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Commons Chamber

Volume 147: debated on Thursday 27 October 1921

House of Commons

Thursday, October 27, 1921

The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

Private Business

Church of Scotland (General Trustees) Order Confirmation Bill,

Considered; to be read the Third time.

Oral Answers to Questions

Ex-Service Men

Mental Cases (Treatment Allowances)

asked the Minister of Pensions the number of ex-service men at present confined in lunatic asylums who are in receipt of treatment allowances?

The number of ex-service men classified as service patients in respect of whom treatment allowances are paid or credited is 6,435.

Is my hon. and gallant Friend aware that in many curable cases the treatment allowance upon which the dependants of these men rely is given subject to the condition that they enter a lunatic asylum, with the result that in many cases they are rendered permanently insane, and will my hon. and gallant Friend render his practical sympathy to a vigorous movement that is on foot to redeem these unfortunate men from the positive torture of lunatic asylums?

Perhaps my hon. and gallant Friend will put down a question on that quite different point. I cannot accept the word "torture" in his statement. We must not forget the enormous amount of trouble and care which the doctors and others are taking on behalf of those who unfortunately have suffered from the effects of the War.

Does not my hon. and gallant Friend accept the position that in regard to a curable case it is torture?

Pensions Issue Office

asked the Chancellor of the Exchequer whether he is aware that the Pensions Issue Office is staffed by women; that the total number of women employed under the authority of the Ministry of Pensions is approximately 12,000; and that at least 8,000 of these women could be replaced by ex-service men; if, in view of the large number of unemployed ex-service men and the promises given by the Government when these men entered His Majesty's service to fight for this country, he will give immediate and definite instructions that ex-service men shall be employed wherever possible in all Government Departments in the place of women; and whether, in order to ensure these instructions being carried out, he will arrange for the Joint Substitution Board to be reconstructed, with representation from ex-service men's associations, and that it be granted full executive power (with the Minister of Labour as its chairman) to enforce all possible substitution in the different Departments?

I understand that the Pensions Issue Office is at present staffed by women; that the total number of women employed in the Ministry of Pensions is approximately 12,000; that of these one-half are engaged on non-clerical or women's duties such as those of hospital staff, typists, or cleaners; and that the number, 6,200, employed on clerical duties represents a reduction of 1,700 on the number so employed in October, 1920, and is being rapidly further reduced in accordance with the recommendation in paragraph 19 of the Third Report of Lord Lytton's Committee. It is the policy of His Majesty's Government that ex-service men should be employed, wherever possible, in all Government Departments in place of non-service temporary staff, whether men or women. Definite instructions to that effect have been given to all Departments, and I am satisfied that they are being carried out. The responsibility for carrying out the policy of the Government in any individual Department must, however, continue to be that of the Ministerial head of that Department, and I am not prepared to adopt the suggestion in the last part of the question.

May I ask the Leader of the House if the terms of reference of the Select Committee which he stated yesterday he proposed to appoint will include an inquiry into the whole question of the employment of non-service and ex-service people in Government Departments?

No, Sir. The Committee which I invited the House yesterday to appoint was a Committee to consider the question of the continued employment of conscientious objectors, and I think it would be undesirable to extend that inquiry beyond the point for which it is specifically asked, and on which a decision is sought as soon as possible.

Will the Financial Secretary carry out a special inquiry into the appointments made on the staff of the Disposal Board during the last fortnight, and see whether his orders have actually been carried out?

As I have previously assured other hon. Members, in reply to similar questions, I have inquired, and will most particularly continue to inquire, into any circumstances of the sort suggested by the Noble Lord, in connection with the administration of the principles to which I have referred—subject, of course, to there being primâ facie a matter for inquiry.

Does the hon. Gentleman intend to carry out the specific recommendation of the Lytton Committee, that not more than 30 per cent, of the whole staff of the Pensions Ministry shall be women, and by what date?

I think that a question applying to a particular Department should be put on the Paper.

On a point of Order. The hon. Gentleman referred in detail to the recommendations of the Lytton Committee in regard to the Pensions Ministry, and it is arising out of that answer that I put my specific question.

Is the hon. Gentleman aware that the Pensions Issue Office is the least efficient branch of the Pensions Ministry, and is that due to this employment of women?

Naval and Military Pensions and Grants

Royal Berks Regiment (Mr. C. W. Keeves)

asked the Minister of Pensions whether he will inquire into the case of Mr. C. W. Keeves, of 29, Osborne Street, Wolverton, late private, No. 220,373, 1st Battalion Royal Berks, whose pension expires on 16th November, 1921; is he aware that Mr. Keeves is still suffering from the effects of his wound, and that only on the 17th October, 1921, his doctor certified in writing that he has an old wound of the left thigh which interferes with the function of the limb, and gives rise to neuralgic pains in the knee joint; on account of this condition Mr. Keeves has lost much time and cannot continue regular work; and will he, in view of this, cause the weekly pension to be continued?

The last Medical Board, held in September, 1920, found the remaining disablement to be less than 20 per cent., and a final allowance was awarded which will expire on the date stated. If Mr. Keeves considers that the condition of his disability has become worse, he may apply through his Local War Pensions Committee to have his case reviewed.

What redress has Mr. Keeves got if his pension stops on 16th November and his appeal cannot possibly be heard for three, four, five, or six months? Will my hon. and gallant Friend inquire into this case, because the local doctor certifies that this man cannot work?

The Ministry have acted on the finding of the Medical Board, and the man has had a perfectly fair medical examination.

May I ask whether this is one more in the long line of cases where the Ministry of Pensions override the knowledge and the certificate of the local doctor, who not only knows the man now but knew him before the War?

No, it is not the case that we over-ride the finding of any doctor, but we go by the proper Medical Board constituted for the purpose, and a full right of appeal exists. My hon. and gallant Friend is not justified in his statement.

Williamson Committee (Report)

asked the Minister of Pensions if he can state the reason of the delay in the publication of the Report of the Williamson Committee; whether he has agreed to the recommendations; and whether they have been sanctioned by the Treasury?

The Report of the Williamson Committee is in the press and will be published immediately. I hope to send my hon. and gallant Friend a copy in the course of a few days. My right hon. Friend is in agreement with the Report, the value of which he much appreciates. Effect is being given to its recommendations.

Arising out of that reply, for which I am much obliged, may I ask my hon. and gallant Friend whether, if the Ministry decide to supply the new limb recommended in that Report, he will afford hon. Members an opportunity of seeing the limb?

We shall be delighted to give hon. Members an opportunity of seeing the new limb.

Government Staffs

Ministry of Pensions, Acton

asked the Minister of Pensions whether he is aware that the large incursion of the pensions staff into the borough of Acton is making housing conditions a greater problem than ever; and, seeing that the number to be transferred is by no means yet completed, will he endeavour to arrange for effective transport facilities for those who so desire it?

The provision of adequate transport facilities for the staff in process of transfer to the new building at Acton has not been overlooked. The traffic companies concerned have promised to augment their services as necessity arises, and they are kept informed of the numbers of staff transferred.

Has the hon. and gallant Gentleman's attention been called to the proposals made yesterday by Lord Ashfield, some of which, if carried out, would do much to mitigate the difficulties in this particular case?

Conscientious Objectors

asked the Prime Minister whether, in view of the strong feeling shown by Members of this House, he will consider the advisability of introducing legislation whereby the anomaly of conscientious objectors being employed by the Civil Service whilst men who have fought for their country are out of work may cease?

asked the Prime Minister whether, having regard to the more enlightened views now felt by the nation as to conscientious objectors in comparison with the views entertained by Parliament in 1916, he will consider introducing a Bill to provide that no Department of the State shall dismiss ex-service employés so long as men who avoided service during the War remain in its employment?

I would refer my hon. and gallant Friends to the answer given by the Leader of the House to questions on this subject yesterday.

Ireland

Munitions (Importation)

asked the Chief Secretary for Ireland on what date and by whose instructions the auxiliary police who were employed in searching for arms and munitions on ships arriving at Irish ports were withdrawn, and when these police commenced again to operate in these ports; whether during the time that these police were withdrawn any searches for arms and munitions were made on ships arriving at Irish ports; and whether he will state approximately what number of Thomson machine-guns and other arms have been imported into Ireland during the truce for the use of the Irish Republican Army?

The search by auxiliary police of ships entering Irish ports, six in number, was suspended on 11th July when the truce came into operation. Owing to persistent rumours of the continued importation of arms it was resumed on 18th September. These steps were taken by direction of the Government. The search of vessels by His Majesty's Customs has continued without intermission, and is, of course, still going on. The Government have no proof of any landing of arms having been successfully effected during the truce. The last part of the question, therefore, does not arise.

When these auxiliary police were withdrawn, who made the searches of ships arriving in Ireland with arms intended for the Republican Army?

I have answered that. The proper persons to search ships in Ireland are the members of His Majesty's Customs service; they have always been responsible for that particular work, and they have been and are now reinforced, if required, by all the forces of the Crown in Ireland.

Is it not a fact that these Customs officials are known to be, many of them, Sinn Feiners, and that it is absolutely necessary to reinforce them by the police? [An HON. MEMBER: "They are officers of the Crown."] We do not want English soldiers murdered, if you do.

What is the reason for stopping the searches of these vessels by the persons who were authorised to do so, namely, the police, for nearly two months from 11th July onwards?

As soon as the truce was signed—[HON. MEMBERS: "It was not signed!"]—as soon as the truce was agreed to, there was immediately a cessation of a great deal of the work that had gone on up to that date. For instance, the whole Army resumed its peacetime training, and was put then, and is now, on the same basis as the Army has always been. Fifty per cent, of the Auxiliary Force were at once given leave, because the Government considered that under the terms of the truce it was justified in taking that step. Among these operations there were withdrawn at that moment the operations of certain Auxiliary Police in six ports in Ireland, but it did not interfere, and has not interfered, with the system of continuous searching of vessels coming to Ireland.

asked the Chief Secretary whether his attention has been called to the allegation that officers in the West of Ireland reported that arms were being landed, and were informed in reply that to interfere with the landing of arms would be a breach of the truce, and they were consequently compelled to remain inactive while hundreds of rifles were being openly landed in their presence and carried off into the interior of the country; and will he have inquiries made into the matter?

Yes, Sir. My attention has been called to this allegation and I adhere to the statement which I made in this House last Thursday. The instructions issued to the police throughout Ireland directed them, in accordance with the terms of the truce, to discontinue the raids and searches which have been carried out prior to 11th July. There was, however, nothing in these instructions to debar the police from taking immediate action in the ordinary course of their duty on receipt of information of any attempts on the part of Sinn Fein to import arms in contravention of the truce. The suggestion that the police remained inactive while hundreds, or indeed any, rifles were being openly landed is utterly devoid of foundation.

Sinn Fein Courts

asked the Chief Secretary whether his attention has been called to the printed orders issued this year by Dail Eireann for the constitution, jurisdiction, and working of the following republican courts in Ireland to supersede the High Court of Justice, the county courts, and the petty sessions, namely, a supreme court in Dublin, district courts (of which two out of five members may be priests), and parish courts (of which one out of three members may be a priest); whether these orders provide that every member of these courts shall take an oath of allegiance to the Irish Republic and swear that he will support and defend the Irish Republic against all enemies, foreign and domestic, and further provide for compelling the attendance of witnesses, for arresting and bringing persons before the courts, and for the enforcement of the orders of the courts; whether these courts have been repeatedly held before and since the truce, and British subjects have been intimidated from having recourse to the King s courts and have been forced to obey the orders of the republican courts; and whether any persons have been brought to justice either before or since the truce for taking part in these illegalities?

asked the Chief Secretary whether he is aware of any illegal Sinn Fein courts having been held in Ireland since the so-called truce; if so, how many such instances he knows of; and what action he has taken in regard to them?

asked the Chief Secretary whether, when Sinn Fein courts are established, they are opened by a proclamation denouncing British Law and announcing that the proceedings would be conducted according to the Code Napoleon and the old Brehon laws; and whether the Government have tolerated, and intend further to tolerate, the holding of such courts in defiance of the King's courts and British Law?

My attention has been drawn to the document referred to by the hon. and learned Member for York (Sir J. Butcher). The number of courts of which the police have received complaint is 94. I am not in a position to give the House any information as to the procedure actually followed in these so-called courts. As I have stated, the strongest representations have been made to Sinn Fein in the matter. I would refer in this connection to my replies to questions on the subject last Thursday and yesterday. In the most recent case brought to notice I gave the House an assurance that the Court in question—one summoned to meet in Mullingar on the following day—would not be held. The action taken on that occasion was effective and will be repeated if necessary.

Is the right hon. Gentleman aware that by the printed document issued by the Irish Republican Army or the Irish Republic as to the constitution of these courts, a code of law is laid down to be administered by these courts entirely different from the British code?

Will the right hon. Gentleman be good enough to answer the second part of my question, as to whether the Government have tolerated, and intend further to tolerate, the holding of such courts in defiance of the King's Courts and British law?

The Government have not tolerated, and do not intend to tolerate, the holding of such courts, in defiance of British law. Before the truce orders had gone to the police to disperse these courts, and they were dispersed, but during the period of truce an order to the police to go and disperse these courts might mean the shedding of blood, and I did not feel justified in dispersing these courts in that way.

Did not the right hon. Gentleman state in this House, before this truce, that in many cases these courts had done good work in settling land disputes, and is the whole of that work, which is the only means of protecting the Unionist landowners, to be thrown aside?

Then are we to understand from the right hon. Gentleman's answer that, during the so-called truce, the Government have been tolerating the holding of these courts?

Will the right hon. Gentleman answer the last part of my question, namely, whether any persons have been brought to justice either before or since the truce for taking part in these illegalities?

Before the truce numbers of persons were arrested and a larger number dispersed. These courts in Ireland, although not in this House, are looked upon much less seriously than some hon. Members seem to believe. Since the truce, the procedure has been set up by which a number of persons on the Sinn Fein side and a number of persons representing the Government have been appointed for liaison duties. It is impossible during a period of truce to use the same methods of force that were justified during a period of rebellion.

May I ask whether that means that, because the truce exists, the King's writ no longer runs in Ireland?

More Courts of His Majesty can now sit in Ireland than have been able to sit for many months past, and the business of these Courts is going much better than I personally expected it would during this period of truce.

When the right hon. Gentleman prevented the holding of the Mullingar Court, did it necessitate the use of force, or the shedding of any blood?

Is it not one of the terms, admitted by both sides, of the truce that there should be no interference by Sinn Feiners with Government or private property, and is it possible to conceive a Court dealing with people's property without interfering with private property; and, if such Courts are in operation, is it not a direct breach of the truce?

I thought I had answered that. Of course, if anybody in a Court or out of a Court attempts to interfere with Government or private property or private persons, the Government will give those persons and the owners of that property every protection in its power. My own view is that there is less interference with Government and private property since the truce than there was before the truce.

Housing

asked the Chief Secretary whether any, and, if so, what acreage of land has been taken by the Irish Board of Works in or near the City of Belfast for the purpose of erecting houses for sailors and soldiers; what is the location of such sites; and when it is proposed to commence building operations on the 173 houses already promised, and which are urgently needed?

The Local Government Board has acquired 66 acres of land in or near Belfast for the purpose of erecting houses under the Irish Land (Provision for Sailors and Soldiers) Act, 1919. The location of the schemes, which are five in number, is briefly as follows: Two to the north and north-east of Belfast, near Carnmoney and Whiteabbey in Belfast Rural District; two from 10 to 15 miles west and north-west of Belfast, near Crumlin and Randalstown, in Antrim and Belfast Rural Districts; and one to the south-east of Belfast, near Castlereagh. The total number of houses to be erected is 160, and building operations have actually begun on 34.

Will the right hon. Gentleman say what progress has been made, if any, with the actual building of houses?

The total number of houses to be erected is 160, and building operations have already been begun on 34.

asked the Chief Secretary how many houses have been built under the Housing (Ireland) Act elsewhere than in the city of Belfast; and what is the reason for the delay for the Government intimating to local authorities the decision to increase the subsidy to 35s. for every 20s. of rent collected so that local authorities may take steps to make a reduction in rents?

Under the Housing (Ireland) Act, which relates only to, certain classes of subsidised building schemes, 78 houses have been completed in Belfast and 17 elsewhere in Ireland. The corresponding numbers of houses under construction are 177 and 42. The new rates of subsidy were made known some time ago, and draft Regulations embodying them are expected to be issued to local authorities at an early date. The delay in fixing the amount of the Exchequer subsidy was inevitable, in view of the lack of interest in building schemes displayed by public bodies in the greater part of Ireland, the consequent difficulty in obtaining data to base a rate, and the refusal of many such bodies to recognise the Government. I cannot accept the suggestion in the last part of the question that the object of the increased subsidy is to enable local authorities to reduce their rents. On the contrary, provision is made in the draft Regulations to enable the subsidy to be reduced if local authorities fail to secure the best rents obtainable.

Is the right hon. Gentleman not well aware that the reason why public authorities are unable to take full advantage of the scheme is because of the fact that the subsidy is not such as will enable a rent to be fixed that the tenants can reasonably be expected to pay?

That raises the question of how far the Government, which means this House of Commons, can grant money to Ireland. I myself do not feel justified in asking the House to give more money to Ireland at the present time.

Does the right hon. Gentleman not think that municipal authorities representing loyal people, who observe the law and pay their rates and taxes, are entitled to some encouragement?

Dail Eireann (Seized Books and Funds)

asked the Chief Secretary whether certain books and funds belonging to Dail Eireann were seized before the truce by the officers of the Crown in Ireland; whether the books contained valuable evidence as showing the relations between Dail Eireann and certain of the gunmen; whether these books and funds were ordered to be restored to Dail Eireann; and whether it was by his orders that this was done?

No funds or books or captured documents of any kind have been returned to Dail Eireann. It is possible that the hon. Member may be referring to certain property belonging to an institution known as the Sinn Fein Bank, which was seized and became the subject of proceedings in the High Court in Dublin last year. This property was returned on the advice of Crown counsel in the settlement of the litigation.

Will the right hon. Gentleman give us some answer to the latter part of the question, whether these documents showed certain relations between Dail Eireann and certain of His Majesty's officials at Dublin Castle?

Sinn Fein Demands for Money

asked the Chief Secretary whether His Majesty's subjects in Ireland are being forced by Sinn Fein threats to pay what are termed taxes to the Irish Republican Exchequer; and what steps he is taking to prevent these proceedings?

asked the Chief Secretary whether his attention has been called to a printed circular recently issued to the farmers and others in East Donegal purporting to come from the headquarters of a company of the 5th battalion, 2nd brigade, of the 1st north division of the Irish Republican Army, demanding sums varying from £5 to £100 for the maintenance of that army, and stating that any attempt to evade payment will be looked upon and dealt with as the act of an enemy of the Republic; whether similar demands for money have been made and enforced in other parts of Ireland; and what steps the Government have taken to suppress these attempts to force British subjects to support the rebellion in Ireland?

My attention has been drawn to the circular referred to, which constitutes a clear violation of the terms of the truce. Representations have been made in regard to these attempted exactions, and I am glad to state that the responsible Sinn Fein leaders have now issued a public announcement in the Irish Press informing their officials throughout the country that all attempted forced levies and forced collections of money are unauthorised by them, and must be stopped. As I stated in reply to a question on this subject by the hon. and gallant Member for Burton (Colonel Gretton) on Monday, all persons in Ireland may count upon receiving the protection of the Crown Forces in resisting such demands.

If the Noble Lord will give me a specific case of that kind, I will consider it, but to make a general promise would lay me open to the applications of thousands of persons who might allege that they had had money forced from them.

If I hand the right hon. Gentleman a document issued under the authority of Dail Eireann, with the name of the party to which it is directed upon it, will he see that action is taken in that case?

Certainly. The difficulty in Ireland is to get anybody to come forward to help us.

Will the right hon. Gentleman say when he first took steps to stop these proceedings?

Kidnapping

asked the Chief Secretary whether, on Friday last, armed Sinn Feiners made a raid on the house of Daniel M'Quaid, a process-server, near Fivemiletown, County Tyrone, and kidnapped this man and carried him away; and whether the police have yet been able to discover his whereabouts or to ascertain his fate or to arrest the raiders?

Mr. Daniel M'Quaid was removed from his house by three masked men, one of whom is stated to have been armed, last Thursday evening. He has not since been heard of. The matter is being actively investigated.

asked the Chief Secretary whether, on 22nd October, a coffin was found in the Roman Catholic church at Sixmilebridge, County Limerick, containing the remains of Constable William Murphy, who was kidnapped last March?

I am informed that the body of Constable Murphy, who has been missing since last March, and was believed to have been kidnapped, was brought by unknown men into the Catholic church at Sixmilebridge, County Clare, about 2.30 a.m. on the 20th instant, and handed over to the clerk of the church.

If steps have> not been taken, they will be. An inquest will be held in the usual way, or, in lieu I of no inquest, a military inquiry, to find out the cause of death.

Are we to understand I that no action is taken in these cases till the matter is raised in the House of Commons?

asked the Chief Secretary whether Private Hobson, of the Essex Regiment, was kidnapped in Cork on or about the 7th September, 1921; what steps the Government have taken to procure his release; and whether, if not successful, they have any information as to his fate?

I have been asked to reply to this question. The man referred to, whose name is Dobson, not Hobson, was kidnapped, but has since escaped.

asked the Chief Secretary whether police-constables Cruise and Coulson were kidnapped whilst unarmed in Barrack Street, Bandon, on or about the 23rd August in this year, that is to say, during the period when the truce was in existence; whether the Government have taken any steps to procure the release of these men and with what result; and whether, if their efforts have not been successful, they have any information as to the fate of these men?

These two constables were kidnapped while walking unarmed in Bandon on 23rd August. Steps were at once taken to secure their release, but in the meantime the men escaped and returned safely to barracks.

Is it not a fact that constables have been previously kidnapped from this area since the truce, whether it is a fact that motor cars are being commandeered at the present time, and farm carts, and is it a fact that Irish republican soldiers are being compulsorily billeted upon loyal inhabitants, and has the right hon. Gentleman not promised his protection to these people over and over again in this House?

This question has no relation whatever to the question on the Paper; but I can assure the House that there is less interference with persons and property in Ireland now than there was before the truce. [HON. MEMBERS: "Oh!"]

asked the Chief Secretary if, on the 13th instant, a Protestant loyalist, named Thomas Woods, of Corryhagen, Ballybay, County Monaghan, was kidnapped by eight armed men of the Sinn Fein organisation as he was working with his father in his field; that he was taken away in a motor car, tried by Sinn Fein court-martial at a place called Tully-corbet, about seven miles from his home, and fined in the sum of £20 for being a loyalist; that he was further informed that if this money was not paid within a certain time both he and his father would be taken on the next occasion; and has any special means of protection been accorded to this family and other loyalists in that district?

I am informed that Mr. Thomas Woods was kidnapped, as stated. He was released on the 15th instant. I have no information as to the alleged fine of £20, but am making further inquiries as to this and have directed instructions to be sent to the local police to afford Mr. Woods all necessary protection. The County of Monaghan has a large force of police, and if the number is not sufficient, it can be increased.

Is the right hon. Gentleman aware that the Sinn Fein court- martial, if we may so call it, has threatened this man that, if he does not pay this fine of £20, he and his father will be taken into custody by the authorities? In the absence of any protection up to the present, what is going to happen to these loyalist people? Will arms be given to the loyalists in that district, with which to defend themselves?

As I have tried to explain to the hon. Member who asked the question, I shall make inquiries as to whether it is true.

asked the Chief Secretary whether he is aware that two constables of the Royal Irish Constabulary stationed at Mallow Barracks were kidnapped on the night of Saturday, 26th October; what steps the Government have taken to procure their release; and with what result?

Immediate action was taken in this matter, and I am glad to be able to inform the House that the two constables have been released and have returned to their station uninjured.

Sinn Fein Liaison Officer, Cork

asked the Chief Secretary whether he is aware that the Irish Republican Army liaison officer appointed for Cork under the terms of the truce was largely responsible for organising the ambush near Macroom of the 28th November, 1920, in which 15 auxiliary police were murdered and mutilated; and whether such an appointment is in accordance with the terms of the truce?

Has the right hon. Gentleman had any evidence at all that the individual in question, whose name is Barry, is the person who led the assassins who murdered the cadets?

I have no evidence of that fact. If there is any evidence of that, I should certainly think this appointment as a liaison officer would be most provocative.

Is the right hon. Gentleman not aware that at a public meeting this man Barry—Commandant Barry as he is called—was congratulated upon his action?

I wish the hon. and gallant Member would send me the information on which he bases his statement. I have told him that if the facts as stated be true, the appointment of this liaison officer would be most provocative.

Truce

asked the Chief Secretary whether he will inform the House what action has been taken by His Majesty's Government to prevent further infractions of the truce; and what specific results have been obtained there-from?

It would be impossible within the limits of an answer to deal with this question, except in general terms, and in the circumstances I would refer the hon. and gallant Gentleman to what I said in reply to the hon. and gallant Member last Thursday. I would add that every possible step is being taken by the Government to prevent infractions of the truce and with success. Some of the specific results are the dispersal of camps, the vacating of commandeered houses, kidnapped persons have been released, etc.

Does the right hon. Gentleman realise or has he heard of the specific case of a woman who two or three days ago was specially sent over to Ireland to be tried by a Sinn Fein court?

asked the Prime Minister the precise terms of the so-called truce between His Majesty's Government and Irish Sinn Fein rebels; by whom on each side the terms were signed; and when they were published and where?

The terms of the truce appear in the White Paper published yesterday. The terms were discussed by the General Officer Commanding-in-Chief in Ireland with Mr. de Valera, and the general headquarters communiqué set out in the White Paper was issued by the General Officer Commanding-in-Chief accordingly. At a subsequent discussion between the General Officer Commanding-in-Chief and Mr. Duggan and Mr. Barton, an alternative draft was submitted by the latter and accepted by the General Officer Commanding-in-Chief. These terms are those set out in the latter part of the White Paper, and in a memorandum to his commanding officers issued by the General Officer Commanding-in-Chief, he brought the terms to their notice. The Sinn Fein representatives published the terms in the Irish Bulletin. These terms were not signed, but have been acted on as the terms of truce.

I wish to raise a point of Order. The Prime Minister alluded to the Member for East Clare. May I ask you, Mr. Speaker, whether it is in order to describe this man as the Member for East Clare, when he is also the Member for East Mayo? The Standing Order says that a Member must decide within one week which place he is going to sit for. Further, in view of the fact that he is an alien, and refuses to take the Oath of Allegiance, is he not ineligible in any case?

I think he is at present the Member for two constituencies, and when he presents himself at the Table to take the Oath he will have to choose for which constituency he will sit. The Prime Minister, I think, is quite in order.

As the Prime Minister admitted that there were no signatures to the so-called truce, why did the Leader of the House yesterday lead the House to suppose that the truce had been signed? [HON. MEMBERS: "He did not," and "Withdraw."]

As the terms of the truce as set forth by the representatives of the Government and the representatives of Sinn Fein are by no means identical, which is the correct form?

If the hon. Member will look at my answer he will see that I have very specifically answered that question. I say that these terms were not signed, but they have been kept as the terms of a truce.

Is it not an extraordinary thing that such a document was not signed?

How is it that a document, which has not been agreed to, was published in the "Times" and in the first part of the White Paper as if it had been agreed to? Is the Prime Minister aware that the "Irish Bulletin" have invariably said that the first document had not been agreed to and this is the first intimation the House has had about the second document, which was agreed to?

We have published both documents. I only saw the Commander-in-Chief this morning and got an account of the whole transaction. The truce was arranged in Ireland between the Commander-in-Chief and the representatives of Sinn Fein here. I know that the Commander-in-Chief was there and I got his account of the transaction which I have given to the House to-day.

Are we to understand that the Government did not know the exact terms of the truce until this morning. [HON. MEMBERS: "Answer!"]

I was getting up to answer. On the contrary, we proceeded on the assumption that the second document was the one on which the truce was based, and in all the discussions we have had in regard to the breaches of the truce, that is the document upon which we have acted. That is the account given us this morning by the Commander-in-Chief. I only sought an explanation this morning as to why there were two documents and I have given that explanation to the House.

It was published in the "Times" by the Dublin headquarters as being the proper document, and it has never been contradicted.

It was issued by head quarters because it was a document arranged on the first day. The document presented on the second day was a more accurate account of the interview between them. That probably did not appear in the "Times" or any other paper. [HON. MEMBERS: "Yes!"] I understand that the second document did appear in the "Times"

Is the Prime Minister aware that both were published on the same day and in the same paper?

Seizure of Furniture, Bantry

asked the Chief Secretary whether he will inquire into the case of Mr. W. C. Ringwood, late manager of the Provincial Bank of Ireland, Bantry, whom members of the Irish Republican party endeavoured to kidnap last July after commandeering his motor car and bicycle; whether he is aware that this gentleman was then compelled to give up his position and to take refuge in England; that, on endeavouring to sell by auction his furniture, those who attended the sale were informed that the furniture was forfeit to the Irish Republic and that any person who bid for it would be shot; whether the furniture is now held under lock and key in a public building at Bantry, although Mr. Ringwood desires, to bring it across to England; and is he prepared to have arrested the persons concerned in this outrage?

I am inquiring into this case, and shall be glad if the hon. and gallant Member will repeat on Monday the question, of which I only received notice on Tuesday.

Malicious Injuries Awards

asked the Chief Secretary whether his attention has been called to a proclamation issued by the Republican Minister for Local Government, and addressed to all holders of decrees for malicious injury awarded in enemy courts, warning them that they will be proceeded against with all the forces at the disposal of the Republican party should they or their solicitors take any steps to apply for or receive payment of the amounts awarded; and what action does he propose to take with the gentleman who has signed this document?

I would refer the hon. and gallant Member to my reply to a question on this subject by the hon. and learned Member for York on Monday. In addition, I would say that if the hon. and gallant Member has a specific case, I hope he will forward the facts to the Irish Office so that it may be dealt with.

Is not this a clear case of a member of this Dail Eirenn, as it is called, deliberately breaking the truce?

Is it fair, does the right hon. Gentleman consider, to expect Members of this House to convey information to him which his own officers in Ireland ought to know, and does he know that within the last 24 hours a workhouse in the County of Donegal has been commandeered and is occupied by 100 of the Irish Republican Army, who are now quartered there? [HON. MEMBERS: "Answer!" and Interruption.]

Loyal Citizens (Threats)

asked the Chief Secretary whether since the so called truce loyal citizens in Ireland have been threatened with death unless they leave the country?

I have not received particulars of any case where attempt has been made since the truce to compel a loyal citizen, by threats, to leave Ireland. If any hon. Member has information of any specific case of the kind, I shall be glad to receive it and can promise that immediate action shall be taken.

Is the right hon. Gentleman aware that I personally sent him a case, urgently, and implored him to act before it was too late?

Who is keeping this information back? Everybody else knows the facts‡

Is the right hon. Gentleman aware that I myself gave work to a man who came to Belfast, and who was threatened in this manner? That is a specific case. If he wants the name and address, I will give it to him.

Settlement Conditions

asked the Prime Minister what is the precise meaning of the statement in his letter of 20th July last to the Member for East Clare, in which he says that the British Government propose that the conditions of settlement between Great Britain and Ireland shall be embodied in the form of a treaty to which effect shall in due course be given by the British and Irish Parliaments; and whether it is intended that the terms of any settlement shall be open to revision and alteration by the Imperial Parliament?

asked the Prime Minister whether, in view of the length of time that has elapsed since the proposals of the Government for an Irish settlement were made public, he is able to say that the five fundamentals then laid down, control of the seas round Ireland, a limited territorial force, all necessary facilities for military and civil air communications, no protective duties or restrictions on the flow of trade, and a responsibility for a share of the present War debt and pensions arising out of the War, still form fundamentals and will not be modified or abandoned without the consent and knowledge of the House?

The results of the Conferences now being held will be submitted to Parliament and the concurrence of Parliament in any settlement is of course necessary. It will be quite impossible to conduct negotiations if reports are made from time to time as to the position taken up on particular issues at the Conference meetings by the negotiators on both sides.

Will the Prime Minister answer my question as to whether the terms of settlement are to be open to revision and alteration by Parliament?

Most distinctly. It would be quite impossible to have a settlement except with the full consent of Parliament. The whole of the terms will be submitted to Parliament on the assumption that there is a settlement, and every provision will have to be ratified by Parliament even to the smallest detail.

Does the same remark apply to the Dail Eireann? Will they have to ratify the Treaty?

I know nothing at all about Dail Eireann, but I know that the settlement must receive the sanction of the Imperial Parliament.

If there is to be a settlement—the Act of Union was a Treaty and it was an Act of Parliament—it must be an Act of Parliament. Nobody can put any settlement into force except with the sanction of the Houses of Parliament.

Between whom is it proposed that this so-called Treaty shall be made, and what parties?

Between the duly elected representatives of the Irish people under an Act passed by this House and by the Government of the day.

How can they be considered to be the representatives of the Irish people when they have not taken the oath of allegiance?

The hon. Member has misunderstood me. I said "duly elected under an Act of Parliament."

Army (Command)

asked the Prime Minister whether the Commander-in-Chief in Ireland receives his instructions from the Lord Lieutenant or the Chief Secretary or the Army Council; and, if not, will he say by whom instructions are given?

asked the Chief Secretary for Ireland whether the Army in Ireland is under his orders; and whether the General Officer Commanding, Ireland, takes orders from his official superiors at the War Office with reference to military measures to prevent rebellious actions, or has he first to submit his proposals to him?

The Army in Ireland is under the command of the General Officer Commanding-in-Chief, Ireland. All military measures are taken by him at his discretion, in accordance with general instructions given to him by the Army Council, acting upon the policy laid down by the Government. In the martial law area, where exceptional powers have been given to the military authorities, the General Officer Commanding-in-Chief consults and is guided by the Chief Secretary in all questions of policy affecting the civil government or administration.

Does the authority of the Commander-in-Chief in Ireland extend to negotiating truces?

Sinn Fein Police

asked the Chief Secretary if orders have been issued from the Irish Government to the members of the Royal Irish Constabulary that they are not to interfere with any members of the so-called Sinn Fein police who may be found on licensed premises during prohibited hours?

asked the Chief Secretary if the Irish Government has decided not to prosecute under the Licensing Act members of the Irish Republican Army police found upon licensed premises during prohibited hours?

It is not a fact that the Irish Government have decided not to prosecute persons found upon licensed premises during prohibited hours.

Is the right hon. Gentleman aware that a copy of this order was given to every district inspector in every county in Ireland?

No such order was issued by the Irish Government, and I do not know how the hon. Member got a copy of it. If it was issued by someone outside the Government, then it will be cancelled.

Major Compton-Smith (Murder)

asked the Chief Secretary whether his attention has been called to an advertisement offering –500 reward for evidence leading to the conviction of the murderers of the late Major Compton-Smith, M.C.; whether such an advertisement appeared last June with the sanction of the Irish Office; whether the police have any information as to the identity of the murderers; and whether the police, since the date of the truce, have taken, and are willing to take, any and what steps to obtain information on the point, or whether, since the truce, the police have been directed not to make arrests or searches in connection with the matter?

My attention has been drawn to this advertisement. I did approve the advertisement that appeared in June, but was not consulted in reference to any advertisement appearing since 11th July. With regard to the rest of the question, police investigations are, during the existence of the truce, necessarily limited by the agreed terms.

Conference

( by Private Notice ) asked the Prime Minister whether the Conference with the Sinn Fein delegates is still proceeding, and, if so, on what conditions?

The answer to the first part of the question is in the affirmative. As regards the conditions, I have nothing to add to the answer which I gave to my hon. Friend on the 24th instant.

Are we to understand, then, that the delegates have repudiated Mr. De Valera's claim that Ireland is an independent nation?

That is just the point on which I disallowed the hon. Member's question as presented to me. He is now trying to put it in the form of a supplementary question.

Does the right hon. Gentleman think it is consonant with the great position which he occupies to engage in negotiations to arrive at a formula with people who repudiate allegiance to His Majesty the King?

The hon. Member is now entering into an argument. This Conference has been sitting for some time past.

Questions

Christmas Holidays

asked the Prime Minister whether, in view of Christmas Day falling on a Sunday and the consequent loss of a public holiday, he will recommend the making of an Order in Council making Tuesday, 27th December, an additional holiday, as was done in 1910?

After consultation with the banks, I propose to recommend that in due course the necessary steps should be taken to declare Tuesday, 27th December, a Bank Holiday this year in England and Wales.

Rings and Trusts

asked the Prime Minister whether he is aware that certain wholesale trade rings and trusts, in their attempt to hold up prices against the public, refuse to sell to retailers who import from abroad; and, seeing that this amounts to a conspiracy with a view to the restraint of trade, what steps does he propose to take in order to combat this evil?

I have been asked to reply. I have not had any specific case of the type referred to brought to my notice, and I should be glad if the hon. Member would give me further particulars.

Is the right hon. Gentleman aware that when the Profiteer- ing Act was passed undertakings were given that the Government would take steps to deal with the major question of the large trusts who were profiteering on a wholesale scale: when will the Government redeem these undertakings?

Austria (Financial Position)

asked the Prime Minister if his attention has been called to the serious situation that has arisen in Austria owing to the exhaustion of credits and the depreciation of the currency; if he is aware that the recent Anglo-French advance of –500,000 will only provide food for two weeks; and what steps are proposed to restore confidence and to tide over the time which must elapse until the American liens are postponed, as these liens present a technical difficulty in the way of the credit scheme proposed by the League of Nations?

His Majesty's Government is watching with close attention and sympathy the difficulties of the Austrian Government's financial position. By agreement with the French Government temporary financial assistance, not necessarily limited to the figure mentioned in the question, is being arranged for, the advances so far as this country is concerned being provided through banking channels. It is unfortunate that technical difficulties have hitherto stood in the way of the release by the United States Government, as has been agreed by other Governments, of the liens held upon Austrian assets, which is an essential preliminary to the securing of foreign credits by the Austrian Government under the plan which it worked out with the League of Nations. I have every hope, however, that this difficulty will eventually be overcome. In the meanwhile the strenuous efforts which the present Austrian Government is making to put Austria in a position to help herself by restoring Budget equilibrium cannot fail to have a good effect both on the immediate position in Austria and on the prospect of obtaining foreign credits.

Do I understand from that reply that during the delay in getting American relief, such assistance will be given as will prevent a general panic?

We are giving such assistance as we can in, times which are very difficult for our own country, as the hon. and gallant Member knows.

Is it not a fact that it will take a generation unless we revise the Peace Treaty and give this great nation an outlet to the sea?

Unemployment

Mid-Scotland Ship Canal

asked the Prime Minister whether, with a view to absorb part of the large number of unemployed in Scotland, he has considered with his advisers the construction of a mid-Scotland ship canal; and whether he is aware that in many quarters this scheme is regarded as likely to be financially remunerative and has also the strong approval of the Admiralty?

The scheme to which my hon. Friend alludes has been considered with reference to the question of unemployment. I am not aware that there is any convincing evidence that the scheme would be financially remunerative. I am informed that in the opinion of the Admiralty the strategical advantages of such a canal are not of sufficient importance to justify the Government in incurring at the present time the expenditure which would be involved.

Will an inquiry be made into this matter on the part of the Government?

If the Government will not consider this question, will they consider the question of the Crinan Canal which is on a smaller scale?

Insurance Premiums

asked the Prime Minister whether the Cabinet Committee on Unemployment can be urged to take into account the position of many workers now unemployed who hold policies in various insurance companies and societies, to which they have for many years contributed their weekly premiums for substantial benefits to be received in various ways, which will lapse altogether if 13 weeks elapse without the premiums having been paid; and whether, in view of the importance of encouraging thrift and safeguarding the financial position of many of these companies and societies, some scheme can be evolved, in conjunction with the trade unions and friendly societies, whereby the position of contributors to these societies and companies can be saved from forfeiting the benefits for which for so long they have contributed, and may not be compelled, out of relief-work payments and donations, to pay the weekly premiums at present, but defer payment until they are again in regular employment?

I have been asked to reply. The question of the relaxation of the conditions of industrial assurance policies in present circumstances is clearly one for the companies and societies concerned, and is, I understand, receiving their serious consideration. It would obviously be very difficult for the Government to intervene in such a matter.

Local Rates

asked the Prime Minister if he is aware of the heavy burden which is being imposed upon the local rates owing to the distress arising from unemployment; that, in the opinion of many boards of guardians, this should be a national and not a local charge, and that local resources have already been drained to the utmost limit; and whether he will now consider some scheme under which this continuing and increasing charge can be met from the national Exchequer rather than by a system of short-dated loans, which will only aggravate the difficulty in the near future and increase the ratepayers' burden?

I have been asked to answer this question. I have received a number of representations from boards of guardians on this subject, and I am doing my best to assist them in meeting their difficulties. But, as the hon. Member must be aware, the Government's proposals for dealing with unemployment will place a very heavy burden upon the National Exchequer, and I do not think that the Government could wisely go further than they have done in the direction of relieving the local rates at the expense of the taxpayers. The policy of short-dated loans appears to me to be the best method of enabling the authorities to tide over the difficulty caused by the present heavy burdens on the rates until such time as conditions improve.

Is the right hon. Gentleman aware that so long as the cost of extra relief for unemployment remains on the rates the main burden in that case will be met by the workers who already are working short time, and so long as it remains on the rates will fall on those communities where the most unemployment exists? Is it not desirable that the richer residential areas should bear their fair share?

Questions

Hungary (Ex-Emperor Karl)

asked the Prime Minister whether he can make any further statement on the recent events in Hungary; what steps are being taken by His Majesty's Government to prevent the restoration of the ex-Emperor as King of Hungary; and whether the Government of the French Republic is co-operating with His Majesty's Government in this matter?

The ex-Emperor Karl was captured by Hungarian Government forces on the 24th instant. The Hungarian Government are holding him prisoner, and have requested a decision of the Allied Powers as to his ultimate destination. The Allied Governments are already in consultation on this point. The answer to the last part of the question is in the affirmative.

Are we to understand that we are directly interfering with any form of Government of any country on the Continent? [An HON. MEMBER: "What about Russia?"]

Will the right hon. Gentleman take steps to see that ex-Emperor Karl is not brought to this country for refuge? [HON. MEMBERS: "Why not?"]

Passports and Visas

asked the Prime Minister whether he is aware that a series of resolutions have been sent to the Prime Ministers of all the Allied and ex-enemy Governments by the secretary of the International Federation of Commercial, Clerical, and Technical Employés protesting against difficulties encountered by commercial travellers and business men on the frontiers of all countries by unnecessary passports, visas, and irritating Customs inspection; and whether he can state the attitude of the British Government towards those resolutions?

These resolutions have been communicated to His Majesty's Government, whose attitude to these questions is guided by the recommendations of the Conference on Passports, Customs Formalities and Through Tickets, held at Paris in October, 1920, which His Majesty's Government have accepted. I am sending the hon. Member a summary of the recommendations.

Russia (Destitute British Subjects)

asked the Prime Minister if he is aware that many British subjects lately settled in Russia, several of whom were owners of large factories there and rendered great assistance to the Allied cause in the first three years of the War, are now in this country in a state of destitution; that these men begged the then Ambassador at Petrograd, in view of the great sums that the British Government was sending into Russia, to take their savings in roubles, crediting them with the amount in England instead of receiving money direct from there, and that the Ambassador refused; and whether, in view of the fact that we are spending large sums for the relief of Armenian, Assyrian, and Russian refugees, he will first assist these men of our own race in all cases where their bona fides can be proved by advancing to them small loans repayable if, and when, the indebtedness to foreign creditors is recognised by a Russian Government?

It is not possible at such short notice to verify the information contained in the first and second paragraphs of the hon. and gallant Member's question. It would not, however, alter the decision of His Majesty's Government, that they are unable to advance loans to the British subjects in question in respect of Russian claims which will be dealt with in due course in accordance with the declaration attached to the Russian Trade Agreement of 16th March.

Is the hon. Gentleman not able to do anything now for these men who are in a state of practical destitution; and will he not consider allocating a portion of the –580,000 voted by this House for the relief of Assyrian, Russian and other refugees for this purpose?

Customs Examination (London)

asked the Prime Minister if he is aware that on Tuesday morning, the 25th instant, at the riverside in the East End of London, there were large groups of unemployed men and youths occupied in playing football or standing at street corners, while in the adjacent docks and wharves there were thousands of packages of miscellaneous goods for the removal of which their services could be employed but which His Majesty's Customs refused to hand over to their consignees owing to the formalities connected with the collection of the German reparations duties, the M'Kenna duties, and the duties alleged to be payable under Part I of the Safeguarding of Industries Act; and whether he is prepared to appoint at once some special commissioner who can investigate the position, with power to take action at discretion, with a view to expediting the method adopted for dealing with the goods referred to above as being dutiable and, in cases where there is doubt as to their liability to duty, to adjudicate on the spot and thus enable the trading community to get on with its business?

The answer to the first part of the question is in the negative. I cannot admit that the non-removal of the goods referred to is due to action on the part of the Customs. Questions of liability rarely arise in connection with goods on which the "new import duties" of 1915 or the Reparation levy are claimed, and delivery can be obtained without delay when the Customs entry has been presented and the goods produced for examination. If the decision of the Customs authorities as to liability of goods to Key Industry Duty is disputed, a method of obtaining a final decision is prescribed by Section 11 of the Safeguarding of Industries Act. Meanwhile, delivery of the goods can be obtained on deposit of the duty claimed, and I am informed that traders are freely taking advantage of this arrangement. I am not prepared to adopt the proposal made by the hon. Member in the concluding part of his question.

Is not the right hon. Gentleman in possession of the whole data as to the names of the ships and of the traders who are complaining of being unable to get their goods although they have been in England nearly four weeks. Full details were sent to him?

There can be no real ground for such complaint if the goods were produced for examination.

Cabinet Meetings, Scotland

asked the Prime Minister what is the total cost involved by the visits of experts and other advisers who attended him during his stay at Gairloch?

I have been asked to reply. I would refer my hon. Friend to my answer to the hon. Member for West Bermondsey on the 25th instant.

Hartlepools (German Bombardment)

asked the Prime Minister whether he can give any date, or approximate date, when compensation will be paid to those who suffered in person and property from the German bombardment of the Hartlepools on 16th December, 1914; and whether, if such a date be indefinite or remote, in view of the fact that many of the sufferers are in great and increasing indigence, the Government will forthwith make payments to them in advance?

I would refer the hon. Member to the answer given to the right hon. Member for Deptford on the 25th instant.

What has that answer to do with the question I have on the Paper? It has no relation to the Hartlepools whatever. What has Deptford to do with the Hartlepools?

As I read the question and the previous answer it seemed to me that the one fitted the other exactly.

Is the right hon. Gentleman aware that most of these sufferers are very poor people; that they have now waited nearly seven years without compensation; and that many are on the rates and actually in the workhouse?

Albania

asked the Prime Minister whether the Conference of Ambassadors have yet agreed about the boundaries of Albania; if not, whether he can say which Government or Governments is holding up the decision; and whether it could be arranged that the meetings of the Conference should be held in public so that the world may know who is responsible for these delays?

An early decision of the Ambassadors' Conference is expected, and I do not consider that the discussions would be facilitated by the procedure which the Noble Lord suggests in the last part of his question.

Is the right hon. Gentleman able to answer the second part of my question, as to the holding of the meetings of the Conference in public. Is the right hon. Gentleman aware that this question has been discussed for weeks and weeks at Geneva, and that the decision of the Ambassadors' Conference was hourly expected? Can he in any way bring pressure to bear on that distinguished body to do its business more quickly?

My Noble Friend has had some experience of the difficulty of getting decisions from a conference with such varied and conflicting interests. Not even the League of Nations is always able to act very promptly. Here you have a great many conflicting views, and it has not been easy to reconcile them.

Is it not the fact that, but for the opposition of one Power, this question would have been settled weeks and weeks ago?

Is it not a question of this sore being kept open in the interests of one particular Government—the Italian Government?

German Reparation

asked the Prime Minister whether, in view of the reported difficulty experienced by Germany in respect to the payment of reparation, the Allied Powers will again take into consideration the desirability of suggesting to the German Government that it might well raise money by selling some of the country's art treasures; and whether he can give the House any assurance that where there is in some quarters a disposition to urge the waiving of money payments by Germany, this alternative form of raising considerable funds will not be overlooked?

I will convey the hon. Member's suggestion to the Reparation Commission, whose function it is to supervise the fulfilment by Germany of her reparation obligations.

Is it not extraordinary that such a matter has not been considered before this?

Minerals (Nationalisation)

asked the Prime Minister if it is the intention of the Government to introduce legislation to redeem the promise made to nationalise the minerals of the country; and, if so, when it is proposed to bring such legislation before Parliment?

I have been asked to reply. I am unable at present to add anything to the answer given by my right hon. Friend the President of the Board of Trade on 18th July last to the hon. Member for East Nottingham.

National Whitley Council

asked the Chancellor of the Exchequer whether he can give any further information as to the appointment of Members of this House to the official side of a National Whitley Council; and whether ex-service men as such will be given representation on the staff side, in view of the fact that the majority of the staff are ex-service men?

The question of appointing Members of this House on the official side of a National Whitley Council is still under consideration. The matter raised in the second part of my hon. Friend's question would be one for the consideration of the staff side of the Council.

Could the hon. Gentleman give me a definite reply to either of these questions during the Session?

I will certainly give the hon. Member a definite reply to the first part of the question as soon as I am able to do so. As regards the second part, my reply is definite, that it is not a matter for the consideration of the official side or of the Government. The staff side will arrive at their own conclusion as to their own composition.

Unearned Incomes

asked the Chancellor of the Exchequer if he will issue a statement continuing the table published by Mr. M'Kenna as Chancellor of the Exchequer in May, 1916, showing the total percentage of unearned incomes from –150 to –100,000 payable under the Finance Act as Income Tax, Super-tax, and premiums necessary to provide estate duty, taking 40 as the age for the last purpose?

asked the Chancellor of the Exchequer the total percentage of unearned income from –150 to –100,000 payable under the Finance Act as Income Tax, Super-tax, and premiums necessary to provide estate duty, taking 40 as the age for the last purpose, in continuation of the figures given by the then Chancellor of the Exchequer in May, 1916, when the rates of taxes were considerably lower than at present?

I will circulate in the OFFICIAL REPORT a table giving the information desired.

Following is the Table:

TABLE showing the Estate Duty, Income Tax and Super-Tax payable on certain "Investment" Incomes, expressed as shillings and pence in the £ of total income, at rates of taxation now in force.

Income.

Equivalent Estate at 5 per cent.

Rate of Estate Duty.

Estate Duty payable.

Average Annual Life Insurance Premiums (starting at age 40) necessary to provide the Estate Duty.

Equivalent rate per £ after allowing for the consequential Income Tax Relief.

Income Tax per £ of total income ( see note). note).

Supertax per £of total income.

Total Annual rate per £ of total income.

Per centage of total income.

£

£

%

£

£

s. ..

s. ..

d. ..

s. ..

d. ..

s. ..

d. ..

s. ..

d. ..

%

150

3,000

3

90

2

8

0

3

0

3

0

6

2·5

200

4,000

3

120

3

4

0

3

0

11

1

2

5·8

300

6,000

4

240

6

8

0

4

1

8

2

0

10·0

400

8,000

4

320

8

11

0

4

2

3

2

7

12·9

500

10,000

4

400

10

14

0

4

3

0

3

4

16·7

600

12,000

5

600

16

1

0

5

3

6

3

11

19·6

700

14,000

5

700

18

14

0

5

3

10

4

3

21·3

1,000

20,000

6

1,200

32

2

0

7

4

6

5

1

25·4

3,000

60,000

11

6,600

176

11

1

0

5

6

0

7

7

1

35·4

4,000

80,000

13

10,400

278

4

1

2

5

7

1

1

7

10

39·2

5,000

100,000

14

14,000

374

10

1

3

5

9

1

5

8

5

42·1

10,000

200,000

18

36,000

963

2

1

8

5

10

2

11

10

5

52·1

25,000

500,000

25

125,000

3,344

0

2

3

5

11

4

3

12

5

62·1

50,000

1,000,000

28

280,000

7,490

0

2

7

6

0

5

1

13

8

68·3

100,000

2,000,000

35

700,000

18,725

0

3

3

6

0

5

6

14

9

73·7

150,000

3,000,000

40

1,200,000

32,100

0

3

9

6

0

5

8

15

5

77·1

NOTE.—The rate of Income Tax given is the rate payable by a single person. There would be practically no reduction in the case of the larger incomes if the rate applicable to a married man with children were substituted; in the case of the smaller incomes the rate would be reduced considerably.

Egypt (Conference)

( by Private Notice ) asked the Prime Minister whether negotiations with the Egyptian Government have now reached a point where merely the signatures of the Egyptian representatives are required for completion; whether in these negotiations the British Government has practically agreed to all the Egyptian requests; and whether any such agreement does not require the sanction of Parliament before it can be entered into by any Government?

The answer to the first and second parts of the question is in the negative. With regard to the last part, my hon. Friend may rest assured that no change will be made in the relation between this country and Egypt without adequate opportunities being given for discussion by Parliament.

Can the right hon. Gentleman say whether the communiqué which appeared in practically the whole London Press, giving the head- ings of an agreement, was on official communiqué given by a Government Department, or was it an invention of some pressman?

Can the right hon. Gentleman give a definite assurance to the House that there will be no conference committing this country to any final policy until this House has had an opportunity of stating what the desires of the people of the country are? Is there to be another conference like the one held immediately Parliament got up last autumn?

That conference was announced before Parliament separated, and there was plenty of opportunity for my hon. and gallant Friend, or anyone else who wished to challenge the conference to do so. The conference with regard to Egypt has been sitting for months while Parliament was sitting.

Is it not a fact that in that case the Government actually made offers at that Conference which they had stated to be absolutely impossible in the House of Commons only a few weeks before?

Is the account given of the position of the negotiations on the Egyptian question in the "Times" to-day a substantial and accurate description?

I am sorry to say I have been rather too busy to read the "Times."

If the negotiations which the right hon. Gentleman says are taking place are not concluded, or are not in a position to be placed before the House before Parliament rises, may we take it that no concluded agreement will be come to until after Parliament sits again in February?

I think it is a matter of such vast importance to the Empire that Parliament must have an opportunity of discussing it.

Is it not a fact that the Legislative Assembly of Egypt has not met since 1913?

Postal Deliveries (Christmas Day)

( by Private Notice ) asked the Postmaster-General if he is now in a position to say what the postal arrangements for Christmas Day will be?

On Christmas Day a full delivery of letters and parcels will be given both in London and the provinces. On Boxing Day there will be no deliveries. This will be the first occasion on which there has been a full delivery of parcels and letters in London when Christmas Day falls on a Sunday. I would make an earnest appeal to the public to see that they post early.

On a point of Order. My question No. 15 to the Chief Secretary was not answered. He said I might ask it as soon as Questions were over. May I ask it now?

Business of the House

As regards the business for Monday, the Prime Minister will at once make a statement.

On Tuesday we shall put down the Unemployed Workers' Dependants (Temporary Provision) Bill, Report and Third Reading.

On Wednesday and Thursday we propose to take further stages of the Trade Facilities Bill and other Bills upon the Paper.

To-morrow we shall take the Orders as announced—the Local Authorities (Financial Provision) Bill, Second Reading, will be first Order, and the Poor Law Emergency Provisions (Scotland) Bill, Second Reading, second Order.

Irish Conference

Proposed Vote of Censure

Statement by Prime Minister

As it is evident that there is a section of Members of the House who have serious misgivings as to the Conference which is now proceeding between representatives of His Majesty's Government and representatives of the Sinn Fein Members for Ireland, I think it is essential that we should know where we stand as a Government before we go very much further. It is a matter of vital moment to this country and to the Empire, and no Government can conduct negotiations of that kind without knowing that it has the support of the House, from which it derives its authority, and therefore we propose to allocate Monday for the discussion of a Resolution which has been placed on the Paper and we trust there will be a Division on the subject.

In respect of that announcement, may I ask, on a point of procedure, whether at the beginning of the Debate on Monday, the Prime Minister will make a statement, or is it understood that those who are finding fault with the action of the Government in relation to the Conference are to make their ease?

There is a Resolution which is tantamount to a Vote of Censure on the action of the Government in proceeding with this Conference. It is quite clear that we cannot proceed with the Conference unless we know that the House of Commons is behind us. We therefore propose to allocate time for the discussion of that Motion of Censure in order to know exactly where we stand.

Orders of the Day

Trade Facilities Bill

Considered in Committee.

[Mr. JAMES HOPE in the Chair.]

CLAUSE 1.—(Power of Treasury to guarantee loans.)

(1) 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, are to be applied towards or in connection with the carrying out of any capital undertaking, or in, or in connection with, the purchase of articles manufactured in the United Kingdom required for the purposes of any such undertaking, and that the application of the loan in the manner proposed is calculated to promote employment in the United Kingdom, the Treasury may, subject to the provisions of this Section, guarantee in such manner and form and on such terms and conditions as they think proper the payment of the interest and principal of the loan or of either interest or principal:

Provided that the aggregate capital amount of the loans the principal or interest of which is guaranteed under this Section shall not exceed the sum of twenty-five million pounds

(2) No guarantee shall be given by the Treasury under this Section after the expiration of twelve months from the commencement of this Act.

(3) Such sums as may from time to time be required by the Treasury for fulfilling any guarantees given under this Section shall be charged on and issued out of the Consolidated Fund of the United Kingdom or the growing produce thereof.

(4) All sums paid from time to time in or towards the repayment of any sum issued out of the Consolidated Fund under this Section shall be paid into the Exchequer.

(5) The Treasury shall, as soon as may be after the expiration of each quarter of the year during which guarantees may be given under this Section, lay before both Houses of Parliament a statement of the guarantees given under this Section during that quarter, and shall, so long as any such guarantees are in force, lay before both Houses of Parliament in every year within one month after the thirty-first day of March an account up to that date of the total sums, if any, which have been either issued out of the Consolidated Fund under this Section or paid in or towards repayment of any money so issued.

(6) In this Section the expression "capital undertaking" means an undertaking involving capital expenditure.

4.0 P.M.

I beg to move, in Sub-section (1), after the word "Treasury" ["if the Treasury are satisfied "], to insert the words:

"after consultation with an advisory committee nominated by the Treasury for the purposes of this Section."

My right hon. Friend, the Chancellor of the Exchequer, I understand, is willing to accept these words, but it might be for the convenience of the Committee if we had a somewhat general discussion. It would, I think, very much tend to shorten the discussion on some subsequent amendments of detail.

Before coming to any decision on that question, I would like to hear the view of the Government.

I do not entirely appreciate what saving of time would be effected, and I think the better course would be to accept the Amendment as it stands and to get on to the next Amendment.

Amendment agreed to.

I beg to move, in Sub-section (1), after the word "raised," to insert the words "before or after the commencement of this Act."

I move to insert these words, not with any idea of enlarging the scope of the Bill, but to enable an operation which may have been started before this Bill comes into force to come within its purview. It may very well be that proposals for raising a loan for a purpose exactly consonant with the intention of the Bill may have been begun or may be begun between this time and the passing of the Bill. Why should such a loan raised for a purpose for which the Government and the House would approve be out of time simply because it was commenced before the arbitrary date on which this Bill comes into force. I do not know whether my right hon. Friend is prepared to accept the Amendment, but I think he is perfectly aware why I move it, and perhaps he will kindly tell me whether he is or is, not prepared to accept it.

How can you say whether a loan has been proposed to be raised before the passing of the Bill?

There is a great deal of difference between proposing to raise a loan and having raised it.

I think my hon. Friend (Sir J. D. Rees) is a little apprehensive as to what would happen with regard to schemes which had never got further than the mere intention at some subsequent time of raising a loan. Such a scheme would never be excluded by the terms of the Bill. On the other hand, if we adopted the proposal of my hon. Friend application might immediately be made for the Government guarantee in connection with many schemes for which the whole of the loan had been raised, and I do not want to encourage demands of that kind. Perhaps my hon. Friend will withdraw his Amendment.

What will my right hon. Friend do if I withdraw the Amendment? I quite admit that there is the difficulty which he describes. He says that such a loan as I contemplate will net be excluded, but that will depend merely upon the benevolent disposition of the advisory body or the Treasury, and whether people in want of money can depend upon that benevolence and to what extent is an open and interesting question. If the intention be as my right hon. Friend says, I really do not see why he should not be able to accept my Amendment, understanding that it would be used in the same spirit of restraint that the Treasury proposes to use the words of the Clause as drafted.

My hon. Friend agrees that if we adopt these words they would bring in a class of loan for which money had already been raised and deplete the guarantees which we can arrange for other schemes. Let me put to him a case of the kind which he is seeking to safeguard. A body of people come along to the Treasury Committee and say: "We propose to raise a loan for a certain purpose" Supposing the Committee said, "But you have had a proposal of that kind before," that would never exclude them. The point is that they then propose to raise a loan and they come within the terms of the Act.

I know a case of a local authority who made a profit of £15,000 from a given department, raising a loan at 6 per cent, and repaying the same over a period of 30 years, would a loan be granted to such a local authority for carrying on the work?

I am afraid that question does not arise on this Amendment.

Amendment negatived.

I beg to move, in Sub-section (1), to leave out the words, "any Government."

I am moving this Amendment entirely on my own initiative and in no way implicating the party to which I belong. I am very desirous of getting from the Government an explanation of what loans to other Governments they contemplate, because it is a very dangerous step to start guaranteeing loans raised for the benefit of other countries and for which other countries are responsible in the way of paying interest. The other Governments who might possibly benefit under this Clause may be divided roughly into four classes. First of all, there are the Crown Colonies. Of course, we have often guaranteed loans to Crown Colonies, and it would not need this Bill to extend any such guarantees.

It is absolutely necessary to get statutory authority to give these guarantees. There is no power in existence at the present time.

These sums might be used to guarantee loans to Crown Colonies. In addition to the Crown Colonies, there are the self-governing Colonies, and then there are foreign countries, which may be divided into Allied and enemy countries. What loans do the Government contemplate? If you take the Crown Colonies, there is one particular danger that has to be avoided. The money should not be lent to Crown Colonies where it would not be spent in such a manner as to be reproductive at the shortest possible notice. Secondly, the expenditure of that money should not result merely in an increase of the land value of the settlers of the country. Moneys spent on the West Coast of Africa would be spent in improving the value of our own property. The result of any railways built in Nigeria would immediately show itself in an increased land value which belongs to us, whereas, if similar money were spent in East Africa, it would translate itself into an increase of private land value, and the British taxpayer or the taxpayer of that particular community would not benefit by the expenditure of the money. I would ask the Financial Secretary to the Treasury to be very careful in the granting of these loans, so that where there is a choice between two colonies, that colony should get the loan which will get, not merely the railway, but also the increased value that comes from the building of the railway.

I want to point out another matter in connection with these loans to Crown Colonies. Anyone who has had any connection with the Colony of Kenya lately must realise that in that colony there is a growing feeling of hostility to the rest of the Empire. You have in that colony threats to secede from the Empire, and we ought to be very chary indeed about guaranteeing loans to such a colony. The other day I had a letter from one of the settlers pointing out that the American War of Independence was a long job, that in Kenya they could carry on a similar fight, and that we should find it impossible to keep them within the Empire. I do not want us to render ourselves liable to finding the interest on a couple of millions lent to that colony when we could equally well lend the money to other colonies where we should not run the same risk. Take the case of the ordinary self-governing colonies. It is extremely dangerous to start guaranteeing loans to Canada, Australia, or New Zealand. Directly you do it to one you raise jealousy in all the other colonies, who will insist on being treated equally well with the favoured colony. It is dangerous also because we intend, in guaranteeing these loans, that the money shall be used to encourage employment in this country, when, as a matter of fact, the expenditure and administration of the money must remain in the hands of the Dominion or the Colony, and will be spent as they think fit and proper, and not necessarily in accordance with the wishes of Parliament in passing this Bill and sanctioning these loans. Take the case of the Australian Colonies at the present time. They want loans floated on our market in order to fund their own floating debt. In so far as they are merely paying off their floating debt they are not giving employment in this country by the expenditure of the money. That is required by the Bill, which states:

In regard to loans to foreign countries, we are on far more dangerous ground. At the present time France owes us £1,000,000,000.

I was thinking of our debt to America. There is no possible chance of France paying that money to us.

Ask the French Government. Everybody in this House knows that there is no chance of our getting the money, at least within a reasonable time. Is it conceivable that it would be to our advantage to add to that £560,000,000 an additional £4,000,000 or £5,000,000 by guaranteeing a loan so that the French Government might float that loan on the London market? We might stir up further international trouble by undertaking to guarantee loans to foreign countries, whether it be France, Greece, which is at present, I understand, on the market for a loan, Norway, or any other foreign country. If we guarantee a ioan to a country, and that country finds itself in a difficult position in regard to paying the interest on the loan, and a party in that country urges that the loan should be repudiated and the bondholders should be allowed to come to the English taxpayer for interest, it would make the international situation far worse than it is at the present time. We have guaranteed one famous loan for Turkey. When we guaranteed that loan we entered into a joint guarantee with the French Government, but we have had to pay the interest ever since. It is true that we have not paid it all out of our own pockets, because we have taken part of it out of the pockets of the taxpayers of Cyprus. At any rate, the Turkish Government have not paid the interest on the loan, which has always been a charge upon the British Empire instead of being, as originally intended, a charge upon the Turkish Empire.

It is circumstances such as these which ought to make one very careful about lending money to foreign Powers. I should have thought that the Treasury would have avoided granting any loans to foreign Powers except in such cases as they can get adequate guarantees. Recently the Chinese Republic has failed to meet the interest on its loan. The South American Republics are notorious for the way in which they fail to meet the interest on their loans. Many of the Southern States of North America are defaulters. If they are defaulters to the individual bondholders it is not of so much importance, but if they are defaulters to the British Empire, it is going to be a very serious thing. I urge the Government that if they are going to grant any loans of this sort that they should have adequate security. Fortunately, we are in the position to get adequate security in certain cases. As an illustration I would mention Russia, a country to which I am very anxious that loans should be given. You could get your security there by occupying the ports, by acting as you have done in Egypt or in China. You could get your security on the Customs of the country. [ Laughter. ] Do hon. Members think that the Customs are not a good security? The only part of Russia that we could touch are the ports, because of our Fleet. The Customs, undoubtedly, offer the best security that we could have for any loans to that country.

The hon. and gallant Member knows more about Russia than I do, but surely we have had it explained, again and again, that every enterprise in Russia is a Government enterprise. It seems to me, therefore, that by this Amendment the hon. Member is specifically excluding Russia.

I am asking for information. By my Amendment I wish to exclude foreign Governments from the benefit of these loans, and I am particularly anxious to get from the Government an expression of their views as to the advisability of including Russia as one of the countries which might receive assistance from the passage of this Bill.

Why should we include Russia? Is it because she does not pay her debts?

No, it is because the people of Russia are starving, and are in infinitely greater need of a loan than Australia or the Crown Colonies. It is a case, also, of benefiting the people of this country who are unemployed. I should have thought that it was obvious that if you can get sufficient security you should use that country as one of those where you wish to develop your trade. The whole point is the getting of sufficient security, and I am trying to illustrate to the Committee the way in which the security could be got. The whole question to-day is how we can best benefit the trade of this country. The Government have brought in this Bill and are prepared to guarantee loans up to £25,000,000 in order to encourage trade. They divide the £25,000,000 under four heads: for the Colonies, foreign countries, local authorities, or capitalistic enterprises. If there is only a sum of £25,000,000 to go round, let us keep the £25,000,000 for those places where our security is best, and not go to foreign countries, but if we do go to foreign countries, then let us use this Bill to do good at both ends, to help both the recipient of the loan and our own unemployed here, who are so badly in need of work.

I strongly urge the Government to consider very carefully the new step which they are taking. Is it advisable, after a great many years' experience of foreign countries, that we should proceed on the lines laid down in this Bill to guarantee loans to foreign countries? The Government should take care before starting on the new principle of granting loans broadcast with the idea that it may benefit trade. It may benefit trade, but if the same amount of money was applied to local authorities in this country, where, goodness knows, it is needed just as much as it is in Serbia or elsewhere, it would benefit unemployment. Is it not better, therefore, that we should develop our own country than go abroad and seek to benefit either Crown Colonies, Dominions, or foreign countries.

A short time ago the hon. and gallant Member for Newcastle-under-Lyme (Colonel Wedgwood) and myself were, I presume, the strongest individualists in the House, but I am not quite sure whether he has not been corrupted by the association he has lately entered into. I hope that he has still kept to his own opinions. I have sympathy with his Amendment. This is a very dangerous act on the part of the Government, which may or may not turn out successfully. A great deal will depend upon the unfortunate Committee who are going to administer it. Though I think it is a mistake on the part of the Government to interfere in these matters, and to advance money in this way, it seems to me that if they are going to do it they ought to be allowed to do it in their own way. Therefore, I shall not go into the Lobby with the hon. and gallant Member.

I hope the Committee will not accept the Amendment. My complaint against this Clause and against the Bill is not that it gives power to the Treasury to make these arrangements but that it does not put at the disposal of the Treasury a sufficient sum of money. There is great need for a stimulus in trade, not only in our own country but particularly in many European countries, and that stimulus cannot be applied quickly except by the guaranteeing of assistance. Not only our own Government but possibly the Governments of France and America may be able to come to the assistance of the countries who are in need, and by the granting of credits they may be able to set the industrial wheels turning again. So far as many of the central European countries are concerned, we are at an absolute deadlock. I have every sympathy with the desire of the Mover of the Amendment for information, but his proposal means that the Government must be prevented from giving any guarantee or any credit to countries abroad which, temporarily, may not be in a position to pay for our goods, but ultimately may be able to do so through the credits which we give.

I think the Bill provides for credits rather than loans. The estimate which was given the other day by the hon. Member for Maldon (Sir F. Flannery), that the underwriting of the £25,000,000 could probably be carried out in the City for 5 per cent., was a fairly accurate estimate of the ultimate cost to the nation of guarantees to the extent of £25,000,000. In my opinion, there is no other way of getting things right except by giving the Government power to stimulate trade by guaranteeing loans and credits in such a way as to give the ordinary commercial market a chance of regulating itself or helping, in a state of affairs which is quite unparalleled, to make things move again, and by so doing to benefit our own country tremendously.

I am only sorry that instead of £25,000,000 the Treasury has not infinitely larger powers with regard to credits and loans. I am only sorry that there is not a definite statement as to credits being advanced, on the definite terms laid down in the first Clause, to certain specified countries in Central and Eastern Europe. I believe that it would be a wholesome business proposition on the part of this country to give a credit to Russia. I believe that Austria is in need of a credit of that kind. I believe that by the wise guaranteeing of credits to the Balkans there is a possibility of helping infinitely in the employment of our own people and finally helping towards the enrichment, not only of our own people, but of the peoples of Europe generally. I welcome the first step of the Government in this direction. I hope that that step will be followed by other Governments which are in a position to help to set things moving again. Because I believe that the Bill does not go far enough, and I believe that we are in a position, and that it would be a sound business proposition, to grant credit, and because I believe that these credits are necessary, I cannot follow my hon. and gallant Friend the Member for Newcastle-under-Lyme (Colonel Wedgwood) into the Lobby in support of his Amendment.

While there is a great deal in the speech of the hon. Member for Preston (Mr. T. Shaw) and also in the speech of the Mover of the Amendment, with which I am in full sympathy, I do not feel that I can see eye to eye with either of them. Speaking the other evening on the Second Reading, I think one of the first things I said was that I was frightened at the area over which the Chancellor of the Exchequer proposed to spread his net in looking out for new business, and that I had been to some extent reassured by his informing the House that the preference will certainly be given to loans designed primarily for the encouragement of enterprise in possessions overseas. I adhere very strongly to that position and, if there is to be any Amendment of the nature now suggested, I would be prepared to support it if, instead of merely cutting out the words "any Government," the Clause were altered so as to exclude any foreign Government. While I recognise the force of what my hon. Friend the Member for Preston has just said, I do not think that that means that the credit of our country at the present time is such that we can afford to dissipate our energies all over the world. We have got to apply our credit and our means in those directions where they can produce the greatest immediate benefit and the greatest permanent benefit.

The Empire certainly does require special and energetic development, and if that be done it will make absolutely certain that orders will be immediately placed in this country for large amounts of engineering and other equipment, and the trade that flows from that will flow through British channels and we shall get a double benefit. For that reason, and in view of the fact that in this country we are suffering from restricted trade and great unemployment, our money should be applied in a direction in which it will go beyond securing a temporary benefit and will secure a permanent benefit for us. If we guarantee the loans of small foreign Governments all over the world we shall not be sure that the money will be laid, out in the first instance in the manner in which we hope it will be, and still further, we shall not be sure that the trade which may arise in 'consequence of the expenditure of those loans will flow back into British channels. That, to my mind, is a most important point. Something like 75 to 80 per cent, of our Empire trade flows in British channels. Where the British flag flies there is the tendency for British trade to run. That is an advantage which we cannot afford to disregard, and for that reason, unless the Amendment is restricted in the manner which I have suggested, I am not prepared to support it.

If the Government wishes to guarantee loans to Russia, Austria, or South American Republics, let the Government say so, but do not let us have a Clause which will allow such a thing to take place without the Government making it clear to the Committee that it does desire to guarantee loans to foreign countries for the purpose of stimulating the purchase of goods in this country. I agree in the main with a great deal of what has been said by my hon. and gallant Friend the Member for Newcastle-under-Lyme (Colonel Wedgwood), and I agree entirely with what has been said by the hon. Member for Tam-worth (Mr. Wilson-Fox), and I think that if the word "foreign" were inserted before the word "government" it would meet the case. I am thoroughly in agreement with the idea that the Government should give facilities under this Bill to a Government like the Indian Government to raise money, say, for the purpose of great railway construction and equipment in India, but I would not support the Government under this Bill giving facilities, say, to a South American Republic, or, as was mentioned the other night in the Debate, to, say, Bulgaria, to buy up dock equipment or rolling stock and railway equipment in this country for the purpose of developing that country.

I think that the Amendment which the hon. Gentleman proposes would have the effect of specifically including all the foregn Governments and not excluding them. By putting in the word "foreign" before government he will enable the Treasury to advance loans to any foreign Government. He will have to put in the word "Colonial" before Government.

You will have to get a fresh Act for that. I say that if we have the word "foreign" before government it will prevent the sort of thing to which I refer. [HON. MEMBERS: "No!"] Well, it is the other way round. I am not conversant with the drafting of this Bill. What I want to say in the words of a layman is this—I want foreign Governments excluded from the operations of this Bill. Suppose a foreign Government came here to raise a loan for six months for the purchase of railway or dock equipment from this country, under this Clause the Treasury might be induced to guarantee that loan for six months and you would therefore have the Government guaranteeing the six months' Treasury Bills of a foreign Government under this very Clause. That is a thing which I do not think the Government intends. The Government does not intend to guarantee loans to foreign countries at short dates for the purpose of buying goods. For that reason I hope that the Chancellor of the Exchequer by some different arrangement will exclude foreign countries from the operations of this Clause so that it may not be used for their benefit in the manner which I have indicated.

I rise at once in re sponse to the appeal of my hon. Friend the Member for Farnham (Mr. A. M. Samuel). I think that he has spoken under some misapprehension, as I will explain in a moment. In regard to the mover of the Amendment, it was plain that he did not wish to exclude Colonial Governments from the benefit of this loan. At least his remarks with regard to Colonial Governments were of a half-hearted nature. It is obvious that the more we develop the Dominions overseas the greater the benefit which the Empire will derive. Then, in reference to foreign Governments, it is equally plain that he did not wish to exclude them, because his argument was mainly directed to the inclusion of Russia within the ambit of the Governments who may be concerned. Russia is not excluded. Any Government is included within the ambit of this scheme, and I will explain to the House why. Our object at present is to obtain employment for our people. We want contracts which can be placed in this country at an early date, and it is plain that if a foreign Government is in a position to place such an order at once it would benefit your own people if you give it the advantage of this statute, provided that other terms and conditions were satisfactory. My hon. Friend who opened the Debate talked about wide operations, and he used another adjective which indicated that no very great care would be applied in discriminating between the particular applications made. But that is to assume that the Committee which is going to deal with these various applications is not going to do its business properly. Certainly, if I were a member of the Committee, the lines on which I would proceed would be to select among the applications that were made those which gave the most opportunity of immediate work, giving a preference, among those which came from overseas, to our Dominions, and giving a preference also to the loans with the least financial risk attached.

Surely there is a complete misapprehension as to what it means. In many cases it is not because people have not gone to their ultimate credit to raise a loan that they do not need it, but they are not willing to raise a loan at the present time at the price at which money is now. They are waiting until the price is cheaper. What we want to do to relieve our present condition of unemployment is to induce people to place their loans now and their orders now. Then I would regret very much if the Committee were to take the view that we were to exclude the possibility of foreign Governments coming within the ambit of this scheme. In the first place, foreign Governments may have schemes which would produce immediate orders and upon good security. Then another reason. We are all very conscious of the fact that among the causes of the present world depression in trade is the condition of things in many of the countries of Europe at the present time. It simply means this, that the Committee is left to select the applications, which will produce the most immediate employment at the least financial risk, but if you find such an application from a foreign Government why should you reject it? And there may be instances in which there are good reasons for not rejecting it. It may be a country which has done a large business with you in the past, but is still a country which a very little assistance would now set on its feet, with the effect of causing trade once more to flow between its borders and ours. I do not wish to mention any individual country, because it would be a mistake to do so, but Members of the Committee might very readily think of a country, wealthy in all its resources but held up at the moment, a country more willing to pay its debts than Russia, with better security than Russia and with a more ordered Government than Russia.

Russia is within the ambit of this scheme. I do not say more than that. The Bill applies to all countries which put up applications that commend themselves to the Committee on the general lines I have mentioned. Let me take the kind of case in which a foreign country may at present be in difficulties, partly owing to the unsettled state of Europe and partly owing to the distrust of the currency, because it is on the borders of a disturbed State, a country which may still have natural resources that could be very quickly developed if only means of transport were available. In such circumstances, if you have a country which is prepared to place an order to-day for, say railway material or locomotives or wagons, for bridge girders, and so on, why should you not give a chance to that country to place its orders? It all depends on whether the scheme is good enough or not, and of that the Committee must be the judges. The problem is to find immediate employment for our people, and I, for one, would be very sorry indeed if this Committee were to restrict us and rob us of the opportunity of getting immediate employment from a country in which the credit is good.

I have no doubt that the Chancellor of the Exchequer is right in his argument. It is quite true that this Bill is designed to help difficult business to get through. Anyone who knows anything about the City and its financial operations, even in the last two or three weeks, knows that anything like first class business can be done; the banks will see to that. What is left over is the sort of business we want to get in motion. That is the real object of the Bill. To confine the Bill, therefore, to specific countries or only Governments within the ambit of the Empire, is to limit at once the sphere of operations in which that beneficial work can be carried out. I, for one, shall feel bound to support the action which the Chancellor of the Exchequer proposes to take.

The Amendment raises issues worthy of discussion, as to whether this money could be spent with the best advantage entirely in this country or partly abroad. Of that there can be no doubt. We are raising the question of expenditure by foreign governments. It is proposed to exclude any scheme undertaken by foreign governments. Undoubtedly there are many advantages in this money being spent entirely in this country, on capital works in this country. There would be two advantages in such expenditure. In the first place it would not have any effect in further depreciating foreign exchanges. If the result of financing is to increase foreign indebtedness, then there will be a corresponding depreciation in the foreign exchanges, because there is no factor which regulates the movements of the exchanges to a greater degree than indebtedness as between different countries.

There is a second advantage if the money is spent in this country. It is probable that there will be a loss; I do not know to what extent. If the money is lost abroad it is lost for ever, but if economic expenditure has taken place in this country, in electrical developments, in building light railways or whatever it may be, then at any rate we are left with an asset to show for it; we are left with an addition to the productive power of this country. Those facts would be obvious to the Committee that deals with the matter. We must trust them to have some common sense. They are to administer the Act and they are bound by the instructions of the Act. It is laid down that the prime factor which is to influence their judgment in regard to preference for any scheme is the factor of creating employment in this country. But the number of schemes which would be effective for that purpose is very limited. There are many capital schemes which, though they might be undertaken, would require long delay in the preparation of plans and estimates and contracts. That preparation might delay employment not for months but for years. The expenditure which we require is expenditure here and now. Therefore the number of schemes which could be taken up at home is limited.

It is necessary, if there is to be immediate relief, that our purview should be extended as widely as possible and that if there are any schemes of this nature which can be put forward by British Dominion Governments, or even by foreign Governments, they should not be ruled out of the purview of the Committee. There, also, I think the special Committee would exercise common sense. They would consider which of the schemes were most likely to produce immediate relief and which were likely to be beneficial to the Empire as a whole. I am sure that the Government have put forward a sound view in this matter and that there is more likelihood of getting immediate relief if the scope of the Act is made as wide as possible.

The hon. and gallant Gentleman who initiated this discussion deserves to be congratulated. The Amendment has led to one of the most interesting and one of the most illuminating Debates we have had so far on this Bill. But I think he is unnecessarily apprehensive, because up to the present all the discussions of the Bill go to prove almost the uselessness of this Measure. The Government are not going to take any risks of any kind, as far as I can see. It is only the wealthiest of public bodies, the wealthiest of corporations and the wealthiest of Governments that will receive any consideration whatever from this special Committee. The right hon. Member for Peebles (Sir D. Maclean) mentioned the City of London and concerns which are taking first-class risks all the time, and he said that it was only those which were left over with which the Government or the Committee would be asked to deal. In my opinion the Committee is not going to deal with any bankers' leavings in these operations. An hon. Member opposite mentioned the possibility of underwriting this £25,000,000 at 5 per cent. It is well known that the British Government have no such thing as the underwriting of any of their guarantees, but if they did it could be done at one-half per cent, and plenty of people would be only too glad to do it. Why? Because there is absolutely no risk taken by the Government and no risk will be taken by the Committee.

I venture to say that everything we have heard, either from the Financial Secretary to the Treasury or from the Chancellor of the Exchequer, goes to prove that only the wealthiest of corporations will be assisted. There is not a ghost of a chance of Russia or Austria or any of those other countries coming under that heading. Therefore there will be no risk whatever. It is on that that I base my argument that it is a useless Bill. The wealthiest corporations can carry on for themselves. The aim of the Bill is excellent, but the putting into practice of that aim is a different thing entirely. That is why I say the Bill fails absolutely. I have here the words used by the Financial Secretary to the Treasury the other night. He said on the question of the scheme being a scheme for the bolstering up of undertakings which were approaching bankruptcy:

I would remind the hon. and gallant Member that the only question before us is whether or not foreign Governments should be assisted. I think he is going rather wide of that point.

5.0 P.M.

I understood that the Amendment was to leave out the words "any Government," and I am dealing with the possibility of any Government being either kept in or left out. In my opinion assistance will be given only to those Governments which are at the top of the tree in their financial security and credit and do not want any assistance. I wish to impress upon the Government the necessity of widening their discretion or of widening the discretionary power of the special Committee, so that the Bill might be of use to all Governments and all corporations, provided they are not in a state of absolute bankruptcy. I trust when the Committee comes to do its duty it will be on broader lines than those suggested by the Chancellor of the Exchequer or the Financial Secretary to the Treasury.

Before leaving this question there is one point I wish to put to the right hon. Gentleman. It seems to me that in dealing with the question of Government loans you are up against the question of our foreign policy. We are told by the Prime Minister that a certain Committee is going to be set up composed of distinguished commercial gentlemen. Apparently the principal qualification of those who are to decide whether this Government or that Government is to be assisted, will be business experience. Is this Committee going to work in touch with the Foreign Office and is the Foreign Office going to have the power of veto or of encouragement, in regard to its decisions? If that be the case, will this House be given the details of the reasons for the refusal of loans to certain Governments? A purely commercial Committee, I submit, is not sufficient when dealing with foreign Governments because the whole question of foreign policy—which as a rule is hidden from this House—is involved. During the Second Reading Debate, I asked the Financial Secretary to the Treasury whether Russia came within the ambit of this Bill, and he distinctly said "No" as the OFFICIAL DEBATES show.

If the hon. and gallant Member will allow me, I may point out that I was then referring to the second part of the Bill, which deals with Overseas Trade Credits.

I was referring to the whole of the Bill and there is not much different between the provisions for export credits, and the provisions in regard to these loans. Why has Russia been included within the ambit of Clause 1 and why does it not come within the provisions of Clause 2? Is it the case that the Parliamentary Secretary to the Overseas Trade Department is to administer Clause 2 while the Chancellor of the Exchequer is going to supervise the working of Clause 1. The right hon. Gentleman is known, to his credit, as being one of the people in the present Government, who has worked for trade relations with Russia while the Parliamentary Secretary to the Overseas Trade Department is known as one who has intensely opposed any assistance or help being given to Russia, and thus indirectly to the workers in this country. Is that the reason why Russia is to be included in Clause 1 and excluded from Clause 2? The question of foreign loans to foreign Governments is primarily a Foreign Office question and that means it should be under the control of this House. I therefore ask will this business Committee work in co-operation with the Foreign Office and when loans are refused or advised for political reasons, will this House which has to vote the money when it is lost, be told the reasons for that action?

My hon. and gallant Friend's Amendment I submit should have been one to alter the title of this Bill from "Trade Facilities" to "Russian Relief." That apparently was the object of his speech. He shares an obsession in favour of the conscriptors of labour and the persecutors of the poor who, unfortunately, have the Russian people under their iron heel. Surely he must realise that the whole amount which the Government is likely to have at its disposal would be a mere drop in the bucket. Russia is not actually excluded from this Bill, but Russia will be excluded by the Advisory Committee if it consists of men of sense and judgment. It must be perfectly obvious to anyone who does not look at Russia through the reverse end of a telescope, or who has not been subjected to a diet of the soothing syrup of Mr. Krassin's interpreters—who lie in wait for Members of Parliament interested in Russia—it must be perfectly obvious, I mean the way in which this Bill could be "wangled," if I may use the expression—[HON. MEMBEKS: "Order, order."]

I withdraw it, because it is not suited to the dignity of the occa- sion, but I do not know of any expression which more correctly describes the process by which this Bill might be twisted and contorted into a Russian Relief Bill. The hon. Member for Preston (Mr. T. Shaw) asked why we should not give credit to the Bolsheviks. I believe it is an axiom that, in public affairs, we should act with that circumspection and care which we would devote to our own business. I ask the hon. Member for Preston, and those who support him, whether if they had a little money they would entrust it to the Bolsheviks? Are the Bolsheviks the type of people with whom they would bank, for choice? If the answer to that is in the negative, how can they be justified in suggesting that the taxes wrung from the hardly-used, cruelly-taxed people of this country should be handed over to these dishonest and unscrupulous tyrants who would misuse the money and not devote it even to the starving Russians—with whom I commiserate with all my heart—but whom we neither can, will, could, would, nor should, help. I am afraid I must join with my hon. Friend the Member for the City of London (Sir F. Banbury) in regretting the progressive deterioration of the hon. and gallant Member for Newcastle-under-Lyme (Colonel Wedgwood). Nevertheless, he always says something with which I can agree, and he deprecates loans to Greece—which I think would be a scandalous policy on our part—and to Australia. I would like to put it to the House, that one of the principal purposes of this Bill is to assist impecunious and deserving Governments who cannot otherwise raise money. Take, for instance, some of the small colonies. There are small colonies which cannot raise any money, and yet are producers of cotton, tobacco, and other products, the receipt of which into this country would enormously develop employment in Lancashire and elsewhere. It is to assist in such purposes that the Bill is to a great extent intended. I disagree with the hon. Member for North Armagh (Sir W. Allen) when he said that only rich nations and wealthy corporations would benefit under this Bill. In that case there is no object in having it. If it is only going to guarantee gilt-edged securities, what is the use of making all this fuss about it or bringing it before the House of Commons? It is not the rich and well-to-do nations and it is not the wealthy firms; it is those who are deserving but who cannot carry through at the present moment, who will, I presume, be helped. If that were not the case my interest in the Bill would be very much diminished. I would ask for some appreciation as to what is the true inwardness of the Amendment, and I hope my hon. Friend will at least have the saving sense of decency to withdraw it.

I wish to make one suggestion to the Chancellor of the Exchequer. I agree with him that the words "any government" should be left in, but my point is that you should consider a country like Austria which is more or less bankrupt. Unless you get Austria back to work and in that way get work from this country to Austria, there will be a great economic problem with regard to that country. I have just taken Austria as an instance. Austria might give a monopoly for certain articles to this country or to France or possibly to Italy. That monopoly would probably require a certain amount of machinery, which would be made in the country receiving the monopoly. That would give employment, and the country which took the monopoly would have to raise a certain amount of capital. That capital might require a guarantee such as is suggested in this Bill. I contend in that way we might give a certain amount of employment here, and if the monopoly were given, say, for 10 years it would be an advantage to us and an advantage to a country like Austria, which is, as I say, more or less bankrupt.

I wish to ask about one point. There are two classes of material, namely, peace material and war material. Peace material would be much cheaper to-day in the countries with depreciated exchanges, which are the countries of our late enemies. It is obvious there is a big temptation to buy one class of material in this country and that is war material. I am sorry the hon. Member for East Nottingham (Sir J. D, Rees) has just gone out, because I can imagine his indignation if the Greek Premier who is touring the continent should come over to this country and succeed in obtaining a guarantee to a loan which would subsequently be devoted to the purchase of war materials which would immediately come within the terms of the Treasury Committee's reference, namely, that it would immediately give employment to a great number of people in this country. Supposing he were to proceed to buy, say, a million shells.

I am afraid my hon. and gallant Friend has not shown his usual care in reading the Clause with which he is dealing. I think his point is brought within the phrase which states that the guarantees to be given are to be in connection with

"the carrying out of any capital undertaking or the purchase of articles manufactured in the United Kingdom required for the purposes of any such undertaking."

I cannot imagine how it is to be suggested that any loan could be given to Greece for the purpose of buying war material in this country. It seems to me to be completely outside the scope of the Clause. I come now to the question put by the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) regarding the foreign relations of the British Government in connection with this matter.

On a point of Order. I gave way to the right hon. Gentleman because I did not wish to delay the Committee, but I had not completed my remarks.

I would point out that, as is sometimes unhappily recognised by hon. Members, there is no limit to the number of times an hon. Member may speak.

I will not delay the Committee much longer. I was led away in making the point as to actual war material, though undoubtedly it is not difficult to imagine the instance, without any degree of contortion, of say, rolling stock for the railway from Smyrna to Eskishehr or Afiun Kara Hissar. That would come within the terms of a capital undertaking, and it would be difficult to distinguish. I want to point out that our Government getting mixed up with foreign Governments in this way may lead to complications of foreign policy, and it will be necessary for the committee of business men which is being set up to work in closest contact with the Foreign Office, in order to make sure that we are not committed on questions of foreign policy by the apparently advantageous terms which might be offered us by a foreign Government for an undertaking which, although appearing on the surface to be a legitimate commercial undertaking, is really in essence a continuance of warlike enterprise against some of its neighbours.

I think the right hon. Gentleman has said that the supply of materials of war would not be a capital undertaking, but I turn to the definition of a capital undertaking in the Bill, and I find that it is an undertaking involving capital expenditure. If the provision of a warship for a foreign Power is met by means of a loan, that is capital expenditure, and that is a capital undertaking within the meaning of the Act. This definition is a very wide one and, I think, in some respects a dangerous one, and I hope later, when we come to the Sub-section which deals with the definition of capital undertakings, to raise several other aspects of the matter.

I beg leave to withdraw the Amendment, having expressed my views and heard the Government's views on the subject.

Amendment, by leave, withdrawn.

I beg to move, in Sub-section (1), to leave out the words "corporation or other body of persons," and to insert instead thereof the words "statutory authority."

This Amendment is placed on the Paper for the purpose of getting some explanation as to the way in which this part of the Bill will work. I think we are correct in assuming that this Measure is an emergency proposal, and that the total amount of expenditure is to be limited to £25,000,000, while, in the second place, the applications must be lodged within twelve months of the Act coming into operation. The discussion on the preceding Amendment makes it clear that there are broadly two proposals—first of all, the proposal to give guarantees in the case of foreign Governments, and, secondly, what I should call a guarantee that is going to be given for the promotion of capital under- takings in this country likely to provide employment. That second point is the point which I have under consideration in moving this Amendment. If the overseas part of this Clause succeeds to any considerable extent, it is tolerably plain that the amount of money which will be available for home purposes may be comparatively small, and it is, therefore, very important indeed that we should understand quite clearly how we are going to proceed. If we have a limited amount of money available for capital undertakings in this country which are likely to give employment in the immediate future, then, clearly, we must deal with people who can make a big proposition. There will be no time to deal with a mass of small applications, and that is very largely the burden of my fear in connection with the retention of these words "corporation or other body of persons" in the Clause.

The Chancellor of the Exchequer will probably agree that, in the interest of the efficiency of this part of his Bill, a preference should be given to people who can offer employment in these capital undertakings on a fairly large scale, and I think that, looking to the needs of the local authorities in this country at the present time, it is beyond all doubt that they can absorb quite readily the whole of the guarantees which will be available. I do not altogether exclude some public companies, but I respectfully ask the right hon. Gentleman whether it is worth while, in an emergency measure for 12 months, to run the risk of having to consider a large number of comparatively small applications by a committee which must overtake its work at the earliest possible moment if it is going to do the slightest good at all. I say nothing at all about the general principle or the doubt which is present in all our minds on this side of the House as to the wisdom of the Government coming in behind private enterprise, because I think it must be admitted that some selection will be inevitable. There will be ill-feeling and difficulty, which I believe is unnecessary and should be avoided in the circumstances. For these reasons, therefore, I beg to move that we restrict the Clause in the way that I have suggested.

The object of this Bill is to give every possible opportunity of providing immediate employment that can be offered, and therefore I am very anxious not to restrict it by any form of limitation which would rule out any scheme which would appear on the face of it to give employment to people at once. If we should confine applications to statutory authorities, that would have the effect of depriving many large corporations which are not statutory authorities of the opportunity of offering work which they would otherwise readily do. I have heard, for example, of work which would come under the scheme of a very large limited company, which would give work to three very large ports in this country at the present time, work which in amount runs into millions. I do not say that their proposals are proposals which will necessarily be accepted by the Committee. I do not know, and I do not know what the merits are. All I know is that they would be prepared to put work in hand of a very large capital value, and at three ports in this country where unemployment is, unfortunately, very prevalent. I think it would be very unfortunate if we ruled out a case of that kind, and it certainly would be ruled out by limiting the Clause to statutory authorities.

I entirely agree with what my hon. Friend the Member for Central Edinburgh (Mr. W. Graham) has said, that this sum is very limited and therefore cannot be given over a large number of applications. I fear that the small applications will have a comparatively small chance of acceptance. You would necessarily select those which would afford the most employment, and that means a large expenditure, which small firms would necessarily scarcely have it in their power to undertake. For that reason, I think the applications for small sums would probably not have a very good opportunity of being accepted, certainly in the earlier stages of this matter; I think it would be the larger applications which would have the preference, but my hon. Friend will realise why it is that I do not want to restrict this Clause in the way he has suggested.

The main argument underlying the speech of the right hon. Gentleman has been that all these loans will increase employment. If he really thinks it possible to increase employment in this way, I think he is on I the horns of a dilemma, because £25,000,000 is obviously absurd when you could, by spending £250,000,000, give ten times as much employment as you can by spending £25,000,000. I am afraid I do not share his optimism as to the possibility of making work for people by spending money, and least of all by advancing money to private capitalists with which to play the familiar game of "Heads I win, tails you lose." The situation is this. If this Amendment is carried, we do not start the fatal enterprise of trying to create employment by the State financing private capitalists, and the private capitalists doing what they like with the money advanced to them by the State. We have never before advanced money to private capitalists without some sort of control over the actual administration and expenditure of the money, and the right hon. Gentleman excuses it now by saying it will make employment. If it does make employment let us carry it through, but let us be quite clear that many of us on this side of the House do not believe that you can bolster up the present capitalist system in that way. We believe that the State's money should be used for developing either national or else co-operative undertakings, and not be given to private capitalists, so that if the private capitalist loses the State loses, and if the enterprise is profitable the private capitalist wins.

This Bill is an experiment in State socialism. It is an attempt by the State to bring together the buyer and the seller. Under the Bill the Government are going to guarantee a large sum of money to bring these two individuals into contact with each other. As the House has decided on that principle, I hope this Committee will decide to place complete power in the hands of the Committee, so that this attempt by the State to further industry may receive full support, not that I anticipate much actual business will result from this Bill; but it is an attempt by the Government to create employment, although the money which will be forthcoming through the Bill will require to be raised by credit, and not out of savings by the people. On the one hand it will increase employment, while on the other hand it will help the ultimate return of trade to this country. For those reasons, I hope the Committee will not accept this Amendment.

Although I am in agreement with the Government in seeking to provide work, and anything that can be done to increase employment meets the necessities of the moment, I confess that I do not like the wording of this Clause, especially as it applies to the private person£"or other body of persons." I do not altogether like contracts made which can become profitable conerns outside of our own country, and to the detriment of ourselves, even if the company is formed in our own country. We have an example to-day of the contract entered into with Australia for their lead ore. The result of this is that today private companies are making fortunes in Australia, while in this country there is not a single metalliferous mine at work. Every individual man is out of employment, and has been so for practically 18 months, with no possible prospect of getting employment, as there is no necessity for the ore. There is no sale for it. They cannot dispose of it, and, further than that, the Government receive thousands of tons every month which they cannot dispose of. There is not a spelter works working. They are all out. You have to sell your ore at less than you pay for it. You have got to sell it to other countries at a big loss to yourselves. You have to sell it to Belgium and France, and they are converting it into metal and sending it into this country, with the result that every factory is idle. That contract runs until 1929, and you have got to take the output and pay for it. Therefore, you have got to be very guarded in making these contracts, and in backing up public companies in matters of this kind.

I had a case put into my hands only this afternoon, which, to my mind, shows a scandalous state of affairs, and if I trespass only a fragment out of the way, I hope, Sir Edwin, you will permit me to do so, because it illustrates the point. I have had brought to me a statement of a company being formed, the money raised and application made for men, the whole business being ready to start of running 'buses on the streets of London. The great London omnibus company at once threatened to crush them out of existence. Their threat was not effective. It was not sufficient to threaten the people who had bought their 'buses and engaged men, thereby finding employment for a number of people previously out of work. The result was that only a day or so ago the big London omnibus company, by threats, induced them to sell the whole concern. They buy them out, lock, stock and barrel, and pay compensation, and they close down the business, with the result that the men who are thrown out of a job bring me their statement to-day. A public company can become a public monopoly, and, instead of utilising the powers which the Government is willing to give them to find employment, and to extend their operations, they become a monopoly, which compels others to keep off the ground. Instead of increasing employment, they are preventing people from being employed, and so making the state of the unemployed market worse than ever. Therefore, you have got to advance with great consideration, taking care that in attempting to help one man you are not injuring a much larger number.

I did not intend to intervene in the discussion on this Amendment, but the previous speaker seemed to me to be going against his own argument. The Amendment is to exclude ordinary private enterprise, and yet he instances as one of the reasons for confining the expenditure of money to statutory bodies a contract which was entered into by a Government Department with a private concern. Surely, if money is going to be lost like that, it is safer to confine it to the private concerns which are going to make money.

The contract was made with the Australian Government, and private companies are then brought in as a result.

That is exactly what I say, and it shows the desirability of confining this, as far as possible, to private enterprise, and I think the country is generally agreed about continuing that policy. Another point, I think, has been overlooked. The £25,000,000 referred to by no means represents the capital expenditure involved in this matter. We can safely assume that the wages, as a consequence of granting this sum of money, are going to be five or six times as much. It will mean £125,000,000 to £150,000,000 benefit if properly applied. There is another point my hon. Friend mentioned with regard to monopolies. It is proposed to confine this to Government and statutory authorities. The great difficulty to-day is with the thousands and thousands of private concerns throughout the country which are employing men in every trade and every union, and are prevented by a lack of credit from doing business. Are we going to stop the men employed in those industries from engaging in their own profession and trade, and push them into industries and trades in connection with public utility service, for which they have no training, and to which they are not accustomed? I hope the Government will not accept the Amendment, because if there is one thing essential at the present time it is that confidence should be increased in private business, and any restriction of credit and development of private companies is going to be a very serious matter.

I wish to make some remark from the standpoint of the small local authority. As I gathered from the statement of the Chancellor of Exchequer, he himself is quite conscious of the limited nature of the sum proposed. The right, hon. Gentleman believes that the probability is that this money will be on the whole disbursed amongst the larger concerns rather than the smaller ones. As one who represents a small authority, I would like to draw the attention of the Committee to the danger of that eventuality. It often happens, and it does happen in my particular area at this moment, that in areas of small authorities, which are weak financially, you have a very grave unemployment problem.

We are dealing now with schemes under this system of guaranteeing loans. The hon. Member talks about the smaller authorities. I suppose he means the local and municipal authorities of the country. But other provisions are made for them. The Government is providing 65 per cent, of the interest and sinking fund for a period of 15 years for any local authorities' schemes designed to give employment at the present time, which are not of a remunerative character. On the other hand, where the work is one of public utility, which the local authorities are carrying out, as, for example, a tramway system, which will be remunerative in the end, the Government is providing half of the interest for five years. That is the assistance which is being given to local authorities for such schemes as those, and when I was speaking of the smaller ventures, which would not stand so much chance under this Act, I was referring to the fact that those people who were prepared to spend the most money to give employment would get the preference.

I am obliged to the right hon. Gentleman for his explanation, but it only strengthens the point I wish to make. When the time comes, I should like to say something with regard to the smaller local authorities.

On a point of Order. Is the hon. Member speaking to the Amendment or to the Bill?

I do not know that I can call the hon. Member to order because he is speaking on the Bill, but, as I understood the Chancellor of the Exchequer, and if I understand the Amendment, the question of the local authorities does not come in at all. If the local authorities do come under the scheme of the £25,000,000, then the hon. Member is in order.

It is perfectly clear that a local authority may promote a capital undertaking, not only under the other parts of the scheme, but also under the benefits of this Bill, but I was pointing out to my hon. Friend, when he complained that the smaller local authorities might be left out of this Act, that really a better provision is made under the other scheme.

I understand that the hon. Member supports this Amendment because it would confine the guarantees to statutory authorities. If he desires to direct his observations to that point it will be in order.

Exactly. I was going to say that, in my humble judgment, the provision already made is hopelessly inadequate, so far as smaller local authorities are concerned, unless they can come in under this particular provision, and the observation I was going to make was that the smaller local authority will be very much handicapped in its application, simply because it will not be able to provide employment for the same number of people, perchance, as the larger concerns. For that reason, I think we ought to enter a protest against this provision, lest the smaller local authorities may be handicapped in the direction I have indicated. Therefore, I support the Amendment as put forward by my hon. Friend.

I happen to be a member of a very large authority, that is the Manchester City Council, which is anxious to proceed with work involving a very large capital expenditure. It would be well if the Committee knew how much employment could be found if a given sum of money is spent on capital account. Manchester Corporation, for instance, proposes to spend approximately a million of money, and the total number to be employed in connection with that expenditure will not be more than 1,200 for a period of nine months. That will give an indication to the Committee what can be done with £25,000,000.

I support the Amendment for another reason. I want local authorities to have some of this money because during the period of the War a good deal of work was left over that could be done now. If put into operation it will find a great deal of employment. I might give an illustration from the city in which I live. We are very anxious—and I hope the Chancellor of the Exchequer will take note of this—to proceed with building a good number of secondary schools. That will give employment, and also more employment, because I am of opinion that if we commence operations in a given sphere, work begets work, and we will find more employment in that action. Let me say I am not quite sure whether I made my point clear to the Chancellor of the Exchequer a few moments ago, but I think it is a very important one, and I would urge that, whether or not this Amendment is made, Regulations or plans in connection with this capital expenditure shall be made that no public authority shall be allowed to receive money from these funds in cases where they propose to transfer the money in relief of the rates.

I thank the Chancellor of the Exchequer for his explanation. It goes a long way to meet the difficulty, and I beg to withdraw my Amendment.

Amendment, by leave, withdrawn.

The following Amendment stood upon the Order Paper in the name of Sir J. D. REES: In Sub-section (1), after the word "corporation," to insert the word "company."

I previously pointed out that this Amendment was unnecessary, and I call upon the next Amendment.

With all respect, may I say I wish to move the Amendment? It is quite true that corporation may include company, or a body of persons may include a company, but is it not also true that the word "corporation" suggests rather a municipal corporation? [HON. MEMBERS: "No!"] Well, that is the Bill as I understand it.

I proposed not to call the Amendment of the hon. Baronet, but if he can satisfy me that it is necessary and can direct his observations to that point of view, I shall be glad. His Amendment seems to me to be unnecessary, and that is why I did not call it.

It would not be admitted, naturally, if superfluous; but I think this will depend upon the construction of the words. We do not know how a Court may interpret the words. I do not feel quite certain, accustomed as we are in these days to such strange rulings in Court, which way the Court would interpret this. It is conceivable that the Court might say that the Legislature, sitting not far from the City of London, if it had meant "company" would have said "company." As there will be some considerable competition, let me say, for the benefits of this Act, I submit it is not so certain as it might be thought that the word "corporation" includes "company." If you, Mr. Deputy-Chairman, rule that it must necessarily include "company," and that there is no possibility of it being otherwise ruled, I shall not move my Amendment. I submit, however, that in so doing you are, with all respect, taking upon yourself the functions of a Judge as well as that of Deputy-Chairman of Committees.

Perhaps I had better give the hon. Baronet the benefit of the doubt, and allow him to move his Amendment.

I beg to move, in Subsection (1), after the word "corporation," to insert the word "company."

I move the Amendment for the reasons I have already indicated, and I suggest it is desirable that the word "company" should be inserted. As a matter of fact, this assistance will be more required by companies than by what are commonly and in ordinary parlance called "corporations."

On a point of Order. May I ask how it is possible that companies should not be a body of persons? How can they be anything but a body of persons?

I said earlier that I had some doubts on the matter, but I gave the hon. Baronet the benefit of it.

On the point of Order raised. May I submit, if that be the case, that there is no need to put in the word "corporation," because a corporation, with equal certainty, is a body of persons, and the drafting needs revision and my right hon. Friend's criticism and contention is right? I want, however, to submit that it is exceedingly desirable that the word "company" should be inserted for reasons I have briefly indicated. It requires some courage to move this Amendment, in view of the way my hon. Friend the Member for the Forest of Dean (Mr. Wignall) came heavily down upon companies and said they were all liable to become monopolists. That is not the case. They have not the chance in this country—in view of the competition. Neither would monopolists reduce employment, because even if they did succeed in knocking out the smaller companies, I suggest they would not diminish employment, but only the number of companies at the top, not the number of employee and servants at the bottom. When the hon. Gentleman falls upon the companies, I wonder if he realises that the capital of the companies is not generally in large parcels, but that nine-tenths of it is contained in small parcels?

I reiterate that that is so, and I speak by the book. It is necessary to say so because of the unreasoning prejudice against the system in which the capital of the country is bound up. Such language is bound to do harm and is based upon a want of information. On the whole I submit it is desirable that the word "company" should be inserted, and, therefore, I move my Amendment.

We had some eloquent speeches from my hon. Friend in the course of the Debate upon the Finance Bill. If I am not in error he took some part in urging me to withdraw or, at least to mitigate, the Corporation Profits Duty, and that was largely because of the fact that he was interested in a large number of companies. He asked me at that time to get rid of the incubus under which the companies were suffering in having to pay the Corporation Profits Duty. I do not accept his Amendment because I am perfectly clear that the word "corporation" includes the word "company."

Then I beg leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

I beg to move, in Subsection (1), after the word "undertaking" ["carrying out of any capital undertaking"], to insert the words

"not connected with any industry protected under the Safeguarding of Industries Act."

In moving my Amendment I should like in a few remarks to say how I dislike this Bill—

It is very undesirable for hon. Members to begin a speech by explaining their dislike of the Bill. We are not discussing the Bill now. The hon. Member must move his Amendment and speak to that.

I just wanted to explain thus far. The Government are desirous that this money shall be spent well, and I am desirous that as far as possible that the money should go into what I conceive to be the best direction. I consider myself there is plenty of scope for this money to be utilised in the way either of public services in relation to which there are unlimited opportunities and other objects desired by the Government, for the purpose of creating employment, thus saving time and giving satisfactory results. If we proceed on the lines proposed I can foresee considerable expenditure, for I can imagine private traders and private firms who are taxpayers, and contribute their quota, all applying for loans or guarantees, and there will be scope for disappointment and annoyance when one taxpayer is successful and another is not. I do not put it higher than that for the moment.

My Amendment takes quite a new direction, for the purpose of introducing capital. As hon. Members know, the Government already have done something in this direction. Not alone have they guaranteed, but they have invested money in, certain industries, for instance, dyes, which, perhaps, is not bringing much satisfaction to the investors. The same thing applies to the case of a cellulose company who are making chemicals. There is a large amount of Government money already invested in that matter, with what, if I may say so, are disastrous results. Concerns like the dye industry are receiving protection, and have already received public money, and may apply to receive more money. Why should the shareholders in concerns like that be placed upon a different footing to the shareholders who may feel inclined to invest their money in any new works set up under the Bill known as the Safeguarding of Industries Acts? There are something like 6,000 different items under that Act. Suppose a number of firms decide to manufacture many of these commodities, it will be, indeed, a difficulty for an Advisory Committee to pick and choose amongst those who make applications. There is also the point of view that one desires that the taxpayers' money the Government are guaranteeing should not be put into concerns unless there is a reasonable prospect of the guarantee not being called upon. When one realises that in a great number of commodities which come under the Safeguarding of Industries Act, payment is small and the plant costly, one can well imagine that whatever assistance they get from the Government—even with the 42½ per cent, of the Government promise—the guarantee will certainly be called upon. Not alone will it be called upon, but the people who invest their money on the strength of the five years' protection which they are to receive and the fact that the Government are backing these concerns, will at the end of five years have a very strong case of going to the Government and demanding that the Government shall continue for a further period the protection which has been given to them. That has been the case in the industries in the case. That will undoubtedly be the case in the future. For these reasons this Amendment has been placed upon the Paper, and I shall be glad to know what are the views of the Chancellor of the Exchequer upon it.

6.0 P.M.

I think my hon. Friend who has just spoken allows these matters to trouble him a little too much and there was no need for him to ride his favourite hobby on this occasion. It is true that the Safeguarding of Industries Bill sets up a certain amount of defence for a class of articles which during the War we found were absolutely essential to the life of the country, but in which our manufactures were deficient. Why should one of these particular industries be cut off from such aid as this Bill would give if in point of fact it is going to provide employment immediately? I do not wish to mention any particular industry because it might be thought I was encouraging that particular industry, but if it should be proved to the satisfaction of the Committee which is going to be set up that by a guarantee they were going to provide an opportunity for providing employment in a trade where there was much unemployment, upon what ground can it be suggested that that particular industry should not be assisted simply because it happens to be one of the safeguarded industries?

If employment can be made available, why should it not be done? The object of this Bill is to provide employment where unemployment is prevalent, and I ask hon. Members to keep that in view and judge our measures by that test.

I shall vote against this Amendment if it goes to a Division. We have already agreed to insert certain words in the first part of the Bill. The first line of Clause 1 now reads:

"If the Treasury, after consultation with the Advisory Committees appointed by the Treasury for the purpose of this Section, are satisfied—"

then money can be lent. It seems to me that we have to provide for the largest possible increase of employment. That is the whole object of the Bill, and I cannot conceive of any argument to limit the scope of the Committee which would at the same time be consistent with the main object of the Bill, which is to provide employment. Why not offer the largest possible field of selection for the Committee, and let them have everything in front of them? I should have rather supported an Amendment to extend the scope of the Committee's discretion. It is quite conceivable now that there may be something excluded which otherwise might have come within the ambit of the Bill.

The Chancellor of the Exchequer seems rather annoyed, because the hon. Member for Whitechapel (Mr. Kiley) has again drawn attention to the right hon. Gentleman's spoilt child, the Safeguarding of Industries Bill. I know that a father is sometimes ashamed of his child, and I quite understand why the right hon. Gentleman the Chancellor of the Exchequer is thoroughly ashamed of his miserable brat the Safeguarding of Industries Bill, but nevertheless we who protested day and night against that Bill are not going to be so tender in regard to the right hon. Gentleman's feelings upon this matter. If we think that certain industries have enough protection already we are not going to allow them to be still further bolstered up by this Measure. When that miserable Bill was brought in we were told it was going to give employment, in fact, the terms of the Bill say that in the case of dumped goods from countries with collapsed ex changes a case had to be made out that the industry was being adversely affected. Those engaged in these industries may go to this secret Committee, and they will go with their tale of woe, and draw upon the whole body politic to further bolstering up and underpin their rotten concerns. The right hon. Gentleman spoke about the next war and certain commodities we might require, and he said that it would be a good thing to subsidise these concerns at the expense of the community. In my part of the country they used to plant a yew tree in the front garden—

That argument might be in order upon the Safeguarding of Industries Bill, but it does not seem to be relevant to this Amendment.

I could not resist attempting to answer the right hon. Gentleman's war-like reasons which he gave in opposition to this Amendment. If the industries which are safeguarded by these barriers under the Safeguarding of Industries Bill cannot flourish they must be uneconomic, and we should not tax the whole community further in order to bolster them up. The Financial Secretary to the Treasury and the Chancellor of the Exchequer told us that only solvent concerns with good credit need apply for this assistance. If a man can bring sufficient pressure to get protection and if even then they cannot flourish, they are not concerns of the first order, and ought not to have further protection under this Bill. The money we are supplying for credit is really only a drop in the ocean. It is only £25,000,000. The great basic industries of this country, such as the steel trade, shipbuilding, agriculture and so on fortunately do not come under the Safeguarding of Industries Act, and that is where we ought to spend some of this £25,000,000 instead of utilising it for protecting and still further bolstering up such industries as the manufacture of dolls' eyes and dyes which have been such a failure. Let the industries which have to run for shelter under the skirts of my right hon. Friend's Committee stand on their own bottoms and not come to us to guarantee a loan. I hope my hon. Friend will press his Amendment to a Division.

The Chancellor of the Exchequer, in his usual good-natured way, criticised the hon. Member for Whitechapel (Mr. Kiley) for obtruding his favourite hobby, the Safeguarding of Industries Bill, on this occasion. The right hon. Gentleman said, Why deny to these trades the benefit which this Bill will give to them? Our answer is simple. Already the State has granted peculiar privileges, at the general expense of the taxpayer, to these industries, and when the State is again being asked to find large sums for these same industries such proposals ought to be very carefully examined. The amount under the Bill is limited, and the demands from all quarters no doubt will be many and various. I do not think it is asking too much of the Government, when they are finding this money, not to grant a further privilege to these favoured and protected trades.

In moving my Amendment I tried to make it clear that I was offering a suggestion that this very limited sum of money could be much better applied in forms of public service than applying it to the protection of certain industries. I was urged to do that by the unfortunate experience of the Government in their investments in dyes and cellulose. The experience of the Government in this respect has been so unfortunate that I thought it well to utter a word of warning in case they were going to use this money in a similar way. However, I do not wish to press my point, and I ask leave to withdraw my Amendment.

Amendment, by leave, withdrawn.

I beg to move, in Sub-section (1), after the word "undertaking" ["capital undertaking"], to insert the words "which will be either immediately or prospectively remunerative."

The object of this Bill is to authorise the granting of loans to capital undertakings. My Amendment will define more narrowly what are capital undertakings. There is no definition of them in the Bill. A capital undertaking may be useful, but that does not seem to be enough. Suppose that the loans is not met and the Government are called upon to pay the principal, it will be rather bad for the Government if they are left with an undertaking on their hands which, although it may be useful, is of no pecuniary value to them. The object of the Amendment is to insure that the undertakings for which these guarantees are given shall be either immediately or prospectively remunerative in the sense of producing revenue, and if that alteration is made the Government then will, at any rate, have some asset in their hands against the money which they have advanced and which they may be in danger of losing. There are many undertakings in themselves quite useful in respect of which corporate bodies might ask for a loan, to enable them to carry them out; but which would be of no value to the Government if called upon to take them over. Take for the instance a promenade along a sea front. It may be very useful to the community, but it would be of no value if it fell into the hands of those who advanced the money. Therefore I want to insure that instructions are given to the Committee so that they may confine the loan to undertakings which will be of some value to anyone who may happen to have to take them over. The Amendment is a perfectly reasonable one, and I hope the hon. Gentleman will give it favourable consideration.

I do not think there can be any dispute about the object of the hon. Gentleman, but there may be a difference of opinion as to the desirability or utility of inserting these words in the Clause. Personally I do not think they would be either desirable or useful. These matters are to be dealt with by a Committee of business men, who will apply to their work, it is to be presumed, business principles. Indeed, they could do nothing else in the matter. How could we place a statutory obligation on the Committee of this nature? It is much better to leave these things to the common sense of business men, and I trust the Amendment will not be pressed.

Amendment negatived.

I beg to move, in Sub-section (1), after the word "purchase," to insert the words "at current market prices."

It will be admitted that this is a somewhat more substantial Amendment than the last. It is brought forward because of the enormous fall which has recently taken place in the cost of all kinds of articles with which the powers granted under this Clause may be concerned. At present there are large stocks in the hands of merchants which they have acquired at a much higher price than they will be able to charge when they sell them the goods. I have put down the Amendment as the result of something which appears in the report of the Auditor and Comptroller-General on the Appropriation Accounts for 1919–20. I want to call the attention of the Committee and of the Government to what appears in that report, which gives a history of certain negotiations and agreements entered into on behalf of the Government to supply equipment and stores to General Denikin. An arrangement was made for a commercial firm to purchase and ship goods up to the value of £500,000, and to obtain payment from the Denikin Government. The agreement embodying that arrangement was torn up. The War Office decided as a matter of equity and law to recognise the firm's claim which was submitted at a total of £483,300. It appeared on examination that about 83 per cent, of the commodities had been purchased from three firms in which the plaintiff firm was largely interested and that these subsidiary firms had brought a part of them from the Disposal Board at much lower prices.

In these circumstances, the War Office decided to settle the claim for £430,000 us against the figure of £435,000 advised by a firm of chartered accountants. It was not suggested that the War Office showed any lack of care in drawing up the original agreement, but it was felt by the Auditor-General that the transaction was one of which Parliament should be made aware. This illustrates conditions which are liable to arise when what is virtually public money is dispersed by private firms either on an advance of cash, or with a contingent promise of repayment. The Amendment I have put down is meant to insure that the money provided under this Bill shall not be given to bodies of persons or corporations that will buy for their own benefit from individuals with whom, they may be concerned because, they have the goods in stock. It was done in the case I have cited, and as certainly will be done again unless steps are taken to prevent it. We cannot be parties to any such transaction. I submit that this is a point of very real substance, and the fact that the Auditor-General called the attention of Parliament to it shows its importance. This sort of business has happened before, it may happen again, and now we have an opportunity we should take means to prevent such a scandal recurring.

Surely Amendments of this kind are really trifling. The hon. Member appears to be trying to provide against every detail of business mismanagement. You cannot do that in an Act of Parliament. Ordinary common-sense tells one that if goods are purchased they should only be purchased at the current market rates. If we begin to do this kind of thing there will be no limit to it. The hon. Member might as well introduce an Amendment to provide that no business shall be done with undischarged bankrupts or with persons who have been convicted as criminals. Ordinary business precautions will, of course, be taken.

I am unable to agree with my hon. and gallant Friend (Major Wood) that there is much more substance in the present Amendment than in the last. I sympathise with him in the object he has in view, but surely this is a case where we must have some confidence in the men we entrust with this work who will not require such elementary directions as these.

Amendment negatived.

I beg to move, in Sub-section (1), after the word "articles," to insert the words "other than munitions of war."

I take it we do not want to bolster up any more wars, and as I understand the Government are willing to accept my Amendment, I will content myself with formally moving it.

Amendment agreed to.

I beg to move, in Sub-section (1), after the word "manufactured," to insert the words "or produced."

When I put this Amendment down I was thinking of the necessity of helping our coal export trade. Coal is produced in this country, but it is not manufactured. Other matters also have been brought to my notice as deserving of inclusion under this heading, such as herrings. If we are going to apply this Measure to manufactured goods only, then I suggest we may cut out the opportunity of giving useful help to other industries equally deserving. May I just say a word about our coal export trade? At the present moment we are having tremendous difficulty in recapturing that trade. We have lost our markets. They were largely lost during the War and during the period before the coal stoppage, when we were prevented from sending coal to any country except France and, to a small extent, Italy. At that time we could have sold coal at very good prices all over the world, but we were not allowed to do so. In my own constituency we used to export before the War 13,000,000 tons of coal annually. During the War we were only allowed to export something like 500,000 tons, and that was limited to France and Italy almost entirely.

When coal came to be decontrolled, although we could sell it more cheaply, the Americans had got the South American market, the Japanese had got the Chinese market, and so on; and at the present time we are still further handicapped by the reparation coal from Germany, which is going to France, and the French are actually selling some of the reparation coal in Scandinavia, Spain, and even as far afield as Egypt. They are taking some coal from us, it is true, but only coal of a certain very high quality for mixing with the German reparation coal for special purposes. We are having great difficulty in selling north country coal at the present time. I have only brought forward the coal export trade as an example, but it is a very important case. When this coal goes abroad the ships that take the coal bring back wheat. If we cannot sell our coal, the ships go out in ballast, and the wheat pays a double freight and the price of the loaf is kept up. I am not so familiar with the trade as to be able to go into the whole of the reasons why in certain circumstances the Committee might favourably consider assistance to the coal export trade, but it is not only a matter affecting the collier and the mineowner. There is the whole undertaking of shipping coal on board ships, and the employment of merchant ships which are now idle and of the seamen on whom we depend so much. It might, therefore, be advantageous to bring the coal export trade within the ambit of this Bill. There are also herrings and other commodities which are not strictly manufactured, but which give a great deal of employment. Moreover, trades that are once started again would probably run by themselves. In these circumstances I hope the Government will accept these simple words. They would not be a direction to the Committee. The discretion of the Committee would remain, but they might be very useful.

Perhaps it will shorten the proceedings if I say at once that the Government will be able to accept this Amendment. I would remind the hon. and gallant Member that we are only dealing in this Bill with capital works, and I do not think that the inclusion of the words "or produced" would really have very much effect, because articles needed in connection with capital works are manufactured, and it is difficult to see what other articles will be needed in that connection. It is, however, in con- sonance with the general theory and scheme of the Bill that these words should be added, in order to give it as free a scope as possible.

Amendment agreed to.

I think the next Amendment, in the name of the hon. Member for West Middlesbrough (Mr T. Thomson)—in Sub-section (1), to leave out the words "required for the purpose of any such undertaking"—is contingent on a former Amendment which has been disposed of.

I beg to move, in Sub-section (1), after the word "Kingdom" ["to promote employment in the United Kingdom"], to insert the words:

"and that the loan cannot be raised on the same terms in respect of interest unless guaranteed by the Treasury as hereinafter provided."

This Amendment requires no argument. If a company is able, without a Government guarantee, to raise money as easily as the Government, it is not the sort of body which the Government desires to assist, since it can obviously do without such assistance.

There can be no disagreement on the question of policy with regard to this point. It has been said, both by my right hon. Friend when he introduced the Bill and by myself on another occasion, that it would be an essential condition of the giving of a guarantee under this Bill that capital could not be raised without such assistance. But I think the Amendment now suggested comes under the same description as some with which we have already dealt. It is really unnecessary to put these words into the Bill in order to make plain a binding obligation that must be perfectly apparent to any business man. If I thought it in the least necessary I should not hesitate to accept it, but I think that there is no such necessity, and that it would only be cumbering the Bill with unnecessary words.

Will the hon. Gentleman bear in mind the possibility of a firm seeking to raise a very large amount of money—say, £2,000,000—and of the Committee having before them the suggestion that the firm might go to the banks or any other source for half the amount if the Government would guarantee the remainder? That would leave the Government with more guarantees at its disposal in other directions. If the Financial Secretary would keep that in mind and pass it on to the Advisory Committee, it might be useful to them.

Amendment negatived.

The next Amendment, in the name of the hon. Baronet the Member for East Nottingham (Sir J. D. Rees)—in Sub-section (1), after the word "guarantee," to insert the words "or provide,"—is not in order because it goes beyond the Resolution on which the Bill was founded. The Resolution, as regards Clause 1, contemplates guarantees only, and not the provision of money. Therefore, I cannot accept this Amendment.

I submit readily Mr. Hope to your ruling, but I really put this Amendment down in order to find out what was the exact intention of the Financial Resolution—whether it really was intended simply to guarantee, and in no case to provide. I suppose this matter will be explained, perhaps by rules; but is it intended that, when the Advisory Committee have ruled that some application is good, the applicant, armed with the guarantee, may go to the banks or the market to raise the money, and that, if he cannot raise it, it will in no case be provided under this guarantee?

No doubt there will be an opportunity of raising that question, perhaps on some other Amendment, but in any case on the question that Clause 1 stand part of the Bill. I have very carefully read through the Financial Resolution, and it certainly does not seem to allow of any part of this money being actually provided by the State. I think that the same observation applies to the next Amendment, in the name of the hon. Member for St. Rollox (Mr. G. Murray)—in Sub-section (1), after the word "principal" ["either interest or principal"], to insert the words "or defray part of the principal or interest on such terms and conditions as they think proper." I do not know whether the hon. Member wishes to make any explanation.

The object of my Amendment was to provide for large schemes of Empire settlement, and I intended, had I been allowed to move it, to amend it by adding the words "for the purposes of Empire settlement." My reason for wishing to include this Amendment in the Bill was that since the War 60,000 men have settled overseas under the various schemes of emigration, and there are still a further 60,000 applicants.

I am afraid it is clear that the Amendment is not in order. The hon. Member has not touched on the difficulty which I have in accepting it.

I understand that I can raise the point under the Bill which will be brought in next week to provide £10,000,000 for relief, including £300,000 for emigration purposes, and I propose to do so then.

I am not rejecting it on the ground that it is frivolous or unsubstantial, but on the ground that it is not in order because it is not covered by the Financial Resolution on which the Bill is founded.

On that point of Order. Is it not covered by the Financial Resolution? In Clause 1 power is given to guarantee principal and interest. Surely, in case of default by a company, and of it is becoming necessary to put into effect that guarantee, it is necessary to have some provision which will enable payment to be made? Do not the words proposed give effect to that? Perhaps I am wrong in my reading of the Bill. The Financial Secretary may be able to clear up this point, but I see nothing in the Bill at present which empowers the Government actually to pay the principal and interest in the event of default. Surely they must be in a position to do that?

That may be a want in the Bill which can be supplied after wards, but this Amendment clearly contemplates the actual provision of capital by the Government.

I beg to move, in Subsection (1), after the word "principal" ["either interest or principal'], to insert the words

"Provided that in every case where a guarantee is given it shall be a condition that the Treasury shall supervise any expenditure incurred as a result of the guarantee."

I hope the Government will be able to accept this Amendment. We on these benches are extremely anxious that when these guarantees are given there should be, for the public safety, adequate Treasury supervision of the expenditure for the purpose of which the guarantee has been given, in order that no charge may be made that Government guarantees have been given without adequate, supervision in the public interest. I do not want to labour the question, but simply submit it to the Committee in the hope that the principle embodied in it, namely, that a State guarantee shall carry with it adequate protection by the State for the public, may be accepted.

I hope the Government will see their way to agree to this Amendment. It has a great deal of precedent behind it, and the sum involved is not by any means a small one. If we look at Government commitments in the past, from the days of the Suez Canal to the present day, we shall always find that where public money has been spent by Parliament there has always been adequate supervision. In some cases it has not been effective, notably in the case of the Cellulose Corporation, the beet sugar industry, and dyestuffs; but the fact of its being ineffective in some cases in preventing failure is no reason for departing from what is, after all, an excellent principle from the point of view of representative government.

I think the Government should hesitate about accepting this Amendment. It will occur to many hon. Members that, if it were included in the Bill, it might quite easily defeat the whole policy. To begin with, the company or individual, or it may be a Dominion, seeking the assistance of this grant, will become responsible for the payment. On the other hand, the Treasury will make exhaustive inquiries as to the stability of the firm or individual seeking the guarantee. Having taken all these precautions to secure that a guarantee shall not be given to worthless persons, I think that if you carry it beyond that into anything like Government supervision of the actual expenditure, it will have such a hampering effect that the very best firms would not in those circumstances seek a guarantee. The only hope of the country's recovery at the present time is that we should liberate as far as possible the energy of the people. Let us encourage in every way the full blast of individualism in our people. That will be seriously interfered with if you allow a Government Department, simply because it has given a guarantee for a loan to a responsible firm, to criticise through officials, and take exception here and there. No business would be done, and no firm worthy of the name would seek a guarantee on such terms.

I think the hon. Member (Mr. Shaw), in moving the Amendment, really puts to us a proposition which is unpractical and which, if it were practical, would be undesirable. I agree with most of what has been said by the hon. Member who has just sat down. As regards the general principle that public control must go with the expenditure of public money, of course there is no doubt, but that principle is not involved in this case, in the first place, because in effect the money being expended will be in a far more vital sense the money of the undertaking which is expending it, and their interest in making it go as far as possible, and in earning the best return under the financial scheme of the Bill, will be very much more direct and immediate even than the interest of the taxpayer; in the second place, because there is a substantial measure of discretion in selecting those parties whom you are going to assist and guarantee. That gives you the means of keeping out people whom you cannot trust. But it would be an impossible and unpractical thing for any Government Department to re-embark in the control of industry to the extent suggested by the Amendment.

Before the Amendment is withdrawn, I think the right hon. Gentleman opposite has not put the case quite fairly. This is not, I think, the first time public money is being spent without public supervision, and there are two special reasons why in this case there should be public supervision. In the first place, we want to see that the money is expended in such a way as to secure the maximum of employment. It is very important, if you are passing this Bill so as to increase employment, that you should not have the money used for amalgamation of companies or for any sort of purpose which does not immediately result in employment. I do not see how the Treasury can possibly guarantee the way in which this money will be used, after they have once got the guarantee and raised the loan. That is one reason why it is very important that there should be some public supervision. Parliament is passing an Act with a certain definite intention in view, of increasing employment, and the supervision ceases at present as soon as the loan is granted. But there is another reason. We want to see that the State is not involved in a liability in respect of this money. We have advanced money before to private enterprises. We advanced money, for instance, to British dyes. We advanced money to Anglo-Persian oil. We advanced money to beet sugar. We advanced money to buy Suez Canal shares. In all those cases the Governments of the past have made special effort to see that the public money so invested has been safeguarded by direct administration of the funds. In all those cases they have put a Government director on the board of the company receiving assistance, so that the interest of the public from a financial point of view should be looked after. I think they were quite right in doing so. I am quite certain that in the cases we are dealing with now it is infinitely more important than it was in the case of British dyes or the Anglo-Persian oil that we should have Government supervision.

The hon. and gallant Gentleman is speaking to the next Amendment.

Amendment, by leave, withdrawn.

I beg to move, after the word "principal" ["or of either interest or principal"] to insert the words

"Provided however that any corporation or other body of persons who may propose to take advantage of such Treasury assistance shall agree to add to their board of directors such nominee as His Majesty's Government may direct who shall have the duty of reporting to Parliament any action by his board which he holds to be to the disadvantage of the Treasury or contrary to the intentions of Parliament in passing this Act."

I was hoping to save time by dealing with this Amendment on the question which was then before the Committee. The argument is this. Under the present Bill there is no provision for the expenditure of public money. The suggestion I make is that no public money should be advanced to any private capitalist body without the presence on the board of directors of some representative of the Treasury to see that that money is spent in such a way as will not involve the State in any expenditure and will ensure that the money should be spent on creating employment. I am quite aware that the presence of Government directors on the Board of the Anglo-Persian oil does not ensure any great control over the administration of its funds, but it is better than nothing, and you are now creating a precedent, which is, to my mind, an extremely bad one. You are voting money for private capital without ensuring any public control over its expenditure. That is not a thing that should go through without protest, and I believe the whole direction is wrong. Where State money or State credit, as in this case, is going to be used, to my mind it ought to be used first in the case of bodies under public control, and where you are going to assist private enterprise you should have representatives of the public or the board to watch over the administration of the money.

I hope the Government will not give way to this suggested Amendment. It seems to me that these Amendments which tend to interfere with private enterprise are more calculated than anything else to increase the unemployment and the bad trade we are suffering from. The hon. and gallant Gentleman (Colonel Wedgwood), I believe with some good reason, considers himself a person not unversed in affairs connected with the management of companies, idustrial and other. Would he, if he were on the board of directors of any of these, for a moment consent to the board having put on it a nominee of a mortgagee or a bondholder?

The hon. and gallant Gentleman knows perfectly well the difference between providing money and guaranteeing money. The point I put to him just now was not as to putting on the board of directors the nominee of a mortgagee or of someone providing the money. The people providing the money are the shareholders. When the Government provide money as a shareholder they may put someone on the board of directors, but the Government are not even the people who are lending money, but only people who are guaranteeing money, and they have no excuse whatever for interfering in a matter of business.

This is a very unfair proposition, indeed, as it suggests that a corporation that proposes to take advantage of such a system—not a corporation which does take advantage of it, but which proposes to take advantage of it—should nominate a representative of the Government. Imagine the position. There is a company in New Zealand that proposes to ask help from the British Government, but because they propose to take advantage of it they must be asked to put a nominee of the Government on the board of directors. It is about the most preposterous suggestion that has ever emanated, even from these benches.

Instead of having a director, I suggest that there should be a return made monthly to the Treasury of how the company is doing.

The suggestion which the hon. Member opposite has just made is far preferable to the one my hon. and gallant Friend (Colonel Wedgwood) is making. If he had been able to show that the experiments which the Government have indulged in in the past in the way of putting directors on to British Dyes and all the other companies to which they have advanced the taxpayers' money had resulted in success, it would be different. But every one of the companies the Government have put money into has turned out to be a failure, and I am very reluctant to encourage them to proceed in that direction any more. But I gladly welcome the suggestion of the hon. Member (Mr. Wise). Perhaps the Government will give that further consideration.

If these concerns are going to be a success, you are not going to help them to success by imposing vexatious restrictions on them in the conduct of their private business. These returns which would have to be presented to the Government will mean a great addition to the staff of the Treasury. Excuse will be made for engaging new people to check returns, to devise the forms in which they are going to be made, and for finding work for the Stationery Office by printing these forms on bad paper, which the company would have to fill up. All that would prevent efficient business. The expedient of putting outside directors on a board, so far as I am aware, nearly always fails, because unless a board of directors is composed of people who all have the same interest at heart, the success of the concern and of the shareholders, it does not result in harmonious working and efficient management. Supposing a man is to sit there more or less as a Government spy, he will find in practical working that his efforts will be frustrated, not perhaps consciously, but people will conduct a good deal of the business of the board outside. They will take their decisions and come to the board to have them confirmed. I think business matters must be left to be dealt with in the ordinary way in which business is conducted, and if the Treasury attempt to impose these extras-ordinary regulations they will only defeat their own object and make it more difficult and more expensive for these companies to conduct their business.

Those who have spoken on this side of the House have pointed to the inconvenience of this proposal to the companies concerned. I should like to point out that there is also very great inconvenience to the Government. If the Government, in guaranteeing a loan, put a director on the board, he makes himself responsible for what happens. The suggestion of the hon. Member (Mr. Wise), I think, is open to the same objection, and the only way is by taking a certain amount of responsibility for the policy of the company.

I quite agree that it would not be inadvisable to have a monthly return, but I think that monthly return ought to be certified by an auditor. I am certain that if a company knows such a return has to be made it will be much more careful than it otherwise might be. I hope, therefore, the Minister will see his way to accept this most reasonable suggestion.

In the case of the Suez Canal shares, in the case of the Beet Sugar Company, in the case of the Dyes, in the case of Celluloid and all the other rotten concerns, except the first I mentioned, which has been a very good one, all the others have been hopeless failures so far, and have caused unemployment instead of giving employment. Why was it right in those cases for the Government to have a nominee on the board of directors to watch over the interests of the taxpayers' money, and why is it wrong to propose that another company which may get £5,000,000 of this money guaranteed. [HON. MEMBERS: "Provided!"] It may come to the same thing if the money is lost. Why is it wrong in this case to have a Government nominee? We are only asking for some explanation from the Government on this matter. We are not putting the Committee to a lot of trouble by dividing, but I think the Government" might, at any rate, outline to the people of the country through us what is the reason for this changed policy.

I hope the Government will condescend to give us some reply. It is not merely that a suggestion has been made for directors, but a counter-suggestion has been made by business men in this House and has been influentially supported even by the followers of the Government themselves.

Yet the Government sit down in absolute silence and show their contempt for the whole thing. I do not think that that is the way to smooth the path of legislation here. I earnestly hope the Government will condescend to show that they have, at any rate, sufficient respect for the House of Commons to answer the arguments brought forward by their own supporters, even if they do not condescend to answer those of Members of the Opposition.

I am perfectly certain the Committee will not think I am showing any discourtesy to them. What has been the progress of this Amendment? It has been supported by the hon. Member who moved it. It has been universally rejected in the Committee. [HON. MEMBERS: "No!"] Every speech made in regard to it has been in favour of its rejection, and even one of the hon. Members who constantly acts with the hon. and gallant Gentleman who proposed the Amendment—

I think the occasions on which they have gone into different Lobbies could be counted on the fingers of one hand. As I say, the hon. Member, who usually supports the same proposals as the hon. and gallant Gentleman, has disavowed the Amendment, because this practice on past occasions had only led to the utter failure of the company with which it was connected. In those circumstances I have yet to learn that it is necessary that the Government should make some pronouncement on such an occasion as that. The other matter, which has been only tentatively suggested by two hon. Members on this side of the House, is obviously one which requires much greater consideration. It is one to which no reply can be given on the spur of the moment. I think the hon. Members made it without regard to the future and to the point which will be discussed later, namely, that which deals with returns to be made with regard to the profits and to the guarantee. I hope the Committee will acquit me of any imputation of discourtesy.

I am very much obliged for the right hon. Gentleman's reply, which contained no arguments whatever. His comparatively short experience in this House will perhaps have left him unaware that many Amendments are moved in order to elicit the Government's opinion on the question in point. The question in point now is how the Government's supervision over the actual expenditure of this money is to be ensured. We have not heard anything as to how they propose to see that the money is spent in providing employment as Parliament directs. I am quite well aware that the Government are faced with a very small Opposition and can treat it with a certain contempt. I warn them, however, that when the Bill comes to be worked, and it is found to be a complete failure, the people of the country will not be so ready to excuse them for their want of care in thinking out these ques- tions. I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

I beg to move, in Sub-section (1), after the word "principal" ["either interest or principal"], to insert the words

"Provided, however, that among the prescribed terms shall be such as will prevent a liability falling upon the Exchequer for the payment of interest on any loan during the construction of the capital undertaking and prior to the undertaking becoming a dividend-earning one."

I am afraid I must apologise to the Committee for my lack of skill in drafting Amendments, but the actual proviso and safeguard I want to introduce is this. When railways or docks are being constructed, a railway company raises capital sufficient, not only to pay for the construction of the railway or dock, or whatever it may be, but also to pay interest on the money during the course of construction. The railway or dock company pays the interest regularly from the time the capital is subscribed, although it may not be getting any return until three or four years later on the money invested. What I want to provide against, and I am quite certain the Government intends in some way to provide against it, though I do not see it in the Bill, is the taxpayer of this country being called on to pay interest during construction and because no actual dividend is then being earned by the concern. I want to be satisfied that the amount of the benefit that private enterprise is going to get out of the guarantee shall be the ability to raise money at a lower rate of interest because the Government is behind the loan. That, apparently, has been decided upon by the House, but I wish that to be the extreme limit of the assistance given to private enterprise. I do not want the different companies—the Underground, the Great Eastern, or whoever it may be—to borrow money on our guarantee and to come on the guarantors during those years while the enterprise is under construction and before it is dividend-earning. If my proviso is not in the correct terms, I hope that the Government will substitute something else, or will provide in some way against what I think will be regarded as an injustice.

I recognise that the mover of the Amendment has called attention to a point which might, in the absence of the skilled direction which will be available, raise a difficult question. In the ordinary case a person, company, or undertaking borrowing money may do one of two things. Either they have got other revenues, from which they pay the interest on the new capital they have borrowed, or else they pay the interest out of the capital which they have raised. The latter is not at all an infrequent circumstance. I would deprecate putting rigid terms of this kind into the Bill, because it might discourage any particular enterprise which could be quite successfully conducted on the second basis to which I have referred.

On the other hand, the Bill does give scope to the Treasury, which, in these cases, will be advised, as has been pointed out, by an expert Committee. The Committee will advise that the loans should be given in such a manner and form and on such terms and conditions as they think proper. I think we should be far better advised to leave it to the skilled knowledge of the people dealing with these guarantees to decide in regard to each particular case the terms on which the loan should be made, rather than to lay down some rigid condition which will make it impossible to give the guarantee under certain conditions. I hope the hon. and gallant Gentleman will not press the Amendment.

Am I right in understanding that the right hon. Gentleman actually contemplates our being called upon under this Bill to provide interest to implement the guarantee during the early years of the loan? If that is so, I regret it very much indeed.

There may be instances in which it is necessary for the Treasury to pay the interest at the beginning of the constructional period. I do not wish to rule out now, by any such words, the possibility of giving a guarantee in such an instance where, in point of fact, the prospect of the subsequent profits of the undertaking is such as to make it certain to the minds of the Committee that it will be very soon producing a revenue. The only result of this Amendment would be, in such circumstances, that the Committee would have to resort to the device of saying, "You shall pay the interest out of the capital which you have borrowed rather than come to us." There might be instances in which that would be a very unwise or inexpedient thing to do. I would beg the hon. and gallant Gentleman not to tie the hands of the people who have to try and work this thing to the best advantage, but to leave them some discretion and room for working instead of providing a rigid drafting which would have the result, on occasions, of preventing a perfectly good concern from getting the guarantee which would yield employment.

I am sorry I did not make my point clear. Is that interest to be funded or added to the debt of the guarantee, or paid by the taxpayers?

Undoubtedly the undertaking is to be liable for any interest which the Treasury has to pay at the beginning in the early stages of the constructional period. That would be wiped out in the case of a company which found itself getting interest paid in the early part of the constructional period, but it would remain liable for the interest. This is only a guarantee.

Amendment negatived.

I beg to move, in Sub-section (2), to leave out the word "twelve" and to insert instead thereof the word "six."

It seems to me that the sooner these undertakings can be got going the better from every point of view. I do not want to be pessimistic, but as things are to-day I think we shall be in a worse state in six months' time than we are now. Therefore, while there is a little confidence and hope about, let us get remunerative and employment-giving undertakings under way. The £25,000,000 is, of course, a very small amount, when we consider the magnitude of the problem and the tremendous extent of the employment-giving industries in the country. The right hon. Gentleman and others have again and again pointed out, and have been loudly cheered by the House, that he who gives quickly gives twice. Therefore, it would be much better to limit the time to six months. If at the end of six months the scheme has worked well, it can be extended if there is money remaining, or, on the other hand, Parliament may be opposed to voting more money. I have my doubts about the scheme, but I hope it will work.

There are any amount of schemes which are ready in connection with all sorts of under takings that are hung up by financial stringency and lack of confidence. People cannot see far ahead, and they do not like to embark on big capital undertakings. I do not see that a 12 months' period is needed to enable these things to be worked out and put before the Committee. Furthermore, the people who have schemes ready, and who have put in a good deal of work in preparing the schemes, ought to get some preference over the people who threw up their hands and said they could do nothing. That preference would be given if the period was shortened to six months. If six months is too short a period, Parliament will meet in the spring and the Government could come forward with some other scheme, fortified and strengthened by the experience and working of this scheme. This Amendment is not put forward with any intention of attacking the Government or the Bill, but with the intention of helping employment. It will not in any way hinder legitimate enterprise.

I do not mind admitting that when we made the original draft of the Bill we had a period of six months in it, but we came to the conclusion, after consideration, that there might possibly be schemes which would be ready just outside the six months which it would be inappropriate to rule out. We thought it would be an awkward matter to come back for further powers to cover such cases. I hope the hon. and gallant Member will take it from me that our second thoughts are best and that he will not press his Amendment.

The right hon. Gentleman has had much better advice than I have had. I will be guided by him and withdraw the Amendment.

Amendment, by leave, withdrawn.

I beg to move, in Sub-section (5), after the word "guarantees" ["the guarantees given"], to insert the words "and the circumstances under which each guarantee was."

Parliament and the country ought to know more about this matter. Simply to say that so much money has been expended is not sufficient. We ought to be told what concerns out of the many who have applied for assistance have been picked, and why the other firms were refused. There is also a point in regard to Government loans and guarantees. We ought to be informed why one Government has been refused the guarantee of a loan to be expended in the British market, and why another Government has received a loan. Hon. Members particularly interested in the Colonies have also pointed out that there may be jealousy between the different Colonies unless the thing is clearly set out. More than the satisfaction of Members of this House, there is the much wider question of the satisfaction of the public. Whatever happens, the members of this Committee will have an unenviable task. They will be blamed by the unsuccessful applicants, and there are people in the commercial community who will say that all sorts of improper influences have been brought to bear.

I have not heard the names of the Committee, but the Government can certainly choose people of power and influence, associated with undertakings, who are so public-spirited that they can be trusted to deal with this matter impartially. Everyone in the country does not believe that, and stories will be put about that so and so favoured a firm with which he was connected. If the Government will issue a short statement to Parliament in the form of a White Paper, showing how the money is being spent, that one of our Colonies received a loan for making lines and bridges in the mountains of its hinterland, or that such and such a country had received a loan because it had a new process for extracting oil from coal, or from water, and it was considered that it would provide so much employment that the Government thought fit to guarantee the loan. The document need not be voluminous. It need not be much larger than the annual Navy Estimates. There will certainly be suspicions, criticisms, and jealousies. Let us, therefore, have some account as to how the money is spent. The more the persons who are the custodians of this £25,000,000 can tell to Parliament and the country the better.

There is a good deal in the speech of the hon. and gallant Member which is well worthy of consideration, but he made one suggestion which I trust the Government will not accept, and that is, the publication of all the cases dealt with. That would be very damaging for the credit of those who had been refused the guarantee.

I did not intend that. I meant the publication of cases where the money has actually been granted.

In cases where the Committee recommended and the Government agreed to give the guarantee there would be no objection to a statement being issued, and I trust that the Chancellor of the Exchequer will give the suggestion his favourable consideration.

It is recognised that there is very much force in the contention put forward, so much force that what has been described as the information that should be given regarding the new guarantees is, in substance, what it was contemplated should be given. It is so desirable that there should be full and adequate information provided for the Government, the House, and the public, that it will be as well to put some actual words into the Clause in order to make that clear. I do not think the words of the Amendment are the most appropriate. I would rather propose the insertion of the words

"and together with particulars of the purposes for which the loans guaranteed were to be applied."

I take this occasion to say that it ought to be widely known that the information which the Committee requires it will obtain for itself, through channels which it will select, and there can be no question of deputations, or what is commonly known as public or private pressure being put upon the Committee for this scheme or that.

I am extremely obliged, and I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Amendment made: In Sub-section (5), after the word "quarter" ["that quarter and"], insert the words "together with particulars of the purposes for which the loans guaranteed were to be applied."—[ Mr. Young. ]

I beg to move, at the end of Sub-section (5), to add the words" and such necessary details of each transaction as may be required for the information of Parliament."

This Amendment deals with the annual statement, and it should be possible for Parliament to be able to require such information. However, I am quite pre pared to be guided by the Chancellor of the Exchequer or the Financial Secretary to the Treasury.

As regards the purposes which the hon. and gallant Member has in mind, I think they are adequately covered by the Amendment which I have just moved.

I bog leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Before the House separates, and I trust that that will not be later than two weeks to-day, I hope my right hon. Friend will be in a position to give the names of the Committee.

The trading public is entitled to all possible explanation of this scheme. No doubt the greater concerns follow these matters with very great care, and have the advantage of the accurate information which is easily at their disposal, but there are many undertakings not concentrated in London which are not in the same fortunate position as the great undertakings, who have huge offices in great commercial centres, and I suggest that as quickly as possible adequate publicity should be given to the Press as to what the Government Measure really means, and the facilities which it is proposed to give. The result of that will be that a very large amount of unnecessary correspondence will be saved. I speak with some knowledge, because I was a member of one of the first bodies set up by the Government at the outbreak of the War for dealing with foreign trade debts, and a great deal of unnecessary inconvenience was caused, and a large amount of unnecessary correspondence ensued owing to a complete misapprehension of what were the functions and the ambit of the operations of the Committee that had been set up. I would suggest that as speedily as possible the trading public should know what the Bill can do, and then they may deduce for themselves what the Bill cannot do. I do not know how far it is possible to make known what would be the Treasury instructions to the Committee. That might also be a very useful piece of information for the public to have.

On the question of the Committee, I am glad that my right hon. Friend has resisted any undue attempts to limit its functions. We know how difficult it is, if a Committee has too many Treasury Regulations imposed upon it, for it to operate at all beneficially. This Committee will undoubtedly consist of men enjoying public confidence, and therefore, within the whole scope of your measure, the right thing to do, to get the best work out of them, is to trust them. They will be undoubtedly men of high financial qualities and wide trading experience, not only at home, but abroad. I am certain from my experience of men of that kind, with whom I have had the honour of serving, that they will discharge their functions without any suggestion of undue preference or favour to anybody, subject to the necessary Treasury control, because I am glad that the full Parliamentary responsibility of the Treasury to this House has been settled on the face of the Bill itself. This is a Committee which is advisory and not executive. Executive power rests with the Treasury, which is responsible to this House, but, knowing how these things operate, I am certain that the Treasury will not interfere unduly, and that the House will have every confidence in the operations of the Committee when it is set up.

There is one point which I was very anxious to raise on an Amendment, but I found it difficult to frame an Amendment on the point which I regarded as satisfactory. The point is—what is a capital undertaking? What kind of scheme does the Government intend to be covered by the phrase? Turning to the end of the Clause, we find "capital undertaking" defined as "an undertaking involving capital expenditure." Does that involve the carrying of stock. There are many firms which would be very glad at present to manufacture, and manufacture largely, not for sale, but for stock. To carry out such an operation they would require a large increase of capital, and the money expended in manufacturing the stock, and carrying the stock, might conceivably, under the definition given, be regarded as capital expenditure. To a large extent that expenditure would be effective for the immediate purpose of providing increased employment. I think, however, that any such operation would involve great danger. It would tend to keep up prices, probably, and there would be a difficulty about unloading this stock in the future, in which a very large amount of the capital would almost certainly be lost. When I tried to frame an Amendment on this point, I came to the conclusion that it was impossible to frame in an Act of Parliament a scheme complete in all its details. It is largely a question of administration. The whole success of this scheme will depend, not on laying down details in the Act, but on the wisdom of the administrators to whom it is entrusted. What is the intention of the Government in this respect? Do they intend to cover schemes for carrying stock, and, if not, will they consider before the Report stage whether they can devise a satisfactory means which would exclude these cases if they require exclusion?

In reference to the view that particulars of this scheme should be widely published, it seems to me that what you want to do, where the amount is so little, is to restrict applications, and that the capital should be distributed to a limited number of large undertakings rather than to a large number of small ones. If a large number of applications were made, the Advisory Committee would probably be snowed under. The Committee would never have time to examine carefully into the details of all. I should imagine that the Government plan would be to have comparatively few applications, all for considerable amounts. There is one precaution which I should like to suggest. The Committee have power to make what conditions they please. I hope that, in making these conditions, they will have regard to the time of the guarantee. It is very much to the advantage of the Government that this guarantee should be for a limited number of years, and in that respect I think that if the Government put a time limit on their responsibility they are very much more likely to avoid loss than would otherwise be the case. That is a matter which is worth the attention of the Government. As I have said, unless these applications are not too numerous, the Advisory Committee might be snowed under, and no proper determination of the claims of the various undertakings would be made.

I hope sincerely that the Government will not do anything to encourage the laying in of stocks. Never in the mercantile history of this country were there so many firms in difficulties owing to the accumulation of large stocks and the depreciation of these stocks. Even co-operative societies are not exempt from suffering heavy loss from laying in stocks. I understood that primarily this scheme was to encourage the export of goods and not the stocking of them in this country. Therefore I hope sincerely that the Government will instruct the Committee not to give any encouragement to the laying in of stocks.

Both the Chancellor of the Exchequer and the Financial Secretary to the Treasury have told us that they are anxious that nothing should be done to bolster up prices or maintain prices where otherwise they would fall. On this point, is it possible to limit the assistance given to the buyer rather than to the seller? It seems to me, under the phrasing of the Clause, that at present assistance can be given to the manufacturer of goods not for stock, but for immediate sale, but to allow a man to come in and to get assistance as a manufacturer would open the door to very great difficulties, because the question is, to whom are you going to give that assistance and is not your assistance going to be in the nature of a subsidy which would bolster up prices, whereas if you limit your assistance to the buyer as opposed to the seller you escape the danger to a very large extent. The case of locomotives and transport workers has been referred to. There is a demand for railways, locomotives or rails. If you could limit the assistance to the corporation that is going to buy the material and to develop the railway you would relieve the Government of the responsibility and the danger of subsidising the manufacturer, but if on the other hand you subsidise the manufacturer of the rails or the locomotives then you have a difficulty in differentiating as to which firm you are going to assist. There is a very big difference between granting assistance to the buyer and to the seller. If you limit your assistance to the buyer you avoid, to a large extent, that danger of giving a subsidy and bolstering up prices. I would like to know whether it is possible, not in the Bill but in the instruction to the Committee, to provide for this case?

I am grateful to the Committee for the assistance which it has given me in regard to this Clause of the Bill. I agree with hon. Members who have said that we must not look for too much under this Bill. At the same time, I am sure that it contains promise of good results if we get it properly into operation, but I would venture to endorse what has been said by the right hon. Gentleman the Member for Peebles (Sir D. Maclean) and the hon. Member for Bridgeton (Mr. M. Scott) that the success of this Measure will depend on the way in which it is operated by the Committee in charge of the Bill. I am sure that we shall be able to nominate a Committee which will command the fullest confidence, not merely of this House, but of the country. Personally I have the greatest possible confidence that we may do a great deal under this Bill to stimulate trade, which at present is bad. With regard to the Committee, I will announce the names very shortly. I hope to be able to do so by next week.

On the question of publication I agree with the right hon. Member for Peebles that the effect of this scheme should be widely known. It is true, as the hon. Member for Limehouse (Sir W. Pearce) said, that you might have a very large number of applications by which the Committee might be overwhelmed, but at the same time you must try to spread the opportunities of employment over the country as far as possible, and if you confine your applications to a few large centres you might be omitting districts in which it is necessary to bring succour to very distressed people. Accordingly it seems to me that applications should be looked for so that the work will be done in various parts of the country and among various trades. It would be absurd if you were to have all the orders confined to one particular trade. You want to have the work spread so as to cover as many industries as possible. From that point of view it seems to be necessary to examine a considerable number of applications rather than to confine the number within narrow limits. Of course, once the Committee lays down its rules and regulations, there can be a preliminary examination and a competent Secretary will be able to sort out the applications. I know that there are difficulties in this matter, but I have not the least doubt that they can be overcome.

An hon. Member put a very interesting point as to what "capital undertaking" meant. The words that we have adopted in this Bill we imported from an Act, which my hon. Friend knows very well, the Scottish Local Government Act, 1889. As the hon. Member can well imagine, "capital undertaking" in that Act is intended to apply only to such large operations and works as county councils and parish councils might happen to indulge in. There was no idea that "capital undertaking" in that Act would cover anything that was concerned with ordinary trading purposes. Reference has been made to the possibility of manufacture for stock being regarded as a capital undertaking. It is true that you require capital to manufacture for stock, but it is working capital that is required for holding stock. Anybody who had to manufacture for the purpose of stock would immediately be ruled out under any definition that could be given to "capital undertaking." I agree that the words lay themselves open to many interpretations. I shall do what the hon. Member suggests, and see whether I can find a closer and narrower interpretation of "capital undertaking."

The hon. Member who spoke last is under some misapprehension as to what the Clause does. It is a guarantee of loans to bodies which are to engage in capital undertakings or for the purchase of articles for the carrying on of capital undertakings. That, of course, is in favour of the buyer. Therefore, so far as I can see, this Clause cannot be used at all for the purpose of encouraging the seller to keep up the prices of his goods. In fact it is a Clause in favour of the buyer. I think the remarks of the hon. Member were more apposite to cases in which credits might be granted to people who wished to sell stocks which they had accumulated, but that has nothing to do with the provision of this Clause.

Exactly how will people apply for the guarantee? Suppose I think I have a scheme for extracting quicksilver from Ben Nevis. The scheme would give a great deal of employment in that beautiful part of the country. How do I go about it? Do I write to the Treasury, or to the Secretary of the Advisory Committee? There is another point. In all Government contracts we have what is called a Fair Wages Clause. I do not think it would be a good thing to hamper undertakings, but I certainly think that where we are giving a Government guarantee and when there is the constant pressure because of unemployment to keep down wages, there ought to be some sort of contract signed by the assisted firm to provide that the Fair Wages Clause will be observed. If the right hon. Gentleman does not care to reply off-hand to these questions, perhaps he would give the matter some consideration?

I take it that the loans to be guaranteed are redeemable loans, that the undertaking will have to make provision for their redemption within a reasonable time, and that the Treasury will not sanction the gauaranteeing of an irredeemable debenture which might run for practically all time?

I cannot imagine the Committee sanctioning the guarantee of irredeemable debentures. I am certain that they will take the line that the guarantee shall be made to operate over as short a period as possible. Applications will be made to the Secretary of the Committee, and his name will be announced with those of the members of the Committee. I should not imagine that a mere statement that you had an idea that there was a place from which you could extract quicksilver would have very much opportunity of success. With regard to the Fair Wages Clause, I ask the hon. and gallant Gentleman to remember that the Government is making an arrangement with a person who is carrying out a contract, which contract will have to be made with the people who are manufacturing in this country. The contract of guarantee will be between the Government and the people who get the guarantee, but those people must make their own contracts for carrying out their work. The Government is not providing the money, and is not lending the money nor granting the money, and so far as the contractor is concerned I am afraid that we shall not be entitled to interfere in any way with his placing of the contract once it has been decided that his scheme is a good one, and that it is not being carried out at such an expense as to make it unprofitable in future. I do not think it would be at all germane to begin a discussion of any question of wages. If we discussed wages and prices of materials we would never make any progress whatever.

Question, "That the Clause, as amended, stand part of the Bill," put, and agreed to.

CLAUSE 2.—(Amendment of 10 & 11, Geo. 5, c. 29 and 11 and 12, Geo. 5, c. 26.)

(1) The provisions of the Overseas Trade (Credits and Insurance) Act, 1920 (in this Section referred to as "the principal Act"), as amended by the Overseas Trade (Credits and Insurance) Amendment Act, 1921 (in this Section referred to as "the amending Act"), shall be extended so as to authorise the granting of credits and the giving of guarantees in respect of export transactions between the United Kingdom and any other country whatsoever.

(2) In Sub-section (2) of Section two of the principal Act (which makes provision with respect to the period within which credits granted under that Act are to be liquidated), for the words "some date not later than six years from the said eighth day of September, nineteen hundred and nineteen," there shall be substituted the words "some date not later than eight years from the said eighth day of September, nineteen hundred and nineteen," and in proviso ( a ) to Sub-section (1) of Section one of the amending Act (which limits the period within which guarantees are to remain in force) for the words "eighth day of September, nineteen hundred and twenty-five," there shall be substituted the words "eighth day of September, nineteen hundred and twenty-seven," and notwithstanding anything in the principal Act as amended by the amending Act the power of the Board of Trade to renew a guarantee may be exercised at any time so long as no guarantee is in force after the eighth day of September, nineteen hundred and twenty-seven.

(3) This Section shall be construed as one with the principal Act and the amending Act, and those Acts and this Section may be cited together as the Overseas Trade Acts, 1920 and 1921.

I beg to move to leave out Sub-section (1).

The object of the Amendment is to confine the scope of the Bill to those countries laid down in the first amending Act, that is, our own Colonies, and, in the words of the original Act,

It may be argued that more immediate results could be expected by applying this Measure to prosperous countries, and that argument, I feel, can be turned into a reinforcement of the argument I am advancing, because if the Measure were applied to prosperous countries, to a more attractive sphere for the exporter, it would mean that the whole of this Measure would be applied to those countries and would be diverted from the sphere where it is required, that is from the countries broken by the War and from our own Colonies. Naturally, the exporter will go to the place where he will get the safest and quickest return. It is true that when the Act was applied to such countries, only some £3,000,000 worth was taken up; but that was not, intrinsically, because it was applied to such countries, but rather because the Government guarantee was not sufficiently attractive to the exporter. If that guarantee is made sufficiently attractive, no doubt the whole amount will be taken up. We are faced with this situation: As the Prime Minister said when he initiated the general discussion, by dealing with the situation in this way—which I think is the wrong way—we may possibly lose a great deal of money, but it is better to risk a loss of money in an attempt to resuscitate the broken countries than to leave them in the condition in which they are at present, that is to say, devoid of purchasing power, down and out. They will remain there until some attempt to set them on their legs is undertaken, and if this Measure is applied to any country, prosperous or the reverse, there is no doubt that only the prosperous countries will benefit, and we shall be having a highly artificial and uneconomic subsidy of exports. I, therefore, hope that the Government will reconsider their decision to extend this Measure to any country, and will confine it to their original intention, while making the guarantee sufficiently attractive to investors to encourage exports to our own Colonies and those countries disorganised by the War.

8.0 P.M.

I observe that in moving this Amendment the hon. Member finds himself in conflict with his leader the right hon. Member for Peebles (Sir D. Maclean), who has a further Amendment to make perfectly certain that we are not going to carry out the terms of this Amendment. I cannot for a moment accept this Amendment. In the first place, the object of all this chain of legislation which the Government has introduced is to provide against unemployment by getting employment in remunerative industries, and by getting trade going again through the normal channels, and in those countries in which trade is most likely to be carried on when the Government assistance has expired. That in itself would be a sufficient reason for widening the scope of the export credit system and extending it through- out the world. What the hon. Member is really proposing is that we should only do business in countries where there will be considerable risk. I maintain that is a thoroughly unsound proposition.

I hope we shall do a great deal of business with the Colonies. Already £18,000,000 has been raised in the London market for developments in the Dominions and the Colonies. If you are going to confine these proposals to countries where the exchanges have been largely depreciated you are taking a great risk. It is perfectly clear, if you are prepared to give away goods, and to give money for nothing you can get any amount of business, but it is not sound business. We cannot afford to be the relieving officers of Europe. It would not be any good to us if we were to put ourselves in that position. This scheme is specially designed so that only business, for which there is reasonable and legitimate prospect of being paid in the long run, will be assisted under it. It would be most unwise to confine its operations to the bad markets. I do not think you will do a great deal of business if you confine your self to the bad markets, unless you are going to put the whole of the risk on the State. I do not think even the hon. Member for Harrow (Mr. Mosley) will suggest that the State should carry the whole of the risk. You will not find traders taking advantage of a scheme in which they carry a solid proportion of the risk, unless there is a reasonable chance of being paid for it. I think, however, the hon. Member has a more sub stantial motive in his mind. He is anxious that we should not substitute this system of government assisted trade wherever it is possible to do trade through the normal channels and on a normal basis. With that I thoroughly agree. Under the scheme no business will be done which can be done by the banks in the ordinary way. That will be assured by the fact that every application has got to come through a bank.

Furthermore, it is more expensive to do business under the scheme—commission has to be paid—and business will not be done under it, which the banks can do. I would like to tell the Committee that, in discussing the scheme with the banks, we did make the suggestion to them that they might act as agents for the Government in operating a portion of the fund. The banks did not see their way to carry out that suggestion, for reasons which I think will easily appeal to the Committee as sufficient. They stated, however, they would give every assistance to the State, and they would pass on, and recommend their clients to put through the Department, any business of a reasonable character which they were not prepared to do themselves, but which they thought could be done through the Department. We have completely safeguarded the position. We do not interfere with the normal channels of trade, but where there is a reasonable chance of doing remunerative business then we come in, and in such a way as makes it possible to carry on business afterwards through the normal channels. If business conies to the Department through the bank under this scheme, the Government guarantees the bill. It passes back into the normal trade channel and is discounted by the banks, and in that way we do not interfere with the ordinary flow of trade. This proposal has been discussed very carefully, not only with the bankers, but with the Chambers of Commerce and other commercial representatives, and I venture to suggest that if there is practical business that can be done, it will be done under this scheme, and that it would be most unwise to adopt the proposal contained in the Amendment.

I am delighted to find there is another Member in the Committee who apparently takes the same view of this Bill as I do. I congratulate my hon. and gallant Friend the Member for Harrow (Mr. Mosley) on observing that the scheme which has been put before the House and before the country is in reality merely a reflex of the Protective system. Instead of the Safeguarding of Industries Act to protect home markets, we are now getting the Bounties on Exports Bill to stimulate exports. Just as you protected the home market, at the expense of all the consumers in the country, so you are going to stimlulate export business, at the expense of the whole of the consumers of the country, likewise. This Amendment is moved to limit the amount of export bounty that can be allotted under the Bill. The answer to it is exactly like the answer given to every other argument raised on this side of the House, that if you touch the Ark of the Covenant you are creating more unemployment in this country. This divinely-inspired Bill, which has sprung from the brains of the Secretary of the Overseas Trade Department and the Chancellor of the Exchequer, is intended to create more employment, and therefore should be given the greatest possible scope in order that it may reduce unemployment. That is, of course, a petitio principii . We do not think it will reduce unemployment. We think the result of export bounties or Protection will be to reduce employment, increase prices, and make trade worse. The speech of the hon. Gentleman, in reply to the Mover of the Amendment, shows matters to be even worse. Apparently, this is not going to be an export bounty on all export trade, but only on bad export trade. It is only the "stumers" that are to be helped. Wherever business is reasonably sound the banks will undertake it, but when anybody bothers the banks with a scheme that they would only put into the waste-paper basket, they will say to him, "My dear fellow, take it to Philip." That sort of business is not likely to be paying business. Under this new Bill we shall be giving bounties to trade in the Argentine, in Chili and in America. That means to say that the Chilians, the Argentinians, and the Yankees are going to buy English goods cheaper than they otherwise could. We are going to assist them with cheaper goods. In other days—in a House of Commons which was not elected in the 1918 election—we had a certain number of people here who rather liked the French sugar bounties, because we got cheaper sugar in this country as a result of the action of the French Government. As an effect of that, we built up the jam business in this country on that cheap sugar. After experiencing that, we think we will be equally kind to all the other nations of the world, and supply them with cheap British cotton and machinery and other goods. It is very nice for the other people, but where do we come in? We come in because this Bill is going to create more employment. There is no answer to that argument. If it is gospel, that this Bill is going to create employment and not reduce employment, there is no argu- ing against it. We must simply bow down and allow experience to teach the Government that tinkering with the laws of political economy does no good.

As an old associate of the hon. and gallant Member who has just spoken, I am glad to welcome his return to the Liberal fold.

I am glad to learn that he does not believe in tinkering with economic laws, and applying artificial means to stimulate the natural flow of business. I do not know how far I may be in disagreement with the hon. Members who sit beside me or behind me, but I am bound to say that it is a source of great pain to me, to be obliged to confess that, for the first time since my hon. Friend the Member for Harrow (Mr. Mosley) has been in this House, I feel myself in disagreement with him. No matter on what subject he has spoken, I have always found myself in hearty agreement with him, especially in those vigorous attacks which he has delivered against the Parliamentary Secretary to the Overseas Trade Department and his colleagues on the other side. I find myself in support of the proposal to extend the operation of the Bill to every country. That in the circumstances is a sound, economic proposal. If you can start business even in a sound country, you must sooner or later beneficially affect affairs in countries which are not so prosperous. Starting a business transaction should be, and very often is, similar to causing ripples by throwing a stone into a pond. Once you start, not merely the machinery but the atmosphere and the flow of business, it inevitably results in increasing business. In this case we want to start in countries where business under normal conditions at present is impossible. As the Secretary to the Overseas Trade Department has pointed out, first-class business is promptly and swiftly done by the banks, and, as I understand the views of bankers, they do not anticipate very great results from this Measure. They do agree, however, that it may, and will, afford some real assistance in getting over what the engineers call the "dead centre," the point where the piston rod becomes stuck, and where it just wants a little more push to get it over that point, so as to get the machinery going again. I must say this of the bankers, that the British banking system is coming very well out of this world disturbance. Whatever may be said about the German bankers, when German finance broke down, it was broken down completely. The French banks, the American banks, the Italian banks—none of them compare in their present position with the amount of world confidence which the British banks have succeeded in inducing and maintaining. They have their responsibilities and they have to be careful of the risks they undertake. Naturally they only feel justified in taking over what may be called first-class business, but there is a large amount of other business which is not bad business at all, which can be got going, and which may be, and I hope will be, got into motion by the operation of this Measure. Therefore I welcome very much the extension of this scheme to any country. I hope the objection which was shown by the hon. Gentleman opposite with regard to the possible inclusion of Russia will not be persisted in. Wherever business can be done—second-class business—let it be done, and as speedily as possible, without any prejudice of any kind. That is, as I suggest, the proper way to do business now. We are in a position with regard to world business, which is in many respects not far removed from paralysis. I do not quite understand how my hon. and gallant Friend (Colonel Wedgwood) founded his argument in regard to giving to foreign countries cheap British goods and cheap British clothes. Surely he remembers this, that if these things go out there, they have got to be paid for, and they are going to be paid for by goods being sent here which British merchants want. What British merchants want they will buy, and they will mostly buy the raw material or the semi-manufactured material which they can usefully and economically develop in these markets.

The Hon. and gallant Member (Colonel Wedgwood) thinks that we shall be able to produce goods more cheaply because we get these credits, but that is not a fact. The Bill does not provide a bounty to manufacturers of a kind that will reduce cost of production.

If it paid the French to give a bounty on the export of French sugar and to pay for that French sugar by buying British goods, then it will pay us to do a similar thing with our export trade in Lancashire cotton goods; but if it did not pay the French to have sugar bounties, it will not pay us to have cotton bounties.

The whole thing turns upon whether you are going to stimulate second-class business or not. First-class business can take cafe of itself. Are you prepared to leave things as they are? That is the whole question. Do you consider that no measures should be taken at all? If my hon. Friends think that, they should vote against this Clause, and, indeed, if that is really their view, why did they allow the first Clause of the Bill to pass without a Division? The principle there is precisely the same; it is only a difference of machinery. I am prepared to stand by the view which I take, that this scheme under the present calamitous conditions should be extended to all countries.

We have heard in calmness the second part of this Bill examined without rhetoric or perorations, and we have heard two sets of opinion—those who object to any sort of artificial assistance to private trade, and the view just expressed by my right hon. Friend, which is that the position is so abnormal that we have to assist in any way we can to restore the trade of the world. If you say that a man who brings a bucket of water to put out a first-class blaze is doing his best, then I think you can apply the same sort of principle to this Bill. It may help a little, and I do not think in this matter you can really distinguish between countries that are first class from the trading point of view and countries that are second class. One example of that that will occur to the Parliamentary Secretary to the Overseas Trade Department, who is in charge of this part of the Bill, is this: Take the case of Brazil. To-day we cannot export our blankets to Brazil—and we have built up an enormous trade in blankets—not because Brazil's credit is not good, but because Brazil cannot sell her coffee—and she has been having excellent coffee crops—to the ruined countries of Central Europe. Today in Europe you cannot get real coffee. What the ordinary native in. Central Europe drinks and calls coffee is baked corn or something of that sort; it is some horrible concoction, and it is only the travelling tourist and such like who can get coffee. We have blanket makers in Dewsbury out of work because Brazil cannot sell her coffee to Austria. The fact of the matter is that you have a complete circle of trade, and if you take out one portion of it the circle is broken, and we all suffer. That being the case, I ask the consideration of my hon. Friends beside me of this point. Any trade to-day helps, but in any case I agree with them so far, that this proposed Measure is utterly inadequate to meet the present state of affairs.

The hon. Member in charge of this part of the Bill said we cannot afford to give things away, but I am going to state quite publicly that it would pay us to-day to export transport and machinery and agricultural implements, and even certain raw materials to the devastated and ruined countries of Europe, even if we did not get paid for ten years. It would actually pay us to-day to send the necessary transport, and rails, and machine tools, etc., to countries like Poland and Roumania, because these things are at present blocking up our storehouses, and the people who make them are out of work. If we should be involved in war, and one of those countries, like Poland or Roumania, were an ally, and she wanted transport for her Army or machinery for making munitions of war, we should send the stuff to her immediately and hope to get paid later on. That is why France owes us £500,000,000, and why Greece owes us so much money. We have been supplying munitions to Greece, and we shall not get paid for them, for the simple reason that the money is used for destroying property, for devastating fields, for killing the young men who would otherwise be producing wealth. There was scarcely an unemployed able-bodied man in this country during the War, but the artificial boom of the War, of course, was followed by the slump. Why not produce an artificial boom today in the way I have indicated? Why not supply the immense needs of Central and Eastern Europe—transport, machinery, boots, and so on? They would be peaceful articles, however, and instead of the boom being followed by a slump, as always happens after a war—as the Prime Minister has just found out in his recent delving into the history of the Napoleonic Wars—you would set the wheels of industry, and trade, and exchange going, and, what is more important, you would also turn men's minds in these countries to peace instead of to war. The trouble is that they are spending more money than they can afford on armies, and attacking their neighbours. Set them working, and turn their minds from military glory to the peaceful arts of industry and commerce, production, and exchange. That is what the Government ought to do, in conjunction with our Allies. They could do it with Germany, who would like it. We shall have to combine with them to pull Europe out of the bog. If we did it with Germany, we should, before long, do it with the United States. I commend that to the hon. Gentleman, and beg him, over the week-end, to read in the OFFICIAL REPORT what I have said. It is the only scheme, I think, to-day, that will save us from first-rate disaster.

This is a very interesting discussion, and I regret it has not taken place at an hour when a larger number of Members could have been able to attend to listen to it. I rather agree with almost everything that has been said, but I think that where I really disagree with the Government is that I do not think that their conception of how to deal with the present situation is a sound one. There seems to have been three ways developed in the course of the Debate of looking at this subject. There is that school which thinks that it is a mistake to interfere at all, that the giving of bounties for exports in the end will do no good, and that it is better to leave things to find their own level. There is a great deal to be said for that, but that is the old laissez faire view. I cannot take up that position. I tried to develop my view the other day on the Russian famine. I am not prepared to let great masses of people starve, even on purely economic grounds. Therefore, I cannot accept that view. Then there is the view raised specifically by this Amendment. Ought you to apply this to the broken countries, or ought you to apply it mainly to those countries which are not broken, because that is really the issue raised by this Amendment. If this Amendment be not inserted, the credits, if they are granted at all, will be absorbed by what the right hon. Member for Peebles (Sir D. Maclean) calls second-class businesses. There will not be much second-class business done in the present sense of the word in broken countries, and that means that you will confine this assistance, so far as foreign markets are concerned, to those countries which in the near future will probably recover themselves. You are going to aid them a little, and you are going, incidentally—and that is the great defence of the Bill—to encourage employment immediately in this country.

I do not say that is altogether a wrong view. I agree with those who say that anything which starts trade is a good thing, wherever it is at present situated, and if this is really likely to stimulate trade—and experts assure us it is—I would not myself be against this Bill. But it starts by taking the trade proposition at this end—consider how you can encourage this end, and do not bother about what is going on in foreign countries. That is the fundamental view which the Government have always held, and I think that fundamental view has got us into a large amount of the trouble from which we are now suffering. I believe it is a profound mistake, and that, on the contrary, all our policy in the last few years ought to have been directed to setting the European countries on their legs. We ought to have looked at it from their point of view, from a strictly economic standpoint. That is really what is wanted. What we are suffering from is not anything wrong in this country, but the inability of foreign countries to trade with us, and that seems to me the fundamental difference of opinion.

That is exactly what you do not do. You are only going to help those countries which have second-class business. They will recover by themselves sooner or later. [An HON. MEMBER: "Czecho-Slovakia!"] You might help even Czecho-Slovakia in that sense. You will improve things a little there, but you will not really set right the great difficulties of Austria, Poland and Russia, which are the three greatest, and until you get those right, you will not get trade right. That is the point. I do not know that this Bill will do very much in any case. That is more a matter of general policy, and of measures which really ought to have been taken in the last three years, but which it would not be in order to discuss at this moment. But I must say that all my economic sentiments go in favour of the Amendment. I agree that it is, perhaps, an attempt to graft on to this Measure a conception of the economic situation of Europe which this Measure is not big enough and strong enough to bear, and it might be in that case my hon. Friend would not do anything by his Amendment. But, so far as he has raised the specific issue that if we are really to succeed, what we have to do is to restore foreign markets—gand it seems to me it is the main issue he has raised—I find myself in entire agreement. I think he has really touched the weak spot of the economic policy of the Government, and, unless the Government amend that point of view, and look at it more largely from the new point of view, rather than the old point of view, I am sure all their measures will fail to restore the economic position.

This is, I believe, the third time Members have been invited to join in the Committee stage of an Overseas Exports Bill. On the two previous occasions it has been my privilege to join in the discussion, and to offer one or two suggestions. They were treated with the usual disregard, and I do not know that those I make to night will share any better fate. But I feel it necessary to make one or two observations for the consideration of the Minister in, charge. When the first Bill was introduced, we were told that there were two objects in view, one to promote trade and the other to assist countries suffering from the War. After a considerable period, as there were no results to be achieved in either one or the other, the Government decided to amend their Bill and try further experiments. As the result of both Bills, they have now come back with a third venture, and they are altering, as I think unwisely, the method and also the area to which they had previously given some thought. In the case of the countries whose currencies have been affected in so vital a way, they have decided to disregard applications, and to concentrate on what they consider to be spheres which will offer them better results and perhaps more business. If there is this money available, and they have a desire to promote trade, perhaps that is the best form to take. But as they have decided that countries whose currencies are falling to such an extent that they ought to be excluded, I would like them to tell us about places where there is no currency at the present moment—Portuguese East Africa and places like Mauritius, where bankers will not give exchange now, because, I understand, of disputes between bankers on the spot as to what constitutes sterling currency for their local coinage. I have an instance, in the last few days, of a very important export house saying that they have orders for thousands of pounds' worth of British goods, but on account of two banks, one an English and the other a Portuguese, being unable to agree between themselves what shall be the sterling there is no business whatever doing in that particular part of the world. That is a matter which this Bill, which has been introduced to help trade, might endeavour to meet. What does the right hon. Gentleman intend to do with regard to India? Is it intended to do Indian business? I understand the attitude adopted in this country by the banks doing business on account there is that because of the large undischarged liabilities of goods which they have shipped out to that country they are not prepared to encourage other goods to go: it will have some effect upon the goods not cleared, and will, therefore, bring down the price and inflict losses upon them because of the money which they have already advanced.

That means that if trader A has not met his engagements and the goods are out there, the bills will not be purchased from buyer B because he may be able to sell those goods cheaper than A, who has not taken up his goods. That, I understand, is the position in India to-day, and it is an intolerable position.

Yet, as I understand it, there is no arrangement or contemplated arrangement by the Government in this respect, because these goods must first of all go through the banks. If the banks will not help, then that attitude is not likely to assist this Committee which will have charge of the acceptance or non-acceptance of the bills. That will not in any way help to increase our trade in India, which at the present moment is reduced to a very small point. I would, therefore, like to have some information as to how the Minister proposes to dead with that part of the world. The hon. and gallant Member for Newcastle-under-Lyme (Colonel Wedgwood) seems to be concerned as to what will happen as regards the money advanced, and fears the Government will have losses. I beg to reassure him on that point. There is not much possibility of that, because the same controlling authority, I understand, which will have charge of the working of this Bill in its early stages will be the authority later. There will be very little doing, and my hon. and gallant Friend need have no anxiety as to what will happen.

The Noble Lord the Member for Hitchen (Lord R. Cecil) invariably lifts every subject with which he deals from the drab and dreary depths of materialism into the higher altitude of international altruism. But I do not gather from the speech to which we have just listened whether or not he was supporting the Amendment to omit this Subsection, which, in point of fact, is in favour of what some hon. Members desire, since it deals with export transactions to any country whatsoever, and does, so far as it goes, enable the Government to take other measures which I understand the Noble Lord wishes to be taken. The Noble Lord said the weak spot in the Government's policy was that it was not sufficiently expansive, and did not sufficiently take into account the needs of all Europe. But why confine ourselves to "Europe? It was not sufficiently expansive in its ambit! Nevertheless, the Sub-section before the Committee includes a provision for assisting these countries. Therefore, if I understood the Noble Lord's speech, it was that he disapproved of the Government wiping off that weak spot which was apparent in their economic and unemployed policy. Therefore the Noble Lord's speech, in spite of its eminent altruism and its sympathy with Europe in general, leaves me in considerable doubt whether it was or was not his intention to support the Amendment.

He says we must not only remember this island. Of course, we must not. But we must remember sometimes that we are on the banks of the Thames and not on the banks of the Danube or the Volga‡ Every time I come to this House when this Bill is under discussion, I find myself in considerable doubt whether hon. Members are really dealing with unemployment in this country or in the other countries of Europe. How, under this Bill, can the Government possibly put Poland—that light and irresponsible country—in the position suggested? How can it deal with Russia, into a small pocket of which the whole of the United Kingdom might with the greatest ease be placed and lost on the map? These things are impossible. I do submit that in dealing with this Bill there would be some advantage in confining ourselves to this fairly narrow, yet, as I think, exceedingly extensive provision. This Sub-section, which is the subject of the Amendment, is really a remarkable advance, and I think a very bold one. The doubt is whether it is not too bold! It ought not to be criticised from the point of view of being narrow-minded, and the question, to my mind, is whether we are justified here, as representatives of British constituencies, in guaranteeing credits and giving guarantees in respect of export transactions between the United Kingdom and any country whatsoever! This is a question that we have to consider upon the Amendment, not the internal state of Poland, Austria, or Russia.

The Noble Lord said he agreed with almost everything that had been said but he did not agree with the Government. But part of what has been said has been in favour of the Government and part against. Again, I cannot understand what is the actual substance of the speech to which the House has just listened. The Noble Lord said—and I most heartily agree with him—that we ought to deal with broken countries. But what is the use of making distinction between countries that are broken and countries that are standing up? Any country that promotes employment in this country is good for us, and we need consider it from no other conceivable attitude. That is the only point. Hon. Members who keep on bringing in their altruism, their charity, and their desire that nobody should suffer in the whole world and that everybody should have a chicken in the pot, as Henry IV. said, are really clean off this Bill. Of course second-class business will do much good, and, of course, first-class business will best be able to look after itself. But these are mere platitudes. When we say that our policy is to set the countries of Europe on their feet it is absurd to talk in that way, because even when this country was in the possession of the savings of years it was not in a position to finance the whole world, and still less can it do that when it has spent all its savings, and is groaning under a debt of £8,000,000,000. An absolutely unreal attitude pervades the Debate when these high altruistic altitudes are reached. The hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) did appear to address himself quite closely to the question before the Committee. I submit, however, that the hon. and gallant Gentleman left out of account entirely the resources of the Government, and what is the provision made in this Bill? The proposal before the Committee is that Sub-section (1) of Clause 2 should be omitted. The question before us is, What is going to be the result of omitting that proposal? The effect will be that it will cut this Bill into two parts at once. Those who are assuming that high altruistic attitude must come down off their perch, and they must consider the effect of omitting this Sub-section, because it divides by one-half what the Government is proposing to do.

I should almost apologise to the Committee for referring to the proposal before us, and also for stating what kind of business can be done under it so remote has been the discussion. Under this Sub-clause the Government are able to promote business to a most remarkable extent. There are an immense number of companies in this country and they, after all, carry on the business of the country, although they are regarded with suspicion in certain quarters. Under this Subclause the Government is able to authorise the granting of credits, and that should satisfy the most ardent altruist inside or outside of this House. The Government will be able to keep upon its legs and prevent from extinction a large number of formerly flourishing and, on paper, still perfectly solvent concerns, which, for want of the kind of assistance which will be given under this Sub-section, and which this Amendment proposes to delete, will not be able to tide over a difficult time. Such help may perhaps avert something like a crisis, which may be much nearer than many of those who look at these things from outside are aware of. Having ventured to come back to the Bill and to the Amendment, I do say that it would be a most disastrous thing if this Amendment were carried, and I shall vote against it with all my heart.

I will answer one point which was raised by the hon. Member for Whitechapel (Mr. Kiley) with regard to financing Indian trade. That is a matter which I have gone into very fully with the Indian banks operating in the East, and also with a body which is most likely to be able to express a considered opinion on the subject, namely, the Manchester Chamber of Commerce. I am assured that there are ample credit facilities available, and that the banks are only too anxious to finance every bit of sound business that can go through to India, and no refusal is given to any new business the liquidation of which they are satisfied will be properly performed at the other end. I have not only discussed this matter with the banks. The Committee agree that it is most desirable that the Government should not do business which can be done through ordinary channels. I have discussed the matter with the Manchester Chamber of Commerce who say that as far as they are concerned they have not the least difficulty in dealing with this particular trade.

I was not speaking of Manchester, but of London. I had a conversation with a well-known authority connected with the London banks and I should be glad to place my information at the disposal of the hon. and gallant Gentleman.

I shall be glad to have that information.

Amendment negatived.

Amendment made: In Sub-section (1), after the word "transactions," insert the words "other than the sale of munitions of war."—[ Lieut.-Commander Ken-worthy .]

I beg to move, at the end of Sub-section (1), to insert the words of the hon. and gallant Member in charge of the Bill and to the support and consideration of the Committee. As the Bill stands now, the export transactions for which these guarantees and credits are to he given are apparently only prospective transactions. If this Amendment be accepted the export transactions will comprise the re-sale of goods which have already been manufactured here and exported from here, but which have been left to account in the markets of India. The grievance which this Amendment is intended to redress is a very serious one, because an enormous amount of cotton goods were sent from Lancashire to India during the good times which preceded the present trade depression, and although some importers accepted delivery of these goods there were a large number of Indian importers who left the goods to account. They have not accepted them nor paid for them, not on account of any breach of conditions on the part of the sellers, but because the actual capital value of those goods has depreciated enormously since the orders were originally placed, and in the second place because of the sinister campaign of non-cooperation which is associated with the name of Mr. Gandhi.

At present there is an enormous mass of goods representing capital to the extent of perhaps £20,000,000 lying in India which have been sent there in accordance with orders from India, but where the buyer has repudiated his obligation to accept delivery of the goods. The British exporter is very seriously handicapped because it is useless for him to attempt to sue the Indian importer, because that means a great deal of delay, and these men would not be worth suing in the courts. Nor is it possible to expect any assistance from the Indian Government, because their policy is antagonistic to Lancashire, as evidenced by the imposition of a protective duty of 10 per cent, on imported textile goods, by which the mill-owners of Bombay will become rich beyond the dreams of avarice, no matter what happens to the peasant who is in need of Lancashire goods. Inferior goods at higher prices are forced upon him and the British textile is kept out. That being so this repudiation of the goods by the Indian buyer has led to bad trade and bad times in Lancashire. Mills which are normally engaged in the manufacture of textiles for the Indian markets are working either short time or not at all. In Manchester itself merchant shipping houses, which usually thrive on this particular branch of the export trade, are simply keeping open for the sake of the employees—an honourable illustration of the way in which employers do stand in this country by their employees. This paralysis of trade is the more poignant because there is a great demand and a great need for these goods. There is also an effective demand. The goods can be paid for, and yet they are lying there not accepted by the Indian buyers. If this Amendment be carried, it means that it will become permissive for the Committee which is charged with the administration of this Measure to give trade credits and guarantees to those merchants in Lancashire who wish to re-sell these goods to other buyers in the Indian markets.

9.0 P.M.

That brings me to the question of unemployment with which this Bill is designed to deal. What will bring about further employment in the cotton trade is the release of capital now locked up in these goods, and, secondly, the release of credit which at the present time is taxed to the utmost extent in the case of shippers who used bank credits for the purpose of exporting the goods now lying undisposed of in India. The carrying of the Amendment would mean two things. First, the release of a lot of capital now locked up for reproductive purposes. If it is not locked up it will be available to provide employment Secondly, it would mean that the merchants who are concerned with the shipping of these goods to India would be enabled to get renewed and extended credits from the banks. It may be true that certain members of the Manchester Chamber of Commerce say that all is well at the present time, but others do not take that view, and I think the great majority of merchants in Manchester would be only too glad to welcome anything which helps to get rid of this enormous dead-weight burden of stocks lying to account in the harbours and warehouses of India. At present we can only get rid of that dead weight by cutting the loss and in many cases that would result in absolute insolvency. If this Bill be extended in the way I have indicated, it will give facilities for the resale of these goods, so that the shippers who sent them out will have some assistance from the Government in getting rid of them. Their capital and their credit will receive a new lease of life and will give employment for unemployed labour. Of the trade credits given under the existing scheme—amounting to £3,353,000—only £769,000 has gone to the cotton trade, and we might surely ask for something more than that. I believe if the Amendment were carried it would give a real impetus to the export trade in cotton goods from Lancashire to India, and more employment will be created among a population which is simply starving for work, and at the same time Parliament will be acting in accordance with the dictates of justice and on wise lines.

My hon. and learned friend has argued the Amendment with his accustomed lucidity; indeed he has argued it so well and with such persuasiveness that he almost conceals from the Committee the very grave and serious departure in principle which he is inviting it to make. The principle of this Measure is the financing of new business. What my hon. and learned Friend is asking us to do is, not to finance new business, but to carry a proportion of bills now outstanding and unpaid for business which has already been done. I quite appreciate the difficulties of many of these firms, and, were the credit of the State inexhaustible—my hon. Friend must know that it is anything but inexhaustible; with the best will in the world we have only limited means at our disposal—if funds were available, and if we could afford to give people certain facilities by renewing their bills, we might do so. But we should have to extend it in other directions by carrying over stocks undisposed of, whether they happen to be on the other side of the water or whether they be stocks in the warehouses in respect of which the owner has an overdraft on his bank. The Committee will agree that with these limited funds at our disposal, if we went on that principle the whole fund would disappear in no time, and, therefore, one has to confine the State assistance to giving financial help in order to finance new business.

For that reason I cannot accept this Amendment. I think my hon. and learned Friend will admit that I was far from saying that all was well with the cotton trade, and that members of the Manchester Chamber of Commerce were satisfied. What I said, and what I think he will find to be the fact, is that they do not require this for the purposes of advancing their trade. My hon. and learned Friend himself has said that there is a great and unsatisfied demand for these goods in India. That is so. I believe it to be a demand which cannot be resisted, and I feel certain that the goods will obtain their market. My hon. and learned Friend has said that we have not done much for the cotton trade, and has asked, "Why do you not do someing?" I am. I am doing for the cotton trade exactly what I am doing for every other trade in the country. I am not sure that they will make use of it, because I think that facilities exist through the banks in the ordinary way, but if they do not, I am there ready to finance the new business, if they cannot get it through the banks and if the business is sound. Not only am I ready to do that, as I have been ready in the past, but a new principle is introduced. It is a question of administrative action, and is not in the Bill, but it will be of considerable value to any person dealing in consumable goods. That is that, for short term credits of a year or less than a year, he will not have to submit each transaction to the Advisory Committee for approval. A firm wishing to deal on short term credits in goods of this kind can come to the Committee through his bank and ask for a guarantee up to a fixed sum; and, provided that he takes his 57½ per cent, of the uncovered risk, he is able to make his contracts with the importing firm, and the bills will be automatically accepted for 100 per cent, as they come along. Therefore, I am not only doing for the cotton trade what I have done for every other trade in the past, but I am also providing this administrative action, which is generally agreed to be the most practical way of dealing with the matter.

A firm in my constituency desires assistance in the export of yarn to the Continent, and they tell me that if they can get short credit from the Government they will be able to find employment for men in and around my constituency to the number of 1,000 or 1,500. Is that the kind of business which, if proper security is offered, would rank for consideration?

I have very little to say in extension of what has been said by the hon. Member who moved this Amendment. I presume that the idea of this Bill is to provide employment. Surely in the case of a business that happens to be crippled for want of a little capital, it would be better to give it a little help in that crippled state than to lend money to another firm who are going to bring out perfectly new stuff. A lot of the trade has been hung up on account of these large consignments that have not been taken up. It is all very well to say that certain sections of people say they can get on very well, but the banks must set a limit to the credit they give, and, if the money is expended in material which has been sent out in good faith and in the hope that those particular goods will be taken up, the money is not turned over, and the bank cannot advance more, because they consider that they have made sufficient advances on the credit of the firm. This Amendment only says, "including transactions in respect of goods." We all hope and expect that the Committee which is going to be appointed will be composed of practical business men, and we do not want to dictate to them as to what they shall or shall not do; but we want to give them the option, if they think fit, to use the powers that they have to help on old businesses that are going down. A stitch in time saves nine. In these circumstances we might be able, by a comparatively small amount, to keep an old firm on its legs, instead of bolstering up completely new trade. There are two ways of looking at the matter, and I think that in that way this Bill might be of the greatest possible use. As far as production itself goes, if these large stocks are lying there and the money cannot come in, the mills close, their production is stopped, and unemployment is increased. If you once get rid of your stocks, you get your capital flowing once again, with help from this Bill. You will not only be doing good to our own people, but, by giving an impetus to our trade wherever it may be, will be doing good to the Empire generally. We certainly ought to do this, even if it is not for the production of goods, but with the idea of getting capital once more to flow, so that it will help production and bring employment.

I have always been an advocate in this Chamber of anything that will stimulate the industries of the country, but one of the most extraordinary proposals I have ever heard here is that which is made in this Amendment. I agree that the idea at the root of the proposal was somewhat skilfully concealed, or shall I say that the hon. Member skated very skilfully over thin ice? He tells us that there are something like £20,000,000 worth of goods lying in India unaccepted by the consignees, and his proposal is that under this Bill we shall come in to indemnify the exporters in this country. I hardly think that the Committee can take a proposal of that kind seriously. We are here to stimulate new business, and I suggest that the proposal outlined by my hon. Friend is the direct negation of this stimulation of new business which we all have at heart. I do not suppose that there is one exporting firm of any standing in the country that has not suffered loss by the refusal of consignees in some foreign country to take delivery of goods sent out during the last year. That does not refer to India alone; it refers to South America and to many other countries. I wonder if my hon. Friend realises the scope of this Amendment. I can only say that, if this proposal were to be accepted, it would completely exhaust the whole of the funds at the Government's disposal, and more. I have some knowledge of the exporting houses in London, and I know that several important exporting houses have had to cease operations on account of the refusal of foreign consignees to take delivery. The Manchester school may stand by itself, but I have not heard it suggested by a single responsible firm in London that the Government should come in to indemnify those houses who, in the course of their own business, have exported goods in that manner. They are prepared to stand on their own legs, and they approve of this scheme of the Government, but they are entirely in favour of its being applied only to new business. I hope the Government will not consider for a moment this absurd, and, I venture to say, fantastic Amendment.

I have very great pleasure in supporting this fantastic Amendment, as it has been termed, and I think the Government might give very serious consideration to it further than has been shown by the answer of the Minister. It might be termed a Manchester Amendment. It is often said that the cotton trade is the largest exporting trade in the country, and as such Manchester at any rate may be said to represent a vast amount of the employment which is contained in that export trade. I think it is a mistake for hon. Members to assume that, because the Amendment suggests that there ought to be some financial assistance given even to removing stocks of high-priced goods, that is a fantastic suggestion. We can easily do new business in the cotton trade if we can get rid of the old. The trouble that has been the cause of a great part of the unemployment during the past 12 or 15 months has simply been because of the difficulty in carrying on the ordinary way of business. A great deal of business from Manchester to the East is done on consignment. Therefore it is because the policy of deflation which has been carried on has brought prices to such a low ebb that there has been a difficulty in carrying on. I could give a few comparisons. Goods that were 200 pence two years ago are now at 40. Raw cotton up to 28 pence per pound down again to seven pence. Other cotton as high as 90 pence down again to 15.

No one has ever suggested that hon. Members or the Government should pay the difference. I understand this is a facility to be given to traders, and if you give credit to people, even extended credit, it does not always follow that you pay them anything. Surely the Committee will not argue that any ordinary business man will ask for a special privilege with regard to extending credit on the assumption that he himself is going to be adjudged bankrupt and the Government will lose money on that account. Under the provisions of this Bill there will be a Committee appointed, and it does not follow that every man who comes asking for extended credit will get it, unless he can show that the reasons he gives are good and sound ones, and an application, so far as I can gather, for credit under this scheme will not come direct from any exporter of Manchester goods, or any other goods, for the matter of that, but will be compelled, in the first instance, to go through the exporter's bank; and surely the Committee can rest assured that no bank would willingly help the Government into a position, as some hon. Members seem to think they would do, of helping forward any fantastic schemes of credit. It is just this assistance that is required to get rid of the stocks which are there, because immediately you get rid of your stocks there will be no unemployment. There would be no unemployment if it were not for the stocks. Immediately you move your stocks you get liquid funds and liquid assets, but without that you have not enough money to carry on your business.

I can hardly see that it is a fantastic proposal to say we should try to help manufacturers or merchants—this would apply mostly to merchants—to get ready money to help them to finance their present business and help them to get new business. That is just what we are after. You must get rid of these stocks before you get the new. I will give you an instance in regard to that. At the time of the Armistice we put stuff into stock—and we have it at present in stock—at 40 pence per pound. It was for War purposes, and the bare cost, without any question of profit, was 40 pence per pound. It was for War work, and it was cancelled as soon as the Armistice was signed. Our firm would be willing to sell to any Member of the House who wished to get it at 12 pence per pound. It would be a good thing if we could sell at the price, because it would clear away part of that stock, which is doing nothing, and might give us some liquid assets to help us in our new business.

On a point of Order. Does not this Amendment deal with transactions already entered into, and is the hon. Member's speech relevant?

The hon. Member is a little discursive, but he has not infringed the rules of Order.

I was replying to the last speaker, who said the Amendment was a fantastic one. I was trying to show why it is not, and that it is not altogether such a foolish thing, if you wish to get rid of unemployment, to encourage people to get rid of their stocks. I will give my definition of the best place for stock, and that is either on a railway lorry or a boat.

Or on someone's back in the Far East. Get the goods spread out all over the world. That is what we want. We have had plenty of goods during the last 12 months, but no money. We want more liquid currency. I am sorry the Government will not listen to a reasoned Amendment, which might certainly be called a Manchester Amendment, because I believe everyone who has supported it is a Manchester man. [An HON. MEMBER: "Selfish."] Whether or not we are selfish does not much matter. I do not think that applies. Neither a Manchester nor a London merchant can carry on his business unless he has sufficient money. After all, this would be only permissive. They are not compelled to allow people credit. If they thought there was a fantastic scheme proposed they could very easily turn it down, and they would turn it down at the bank's suggestion. Seeing that it is permissive I would ask the Minister if he will not reconsider his decision.

As a representative of perhaps the largest cotton spinning constituency in England, which has perhaps more spindles than the rest of Europe, I cannot quite let this discussion go through without saying one word. I sympathise very much with all the statements that have, been made in favour of the Amendment, and I should very much like to see the stocks which are now tied up, which freeze up so much capital, got rid of, and that certainly would create an immense amount of fresh employment. Mills which are shut down would be reopened, and others which are working short time would work full time. There is no doubt whatever about that. But under this Bill and the old Overseas Acts which it extends, without this Amendment it is within the competency of the Committee to do it. But after what has been said by the Financial Secretary to the Treasury, I do not want to raise the hopes of Manchester too high. What we in Lancashire would have to do is to go before the Committee and use all the arguments which have been used in support of this Amendment in order to get them to do that which my hon. Friend the Member for Stockport (Mr. Greenwood) has referred to with so much vigour. Knowing my hon. Friend's great business, capacity and the position which he holds in the cotton trade in Lancashire, he has satisfied me that if he goes before this Committee and uses the same arguments he would stand some chance.

Whether this Amendment is put in or not makes no difference, however, because the Committee has the power to do this. Let Lancashire be up and doing, and let the Lancashire Members go in a phalanx to the Committee and lay their case before them.

What Lancashire thinks to-day the rest of England; will think to-morrow. I have been wondering what the "Manchester Guardian" will say of the Debate to-morrow morning. How pleased it will be with Lancashire‡ It is obvious that if the Government really want to do anything for the unemployed, and to improve the trade of the country, the way open is perfectly simple. All they have to do, in the first place, is to guarantee all the bank overdrafts in Lancashire, and, I might add, in the rest of the country. Having, with just a stroke of the pen, done that, all they have to do further is to devote £10,000 to every manufacturer in the country, to begin with, paying in freshly printed Bradburys, and the trick is done.

The Potteries, I am glad to say, are managing on their own. They do not require the spoon-feeding people want in Lancashire. Of course, that is one way out. I suppose the Government have been thinking over this. A lot of traders believe in inflation, and many others believe in deflation. A great many people, both here and outside, believe that inflation is the cause of bad trade, and that the way out is to borrow money, print Bradburys, and increase-prices. I wish the Government joy on that road on which they are pursuing.

Many of us are glad to-assist our friends in Lancashire in deal- ing with this problem. Millions of pounds of cotton goods are stored up in India waiting to be disposed of. No one has given us any real reason why these goods are so held. Is the reason because the prices demanded for the goods are so high that neither they or the persons who might advance the money will face the loss? I would point out that other people have had to face their losses and reduce prices. Why will not the people of Lancashire do their share and get rid of this blight which is affecting not only this, but every other trade? The banks have made so many advances on cotton goods that they are refusing to pay for other goods. I am a sufferer, in consequence, and I have therefore the more sympathy with Lancashire because I want her difficulty solved. The people in Lancashire should bear their share of the losses, and make up their minds that the high prices cannot be realised to-day. They should make an offer to the people who would purchase these goods at to-day's prices, then those goods would quickly disappear, their troubles would be gone, and benefit would be conferred on the traders generally.

Amendment negatived.

I beg to move, at the end of Sub-section (1), to insert the words

"And it is hereby declared that the expression 'goods wholly or partially produced or manufactured in the United Kingdom,' referred to in Section one, Subsection (1) ( a ), of the principal Act, shall be deemed to include herrings caught by British vessels and cured in the United Kingdom."

This Amendment was put down with the intention of making it absolutely clear and certain that the export of cured herrings was covered under the principal Act. If I can have an assurance from the Government that this is so, and that there is no doubt about it, I shall not trouble the Committee with any remarks. I formally move the Amendment.

I can assure my hon. Friend that there is not the least doubt that herrings, caught and cured in the United Kingdom, come within the scope of the principal Act. If he will look at the Act, he will see that what is included is, "goods wholly or partly produced or manufactured in the United Kingdom," and that has been the agreed practice, and will continue to be. There is, of course, a discretion as to what goods this is to apply to, and it is applied to manufactured goods. That includes coal, which has to undergo a great deal of labour, and a herring, which is cured, does undergo a considerable manufacturing process. I shall be very glad to give instructions that this should be included. I am not confining my remarks purely to herrings; they apply to other fish which have undergone a manufacturing process.

Before my hon. Friend withdraws his Amendment I should like to say that I am much obliged to the Parliamentary Secretary to the Overseas Trade Department for what he has said. I had an Amendment down on the Paper to leave out the word "herrings" and insert "fish" That simply referred to the salt fish which is cured, and which is a substantial business. The hon. and gallant Member for Central Aberdeen (Major M. Wood), who knows the trade very well, assures me that in Aberdeen a considerable amount of labour is employed in curing salt fish.

In view of the assurance that we have had from the Government, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

I beg to move, at the end of Sub-section (1), to insert the words the prices of stocks should come down everywhere, that the water should be knocked out of those stocks, and that we should build up again from the foundation. If this Bill is to be used merely to enable these people who have heavy stocks to finance those stocks longer, and to hold them up longer at their present price instead or having to drop the price, it will be harming trade and preventing its recovery in this country.

It was for that reason that I put down this Amendment. I really had not thought it necessary to put it down. I imagined the Government would take steps to see that these credits were only granted for freshly manufactured goods. I have been alarmed, however, at the speech of the hon. Member for Oldham (Mr. Denniss), who said that it was exactly transactions of this sort that were in the Bill and which would be financed by the Parliamentary Secretary to the Overseas Trade Department. He sketched the process of securing these credits for exactly that purpose, with the whole of the Manchester Members visiting the unfortunate Minister for Overseas Trade, and terrorising him into giving credits to merchants who were overstocked. In view of that it is necessary that such an Amendment as this should be put down, in order that we may earmark all the credits that are to be given under this Bill for fresh goods, and not enable people to unload at high prices.

The last Amendment from the Manchester school, which I could not accept, asked for a good deal more than is possible. This Amendment goes a great deal too far in the direction of unreasonable restriction upon the operation of the credits scheme. The test which we lay down is the financing of new business. That business may either be new manufactures or goods sold out of stock. There is no doubt that if you can unfreeze the stocks which are still in existence that will create trade.

It does not depend altogether on what price you unfreeze them, because if you get rid of your stocks there will be new manufacture. Therefore it would be entirely unreasonable to refuse this scheme of finance to sales out of stock. I agree that we do not what to finance sales from stocks at an unreasonable price, and I do not think there is the least fear of it The specific transactions for which credits are asked will come before the Advisory Committee and the Department, and the price will be seen at once. The Committee can, and does, go into the question of price, if there is any appearance of inflated price. Therefore the question of price is tested in the case of specific credit.

You cannot test each particular transaction where you are giving a general credit, because the basis of the scheme is a general authority within which the trader is free to make particular contracts. These credits are only short credits. They are in no case for more than a year. The trader is taking a 57½ per cent. risk. He is selling on short credit in the competitive markets of the world, where people are not too rich, and where people know the price at which they can get the goods elsewhere. A man selling textile goods to-day on short-term credit in the competitive market is not in the least likely to be able to obtain an inflated price for his goods. He will be fortunate if he does not have to sell them at a price much less than that at which they stand.

Amendment negatived.

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

I invite the Parliamentary Secretary to the Overseas Trade Department to explain the extraordinary discrepancy between the policy enunciated by himself or through the voice of his megaphone, the Financial Secretary to the Treasury, and that of the Chancellor of the Exchequer. I refer to the extraordinary pronouncement made that this part of the Bill is not to apply to Russia, despite the specific language which says that it shall apply to any country in the world; whereas Part I of the Bill, which is the financing of foreign Governments and foreign loans and so on, is to apply to Russia if the Committee so decide. I have heard a great deal of the vagaries of the Coalition Government, but here, apparently, is the result of two Unionist Ministers, the Chancellor of the Exchequer and the Minister for Overseas Trade, differing fundamentally on a matter of first-class policy. It would be very interesting to hear an explanation. I imagine it is a case of both of them not being able to go to dinner at the same time, and one being absent from the House when I put the awkward question as to whether the Bill would apply to Russia.

Is the Government wise in saying that this scheme is not, under any circumstances, to apply to Russia? A merchant who wishes to get credit for his trade has to satisfy the Department. If his business is altogether a gamble he will not be able to get the credits. The business has to be fairly good before the merchant can get the credits. According to the Prime Minister, the trade done by Russia during the last nine months was at the rate of £6,000,000 a year. That meant goods exported only direct to Russia and not the trade going to the Baltic ports. [An HON. MEMBER: "It is not correct!"] The Russians say they have done a great deal more trade with this country. I am giving what the Prime Minister said, and he cannot tell a lie. At least, that is the polite Parliamentary fiction. That business was done by Russia without credits of any sort. They had to pay cash for everything. It was done against the obstruction of the bankers, the hostility of the mercantile classes in this country, and the sabotage of the whole business world. People who did business with Russia were confronted with all sorts of difficulties, owing to the poisonous propaganda poured out by hon. Members' associates and the miserable newspapers which they control. Hon. Members may think that I speak with heat in this matter, but it is no wonder when I think of the immense possibilities of Russia, in which, as the hon. Member for East Nottingham (Sir J. D. Rees) says, we could lose the whole of this country. When I think of the great resources of Russia, and that we are losing a chance which the Germans are going to get, and which the Americans have probably got, I cannot help feeling very strongly. Talk about cutting off your nose to spite your face! We have cut off not only our nose but our lips and our face in this matter, simply for the sake of trying to injure M. Lenin, which we have not succeeded in doing. With the exception of the Prime Minister of this country, M. Lenin has been in power longer than any dictator in Europe.

I suppose the Parliamentary Secretary to the Overseas Trade Department will talk his usual extraordinary sentiments about debts. Has he had the privilege and honour of talking with that great Norwegian, Dr. Nansen? I wonder if he talked to him about Russia. I ask that because Nansen probably knows more about Russia than any other person in the world, not even excluding Russians. His explorations in Siberia are well known to all. It is interesting to hear him talk of those rivers, the Yenesi, and the Obi stretching from the Arctic Sea right into Mongolia, bounded on both sides by the most fertile country, with mineral, forest, wheat-growing, and cattle-raising resources beyond any other country in the world. He has declared that the resources of Siberia alone, which have not been tapped yet, are greater than the combined resources of Canada and the United States. Yet that country has only one miserable line of railway running to Vladivostok and built for strategical purposes. It has never been developed. There are practically no roads, and in winter the people have to move about on sledges.

The resources of that country are' illimitable. It is not a manufacturing country; it is a country which produces wealth in the form of raw materials and food. Therefore it is the country par excellence to take manufactured goods, the country to which we as a great manufacturing and exporting nation can look. Yet the Parliamentary Secretary to the Overseas Trade Department says that British merchants must not trade in this great potential market; they must not come to him. He is not going to touch these murderers. I suppose that he will bring up the hideous atrocity stories with which we have been regaled ever since November, 1917. He will talk about debts, about the £500,000,000 which the Czar and his advisers raised against the will of the Duma and the chosen representatives of the Russian people. The hon. Gentleman may recall the speech of the hon. Baronet the Member for Erdington (Sir W. Steel-Maitland) made last week in which he advocated, with the respectful acquiescence of most of the hon. Members of this House, the postponement, if not the cancellation, of the German indemnities. This view is supported by many others. What is the use then of talking about this miserable Czarist debt contracted long before the present regime came into power in Russia?

If this reason is going to be trotted out as an excuse for not including Russia in the Bill, may I point out that the Russian Government have never completely repudiated the debt. They have declared again and again that they are prepared to discuss it in connection with the whole question of peace, but if they will recognise the debt is it agreed that the Poles and others of the secessionist States of Russia should bear their share? This is one of the legitimate questions which should and can be raised before the debt is blindly acknowledged. The Committee on previous occasions has permitted the Government to defend the refusal of credits for the relief of starvation in Russia because of this miserable Czarist debt, but I am pleading for credits for British merchants who are prepared to export goods for the relief of starvation in this country.

As I understand, there is nothing in this Bill to prevent export credits being used in connection with Russia. Therefore I do not follow that the hon. and gallant Gentleman is in order.

I am much obliged, but this question was referred to last week by the Financial Secretary to the Treasury, who said that Russia would not be included. I had no opportunity of raising the matter, and I take the opportunity now of asking an explanation from the Government, and I am attempting to answer the arguments which might be used against my contention.

It would be better to wait to hear the arguments. On the face of this Clause, transactions with Russia are allowed. If the hon. Member has any doubt about it, he can ask the question. I do not think that he can argue on the supposition that such transactions are not allowed. On the face of the Clause obviously they may be allowed.

I did not propose to speak again and therefore I was putting all my cards on the Table now, but the hon. Gentleman has said that he will not include Russia. If Russia is to be included I am satisfied and will sit down at once. But I feel most sincerely that the only real hope to-day for the economic recovery of Europe is to get Russia and Siberia working. Quite apart from politics or whether you like their form of government or not, if British merchants can do business with them in the interests of our own people in this country I think that those credits should be given. If a slip was made the other night, if the hon. and gallant Gentleman will say that there was a misunderstanding, I am sure that none of us on this side will make any use of it. If after reflection the hon. and gallant Gentleman is able to say that if British merchants are prepared to do business with these places he is prepared to assist them, we shall be satisfied. We do not want to make any party capital out of this; we do not want to exploit the sufferings of the unemployed; and it is in that sense I appeal to the hon. and gallant Gentleman to reconsider the matter, and to remove the unfortunate impression created by his remarks on the Second Reading.

As you have stated, Sir, the position is plain and clear. Under the original export credits scheme, which applied to the countries whose financial position had suffered owing to circumstances arising out of the War, it would have been competent for the Government to extend the system of export credits to Russia. The Government have not done so. They have stated repeatedly the terms on which they would consider the question of export credits to Russia. I do not propose, and I doubt whether I should be in order in doing so, to discuss that question now. I only say that the policy of the Government remains entirely unchanged, and there is nothing in the provisions of this Bill which in any way adds to or detracts from the powers of the Government in relation to the other scheme, and there is no proposal to alter the policy of the Government.

Does that mean that we are not going to extend the credits to Russia? Cannot it be stated plainly?

Question, "That the Clause, as amended, stand part of the Bill," put, and agreed to.

Clause 3 ( Short Title and Repeal ) ordered to stand part of the Bill.

Schedule ( Enactments Repealed ) ordered to stand part of the Bill.

Bill reported; as amended to be considered To-morrow; and to be printed. [Bill 227.]

Poor Law Emergency Provisions (Scotland) Bill

Order for Second Reading read.

On behalf of the Secretary for Scotland, I beg to move, "That the Bill be now read a Second time."

This Measure is simple in character although it is couched in legal language. It is founded upon the existing law; it is extremely narrow and limited in its scope, and I trust will be non-controversial. It is one of the series of Bills presented by the Government in order to palliate distress due to unemployment. It is confined in its operation to Scotland. There is a notable difference between the law of Scotland and the law of England in regard to Poor Law relief. I do not propose to discuss the merits of the respective systems. In Scotland from the earliest days it has been a fundamental principle of our law that relief should not be afforded to those who are merely poor and out of employment, if they fulfil the condition of being able-bodied, that is, suffer from no disability, physical or mental. When the law was remodelled by Statute in 1845, the then Poor Law Commission recommended that relief should not be extended to the able-bodied. It is quite true that, in certain matters, what some regard as a rather stringent rule, has been tempered in two respects; first, by judicial construction, in the case more particularly of women and young persons, and, perhaps, to some extent by practice. But the outstanding fact to-day is that although the matter was raised in Parliament as long ago as 1866, the law of Scotland to-day does not permit, save in exceptional cases, the extension of Poor Law relief to the able-bodied.

10.0 P.M.

In England the position is entirely different. The common law or Statute law of England does permit, in necessitous cases, the granting of relief to people who are destitute and out of employment, although in the Scottish sense they may be able-bodied. To-day both England and Scotland are suffering under a common calamity, and the Government desire that in Scotland parish councils which are willing to afford assistance in these abnormal times should not be cramped or hindered by the law as it stands. Accordingly, the principle and the object of the Bill are simple. First, we propose to alter the existing law by conferring additional power upon parish councils to relieve the poor and destitute, although they may be able-bodied. It is proposed to remove certain restrictions so as to enable the councils to administer relief. The Bill does not propose a permanent change in the law—that will be for after-consideration—but is limited in its operation to a certain time. Those three points are embodied in the Title of the Bill. The Bill is simple in its operation, extremely narrow in its scope, and to-night I have been informed that it is heartily welcomed by the parish councils of Scotland.

I will add a word or two of explanation with regard to the purport of the Clauses. Clause 1 provides that, notwithstanding anything in Section 68 of the Poor Law (Scotland) Act, 1845, relief may be granted to destitute able-bodied persons who are out of employment. Section 68 of the existing Poor Law Act expressly provides that relief shall not be granted to the able-bodied, and we propose, with the approval of the House, to amend the law temporarily in that respect. It will be noticed that two conditions are required. The applicant for relief must satisfy the authorities that he is destitute and that he is unable to obtain employment. Subject to these, it is proposed for the first time to give the local authorities legal power to extend these benefits. Sub-section (2) of Clause 1 provides the machinery. It comes to this, that we propose to conserve the existing law of relief in regard to the added charge. As things stand to-day, one parish has in certain circumstances a right against another parish in regard to charges or expenses, and we propose to conserve that, but free from the necessity now existing that relief shall not be claimed prior to the date of the notice given. Under present conditions, it would be perfectly impossible to do otherwise unless you increased the number of officials; to work out a new system you would require an army. That is the first enabling Clause.

The second Clause is the other operating and enabling Clause. We now that certain, though not all, of the parishes in Scotland, notably, those which are small with heavy industrial populations and relatively small assessable value, are somewhat pressed under the present conditions. There are today under, the law certain restrictions upon the finances of a parish council the removal of which, it is hoped, may aid in relieving the situation. Accordingly, under Clause 2 it is proposed to remove one or two of these restrictions. There is a reference back again to a Section of the principal Act, and the substance of it comes to this: As things stand to-day we know these local authorities work, until they have recovered their rates, largely on overdraft, and a local authority may now borrow, but only up to 50 per cent, of the outstanding rates for the year which is in charge. There is another restriction, and that is that, having incurred liability in respect of such borrowings, they are unable to make any further financial borrowings until the next statutory period. It is thought in certain cases, where the pressure is high in Scotland, it might do if this restriction were removed. That is the purpose of Clause 2. The limit of 50 per cent, of the outstanding rate is removed—the amount to be borrowed is not limited in amount, but this, of course, subject to the approval of the supervising authority. In the second place, in order to facilitate finances, for the first time it is proposed that the parish council shall be in a position to offer as security not only the rates of the year in charge but those of the present and future. These two limits then would not be in, but there has been imposed, what I trust the House will also think wise, a limit upon the period of repayment, and accordingly it is proposed that that should be within five years of the date of the borrowing. Those are the two main and really operative Clauses of the Bill.

In the event of re payment not being made in five years, what would happen?

On what principle will the supervising authority, the Board of Health, be guided in supervising the increased rates?

I think plainly on the footing that at least some regard will have to be paid to the financial stability of the particular parish council, and to see that they did not outrun the constable too far, they would have to take into account what would be the resources available. Just one word with regard to Sub-section (2). We are asking, that where before the passing of the Bill a council has borrowed in excess of the existing limits, the House should validate that. That would follow if the House accepts the principle of the Bill, but I only want to explain why that should become necessary. Although the strict law is as I have said, it is the case that in certain necessitous cases parish councils have found cases of such need that although a man was able-bodied and out of employment there was a probability that disability would ensue unless some relief was given, and in the exercise of their discretion and in the name of humanity that relief was given. That is the reason why we are asking that to a certain extent the operation of the Bill should be made retrospective, so as to cover cases in which there may have been a technical, not breach, but step in advance, of the law as it stands. I am told the cases are few, but there have been exceptional cases since the coal dispute, which accounts for the date in Sub-section (3) of Clause 1, namely, April, 1921.

Sub-section (4) of Clause 2 is only a proviso, with regard to the temporary loans to be provided under the Statute, that they are not to count with the permanent loans which are incurred or liable to be incurred, which are limited to one-fifth of the annual assessable value. The first three Sub-sections of Clause 3 are formal, but Sub-section (4) provides the limit in point of time with which I have dealt, and it is provided that the Act is to apply to Scotland only, for the reason which I have stated to the House, and is to have effect for a limited period, until the 15th May, 1922, or such later date not being more than one year thereafter as the Board may fix. There are two small provisos which are relatively unimportant, but the terms of which require some explanation. The first is the proviso that

The Solicitor-General for Scotland has moved this Bill in a speech of such clarity that even the English Members could scarce forbear to cheer, and, as far as I am concerned, I have no criticism to make, but no doubt one or two queries will be raised. The greatest compliment, I suppose, that I can pay to my hon. and learned Friend is this, that unless there are some very special Amendments which are sought to be put down, I would raise no objection to the Committee stage being taken to-night, as it is at a reasonable hour, and there is quite a good attendance of Scottish Members. I was very pleased to notice that the operation of this Bill is sought to be limited to 1922, and I hope, so purely a Scottish matter is this, that it will then be dealt with by a Scottish Parliament in Scotland.

I agree with my right hon. Friend in regard to the lucidity with which my hon. and learned Friend introduced the Bill, and the clear statement which he made. A Bill of this kind is essential, for we must get rid of the difficulty in regard to the parish councils, but I am surprised that my right hon. Friend opposite does not notice there are one or two important points which require dealing with. The Bill must be passed in such a way that banks will find no difficulty in lending the money required, but no bank would lend a shilling under the Bill as it stands. In the first place, it is not a banking loan, a five years' loan. The Bill mortgages the rates for the repayment of the loan, but it in no way states that if the loans are not repaid in five years there is any continuing liability on the rates after the five years have elapsed. There is no statement of that kind in the Bill at all, and, without an obligation of that kind, it would be perfectly impossible to expect any banker to lend a shilling on any such security.

The other point which occurs to me, which was mentioned for a moment by the Solicitor-General, is that there are certain parishes in Scotland of comparatively small rental value which contain a very large number of inhabitants. It is just in these parishes where the greatest amount of unemployment is likely to exist, and it would be probably impossible for them to meet the demand upon them of any such levy as would be made. I do not know that the Bill as it stands is quite satisfactory in respect to the question of area for that particular reason. I know many parishes in which it would have practically no effect if there were a serious amount of unemployment, and I do not know where the money, and how the money, is to be raised. Although we have painful experience of the extension of areas with regard to education in Scotland, and I do not want to see that repeated in this Measure, still I have to point out to the House the difficulties that occur to me, and which I do not think can be overlooked. The Solicitor-General gave me no answer with regard to the interruption I made with regard to the five years' period of repayment, and I doubt whether he has any particular answer to give. I am sure he will agree with me that, first of all, it is desirable to consider the question of area, and, secondly, it is essential, if at all possible, that we should pass this Bill in such a way that the banks will not have a reasonable excuse for refusing to advance the money.

I am sure all the parish councils in Scotland, as the Solicitor-General has said, will welcome this Bill, but I would like to follow on what has been said by the hon. Baronet opposite with regard to industrial centres in Scotland. If I may use as an instance a parish council in my own constituency, a big parish of some 62,000 inhabitants, at the present moment in that parish we pay out as much as £2,700 a week in relief to the able-bodied unemployed, and, at a rough calculation, this sum spread over the whole year, will double the present poor rate. As it has been pointed out by the hon. Baronet, it will be very difficult to recover these rates. I have been very carefully into these figures with the chairman of this parish council—and I am sure there are many other parish councils in the same position—but I find in this parish there are many small property owners who are getting no rents for their properties, owing to the present unemployment, and they themselves are also out of work. It is obvious that it would be impossible for these people to pay any rates at all, and this parish council—and I am sure many others—are looking at the present situation with the greatest alarm. I have a letter here from the clerk to this parish council. He says that the question of the revenue is becoming serious. There had been paid out that week £2,700, and they would soon have passed the £3,000 limit. It occurs to me that parishes like that in Scotland are in much the same position as some of the poorer boroughs in London, with this great, difference, that there is no sort of equalisation of rates in Scotland between the parishes. So we come to this: that we have the industrial parishes like the one I have quoted, where the burden is becoming more than they can bear, while, on the other hand, places like some of the seaside resorts and residential places are not feeling the burden at all. I respectfully put it to the Solicitor-General for Scotland whether some means should not be found under which they might have Government grants to help them or some of the money expended at least be paid back, and if that is impossible, I would suggest to my hon. and learned Friend, as the right hon. Gentleman has suggested, that we might have these rates spread over a somewhat larger area so as to relieve these parish councils who are really trying now to carry a burden that in all human probability, if it goes on for the next four or five months, they will find they are not really able to bear.

There is such general agreement regarding the purpose of this Bill in Scotland that it is quite unnecessary to detain the House at any length. There are, however, one or two points which, with great respect, I wish to put to the Solicitor-General in order that in his reply he may clear them up. In the first place, I think most of the Scottish Members will agree that while the principles of our Poor Law in Scotland have been perfectly clear in refusing relief to the able-bodied, we are all more or less familiar with regulations, or at all events with memoranda, which have been issued under which it is possible to grant assistance to an able-bodied person in a time of national emergency or stress.

I confess I was rather surprised to find when this Bill was introduced that a Parliamentary measure was necessary—for apparently one is required—and we have just to consider the fears which have been expressed by many people interested in Poor Law administration in Scotland that there is a very great danger, even in a time of national emergency, in opening the doors of the Scottish Poor Law to the able-bodied. I think we may assume, apart from one or two of the industrial districts in Scotland in which the conditions are at the moment bad, that the numbers that will actually make application will probably be comparatively small, or at all events the numbers assisted will be small, because, as the Solicitor-General has pointed out, in the first Clause of this Measure it is definitely laid down that the applicant must satisfy the parish council that he is out of employment and destitute. If these two conditions are kept clearly in mind I think it is safe to assume that the assistance which is going to be given by the parish councils in Scotland under this Bill to the able-bodied, in acute need, will really be the last line of defence, after trade union benefit has been considered or the unemployed donation, in so far as that exists, or may be revived in future. There will also be the provision which is now being made on voluntary lines in many large Scottish centres. Thirdly, there will be the general state of the family circumstances and so on which, of course, is always taken carefully into account. It seems to me that in many parts of the country it will be difficult to prove the kind of destitution which the average Scottish parish council usually has in mind. If that is so, I think, apart from certain districts in Scotland, we need not be unduly anxious as to any possible demoralising effect of this Bill. On the question of the difficult districts which have been very badly affected by unemployment, I entirely agree with what has been said by my hon. and gallant Friend (Lieut.-Colonel Buchanan). The second Clause refers to the question of settlement and recovery against a parish. Very few of us are authorities on the Scottish law of settlement, but I have an idea that settlement is acquired by residence and so on, and I certainly know that there are some large centres in Scotland into which a comparatively large number of people have poured within recent years, have acquired a settlement, and may become recipients under this Bill. I cannot help feeling, however, that there is some injustice in imposing so large a burden on the districts which are placed in that position. Is there not some method by which we can relieve that burden which will be substantial for the ratepayers in those localities and try to get a better contribution from those other parts of Scotland from which it is reasonable to expect a larger contribution under this Lead.

The only other point is one which was raised by the hon. Baronet the Member for Ayr Burghs (Sir G. Younger) who referred to Clause 2 of the Bill and the extra power which is given to borrow money on the security of the rates present and future, and for the five years' period of repayment. I confess that I sympathise with the points he has put, and I am not sure that up to this stage the matter has been cleared up. The Solicitor-General indicates compulsory repayment within five years, but if a set of circumstances arise in which the burden is so heavy on any particular locality that they are unable to fulfil that condition, what is to be the security to the lender, whether it is a bank, a private individual, or anyone else? I should imagine that the whole intention was a continuing liability, but I feel strongly that Clause 2 does not make that point perfectly clear.

The remaining and minor point is on the question of five years' repayment. I agree entirely that the repayment should be made at the earliest possible moment, and we all recognise that this is a Bill dealing with an emergency. Considering the hardships, rating and otherwise of these districts, I should like to ask if we are satisfied that five years is long enough. I am sure that there are one or two districts in which it would be much easier if a longer term were conceded, and I should like to hear the Solicitor-General on that point when he comes to reply to the Debate.

The Government are to be congratulated on coming to the assistance in this matter of the parish councils of Scotland. Having said that, I wish to state that in my view there ought to be larger powers in some parishes to deal with the state of things which has arisen. I have in mind in one district an industry which has wellnigh completely collapsed. I have in view in that particular county one particular trade where the mines and works which afforded the only employment in that district have stopped. The result of the works having stopped is that the valuation of the works and machinery has been very materially reduced—almost indeed down to scrap value. I ask this House to consider the position of this parish under this Bill. The population consists almost exclusively of industrial workers, many of whom as an evidence of their character own their houses. The houses so far as they belong to the occupiers belong to small people. Then there are the men in shops whose businesses are for the time being ruined, yet these men who are out of employment, these shopkeepers whose businesses are destroyed are to bear this increased burden. One can realise the feeling of disappointment with which they will receive this Bill.

The hon. Member for Central Edinburgh (Mr. W. Graham) drew attention to the fact that in many parishes in recent years aliens have poured in in considerable numbers, and he appealed to the Law of Settlement to discover whether the liability of those districts into which the aliens have come could not be spread over a wider area—even to the part from which they came. I hope the learned Solicitor-General would be able to meet the hon. Member in that respect. In the district to which I have referred many of the immigrants have come from Ireland. The Solicitor-General in his excellent speech gave English Members an insight into the history of the Scottish Poor Law which should enable them to realise at once that the Scottish Poor Law pre supposes the independence of the adult man who is not suffering from any disability. Representing, as this Bill does, the utmost that this or any other Government can do for the parish councils or for the workers in districts such as I have referred to, the House is bound to realise that the worker must seek relief from some other source than Parliament. If our industries were set going to-morrow, with freedom as to wages, we might still require assistance, but not much. In the iron industry in my own county work is restricted to 5, 4, or 3 days a week for the simple reason that the employers cannot afford the regulation wage. I have cases where workers—

I accept your ruling, Mr. Speaker, but, while I acknowledge the efforts of the Government to give what assistance they can to the parish councils, yet, situated as I am, representing a county which is in a state of industrial collapse at the present time, and realising how really unhelpful, notwithstanding the excellent intentions of the Government, this Measure is to that county, I did hope that I might have ventured to remark upon another way in which the worker could have been assisted, and that, instead of relying upon the national crust of which the Prime Minister has spoken, we might have discovered in our own industries if they were left to themselves a wholesome half loaf.

I should like to ask the Solicitor-General to enlighten us about Clause 2, in reference to the question of the repayment of any money borrowed by the parish councils within the somewhat restricted period of five years. I think I am right in saying that my hon. and learned Friend said that these councils would be allowed to move ahead in the matter of borrowing, subject always to the control of the Board of Health. Personally, I feel that they ought to be given more latitude, and, if the Parliamentary Secretary for Health for Scotland will allow me to say so, I think that really the parish councils are well able to exercise their discretion in these matters without having constant control exercised by bureaucrats in Edinburgh. I sincerely hope that my hon. and learned Friend will consider this point. The hon. Baronet the Member for Ayr Burghs (Sir G. Younger) made some observations upon it which were very pertinent. Circumstances vary very much, and the Board in Edinburgh does not know the local conditions. One parish council may be able to borrow money advantageously, surely and safely, and another may not. All those details in the transaction are not really known to the Board of Health, and I do think that the parish councils should be invested with rather wider and more important powers than under this Bill they are going to have.

The only other point that I wish to mention is that the duration of the Bill is only to be till 15th May, 1922, and, if I followed my hon. and learned Friend correctly, it remains within the power of the Board of Health to determine that it shall function for one year thereafter. Here again, with all respect, I quarrel with the limited scope of the Measure. I do not see why this House of Commons should not determine the duration of the Act, and I personally object very strongly to its coming to an end on 15th May, 1922. None of us—not even the most learned, amongst whom I do not count myself—can gauge the period during which the present emergency will continue, but supposing that, as we all hope, it comes to an end at no distant date, we leave, if my hon. and learned Friend will agree to the proposal I make—which is that the Bill should continue until 15th May, 1923—power in the hands of the parish council to carry on their work until that date. Those of us who are Scotsmen know very well that we have no Poplar parish councils in Scotland. They are not spendthrift bodies, and can be trusted to administer the powers that they have in a characteristically Scottish way—in other words, with a due regard to economy—and I press my hon. and learned Friend to accept the one point to which I attach importance, namely, that the Bill should not terminate on 15th May, 1922, but that the parish councils should be vested with the right to carry on until 15th May, 1923.

The provisions of the Bill are likely to press very hardly on purely rural parish councils. I refer especially to the parishes of Dornock and Gretna, where the Government established a factory. Almost all the old workers in that factory, now resident in the district, have spent their savings and are on the point of destitution. I will take the figures of the parish of Dornock to illustrate exactly how the matter stands. The population is 1,780, of whom 1,032 persons were dependent on the factory for work. They are either householders or dependants of householders, and they are on the edge of starvation. As the Bill stands, the 750 remaining persons in Dornock, or rather the householders amongst them, will have to support the whole of the 1,032, who were previously employed at the factory. I am sure my hon. and learned Friend does not wish for any result of that kind, and I hope some of the measures which have been suggested in the way of spreading the burden may finally meet with his concurrence.

I think the hon. Member for 'Montrose (Mr. Sturrock) has taken too high a view of the way the parish councils carry out their work in Scotland. I do not yield to him in admiration of the manner in which they carry out such work as has been in their hands in the past, but in this particular instance we have two things to remember; first of all, that Scotland has very scattered areas with very small populations, and that when the rates are spread over those areas the demands that will be made upon them by this Bill will be found to be very difficult to meet. Another side of this question is that tremendous pressure will be brought to bear upon the different parish councils in their scattered areas in such cases as have just been described by my hon. and gallant Friend the Member for Dumfries (Major W. Murray), and I agree that the parish councils should have a superior authority over them to act as a buffer between them and the demands which will be made upon them under this Bill. That is the main reason why I have risen to speak on this Bill. I hope that the Government will stand firm in this respect, and will insist that the Board of Health in Scotland shall have full supervisory authority over the raising of rates under this Bill with the extended powers that are granted to them.

I should like to ask the Solicitor-General for Scotland a couple of questions about this Bill. I understand that this is an extension of the power of the local authorities in Scotland with regard to granting relief to people who are destitute, and that, under the present law, no able-bodied man in Scotland is entitled to relief. Now it is intended to take power to give the local authority the power to grant such relief in all cases where a man proves that he is out of employment and destitute, and that there is no limitation on the power of the local authority to differentiate between married and single men, and that any man who proves that he is out of work and destitute is entitled to relief. If that is so, it is a very important extension of powers, and has gone a considerable step in advance of the practice in this country. Here, while outdoor relief can be granted to married people, it is not possible to grant the single men outdoor relief. They must enter the workhouse if they are single and able-bodied. I take it that that is not so in Scotland, that there is no obligation on the applicant for Poor Law relief to go into the workhouse, and that, whether married or single, he can be granted outdoor relief. If that is so, and if this is a fresh power that the Government are taking for Scotland, I beg the representatives of Scotland on the Government Bench to make representations to their English colleagues to put England on the same humane terms as they are now proposing for Scotland.

There will be a general opinion in Scotland that a Measure of this sort is required in the interests of the present serious state of affairs. When we think how this Bill will deal with some of our industrial districts, however, we find, as some speakers have already said, in the mining districts, where there are a great number of unemployed men, that the rates will be so heavy as to place an absolutely impossible burden on those parishes. It is necessary that these parish councils should be able to get assistance, but the provisions of this Bill will prevent them getting the money from the banks as before. There must be some means by which a national guarantee can be provided to enable the banks to lend the money. When we see the burden on the impoverished ratepayers in these industrial districts, we must recognise that these people are not able to bear the addition that will be put on them, and unless we can get some money from a national source I do not see how this Bill can enable relief to be given to people who require it. We all know of parishes in our constituencies where, if you were to put an increased burden on the languishing trade that still remains, it would be absolutely killed. Unless relief can come from national sources I do not know what we are going to do.

The Bill is

Is the intention of the Government to define what they mean by "destitute persons" and the methods to be adopted to find out the existence of destitute people? In the past and at the present time, when people have found it necessary to make application for assistance, either to the parish councils or some other body, inspectors have been sent down to put questions. If such questions were addressed to the visitors themselves they would regard them as impertinent, but the visitors seem to imagine that it is right and proper to put such questions to the people whom they visit. Scottish Members understand the feelings of the Scottish people and of those individuals who, finding themselves up against hard times, have to make application for relief. They make application with the greatest reluctance. The husband and wife have added, bit by bit, to the furnishing of their dwelling until they have got what to them is a comfortable home. When the visitors go to the house they look round the place. It may be at some period of temporary affluence the parents have allowed one of their children to have music lessons, and have purchased a piano. The visitor tells them that they are not to be considered destitute because the household is too well furnished, and until some of the furniture has been got rid of and the house has been stripped of some of the comforts which have been built up by the family they will not be considered entitled to relief under the term "destitute." In the present period of abnormal industrial distress, will there be visits from inspectors who will conduct their investigations along the old lines? It is not right and proper that relief should be given to the unemployed who can satisfy the inspector that their unemployment is not due to any evil purpose or evil habits on their part; and that, in addition, those inspectors will receive strict instructions from the Board of Health in Scotland that those inquisitorial methods shall not be adopted on this occasion, and that while it is right that satisfactory inquiries shall be made, there shall be no requirement that the house should be stripped almost of these little amenities which the family have taken 10, 15 or 20 years to get together, before they can be considered eligible for relief under this Bill. I hope that the right hon. Gentleman will make a definite statement as regards the interpretation of the term "destitute." Otherwise we shall have no end to the methods adopted which in periods of distress involve humiliation to the applicants and cause them to consider that the relief is no use to them when they have to submit to all these inquisitorial methods.

I agree with the hon. Member for Govan (Mr. N. Maclean) in regard to the inquisitorial methods adopted in inquiries. I know how bitterly they were resented, especially in the case of disabled men. But if the Solicitor-General will assure the House that the same method will be adopted in regard to allowances for disabled men as has been adopted by parish councils during the last three months, it will give satisfaction. Thousands of people in my district have received out-of-work donation from the parish council, not because it was legal to do it, but because the parish council took it upon themselves to give it, and this Bill makes that legal retrospectively to the month of April last. The Member for Central Edinburgh (Mr. W. Graham) I am afraid was not so well informed as he usually is in regard to what is taking place in Scotland. I do not know how it is in the east of Scotland, but in the west of Scotland, in Dumbartonshire, in Clydebank, Dumbarton and the Vale of Leven, unemployment has been so long and so rife that people who had never thought of asking assistance have had to ask for assistance from the parish councils. That has placed a very large burden upon the parish councils, and in one parish in Dumbartonshire notice has been given to the parish council that the bank can no longer finance them in giving this allowance. This Bill may give the bank the security which they naturally desire, so as to continue to finance the parish council, but I join issue with my hon. and gallant Friend the Member for Coatbridge (Lieut.-Colonel Buchanan) in reference to the application to counties in Scotland of the principle adopted in the case of the London boroughs to help the poorer districts. I have had representations from Dumbartonshire pointing out the number of persons in the different areas who have to receive an allowance from the parish councils, so that the wealth of the one parish, where they have nothing to give in the way of relief, may be available to lighten the burden in the large industrial centres. I ask the Solicitor-General whether it is not possible to pass some Measure giving the same power over the county as has been given to the London boroughs.

I also join in asking for an extension of the time for repayment of the loan. Anyone who has had anything to do with public work in Scotland knows how difficult it is to get money at any time; and it is more difficult now than it ever was. If loans are limited to five years, with a burden the size of which no one can forsee, I hold that the time is too short and should be extended. I have been told by some of my constituents that if they receive this relief from the parish council, they will be disfranchised. I am glad my right hon. Friend denies that that is so. I thought it was not the case, but it is well that these fears should be set at rest. On the whole I welcome this Bill for its provision that Scotland shall be put on the same footing as England, so that able-bodied men can get assistance.

I welcome this Bill on behalf of a parish of which I know something. There has been great difficulty in raising money for the mining population there. That has been due to many causes. There are large numbers of men in the district around Airdrie who have been denied unemployment benefit because of certain things done by some men at the collieries, and these men are able-bodied men, but utterly unable to get any work in the district. The drain upon the parish council has been so great that some of the people from whom money used to be obtained have refused to advance any more, and the council is now in a dilemma. With the passage of this Bill money will be available, and these respectable men will receive sufficient at least to keep body and soul together. It is true that the sums given by the parish councils will not provide for many of these people the living to which they are accustomed, but after all half a loaf is better than nothing at all, and these men will be very grateful for it. It is true that next year the rates will be very heavily charged. I join heartily with those who ask that the time for loan repayments should be extended. If the period is extended from five to ten or fifteen years it will allow those who came after to pay their share towards the cost of the hard times through which we are now passing. I trust when the Bill comes to the Committee stage, this time will be extended, so that parishes having a large number of able-bodied unemployed, may have some opportunity of arranging their rates in such a way that the people will not be overburdened. I heartily welcome the Bill and I am glad something is going to be done for a very deserving body of men who are out of employment, through no fault of their own.

I desire to associate myself with the appeal made to the Solicitor-General, that before the Bill becomes an Act, he should get to know what is exactly meant by "destitute person." We know how, men who are unable to get work through no fault of their own, are being treated at the present time, and we know it is not the bureaucrats in Edinburgh who are giving them that treatment, but the bureaucrats in their own parishes at home. I am inclined to favour the line taken by the hon. Member who has suggested that the Scottish Board of Health should have some control over the local authorities. I hope the Solicitor-General will make it clear that we shall have a right of appeal to the Scottish Board of Health. I have on various occasions acted on deputations to the Scottish Board of Health regarding this very question, because at the present time parish councils are giving relief, not willingly, but on account of the fact that they have no choice. The conditions are such that they have either got to give relief or the people will starve. It is well we should make clear the fact that the people of Scotland are not going to starve willingly. There will be trouble unless this Bill becomes an Act, out of which some real good will come.

With regard to the question of settlement, reference has been made to migrants who have gone to various counties and the statement has been made that most of them are Irish. I quite frankly admit there are some who are English and Irish and Highlanders, as well as Scottish. Are these men or their dependants to be refused relief unless the parish in which they happen to be living has some agreement whereby the parish in which they were born makes good the amount paid? Take for instance a man who is born in Aberdeenshire. We have a lot of people from Aberdeen living in Lanarkshire—that is why we are so economical. Supposing a man born in an agricultural parish of Aberdeen puts in a claim for relief will his claim depend on the willingness of his native parish to make good the sum paid or will he be—as used to be the custom in Scotland—transported to his native parish. I hope that is not the intention, and I ask the Solicitor-General to arrange that a man may get relief in the parish in which he lives.

Another matter I would like to bring before the hon. and learned Gentleman is that the House should be informed as to the areas. We have in Lanarkshire three wards. We have a number of men who have been idle for a considerable number of months, with little prospect of getting work for some months to come. If a ward be formed by the county as a whole they would be able to get quite as much in these agricultural parishes in Lanarkshire as they would be entitled to get in the richer parishes in the middle and lower wards, but they would not get so much if the ward were confined to the agricultural area only. I should like to know if it is the intention of the Government in the first place that everybody who is unable to find work, and who satisfies the parish council or a committee of the parish council, he should get relief. We find in our experience that a considerable number of the inspectors are not blessed with very much humanity, and I should like to know whether the parish council is going to have the power, and, if not, will the Government be prepared to give them the power, to say whether a man is to be refused relief or not.

I should also like to be certain that it is not the intention of the Government that parish councils or inspectors shall interfere by way of questions as to what particular church a man happens to go to. That has been done quite recently in parishes in the county to which my hon. Friend the Member for Linlithgow (Mr. Kidd) belongs. The religion was particularly inquired into, and I hope that that is not the intention of the Government, and that they will take some steps to prevent inquisitorial proceedings of that kind. Also I should like to know what is meant by the settlement question, whether it really means any change in the present system, and whether there is any intention on the part of the Government that the parish to which a man belongs is to be held responsible for what a man gets in the way of relief.

I have to thank hon. Members on both sides of the House for the sympathetic reception of the Bill as it stands. There have been important matters mentioned, some of which have not been without consideration by the Government, but a number of the more important are plainly outside the plan and content of the present Bill. Others again are not Second Reading but Committee points. A number of questions have been put to me as to whether in my opinion it would not be possible under the scheme of this Measure to take steps whereby what is an unquestioned difficulty in Scotland, and recognised as such, that is, the limitation of the areas, could be obviated. I am certainly of opinion that it could not, subject to one thing I am going to say. Undoubtedly the area of administration in Scotland is very much smaller in many cases than it is in England. Unquestionably that does give rise to some difficulty in hard times, but you cannot, in my judgment, under a Bill of this kind, enlarge areas without disturbing the whole parochial system in Scotland. That is wholly outside the scope of the Bill, but I would not like Members of the House to think that that difficulty has escaped the attention of those who are responsible for the conduct of the Measure. We are glad to think that in many cases in Scotland the difficulty will not arise. We hope, so far as the financial strain is concerned, that that has reached its acme, and that with the new period of unemployment insurance in November, the relief by other measures—relief work and what not—the worst is past; but it may be that there are certain parishes—I have indicated their character—which will find it difficult to finance the position. I am glad to think that they are few indeed, but I would like to make this statement, that while I think the provisions of the Bill go far to secure alleviation, there may in such cases be something looked for in this way.

The general scheme, alike for England and Scotland, is that in these necessitous cases where banking or other financial administration breaks down, in such cases where, either in England the guardians, or in Scotland the parish councils, satisfy the Government that they cannot, out of the rates, provide money for relief, then, I understand—I know that the Secretary for Scotland has been in negotiation with the Chancellor of the Exchequer on this subject—the Government in those limited cases will he prepared to consider, under Parliamentary sanction, the provision of facilities for loans. There might be, indeed, exceptional cases in which the Government might not only so assist, but give some concession as regards interest, but that must be in that limited class of cases, which all of us hope may not arise; but I am bound to say that it is not in contemplation to alter the present rateable area. There is no objection, so far as I am aware, in law, indeed, there is some provision in the law as it stands, whereby parish A and parish B might well combine in these matters.

Under what Act of Parliament is the Government authorised to make these advances?

There is no Act of Parliament dealing with the matter at all. All that I say is that negotiations have passed between the Secretary for Scotland and the Chancellor of the Exchequer, and my information is to the effect I have stated. The Secretary for Scotland is fully aware of the critical position which might arise, which we hope will not, and I am glad to say that in these few limited cases, in regard to which he has been in communication with the Chancellor of the Exchequer, facilities otherwise than through the banks may be obtainable.

Does the hon. and learned Gentleman mean to say that a parish with a very small valuation might co-operate with one with a larger valuation, where the rates are less?

That might happen if they can persuade their friends of the larger area. There are one or two specific points—not Committee points—I should like to deal with. There was the very important point raised by the hon. Baronet the Member for Ayr (Sir E. Younger) as to the effect of Subsection (1) of Clause 2, in regard to the following provisions of the parish council, that it shall be entitled to pledge the assessments, present and future, with the limiting obligation that they are to be repaid within the five years. Personally, I have no doubt at all what that means. I am sorry that my answer, when the inquiry was first made, was not satisfactory. I said in my opinion there would be a continuing obligation. I think so now. There is no doubt that the rates, present and future, could be assigned as security, and because a period is put to the right of the debtor, that does not mean that the assignation and security is cut down. I have taken the trouble while listening to look up the form of bond which is referred to in Sub-section (2–3). It is a pure question of contract. Under the form of the Clause as proposed to-day the rate assigned as security is a continuing security. There was a specific point put by the hon. Gentleman opposite (Mr. W. Graham), and I will try and answer it. The law of which I spoke is the law of the right of recourse as between one point and another. Again, the law is that if a man is a fit subject for parochial relief in the parish where he lives, it is the duty of that parish to provide that relief. You have not to hunt up his place of birth or residence before you give the relief. The fact that he is there, and a fit subject for relief gives the claim. There is no intention of altering the law, and although I quite recognise that under these circumstances it may be more difficult, yet the preservation of the right of recourse once relief has been given between parish and parish might have the effect of spreading the burden more equally. As regards the point put forward by the hon. Member for Montrose Burghs, I do not agree, neither do I think it would be wise, to give the relief in the way suggested. I think that the central authority should retain some control, and accordingly I regret that I cannot concur with that view in either case.

I cannot concur in the view that in a measure intended to be of brief duration we should contemplate a longer period than that set forth in the Bill. If this Bill becomes law there will certainly be no disability in regard to providing relief for an able-bodied man. The relieving authority has an option of offering indoor relief and they have a full discretion as to the character of the relief to be given. I think that exhausts all the interrogations with the exception of one addressed to me by two of my hon. Friends opposite in regard to the legal qualification for "destitution." According to the report of the Poor Law Commission a person need not be reduced to a state of total and absolute destitution before becoming entitled to relief. Destitution is an elastic term, and experience points to this fact that one is on safer ground in the case of an elastic than a cast-iron term. I am informed that there have been numerous applications for relief to the Poor Law Authorities, and my information is that they have been dealt with in a humane and considerate manner. No complaint has been made, and I am bound to say that I do not think this House would uphold an administration which gave freely without making some inquiry, although I agree that it ought to be exercised in a perfectly reasonable way. I think that exhausts my queries with the exception of one put by the hon. Member for Dumbarton Burghs (Mr. Taylor), about the recipient of relief being disfranchised. The hon. Member is right in his assumption that the receipt of relief does not involve disfranchisement. With these explanations I hope the House will pass the Second Reading of this Bill.

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 .]

Forestry Bill

Order for Second Reading read.

I beg to move, "That the Bill be now read a Second time."

This is a very short Bill of only one Clause, and the object of it is simply to enable the Forestry Commission the better to expend the £250,000 which has been granted them for the purpose of relieving unemployment in country districts. The money is to be expended within the next six months entirely for the employment of unemployed labour in country districts and subject to the conditions which have been laid down in respect of other relief works, and it will be spent in accelerating the Commissioners' programme under the Forestry Act passed in 1919. Under that Act they had power to make advances either by way of loan or by way of grant to local authorities or individuals who are undertaking planting. These grants are subject to a condition put into the Act that they shall be repaid within a certain period many years later or, because the profits of afforestry are very remote. They would have to be repaid; whatever the expenditure after the local authority or individual had received 4 per cent, on his outlay. It is very unlikely that these grants would be repaid, but the condition involved keeping very elaborate accounts. It is thought that if we wish the local authorities or individual to undertake planting quickly it would be a great advantage to remove that condition in respect only of the money under this special grant, and in that case the advances will be permitted to be made to these individuals or local authorities subject to the permission of the Treasury in each individual case.

Does this cover the whole of Great Britain, or will the allocation be to different parts?

It covers the whole of Great Britain. The Forestry Commission is a body which operates all over Great Britain—England, Wales and Scotland. I am merely taking charge of the Bill because there is no Minister who is responsible for the Forestry Commission in this House. The Forestry Commissioners are proposing to expend this money according to whatever allocation they think fit in the three countries, and the principle they will proceed upon is to expend it in those districts where the land is suitable for planting and where there is much unemployment. The hon. Gentleman may rest assured that a considerable part will be spent in Scotland. In respect of this particular money voted for the purpose of employing unemployed labour, it is thought desirable, in order that we may get local authorities and individuals to work quickly, to suspend this particular condition, although as regards the general operations of the Forestry Commission the condition will not be suspended. And in this case the suspension will only be during the period of six months.

Question put, and agreed to.

Bill read a Second time.

Resolved, "That this House will immediately resolve itself into the Committee on the Bill."—[ Sir A. Boscawen .]

Bill accordingly considered in Committee, and reported, without Amendment; read the Third time, and passed.

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 Eighteen Minutes before Twelve o'clock.