who would care to take the risk of transactions with those countries. Perhaps some rash exporters may do so, but they are the very people of whom the Government will have to be wary.
It comes rather badly from the Labour party to cast the whole of the blame for the present position upon the Government. Labour Members talk of the Government not having prepared and not having seen ahead. I am not going to say whether the Government might not having seen further I ahead; but many, like myself, who have been in business for nearly half a century and have seen many cycles of unemployment and bad trade, never believed that the slump would come so suddenly and so severely. What those in business could not foresee, I cannot imagine that the Government could have foreseen. Could the Government have conceived it possible that in connection with the coal strike the men dependent on that industry would actually destroy the means by which they earn their living? I say advisedly, and I have said it in a visit to my industrial constituency and sometimes it has caused some uproar, but still it is the truth, and I do not care where I say it, that nothing has done so much injury to the trade and commerce of this country, nothing has aggravated the position so much as the coal strike. [HON. MBMBEES: "Lockout!" and "Peace Treaty!"] It is childish to argue now whether it was a strike or lock-out. I will call it a dispute if hon. Members like. That dispute threw more men out of employment than all other causes put together, and until we can get the position rectified all palliatives will take a long time to work.
This Bill is one of several measures which the Government has brought forward to help us over the present crisis. But it is impossible for the Government to carry these burdens. It is we who have to carry the Government on our backs and not the Government that carries us. [HON. MEMBERS: "The people are carrying you on their backs!"] These impertinent interruptions will not affect me in the slightest degree. [HON. MEMBERS: "Do not preach!"] It is not a matter of preaching. I hear many things said from the other side, and I am going to give my answer. I have been accustomed to this sort of thing throughout a tour of my constituency. The cry is constantly heard for freedom of speech, yet whenever we begin to tell the other side what we think, they resent it and try to disturb us. I am not going to be put down by such methods I would not have referred to this subject at all had there not come from the opposite side a tirade of criticism of the Government. It comes very badly from the Labour Benches to throw all the blame on the Government.
Take the question of the high cost of production. I do not think that the cure is always a reduction of wages. Personally, I have no desire to reduce wages. I would like to see them kept at a good level so that men may be content, but it must be remembered that we have to live on our industry, and if we cannot get orders and if there is nothing out of which high wages can be paid, it is futile to expect the Government to offer subsidies for the maintenance of what is called a standard rate of wages. A good deal has been done by amicable arrangement between employers and employed, and I find amongst sensible workmen a very strong feeling in favour of such co-operation. None the less, I am bound to say that trade union delegates have sometimes come down and an arrangement that was about to be made, to which the men were agreeable, has been knocked on the head. How in such cases can you expect a feeling of amity and co-operation to exist? A great many of the trade union leaders, who speak with one voice here and with another voice outside, are maintaining a constant demand for the abolition of the capitalist system. In other words, they are wanting constantly to abolish us and at the same time they expect us to show good will and to co-operate with them. The feeling on our side is one of good will.
Why not drop the insane idea of the nationalisation of everything and try to work on practical lines? Men's minds have been so filled with suspicion that they never will believe that an employer can do anything from a good and high standpoint. Let me give an example. Not a few shipowners, like myself, are going on with work now which is wholly uneconomic. We are going on with tonnage which we do not want and will not want for many years to come, and which, when delivered to us, will not be worth one-half the price paid by us. If an employer was thoroughly selfish he would say, "Do not go on with this ship just now; hold her back until prices come down." Prices are coming down. Steel has fallen ÂŁ10 per ton within a few months. The selfish owner's policy would be to put everything off as long as possible. Private people are adopting that policy. Many of them say, "We will not buy such and such an article now because it is to be cheaper a little later." That accounts for a great deal of the falling off in trade.
There are many of us who would go on with much work if it could be done more economically. I do not know whether this Bill will meet a case of the kind I have in mind. It is a case where a big dock authority is willing to help in providing employment. There is no need to go on with this particular dock scheme at the moment. Owing to the falling off of trade, the dearness of money and one thing and another, the cautious policy is not to proceed with the work. We have been considering seriously whether any part of the scheme could be started. Material is still very costly—wood and cement and stone. Labour is still very dear. We cannot afford to do the work because nearly all harbour authorities are just as hard up as the British Government. It is unwise of us to spend on unprofitable work money that is not our own. Our proposition is this: We are perfectly willing to go on with some of that work immediately, provided that the Government, instead of giving doles to men for doing nothing, will pay something towards the extra cost we shall have to incur. If I am told that the Government are prepared to guarantee the expenditure so that we may borrow at a low interest, and are prepared also to furnish us with the money for so long a time, my answer is that the authority over which I preside can borrow money just as cheaply as the Government, at 5½ per cent., and there is no benefit to us there. It is the heavy cost of the suggested work that is the difficulty. We are willing to bear the high cost of material and labour if we had the assistance of the Government to bridge the difference between the present-day wages and the wages which we may expect to pay some time hence.
The Government in the last day or two have done work which will give an enormous amount of help in coping with unemployment by the placing of orders for three battleships. I hear an ironical "Hear, hear." I heard the same thing from some of the audiences I have recently addressed. I said to those audiences, "What would you do with the money?" They replied, "Houses," and others said, "Pay the unemployed a standard rate of wages." That would be a very profitable way of spending money! I am thoroughly in accord with the policy of the Government in placing the orders for these ships. On the Clyde it will mean employment for 12,000 men who otherwise would be without work. There will be employment, not only for the shipbuilders, but for all the other trades affected, from the importer of iron ore right on to the maker of steel and of all the other commodities that go to the building of a ship. That is proper and immediate help, and it is better than a great deal of the other help that the Government is to provide. I do not know whether the Chancellor of the Exchequer thinks that a case such as I have described will fall within the scope of the Bill. Not only the authority I have mentioned but many other authorities are prepared to go ahead with work if they could be assured of some help that would make the undertaking economically sound. No authority is justified in going on with work on anything but economic lines. I have had sent to me demands from all classes of people for reductions in dock dues. Therefore, far from our policy being to spend money extravagantly, we must husband our resources.
I listened the other night with great pleasure to my right hon. Friend the Member for Gorbals (Mr. G. Barnes), who stated a fact which raises much opposition when put before a popular audience. He pointed out what the Labour party argued when the 8-hour day was asked for. They said the men would be able to put out far more in a day of 8 hours than if they were compelled to work 10 or 12 hours. That argument persuaded a great many people that the 8 hours' day was a right thing. I ask what is the plain truth? Have the men put out as much in an 8 hours day as they did in a 10 hours' day? They are not even working the 8 hours and this applies to almost every branch of industry. I asked the other day, when going over a financial statement, how it was that wages seemed to have risen within the last 18 months. The explanation I got from the heads of departments was that they had had to take on a number of additional men on account of the 8 hours' day. It is a perfect farce in some cases, because the men have not the work to occupy 8 hours, and yet we have to have two sets of men doing the work which was formerly done by one set of men. That is going on all the way through. I shall give just one example of a case where the unions and the employers were able to come to terms and I do not see why other unions, if they have the goodwill, cannot do the same thing. My own particular business is shipping, and nothing has been so badly affected by the depression of the present moment as the shipping industry.
I do not know about that. What about agriculture?
Agriculture must be very bad indeed if it is any worse. It was almost impossible for us in this business to pay the current wages with all the restrictions which were put upon us during the War, but we had agreed for peace sake and in order that we might carry on. We then put our case before the National Maritime Board, which is the great body to deal with seafarers' wages, hours and conditions. At first they rather resisted our claim, then their leaders said to them, in our presence, as well as I am sure, behind our backs, "You must realise that it is a fair thing for the owners to ask some reduction in wages." It took a little time to arrive at an agreement, but we were patient, and I hope employers are always as patient. We could quite understand how unwilling the men were to give away anything they had got, but through patience and pursuasion we arranged the matter at last, excepting as regards one leader. He took his crowd with him and they went on strike, and their places were filled, and now I am quite sure they have nothing but condemnation for the bad leadership which brought them into that position.
I am only giving this example of willingness on the part of employers to meet the men and to deal with them in a proper, sensible and reasonable manner. There are black sheep in every flock, but I am quite sure my hon. Friends on the Labour Benches who are in the habit of meeting employers of labour, generally find them reasonable. Speaking individually, I think I may say that we get on very well together, and why is it when we get on so well together individually, that all this animosity and bitterness is preached from the platform? It is that horrible spirit of antagonism which is to blame for a good deal of what is happening to-day. A reference has been made to business men turning politicians. Politics are all very well in their way, but I think on this grave question of unemployment, at a time when men and women are coming to terrible misery, there should be no differences between that side of the House and this side. I do say that Government should give all the help they can, and I welcome this Bill and all these proposals, but it will depend upon us, the employers and the employed, to get the country out of its present serious condition. That position is not due to the ordinary cyclical ups and downs of trade; it is the result, as the Prime Minister has said, of the War, and we have to make sacrifices to meet it. Just as in the War we won by all pulling together, so in this we shall only succeed if we all pull together.
My hon. Friend will forgive me if I do not follow him in discussing the topics of which he is an acknowledged master, or in entering upon that controversial and difficult side of the subject with which he dealt in such an exceedingly tactful fashion. I propose to return to the calmer atmosphere in which my Friend the hon. Member for Maldon (Sir F. Flannery) made his speech, and to deal more particularly with the question of the guarantees proposed to be given by the Government upon certain conditions with the object of lessening unemployment in this country. I confess I was somewhat frightened when the Chancellor of the Exchequer told us of the very wide scope of these proposals, and of the area over which he proposed to cast his net with the object of finding schemes which he or the Committee could safely use the powers of the Government to guarantee. I was reassured when he said that a preference would be given to development in the British Empire, which, as he rightly said, provides both our best customers and our most loyal friends. That alone, apart from any business consideration, is a very good reason for giving a preference to the British Empire. It is much better to support your friends than your enemies, and, as a general rule, it is safer to let your friends use your money than your enemies.
With regard to the principle of this Bill, I am entirely in support of it. We have built up through the centuries a great Imperial credit, 'which, notwithstanding the shocks to which it has been subjected during the War, still remains with us, as a great engine for the expansion of the Empire. Up to now we have made very little use of our Imperial credit for the purpose of developing those most valuable possessions of the Crown overseas. To myself and a number of my friends who have been working at this subject for many years, in season and out of season, it seems a great pity that this step was not taken before. Had it been taken, I think it is very likely the problem of unemployment with which we are confronted to-day, would not be so serious as it undoubtedly is. It is not too late to mend our ways, and I am extremely glad that His Majesty's Government have at last been brought to the point of making these proposals to the House of Commons. In the past, money has been poured into all the other countries of the world, but very little of it has gone to those possessions of the Crown which have been directly administered by the Colonial Office. It is not very surprising because these have been for the most part rather difficult countries to deal with. It takes time to build them up, and for them to attract men who have the enterprise and the means to run great undertakings. At the same time, I entirely agree with what has been said by the Colonial Secretary outside this House, that if ÂŁ200,000,000 were employed in this way, it could be done without risk and with great benefit to the Empire.
We all know, with regard to the money which has been poured into South American Republics, for example, that although no doubt it did result in a certain amount of trade and in large purchases in this country, yet, in many cases, owing to dishonesty on the part either of individuals or Governments, the whole of the money expended has been lost, and with most disastrous results to British investors. I am tempted to wonder whether it would not be to the advantage of this country and the Empire if some slight difference were made in the Income Tax payable upon the interest on investments—say, selected investments—in the Empire, as opposed to returns on investments abroad. It need only be a small amount, but it would mark the difference, and it would show that we were interested in the development of our own Empire more than in the development of foreign countries. I do not know whether it would be feasible to carry out that suggestion, but, at any rate, I commend it to the attention of the Chancellor of the Exchequer.
It has been impressed on the House by the hon. Member for Maldon that well directed expenditure on the promotion of Empire development is probably the soundest of all forms of investment, from the point of view of security and of returns. We shall have the immediate benefit of the proceeds of the loans being spent, to a large extent in this country, and we shall also reap the benefit of the great trade which will certainly result from wise expenditure in this direction. I wish to emphasise the point that there must be wise selection and I hope the instructions—I say instructions not suggestions—given to the Committee, which it is proposed to set up with such wide powers, will be very definite. With all respect, I do not think we can implicitly rely upon the advice of Colonial governors, many of whom are very experienced men, but not in a commercial direction—civil servants, or even engineers. With all these classes, I know from my own experience, the wish is often father to the thought. It requires sound business heads to control them and to select from the recommendations made. The first point I should like to impress upon the House is that trade will flourish most when it is concerned with large populations, and it is not unnatural that large populations should tend to become established upon the richest and most fertile lands. Therefore, as there is absolutely no limit to the sums that can be spent in these directions, I should like to say that, in my judgment, first attention should be paid to works designed to promote developments in trade in well populated' regions. As the development of means of communication is always the most urgent need in new territories, and as the efficiency of every line of transport and communication necessarily depends upon its weakest link, I suggest that attention should be paid to, let us say, a bad port or a bad connecting link of railway, or something which is causing a block at a definite point on the lines of trade. A bad harbour can easily destroy the whole of the business of a good line of railway, or vice versa , and so the improvement of weak links may very well be the best and most rapid means of securing the results we want.
The Prime Minister gave us the other day the very remarkable figure that the trade of Nigeria, which fulfils the requirements I have indicated of a large popu- lation and a fertile country, with a certain equipment of railways, reached last year the sum of ÂŁ33,000,000. That country is very rich in resources, with an exceptionally virile and brainy population, and I am confident that further investments there will yield most excellent results. The party opposite, judging from their remarks in this House, though I notice the Leader of the party outside the House has given utterance to very different sentiments, seem to be afraid that development of our Colonies and Imperial possessions is going to mean emigration, and with swift thought they rush to the idea that people on this side of the House are anxious to get rid of members of the working class in this country. If I may say so, as one who has lived in a new country for a great many years of my life, I have never heard such a ridiculous notion, and the more so because I understand that the money to be guaranteed under the proposals of the Government is mostly to be expended in tropical and semi-tropical regions. At the very best the proportion of white population to the native population of these territories is generally represented by fractions, by decimals of one per cent. It is quite a large proportion if the European population gets up to 3 per cent, of the whole, so that at the most quite a small number of Europeans can be established in those regions, and as a rule those people are not just ordinary working men. They are men of exceptional energy and resource, and men who possess those qualities which enable men to make their way in a new country. If, therefore, there is any fear on the Labour Benches that the prosecution of this policy is going to mean the expatriation of working people who do not want to go, I think they can at once dismiss that fear from their minds, and I hope that the results of the policy will be to give very good opportunities for bettering themselves to a limited, picked number of the working classes of this country.
The question was raised during the course of the Chancellor of the Exchequer's speech as to how the terms and conditions on which these loans are going to be made will be established. It is possibly a Committee point, but I suggest that advantage should be taken of the Committee stage to lay down in the Bill some very specific directions to the Treasury, and through them to the Committee which will deal with these matters, upon certain very important points. I am inclined to think that action should be taken in all these matters on strictly business lines, and, apart from such enterprises as new railways and new harbours, which in these Colonies are perhaps as well, if not better, dealt with under Government control than by private enterprise, I think that any other enterprises which may be brought for guarantee would be undertaken with a better chance of success if they were undertaken by private enterprise than by Government officials. We have burnt our fingers lately in this country by ill-considered experiments in State socialism.
A result of the War.
I do not see the ex-Minister of Health in his place, but I have only to mention the first housing scheme to make it quite clear to the House that State socialism is not a real success, and I suggest that the Government should seek opportunities of giving support by way of guarantee to reputable groups of British capitalists on business lines. [HON. MEMBERS: Hear, hear!"] The hon. Members on the Benches opposite, who, I hope, are cheering my remarks, may or may not be aware that the wealth of this country in the past was built up entirely by what, in the Elizabethan days, were known as adventurers, and very useful people indeed they have been. I hope that suitably selected adventurers, that is, people with the brains and with the enterprise to carry through to a successful issue the enterprises they conceive in their brains, will be backed by the Government in future as they ought to have been in the past. That brings me to a point on which I will merely touch. I have said that I think this State support should be given on business lines, and that to my mind, as a business man, does include that they should not have something for nothing. I greatly doubt whether the mere giving of a guarantee is enough. It is a question of principle, and I think the Advisory Committee, or whatever it is to be, should take into consideration whether, in return for the business advantage given to them of raising capital cheaply, there should not be some reservation of a share of the profit to the State in case the business should ultimately prove successful. Our State revenues in this country from sources other than taxation are at present extremely small, and I believe this is one of the means by which that form of revenue can be increased, and by which the taxation of the country may be diminished. At any rate, I think that is a proper field for inquiry.
Another point I wish to raise is this. We, here to-day, are all against waste, and waste is implied if you buy expensively when you can buy cheaply. It is quite right and proper that the condition should be attached to these guarantees that the expenditure of the proceeds should, so far as practicable, take place in this country for the creation of work and the relief of unemployment, but I suggest that there must be some sort of upper limit of prices which the people who are to expend this money may have to pay, and I will give one or two figures to the House which have come before me this year in the course of a business with which I am connected. They are figures connected with a railway company in a British possession. In January last that company required to buy a certain number of railway wagons. The English price quoted was £140,000; the wagons were offered from abroad at £82,500; in other words, the English price was 70 per cent, higher. A smaller lot of wagons, for which the English price was £17,737, was 137 per cent, higher. Blocks of permanent way material involved an expenditure of about £150,000; the English price was 40 per cent, higher than the price of the same material obtained from abroad; and other requirements for permanent way showed more or less the same results. I venture to think that in every case where unduly high prices can be proved to the Committee—and remember that this must occur after the money has been found, after the guarantee has been given, and not before—that where the Committee can be shown that unduly high prices are due to any improper cause—I do not care whether it is rings of employers or trade union restrictions—but if the cause of the high prices is shown to be indefensible, then the people who obtain the money ought to be able to take advantage of cheaper prices elsewhere. I do not think the right of the people who raise the loans to buy in the cheapest market can be denied to them in those circumstances. It is not to the advantage of this country that colonial governments or enterprises should be compelled to buy at prices which cannot be justified.
I was very glad, in listening to the speech of the Chancellor of the Exchequer, to find confirmation of that view in a passage which I took down. He said that the House would agree that the guarantees must not be used to keep up prices. Unless there is some sort of elasticity allowed, of the nature I have suggested, that is exactly what the effect of these proposals might be. The right hon. Gentleman also said that the reduction of prices is the most prominent matter to keep in view. I should like to remind the House that it is the unsatisfactory industrial conditions which are now prevailing here that are causing investors in this country to prefer these colonial and protectorate loans to investments in industrial securities at home, and because that is happening, the condition has arisen in the Colonies which my hon. Friend the Member for Dumbarton (Sir W. Raeburn) has pointed out has already arisen in this country with some corporation securities. Whereas some time ago the value of an Imperial guarantee to a colony might easily have been to reduce the interest they would have to pay on money, say, from 8 per cent. to 6 per cent., to-day there is very little in it, and therefore, if the value of the guarantee from a financial point of view is not going to be considerable, it is very doubtful to what extent the Imperial Government will be justified in imposing onerous conditions upon the giving of the guarantee. I am perfectly certain that our kinsmen abroad will welcome the opportunity of reducing unemployment here, and I am sure they will be anxious to further the desire of the Government and to help distress in this country, but at the same time I suggest that they ought not to be pressed too hard, that this question should be looked at from their point of view as well as from ours, and that there should be give and take.
Although this question of Empire development is very dear to me, and I should not find it difficult to speak on it at much greater length without going over the same ground twice for a good long time, I think these are the main points I wish to bring out. I hope that some of the matters to which I have referred may be discussed at greater length in Committee, but that the principle of the Bill may be passed this evening, and that the Second Reading may be accepted by the House without a Division.
6.0 P.M.
The Chancellor of the Exchequer did well to remind the House at the commencement of his observations that this country is in a very peculiar position, and that we differ from nearly every other country in the world, inasmuch as we are compelled to import very large quantities of food and raw material. In spite of all the rhetoric, resolutions, or whatever gas may be generated, that food and that raw material have got to be paid for by the product of British manufactured goods. Therefore, I join with my right hon. Friend the Member for Peebles (Sir D. Maclean) in thinking that the Safeguarding of Industries Act, and all that kind of nonsense, could really have been left aside. The Chancellor of the Exchequer stated that the wealth that had flowed from the City of London had fructified production in all parts of the world. I would like to ask, why is it that wealth is not now flowing from the City of London to fructify production in all parts of the world?
Because it is not in the City of London.
We will come to that in a few moments. Let me make this one observation, that that wealth which has fructified the whole world has been produced and sent abroad by private enterprise. I want to know what has happened that there is no demand for British goods, or, rather, there is a demand for British goods, but it cannot be satisfied. My hon. Friend said that the money is not in the City of London. I am not so sure about that. The Chancellor of the Exchequer is making money every day at the present moment. [HON. MEMBERS dissented .] He is making paper, and we have to accept that as money. It is very illustrative of this Bill and what may flow from this Bill. I read in "The Times" this morning,
"Floating supplies of credit were as abundant as ever, and the demand for accommodation was small. One of the banks was lending night money at 1½ per cent., and balances were to be had at the close at ½ per cent."
Surely that does not show any lack of money. The Chancellor of the Exchequer yesterday was asked whether the Government proposed to advance money for the electrification of suburban portions of the trunk line leading out of London. The right hon. Gentleman replied,
"I understand that the electrification of these lines is postponed, not because the companies cannot raise money, but because present prices render the work unremunerative."—[OFFICIAL REPORT, 24th October, 1921; col. 424, Vol. 147.]
That seems to me to be a very sound statement, but will this be cured by this Bill? The whole of the Government proposals, though they are necessary in these times, are simply expedients, palliatives, and are no cure for the evil. Therefore, I want to get down to a cure, if I can. It has been stated that the Government are thoroughly imbued with the principles of economy, and that they propose to carry out ruthless, relentless economy. In fact, I think it was the most audacious part of the Prime Minister's speech the other day when he threatened the House with dire penalties if they voted against the. Government when they proposed economy. Look what we have done this Session. My hon. Friend opposite has told us that ÂŁ30,000,000 is to be spent in Glasgow or round his constituency on Dreadnoughts, and it is going to give employment to 12,000 men.
I did not say that ÂŁ30,000,000 was to be spent there. I said three ships were to be laid down.
Three ships are to be laid down there, and it will give employment to 12,000 men. I believe far more employment could be given if we could reduce taxation. You are printing money to-day; you are not paying your way. What will be the consequences? The demand for British goods is checked because British goods are dear, and the more you print your paper money, the dearer those goods will become. The Government have got to recognise, as the House and country have got to recognise, that high rates and high taxes are potent causes of unemployment. I listened to my hon. Friend on the Labour Benches the other day who said the local authorities were at the end of their tether. So they are, but is not the Government at the end of its tether, too? To imagine that the Government has an inexhaustible store of revenue to pour forth to a hungry world is, to my mind, quite beside the mark. I believe that if the Government to-day proposed further taxation it would result in a decrease of revenue. The Government to-day is not paying its way. It is creating paper money, and it is aggravating the very disease from which we are suffering.
The credit which is represented by paper money is not greater than it was six months ago. On the whole, the inflation or the credit created by the Government is less to-day than it was six months ago.
I am sorry to differ from so eminent an authority. If the Government is not inflating, how comes it that money is so cheap in the City of London? At any rate, I am quite certain that the Government is not going to balance its Budget this year. If it does not balance its Budget, when it pays out large sums of money, it is going to inflate, in spite of the financial pundit on my left. We have been told that this Bill will enable the British traders to deal with countries which have acrobatic exchanges. Again, I doubt that. I do not believe that you can deal with these countries at the present moment where the exchange is jumping up and down. One of the great necessities of the world to-day is peace, and this attempt in Austria of the ex-Emperor to go and upset things again is one of the very worst things that can happen for trade. I hope the Government will take into account that these ex-monarchs are in close contiguity to their former dominions. It has been stated that the indemnity which is to be paid by Germany is killing trade. Well, Germany has not paid any indemnity yet. [An HON. MEMBER: "Coal and ships."] We were told on Tuesday by the Financial Secretary to the Treasury that Germany had not paid any indemnity. [An HON. MEMBER: "It is wrong."] I suppose I should really say, any reparation. They have paid for the cost of the Army of Occupation. I do not really want to get into an argument; I want to get at facts. But when we are told that we must wipe out all international debts, I want the Government to realise that we owe America about ÂŁ1,000,000,000, and America is not willing to wipe it out. Therefore, before being generous in the matter of debts owing to us, we must think about America.
I want to get back to the root causes of unemployment. I would ask, is not one of the causes of unemployment to-day dear coal? Coal is a vital motive power, which propels all the machinery which gives employment to millions of our people. We have a new Mines Department. We were able to be told last year what was the price of coal. I asked the Mines Department how the price of coal delivered in works compared to-day with pre-War prices. They cannot tell me. Therefore, I am inclined to think that the Mines Department, and many other Government Departments, could very well be dispensed with, because if they cannot give information, they certainly cannot do any business. How far does dear coal cause that increase in price which checks the demand for British goods? I want the Government really to consider whether it would not be advisable for them to appoint a small commission of enquiry to find out what really is checking British trade. How far are railway rates to-day checking British trade? I have a very shrewd suspicion that they are hampering trade to a tremendous extent. I do not believe the trade of the country can stand these rates. That is' a cause of unemployment. Then, does anyone believe that the 2d. post is not hampering trade? Then we are told that trade union restrictions are hampering production. If it be so, let us know. I believe an inquiry into this matter would do good. I would have an inquiry with open doors. Let the world know. Public opinion is the greatest solvent in these matters, and if trade unionists, by their regulations, are restricting production, let us know. I cannot think that any fair-minded man would dissent from that. Then, with regard to trade disputes, how far have they caused unemployment? I think we should know these things. I really want to get at the root causes of unemployment. These so-called remedies of the Government are simply plasters on an ulcer. The ulcer is there, and it is not cut out. Let us try to cut it out. I would suggest to the Government, with very great respect and earnestness, that they should appoint a Commission, or a Committee, to inquire into the root causes of unemployment. If we can get at the real causes of unemploy- ment, whether it is dear coal, or railway rates, or postage, or trade union restrictions, or trade disputes, I am convinced that if we can get at the facts the British public will face them. But until we get at the facts we must go on in the old style of doles and subsidies which really aggravate the disease from which we are suffering.
I was very glad to hear from the Chancellor of the Exchequer that he is going to appoint a Committee to administer the funds which will be raised under this Bill. I ventured to ask him during his speech where the provisions relating to the appointment of this Committee appeared in the Bill. I have studied the Bill carefully, and I see nothing in it which compels the Government to appoint the Committee which he has outlined. Probably in the Committee stage—
The right hon. Baronet was probably absent from the House for a little while, but my right hon. Friend the Chancellor of the Exchequer gave an undertaking that he would introduce in Committee a provision to the end required.
I was out of the House for a few moments, and I am very glad to hear what my hon. Friend says. I trust that the Amendment when it is put forward will be unanimously passed. I have heard what the right hon. Gentleman opposite has said as to the real causes of unemployment. We have also had a statement from the Chancellor of the Exchequer as to why there is bad trade at the present moment. In my opinion there are two reasons why trade is bad at the present moment. The first is because it is impossible to produce an article at a price which will give you a profit if you try to sell it, and trade cannot be good unless you can produce articles at such a price that they can be bought by the people abroad. Therefore, so long as we cannot produce at a price which will bring customers abroad trade will be bad. None of these Bills, none of these palliatives, will alter that. That must remain. All these Bills will only accentuate that and perhaps make the position worse than it is now.
Why has that position arisen? Partly from the fact that the War left us a poorer country. As everybody knows, before the War our National Debt was, in round figures, about ÂŁ650,000,000. After the War our National Debt was ÂŁ8,000,000,000. What did the Government do in face of these facts? It went into a campaign in the country. I brought up to London yesterday, but I forgot to bring it here to-day, a paper called "The Future" issued in September, 1919. There was a picture of the Prime Minister on the front page. In "The Future" it was stated that the Government could not possibly allow the state of things which existed before the War to continue. They were going to have a far and away better state. There was to be a new world in which everybody would live in a charming house and pay very little rent for it, and wages were to be very high. What happened? On various occasions when in various places I was asked to give my advice on matters of this sort, when I ventured to remonstrate with this idea, I was met with the reply: "Oh, but we have entered into a new phase in this country; everybody is going to get a good deal more, and none of the working classes will be asked to live in the same manner as before. The standard of life is going to be improved." It was impossible. If it had been possible no one would have been more delighted than I. The Government encouraged this idea. The vast majority of people, unfortunately, do not always think as clearly as they ought to do, and they trust to the people who ought to lead them, and it is owing to that that to a very great extent the cost of production is so high.
I want to make a suggestion—I am coming to the Bill in a moment. Two new steps might be taken by the Government if they really wish to improve trade. The first is to repeal the Trade Disputes Act. The second is to abolish Trade Boards. [An HON. MEMBER: "And boards of directors!"] Well, that is my opinion. If these things were done the common sense of both the workmen and the employers would lead to such a condition of affairs that we might again produce at a price at which we could sell; as soon as we can do that the exchanges will be righted and employment will be, again rife in this country. The next thing to do is to reduce taxation. I read in the "Times" a few days ago—and I am sorry I did not bring that with me either—an extract from a letter written by the late American Ambassador, Mr. Page, to some American friend—in New York, I think it was. In that letter Mr. Page said, "I have been very much struck by the prosperity of this country"—that is, England. "I cannot understand why it has been so prosperous, because our workmen and our business men are as good as the English workman and the English business man. I have come to the conclusion that the reason England has been so prosperous is that for the last 700 years she has been saving money, and the people have added to their capital, which we, as a new country, have not been able to do." Then Mr. Page said to his friend that "If in the years to come we in the States save money and increase our capital we shall do better than England, because our working men and business men are as good: we shall not be handi capped by lack of capital, and capital has been one of the causes of the prosperity of England." I believe that to be perfectly true. It was written, I think, five or six years ago, and written by a man who had no political feeling in the matter. I venture to commend it to the Government and to the Members of this House as being worthy of consideration.
I, therefore, say that one of the most important matters is to reduce taxation, and to reduce the death duties, because we are living on our capital at the present time. The death duties are dreadful. When a man leaves something to his successor that capital instead of going to the successor and so being increased as in the past, as Mr. Page said, goes to the Government to be spent on the expenditure of the year. If that is continued no Bill of this sort will do anything to alleviate the position which we all desire to alleviate. I am rather surprised that in this Bill we are going to lend money to foreign countries. Why on earth, if we are going to depart from our old principle of individualism—which I maintain has been the cause of the prosperity of this Empire—not lend that money, as my hon. Friend the Member for Tamworth suggested, to our own friends and not to our enemies. It would be a very good thing if the Government remembered that principle in other matters. If, I say, we are going to do anything of this sort let us lend our money to our friends and to the Colonies.
I am not, however, always quite certain that we shall be sure of getting it back again, and that aspect of the case seems to me, if I may say so, not to have presented itself to the mind of the right hon. Gentleman the Chancellor of the Exchequer. He said at the conclusion of his speech: if this turns out to be successful we can next Session extend it. But we shall not know next Session whether or not it has turned out successful. We shall not know for some time. Two things are required to make it successful. One is that it stimulates employment, and it will take some little time to find that out, and the other thing is getting the money back again. We cannot be certain of this in such a short time. If we are going to lend money to private individuals—and I rather think that my hon. Friends of the Labour party opposite will agree with me here—I do not believe the State should lend money to capitalists—the State ought not to interfere—but if we are going to do this, what a horrible position the Committee will be in. Unfortunately at the present moment there are a great number of firms who are in very low water. These are the sort of people who want money. What are the Committee going to do in cases like this? How are the Committee going to distinguish? It will be a very invidious task. If we are not very careful we are going to lend the money to all these various firms who unfortunately, owing to the great depression in prices of recent times, find that their credit is not so good as it was. We may find that we have landed ourselves in a very unfortunate position. The adventures of the Government in lending money to companies up to the present has not been very successful. I think there is a company called the Cellulose Company; therefore I wish to sound a note of warning to the Government in this direction.
Is it not the case in the Bill that the money is only guaranteed: the Government does not lend the money?
What is the difference? You guarantee the capital and the interest, and I do not see any difference; for what the Bill really does in a way is to increase our capital indebtedness. Our indebtedness is increased whether we really borrow ourselves or guarantee the money to somebody else. What we ought to do is to endeavour to decrease our national indebtedness, and not to increase it. A matter was raised by the hon. Member for South Molton (Mr. Lambert), and I should like to say a word or two on it. Are the Government at the present moment increasing the paper currency or not? I do not know. I have not looked it up. My fear is that the Government are increasing it, that as their debt to the bank increases they are increasing the paper currency. If they are it is a very dangerous thing to do.
Now I come to the other part of the Bill which deals with overseas credits. Here again the Government are going into business. I do not know what the firm will be, whether its title will be George, Mond, Horne and Company, or some name of that sort, but they are going into business as an accepting house. Anyone in the City knows perfectly well what an accepting house is. No better description of its business could have been given than was given by the Chancellor of the Exchequer when he described what was going to take place under the Overseas Credits scheme. They are going to accept a year's bill, so far as I can make out, upon the whole amount of money which is to be paid by the importer. If the bill is not met at the end of the year they have recourse to the exporters to the extent of 57½ per cent., and they have to find the balance of 42½ per cent. It may be good business, but my experience of the City has always taught me that the business of an accepting house is a very dangerous one. It is very profitable when everything goes well, but if things go badly it is not profitable; and I am very sorry that the Government, with all their commitments, are going into this particular business. After all, it has not been very successful from the point of view of stopping unemployment, because only £3,000,000 so far has been advanced. I do not believe it will have any very great effect, but it is setting a dangerous example. We are all anxious to meet this sad phase of unemployment. Instead of taking the bull by the horns and telling the country the truth, we are endeavouring by Government credit to tide over a few bad months. We have tried that for the past five or six months, and when that was proposed and the Chancellor of the Exchequer stated that his nest egg would be sufficient to pay for unemployment, I said it would not be sufficient and that has turned out to be right. I believe that these measures will do very little to meet the case.
Perhaps the hon. Member for Dumbarton (Sir W. Raeburn) will find some measure of satisfaction in my statement that the Labour party have decided to give general support to the Second Reading of this Bill. But, lest his expectations should be cast on too high a level, I hasten to say that the right is reserved for the purpose of submitting any Amendments which may be considered desirable at a later stage of the Bill. I join with those who say that it is very desirable at the present time that we should find out the causes of our present difficulty, and if we are unable absolutely to remedy those difficulties, at least we should do something in the direction of mitigating them.
The expressions of opinion which have been given in this House during this Debate from one or two quarters have been very striking. The hon. Member for Stratford (Mr. Lyle), in his speech last night, said the reason we had bad trade is that British goods are too dear. We had it from the hon. Member for Mossley (Mr. A. Hopkinson) that we cannot make an effective demand for commodities at the present prices. These two opinions have been effectively reinforced by several speeches, and notably a reference by the Chancellor of the Exchequer himself in support of that position. The House, I think, will readily agree that the country has been going through a period of inflated prices, and one of the dangers of the situation and one of the causes of unemployment is that the reduction in prices both in the home and in the foreign market has not been sufficiently great to render trade that assistance which it requires.
One of the chief causes of the inflation of prices is notorious. In almost every industry in the country we have been made acquainted with the procedure of writing up capital and the issue of bonus shares, and in various directions the industries of the country have their activities based to-day on a much higher capital than at the expiration of the War. I know a factory in my own locality which about a year ago had a working capital of between ÂŁ250,000 and ÂŁ500,000, and since then there has beer a re-arrangement of the capital of that firm and it is now put down at ÂŁ800,000. It is the same factory and there has been no extension. The same number of people are employed. The output of the concern has not been materially altered nor has its capacity for output. The result must inevitably be that higher prices have to be secured to pay increased dividends on the increased capital. That illustration serves to put the point of view which I desire to present. That is symbolical of the industrial and commercial position in all parts of the country. Industries with increased capital have now to make larger profits in order to pay larger dividends.
These companies with increased capital are not only not paying any dividends, but they are getting into the Bankruptcy Court.
Now that there is a reduction in the demand for their goods the penalty for the inflation of prices is being shown. What I desire to establish is that one of the causes of unemployment in this country has been this inflation of capital during the past few years since the Armistice. The prices of commodities in the home and foreign markets carry upon them the hall-mark of that inflation. I will endeavour to prove my point with three illustrations from three of our staple industries. First I will take the iron and steel trade. The Prime Minister intimated the other day that the greatest volume or percentage of unemployment was to be found in the metal trades of the country, and I think he said that no less than 17 per cent, of those unemployed were to be found in that industry. In 1913 the exports of iron and steel manufactures from this country amounted to nearly 5,000,000 tons and its value f.o.b. was ÂŁ55,000,000, or an average of about ÂŁ11 per ton. In 1920 the exports of iron and steel manufactures from this country amounted to 3,250,000 tons, and yet the value f.o.b. was ÂŁ128,000,000, or an average of ÂŁ40 per ton. It was ÂŁ11 per ton in 1913 and ÂŁ40 per ton in 1920. While recognising certain influences which have undoubtedly been at work which would make a considerable increase in the price, and after due recognition has been given to those factors, I think ÂŁ40 a ton in 1920 was an exorbitant price. It was not an economic price but a monopoly price. Can we wonder that at the present time orders are being given out for iron and steel products to Belgium, Germany and elsewhere? It is the inflation of capital in the iron and steel industries which has put the price of the articles out of the reach of the foreign purchaser.
Surely there must be more inflation in Germany than anywhere else in the world?
I desire to refer to another industry which has already been mentioned.
What product of the steel or iron industry costs ÂŁ40 a ton?
I have here the annual statement of trade for the United Kingdom with foreign countries for 1920 issued by the Government this year, and it gives the volume of goods exported and the total price and, by a simple sum of arithmetic, it works out at ÂŁ40 a ton. That is my authority. My facts relating to these particular industries are all taken from the volume in question. The coal trade has already been mentioned. The figures are available in respect of the export price of coal. The Minister of Mines, addressing this House sometime ago, made the statement that during seven years of war, for the period ending the 31st of March this year, ÂŁ40,000,000 have been taken from the profits in the coal trade and have been added to the capital of the undertakings. That, once more, is reflected in the price of the article in the home and foreign market. In 1913 we exported 73,000,000 tons of coal from this country, and the price f.o.b. was ÂŁ50,000,000 and worked out at 14s. per ton. Last year, in 1920, we only exported 24,000,000 tons of coal, but the price f.o.b. was nearly ÂŁ100,000,000, and it worked out at ÂŁ4 per ton. That is to say, the price was 14s. per ton in 1913 and ÂŁ4 per ton in 1920. Can we wonder why American coal is at this moment finding its way into Scandinavian countries which were previously supplied by this country? Even large contracts for American coal have been made in Italy, which is one of our Allies. A well-known trade paper states that American coal is finding its way even within the four corners of France and into other allied countries.
If by the inflation of capital in the coal trade and the high prices we have to charge in order to maintain profits that have to be secured we put that coal out of the reach of the foreign purchaser, under these circumstances I do not think we should complain when there is a lack of that trade in our own country. The fact that our exports last year were only about one-third of our exports in 1913 affords another illustration in this connection. The cotton trade is responsible for over a quarter of our total export trade, and anything which adversely affects that industry and exportation of those products demands our serious attention. At the beginning of this year the annual meeting was being held of the Amalgamated Cotton Mills Trust, and at that meeting Lord Fairfax said that the price of raw cotton in Liverpool was well below the actual cost of growing and transporting it to this country. Under these circumstances, they could not have anything to complain about so far as price was concerned. His Lordship went on to say: present time, and in the Scandinavian countries and the general European countries, there is a tremendous fall in the purchases of cotton goods which used to be exported from this country? Take the question of cotton yarns exported from this country to be made into cloth. In 1913 the exports were 210,000,000 lbs., and the price f.o.b. was £15,000,000, or nearly Is. 6d. per 1b. weight. In 1920 the export was 147,000,000 lbs., the price was £47,000,000, and the average 6s. 6d. per 1b.—1s. 6d. in 1913, 6s. 6d. roughly in 1920! Here is the reason for the falling off in our export trade. Alongside that fact of the falling off of the demand for the products of Lancashire there has been a reduction in the number of looms and spindles in that county. In April this year the number of spindles in Lancashire had been reduced by 26,000, as compared with the year before, and the number of looms by over 7,000. I believe the fact is that in 1890 there were two cotton mills in China. Last year there were 69. Is it to be wondered at that the cotton trade which has been recognised as having its seat in Lancashire, is now exporting textile machinery to other parts of the globe and planting the Lancashire cotton trade in other parts of the world? Meanwhile the exports to foreign countries are falling off as a result of the inflation of capital in that particular industry.
These instances are not isolated, and if any Member of the House cares to go through the volume from which I have cited the facts relating to iron, steel, coal and cotton, it will be seen that they apply very largely to almost every other industry in the country, and a simple sum of arithmetic will work out similar results to those I have quoted. That is not the end of the story. In addition to the prices, f.o.b., of these particular articles, it is a notorious fact that during the same period the charges for carrying these products to foreign countries have increased to a similar or even a greater extent, and when, added to the cost, f.o.b., we get an extra charge for freight imposed on our export trade, we there have, in my judgment, irrefutable evidence why our articles have been put beyond the reach of foreign consumers. I join in inquiring of the Chancellor of the Exchequer whether this export credit is going to be applied to prop up these fictitious prices and to seek to maintain the inflation of capital in these particular industries. These prices are not economic prices or just prices. They are monopoly prices which the purchasers are unable to pay.
A similar condition of things obtains in respect of our home markets, it is a truism to say there never has been a trade depression in our time where the prices in the home market have responded as little to the depressed purchasing power of the community at home. Wages have gone down, but prices have not gone down proportionately. The right hon. Member for Miles Platting (Mr. Clynes) the other night pointed out that 6,700,000 workers had suffered a reduction in wages of ÂŁ3,800,000 per week. There is a reduction which has taken effect. Has it assisted in any way the upward tendency of trade? What have we on the other side? We had from Members of the House last night tirades against our trade unions, accompanied by criticisms of the Labour party. These things do not help us. They may read well in the papers. There are a few hundred people in London who to-night will probably expend as much on a visit to a theatre as it takes to maintain a working man and his family for a week. No doubt the criticisms of the trade union movement will make comfortable reading for that class of people, but it breaks no ice. It does no good. It brings no advantage in any direction whatsoever. The fact remains that industry at the present time is overweighted; it is financially top-heavy, and so long as it remains in that condition we shall have these continual oscillations between seeking a reduction of wages and seeking assistance from the Treasury. While this inflation is permitted to continue, that condition of things will prevail. The over-capitalisation of industry at the present time is as great an injury to the trade of the country as the inflated currencies of the world, which are a disturbing factor to the world's exchanges.
I do not think that this ÂŁ25,000,000 will do a great deal of good. It may afford some satisfaction, but after all it is very insignificant. Our export trade amounts to ÂŁ1,500,000,000. If you throw the whole of this ÂŁ25,000,000 into that trade as a credit, it will be but a mere drop in the ocean. It has no comparison really with the volume of our export trade. We have had many appeals from various parts of the House for co-operation and mutual goodwill, for us to go hand-in-hand, but while you have the present condition of an over-capitalised industry producing the evils I have indicated, with the best will in the world we cannot possibly go hand-in-hand with what is essentially the plundering of the people. The conditions of industry in this country are an absolute menace to the State. I believe that this ÂŁ25,000,000 is nothing but a pill applied to a cancerous growth. It may relieve the pain, but the pain will come again and it will continue to be in existence until the time has come when we realise that industry must be conducted not so much for the advantage of a few small sections of the people, but as a medium for the service of the entire community.
There seems to be a good deal of difference of opinion, both inside this House and outside, with regard to the proposed operation of the Bill. I propose to deal with it from the point of view of a commercial man. I say the principle underlying it is absolutely wrong. It is absolutely wrong for the Government to step in and interfere with operations which have been carried on hitherto through the commercial community. The first part of the Bill deals with the question of making advances to different countries or Governments for the purpose of inducing employment. What I fail to see is this. We have upon us at the moment the burden of unemployment. How, in these circumstances, can this Bill deal with that burden in the next six months? Advances are to be made to companies for railway construction and to industrial companies in this country or in other countries in order to create new industries or to extend existing industries. I fail to see how that is going to help the immediate position of the unemployed in this country, or how it is going to help working men in the near future. The Bill lays it down that the Government may advance sums up to ÂŁ25,000,000, or may guarantee loans to that amount, during the coming 12 months, and then it goes on to say that the Treasury must at the end of every quarter lay on the Table of both Houses of Parliament an account of the moneys advanced and the people to whom the advances have been made, or on whose behalf the guarantees have been given.
7.0 P.M.
The position brought about by that is that various companies who are in want of money—and there are hundreds of them—will go to the Committee which is to be established by the Treasury and bring forward their plans for the extension of their businesses or, as in the case of railway companies, for renewals and upkeep expenses, knowing as they do that the financial position of the country is such that they cannot possibly get the money in the open market. They will go to the Treasury and it will be the function of this Committee to decide which companies or which firms or which individuals are to be favoured with the money which the Government have at their disposal or which they can guarantee. That cannot possibly have its effect on the labour market within the next winter, at any rate. Even the commencement of any benefit which you are going to give for the purposes of unemployment cannot take place, because all these people have got to get out schemes. Supposing that a railway company—I do not want to mention any names—supposing that a tube railway of London say, "We are going to extend the tubes or to increase them." The first thing they have to do is to enter into a contract with the contractors and get out estimates. These contractors will have to get their machinery for putting down the shafts, and for drilling tunnels and other things on to the spot, and that will take an enormous amount of time. During the whole of that period the unemployment difficulty will be with us.
I hope when we come to next summer that there will be some revival in trade, but I cannot see that these proposals for the finding of capital for these enterprises can bring immediate relief, especially in regard to speculative enterprises. Relief can be given, as was mentioned the other day by the Secretary of the Board of Trade. He said we might help some of the Indian or Colonial railways in regard to their rolling stock and locomotives. That might in the industrial centres commence to give work in the engineering trade. You can give immediate relief if you confine your assistance to rolling stock or rails and things which can be immediately got on with by the industries in those centres. One hon. Member mentioned the question of harbours in the Colonies. Such work can only very slightly assist in relief of unemployment. If you go in for harbour works the necessary machinery required is very small. The bulk of the work for harbour construction is labour, and the labour that you would have to employ if you went to the Colonies would be Colonial labour. That is not going to help our unemployed in this country. Therefore, whichever way you look at it, unless the greatest care is exercised by the Treasury, we shall find that our obligations are increased.
Naturally, I presume that the Treasury would not make advances to insolvent people or to companies which were not perhaps capable of repaying the money. The hon. Baronet the Member for Brain-tree (Sir F. Flannery) mentioned that the liability of the Government would be only £1,500,000. That is, of course, provided that the companies to which the Government made the advances were solvent, and that they could pay back the loans that were made. According to the Bill the Government gives an unconditional guarantee. The consequence would be that those companies with the unconditional guarantee of the Government for repayment of the capital and interest would undoubtedly be able to float loans on the market, but that would not be for many years to come. I do not know the period of years—there is no mention in this Bill of any limit to the guarantee, but they must not guarantee after 12 months—but if they are going to borrow, say, for 6 years, then—I do not care who borrowed the money—I defy anybody in the conditions at present existing to pay it back in 6 years' time. Then the Government would undoubtedly have to renew the guarantee or find the money to fulfil their obligation which they had taken under that guarantee. The proposal of these loans is purely political, and is simply brought forward for the purpose of pretending to do something to relieve unemployment.
The next proposal in the Bill is for the extension of the overseas credits. I opposed this last year when it was proposed in the House, and I think the reasons for which I did so then are, from a commercial point of view and from the financial standpoint, to-day absolutely sound. I stated in the House last year that any solvent firm could get credit for the shipping of merchandise or manufactured goods to almost any part of the world, provided that the people with whom they were trading were also solvent. One hon. Member said that he had a friend who had applied to a bank—he mentioned the name of the bank—to negotiate his drafts on India, because he was undertaking the shipment of goods and the extension of credit to India, and that a bill was refused. Being interested in commerce I took the trouble to inquire into the case, and it is not fair for any hon. Member to stand up here and state a part of the case. If he does so he is liable to mislead the House, and he may go to the Government with the same statement, and that may be one of the reasons for the extension of these credits. The reason the bill of the firm was refused was this. The bank made inquiries and found that the firm was quite a respectable one, and gave them a certain definite credit by which they could ship goods to India and draw against it. The first bill drawn was for £800, and that was succeeded by several others. When the bill for £800 matured, however, the people on whom it was drawn failed to pay, and the people who drew it asked the bank to give them more time. The consequence was that when the drawers of the bill went to the bank and asked for a further credit to negotiate new bills on the same firm, the bank necessarily refused, as any solvent commercial firm would. The hon. Member in question has no doubt told the Government that his friend has found it difficult to negotiate his bills.
The position of trade at the present time is very unsatisfactory indeed in every part of the world. We have to realise that owing to the War the whole world community is reduced in circumstances. They have not the money to spend that they had before the War. No matter to what country you go, the position is the same. There is a scarcity of money, notwithstanding the reports of the banks, which shows enormous deposits. No one, owing to heavy taxation, is in the position to spend the money now that he could before the War. The consequence is that the consumption of every article has had to be reduced. Another point which has been raised by several speakers is that those commodities have risen enormously in price in the meantime. Therefore, no matter what article you take, you find that people who were in the habit of buying before the War are not to-day in the position to purchase the quantity that they did in pre-War times or even during the War, because the unemployment everywhere, except perhaps in Central Europe, is as great as it is in this country. Take the case of a pair of boots which are sent to Australia. Before the War the Australian would buy two pairs, or perhaps three, but to-day he has to be satisfied with one, because he is not making the money he was before the War. That state of things prevails in every part of the world. The hon. Member for Dumbarton (Sir W. Raeburn) mentioned the fact that he had had nearly 50 years of business experience. I can claim a longer term of business experience. I have had 51 years this month in active business life, and I am still as active as ever. I recollect that I went into business in the time of the Franco-German War in 1870. I remember perfectly well that we had a period of great prosperity immediately after that war, which was followed by a, time of very great depression. It was not as serious as the depression from which we are suffering at the present moment, because the war in those days was confined to the two countries, whereas to-day it has been a universal war.
If we look at the position of the markets in nearly every part of the world—South America, India, China, Japan, Australia, or wherever you go—it is an extraordinary fact that, where we thought that the markets were going to be depleted of stocks after the War, in nearly every case there is a sufficient stock to carry on and to supply the needs of the people of the country. As to where these things came from we must not forget that during the War America was doing an enormous trade, as was also Japan in supplying a lot of the markets in South America, China, and India. Those commodities have not been consumed. When the War was ended there was an enormous rush for stocks in this country. Everybody thought it would be a very good business to buy up those stocks and ship them out to the different markets. They did so, but the markets did not respond, and a great deal of the stocks which were sent out remain in those markets unsold. The consequence is that the merchants have large stocks on hand on which they have taken advances from the banks. These stocks cost them very much higher prices than they could be bought at at the present time.
The Government to-day propose in this Export Bill that the Government should go to the assistance—very rightly—of the manufacturer. They propose that they should assist the manufacturers to ship the stocks of goods which they now have made, and which, owing to the circumstances which I have tried to explain, they are unable to sell at the present time. The Government say they will arrange to guarantee the buyers to whom the goods are sent, if they can be sold, and the result will be that many manufacturers, wanting to get rid of goods which they have had in stock, will consign those goods, whether sold or unsold, to firms in different parts of the world, and we shall have a continuance of the depression which at present exists. I know from experience that, when you get stock in a market and the buyers know that you have a large quantity of goods unsold, they will not come forward to make you bids, but will wait until you are absolutely sick, and then, when you are willing to sacrifice the goods at almost any price in order to get rid of them, and the banks are pressing, they will, perhaps, take some of them off your hands. This proposal of the Government to give these credits is going, in my opinion, to retard the revival of trade altogether. Inquiries are coming forward from different parts of the world for different goods at the present time. The position, probably, will take six or twelve months to clear up, when we might see a revival of trade; but the miserable £25,000,000 which the Government propose to keep for the export trade is not sufficient to pay for the exports of this country for one month. The result will be simply to create the stagnation which everyone at the present time is hoping may be done away with, so that trade may be revived. I do not think for a moment that the credit which the Government propose to give can possibly do anything to revive trade, or even to assist in any way in bringing about employment in this country. It may relieve the banks who have made advances to merchants and manufacturers and who are anxious to get paid. If the manufacturers can ship the goods to their buyers abroad, and can, with the Government guarantee, discount the bills, no doubt they will want to get all the credit they can from the accepting houses, and by that means, of course, the banks will get a certain amount of relief in regard to the advances they have made.
I do not want to go outside the Bill, but a question was raised by the hon. Member for Spen Valley (Mr. Myers), whose statements, I feel, I must answer to a small extent. The hon. Member mentioned the fact that the writing up of capital had to a great extent inflated the value of the goods manufactured. Anyone who knows anything of commerce or industry must know that the capital cost of a factory has nothing whatever to do with the cost of production. It very often happens, as any industrial will be able to tell you, that the manufacturer cannot pay any interest on his capital. I believe that at the present time there are a great many industries that are paying no dividends at all. With regard to the cotton industry, everyone who knows anything about finance knows what has taken place in the cotton spinning machinery business. A group of ambitious adventurers had an idea that the cotton industry was very prosperous, and that the prosperity was bound to last for ever; but very clever men have often made mistakes before. They went round to the different mills and got options, and bought a lot of mills at fabulous prices. The people who owned those mills were very glad to get out at such prices. These gentlemen who bought the mills immediately set to work to float new companies with this enormously in creased capital which the hon. Member for Spen Valley was so emphatic in condemning. But the manufacturers—the actual business men, the industrials—had nothing whatever to do with it. It was purely a Stock Exchange gamble on the part of a lot of adventurers, and there is not the least doubt that those gentlemen who have enhanced the value of these mills, and those unfortunate people who were induced by the glamour of the profits that had been made to pay these exorbitant prices for their shares, will lose the bulk of their money before very long. I might tell hon. Members opposite that it does not mean, because an industrial concern is over-capitalised, that it is going to pay dividends in accordance with the capital. Over and over again shareholders investing in different industries and undertakings have not only lost the whole of their interest but the whole of their capital in the long run. You must, therefore, separate entirely the Stock Exchange from industry in these respects. I have nothing to say against the Stock Exchange, and, as a matter of fact, the men who went into this speculation were not members of the Stock Exchange at all, but simply company promoters.
With regard to the question of iron and steel I am not going to say anything, because I have not the figures before me, and without them it is impossible to discuss the question of prices. Another question, however, was raised, namely, that of the carriage of cotton goods. The hon. Member went into the question of exports of cotton yarn, etc., and mentioned that in 1920 there were enormously increased charges for carriage. The only increase in charges for carriage was the increase by the railway companies, and that increase was thoroughly justified, because the railway companies had to pay much higher wages to their men, their men worked shorter hours, and they had to pay a much higher price for coal. When you come to the question of shipping, the charges for carriage by sea in 1920 had fallen enormously. The freight on cotton goods had come down, I suppose, about 70 per cent, as compared with the rates charged during the War. Therefore, that had nothing to do with the selling price of the goods in foreign markets. The only conclusion one can come to in reference to unemployment—which, although it does not form part of this Bill, has been referred to by several speakers in this Debate—is that the only remedy is to bring down the cost of the articles which we produce to the level of the means of the people in the markets that we have to supply. None of these measures of loan or export credits will sell your goods unless you can produce them at a price at which the markets can absorb them in competition with other markets. I will not say that it is absolutely necessary to reduce wages in order to reduce the price, but, as has been said so often to-night, if you want to reduce the price you must receive good wages, but you must give a good, hard, honest day's work for them.
The House will congratulate the hon. Member who has just spoken, on the fact that he has been 51 years in business. I do not know whether it is a matter for rejoicing or otherwise, but I have been in business for 55 years, and I have had considerable experience in many commercial matters. I have also had experience of many depressions, some of them even more severe than the present, and they have all passed away; and I am sufficiently optimistic to believe that this depression also will pass away. I agree, however, with the hon. Member that nothing in this Bill is going to do away with the depression. It will relieve, possibly, to a certain extent, certain people, but the position in which it puts us is, in a nutshell, this: We are to go to our customers, who tell us that what we want to sell to them is too dear, and we are to say, under this Bill, that we cannot reduce the price, but we are going to give them longer credit. It strikes me that that is what the Bill means, and I cannot see that it is going to help us very much. We all know the reason for the difficulty in selling our goods. It is that the cost of production is too high. There are various reasons for that. Possibly it may be that in many cases wages are too high, but I assure the hon. Member for Spen Valley that it is not because the manufacturer is adding too much profit to the price at the present time. He is quite willing to sell his products at cost price, or below cost price, to keep his factory going and pay his standing charges and his staff wages, and, possibly, the interest upon his overdraft at the bank.
Notwithstanding what the hon. Member for Spen Valley says, I plead for a closer co-operation between capital and labour. I believe, and I do not think it can be contradicted, that if there were just a little of the policy of give-and-take with the trade unions at the present time, then, notwithstanding the depression, the trade of this country could absorb practically the whole of the unskilled labour. Let me give my reasons for saying that. In a newspaper this morning—the Newcastle "Daily Chronicle"—there is a reference to wages in the city which I have the honour to represent. I am speaking of unskilled labour, which at the present time in many cases is more expensive and higher paid than skilled labour. That ought not to be the case, but it is. A representative of the newspaper paid a visit to one of the big firms connected with shipping, and asked to see their books in regard to the cost of labour. He took promiscuously the wages of 24 unskilled labourers, and he found that five of them for the quarter, that is to say, 12 weeks—ending on the 5th October, had received from £102 to £104 each, for four days' work in the week.
What were they doing?
They would be lifting cargo out of the hold of the ship, putting cargo into the hold of the ship, wheeling it from the ship on to the quay and piling it upon the quay.
Payment by results?
ÂŁ102 to ÂŁ104 for twelve weeks. Eight of them received ÂŁ90 to ÂŁ100. [ Interruption .] I assure hon. Members these are matters that I understand, and you can read them in the newspapers. You may say it is unfair to take a quarter. Let us take twelve months. Nine men received each ÂŁ307 to ÂŁ338 for twelve months work at four days a week. The bulk of the men received ÂŁ228 to ÂŁ300. Many men are receiving 12s. 6d. an hour, and notwithstanding that, we have processions of unemployed in Newcastle, and we have speeches at unemployed demonstrations pointing out how the people are starving and cannot get a job while others are receiving their 12s. 6d. an hour. This very day I asked to see the books of a firm similarly situated. The cashier said, "Yes, I will show you the figures. I will show you the returns we are giving to the Income Tax authorities." Therefore you may take it that these figures are quite correct. For the quarter just ended many of these men received ÂŁ65 to ÂŁ75. About ÂŁ5 to ÂŁ6 per week was the average for four days' work. By a little give-and-take on the part of the trade unions they might say, "We will relax our rules, and instead of these men getting ÂŁ8 or ÂŁ9 a week let us double the number of men upon the jobs and let them all have ÂŁ3 or ÂŁ4 a week." Surely that would be very much better than giving them relief work or doles. Wherever I go, in the docks or in London, on the quays or into the Manchester district, or to the Associated Chamber of Commerce at Sheffield, I am told that one of the principal reasons why manufacturers cannot produce cheaply is the cost of coal. I quite agree that it is so. I know that the wages of the miners have been reduced, and probably will be further reduced, but I would give a word of advice to the leaders of the miners. Only last year we passed an Act reducing the coal miners' hours of work from eight to seven, and we put in the Bill that if it turned out, as was expected, that as many or more coals would be turned out than was the case in the longer hours the seven hours would automatically be decreased to six hours. But we did not put in the Bill, as we ought to have done, that if it was found that the prognostications about the increase produced were wrong we should revert to the eight hours. That is what we ought to do now. Let me tell the House how it will work out. I will give figures I got from a colliery of which I have been for some considerable time the chairman. Our manager tells me that while the eight hours were in existence the output per man per shift was 17.2 cwts., but since the seven hours were put in force we only get 11.9 cwts. Could you have more eloquent figures in favour of asking the coal miners' leaders for a short time, as an experiment, for nine months or six months, to try what is going to be the effect of reverting to eight hours?
Is it not a fact that the actual coal getters in the hon. Member's area only worked seven hours and not eight even before that Act came into operation?
That may or may not be, but the effect of the reduction of the hours was a reduction of the output.
On a point of Order. May I ask if it is relevant on the Second Reading of this Bill, which deals with export credits and loans, to deal with the question of hours of labour in the coal mines and the payment of unskilled labourers? Is not that a continuation of last week's Debate and ought not the discussion to-day to be more or less relevant to the question of export credits and overseas trade and loans?
I think an hon. Member who believes this Bill will do little or no good is entitled to put forward his view of what are the real causes and his own view of the remedy.
The fact that the hon. and gallant Gentleman has attempted to stop me, I think, proves that the figures I have given are unpalatable to him and to others. But they are facts. The reason for bringing this Bill in is to try to find employment for men who cannot be employed legitimately at present, and I think I am entitled to put before the House my reasons for thinking that one of the reasons why there is this unemployment is the high cost of production. I have no wish to reduce wages; I would rather see increased production. I have endeavoured since the War to find employment for large numbers of men. I have spent a very large amount of money, together with my partner, in laying out a great shipyard, a most up-to-date shipyard, and when we finished it the slump came. We cannot sell the ships at the price they cost us to build. It is no use beating round the bush. That is the plain English of the matter, and there is nothing in this Bill that is going to reduce the cost of production. I think the Bill is probably necessary, and I shall vote for it because I think the Government is bound to do something, but I should like to have seen something done by the Government in the direction of a reduction of the cost of production. The Prime Minister told us a night or two ago that there is very little difference between relief work and doles. Neither there is. If we put men upon relief work we take any sort of man who is out of employment, whether he is suitable for the job or not. If you let a contractor carry out the work, he picks his men, and takes good care he only gets men suitable for the job. But no council and no corporation can do that. They have to find work for men who are out of employment. The sooner we get rid of that the better, and I welcomed the remarks of the hon. Member (Mr. Wilson-Fox), that if we are going to spend this money, let us, as far as possible, spend it in our own Colonies and Dependencies. All my political life I have been in favour of preferential trading with our Colonies and Dependencies and I think that is one of the best suggestions made by the Minister for the Colonies. It is a sensible suggestion. As far as possible in regard to these schemes, let the Government divert trade to the Colonies. I should like to ask the Chancellor of the Ex- chequer this one point in regard to Clause 1, where it says, "If the Treasury are satisfied that the proceeds of any loan proposed to be raised, whether within or without the United Kingdom, by any Government, any public authority, or any corporation or other body of persons." Will that apply to private firms and limited liability companies, or simply to public bodies?
It would apply also to private firms.
That is a very important fact which has been much debated. I took the trouble to write to the secretary of our Newcastle Chamber of Commerce a day or two ago, and had a reply this morning. I am not surprised to find that they are in Newcastle of my opinion that this Bill is going to do very little to decrease the cost of production or to get trade back into its legitimate channels. Therefore, I trust the Chancellor of the Exchequer will, as quickly as possible, do everything he can to avoid the necessity for any further Bills of a similar description.
I have been listening to these Debates rather having a particular problem in mind, and wondering how it was going to be settled than being able to concentrate my mind closely on the particular Government proposal, and some of these Debates in the last few days I have only read because I have a feeling that all this House can do will not amount perhaps to all we can hope, and some of us who are in a position to do so will be able to do more by individually setting people to work in our own locality than by taking part in the proceedings here. As the first fruits of what, to some extent, comes within the Government policy, I welcomed, at 8 o'clock yesterday morning, 30 unemployed men from Tiverton who actually came out and began to cut down scrub and wood in some woodland area that I happened to be able to put at their disposal for selling as firewood. It seemed to me that it was better to have contributed to that practical solution of the difficulty than to have perhaps bored the House with my remarks on the Bills we have hitherto been considering. So far as, I have been able to read or listen to the Debates, I have had in my mind the practical problem presented by districts where really the bottom has fallen out of the local industry, such as the tin mining industry in Cornwall. I do not know whether it is intended under this Bill, and if so how, to deal with a problem of that kind. I am afraid it is not isolated. I wish it was in a way. I am, afraid there must be other districts where practically the chief local industry has come to an end, and there is very small prospect of its revival.
This Bill talks about capital undertakings by public authorities, and I should like to know whether it is the intention of the Government to help really terribly and distressed districts under these phrases by helping local authorities—either the existing local authorities in the narrow sense or special authorities which may be set up under this Bill—or, if not, how otherwise they will come under the general combination of schemes which the Government is putting before the House. You have the practical failure of the tin mining industry. The figures are perfectly appalling. In Camborne, the chief centre of distress, no fewer than 78 per cent, of the ratepayers are themselves in receipt of unemployment donation, and they have for the last few months been out of benefit altogether. Under the Government scheme I suppose they will come into benefit for some few months, but it is quite impossible to ask this 78 per cent, of ratepayers to help by any scheme of paying rates to provide the money for the relief of themselves in their capacity of persons out of employment. I should like to know whether it is suggested that they should come under this Bill and that a local authority, if they can put forward certain works, or any combination of local authorities which may undertake work on a larger scale, will get really adequate assistance from the Government.
I will answer that point at once. I think in the county to which my right hon. Friend refers help towards local authority schemes would come under the other provision which the Government has made, under which they pay half the interest of the sinking fund for five years in the case of reproductive work, and 65 per cent, of the interest on the sinking fund for a period of not more than 15 years in the case of non-productive work.
I was afraid that was the answer. When you have to deal with a local authority which has practically got to the end of its tether, so far as raising money from the ratepayers is concerned, and when eight out of ten of these people are themselves in receipt of unemployment benefit, and the remainder of the ratepayers are, to a large measure, simply the tin mines, it is obvious that to say to authorities of that kind that you will only help them by paying a certain proportion of the interest on their loans, or a certain proportion of the currency of those loans, leaving the main burden of raising the loan and paying interest on the loan to the authority itself is really no answer at all to the position. I was afraid that that was the position, and that they would come more or less under Circular 245, namely, that they would be helped for a certain part of the currency of the payment of the loan and a certain proportion of the repayment of principal and interest. These authorities have reviewed the position very carefully, and they say that to offer to pay half the interest of the loan for half the period of the loan, leaving three quarters of the burden to be faced by the ratepayers, is no good to a district, eight out of every ten of whose ratepayers are permanently out of employment. Therefore, I ask the Government to realise that it is not sufficient.
It may be said that they may be helped to some extent by the emigration scheme; but the answer to that is, that all the young men who could emigrate have emigrated, and that the distress is among the older men who, at their time of life, and with their family ties, cannot emigrate. It may be said that they may get relief under the Ministry of Agriculture scheme for land drainage and forestry. The district is not suitable, either for land drainage or for forestry, because it is too wind swept. To some extent work could be given on the roads, but that, I think, is already being done, and, in any case, it only touches the fringe of the question. There are far more people out of employment than could possibly be taken>an by road schemes. The Government come forward' and say, that if a local authority of that kind will first of all raise a loan, which they cannot do, and will pay three quarters of the interest on the loan, they will—
I must deprecate this line of argument, which relates more to the Bill which is set down for Friday. We must try to conserve our time as far as we can. We are dealing with finance and exchange in foreign trade rather than with local authorities.
I considered that, and after reading the Bill that is down for Friday and seeing that the schemes of relief for local authorities there are strictly confined to allowing them temporarily to borrow on condition that they can repay the sums borrowed within the same year, and realising that that would be no sort of use for meeting this problem at all, I thought that my only chance of getting the position fairly stated was on this Bill, which, at any rate, does say that public authorities may be helped in their capital undertakings. I will not pursue the point. So far as help to districts of this kind is concerned, there is nothing in the Government programme as so far stated, or in the Bill that we shall consider on Friday, which is limited strictly to temporary borrowings to be repaid in a year, and cannot meet the case at all. I should like to know whether it is contemplated under this Bill that big schemes which cannot be undertaken by one particular borough council or rural or urban council will be covered. For instance, there is the scheme projected in Cornwall, of making a large harbour of refuge at St. Ives which would be available for ships coming from southerly and westerly directions. Is it contemplated that that sort of undertaking will be included? Such a scheme, presumably, would have to be undertaken either by the Government itself in the same sort of way as a dockyard, or something of that kind, is undertaken, or it would have to be undertaken by some union of local authorities or some body specially formed for that purpose, because it is quite clear that the rural or urban council in itself could not handle an enormous undertaking such as the construction of a big harbour of refuge. My right hon. Friend has intervened by saying that this Bill is not intended for local authorities. I am afraid that the Bill set down for Friday will not meet the case, and I should like to know what part of the Government's scheme will meet the case with which the Chancellor of the Exchequer is fully acquainted. Am I right in thinking that if a union of authorities in Cornwall, or a union of authorities and public men, put forward a big scheme for a harbour of refuge at St. Ives, that it would come under the terms of the Bill?
If the local authority had a scheme which they proposed to carry out, and for which they were prepared to issue a loan, and if the scheme was approved as one which was going to provide employment it would be considered by the Committee, and if the Committee approved it the result would be that they would get the Government guarantee. The first obligation, of course, for the repayment of the loan would lie upon the local authority putting it forward. Of course, the Committee would not pass the scheme if it was going to be assumed by the local authority that really the Government guarantee was going to mean the payment by the Government of the loan.
Of course, a harbour of refuge is an additional insurance to shipping coming from certain directions, but you cannot make a charge upon every ship that takes refuge in your harbour. It is a thing of general utility and value to the commerce of the United Kingdom coming from our southern and western seas. I am afraid I must take it from what my right hon. Friend has said that, so far as the Government is at present advised, there is no prospect of a big work of that kind being undertaken unless the authority, undertaking it have a scheme of repayment, which under this harbour of refuge scheme they cannot possibly have, because you cannot rate your shipping flying for refuge from the storm. At this stage I cannot see that this Bill or by any other means the Government intend to meet the extraordinarily disastrous condition of the Cornish tip mining industry. We must, therefore, trouble them further, and pursue such opportunities as we get. I hope the Government will not feel that because the Cornish men have been extraordinarily patient so far that their position is not very critical. They are men who are accustomed to live on very little and to endure in silence for a very long time, but they have got to rock-bottom now, and I am afraid that the position will not be sensibly relieved so far as I can understand it at present by any of the various well-intentioned schemes put forward by the Government.
The hon. Member for Central Newcastle (Sir G. Renwick) said that he had been in business for 56 years, and another hon. Member opposite said he had been in business for 51 years. One proposed to vote against the Bill and the other proposed to support it. As an ordinary layman, I feel inclined on the question of length of time, seeing that one has 56 years against 51 years experience, to support the Bill. But that is not the real reason why I propose to support the Bill. I support the Bill because I believe the Government is making a sincere and earnest effort to cope with this difficulty of unemployment within the limited means at their disposal. The Bill is divided into two parts—the export credits scheme and the guarantee in regard to loans to the extent of £25,000,000. The Chancellor of the Exchequer has already agreed that the export credits scheme in its original condition has not met with very much success. He attributed that to dilatory methods. Those dilatory methods meant a great many rules and regulations and red tape which surrounded the scheme. I am glad to hear that these are to be largely dissipated, and that the amount to he covered to the trader has been increased from 85 to 100 per cent. Therefore, the risk being very much less, the trader is likely to enter into business with much greater heartiness. But we shall have to go further than this export credits scheme if we are going to do anything towards stabilising the exchanges in Europe.
8.0 P.M.
This scheme is a very small matter involving only ÂŁ26,000,000, while overhanging Europe to-day are War debts amounting to ÂŁ1,787,000,000, apart from relief debts, which amount to another ÂŁ180,000,000. When it is suggested therefore that it is possible by means of this Bill to have any appreciable effect upon the exchanges of Europe, I say it is an impossibility. Of the ÂŁ1,787,000,000, ÂŁ562,000,000 was lent to Russia. I think we can put that out of account. That leaves ÂŁ1,225,000,000. During the period of the War in which America was fighting with us America lent to us the sum of ÂŁ876,000,000, and during that time ÂŁ897,000,000 was lent to foreign nations. We are all aware that America regards the proposal to cancel these two debts mutually as one which she is not prepared to agree to, and, indeed, from all I can hear from my American friends, it is a proposal which is very unpopular in America. I "wish to make another suggestion which might be considered by our Government and the American Government for getting over this difficulty. 1 cannot think that in the long run America who, like ourselves, to-day is in an extraordinary position of economic difficulty with several millions of unemployed, and who is seeking to trade outside her own borders, will be able altogether to overlook this question of the War debts which hang over Europe. Now after deducting the Russian debts ÂŁ1,225,000,000 remain. I propose that this country should accept responsibility for half that amount, ÂŁ612,500,000, and that America should accept responsibility for the other half.
With our half I propose that we should go forward generously, though with a certain amount of self-interest, and say, "We are going to cancel this £612,500,000. You, America, can do what you like with your £612,500,000, but if you accept that solution, we will cancel our £612,500,000, and to that extent relieve the enormous load of debt which overhangs the whole of Europe to-day." An hon. Member opposite said a few days ago that this was not a business proposition. I suggest that, when a business firm has a debtor who is in difficulties, the best thing that firm can do, and very often does, is to help the debtor to get on his feet again by writing off sometimes the whole of his debt or at any rate part of it. A point which was overlooked by the Chancellor of the Exchequer, when stating the chief reasons for unemployment to-day, was over-taxation. The whole country is crying out for a reduction of taxation. Several hon. Members have to-day referred to this question of over-taxation and have pointed out how closely allied over-taxation is to unemployment in this country. In fact, the heavy taxation is choking all industry in this country to-day. The right hon. Baronet the Member for the City of London (Sir F. Banbury) has said that already we have a capital levy owing to death duties. The capital levy which hon. Members on the benches opposite a year or two ago were urging day in and day out, is already being imposed on this country not only by death duties, but by means of Super-tax— Super-tax which many people, who have to pay it, paid last year out of capital, and will pay to a greater extent out of capital next year, while in the following year I expect it will be wiped out altogether as there will Be nothing left with which to pay it.
That capital levy through Super-tax is going on to-day in this country and is diverting capital which ought to be put back into industry and preventing it from becoming reproductive. [HON. MEMBERS: "Where is it going?"] It is going to pay off debts, and that brings me to another point. I believe that the Government, while they were actuated by the best motives, were not right when they decided two years ago that we should commence paying off our capital debts from the very day after the War ended. I would ask the Government to consider whether we ought not now to delay for two or three years the repayment of our capital debts until industry and the country get upon a better basis. Another suggestion which I should make to the Treasury is this. When you examine the Civil Service Estimates of revenue and expenditure in this country it strikes one who has ever had anything to do with Estimates—and I have had a certain amount to do with Estimates for a number of years in a small way in the Colonies preparing Budgets—that the way those Estimates are framed lays too big a burden upon the present generation. In other words—
I thought that the hon. Gentleman was going to speak about Empire development, but the form in which Civil Service Estimates are prepared has nothing to do with the Bill which is before us.
I was leading up to Empire development, and was referring to the heavy taxation in its relation to the form of Civil Service Estimates.
I observe that the hon. Member's "leading up" takes a quarter of an hour. The form of the Civil Service Estimates has nothing to do with the Measure which is before us.
After the Napoleonic wars this country was in very much the same condition economically as it is today, and special measures had to be taken in order to relieve unemployment, just as they have to be taken to-day. Part of those measures was the total abolition of Income Tax. I do not know how that appeals to hon. Members on the Labour Benches, but it actually did happen in 1816. There were many other measures which were continued for a number of years, but one very important measure was the State-aided scheme of emigration under which the Treasury devoted at one time £50,000 at another time £30,000—different amounts in different years—in order to relieve unemployment in this country. At that time the solid foundation of the Empire was laid by that means. To-day the same economic conditions prevail, but unemployment is a great deal worse. To-day we have the opportunity of building higher and stronger upon the foundations that were laid at that time.
The right hon. Gentleman the Member for Platting (Mr. Clynes), in his speech a few days ago, said that he had no prejudice against emigration as such. Then he went on to refer to conditions which should be arranged for that emigration, and he further suggested that if workmen were to be asked to emigrate, they should be asked to take part in the supervision and conduct of the emigration arrangements. I have the greatest sympathy with those remarks. I remember that, in 1908 in Canada, when emigrants were pouring over from this country, they only helped in many instances to add to the population of the slums which already existed in the cities there, and—I have travelled on emigrant ships myself—there is a great deal in what the right hon. Gentleman suggested, that to some extent this emigration in the past had been a traffic in human beings. So far therefore as labour advising in the supervision of emigration schemes is concerned, I am with him, and I hope that the Government will adopt his suggestion in that respect. Coming to the Bill itself, £25,000,000 is provided to relieve unemployment by assisting capital enterprise, and this side of the scheme, it appears to me, might be made very much stronger, not only by guaranteeing, but by providing that in the case of any scheme which finds favour with the Advisory Committee and the Treasury, the Treasury may authorise payment as well.
The reason why I make this suggestion is this. When the Conference on State-aided Empire settlement was sitting, Senator Millen, the Australian representative, pointed out that conditions in Australia—and I assume that the same exist in other Dominions—have reached a point where unemployment is commencing, and it is very difficult to receive any more emigrants on the ordinary assisted basis. I have here a report which has been published and I will read one paragraph to show what his suggestion was, for I think the suggestion is very helpful and I wish to press it upon the Government. The paragraph is as follows: problem in this country. I wish to say something also as to the Crown Colony loans of £20,000,000 which the Secretary of State for the Colonies has arranged. I congratulate the right hon. Gentleman upon his plan. It is obvious that as this £20,000,000 is not to be guaranteed by the Imperial Government, it is all to be raised by Colonies like Nigeria, the Gold Coast, Kenya Colony and others, which through their financial position are able to go into the open market in London and obtain the money. What about those Colonies which are not able to go into the markets and obtain loans in that way? We have many small Colonies which are just as much in need of development in their smaller way as are the larger Colonies. I would impress upon the Government that in allocating the £25,000,000 under this Rill they should take particular account of the needs of these smaller Colonies. I welcome more than I can tell the statement of the Chancellor of the Exchequer that it is the intention of the Government to do what it can to promote trade between different parts of the Empire.
I am rather sorry I was not called upon to speak earlier, for I was really after the scalp of the hon. Member for Central Newcastle (Sir G. Renwick), and unfortunately for the moment he is not in the House. I will venture to deal with certain subjects touched on by him, because I think there should be a reply to him. The hon. Member referred particularly to the fact that a certain number of men in the City of Newcastle, presumably at the docks, were earning extraordinary wages, running in one instance, he said, to 12s. 6d. an hour. Then the hon. Member pointed out that that was the effect of trade union rules. As a matter of fact, it has nothing whatever to do with trade union rules, because it is an understanding between the employers of the port and the union of the workmen. I know much about dock working, and I know that at times a dock workman will continue at work for 24 hours, or in rare instances even for 48 hours round the clock. It is true that for the three or four days such men are able to work their pay is fairly high, but they are not able to do any work for the next week, and in some cases it is a couple of weeks before they can get another job. On the average I do not think that the Income Tax collector will get much out of the dock workers' wages.
A great deal has been said in this Debate about the necessity of reducing the cost of production. It is stated that our goods cost so much that we cannot sell them in the markets of the world. Hon. Members on the Labour Benches will appreciate what I say when I state that, while we are in favour of a reduction of the cost of production, it cannot be done by reducing wages. For the last three or four months I have been one of a negotiating committee in the engineering and shipbuilding trade. The employers in that industry will not say that we have been obstinate in considering their claims for a reduction of wages. Only this year we gave them 6s. per week per man. Now we are considering the question of giving another 10s. I suggest that the giving of 16s. a week per man for 2,500,000 men in that trade is a very considerable contribution towards a reduction of the cost of production. I do not think we have even touched the fringe of the question. By the mere fact of giving that, we reduce the possibilities of the home market, and so are working within a vicious circle.
The fundamental fact which we have got to get deep into our mind is that there is no possibility of any remedy for unemployment under the present commercial and industrial system. I am not blaming the employers when I say that. I am blaming nobody. I say the evil is in herent in the system itself, and the sooner we get that into our minds the less we shall tamper with these petty parochial palliatives. These may be good enough in their own way, but they do not vitally affect the problem we are dealing with It is well known that in the 1906 Parliament attempts were made by the party to which I have the honour to belong to persuade the Government never to tackle this in any panicky frame of mind. We pointed out, over and over again, that these occasions must arise, and that they would be driven by the force of public opinion, by the necessity of circumstances, by the sufferings of the people involved, to take steps when in a frame of mind which is not conducive either to the drafting of proper measures or to the consideration of proposals which might be effectively employed in the long run. We always said the Government ought to have a scheme on the stocks, of an elastic character if you like, to use when unemployment loomed, as it will repeatedly loom under the present system, and put that scheme into operation when required. When trade became normal again men could be taken away from such a special scheme and put into the factories at their own work again. I suggest that is the common-sense way of looking at this problem. I came down to the House with the intention of voting against this Bill, but I have been converted since listening to the Debate by reason of the fact that both financiers and employers have been against the Bill. I have looked carefully through it, and I think there is a measure of credit to be given to the Government for the Bill, and so I am going to vote for it, although, as I say, I do not think it will effect much good in dealing with the whole question.
There are one or two things in connection with it, I want to know more about and I hope the Financial Secretary to the Treasury will take a note of them. I am much disturbed by the fear that in the disbursement of this ÂŁ25,000,000 all will go to the large concerns, and the smaller men will not get a look-in. Regard should be had to the fact, that even under present conditions it is largely the small men who struggle most severely and who really try to keep their concerns going. The personal relations between the smaller man and his workmen are of a much better character than those existing between the workmen and the great trading concerns. It seems to me that if a business is not of sufficient magnitude, it cannot put in its claim for a grant out of this pool of ÂŁ25,000,000, because that money is to be for large, capital works. I hope in the course of the Committee stage, the Government will seek to amend the Bill in that respect. With regard to the credit schemes, it has already been pointed out that you cannot expect to get back your foreign markets even by a system of credits. A stabilising or steadying of the exchanges is necessary and as the bon. Member for Miles Platting (Mr. Clynes) suggested at the opening of these discussions, we ought to sit down and consider how the Treaty of Versailles works out in this direction. You have this ÂŁ25,000,000 proposal, you have your export credit scheme and you are to have a further Bill as to grants or afforestation and so, on. You have in all four Bills and yet, as I have said, they will scarcely touch the fringe of the question while this great outstanding fact of the exchanges remains to be dealt with. There are three great obstacles in the way of trade flowing between us and our foreign market. These are the Treaty of Versailles, the Reparations Act and the Safeguarding of Industries Act. I was speaking to a German the other day in Amsterdam on the question of exchanges and he was lamenting the fact that the mark had come to 750. I told him how I thought, and how the Labour party thought, these things might be rectified. We talked about trading by the old primitive method of barter and he said:
Of the various expedients which the Government have taken to meet the present difficulty, this Bill strikes me as being the most helpful and the least dangerous, and I say that for two reasons. First of all, although all the other Measures which the Government have brought forward this week are based on considerations of humanity, and, therefore, of expediency, they are all economically unsound, and we know they are, but this Bill is not necessarily economically unsound. It may, in fact, be productive of real and positive good to the commercial community, and that without imposing any burden upon the classes which are not directly affected by the provisions of the Bill. That is one reason why I think this Bill ought to be welcomed. The second reason is that, of all the Measures which the Government have brought forward during the last two days, this is the only one which is conducive to the prosperity of the export trade, and, so far as this Bill relates to credits and insurance, it is calculated to increase the amount of goods shipped by this country overseas, and there is nothing which is more helpful to the country at the present time than an increase of exports. It is only by increasing exports that we can pay for raw materials from overseas and for our food supplies from overseas, and that we can further strengthen the bonds which bind the different parts of the British Empire together. This appeals to me particularly as one of the Members for Manchester, because the greatness of Manchester, as of other great industrial centres in this country, depends on the well-being of its overseas trade, and when Lancashire is prosperous the rest of England is also prosperous.
The present system of overseas credits which this Bill is intended to amplify has been criticised to-day as having been a failure, because only ÂŁ3,000,000 out of the ÂŁ26,000,000 voted by way of credit have, in fact, been used, but that small use of the existing system is not due to any lack of enterprise on the part of our merchants or manufacturers; it is due simply to the fact that the countries scheduled in the original Bill are countries with whom it is dangerous to entertain commerce. Among those scheduled countries you have States like Georgia and Armenia, and the reason why export trade has not been encouraged with those countries is simply because trading with them involves bad risks, and it is not worth while for a shipper to trade with a country where the risks are so bad, nor is it safe for the State to guarantee any account with communities of that kind. In dealing with overseas credits, the exporter has to act as a prudent man, and he cannot afford to take long risks. That is a good thing, because we do not want to see rash speculation under cover of this measure. Moreover, it is the duty of the State to act as a prudent underwriter, and not as a speculative backer of hazardous adventures, and in this connection I shall be interested to learn what percentage the Government will charge for the various guarantees which it is going to give under this Bill. The real change from the existing system brought about by the Bill is that the area of these export credits is extended from countries in which we have no confidence to countries where we can trade with more confidence in the bills being met and the goods being paid for. I disagree with the suggestion made by the right hon. Baronet the Member for the City of London (Sir F. Banbury), when he said that the operation of this Bill ought to be limited to "our friends," meaning by that our fellow citizens in the British Empire, because when you come to trade it is our customers who are our friends, and if this Bill can stimulate trade with any overseas market, the Bill is worth having and that trade is worth stimulating.
The Bill has been a good deal criticised as not providing a cure for unemployment. The right hon. Member for South Molton (Mr. Lambert) waxed very eloquent on the shortcomings of the Bill in not providing a root and branch cure for unemployment, and he suggested that all sorts of inquiries should be set up as to what the underlying causes of unemployment are. Of course, we cannot cure unemployment by Acts of Parliament at all. What we are doing is to provide an immediate palliative for bad times, and if it does palliate those bad times to any appreciable extent the palliative is well worth having. This Bill does not, of course, go to the root causes of the present hard times. It does not deal with such problems as the lack of purchasing power among our customers, which is the real main cause of the present shortage in the flow of British goods to overseas markets; nor does it touch the other great cause of unemployment, namely, high costs of production. I suppose that the only way to tackle the high costs of production is to take heroic remedies, such as repealing the Trade Disputes Act, but a Coalition government is slow in seeking heroic remedies, and, failing that, we have to take what we can get, and this is distinctly better than nothing. I do not attach the very great value that some hon. Members have attached to this business committee which is to be set up to run the system which the Bill is intended to provide. We have heard a great deal during the last few years of the wonderful powers of business experts and supermen as members of committees which are going to govern where Parlia- ment and where the permanent civil servants fall short, but the man in the street has not got such a very high view of these business experts on these committees, because very often their expert knowledge is limited to their own particular trade, and they are no wiser on any other trade than is the man in the street; nor does the country as a whole believe in this superman who, entering upon a committee, is able to arbitrate where Parliament and where the Board of Trade say they personally are not going to arbitrate. The superman very often has a voice of brass and feet of clay. He is no use when it comes to practical purposes. I hope this committee, when it is set up, will take a wide view of the present needs of the country.
We do not want to export machinery primarily to overseas markets. It is much more important to export textiles, because the more machinery you export to overseas markets the more competitors you help to strengthen in that great competition between our textile trades and foreign trades. We want to see a larger proportion of manufactured goods in the nature of textiles sent out from this country to other markets. If the hon. Member for Spen Valley (Mr. Myers) were here, I should like to challenge some of the amazing observations which he made with regard to the Lancashire cotton trade. Some of those arguments have already been dealt with, but I should like to emphasise this point, that however much capital is watered in these cotton concerns, if you are not in fact paying dividends upon that capital you cannot regard that capital as a standing overhead charge on the industry at the present time. The real cause for the troubles in the cotton industry to-day is that the cost of production is so high that the foreign customers cannot afford to pay for the goods. That brings me to the main point I should like to make, and that is with regard to the position of Lancashire cotton goods which are at the present time in India, which had been shipped there before this Bill was brought in. To this point it is most desirable that the Government's attention should be drawn. From a Lancashire point of view, the key of commercial prosperity lies in India. It does not lie at the present time in the impoverished countries of Central Europe. The ports of India are simply blocked with manufactured goods sent there from Lancashire in pursuance of orders received from India at a time when cotton stood at a very much higher value than at the present time. In most cases they were firm contracts binding on the Indian importer, and in consequence of the fall in the value of the rupee and the sinister political propaganda going on in India those goods have not been taken up. The fall in the value of the India currency has had a terrible effect on Lancashire, and you have to correlate it with the effect of the boycott by the Swadeshi movement in India run by Mr. Gandhi. In any country except our country Mr. Gandhi would have been hanged long ago. It is toleration of that kind which makes this Empire what it is. During the War we talked a lot about self-determination. It was very useful indeed, as a solvent in fighting against the Central Powers. Unfortunately, the war cry of one year becomes the folly of the next, and we are now paying all over the world, particularly in India, for having preached that doctrine in times of emergency. The result is that we are up against this boycott in India, in addition to which there is the fall in the rupee.
Until that position is rectified, there is no hope of making the cotton position in Lancashire what it was a few years ago. What happens is that you have this huge block of goods rejected, not because of any breach of conditions in the contract, but simply arising out of circumstances in India. Owing to the enormous amount of capital locked up in these goods, less capital is available for other purposes of production, and not only have you capital locked up, but you have credit which is given to these merchants and importers by the banks extended to the furthest possible limit, so that until these goods are released the firms which own the goods can get no further credit, and have no capital available to increase production. What I am hoping the Government may see their way to do is to extend Clause 2 of the Bill, at the end of Sub-section (1), so that the export transactions, for which these facilities are given, will include transactions in respect of goods exported from the United Kingdom before the passing of this Bill, but not yet accepted or paid for by the buyer. If facilities of that sort are given to the Lancashire exporter, on to whose shoulders these goods have been flung back in consequence of the political and economic conditions of India at the present time, it will be giving, I feel convinced, a real benefit to the struggling trade in Lancashire. As I said before, when Lancashire is prosperous England is prosperous, and I hope that if the policy which I have indicated is embodied in an Amendment in Committee, the Government may see their way to accept it, or so to extend the original provisions of the Bill that that very great grievance of Lancashire is redressed, and the cotton industry in Lancashire may be again placed upon the firmest possible foundations.
The last time I had the opportunity of addressing the House was shortly after the Prime Minister had made his speech a week ago concerning the several Bills and Money Resolutions that have been and will be before the House. I took advantage then of that opportunity to ventilate what I considered at that time was an Irish grievance. It was the exclusion of Ireland from the operation of the unemployment benefit. Since then the Government have had their eyes opened, evidently, to the unfairness of the exclusion of Ireland, and have come to the conclusion that the only and proper thing to do is that the workpeople unemployed in Ireland should have the same advantage as the workpeople unemployed in England. I am glad that the Government have seen their way to grant it. It is not a privilege. I appealed to the Government then as a right, and they acknowledged that right. So far as that particular point is concerned to-night in the Bill before the House, I have not that grievance. The words in the Bill before the House, repeated again and again, are words that an Ulsterman is always prepared to receive with pleasure. Those words are "the United Kingdom." It may be there are sordid minds who will suggest that we like to hear those words, as on an occasion like this, because it may give an anticipation of some financial benefit. I hope it is the case with regard to this Bill. At all events, from the beginning to the end of the Bill we see the words "United Kingdom." But we are specially penalised in Ireland at the present moment, and I would like a lenient view to be taken when it comes to utilising the Bill with regard to public authorities or traders, as the case may be. In reply to a question, the Chief Secretary for Ireland said that the claims, which the inhabitants had to pay for damage done recently amounted to some ÂŁ8,000,000, and that the local authorities in certain parts of Ireland were deprived of at least ÂŁ1,500,000 in grants, which they would ordinarily receive, because they were not acting in concert with the Government of the day. The result of all that is that Ireland financially is discredited to a certain extent. Therefore we have these difficulties to fight in the application of both the first and second portions of this Bill. In the first instance there is a sum of ÂŁ25,000,000 allotted to traders. Traders are penalised because they are living in Ireland. I fear very much that they will be considerably penalised when the application of the second portion of the Bill comes to be applied to them. I suppose all this is necessarily so on account of the state of Ireland at the moment. But there are certain local authorities in Ireland who have not been touched in any way by what has gone on. There are some places that have not a window broken and have not a slate off.
On a point of Order. Has what the hon. Member is saying anything to do with the Bill now before us?
The hon. Gentleman is entitled to show that the credit of Ireland has suffered on account of the state of affairs there. He will not be in order in dilating upon that state of affairs.
9.0 P.M.
That is exactly what I am trying to do. I have not the slightest intention of anticipating some, of the speeches and the points that may be put before the House very shortly in regard to the Government of Ireland. I do, however, want to press upon the House the necessity, in whatever Committees may be appointed, of dealing leniently with Ireland because of the position in which she finds herself. The first part of the Bill refers to the local authorities undertaking certain work. I wish to put before the House the difficulties of the local authorities. One difficulty is this: because of the position in Ireland at the present moment they cannot get advances from the bank that they could have got 10 years ago, although there are towns untouched by any of the recent happenings. I think, therefore, it is right that the Government in bringing in this Bill should have particular regard to cases of that kind, for these local authorities are prepared to go on with the work and are, under the circumstances, precluded from doing so. Another reason why we have lost credit there, and may be hindered from taking complete benefit from this Bill, is the distances we are from the sources of supply of the raw material. The question of coal has been mentioned as one of the reasons why the cost of production has so largely increased. Take my own place, 20 miles from the City of Belfast. The carriage costs 9s. per ton and this adds to the cost of production. We are penalised to that extent. I should like some information—though it is very difficult to get information here—in regard to the possibility of these various schemes. The Prime Minister, in his very elaborate statement, referred to the various schemes consecutively, and I put some questions to him, and I venture to put them now, one or two having reference to this particular Bill. There is the question of work of great public utility, and I have wondered whether such work would come under the head of a capital undertaking. Take a work which would pay itself, and repay the money expended. A question in which the six counties now interested in the Northern Parliament would benefit is the drainage of that part of the country lying along the banks of the Bann whereby you would release anything from 30,000 to 40,000 acres of the best land in the United Kingdom. If these six county councils unite and appoint a central body to look after this question, would the Government consider a request from that central body on the lines I suggest in order to have this work carried out? If need be I will put this question again when we come to the £10,000,000 grants. Again, a local authority may desire to electrically light its district. I presume a public authority 'could undertake that? Would it come under the head of a capital undertaking or not?
In regard to the second part of the Bill, naturally we all in our own districts wonder what advantage this particular portion of the Bill will be to that district or that part of the country. One hon. Member representing the cotton industry dealt with it from that standpoint. Naturally I have in mind the particular industry represented in my part of the United Kingdom. I was particularly struck with the speech of the hon. Member for Central Cardiff (Mr. Gould) the other night in which he gave the reasons why it was absolutely necessary to introduce legislation of this character. In the course of his speech he said: Minister's speech are email traders who have been brought down to the verge of bankruptcy because of the money taken from them under the Excess Profits Duty. These are just the men who will not be assisted to any degree by this Bill, because there will be a selection made by this Committee.
Who are the Members of this Selection Committee going to be? Take the case of any hon. Member of this House engaged in any particular business. Is he going to submit his accounts to business men engaged in the same business as himself? Are they going to give him credit? I fear very much that the Government authorities, in dealing with this question, have relied too much upon the information and advice given them by banks and banking institutions. As far as I can see the banking concerns have given this advice to the Government, because they want to save their own skins. At any rate, that is my opinion. The overdrafts that have been given to these traders, and the money that has been taken from them by the Excess Profits Duty has left them with only their high-priced stocks. This is the class of trader to which this Committee will say, "You are to be limited in the export of goods at your disposal, and you will be limited also in regard to the countries to which you can send your goods." When this Committee sees the position of any particular trade whose resources have been depleted by the Excess Profits Duty and other causes, are they going to permit that trader to send his goods to a country like Austria? He will be limited to certain countries. I doubt very much, considering the entire situation and the position of traders here, whether this particular palliative is going to be of the slightest use to the trade between this country and foreign countries.
The cost of production has been so frequently referred to that I do not want to do anything but briefly allude to it. It is a very difficult and thorny question, but what I do say with regard to that situation is that traders generally in this country have the hard facts with regard to overdrafts from banks before them, and how can the Government help those particular concerns? This Bill will not help them, and will help the man who does not want help. This scheme is going to help the solvent man. The Government are responsible for the position of trade and they will have to deal with it. If the Government take the right measures they will say to the bankers, "Just have a little more patience with these traders. Trade will surely come right again, because it is only a cycle of depression that comes to every country, just as surely as the sun will shine to-morrow so surely will trade come right again." It may be that we shall have to wait some time, but these palliatives are not of the slightest use. This measure, of course, cannot do much harm, and it may do some little good. At all events I do not think that the Government has grasped the subject as they ought to have done. I do not think they have realised the position of the trade of the country. They have not boldly looked into the question, and they are not dealing with it in a bold manner. Unemployment benefits and relief works are temporary palliatives, and the proposals in regard to overseas trade is a very poor attempt to deal with this great question. I hope that in the near future the Government will really put their head and brains into this matter and form some scheme whereby trade may be again renewed. We all know that the depression is world wide, and the purchasing power of the world is less. Nobody is buying, and that is our trouble. Let us have patience and I believe the eventual result of having patience and the Government taking a bold stand in regard to credit to all the traders will be far more beneficial than palliatives of this kind.
The only remedies which the hon. and gallant Member who has just sat down has to offer to meet the unemployment problem seem to be the drainage of the Bann, the putting up of electric lighting works in the neighbourhood of the town in which he lives, and asking bankers to be lenient with their clients. The right hon. Gentleman the Member for Camborne (Mr. Acland) suggests that we should have a bigger harbour at St. Ives. I profoundly trust that, with all our desire to reduce the misery of unemployment, neither of the schemes which have been put forward by these two hon. Members will be listened to by the Committee which is to be appointed when this Bill becomes an Act. This country lives on its export trade and it is to that export trade that we shall have to look to put the country right. If we cannot regain our export trade we may then have to fall back on putting up electric light standards outside Belfast or putting more moorings into the harbour at St. Ives in order to provide employment. I am not going to cover the ground covered over and over again by other speakers with regard to reducing the cost of production, to the high cost of coal, and to the necessity for good feeling between workmen and employers. All that has been talked about ad nauseam . We live by our export trade. We must look to that portion which has failed us of late and try to find out why it has failed us and if we can put it right. I take it that this Bill, dealing with overseas credits and advances to overseas customers is directed towards that end. I need not say very much about the trade position with bankrupt East Europe or even the Central European Powers to which we sent one-third of our export trade before the War. That we cannot do now to that volume, for the simple reason it is very difficult for us to get the people of these States to pay us, even if we advance the money under this Bill. But I have reason to believe that even with these bankrupt or semi-bankrupt States a deal of trade is however being done by some merchants and manufacturers in this country without the help of the Government, and on the good faith that exists between various firms in those districts and our own firms, on long credit it is true, but with every prospect of the business being remunerative in the long run.
There are, however, other parts of the world besides Europe, and there is one portion of Europe too with which we could do a large trade, but which puts such obstacles in our way as to make trade with it very unpromising at the present moment. France, it is true, is under the necessity of raising revenue and maintaining as much of her manufactures as possible in her own country. But she puts every obstacle to trade that might be done with this country, and thereby deprives us of the opportunity of doing with her the trade which we did before the War. There are, however, other countries with which we did trade. This was referred to in an indirect way by the Chancellor of the Exchequer, and also by the right hon. Gentleman the Member for South Molton (Mr. Lambert). The Chancellor of the Exchequer drew attention to the fact that we had built up a great trade in the world through the City of London lending money to countries which were not composed of people of our own kith and kin, but were foreign countries. That is perfectly true. Money has been lent abroad by British investors and the loans have been arranged in the City of London, and this money has done a great deal to build up our export trade. Take the money we lent to Argentina. We have, in the Argentine, railway investments probably up to the value of £200,000,000. That money did not go out in bags tied with red ribbon—in yellow sacks containing gold—it went out in rails, in machinery, in locomotives, and in rolling stock. We lent money to Canada, we lent money to Mexico, to Queensland, and other countries, and now we see, having lent money to those countries, they have attracted our capital from us and they confiscate it or destroy its earning power.
The right hon. Member for South Molton pointed out that there is no lack of money in the City of London for foreign loans. That is true so long as the loans are of a promising and safe description. For such purposes money can be raised, and we should be very glad if the political conditions in Argentina were such that we had faith in the administration so that the investment of British capital could be continued there. Argentina requires no long credit. She is not bankrupt. She can send us goods, food and other things in repayment for the money we lend her. But having attracted our capital the Argentine Government goes out of its way to destroy the earning power of the money lent to her, and thereby renders us indisposed to send out more money to that country in the form of the products of our engineers and workpeople. Yet she needs capital to develop her country. So it is in Canada. We have lent money to Canada to develop her country. We built her Grand Trunk Bailway—she takes it without paying for it. These are the markets which of late have failed us. The difficulty seems to be present in many places where money has been attracted from this country in the form of manufactured material, and then taken away from us either by Government or by local action. They reduce our opportunities for putting out money for investment, although such investment would result in the development of foreign countries or colonies and employment of people here. In Mexico we had £200,000,000 invested. That is not a bankrupt State. It has plenty of undeveloped resources. I do not know whether the Foreign Office has taken any steps with the United States to come to some arrangement to recognise the Government of Mexico, where we could send large volumes of manufactured goods which would help our own workpeople. Take Queensland again. I was very much surprised at a remark which fell from the hon. Member for Wellingborough (Mr. W. R Smith) last week, when he said we were not lending money to Queensland because London financiers had tried to put some political pressure on her. The fact of the matter is this, that certain English financiers in the past had lent money to Queensland and had asked small investors in this country to take up portions of the loan. Financiers in the City frequently distribute these loans in this way at a small or large profit among small investors here. The Queensland Government allowed the money to go into the country. It was invested in pastoral leases by a company which takes machinery from this country, but in the last year or two the Queensland Government has tried to confiscate the leases or to do something which destroys British capital sent there. Why lend money to the Queensland Government which maltreats it as soon as it gets the capital into its power.
That is the sort of thing that is going on all over the world. They take from us our capital which goes out in the form of manufactured goods, and then they destroy it and reduce our confidence in placing money in those districts. What is the Foreign Office doing in regard to looking after our capital in foreign countries? We had ÂŁ300,000,000 of British capital invested in Argentina, capital which went out in the form of goods and stock. How is it that the Foreign Office have not taken some steps to bring home to our friends in the Argentine Government the effect of their treatment of our capital there, and the trouble that that treatment is causing by reducing our opportunities for lending money which would go to the improvement of their own country besides helping our trade? I think the Foreign Office has in that respect a good opportunity of justifying its existence. Take the cases of South Africa and Australia. I happen to be connected with the shoe trade, which had a good market both in South Africa and Australia for boots and shoes. At the present moment, although these people are our kith and kin, and notwithstanding the protests we make to them, you can scarcely send a pair of shoes to South Africa. I do not know why South Africa should go out of her way to put these checks on British manufactures, but that is the reason why the working men in Northampton and Norwich are out of work; because our own Colonial Governments are going out of their way to treat us no better in regard to the import of manufactured goods than foreign countries, even though they give us a preference. At any rate, if we lend money to the Crown Colonies, the British Government will see that the investment is safe. I, therefore, welcome greatly Crown Colony schemes. The Indian railway system, we have been told lately, is very much below the mileage which it ought to have for a country of the size of India. The population of Argentina is, say, 10,000,000 as compared with 300,000,000 in India, 30 times as large. But the Indian mileage is no larger than that of Argentina. I do not know whether the Indian Government will compel the Indian railways to build their rolling stock in India, but if the Indian Government could be induced to buy a large amount of rolling stock in this country, under a loan guaranteed as to interest by the British Government in the form of credit provided by this Bill, that would be safe enough. The right hon. Baronet, who sits for the City of London (Sir F. Banbury) could find no fault with a loan issued for the purchase of rolling stock for the benefit of India, guaranteed by the Indian Government and the British Government. I think he would consider that an investment worth making and taking. If this Bill is applicable to Indian railways, I say it is a very good Bill, and must inevitably provide a very considerable amount of benefit to our people.
The hon. Member for the Spen Valley (Mr. Myers) touched a point in his argument which, although not quite right, I have a great deal of sympathy with. He was a little off the track, but, on the whole, I think he got rather near the bull's-eye when he talked about the inflation of the capital of certain companies in this country. I do not agree with him when he says that the inflation of capital or the writing-up of capital is likely to put up the price of goods produced by the concern, or render the goods less able to be sold on account of the high cost. I do not think that is true. Goods are only worth what they will fetch. You can write the capital up as much as you like, but if you charge too much for your goods you do not sell them. The consequence is, that people can only ask for their goods the price which those who purchase will give for them. If they do not ask the price which will attract the money, then they have to hold their goods or come down in price. Therefore I do not believe what the hon. Member for Spen Valley says with regard to the inflation of capital adding to the high cost of production. I do think this, however, that not only in regard to the cotton mills, to which the hon. Member for Putney (Mr. S. Samuel) referred, where financiers—and that is a word which is used by the Labour Benches very often in a wrong sense. There are financiers, great bankers, men who perform most valuable functions in this country. Sometimes the word "financier" is held up to ridicule or even scorn by hon. Members on that side, but there is a type of man called financier who is but a company promoter, and a pest and a nuisance. He is the type of man who exploits shares, who buys two or three quite sound old businesses, amalgamates them, refloats them with a larger capital, gets a good rake-off and, eventually, ruins the earning power of these companies. That man, and there have been several of that type of gentlemen knocking about England during the last two years since the Armistice was declared—I am not going to mention the names of the businesses with which such promoters are connected, they are well known, otherwise I shall be challenged to state them outside the House, and those whom the cap fits can put it on, but this has happened not only in the cotton trade but in other trades. The promoter has taken sound old firms or companies, over-capitalised them, and ruined them.
What has been the result? They have drawn the small investor into these com- panies, they have disheartened him by losing his money for him, and the consequence is that when sound companies and wholesome old-fashioned firms desire to raise money to extend their business, the investor is frightened and disheartened, and so is kept from putting his money into such businesses for the purpose of giving extended employment to working people. I think, however, that though the hon. Member for Spen Valley was not quite right in his view about inflation, this is a very good opportunity for us to ventilate in this House our view that public opinion, if not the Stock Exchange—certainly the Government cannot—should look with dislike and suspicion upon the efforts of company promoters when they buy up two or three fine businesses, re-capitalise them at a higher figure, making a great deal of money by floating them on the public and eventually cause the investor to lose. These people confer no benefit on the country, they do a great deal of harm to shareholders and workpeople.
There is another thing which has caused unemployment in industrial circles quite apart from this aspect of the question. You cannot employ men unless you have capital to employ, and the continual industrial disputes make the small investor chary of putting his money into companies, not only because he fears to lose it, but because of another psychological effect upon him. The small investor dislikes being in a company where the workmen are continually grumbling, abusing and speaking ill of him as a shareholder. He does not want to be in industrial affairs when he is held up to ridicule and looked upon as a slave driver and a tyrant, which he is not. He is often no more wealthy than some of the men working for him. The consequence is that the very strikes and disturbances which occur in the firms which need money for extensions and for employing more men increase the evil of unemployment, and in their way form a vicious circle. Thus arises one of the difficulties of starting new businesses in England. I have always thought, and I believe the view is singular, that the boom we had after the Armistice was not a boom brought about principally by the desire of the world for goods because they were short. In a measure that was true, but, as I have said before in this House, the boom that we had and the great demand for goods, more especially for cotton goods, was a silver boom.
After the Armistice, when the Bolsheviks had rendered Russian paper roubles, which was being used in Northern China and Manchuria, valueless to the Chinese, the Chinese refused to take that paper any longer, and bought silver. The consequence was that the price of silver went up very much, both in India and in China. You have 800,000,000 people there—half the human race—who know little about gold and who carry on their transactions and buy and sell in silver. On the sudden purchase of silver in 1917 onwards in order to pay these people, the Orientals, for the vast amount of produce that we had acquired for Europe, and because they would not take paper, but would only take silver, you had silver going up to, I believe, something like 7s. 6d. or 8s. an ounce. The consequence was that every ingot of silver that was in the possession of those 800,000,000 in the East was worth almost three times what it was on the day War was declared. The further consequence was that with every ounce of silver which these people had—800,000,000 of them, and you talk about stabilising exchanges and about restoration of gold standards, but people forget that half the human race does not use gold at all, but silver—with every lump of silver that these 800,000,000 people had, every bangle round their wives' legs or on their children's arms—that is where they keep it; they keep it in the East on the persons and the bodies of their relatives—they could buy nearly three times as many shirts with that sum as they could before the War broke out.
What was the final consequence? They bought a very great deal of goods in this country. There was a great boom in Lancashire and, as an hon. Member for Lancashire said, when Lancashire is busy we are all busy. That is profoundly true. That great boom after the War was for the most part brought about by the rise in silver in the East for the reason which I have just given. We are having a conference in Washington shortly—I say, at once, that I am not going to indulge in any discussion about bimetallism, because I know nothing about it; I have not been leading up to bimetallism in this discussion. I did not come into the economic world until after the bimetallic discussion had died out—but it would not be a very bad thing, seeing the influence which silver has on the finances of the world, if our Ministers who will be in the United States during the next few weeks were to have a little discussion with the United States Government to see whether we could not put the silver question on such a basis as might be of use to us in dealing with our Eastern trade. The hon. Member for Tamworth (Mr. Wilson-Fox) said that he hoped the Committee would exercise a wide selection of objects for these credits. Looking at Clause 1 of the Bill, I see that it applies to the purchase of articles "manufactured" in the United Kingdom. That question as to "manufactured" articles opens a wide field for discussion, and probably dispute. The peoples of Eastern Europe do not, I take it, require us now to send them manufactured goods; what they want is raw material, and I want to know where raw material leaves off and manufactured goods begin. For instance, at the present time certain people are shipping to Prague, or to Bohemia, cotton thread or yarn. It is not sold by us, but given out to the spinners there, who, with their cheap labour, turn it into textiles. We lend it and finance it and receive it back finished, and pay in kind. I see that the hon. Baronet the Member for East Nottingham (Sir J. D. Rees) is here. I wonder what he would say, on behalf of the city which he so ably represents, if a large amount of thread were sent under these credits from Lancashire into Bohemia, and turned into lace which was shipped back to Nottingham. I am afraid he would make a very strong protest. It is, therefore, necessary that the Treasury should now define, for the use of its Committee granting the credits, what is raw material and what is manufactured material. I should agree with my friends on the Labour Benches, and with the hon. Baronet the Member for East Nottingham, if they were to say they would put their foot down strongly if facilities were given to those who export yarn or wool in almost a raw state in the form of thread or yarn to the bankrupt East of Europe, to be turned into goods there by cheap labour and shipped back into this country. That is not what this Bill is for. We do not want to send foreigners raw material to be made up into manufactured goods to compete with our working people; we want our people to have work, and not to have competition raised against them by finished goods.
What about the unfortunate farmer who produces the wool?
We seek to sell the farmers' wool as clothes, not as thread, under these credit facilities. The object of this Bill is to get manufactured goods made in this country by our people and exported and not to give opportunities to people in other countries to manufacture goods with the aid of our credit. There is another point which seems to me to be germane to this statement in the Bill as to manufactured goods. The greater portion of our trade with Russia before the War was in two things—coal and herrings. The herring is the product of our shores and, before the War, we exported something like £4,000,000 worth of herrings to Russia and Northern Europe, our annual total exports of herrings being £5,500,000–3,000,000,000 fish. They went through Lubeck, Hamburg, Riga, Memel, Danzig, and St. Petersburg, and filtered down through Russia, Poland, and the Balkan States to Turkey and the Levant. The herring represents mostly labour, and herring in barrels, smoked or salted, is a manufactured article. I am not a Member for a Scottish constituency, but I wish some of the Scottish Members were here to back me up. I think that under this Bill it is worth urging the point that the herring in its salted state should come within this description of a manufactured article. It is of the utmost importance that we should keep the herring fishery going for more reasons than one, quite apart from the unemployment question. The herring fishery is the nursery of the Navy, and the herring fishers are thus the bulwark of this nation. In sending out the herring under this Bill, if they ask for credit—as they were, not under this Bill but on other grounds, some while ago—we are sending out labour in its best form. There is no money needed for raw material; nearly the whole cost of the herring trade lies in the labour of our own people. Therefore, before it is too late, I would put in a good word for the herring fishery under the description of an article manufactured in the United Kingdom, as provided by the Bill in Clause I.
The Government guaranteed herrings for two years, and lost over it.
Does my hon. and gallant Friend, as a Scottish Member, object to my suggestion? Perhaps he will take the matter up. I should also like to appeal to the Noble Lord the Member for Hitchin (Lord R. Cecil) who talked at some length about the humanitarian side of these credit proposals in relation to starving Russia. What better support can there be for this argument than that, in providing the finest possible form of food for the starving Russians, you are at the same time doing good to our own working people? Not only will Clause I allow credits to be given to private people, but it will, I take it, allow credits to be given to foreign Governments. I should like to examine where this leads us, especially as I see that the Financial Secretary to the Treasury is here. Suppose that the Government of Rumania or Timbucto comes to a great firm of locomotive builders in England and says, "We should like to have a number of locomotives, worth ÂŁ100,000,000, and we will pay you in a year's time." Against their debt, one year Treasury bills will be issued, which will be accepted by them and guaranteed by the British Government, just as if they were a foreign firm buying locomotives for a hundredth part of that value. Do I understand that under this Bill the Government is going to finance the Treasury bills of a foreign Government in order to increase the output of engineering work?
Perhaps I may correct what is a common misapprehension. The Government will not grant credits for ÂŁ100,000,000. In the first place, there is a limit of ÂŁ20,000. In the second place, it is not lent on Treasury bills. It is expressly specified that the powers of the Treasury in this matter only extend to the giving of guarantees.
Technically the hon. Gentleman is right and I am wrong. I withdraw the reference to ÂŁ100,000,000, and I agree that the money is not lent on Treasury Bills. But suppose that the Rumanian Government come, say, to Messrs. Vickers, and say, "We want to buy a certain number of engines from you for ÂŁ10,000,000," that Messrs. Vickers agree, and that the Rumanian Govern- ment accept bills payable 12 months hence for ÂŁ10,000,000. Then, if the transaction has been agreed to by the Committee which is going to be set up, Vickers take the bills to' the Treasury and the Treasury endorses them, whereupon those bills which have been accepted by the Rumanian Government will have the guarantee of His Majesty's Treasury on their backs, and they can then be rediscounted in England, if any bank has so much money for a single transaction of this kind. It means that in these circumstances His Majesty's Government has issued a loan to the Rumanian Government for one year by its guarantee to the Rumanian Government for the purchase of railway materials. Is that the intention of the Bill? It seems to mean that, and if so, I do not like it. I do not like the Government thus lending money to foreign States, whether bankrupt or otherwise, because, for some reason or other, sooner or later, they will do some double shuffle and get out of paying whatever their loan may be if they deal with a foreign Government. I hope that this Government will not countenance the financing of the purchases of manufactured goods in this country by foreign Governments. Private people and firms abroad are more honest than foreign Governments.
I should like to get off my conscience one observation which I trust the House will allow me to make. We know very well that we want to get this unemployment matter put right. We know very well that the only way to put it right is to re-establish our export trade. But the way we are going, in general principle, to re-establish our export trade and the way we have been going from the day the Armistice was signed is, I submit, a wrong method. The principle on which the country is carrying on its extension of the export trade is trying to set up an export trade resting upon nothing. In my opinion the only way of helping any export trade in this or any other country is to build up the home trade. Our first duty should be not to try to bolster up an export trade by any other method. I shall support the Measure because it is the best instrument we have at hand. I shall do all I can to make it work, in such ways as may come within my province, and the body with which I am connected, the Association of British Chambers of Commerce, will also do all they can under the Bill, whether its policy is wrong or right, to help men to get a decent living and a meal on their table and a roof over their heads. But 1 feel the principle on which we have been working for the last two years of trying to force an export trade resting on nothing must eventually cause us to reconsider the whole of our economic principles.
List, the man who wrote the "National System of Political Economy," built up the system, from 1850 onwards, upon which the whole export trade of Germany as it existed before the War was founded. He showed that an export trade can only be the overspill of a healthy and saturated home market. We adopt the contrary system. It is no good denying the fact that the book that he wrote is a marvellous book. He looked at economic questions just as a chemist does when he looks at a substance through a microscope. List analysed the position and found that the only way to get a healthy export trade was to build it up on the overspill of a home trade, and the cost of production was brought down by the increased production you obtained for your home trade. Let us reconsider our policy of the rebuilding of our export trade on an unsubstantial base. Its foundation is not theoretically sound. It is a shocking and a shameful thing that, while men are standing starving in Glasgow, £19,000,000 worth of manufactured steel is coming into this country. It is a shocking and a painful thing that, while men are standing hungry in Glasgow, the Clyde is full of manufactured goods from outside. I hope the House will give me credit in what I say of being honest and just. I am not arguing at all from the fiscal point of view, but every effort should be made by the manufacturers of the country, without Protection, without any effort of the Government, to collar British trade at home and to increase their production so that the mere fact of the increase of their own production in the home market will bring down the cost. There we have the proper basis in the overspill of our home market. In making the profit which will result from the increased home production they will have some money to play with to go out into the highways and byways in foreign countries and try to take some risks. [An HON. MEMBER: "Dump abroad!"] I would rather dump abroad than see people here idle. These are my views upon this Bill. I do not think it will do very much good, but it is well intentioned. It cannot lose us very much. A certain percentage will be charged by the Treasury for its guarantee and may cover losses over its entire risks—and when we look back after a year's work we shall then have an opportunity of learning what there is in the principle of export credits, and whether the country has lost or gained by this experiment. We shall know a little more about how to help the export trade, and to that extent we shall, at any rate, show our working people that, whatever expense we have been put to, we have done our best to help them over these difficult times.
We have had a very interesting discussion, and I do not think one would be very far wrong if one said we have surveyed mankind from China to Peru. There have been echoes of the old bimetallic doctrine. We have had a good deal said about the various products of India, of Russia, of God knows where. We have had a re-hash of the old individualistic theory. We have been told that it is really hopeless to attempt anything in the nature of State socialism, and that we had better on this side accommodate ourselves to hard facts because this is a competitive and an individualistic world. And almost in the same breath the right hon. Gentleman who spoke of this being a competitive and individualistic world stated that he would support the State in helping various enterprises with £25,000,000 of capital. If it is so completely a competitive and individualistic world as the right hon. Gentleman stated, carried to its logical conclusion I suppose it would be that each individual must do his best, utterly regardless of anyone else—every man for himself and the devil take the hindmost. That is the theory in its nakedness.
But this Bill is a complete negation of that theory. The facts of the last seven or eight years are a complete negation of the statement that we are living in an individualistic world. Seven years ago the walls of every town and almost of every village were placarded with Bills that "Your King and country need you," that the State was in danger. What matters that if this is a competitive and individualistic world? I thought myself a few years ago that we had developed the idea that the interest of the State should totally submerge the interest of the individual, that we were living in a time like that of the old Romans "when none were for a party and all were for the State," but the idea underlying this Bill is that the State must come to the help of the individual, that capitalistic undertakings are on their last legs, that these various undertakings depending upon private enterprise find it impossible to live, that oxygen, to use the striking metaphor of the Prime Minister himself, must be applied to the heart of the undertakings to give them a new chance of life. And it is the State that is called upon and not the private individual. The private individual possesses no credit. His undertaking is bankrupt. [HON. MEMBERS: "NO!"] Not only is the statement repeatedly made in this House, but we know as a matter of fact, that these undertakings in hundreds of cases are practically bankrupt, and unless the State credit is given to them the whole thing collapses.
The State's credit is to be given to individuals in foreign countries, mostly under Socialist governments.
We are speaking of Great Britain. This Bill applies the credit of Great Britain, and we are not talking of foreign countries at the moment. The ÂŁ25,000,000 which is to be guaranteed is to be found by Great Britain.
For foreigners.
To restore the credit of British undertakings. [HON. MEMBERS: "No."] Yes, it is. I maintain my point that that is the case. [HON. MEMBERS: "No."] You must do it either through the Government or through the banks, and it is on behalf of British undertakings. [HON. MEMBERS: "No."] I stand by my statement, that the full effect of this Bill is to help British undertakings to re-start, and to gain a position which at present they do not possess. [HON. MEMBERS: "No."] Is it for the foreigner? [HON. MEMBERS: "Yes."] Is this nation called upon to shower blessings upon the foreigner?
Ask the Minister in charge if that is not the object of the Bill.
While I have always felt a good deal of brotherly love towards people on the Continent, my real love starts at home, and if I thought that the effect of this Bill would merely be to improve the economic and industrial condition of the foreigners, I should be a good deal more loth to vote for the Bill than I am at the present time. Passing from that point, I am greatly interested to see the difference between the attitude of the Government on this Measure and the attitude which the same Government took up only a few months ago. The Bill says:
In that undertaking we were told by the Prime Minister that the full effect of any loss could not be more than about 42½ per cent, of the amount involved. I do not complain in the least that the Government are prepared now to help capitalist undertakings, neither does the party with which I am associated. We shall support the Second Reading of the Measure. I do not complain, that the Government show a real willingness to come to the help of capitalist undertakings now, but I do complain that their attitude is a complete right-about-face from the attitude which they took up in connection with the coalmining industry only a few months ago. There has been a good deal said about coal this afternoon. The coal industry is quoted as the persistent and undying cause of all the trouble with which this country is confronted. That allegation seems to be as insistent as King Charles's head. Every capitalist, every shipowner, every iron merchant, the moment he permits his imagination to roam, declares that the coal strike was the cause of all our troubles. [HON. MEMBERS: "Lock-out!"] I will say "stoppage." Up to the coal stoppage we are told that things were delightful, but I would remind hon. Members that long before the coal stoppage there were hundreds of thousands unemployed, and that the total number of unemployed was going up by leaps and bounds, week by week. I suppose there must be somebody or some industry to be made the scapegoat, and inasmuch as the Miners' Federation and the coal industry were the cause of all the trouble, it is just as well to go on repeating it, although five minutes' consideration would prove that it was utter nonsense. It is said, "If only there could be goodwill between employers and workmen, what a different state of things we should have." The first means by which the workman has to testify his goodwill is to submit to a continuous reduction in wages. The capitalists tell us, "We do not want to reduce wages. We like to keep wages at the very highest point, but we must meet the competition of the world." The hard fact which we have to face is that this is a competitive world, and although we are supposed to have won the War, although it is supposed that Germany was defeated and reduced to the lowest level of humiliation, yet the British workman who won the War is to pare down his condition week by week and month by month until he comes to the condition of slavery held now by the German workman. That is really the argument that every one of you repeat. You say, in effect: "The Germans are working so many hours, and turning out goods at such an astonishing rate, that if we, the kind-hearted capitalistic employers, are to maintain our places, you men who won the War must submit to the same conditions of slavery" I defy any hon. or right hon. Member to say that that is not a fair and logical conclusion to be drawn from the arguments that have been adduced.
I say it is not.
It is a perfectly logical conclusion. Supposing we do that, and supposing that the profits are not made, I suppose you will say: "Really, men, we cannot compete in the markets of the world. The Germans are still beating us You will have to work harder and longer and submit to lower wages." To-day capitalists are urging that the men must work longer hours for lower wages, and that they must produce more. There are to- day a greater number of parasites relatively to the number of producers on the back of industry than ever before in the history of the world. That is a fact which very few of you care to face. In every coast town in Great Britain to-day you will see the hotels packed with people living on the back of labour. In every great hotel on the coast or inland and at every spa and watering place there are men and women who have never done a useful turn for years living upon the back of industry. You talk of not being able to raise money for productive enterprises The country has always found money for any enterprise that was worth the backing. The returns month by month show that there is an infinite amount of money to be invested if there is any chance of reproductive enterprise. But this is not for reproductive enterprise. This is to finance what at the present moment are practically bankrupt enterprises, and whether it is in this country or on the Continent, it is, as it were, a form of oxygen which has got to be provided for a person whose heart has almost ceased to beat.
Talking about coal, which is the foundation of industry, I remember the Prime Minister coming to that Bench and speaking of the conditions of the agreement which the miners were compelled to accept, after the most prolonged struggle that industry had ever engaged in, and he declared that agreement to contain the greatest example of profit sharing that has ever been applied to industry. We have had three months of it, and in my own county, Lancashire, in the case of the worst paid men the wages of the men have been reduced by practically 30 per cent. Within the three months their wages have gone down from a little over 12s. to a little over 8s. a day, and this for two or three days in the week means a little less than is required to maintain a pauper in the workhouse; but they are still called upon I suppose by further reductions to prove the goodwill which ought to exist between employers and employed, and while that process of profit sharing has been taking place many hundreds of thousands of pounds have been made of direct profit by the employers in the country. That is an example of the profit sharing which the Government imposed on the mining industry, and we are still told that we are the cause of all the mis- chief and that our wages must be lower still if our industry is ever to revive. Of course the employers told the nation that they were willing to hand over all their profits to prove their camaraderie .
So far as our party is concerned we have no ill will to this Measure, but we have ill will to the capitalistic system, and that you will ever under this system do away with the evil effects which we see to-day I take leave to doubt. We are speaking of what has taken place in Great Britain, of what has happened in a victorious nation after the whole nation had done the necessary work, and after we were told that we should never go back to the horrible conditions of former days. We are speaking now, when we really ought to be singing psalms of triumph, from the Book of Lamentations. We say now that this system doomed itself during the War, that we have no ill will to the Measure itself, but that it will not produce the effects that you think it will and which you desire and we desire. We desire to have our people put to work at profitable undertakings instead of receiving payment from the unemployment benefit fund. We would sooner see our people engaged in productive enterprise than walking the streets broken hearted and losing their manhood day by day. But this Bill will not bring that about, though we are not going to do a single thing to the Bill to hinder its prospects.
When hon. Members speak of good will between employers and workmen, they ought to know what they are talking about. When they speak of high wages preventing the progress of industry they ought to know what they are talking about. This afternoon the hon. Member for Maldon (Sir F. Flannery) spoke of a contract being lost to the North of England because the lowest tender from that district was three times the amount of the tender sent in by a Dutch firm. I asked him whether he had gone into the matter, to find out if, assuming that the workmen had given the whole of their services without receiving a penny of wages, that tender from the North of England could have been accepted. He entered into a long tirade, but he did not answer the point. I have no hesitation in saying that, if the arithmetical facts were as he gave them, then, even if the workers had given the whole of their labour for nothing, that particular contract could not have been accepted, and the lowest tender which could have been made from the North of England would still have been higher than the Dutch tender.
In such circumstances how foolish it is to indulge in these constant tirades against the high wages. I say that now in the greatest industry in this Kingdom, an industry upon which all the rest are dependent, and which must be brought back to something like normal lines if ever trade generally in this country is to revive—the coal mining industry—our people are receiving wages which are less on the whole than the amount which is required to maintain a pauper in the workhouse. I do most earnestly hope that hon. Members will refrain from throwing their reproaches at an industry out of which vast fortunes have been made in the past for everybody except the workers themselves. When we were appealing to the Government a few months ago not to be so hasty in decontrolling the coal industry, one of our chief opponents was the hon. Member for Dumbarton (Sir W. Raeburn) who is so well known in the shipping world. He strongly opposed the continuance of any help by the State to the coal mining industry. Now the hon. Member appeals to the State to come to his help and to bridge the difference between the wages they are willing to pay to workers on the Clyde and those they are able to pay, but the hon. Member was utterly unwilling to extend such help and sympathy to the coal mining industry. That, which is typical of the hon. Member, characterises the Government also. They are perfectly willing to help every other industry now. They see that the whole fabric has collapsed and that only the State acting as a whole can do anything effective towards a remedy. They are, therefore, willing to extend to all other undertakings that which they denied categorically and callously to the mining industry. Nevertheless, we have nothing but charity in our breasts. We shall do nothing to upset this Measure, and we wish it may have the good fortune that even its sponsors desire.
Since the hon. Member who has just spoken and those with whom he acts are so much in favour of the principle of the Bill, he will, I am sure, understand the reason why I refrain from entering into any form of conflict with him in those more attractive regions of controversy which he has opened up in his very vigorous speech. Let us postpone inevitable subjects of difference to those Debates in which they are inevitably relevant, and when we have the good fortune to find a measure of agreement let us make the most of it. The House would be surprised if I did not say a word in recognition of the very helpful spirit of co-operation in which this Debate has been conducted. Throughout, one has had a sense that speakers were seeking for subjects of agreement, were avoiding inevitable differences which did not apply to this measure, and were making the best of their co-operation with the common effort. We are all impressed by the evils of the present time, and we all desire earnestly to find the best way out of the difficulty. In the second place, possibly a part of this measure of agreement and consent may be due to the fact that this Bill is put forward in no exaggerated spirit of too great claims on the part of its promoters. It has been said, as part of the basis of this programme, that there is a great sphere of remedy in which no Government by itself can do anything. All that is claimed for this Bill is that within that minor and more limited sphere in which Government action can play a part this Bill is the best that can be devised and will achieve the greatest benefit which a Measure of this House can achieve.
The course of the discussion has turned for the most part upon the first part of the Bill, and to a minor degree only on the second part. Upon those measures which are now more familiar to the House, the measures relating to the overseas trade credit scheme, there are only one or two details to which it is necessary for me to refer in my task of conveying information on the points raised. There was one definite minor point, but of much interest to Members, in connection with the herring. Here let me say to those who take an interest in that matter, that it will be possible in the course of the administration of the measure to include, at any rate, the more highly manufactured variety—the humble kipper. This is to include pickled herring, for which an eloquent appeal was made by the hon.
Member for Farnham (Mr. A. M. Samuel). Let me pass now to the other part of the Bill.
Before the hon. Gentleman leaves the second part of the Bill, may I ask a question? It says in the Bill that the export credits are to be extended to all countries. Does that include Russia?
The words are permissive. Any country may be included.
Is it intended to include Russia?
No.
Why not?
I shall now proceed to what I feel the House considers to be the more interesting part of the Bill.
May we have a reason for this? [HON. MEMBERS: "Order, order!"]
I shall proceed to the first part of the Bill which deals with the guarantee scheme. In its origin, I believe, most of the detailed criticism that has been directed against this part of the Bill and most of the information that has been asked for, has been in connection with the constitution of the Committee for the administration of the measure. Why, it has been asked, have a Committee at all? For two very excellent reasons. In the first place, because by means of a specialised Committee you can bring the greatest amount of knowledge to bear upon the subject. I am far from saying that great knowledge of these matters in connection with financial schemes could not be found in Government Departments. Adequate knowledge could be found there, but I believe that the best knowledge, the most useful and valuable experience, as regards which of these schemes will be best for the purposes of the measure, can only be obtained by going to the world of commerce and finance. There is another good reason. Let us remember the conditions in which this Committee will act. It will have a very limited sum to apply in guarantees and it will have, no doubt, a very large number of applicants. The applicants may be expected to be very much in excess of the amount which the Committee will have authority to cover. There must be, therefore, something in the nature of competition. In these circumstances, is it not absolutely essential, in order to avoid suspicion of partiality or of pressure—[An HON. MEMBER: "Or log rolling!"]—or anything oblique—that you should have a tribunal, exercising what I should call semi-judicial functions and composed of persons of such authority and position as will be free from the least suspicion? The theory has been advanced, chiefly by the right hon. Member for Peebles (Sir D. Maclean) that there is a fear that by the erection of this Committee the proper functions of this House may, in some way, be usurped or displaced. That theory has been expressed on the one hand, and on the other hand a fear has been expressed lest the Committee should not be allowed adequate independence and freedom from any form of political control. I do not believe it is in the least difficult to reconcile these two essentials. In practice and in fact the Committee will arrive at its decisions, both as to which applications are to be accepted and on what terms those applications are to be received, independently and without any form of Treasury interference, and that is the intention as regards policy. At the same time it is recognised—nay, indeed, it is claimed—naturally by a Treasury Minister, that in so vital a matter as the pledging of the nation's credit it is impossible that the Treasury should demit ultimate responsibility, and it is impossible that this House should not hold the Treasury responsible to it for its action in such a matter. It will therefore be essential that the Treasury should remain ultimately responsible for the decisions of the Committee, and that in order to exercise that responsibility it should have power in law to withhold its consent, if need be, to any decision of the Committee, though it is freely recognised and, indeed, it is announced as a matter of policy, that that consent will not be withheld except under the sort of circumstances which this arrangement is intended to guard against, circumstances which would be of a most exceptional and, indeed, I might almost say unlikely or impossible, nature.
Will that Committee be appointed by the Cabinet or by the Treasury?
It will be appointed by the Government. The policy and the position of the Committee will, I think, require further consideration on the part of the House, as regards the position which it will be necessary to allow to it. Let me urge upon the attention of the House, in such a sphere of administration as this, the vital necessity, subject to those safeguarding provisions to which I have referred, that the Committee shall be allowed a free hand in the conduct of its business. It is to be given this asset to administer for the benefit of unemployment and for the revival of trade. Once it is erected, I believe that it will be of the utmost importance, in order to obtain the maximum result of good from its labours, that it should have as wide a field of choice as possible for those works which it is to guarantee, and as free a hand as possible in the settlement of the conditions upon which the guarantee is to be given. Questions have been raised in the course of the Debate to-day as to whether it is policy to give guarantees to foreign countries and to private firms, and arguments have been advanced, I think, by the hon. and gallant Member for South-East Leeds (Captain O'Grady) in favour of an extension of the preference to small firms in place of large firms. As to all these matters, I would say that if the Committee is established, confidence must be held in its decisions. It is wise that it should be given the wdest field of choice that it can make. Its business will be to find to what businesses it can give this encouragement of the guarantee with the greatest possible benefit to employment and to trade as a whole. The wider you make its field of choice, of foreign countries, big firms, little firms, British Dominions, and so on, the better will be those accepted undertakings to which the assistance will be given—the better, of course, I mean, for their purposes of giving employment in this country and of reviving trade. Throughout the speeches of my right hon. Friends, who have already related to the House the major policy of this proposal, the utmost stress has been laid upon the prominence which will be given in any allocation of guarantees of this sort to undertakings of the British Dominions. That, of course, must always be, and I imagine that no special instruction will be necessary to a Committee of the sort which is contemplated to force upon their minds and attention the essential, vital utility to our trade, and the trade of the whole Empire, of giving consideration in the first place, and special emphasis, to Empire undertakings. Let me here say a word of caution, or rather, if I may say so, of protest against the description of this proposal which was given by the hon. Member for Ince (Mr. S. Walsh), and one which was touched upon by the hon. and gallant Member for North Armagh (Sir W. Allen) in the course of his observations which held the House in so much interest. It cannot be said too clearly that nothing is more remote from the intention, nothing, it is confidently anticipated, will be more remote from the manner in which this scheme will act than that it should be in any respect, or make any approach whatsoever toward being a scheme for the bolstering-up of undertakings which are approaching insolvency. So far from, that being the intention of the scheme, of course the proposition is ridiculous, and, so far from it being the effect of the scheme, the reasonable thing to anticipate is that, with the wide field of choice, and all the precautions to which I have referred, and to some of which I may refer briefly, those undertakings which are accepted, so far from being at the bottom of the scale of credit, or verging to the bottom, as described by the hon. Member, they will be undertakings which are situated at the very summit.
Cannot they be financed without Government assistance?
I will come to that in a moment. The limitations, if I may so call them, at the present time, or directions, given to the Committee, are partly contained in the Bill. They are, in the first place—and it is, of course, the root of the whole scheme—for the benefit of unemployment. In the second place, it must, of course, be a high question of policy for the Committee to consider that which has frequently been urged, and argued both ways in the Debate to-day, and that is the effect of this proposal upon the cost of production. It may be argued that any scheme of this sort must tend to keep up prices by increasing the supply of credit. Against that you must set this, that any scheme such as this to increase the means of transport and the means of production will increase the supply of goods available, will tend to cheapen the cost of production and transport, and so will tend to counteract, on one hand, what is undoubtedly the effect of increasing the supply of credit on the other. But I believe in practice the truth is that such dangers as we have had described in the course of debate to-day as increasing the cost of production under the Act are illusory. I believe a more careful examination of the manner in which the scheme will work will prove it to be impossible.
The only financial assistance in the Measure which can be given under this scheme, if it be carefully examined, is the difference between the lower rate at which an undertaking will get its money with a guarantee and the higher rate at which it would have to get it without the guarantee. That is the limit of the help the State will give under the scheme. Undertakings which could not be carried out because of the high cost of production, even in spite of that assistance, obviously will not come for the guarantee. All those who do come in and who are assisted to get their works in hand by means of the money being guaranteed will do so with assistance, but beyond the extent of this quite small margin of the help given by the Government scheme, there is going to be of no effect whatever in subsidising the cost of production. Admittedly if that be so, there are many capital works which are held up by the high cost of production at the present time which the assistance of this scheme will not allow to be got in hand, but there are a large number of works, I am confident, and many of these the most promising which can be undertaken with the assistance merely of these credit facilities and it is those that we expect will be brought into execution, and provide employment, by means of the financial facilities given by Clause 1.
Finally, I do not think it can be too clearly emphasised at this stage that only those concerned may hope successfully to obtain the guarantee who can demonstrate that without the guarantee they will not be able to get the money. All those concerned who can put their undertakings in hand without the assistance of the guarantee, and are able to do without such assistance will not be able to get it. It is beyond that region that you have the critical point at which the State can apply itself to aid by means of this scheme. The point has been raised in this Debate and criticism made that when the State is offering this credit assistance it should reserve some part of the profits—as I understand what is proposed—and participate in the benefits that accrue. In fact the State does reserve participation in taxes. That, I submit, is a true way in which the State can participate in the revival of industry. These are all matters of difficulty and controversy, and if anything practical is to be done let us keep clear of questions that are not intrinsically involved in the actual measure of benefit which we are trying to secure by the simplest possible machinery. It will be obvious to hon. Members that the Committee, in considering the conditions upon which the guarantee is to be granted, will have to take into consideration as one part of their business the prospect of the return of the capital. I can imagine if the Committee were to come to the conclusion that the undertaking was likely to be very profitable they might consider that in the period during which the advance was to be repaid. It appears to be a reasonable provision that, if the undertaking does very well, the Government should the sooner be released from all obligations under the guarantee.
There is another point which has arisen in the Debate which still remains to be made clear, and that is the criticism that the machinery of the Bill does not provide for a direct advance from the Treasury, but only for guarantees. The reasons are very simple and very plain. If you have only guarantees, then you have the great check of a public subscription. The best safeguard is that you should arrange the financial adjustment so that finally a loan has to come out and be subscribed in some form or other by the public investor. This scheme provides the industrial public with an opportunity far lending their hand and co-operating in a measure of national co-operation for remedying the great evil of unemployment. Here is an opportunity for the investing public, in regard to an ascertained measure of industrial expansion and recuperation, to join with other forces in that common effort which has been described as necessary in any true remedy for the great evils under which the country is suffering.
If there is one special circumstance which should recommend this Measure to the House in particular it is this, that at any rate it is an endeavour to deal with the problem in a manner which the critics of the Government are always wont to call upon Government to deal with any problem—to begin at the beginning and start from the very bottom. This Measure has a condition in it, a circumstance in its nature, which deserves special notice, in that it is an attempt to get rid of the evils of the world after the War and after the destruction of the means of production due to the War. What could be more fundamental towards remedying those evils than a Measure directed towards rebuilding some of those parts of the structure of production and overtaking some of those delays and some of those conditions most requiring recuperation and restoration which also were the result of the War?
The hon. Gentleman who has just spoken has taken a rather different line from that adopted by the Chancellor of the Exchequer for in his concluding remarks he expressed a hope that at last we were really coming down to fundamentals and that this Measure was not so much a palliative as a real attempt to reconstruct the countries broken by the War. The Chancellor of the Exchequer in his speech said, and the general tendency of the Bill supports his view, that a wider extension of the measure will result in the countries broken by the War not being greatly assisted. There appears, therefore, to be a certain divergence of views between the hon. Gentleman and the Chancellor of the Exchequer. Turning to the general trend of the discussion, one may deduce two extreme standpoints which unite in upholding a common fallacy. The right hon. Baronet the Member for the City of London (Sir F. Banbury) and his friends said that all the evils of the situation which confront us can be ascribed to high wages and low production resulting in high costs of production, and they produced proposals for the repeal of the Trade Disputes Act and of the Trade Boards, and generally to make a drastic attack on wages. But they omitted to explain how, when all these benignant reforms have been effected they are going to sell their goods even at a very low price in markets which possess, no purchasing powers at all. That is the situation to which we are addressing ourselves. It is not a question whether the goods to be sold are expensive or cheap; it is a question of finding markets which can buy them under any circumstances. Then we have at the other extreme my hon. Friend the Member for Spen Valley (Mr. Myers), who, in a very eloquent and forcible speech, laid all the crime of the present situation at the door of the capitalist or the individualist system. He also omitted to explain how even a Socialist State, functioning as perfectly as its advocates claim it will function, could dispose of its commodities in markets which cannot return any commodity in payment for the goods we send. We are to-day faced with the situation, that however low our costs of production under our capitalistic system, however effective the working of a Socialist system, if we had one in this country, the great foreign markets, on which we were dependent as an island, exporting manufactured goods and importing raw materials and food, are, for the time being, down and out, and that is really apart altogether from those controversial questions of high or low cost of production or, indeed, of Socialism or Individualism. The position we are confronted with to-day is that our exports are about half what they should be owing to the complete disruption and breakdown of foreign markets. The situation is that in the first nine months of this year, compared with the first nine months of last year, we find a decrease in our total exports of some 49 per cent. If we take the year 1913 for the same period, and translate it into present values, we find, for the first nine months of this year, a decline of some 40 per cent, in our total exports. That is the situation with which we are confronted, and it is quite evident that this measure for the revival of export trade, which proposes to devote ÂŁ23,000,000 towards the reconstruction of our former world markets, is entirely inadequate for the purpose. It is equivalent to trying to meet the force of a cyclone with a pair of bellows.
It is utterly ineffective, but so far as it goes we must consider whether it is effective or a pure waste of money. The Government of course, themselves do not claim that this is a complete remedy for the situation with which we are confronted. They are not so foolish as to advance a claim such as that, but the business of the House is to consider whether, in so far as it can be utilised, this Measure is effective for the purpose or whether it is a mere waste of money, adding to industry its heaviest overhead charge, the charge of taxation. To arrive at a just conclusion ion that subject, we must really diagnose the state of those markets which to-day, either from an utter lack of purchasing capacity or from the pressure of novel competition, are unable to-day to receive our commodities. As I have said, in markets without purchasing power it is evidently not the fault of labour or of industry in this country that we can no longer command the markets; but in the case of markets which still retain their purchasing power and can receive lour commodities, if we can put these goods on those markets at a certain price, in that case it has been alleged throughout this Debate that the entire blame rests with labour, in that it is producing about 80 per cent, of what it did before the War, and that wages are relatively higher than before the War. It will be at once admitted that high wages and low production mean high costs of production, and are great handicaps upon, industrial recovery, but that is by no means the whole story. It has been stated, and rightly, in this Debate that the heaviest overhead charge of all is that of taxation. The seeds we have sown in the past are being gathered to-day in unemployment in this country. It is a sad reflection that, possibly, the money we have expended in the past in preventing disorder among the tribes of the desert is to-day fomenting disorder in our own home sphere. We are reaping what we have sown in bitterness and tears. The greatest incubus to-day on the industry and on the recovery of the country is that great load of taxation which has been piled up by the follies of the last three years. It is not merely a question of high cost of production, and on the top of that the overhead charge of taxation for in these great markets that we had before the War we are faced to-day with a fierce competition, an unfair, unnatural, abnormal and temporary competition, with which we were never confronted before the War, and which is a direct result, partly of the peculiar conditions of our epoch, and partly of the policy which the powers of the world are pursuing to-day. In those great markets which still possess purchasing capacity to-day, we are faced with a competition which never confronted us before, through several new factors. There is German competition. Germany, driven under the incidence of reparation, has naturally paid her reparation, as has been so frequently stated, by an excess of ex ports over imports; and, working feverishly, she is able to put on to those markets great quantities of goods which compete with our commodities. In that she is assisted by that bounty on her exchange which she obtains by the difference between the external and the internal value of her currency. Driven by reparation, and assisted by this bounty, Germany is putting up an unfair and un natural competition against our goods in every market in the world that still possesses purchasing capacity. And we are not only faced with German competition. There is the new Oriental competition, largely engendered by the War, when the great producing countries of the West were temporarily out of the picture, and those Oriental countries were given a chance to capture our markets. These countries, such as Japan, have now introduced Western machinery, and, with their extraordinary hours of labour and their low wages, are able, with the assistance of this new machinery, to turn out commodities at prices with which we cannot hope to compete. We have just released them from any possible shackles of fair competition by our repudiation of the Washington Conventions, which would have imposed upon them more or less the same conditions which prevail in this country. We repudiated those Conventions on a mere minor point of convenience, and so have enabled those countries, if they so desire, to escape the obligation which would have imposed a certain degree of fair conditions upon them in competing against us in our great markets. Even in those markets which still possess purchasing power it is quite evident—
Would the hon. Member give us the names of two or three countries which have no purchasing power, as he has mentioned the point several times?
I was just coming to that. [HON. MEMBERS: "Hear, hear!] Hon. Members who have only just come in, and have not been attending to the entire discussion, may be unaware that the whole world situation has been traversed in the course of this discussion, and it has been frequently pointed out that not only have we lost markets whose purchasing powers have gone, but also, for various reasons which have been alleged, have lost markets which still possess purchasing power, and it was to that point that I was addressing myself. I was endeavouring to show, firstly, that there are many factors in the situation beyond the high cost of production, even in those markets; and, secondly, that in such markets a Measure of this sort will, to a certain extent, provide an artificial bounty upon exports. I followed very closely the hon. Gentleman who has just replied for the Government, and I am still of the opinion that, if it has any effect at all, this Measure will to a certain extent provide an artificial bounty, a subsidy, in fact, to exports in these cases, to a certain extent—not very much I admit.
11.0 P.M.
I now come to the other way which my hon. Friend has just raised. I do not say there is any country in the world without purchasing power of any kind, but I should say such countries as Russia, Austria, Poland, the great mass of Central Europe, and even Germany herself, our second best customer before the War, for all practical purposes are to-day without purchasing power of any kind, and it is to those countries and to our own Colonies that this Measure, in my opinion, should be applied. After all in those countries and in our own Colonies much the same conditions prevail. It is a case, as I saw it happily illustrated the other day, of sending a plough which will ultimately be paid for by the wheat it produces. Those countries have potential wealth. They have no actual wealth to pay for our exports, and a Measure of this sort, to a certain extent, will be very useful in that way. But I do not think it is the right way. Rather than guarantee the exporter at this end, I would see the matter approached more in the spirit of the Ter Meulen scheme, which at this moment is under the auspices of the League of Nations. A scheme such as that, instead of assisting the exporter in one isolated country, seeks to enable these broken countries themselves to raise credits by pledging their actual assets, and their potential assets, which cannot immediately be developed, in order to buy the raw materials and the machinery to restore their country to prosperity. Such a method as that will be cheaper for us and more effective for the purpose. It should have been undertaken at least three years ago, at the time the Prime Minister was so busy at Versailles drawing impossible boundaries and entirely forgetting that Europe was approaching a state of ruin. [HON. MEMBERS: "Divide."] I intended to draw my remarks to a close in five minutes, but if I am interrupted I can dilate on the subject to any extent. The voices of some of my hon. Friends are always more powerful in disorder than in debate. Any Measure such as this, of whatever character, are three years too late, and before entrusting the same body of men who are responsible for the catastrophe which to-day threatens to overwhelm us with the remedies to get out of that catastrophe, we should examine the circumstances which have reduced us to this pass. The case may be summed up in one short quotation from Mr. Keynes' book, which was published in 1919: international agreement and international action to recognise the potential assets of the broken countries and to supply them with the credit to get their raw materials and their machinery, so that they may become prosperous again and good customers of this country. That is really the only way now, as it has been in the past.
I welcome this Measure as far as it goes, though, as usual, it shows no very deep consideration. I beg the Government to turn to the international side, and I hope that when the Prime Minister goes to Washington he will extend his inquiries and strive to devise some means of international action that will resuscitate these broken countries and set them upon their legs again, as they should have been set on their legs three years ago. I hope that the great creditor nations of the world will wield their economic influence to secure the disarmament and pacification of Europe and the world, and break down the new artificial tariff barriers that have sprung all over Europe. Then there will be some hope of the recovery at which this Measure is aimed. This Measure is merely scratching the light soil of current finance for a solution of fundamental economic difficulties. Hon. Members opposite who have supported the Government blindly throughout the last three years are, more than any other people in the world, responsible for the present catastrophe. All the speeches that we hear from the other side. What are they? They are mere gramophone records, mere reflections of the speeches which Members like the Noble Lord the Member for Hitchin (Lord R. Cecil) made on coming back from the Peace Conference. [HON. MEMBEES: "Send for him now!"] I have heard no speech from the Government side which it was necessary for him to answer. At a time of natural depression they spent over ÂŁ300,000,000 on military adventures in Iraq, Russia and all over the world, and they reduced this country to such an extent that we have this appalling condition of industry, that we have not the money to provide even the palliatives for the conditions which we have engendered. Instead of devoting ourselves to the economic restoration of Europe we devoted ourselves to the maintenance of hostilities. The Prime Minister now throws up his hands and says, "I could not help it. It is our wicked allies who were entirely responsible." He never mentions that England was the great creditor nation of Europe, and that the breaking up of our own markets has been entirely financed by our own credits. And it is the Government responsible for this that asks for national unity, in support of the very men who are responsible for all the catastrophes that have come upon us. When the Government talks of the necessity for national unity, for that unity in action and for that unanimity in council which invariably lead to salvation, I am reminded of the cases of other misguided communities who were entirely united, but perished, notwithstanding their unity. I am reminded of the case of the Gadarene swine, who, when the devil entered into them by common consent, with complete unanimity in council and unity of action, rushed headlong to their doom in the sea. Let us beware lest, swayed by an analogous inspiration, we unite blindly in a rush to the sea of national bankruptcy. We may or may not agree with this Measure, but we should at least consider whether we will trust to these men the work of providing a remedy for the situation which they have created, during the last three years, when they were working day and night by their blunders and their opportunism to evoke the very situation out of which they ask us to-day to unite in extricating them so that they may find salvation.
May I appeal to the House to come to a decision on the Second Reading now? Nobody thinks that the matter has been imperfectly debated.
There is one point which has not been debated.
The House listened, as it usually does to the Financial Secretary to the Treasury, with that interest which a Minister of his ability deserves, but there is one particular passage in his speech which I think should be cleared up before we go to the Committee stage. The Bill says distinctly in Clause 2 that it is for the purpose of trade facilities, and it is in respect of export transactions between the United Kingdom and any other country whatsoever. The question was asked of the Financial Secretary to the Treasury, and with the exuberance of youth and its attachment to a new office the Under-Secretary rushed in and assured the Financial Secretary that Russia was not to be included within the scope of the Bill. It is because of the atmosphere that surrounded the House on its opening day that I venture to try to extract from the Government some definite statement from the lips of a more important spokesman of the Government than one of its youngest Members who has been apparently involved in the machinations of Brussels. This particular Gentleman, replying to the right hon. Gentleman the Member for Miles Platting (Mr. Clynes) on Tuesday, stated that it was not the intention of the Government to grant any credit to the Government of Russia, and when asked on what grounds that was based he said it was based on an agreement made in March. He said that it was made perfectly clear at the time the trade agreement was signed and constantly in the House since that credits would only be given to Russia if and when debts were acknowledged Several Members asked what debts, and the hon. Member went on to say "All debts properly entered into.' Here is the trade agreement between the British and Russian Governments, signed by the present Chancellor of the Exchequer and by Mr. Russian on behalf of the Russian Government. This trade agreement was signed in order to get back to a normal state; and in it are these words:
"Both parties agree not to impose or maintain any form of blockade against each other."
Further on it says:
"And not to exercise any discrimination against such trade as compared with that carried on with any other foreign country, or to place any impediment in the way of banking, credit, and financial operations for the purpose of such trade."
Apparently the Government have committed themselves to the declaration of this particular Under-Secretary on the basis that debts have not been paid; but if we examine the historical relations between this country and Russia, we shall get some insight into the causes of the decision arrived at in Brussels. I put this as a question to the Government: If it be their decision that they are not to recognise Russia until debts are paid, if the Russians are such undependable people that they cannot be trusted, what is the use of entering into negotiations on their word that some day or other they will pay their debts? It stands on record, not only in this House, but in the records of the greatest of the papers of the world, what exactly is the attitude of the Soviet Government of Russia towards its legitimate debts. Everyone knows that before 1914 Russia was an autocracy. Everyone knows that in 1905 there was a revolution. Most people know that as a result of that revolution in the spring of 1905, the then Tsar was forced to grant a constitution, and that that was followed by an appeal in the name of the Tsar for loans from all the financiers of Western Europe. Those loans were forthcoming, and it is just as well to quote some of the best friends of the present Government to substantiate what I say. This is a quotation from the "Times" of 1st February, 1906, and it-gives the words of M. Clemenceau. Writing in the "Aurore," M. Clemenceau warned the French against any participation in Russian loans whilst the internal condition of affairs in Russia remained unsettled, and he went on to say that having furnished the Tsar with the financial resources which were destined to lead to his defeat abroad, "it remains for us to supply him with financial resources destined to secure him his victory over his own subjects. Here is an extract from the London "Times" of 10th April of the same year. The "Times" correspondent wrote:
"The opposition organs continue their campaign against the collection of a foreign loan before the Duma meets. A host of arguments is adduced in support of their contention, but all amounts to this, that they are afraid the Government, having secured a large sum of money, would try to terrorise the Duma, just as they terrorised the electors. The Russian Press has, unfortunately, too deep and too lasting a mistrust of its Government."
Now, it is commonly known that that foreign loan was successful, and that the constitution which was granted owing to the pressure of the Russian people was dissolved by the Tsar within 10 days of that foreign loan being consummated. The "Times" then commented upon the situation as follows:
"The Russian Government's arbitrary step, indeed, justifies only too completely those Russian reformers who besought the friends of constitutional liberty in the West not to loan more money to the autocracy. The Russian Government obtained their loan by what now looks uncommonly like false pretences, but they cannot live on it for ever."
These are some of the reasons why the question of the Russian debts should not enter into the conditions of giving credits to Russia at this particular hour. The Leader of the British Parliament speaking from that Bench referred in moving terms to the destruction of the Duma by the Tsar and the men who were driven from their posts as the elected representatives of the people, called upon the Russian people not to recognise the debts and warned the financiers of the West that some day or other these debts would be repudiated by the Russian people. We have now reached that state of affairs. A trade agreement has been signed, in which no word occurs about debt and now, when unemployment, the world over, is accentuated by one of the most awful famines in history, there is put forward as an excuse for withholding these credits in the case of Russia, a statement made on the authority of an Under-Secretary, that these debts must be recognised. I want to know, before we go in to Committee, in what part of the trade agreement it is specifically stated that before credits can be granted the debts must be recognised? If this Bill for trade facilities includes the words "for any country whatsoever," on what ground do you rule out one country which stands more in need than any other? I say "stands in need" advisedly, because, if you cast aside your prejudices for a moment and only look at the destruction of the means of production, which applies to Russia just as to Poland or Austria or any of the countries about which the Financial Secretary to the Treasury waxed so eloquent, you will see that the cause of the complete breakdown of transport in Russia is directly traceable to that utter breakdown of the means of production. In asking these questions I am voicing the desire of not a few Members of this House. I am aware a great many Members are blindly hostile to the Communist Government. As one who has spoken against the Communist theory of government, and who will continue to speak against it, and as one who saw it at close quarters during the Recess, I assert here and now, as solemnly as I can, that the attitude of blind and unreasoning hostility will do more to perpetuate that system of government than anything else. If you can, display a measure of generosity, which is good business, because you can only supply these people or their Government with the very things to put them on their feet by putting people to work, and by doing that you preserve their self-respect, that sense of uprightness which disappears under compulsory idleness week after week and month after month. [HON. MEMBERS: "Divide!"] You people should take this into consideration instead of lightly coming in after dinner with all the exuberance of what follows on a good dinner, and claiming the right to divide when some of you have not sat in the House for ten consecutive minutes. The Government will have to pay the penalty of this shortsightedness; this attitude of vicious hostility to 140,000,000 of people continues simply because they are governed by a Government that are not guided by the ethics of the people whom you represent so well in this House.
Do the Government not intend to reply to the very able speech of the hon. Member for Dartford (Mr. Mills)? I see the hon. and gallant Member the Parliamentary Secretary to the Overseas Trade Department is in his place, and will he inform us, as he was the oracle appealed to by the Financial Secretary to the Treasury, why, when the Bill lays it down that the provisions of the Overseas Trade Credit and Insurance Act, 1920, "shall" be extended to any other country whatsoever, ho puts it into the mouth of his colleague to reply that this Clause is permissive. He will explain, perhaps, why he disagrees with the Parliamentary draftsman on that point, or whether it is intended in Committee to alter the second part of the Bill, and particularly the word "shall" in Clause 2. Why is it that Russia is not to be included in the second part of the Bill, dealing with export credits? I interrupted the Financial Secretary to the Treasury, and he simply said the answer was in the negative and refused any explanation. In view of the importance of this matter to employment, I do not think that is treating the House with respect. This is an important admission from the Government about Russia. It has been dragged from them like drawing teeth, and we ought to hear some reasons that will satisfy the House. This matter is not altogether trivial. The Prime Minister, speaking last Wednesday, said, in regard to Russia, that the amount of trade that had been done up to date was from ÂŁ3,000,000 to ÂŁ4,000,000, and he added that it was not easy to get statistics, as that did not include trade done indirectly through the Baltic ports. As a matter of fact, the Russians state that they have purchased from us, in spite of the coal stoppage, goods to the value of ÂŁ7,000,000. The Prime Minister went on to say that the trade done from last March was at the rate of ÂŁ5,000,000 to ÂŁ6,000,000 a year. That is a contribution of value. Every little helps, and if we can sell to Russia at that rate to-day, without credits of any sort, what opening is there not for an export credit scheme as laid down in this Bill?
There is one other point I would like to refer to. The extraordinary thing to-day is that we are defending a Bill in this House, which I am sorry to say the Labour party are going to support, quite blindly as I consider, which, in the words of the Financial Secretary to the Treasury, is only going to be of benefit to firms whose credit is of the highest and whose position is the firmest in the financial world. In other words, this is a Bill for providing loans—I am now dealing with the first portion of the Bill—to firms which do not possibly need them. Others are not to receive assistance, if I understand what the Financial Secretary said. That is very extraordinary, and I think the Labour party have been a little too hasty in deciding to support the Second Reading of the Bill. The hon. Member for Boston (Mr. Royce) perhaps does not appreciate the fact that this Bill is going to be used for political purposes.
I do not know why the hon. and gallant Member addresses me. I made no utterance.
I apologise to the hon. Member and withdraw at once. This Bill is going to be used for political purposes, and for the ridiculous policy of hostility to Russia. With great difficulty we have drawn that to-night from the spokesman of the Government, and for that reason alone I should have thought that the Labour party would have voted against the Bill. If I can get any support, I shall certainly vote against it, especially as we can get no reply from the Government on this very important matter. The extraordinary thing is that at this moment there is plenty of money in this country to invest, and the only thing that is required is some confidence in the minds of investors. What has happened is this. The financial credit that flows in normal times was flooded and overflowed its banks. People who had not money before, or were in a very small way of business, were consequently able to get very large sums into their hands. When the slump came, however, these people very soon lost most of that money. The river came back to its normal bed, and is not flowing at all. It is simply a succession of pools. What is required is to get the pools communicating with each other, and the stream running. I do not know if my analogy is a good one. There is any amount of money, but it has again got into a few hands, and it is simply a question now of finding a profitable investment for it. Looking for the key to the commercial revival of Europe, we come back once more to the greatest potential market for our goods, namely, Russia in Europe, and Russia in Asia. Countries like Austria and Poland have manufactures of their own. Poland has textile mills, and when it can get cotton and so on, it will make goods cheaper than ours. Russia, however, is not a manufacturing country, but an agricultural country with immense potential riches, and if we could only restore trade with it our troubles would be over.
I must recall to the House the way in which we can get the money that is available for investment into use once more. The plan which I think will have to be followed is a combined effort by this country and Germany to develop the Russian market. I do not think we can do it without Germany. I am perfectly certain Germany cannot do it without us. Germany needs our political assistance, prestige, and capital. On the other hand, she has a knowledge of the Russian market, and there is the skill of her commercial men who used to deal with Russia. The language difficulty is not so great there because so many Russians speak German. There, I believe, is the key to the present very difficult situation. If we can supply credits to-day either by Government action or by a big syndicate of financiers of this country to finance a working arrangement with Germany and to develop and assist Russia I believe we should just save the situation. After listening to the Debates during the last five days in the House, and at other times, I must say the situation presented to the House is extremely gloomy. This puny Bill, with its miserable ÂŁ25,000,000, which is only going to be given to firms that do not need an extension of the export credits scheme, and excepts the greatest potential market of Russia, is utterly useless for the purpose. On the top of that my hon. Friends on these benches say they are going to support the Second Reading! I hope that they will take a different view, and that unless we can get some radical improvements in the Bill, and in particular some real explanation of the Russian situation, they will, at any rate, vote against the Third Reading.
I desire to draw the attention of the House to the fact—
rose in his place , and claimed to move, "That the Question be now put;" but Mr. Speaker withheld his assent, and declined then to put that Question.
I desire to say that we have had placed before us a Bill which says very definitely that
"the Overseas Trade (Credits and Insurance) Act, 1920, …. as amended, …. shall be extended so as to authorize the granting of credits and the giving of guarantees in respect of export transactions between the United Kingdom and any other country whatsoever."
We as a party have discussed this Bill, and if the Government have decided upon a policy which altogether alters the policy set forth in the Bill—[An HON. MEMBER: "It does not!"]—Well what is the position? Is it a fact that Russia is excluded by the Bill?
Not by the terms of the Bill!
If so, on what grounds is it excluded? This House has a right to know whether or not the Government is reversing the policy set forth in the Bill. The right hon. Gentleman says that it does not exclude Russia, that the Bill does not say so. We have been told from the benches opposite—
You have not been listening!
It is the right hon. Gentleman who has not been listening. The Financial Secretary of the Treasury was asked if Russia was excluded from this Bill, and there is a vagueness about the matter—
You do not know the difference between "from" and "by."
It was very vague at first. The right hon. Gentleman who conducted negotiations with regard to this matter was very definite that Russia was excluded. [HON. MEMBERS: "No!"] If the Chancellor of the Exchequer tells us that it is not intended to exclude Russia from the provisions of this Bill, then we are satisfied, but we shall want that declaration from him submitted to the House.
Question, "That the Bill be now read a Second time," put, and agreed to.
Bill read a Second time, and committed to a Committee of the Whole House for To-morrow.— [Colonel Leslie Wilson.]
Unemployed Workers' Dependants (Temporary Provision) [Money]
Resolution reported,
"That, for the purpose of any Act of the present Session to make temporary provision for the payment of grants to unemployed workers towards the maintenance of their wives and dependent children, it is expedient to authorise the payment out of moneys provided by Parliament of—
Resolution read a Second time.
Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
There is a question which I raised last night and which the Minister of Labour did not reply to, that is the extraordinary anomaly of the proposed maintenance allowance for wives. The expression "wife" includes a woman who is living with a man as his wife and is not married. It seems extraordinary that—
That is not a matter which can be raised now. There is nothing relating to that point in the Money Resolution.
Should I not be in order in raising this point on the ground of the scope of the finance of the Bill. The question of the "unmarried wife" as it has been called extends the scope of the Measure.
That point will arise specifically on a Clause in the Bill tomorrow.
If we do not get an explanation now shall we not be precluded to-morrow from in any way extending the Bill by the terms of this Financial Resolution? If we do not raise the matter now it seems to me that if we attempt to amend the Bill in the direction I have outlined we should be told that it would be an extra expense and would be out of order.
That will be no more so to-morrow than to-day.
Question put, and agreed to.
Nurses Registration (Scotland) Act, 1919 (Draft Rules)
I beg to move,
I feel that so far as the certificated nurses are concerned the general sense of the House was expressed at the time when the Act was passed. If we are to have two separate registers for fever nurses and nurses in general hospitals in Scotland you are going to establish a spirit of envy between the two classes of hospital in Scotland which will not tend to assist nursing in general. It must be remembered that infectious diseases hospitals and fever nurses are both in the majority in Scotland, and the other class of nurse is in the minority. A good deal of nursing done in infectious diseases hospitals is among children who are unable to look after their own interests, and it is therefore most desirable that the nurses engaged in nursing them should be drawn from the best class, and yet because the General Register gives a wider scope for employment than the Supplementary Register you will get the best class of nurses gravitating to the general hospitals and the General Register, and those remaining will gravitate to the local authorities' hospitals so that you will have a tremendous difficulty in maintaining the standard of nursing in those hospitals throughout Scotland. That will be detrimental to the nursing service in general, and particularly to the nursing in infectious diseases hospitals. I know the Parliamentary Secretary to the Scottish Board of Health has a sympathetic attitude on this question. If he cannot meet us as far as the official training of nurses is concerned he may do so in regard to the certificated nurses. I maintain that we had a definite promise in this House at the time the Act was passed that they should be placed on the General Register if they held a certificate from either the Local Government Board or the Scottish Board of Health.
I BEG to second the Motion.
Mr. Macquisten and I desire to enter a protest against the legality of the Supplementary Register. The nurses do not want to take any hostile action unless they are driven to it; they wish to act in a constitutional way. I would point, out to the Parliamentary Secretary for Health that just as in the old days it was said, "Once a miner always a miner," a man being tied to the coal mine all his life: so nurses under this system will always be tied to fever hospitals, and will never get away from them. Once a nurse gets that qualification it will be impossible for her to get into the general hospital without beginning her career all over again. She has the same training as the general nurse, the same qualifications, and she has the fever training in addition. She might, after serving for a time in a fever hospital, wish to take up general nursing. This classification excludes such nurses and, as my hon. Friend has said, it will cause the greatest difficulty to local authorities in carrying on and in getting the right class of nurse. There is no substance or justification in it, and it is not fair as between the nursing profession as a whole. I, therefore, cordially support the Motion.
I think one point, and the governing point, has not been mentioned by either of the two previous speakers. It is surely this, that we should have, so far as is possible, reciprocity with England, so as to secure uniformity throughout these islands. The nurses who are trained in Scotland do not travel out of that country, as many of the other professional people do, and it is of far more importance to us that we should get our staff on a basis with England than that we should strive after certain impossible ideals in the country of Scotland itself. It is all very well to say that this is not just and right as regards the fever nurses. After all, we have the position as it stands at present, which is that there is a Scottish Register and an English Register. I deeply deplore that. It is an interesting sidelight on Scottish home rule that when you have secured complete autonomy politically you may find a big economic drag from the southern half of these islands based on this difference. The English market is worth more to the Scottish nurses than the Scottish market is to the English nurses. The English, therefore, can dictate their own terms. They have got the whip hand and they are exercising it just now. We cannot force them, all we can do is to reason with them. If we make separate rules for Scotland from those they have in England they will not recognise our Register. The result of that will be that we may as well have no Scottish Register. We shall not secure any additional advantages for our own nurses if we, at this time, present this Prayer and reject these Rules. There will be for a while no Register in Scotland, and after that an inferior Register, because it will not be recognised by England, and our nurses will go on the English Register, and all our efforts will be of no avail.
The Scottish nurses recognise that. I have here two communications from the Scottish nurses themselves. The first is from the nurses at the Glasgow Royal Infirmary, where I myself received my professional training, and which is an infirmary which stands second to none in Great Britain.
Second in the United Kingdom?
I said second to none. There are many equal to it, but is not inferior to any hospital in the United Kingdom. These 237 nurses passed this Resolution:
"That we, nurses trained and in training in Glasgow Royal Infirmary, approve of the regulations drawn up by the General Nursing Council for Scotland for the admission of existing nurses to the register, as already laid before Parliament, and we beg the Secretary for Scotland to resist any alterations in these regulations or delay in their sanction by Parliament."
They are a privileged party.
These are 230 nurses. The Scottish Nurses' Association also, at its annual meeting, passed a similar Resolution.
What is the registered address of the Association of Scottish Nurses?
Glasgow.
Glasgow, yes.
As a Member for the West of Scotland I am quoting evidence that has been sent to me from the West of Scotland.
Ex-parte .
I am quoting evidence, of course, which is ex parte , since it is evidence from parties who are interested in getting a register for Scotland. It is evidence from Scottish nurses.
Those are people in the West.
I have no doubt that similar resolutions have been or will be passed by the nurses in the Edinburgh hospitals; it is simply begging the question to suggest that they will not. The main point is that, although we would have wished that the Scottish local authorities should take a somewhat higher place in the register than they do now, we consider that it is far more important to get the general registers into correspondence, and subsequently to proceed to improve upon that, than to start now by throwing them into chaos and having a register in England and none in Scotland; and that the fever nurses will be helped and not hindered by admitting for the moment this temporary disqualification of being placed on a subordinate part of the register, and then starting to improve it from there, so as to get the advantage of the big English market, which Scotland, since she runs her professional training for an export trade, must always consider as of paramount importance in any rules and regulations.
I am surprised at the attitude adopted by my hon. and gallant Friend on this matter. He has said nothing whatever as to the merits of the register which it is proposed to set up, but has advanced two arguments in favour of a proposal which we are attacking. The first is that it is done in England, and the second is that a number of nurses in the Western Infirmary, Glasgow, who are put in a privileged position by this proposal, are in favour of it, as one would quite expect them to be. One would expect everyone put in a privileged position by any regulation to be in favour of it, but that does not recommend the general proposition on its merits. Why should fever nurses be put in a subordinate position as compared with other nurses? Why should they be put on a supplementary register, and not be allowed to share in the benefits of the general register? It is suggested that they have not had the experience, perhaps, that is secured by other nurses, like surgical or medical or maternity nurses; but that is equally true of those other nurses. A nurse who has devoted all her time to maternity nursing has not secured experience in the nursing of infectious diseases, and the same is true of medical and of surgical nurses.
I beg my hon. Friend's pardon, but that is not so. Those nurses go through a four years' nursing training, which includes a full course of training in medical and surgical work; but fever nurses do not receive a training in medicine and surgery that is in any way comparable with that which the others receive. Their training is much more specialised, and they get no such training as nurses trained in a big general hospital.
I venture to suggest, in spite of what my hon. and gallant Friend says, that the nurses trained in the Western Infirmary have not the experience in the nursing of infectious diseases which the nurses have who have been placed on this supplementary register. If it be desired to have supplementary registers, then, instead of a general register, it should be a case of supplementary registers all round, and there should be one for infectious diseases, one for materity, one for surgical, and one for general medical nurses.
12.0 M.
The Regulations as they stand at present single out one class of nurses, who are put in a subordinate and inferior position. The effect of this with regard to the position of the infectious diseases hospitals, which are run by the local authorities, will be that they will not be able to secure a similar class of nurses as those who are secured for the other hospitals. The nurses will all want to be placed on the general register, and there will be a preference for the other hospitals, and the infectious diseases hospitals will only secure inferior persons. That puts a serious burden not only upon the nurses but upon the local authorities which run the infectious diseases hospitals. I should like to know what there is to justify this, except the fact that in England they have a different system. In this matter in the past we have been able to set our own standard in Scotland, and we have found that our nurses have been in demand all over England. We have set a similar standard in regard to educational teaching, and we have found that the teachers trained in Scotland have been in demand all over England. I do not think we shall suffer in the slightest degree by setting our own standard in this matter, and I appeal to the Minister of Health not simply slavishly to follow the English example, but to follow the Scottish precedents, and our own line of national development.
I wish to give general support to what the hon. and gallant Member for Lanark (Captain Elliot) has said. I am surprised at the vehemence of the Glasgow Members. It is extra- ordinary how they act together in matters of this kind. We were discussing an educational matter not long ago, and they were thoroughly beaten. I hope they will be beaten to-night, and that the Minister of Health will not give way. I am a past chairman of one of the largest hospitals in Scotland, and I have personal knowledge of the feelings of the nurses in regard to this matter. There is not the slightest desire on the part of any one nurse that I have seen, or of any matron I have interviewed, to allow the fever nurses to come within the scope of this part of the Bill. Moreover, the nursing council of Scotland has had this question very fully before them; they have discussed all the pros and cons of it, and they finally decided that the supplementary part of the register was all that was required so far as the fever nurses were concerned. I join issue with the hon. Member who spoke first, with regard to its being the original intention that fever nurses should be included in the general register. With all respect, I do not believe that for a moment. I think it was always the intention that fever nurses should be put in a category by themselves. General nurses require four years' training. Why should the same privilege be given to the fever nurses who have a very much shorter term of training, and whose training is not so general? Why should the fever nurses be put on the general register, when provision is made for them in the Supplementary part of the Bill? I hope the Minister of Health will not listen to the proposal that is made by my hon. Friends, and that he will leave the register as the Nursing Council for Scotland desire it. Surely they know what is necessary for nursing.
The question as to whether the fever nurses should be placed on the general part of the register or on the supplementary part designated in the Rules now before the House, has been the subject of long consideration and discussion by the responsible authorities, namely, the English, Irish and Scottish General Nursing Councils on the one hand, and the Ministry of Health, the Irish Local Government Board, and the Scottish Board of Health on the other. Under their respective Statutes, the General Nursing Councils of the three countries are required to con- sult each other with a view to securing a uniform standard of qualification in all parts of the United Kingdom. Further, the Statutes contain special provisions requiring rules to be made for enabling the nurses registered in one country to obtain admission to the register of the other two countries. This obligation to provide for reciprocal registration is reasonably held to imply that the registers of the three countries shall, in all essentials, be similar. It was finally agreed that the three registers should contain the parts now specified in the Rules lying upon the Table of the House, and, in particular, that there should be a supplementary part for nurses trained in infectious diseases hospitals, known shortly as fever nurses. While it would have been quite competent for the general nursing councils to place fever nurses on the general part of the register, and while under the special powers of the Scottish Act the Scottish Council, with the approval of the Scottish Board of Health, would have been prepared to place on the general part of the register all such nurses as had passed the special examination of the Board of Health, it was found that neither the English Council nor the Irish Council would assent to reciprocal registration, part for part, on those terms.
In these circumstances, it was necessary for the Board to consider whether the advantages of reciprocal registration by the three countries outweighed the disadvantages of establishing a supplementary part for fever nurses. On the whole, it was concluded that, from all standpoints, the advantages of reciprocity were paramount. The rules were adjusted accordingly; but in order not to delay the process of registration the rules as to reciprocity have been omitted. It is, however, understood that as the Scottish Council has accepted, part for part, the same divisions of the Register as the English and Irish Councils, and has done everything in its power to secure uniformity of standard, there is no further obstacle to the establishing of reciprocal registration, part for part, among the three countries.
Meanwhile, my right hon. Friend the Secretary for Scotland, as President of the Board, took occasion to ascertain the views alike of the local authorities, of the Scottish Nursing Council, and of the fever nurses themselves. On the 15th September last, he discussed the question with a deputation representing all the Scottish local authorities. A week ago he heard the latest views of the Scottish General Nursing Council. In the interval, he caused inquiries to be made of the fever nurses at the chief Scottish hospitals for infectious disease. Accordingly, in coming to the decision that he would not propose to vary the rules as now submitted to Parliament, he had before him the views of all the parties concerned. Briefly, the position is that in the view of the Board, and in the view of my right hon. Friend, reciprocity of registration is the ruling consideration in the interests of the whole body of nurses in Scotland.
That is not the view of the fever nurses.
The view of the fever nurses is not nearly so unanimous as my hon. Friend would have the House believe. Many of the fever nurses have not only a qualification as fever nurses, but a further qualification for general nursing, and among those who hold that double qualification there is certainly a very strong feeling against putting those who only hold one qualification on the same platform with themselves. It is right to point out that the Rules now before the House deal with existing nurses alone. When the rules for the registration of future nurses are framed the councils will, no doubt, consider whether they cannot devise a curriculum that will be sufficiently broad to enable every nurse to qualify for admission to the general part of the register. From the views expressed to the Secretary for Scotland by the representatives of the Scottish Council, it is clear that it should now be possible for all nurses to obtain within a period of four, or at most five years, an adequate training not only in the nursing of infectious diseases, including pulmonary and non-pulmonary tuberculosis, but also in the nursing of medical, surgical, and gynæcological cases. The Scottish Board of Health, when the rules for future nurses are submitted for their approval, will keep in view the eminent desirability of securing for all nurses a training sufficiently wide to entitle them to registration on the general part of the register. At the present time it must be admitted that the curricula of the general hospitals suffer by the exclusion of the infectious diseases, and, for the present, the curricula of the local authorities' hospitals suffer from the exclusion of surgical cases. But with the present rapid readjustment of hospital and medical administration, I am satisfied that the systems of training now available will ere long be displaced in favour of a combined training. The local authorities who are responsible for the immensely important departments of infectious diseases, including pulmonary and non-pulmonary tuberculosis, as well as venereal disease, pneumonia, cerebro-spinal fever and many others, may rest assured that the Board will do everything in their power to secure a comprehensive curriculum of education for all nurses. This will insure that the local authorities will be able to avail themselves of the highest quality of trained nurses for the very important medical services for which they are responsible.
If a fever nurse who has served three years in a fever hospital serves three years in a general hospital, is it possible for her then to receive the general certificate?
indicated assent .
Question put, and negatived.
The remaining Orders were read, and postponed .
It being after half-past Eleven of the Clock , Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order .
Adjourned at Twelve minutes after Twelve o'clock.