House Of Commons
Wednesday, 7th July, 1943
[Mr. SPEAKER in the Chair]
Oral Answers To Questions
General De Gaulle
1.
asked the Secretary of State for Foreign Affairs, in view of the communiqué issued by the Associated Press of America, of which details have been furnished to him, whether he will give an assurance that His Majesty's Government is not pursuing and does not intend to pursue a policy hostile to General de Gaulle?
I would refer my hon. Friend to the statement made by the Prime Minister on 1st July in reply to Questions from the hon. and gallant Member for Ayr Burghs (Sir T. Moore) and the hon. Member for Seaham (Mr. Shinwell), to which I have nothing to add.
May we take it from that answer that the communiqué referred to did not in fact represent the views of His Majesty's Government?
I have an idea that the Prime Minister dealt with that in a supplementary, and I do not think I can improve on the answer.
Nazi Leaders (Fortunes In Foreign Countries)
2.
asked the Secretary of State for Foreign Affairs whether any steps are being taken to secure possession of the large fortunes which the Nazi leaders have placed in foreign countries?
In so far as the fortunes of the Nazi leaders are the fruits of acts of dispossession against the peoples of occupied Europe, the intentions of His Majesty's Government were made clear in the declaration issued by the Allied Governments on the 5th January last. As the Prime Minister stated in reply to the hon. Member for Stoke (Mr. Ellis Smith) on 1st July, it is not at present possible to forecast the arrangements that will follow the unconditional surrender of the enemy, but my hon. Friend may rest assured that measures will be taken so far as is possible to ensure that the Nazi leaders do not draw profit from their crimes, for which it is intended that full retribution shall be exacted.
Has my right hon. Friend any information about these fortunes, and will it be possible to secure some of them, at any rate, even before the war is over?
I had hoped from my hon. Friend's Question that he was going to give me a little information about them. If he has any, I shall be glad to have it.
Royal Air Force
Airmen, Fleet Air Arm (Promotion)
5.
asked the Secretary of State for Air whether he will take steps to ensure that airmen posted to Fleet Air Arm units as technical instructors are afforded the same opportunities for promotion as airmen employed in the Royal Air Force?
Airmen posted to the Fleet Air Arm remain on the central promotion rosters of the Royal Air Force, and their prospects in relation to those of other airmen for normal promotion are fully safeguarded. They are also eligible for local promotion, opportunities for which, as in the Royal Air Force, necessarily vary from one unit to another. If the hon. Member is aware of any cases where promotion seems to have been unduly delayed and will let me have particulars, I will have inquiries made.
Bomber Losses, Germany And Northern Europe
6.
asked the Secretary of State for Air how many British bombers were lost over Germany and Northern Europe during the month of June; and whether he can give a corresponding figure for the same month for losses suffered by American bomber aircraft over the same area?
276 British and 82 American bomber aircraft operating from this country were reported lost over Germany and Northern Europe during June, 1943.
Would my right hon. Friend agree that the total for the year is of the order of 1,430?
My hon. Friend must put that Question down.
Training
7.
asked the Secretary of State for Air what time-lag there is now betwen the registration of men for the Royal Air Force and the date they start their training; and how far avoidable delay takes place between the various stages of training?
The interval between registration and the start of training for-men enlisted for ground duties is eight to nine weeks of which five to six weeks are used in dealing with them under the machinery of the Ministry of Labour and National Service. The period of deferred service for aircrew personnel, which differs for each category of aircrew, necessarily varies from time to time for operational and other reasons. There is no avoidable delay between stages of training.
Is my right hon. Friend aware that there are cases in which five and six months have elapsed between registration and calling up for service, and will he bear in mind that in spite of the efforts of his Department this tends to produce disappointment and frustration in these young men who are eager and anxious to serve the country?
I am sure my hon. and gallant Friend understands that I regret any feelings of frustration that are caused by these delays as much as he does, but the position is that young volunteers—and they must all be young and all be volunteers for air-crew training—who can attain the necessary physical and mental standards required for air-crew training are limited in numbers. We must get all we can, but the rate at which we can pass them through the training organisation is regulated by the requirements of the operational squadrons.
Aircraftwoman (Case For Inquiry)
8.
asked the Secretary of State for Air when he proposes to reply to the letter of the hon. Member for Rugby, dealing with the case of 2004740, Aircraftwoman 1, Patricia Elizabeth Lane, No. 15 Group, Royal Air Force?
Inquiries into this case are not yet complete, but a reply will be sent to the hon. Member's letter very shortly.
Atlantic Air Service
9.
asked the Secretary of State for Air whether he is aware of the serious delays in the transport across the Atlantic of passengers and mail; and whether, in view of the importance of this traffic to war-time efficiency and post-war co-operation, he will discuss with the United States Government the advisability of allocating enough bombers to the transatlantic service to ensure regular and frequent service for priority passengers and urgent mail?
There is no delay at the present time in the conveyance of either passengers or mail by British-controlled air services across the Atlantic. Passengers, whose applications are officially sponsored and approved, are provided with passages within an average time of two days of receipt of notification that they are ready to travel. If, of course, a passenger wishes to travel by a particular route, he may have to wait somewhat longer before he can be accommodated. Air mail is being conveyed as it becomes available.
Can my right hon. Friend assure us that this encouraging and rather surprising average will not go down when the winter months come, because is he not aware that every Government Department that has business in Washington has a number of important officials who are needed on one side of the Atlantic or another quickly and can, not get there without delay?
I cannot claim to be able to prevent weather delays during the winter months. I can only answer the Question which my hon. Friend has put down.
Cannot an adequate number of machines be allocated specifically for the Trans-Atlantic passage?
I think it is clear from the answer that the number of machines allocated is adequate.
Does not my right hon. Friend consider that bombers are better employed doing what they are doing than carrying priority passengers across the Atlantic?
The bombers are doing magnificent work.
Aircraft Production
Houses And Bungalows
10.
asked the Minister of Aircraft Production the numbers of houses and bungalows built by or for his Department within a radius of five miles of a town of which he has been informed; their individual cost; and is he satisfied that they are suitable as permanent dwellings?
The answer to the first part of the Question is 826; to the second part, £708 on the average. As regards the third part, the bungalows are not intended as permanent dwellings.
Is my right hon. and learned Friend aware that these buildings are damp and not even fit for animal let alone human habitation; and, in view of their great cost, could not they have been made of a permanent character instead of time and money being wasted in putting up unsuitable temporary buildings at such cost?
I am aware that there has been some complaint about the dampness of these buildings. That has, I hope, now been rectified, and at the beginning of last month the secretary of the tenants' association expressed himself as quite satisfied with the conditions of the buildings.
11.
asked the Minister of Aircraft Production the shortest and longest time taken to erect houses and bungalows, built by his Department or on his instructions from the time the decision was made for their erection until they were lived in, within a five mile radius of a town of which he has been informed?
The shortest time between the decision to erect and the date of occupation was eight months. The longest time cannot be stated since some of the bungalows, though completed many months ago, have not yet been occupied.
In view of the length of time taken to build these bungalows, does not my right hon. and learned Friend think that they should have been made fit for permanent habitation instead of time and labour being wasted in putting up these unsatisfactory buildings?
I am afraid that I cannot enter into a consideration of the matters that weighed in 1941 when the decision was made to erect these bungalows.
Are the floors of these bungalows of concrete or boards?
I cannot say without notice.
In future would it not be a wiser and more economical policy to spend a little more money so as to make these buildings of a permanent character?
That is being considered in regard to the other buildings.
Messrs Short Bros
12.
asked the Minister of Aircraft Production whether he is aware that dissatisfaction with the management of Short Brothers, Limited, was expressed at a workers' meeting organised by the Amalgamated Engineering Union, and supported by other trade unions, outside a Shorts' factory on 30th June; and what communication he has received from the unions or workers concerned?
The answer to the first part of the Question is "Yes, Sir," and to the second, "None, Sir." I understand, however, that negotiations are pending in regard to the conditions and the rates of wages which were in operation when the new management took over control. These negotiations will, of course, be conducted through the approved machinery.
Has not my right hon. Friend received a communication dated 3rd July from the Swindon Branch of the Clerical and Administrative Workers Union setting forth 11 different points in which they consider the workers have been unfairly treated by both the old board and the new board?
I have seen a letter from the Swindon Branch which has no relation to the matters at Rochester, and a number of points were drawn to my attention in that letter. They are all receiving attention, and some have already been dealt with.
Are the rumours going about true that production is decreasing instead of increasing since the company has been under my right hon. and learned Friend's command?
I think that those rumours are perhaps put about by people interested in the old management. They are not true. I said last week what: the position was.
Is the Minister aware that among the workers there is a deep suspicion that some of the Tories are getting at the management?
I can assure my hon. Friend that nobody is getting at the management.
What evidence has my right hon. and learned Friend that such rumours have been put about by the old management?
I said I can only suspect that they are put about by the old management.
Royal Navy (Reserve And Temporary Officers)
13.
asked the First Lord of the Admiralty whether he has considered the representations made to him on the employment, promotion and appointments of Royal Navy (Retired), Royal Naval Reserve and Royal Naval Volunteer Reserve officers; and whether he can make a statement?
The suggestions which my hon. Friend made during the Debate on the Navy Estimates have now been fully considered. Since my reply is inevitably rather long, I will, with your permission, Mr. Speaker, and that of my hon. Friend, make a statement at the end of Questions.
Later—
The question of making arrangements in peace for ascertaining the capabilities of retired officers in order to secure their appropriate employment when called up is one which will have to be dealt with after the war. I have arranged that my hon. Friend's suggestions should be placed on record to be brought up at that time. My hon. Friend also referred to the possibilities of promotion for retired officers. I can assure him that these officers are given acting promotion during their re-employment as freely, and on the same basis, as active service officers.
As regards the appointments open to Reserve and temporary officers, I can state definitely that no officer is barred from any appointment for which he is fitted merely because he is a reserve or temporary officer. It is the policy of the Admiralty to give important appointments to such officers in increasing numbers, and there are now officers of the R.N.V.R. and R.N.R. in command of destroyers, of submarines and of groups of corvettes, and others are executive officers of large vessels such as cruisers, with the rank of commander. My hon. Friend also raised the question of promotion and suggested that the Reserve and temporary officers are not receiving promotion in accordance with their employment. This belief, which is possibly widely held, is ill-founded. A Fleet Order was issued last September which was designed to encourage the promotion of such officers to the rank of acting lieutenant commander, and over 1,000 officers have already been so promoted under that order alone. Instructions have been issued to make it clear that recommendations for such promotion should not be limited to officers who are capable of performing all the duties of lieutenant commander's rank: normally it will be sufficient if an officer is able to perform the duties of that rank in the branch in which he has specialised. We are now in a position to make promotions also to the rank of commander from among temporary officers as well as from the officers of the permanent Reserves. These promotions to lieutenant commander and commander are semi-permanent promotions, which do not depend on the officer remaining in a particular appointment. In addition, there are continual cases of appointments which can be most suitably filled by Reserve and temporary officers and which carry the grant of one or more steps in acting rank. There will be no hesitation on the part of the Admiralty to grant the necessary acting rank in such cases, and there is now no rule or practice which prevents the grant of double acting rank where it would be appropriate to an appointment of this kind. Reserve officers with sea experience are already employed at the Admiralty, and inevitably the number so employed will increase. In accordance with a recent decision, a commodore R.N.R. and a commodore R.N.V.R. have been appointed as Naval Assistants to the Admiral Commanding Reserves. As regards staff courses, officers of the Special Branch of the R.N.V.R. intended to replace R.N. executive officers have received, ever since 1940, a course of instruction in their duties. This course now extends to six weeks. My right hon. Friend the Financial Secretary explained on 17th March that staff courses proper would be re-opened for both R.N. and Reserve officers. This has now been done, and it is the intention that a large proportion of Reserve officers shall be appointed to these courses. In conclusion, I should like once again to express the appreciation of the Board of Admiralty for the invaluable services rendered by the officers of the Naval Reserves in every sphere of the war at sea. The work they have done, and are doing, is thoroughly admirable, and it is the policy of the Admiralty that they shall have prospects commensurate with services they have rendered, and comparable to those of corresponding officers of the other Services.While it is impossible to comment on the very important statement which has been made by the Minister, may I ask whether he realises that it will give great satisfaction to many Reserve officers?
Is it not time that the Board of Admiralty reviewed the whole question of the age at which a lieutenant in the Navy can be promoted to lieutenant-commander? Is it not a fact that a man of 25 or 26 years of age might be a group captain in the Royal Air Force or a lieutenant-colonel in the Army while a man in the Navy, who has been an officer for eight years, has to remain a lieutenant until he reaches the age of 29 or 30?
Is not this rather an unusual way of trying to have a Navy Estimates Debate?
I do not think the point raised by my hon. Friend the Member for Norwich (Sir G. Shakespeare) arises on this Question, but I will keep it in mind.
Will the Minister give an assurance that a number of these Reserve officers will be given full facilities to be absorbed into the Regular Force after the war?
That is a larger question than the one on the Paper.
West Indies (Sugar Industry)
14.
asked the Secretary of State for the Colonies by whom the West Indian Colonies were represented at the International Food Conference recently held in the United States of America; and whether he will give an assurance that the interests of West Indian sugar producers are not neglected or subordinated to foreign interests inasmuch as Cuba was represented at the conference?
It is not constitutionally possible for Colonial territories, whether British or foreign, to be separately represented at international conferences, but the United Kingdom delegation included a senior officer of the Colonial Office, who was responsible for watching Colonial interests. His Majesty's Government will certainly not neglect the interests of British Colonial sugar producers or allow them to be subordinated to foreign interests.
15.
asked the Secretary of State for the Colonies whether he is aware of the grave situation facing the sugar industry of Trinidad on account of shortage of labour; whether he contemplates the importation of labour from other West Indian islands now suffering from unemployment; and, if so, what practical measures are being considered to meet the consequential housing problem?
My hon. and gallant Friend will have seen from my reply to the hon. and gallant Member for Blackburn (Sir W. Smiles) on 1st July that neither I nor the Colonial Government regard the present position of agriculture as a whole in Trinidad as satisfactory; also that we are aware of the serious difficulties facing the sugar industry. In reply to the last two parts of the Question, I would refer to the last part of my reply on 1st July. I am at the moment in telegraphic communication with the Governor on this matter.
Would my right hon. Friend consider approaching the appropriate American authorities and requesting them to import labour for their own purposes and so release numbers of natives to return to their normal employment?
I am seeing what can be done, but my hon. and gallant Friend will realise that it is largely a question of transport.
May not one of the difficulties be that higher wages are attracting natives away from their ordinary jobs?
There is an all-round shortage of labour in Trinidad at the moment.
Palestine
Crusader Castles
16.
asked the Secretary of State for the Colonies whether he will see that the restoration and preservation of the Crusader castles of Palestine will have an equal priority with the excavations of prehistoric civilisations?
I am in sympathy with my hon. Friend's intention and will consider it in consultation with the High Commissioner for Palestine to see what can be done after the war.
Are we not prepared to collaborate with other countries in archæological work of this kind?
Should not adequate housing be the first consideration?
I think we must always give priority to the living rather than to the dead.
Is there any necessity for these excavations to be continued now?
I said I had no intention of doing the excavations now. I said "after the war."
Is my right hon. and gallant Friend aware that the Crusader castles in Palestine are the biggest potential tourist attraction in the country and that they are rapidly crumbling, and will he bear that aspect of the matter in mind?
Housing Conditions, Haifa
22.
asked the Secretary of State for the Colonies whether he is aware that the Municipal Council of Haifa, Palestine, reports that at least 10,000 persons are living under unhealthy and insanitary conditions owing to shortage of housing accommodation; and whether, in the absence of private house building, he will recommend the Government at the first convenient opportunity to take remedial action?
I am aware of the shortage of suitable housing accommodation in Haifa, and I am satisfied that the Government of Palestine are fully alive to their responsibilities in the matter. Although substantial progress cannot be made under war conditions, detailed schemes will be prepared in readiness for the time when progress can be made.
The Minister will be aware that it has been reported that there is a considerable amount of sickness, with other evils, due to the congested state of the population?
I should be only too glad, and we will do everything we can, to remedy the position, but the shortage of labour, and above all the shortage of materials, make that impossible in wartime.
Post-War Reconstruction
23.
asked the Secretary of State for the Colonies whether he can give an assurance that in the postwar schemes for reconstruction in Palestine there will be no interference with industrial development essential for expanding the sources of livelihood and for the absorption of new immigrants?
The report, which is to be made by the Reconstruction Com- missioner, has not yet been received by the Palestine Government, and I cannot anticipate its contents. I am, however, sure that the plans for post-war reconstruction will be designed to encourage rather than to interfere with sound industrial development.
Colonial Empire
Official Report, House Of Commons
18.
asked the Secretary of State for the Colonies the number of Governors of Crown Colonies; and the number of these officials whose offices are regularly supplied with Hansard?
There are 29 Colonial Governors, including the officers responsible for the administration of Protectorates and Mandated Territories. For many years past, bound copies of Hansard have been sent immediately after their issue to all Colonies, except Aden, to which this arrangement is now being extended.
Is there any assurance that they are read by them?
I am afraid I could not give that assurance without consulting all the Governors.
Labour Supervision (Report)
20.
asked the Secretary of State for the Colonies whether the Report on Labour Supervision in the Colonial Empire will be made available to Members?
Yes, Sir. This Report was published yesterday, and is now available to Members in the Vote Office.
May I thank the right hon. and gallant Gentleman and also congratulate his Department on the publication of this Report; and may I express the hope—[HON. MEMBERS: "No."] May I ask the right hon. and gallant Gentleman whether he will give the widest publicity to this Report, both in this country and in the United States?
Has the hon. Member had the opportunity of seeing the Report? If not, how can he offer congratulations?
Perhaps I can answer that. This is not a Parliamentary Paper. It was, in fact, published in the Press yesterday, and any hon. Member would have had the opportunity of reading it.
Kenya (Compulsory Labour)
19.
asked the Secretary of State for the Colonies whether he can make a statement on the reintroduction of forced labour of Africans for work on European farms in Kenya?
24.
asked the Secretary of State for the Colonies whether he can make a statement regarding the revival of conscript labour in Kenya; whether such labour is to be available for private employers; and whether, as such conscription of native labour is a violation of the spirit of the Forced Labour Convention of 1930, which has been ratified by His Majesty's Government, the views of the Chief Native Commissioner have been ascertained as to the effect of this conscription on conditions in the native reserves?
The Governor has reported that he has decided to remove, in respect of sisal only, the suspension which was laid in February last upon the compulsory recruitment of Africans under the Defence regulations. This industry is of cardinal importance to the war effort now that supplies from the Far East for agricultural and marine purposes are no longer available to the United Nations. The employment of this labour on the sisal estates, which are privately owned, will be on the same conditions as previously, with all the safeguards which have been in force throughout. These are set out in the reply given to the hon. Member for Shipley (Mr. Creech Jones) on 4th March, 1942. The Chief Native Commissioner is a member of the Governor's Executive Council, and his views will therefore have been taken fully into consideration.
May I ask my right hon. and gallant Friend whether the food supply in reserve has now been improved?
I do not quite understand what the hon. Gentleman means by "improved." The position has eased. This production of sisal is of very vital importance, not only to ourselves, but particularly to the United States of America.
Has the attention of the right hon. and gallant Gentleman been drawn to a report in "The Times" newspaper of 1st July, in which the Chief Native Commissioner stated that he warned the Commission against withdrawing labour, and may I ask whether the Chief Native Commissioner was overruled?
Not to my knowledge, nor, I think, if the hon. Gentleman will look again at "The Times" report, will he find that "The Times" did suggest that.
Is there any reason why there should not be recruitment of labour in Kenya as well as in this country?
Will the right hon. and gallant Gentleman consider sending a politely-worded letter to the sisal farmers suggesting that adequate wages might secure the labour?
I very much doubt whether in fact that would be the result.
Malaya Invasion (Asiatic Population's Attitude)
21.
asked the Secretary of State for the Colonies whether in the light of information now available, he is in a position to make any further statement regarding the attitude of the Malay, Chinese and Indian inhabitants of Malaya towards the Japanese at the time of the invasion?
The personal impressions of many who had first-hand knowledge of the campaign confirms the belief that the great bulk of the Asiatic population of Malaya was completely loyal to the British connection. Many of the earlier allegations of treacherous behaviour may be attributed to the difficulty of the inexperienced in distinguishing the lightly equipped Japanese soldiery from the local Asiatic population. I hope shortly to be in a position to deal more fully with this matter.
Is it not the case that many of these Malayans who were demonstrating against the Japanese had their demonstration broken up by the police just a day or two before the invasion?
No, Sir.
Malta (Future Constitution)
25.
asked the Secretary of State for the Colonies whether he can make any statement regarding the future constitutional development of Malta?
With the permission of Mr. Speaker and the hon. and gallant Member, I propose to make a statement at the end of Questions.
Later—
His Majesty's Government have had under consideration certain representations which have been made by the Elected Members of the Council of Government in Malta, who have asked for an announcement regarding their intentions in relation to further constitutional development. Since the present Constitution of Malta was inaugurated in 1939 the fortress has successfully withstood a siege of two and a half years. During the siege the island was subjected to heavy and sustained attacks from the air and to a food shortage of increasing gravity. By their steadfastness and fortitude under the severe hardships thus occasioned the people of Malta, together with its gallant garrison, rendered services of incalculable value to the Allied cause. His Majesty's Government have noted with particular satisfaction that throughout the whole of this period the Council of Government continued to discharge its normal functions in relation to legislation and the discussion of public affairs.
For more than 10 years, between 1921 and 1933, the people of Malta enjoyed full legislative and administrative responsibility under the Crown in the conduct of their internal affairs, the control of Naval and Military Services and of all matters appertaining to the position of Malta as an Imperial fortress, or otherwise affecting Imperial interests or policy, being reserved to the Imperial Government. It is the policy of His Majesty's Government that responsible government in the same sphere should again be granted to Malta after the war. It will not be possible while the war continues for His Majesty's Government to undertake a detailed examination of the various constitutional, financial and administrative questions which must be resolved before responsible government can be introduced, nor can some of these questions, in particular those which arise in connection with finance, be defined until the Malta Government are able to visualise more clearly the extent and the cost of the plans for reconstruction and development with which they will be faced after the war. But it is the intention of His Majesty's Government, as soon as hostilities are brought to an end, that these matters should be pursued without delay, and that steps should be taken to consult responsible opinion in Malta with a view to giving expression as far as possible to the wishes of the Maltese people regarding the form which the new Constitution might take.While the Government's proposals, when they emerge, will require very careful examination in view of the past history of self-government in Malta, will my right hon. and gallant Friend bear in mind that the Maltese people as a whole will be most grateful for this great step forward, which, I am sure the House will agree, they have earned by their splendid conduct, not for the first time in their history, in withstanding a rigorous siege? I am sure the Maltese people will be delighted with the Minister's statement.
Pending the happy day when we give the Maltese a better Constitution than they now have, will the Government encourage the Maltese by seeing that Government establishments in Malta pay Maltese civil servants the same rate as English civil servants and not about half the rate?
Driving Licences (Minimum Age)
26.
asked the Parliamentary Secretary to the Ministry of War Transport whether there was any appreciable rise in the road accidents figures in the last war after arrangements were made for the minimum age for obtaining a driving licence to be reduced to 16 years?
The arrangements referred to by my hon. Friend came into force in August, 1918, and lapsed in August, 1921. I regret that there is no record of the number of driving licences issued to youths of 16, nor of the ages of drivers involved in accidents. The total number of road accidents in 1918 was 36,685; in 1919 the number was 49,750.
In view of that answer, will the hon. Member reconsider his previous decision if representations are made by a hard-pressed industry who can show that there would be considerable economy of man-power if this facility were granted?
If it can be shown that there would be economy of manpower, I shall be glad to consider it again, but we have considered it in view of the large number of women drivers now available who were not available in 1918, and we think it is not necessary to introduce this change.
Railways
Hop-Pickers, Kent
27.
asked the Parliamentary Secretary to the Ministry of War Transport what arrangements are being made to take the men, women and children down to the hopfields in Kent in August, in view of the bad transport and the overcrowding at London Bridge railway station last year?
Last year arrangements were made by the National Farmers' Union and the Southern Railway Company for the transport of hop-pickers to Kent by special trains. Most of the hop-pickers, in fact, travelled by these special trains, on which there was no overcrowding. Similar arrangements are being made this year, and I hope that, if adequate notice is given of the number of passengers who intend to travel, no difficulty will arise.
Shunting Accidents
31.
asked the Parliamentary Secretary to the Ministry of War Transport whether he is aware that on account of bad lighting at two shunting places, of which he has been informed, a number of shunting accidents have taken place; and what he intends doing about the matter?
I have made inquiries, and I understand that there has been only one slight accident this year at one of the places referred to by my hon. Friend; and that there have been no accidents at all at the other. At both places, the lighting is of the standard permitted in this area.
Post-War Transport (Organisation)
28 and 29.
asked the Parliamentary Secretary to the Ministry of War Transport (1) when he contemplates being able to make a statement on the post-war policy of his Department in respect of docks and ports;
(2) when he anticipates being able to make a statement on the policy of his Department in regard to the organisation of post-war transport?My Noble Friend is actively considering the many complex problems involved in the post-war organisation of transport, and of docks and ports, but he has not yet reached the stage at which he can submit definite proposals to his colleagues in the Government.
In view of the fact that decisions on recent points created the impression that they were a necessary preliminary to decisions in a number of wider fields, can the Minister give us any indication when he will be likely to make a statement?
I am afraid I could not mention a date, but I should like to assure my hon. Friend that my Noble Friend is fully alive to the importance of the matter and that a great deal of the preparatory work has been done. My Noble Friend is, of course, very busy operating the transport system for the war effort.
Are the plans being prepared in consultation with the Minister without Portfolio, or is this being done in isolation?
There is, of course, consultation with the Minister without Portfolio.
What is the function then of the Minister without Portfolio in reconstruction matters?
I say that we are in consultation.
Post-War Road Development
32.
asked the Parliamentary Secretary to the Ministry of War Transport whether he can make a statement on his Ministry's proposals for postwar road development; what decisions have been made; and when will they be presented for consideration to the House?
My Ministry have prepared plans for a large number of road improvements, which can be carried out when conditions permit. But I am not yet able to make any statement about the general policy of the Government with regard to post-war road development, nor about the specific proposals which the Government has in view. Nor can I now foretell when it -will be necessary to ask for whatever statutory powers may be required.
Will not my hon. Friend endeavour to expedite this information, because the lack of it is holding up development of many large housing proposals?
Yes, Sir. We have done a lot of work, and we are anxious to get on.
Would my hon. Friend consider publishing that information as soon as possible, as it is most desirable that it be known?
I do not think that we have yet reached a stage where we could usefully publish anything, as we might do more harm than good.
Have the plans been sent to the Minister without Portfolio, and has he made any comment upon them?
We have been in consultation with the Minister without Portfolio.
I asked whether the Minister without Portfolio had seen the plans and had made any comment.
It would be most improper for me to say what comment the Minister might have made.
Is not the hon. Gentleman aware that speculative purchases of land at inflated prices are going on all the time and that if they are allowed to continue they will jeopardise any plant?
Deceased Seamen's Effects
33.
asked the Parliamentary Secretary to the Ministry of War Transport whether effective machinery exists for the return of the effects of a deceased seaman to his next-of-kin; and whether it is the normal practice to require the next-of-kin to pay postage for the return of such effects?
Yes, Sir, there is machinery for returning the effects of a deceased seaman to his next-of-kin, and I think it works smoothly and well. Effects are now delivered free of charge.
Would the hon. Gentleman investigate the case of the widow of a merchant seaman, herself serving in the W.A.A.F., who applied for the effects of her late husband to be returned to her but was told by the superintendent of the Mercantile Marine office in Liverpool, in a letter which I have here, that if she would kindly fill up form WDC and send a postal order for 3s. 6d., her husband's effects would be returned?
That letter must have been dated some time ago, since when a new arrangement has been in force.
It is dated May, 1943.
Yes, Sir; and it is since then that the new arrangement has been in force.
When was the new arrangement introduced?
It was introduced-some weeks ago, not more than a month.
Will this woman get her 3s. 6d. back?
Ministry Of Information
Catholic Workers, France And Belgium
34.
asked the Minister of Information whether his attention has been called to the recent protest made by three French Cardinals on the refusal of the German Government to allow priests to accompany French workers deported to Germany; whether a similar protest has recently been made by the Belgian hierarchy; and whether this insult to the authority of the Catholic Church in France and Belgium can be widely broadcast in the United States of America?
Yes, Sir. I understand that a similar protest to that of the French Cardinals was made in a Lent Pastoral Letter by the Belgian Cardinal-Archbishop and Bishops. As my right hon. Friend said in reply to Questions by my hon. Friend on 30th June, protests issued by the Churches against Nazi crimes have received wide publicity in the United States.
Is the Minister satisfied himself that these protests are widely known in the United States of America?
According to my information, very wide publicity has been given in America to this matter.
Propaganda To Italy
35.
asked the Minister of Information whether he will consider allowing the small Italian organ of freedom, "Lettera Italiana," to be enlarged and printed; and whether the Italians here may broadcast for five minutes once every 24 hours in Italian to Italy?
My right hon. Friend regrets that in present circumstances he cannot give increased facilities to any foreign language periodicals. With regard to the second part of the Question, the Free Italian Movement already has broadcasting time on four days a week. The hon. and gallant Member will, I am sure, appreciate that the time available in the European Services of the B.B.C. for broadcasting in Italian is already fully occupied and I do not think that there will he any opportunity of supplementing the broadcasts by the Free Italian Movement.
Does not my hon. Friend think that it would be one of the most important functions of this Department to win over the enemy by more frequent propaganda of this sort?
There is no dispute as to the importance of propaganda to Italy, and we are doing the best we can in that respect.
Vc Citations (Book Form)
36.
asked the Minister of Information whether he will arrange for the publication in book form of the citations for which Victoria Crosses have been awarded?
These heroic deeds receive wide publicity in the Press and on the radio, and I should not have thought that there was any big demand for them to be published in book form for sale at home. But I am having inquiries made and if these show that there is such a demand the Ministry will see what can be done about it.
Will my hon. Friend bear in mind the possibility that the relatives would like to have a record of these citations on their bookshelves?
Certainly, Sir.
Would it not be a good idea to have these citations in book form so that, after the war, they could be read out once a year to the school children?
I can assure the Noble Lady that her suggestion will be borne in mind.
Newspaper "La Marseillaise"
37.
asked the Minister of Information whether he is aware that the articles printed in the paper, "La Marseillaise," published in London, are not calculated to improve relationships with our Allies; and what steps he proposes to take to deal with the newspaper concerned?
The licence given to this newspaper has now been withdrawn.
Has this matter anything to do with the fact that this paper espouses the cause of General de Gaulle?
The hon. Member may remember that my right hon. Friend indicated in this House about two weeks ago that, if any of these publications attempted to stir up discord among the United Nations, he would take steps to have their licences withdrawn. This decision is in accordance with that statement.
I naturally accept that explanation from my hon. Friend, but I ask the question pointedly: Has this decision anything to do with the fact that this paper espouses the cause of General de Gaulle?
Not at all, Sir.
Is there a copy of this paper in the Library of the House? If not, could the last 12 issues or so be put there?
So far as I know, it is not in the Library. I will consider whether we can put the last 12 issues into the Library.
In view of the reports published this morning of the method by which this paper was suspended, are we to take it that the Paper Control is now used as an instrument of censorship?
Not at all. The Regulations governing the use of paper were drawn up in order to prevent the wasteful use of paper, and I should imagine this action has been taken in accordance with that purpose.
Is it not the case that this paper criticised the wrong Ally? Have not other papers slandered the Soviet Union and nothing has been done about it? [HON. MEMBERS: "Oh!"] I will produce the slanders.
I beg to give notice that I will raise this matter on the Adjournment.
Air Warfare (Broadcast Commentary)
38.
asked the Minister of Information by whom, and on what grounds, the successor to the hon. and gallant Member for Watford (Group Captain Helmore) as three-weekly broadcaster of the Royal Air Force commentary was selected?
The selection of persons to give the war commentary on air affairs is primarily a matter for the B.B.C., who consult the Air Ministry in the ordinary course and obtain their consent in the case of a serving officer.
Is it not a fact that this officer does not wear wings, and is he not singularly ill-qualified to express the views, thoughts and opinions of the R.A.F.; and is it not a fact that his selection is causing a good deal of comment among pilots, particularly in view of his past record?
I am not aware of any such dissatisfaction or any such comment. I can only assume that the B.B.C. selected this officer for this purpose because they thought he was suitable.
Is the hon. Gentleman aware that these broadcasts are in fact of a very high order and are listened to with great appreciation?
German War Crimes (Reports)
39.
asked the Minister of Information whether in possible collaboration with other Allied Governments, he will consider the preparation and publication of an up-to-date comprehensive report on German atrocities in occupied Europe?
The preparation of a comprehensive report such as the hon. Member contemplates has been envisaged for some time, and a United Nations Commission for the Investigation of War Crimes is to be set up for that purpose. To this Commission the lists already prepared by the nations concerned will be submitted. I would not wish to pre-judge the views of that Commission by making any promises in regard to publication of their report. In the meantime may I remind the hon. and gallant Member of the series of reports on this subject issued by the Inter-Allied Information Committee and on sale at His Majesty's Stationery Office?
Will my hon. Friend do his best to give wide publicity to these reports in view of the fact that the Germans are very obviously starting to organise sympathy for themselves?
I will see what can be done.
Agricultural Workers' Cottages
42.
asked the Parliamentary Secretary to the Ministry of Works whether it is his intention to utilise the services of small local builders for the erection of agricultural cottages, especially in districts where only a few are to be built?
I would refer my hon. Friend to the statement made by my right hon. Friend the Minister of Health on 10th June, of which I am sending him a copy. This made it clear that the question of these cottages, which are to be provided by local authorities under their Housing Act powers, being built by big builders will only arise if local authorities cannot obtain satisfactory tenders from local builders by 8th July. I am assured by my right hon. Friend that local authorities have followed their usual practice of advertising for tenders, and have thus given the smaller local builders the fullest opportunity.
Is the hon. Member aware that there is a feeling among the small builders that they are being squeezed out and not being allowed to tender? Is he also aware that there is a feeling that the big contractors have the men taken away from these small builders, and is he further aware that his answer will give great satisfaction to many of these very excellent small builders, who are well able to do this kind of work?
Thank you.
Building Costs
43.
asked the Parliamentary Secretary to the Ministry of Works precisely what items caused the rise of 25 per cent. in building costs, which occurred between 18th March, 1943, and 2nd June, 1943?
I regret that it is not possible to state precisely the items that have contributed to the rise in the cost of building. Periodical comparisons of the total costs of works carried out show the general trend, but there is great variation in regard to the different types of building and construction. My Noble Friend in referring last month to a rise of 105 per cent. had in mind the construction of agricultural cottages built in isolated pairs or fours in small villages all over the country.
In view of the great importance of the country knowing how this rise in costs has occurred, can I be given information if I put down a Question at a later date?
Is not the main cause of the rise in building costs the policy of the Ministry of Works about labour?
I would not agree with that.
Can I have a reply to my Supplementary Question?
It would be very difficult to reply unless I could hear the question.
In order to give the hon. Gentleman a chance to reply, I beg to give notice that I shall raise the matter on the Adjournment.
Coal Prospecting, Swansea Public Park
44.
asked the Parliamentary Secretary to the Ministry of Works whether he can give any information in connection with the coal borings in Swansea public park; what kind of coal has been found, soft or hard; and will the public be debarred from entering the park whilst the boring is going on?
Prospecting is just about to begin so that the quantity and quality of coal involved cannot yet be stated. Inconvenience to the public will be reduced to the minimum. The arrangements have been agreed with the local authority.
Can the Parliamentary Secretary give any reason why he should damage this splendid park?
It is not a question of that. It is a question of getting coal.
I would like to thank the hon. Member who put down this Question, but is he aware that Swansea is adequately represented in this House?
Eire Citizens (British Armed Forces)
45.
asked the Prime Minister how many men ordinarily domiciled in Eire are now serving in the Armed Forces of the Crown; how many have become casualties; and how many have received decorations?
I regret that the figures asked for by my hon. and gallant Friend are not available.
Has my right hon. Friend any idea whether the figure of 300,000 Irishmen from Southern Ireland fighting in the Armed Forces of the Crown is approximately correct, and if it is correct is it not a very great tribute to Irishmen who fight voluntarily for the Crown despite the neutrality of their Government?
I regret I have no information available.
Would it not be useful to extract the information in order to show that there are many Irishmen who do not accept Mr. de Valera's conception of neutrality?
The figures are not available.
Surely the information is in the records of these gallant officers and men and can be easily extracted?
Building Trade Apprentices (Demobilisation)
46.
asked the Minister without Portfolio whether any instructions have been given to permit of the prior demobilisation of young soldiers as apprentices for the building trade?
No, Sir. There is provision within the general framework of the demobilisation scheme for considering the question of early release in cases of national importance, but my hon. Friend will realise that these exceptional cases will have to be kept to a minimum if the scheme is not to break down: it is certainly too early yet for any particular instructions to be given.
In view of that reply and the public statement which was made by one of his colleagues, which gave an impression that there would be some sort of priority, does not my right hon. and learned Friend think it advisable not to discuss schemes of demobilisation piecemeal?
Food Supplies
White Fish Landings, Peterhead
48.
asked the Parliamentary Secretary to the Ministry of Food whether he will take action to increase the buying power for white fish landings at Peterhead?
Yes, Sir. Such arrangements have been made and are now in operation.
Herring Prices
49.
asked the Parliamentary Secretary to the Ministry of Food whether he can make any statement on the subject of herring prices?
Further consideration has been given to the recent reduction in the maximum price on a first hand sale of herring but as at present advised my Noble Friend is not prepared to depart from the new maximum price of 3s. 3d. per stone. He is prepared, however, in conjunction with my right hon. Friends the Ministers responsible for Fisheries, to examine any further facts or figures which the trade may produce to him.
Will my hon. Friend give an assurance that no further changes of this character will be made without prior consultation with representatives of the fishermen?
I think I can give that assurance.
| 1st October. 1942. | Figures as at latest available date. | |||
| Depot proprietor | … | 259 | 217 (1.5.43) | |
| Wholesalers | … | Information not available | … | 477 (31.5.43)* |
| Self-wholesaling retailers | … | Information not available | … | 378 (31.5.43)* |
| Retailers | … | Information not available | … | 109,341 (1.1.43) (including producer-retailers with consumer registrations). |
| Producer-retailers | … | 60,326 | 58,115 (1.4.43) | |
* Figure may be slightly reduced. | ||||
Londoners' Meals Service
51.
asked the Parliamentary Secretary to the Ministry of Food whether, in view of the fact that the average receipt per customer served in restaurants of the Londoners' Meals Service is 12.26 per cent., and the average expenditure 11.60 per cent., he will explain how these undertakings do not make a gross profit?
I presume my hon. Friend means "pence per meal" and not "per cent." Although at the present time the income of the Londoners' Meals Service exceeds expenditure, the trading accounts for the whole period since the inception of the Service still show a deficit.
In view of the fact that the Ministry, and therefore this House, helps with the financial side of the meals service, is the hon. Gentleman satisfied that the meals service is being
Can the hon. Gentleman inform Members where they can be bought?
Milk (Distributing Firms)
50.
asked the Parliamentary Secretary to the Ministry of Food whether he can give the numbers of milk distributing firms in business at 1st October, 1942, and 31st May, 1943, in the following or other convenient categories: depot proprietors, wholesalers, self-wholesaling retailers, retailers and producer-retailers?
As the answer involves a tabular statement, I will, with my hon. and gallant Friend's permission, circulate it in the OFFICIAL REPORT.
Following is tie statement:
efficiently and economically conducted, and if not will he take steps to have an inquiry?
The hon. Member must bear in mind that this meals service operated for a considerable period during the heavy blitz.
Soya Flour Order
52.
asked the Parliamentary Secretary to the Ministry of Food whether he will explain the purpose of paragraph 6 of the Emergency Powers (Defence) Food (Soya Flour) Order, S.R. and O., No. 855 of 1943; and whether he will publish some explanatory note for the guidance of traders, in order that they may not unwittingly render themselves liable to prosecution?
As I explained to my hon. Friend last week, the purpose of this Article, which appears in all price control Orders made by my Department, is to make it an offence to evade price control by a collateral and collusive bargain which is artificial. My Noble Friend sees no need for the action suggested by my hon. and learned Friend.
As my hon. Friend has said it is impossible to define the expression "artificial transaction," does not this paragraph create an offence which is in itself undefinable?
On many occasions this House has insisted that artificial transactions should be prevented, and the House insists on this sort of provision being made.
Is it not a question of opinion rather than of fact?
Yes, Sir.
Is the hon. Gentleman aware that almost every grocer knows exactly what is meant by the Order and the meaning of the term "artificial transaction"?
Is not the inference that it is more or less unintelligible, and if an explanatory memorandum was supplied with these Orders, would it not save a good many questions being put in this House and at the same time be an advantage to the traders of the country?
We should be very glad to issue an explanatory memorandum if it were here appropriate, but an explanatory memorandum here would be usurping the functions of the court, I am afraid.
New Ration Book And Identity Card (Nurse's Application)
53.
asked the Parliamentary Secretary to the Ministry of Food whether his attention has been drawn to the case of a trained nurse, employed on a serious medical case who, applying for a new ration book at the Food Office, Woking, was informed that she must travel from Surrey to Lancashire to do so, permission to obtain it by post being refused by the same official; and whether he will direct officials in all local food offices to use their discretion and common sense when discharging their duties?
My attention has been drawn to the case in question. The registered address of the nurse is in Bolton. It has always been intended that the new ration book and identity card should in such a case as this be supplied through the post. I regret that in this instance the applicant was wrongly informed as to procedure. Arrangements for her to receive her new documents by post have now been made.
Is my hon. Friend aware that this is by no means an isolated case? Does this not constitute a grave warning against the extension after the war of a repulsive system of State control?
Harvest Workers
54.
asked the Parliamentary Secretary to the Ministry of Food whether it is proposed to allow farmers extra rations of cheese and jam for the purpose of providing meals for workers employed overtime during the harvest period?
The same allowance of rationed food as was in force last year will be made available to farmers this year for the purpose of providing meals and hot beverages for workers during the harvest period. The foods allowed are tea, sugar, margarine, cheese and preserves.
Do small farmers and their sons, who work longer hours than agricultural labourers, get the extra rations, as agricultural labourers do?
I would be glad if my hon. Friend would put that Question down. He knows that it is a somewhat complicated subject.
58.
asked the Parliamentary Secretary to the Ministry of Food whether he is aware that only tea and sugar are being allowed for extra haysel and harvest rations instead of tea, sugar, margarine, jam and cheese by the food officer of the St. Faith's and Aylsham Rural District Council, in Norfolk, on the plea that pies under the pie scheme, operating in many villages only once a week, take the place of margarine, jam and cheese; that this action is causing indignation among farm workers; and will he take steps to see that the extra rations are available for the men and women working often from 7 a.m. to 9 or 10 p.m.?
The action to which my hon. Friend refers was due to a misunderstanding. The local food executive officer has been instructed to allow farmers to obtain appropriate allowances of the other rationed foods besides tea and sugar which are available for feeding workers at harvest time.
Points Changes
55.
asked the Parliamentary Secretary to the Ministry of Food whether he will in future, when alterations have to be made in points, make them operative on a Monday, a fully recognised shopping day, instead of on a Sunday as has been the practice recently?
My Noble Friend will be prepared to consider any arguments in favour of the change proposed by my hon. Friend, but his present view is in favour of the existing arrangements.
Does my hon. Friend not realise that this gives an unfair advantage to a limited number of traders who open on Sundays and handicaps other traders who seek to observe the Sunday Trading (Restriction) Act?
The number of traders who open on Sundays is very limited, and there is a substantial advantage in making these announcements in the way we do; but I would be prepared to discuss the matter with my hon. Friend.
Restaurant Meals (House Charge)
56.
asked the Parliamentary Secretary to the Ministry of Food whether he can give an estimate of the average profit on a 5s. meal as provided in an average restaurant to which a house charge is applicable?
No, Sir.
Does not my hon. Friend realise, from such information as he may have been able to obtain, that there is well over 60 per cent, net profit on each of these meal transactions, and therefore why this discrimination and the giving of preferential treatment in the way of house charges? Does he not think it is repulsive to British public opinion?
My hon. and gallant Friend has asked me whether I can give the average profit on a 5s. meal. I cannot. The statistics are not available in the Department.
Poultry And Rabbits (Maximum Prices Orders)
57.
asked the Parliamentary Secretary to the Ministry of Food whether, in view of the widespread evasion of the Maximum Prices Orders for Poultry and Rabbits and the rejection of the proposed scheme of control, he will consider the abandonment of these price Orders, the ineffectiveness of which has brought them into contempt?
No, Sir. Whilst my Noble Friend regrets that some evasion of the Maximum Prices Orders for poultry and rabbits is taking place, he cannot agree that the proper remedy is to withdraw the Orders.
Is my hon. Friend aware that newspaper cuttings during the past six months reveal over 150 prosecutions for violating the price control Order, and that not more than 25 per cent. of the rabbits and poultry now sold are sold according to the terms of the Order?
The hon. Member knows a great deal about this subject, and he knows its difficulty. All I can say is that our motto is nil desperandum. We are hoping to get some scheme to control the sale of poultry and rabbits.
At an early date?
Milk (Pasteurisation)
59.
asked the Parliamentary Secretary to the Ministry of Food whether he is now in a position to make a statement as to the pasteurisation of milk for human consumption?
A statement will, it is is hoped, be made as part of a general statement on milk policy by my right hon. Friend the Minister of Agriculture, on behalf of His Majesty's Government, tomorrow.
Monopolistic Practices Inquiry, United States
60.
asked the Minister of Supply how many persons now in the service of his Department are officials of any, and which, firms alleged to be involved in monopolistic practices, and now the subject of investigation under the antitrust laws in the courts of America?
I think it would be misleading to publish information purporting to associate members of the staff of the Ministry of Supply with matters which are sub judice in a foreign court.
62.
asked the Minister of Supply the name of the head of the Department controlling the metal, titanium; and whether there has been any association by him or any of his staff with the British firm whose associated American company is now before the American courts in connection with alleged monopolistic practices?
There are no commercial uses of titanium metal in this country, and no control by the Ministry of Supply has been necessary.
British Celanese (New Plant)
The following Question stood upon the Order Paper in the name of Mr. BURKE:
63. To ask the Minister of Supply why authorisation was given for the erection of a building and plant for British Celanese to manufacture a substance of which he has been informed, seeing that there is already enough productive capacity in the country to manufacture this commodity and ample supplies are available?
May I ask your advice, Sir, with regard to this Question? I put it down with the name of the substance included. The Question has been altered. I would like to know whether it is right for a Question to be altered without the Member concerned being consulted about the alteration. It seems to me that the value of Question Time will be seriously impaired if we are to have the technique of the Secret Session brought in. This is a substance which is quite well known, and unless the general public and the trade know what British Celanese make, it is impossible for them to know what is going on.
I cannot answer that question. I understand that a Question was put down by the hon. Member originally, with the name of this substance. The hon. Member did agree, I understand, to the omission in the first Question, and perhaps it was thought that he agreed to the omission in the second Question as well.
No, I have had no consultation with anyone about the terms of this Question.
I had no previous knowledge that this matter was going to be raised. Perhaps if the hon. Member will see me I shall be able to help him.
After carefully reviewing requirements and all other relevant circumstances, including the location of existing capacity, I was satisfied as to the wisdom of installing the additional plant in question.
Was the authorisation for the building of this plant by British Celanese given by the right hon. Gentleman on the advice of his usual advisers, or was it given entirely off his own bat?
It was done entirely on the advice of my usual advisers.
Can the right hon. Gentleman tell us what this material is going to be used for, and will it not put British Celanese in a very privileged position when the war is over?
Most certainly not. No question of privilege to any firm enters into these matters.
Is there any reason why this substance should not be disclosed to the House? Are there any security reasons?
I was not aware up to now that there had been any discussion on the form of the Question.
Why is the policy of my right hon. Friend's Ministry in connection with this case so different from the policy of the Ministry of Aircraft Production?
Bricklaying
65.
asked the Parliamentary Secretary to the Ministry of Works the comparable prices for laying Loop bricks on a 14-inch wall, pointed one side, in 1938 and 1943?
I regret that I am unable to give the comparative figures asked for by the hon. Member, as accurate information is not available as to the prices for this work in 1938.
Can my hon. Friend give us the 1939 price?
That is not on the Order Paper.
Is there any information which the hon. Gentleman can give the House?
I can assure the hon. Member that there is plenty of information I can give him; I can give him up to date information, but not information about 1938.
If I put the Question down again, will the hon. Gentleman search for these figures and let us have them?
There is such variety in the Question, in regard to location, organisation, the type of building and so on, that it is simply impossible to give an accurate answer, as the hon. Member knows very well.
I asked for comparable figures, under conditions which were appropriately the same at that time and to-day, now, and figures are available.
Is not the hon. Gentleman's reluctance to supply information similar to that of other Ministries?
Is there any reason why the Minister is not giving this information?
Divorce Cases (Expedition)
66.
asked the Attorney-General what steps are being taken to expedite the hearing of cases in the Probate, Divorce and Admiralty Division of the High Court of Justice?
The hon. Member's Question must, I think, refer mainly to the state of the Divorce Lists; there is no delay in hearing Admiralty cases as soon as the patties are available, when a suitable day can be fixed. The Lord Chancellor is fully alive to the difficulty of disposing of divorce cases as expeditiously as could be wished. My noble Friend set up a Committee some time ago to consider certain aspects of this question, and he expects to receive the Report shortly. Meanwhile, the steps taken by the President of the Division to expedite the hearing of as many divorce cases as possible include special arrangements for the hearing of divorce cases where at least one party is in the Forces; the separation of the list of causes likely to take a long time to hear from the list of those likely to take a short time; the granting of applications to expedite particular cases on special grounds; and the arranging for sittings during the Vacation.
Is it not true that if some cases are expedited, other cases are so much the more delayed?
I quite agree. As I said, we agree with my hon. Friend's point, but my Noble Friend is anxious to get the Report of this Committee before coming to a conclusion as to the best remedy.
How many cases are in arrear, and how long will they take?
I cannot give that information without notice. The delay is, in the main, in the long defended cases.
What is the cause of all these divorce cases?
67.
asked the Attorney-General whether, having regard to the many men and women serving in His Majesty's Forces who are concerned, he will take steps to reduce the interval between decree nisi and decree absolute in divorce from six months to three months?
It is always open to a petitioner to ask the Judge that the decree absolute should be expedited, and if the Judge accedes any necessary enquiries by the King's Proctor are also expedited. This practice is frequently followed in Service cases, and I do not think that it would be in the public interest to reduce the period of six months applicable under the Statute where no such application is made or granted.
Is not the right hon. and learned Gentleman aware that in order to expedite these cases very heavy fees have to be paid to the King's Proctor and that it is very unfair to those who are not well off?
No, Sir, I was not aware of that, and I will look into it.
Petrol Allowances (High Powered Cars)
68.
asked the Minister of Fuel and Power whether, before he makes large petrol allowances to civilians engaged in industry, he will ensure that it will not be used in high horse-power motor-cars unless there are valid reasons for it being so used?
The scale of allowances introduced a few months ago discriminates severely against the use of high-powered cars except where this is shown to be necessary. The indications are that this is having the desired effect.
Is it not true that Ministers have been known to roll around in very high-powered cars?
No doubt for a very good reason.
Will the right hon. Gentleman take steps to reduce the power of the cars used by the Corps Diplomatique?
Household Linen (Coupons)
69.
asked the President of the Board of Trade whether he is aware of the hardship being experienced by those who have to purchase necessary household linen because they have to surrender coupons which are issued for buying personal clothing; and will he have issued separate coupons to be used when these household requirements must be purchased?
would refer my hon. Friend to the reply which was given to similar Questions on this subject on 26th January, of which I am sending him a copy.
Children's Clothes And Industrial Overalls
70.
asked the President of the Board of Trade whether he will take steps to increase the supply of children's clothes and industrial overalls; and whether he will arrange for manufacturers to retain a sufficient number of their work-people to enable them to use the material allotted to them?
My right hon. Friend realises the importance of maintaining adequate supplies of children's clothes and industrial overalls, and the necessary steps have been taken to reserve sufficient labour to produce them. As regards the second part of the Question, my right hon. Friends the Minister of Production and the Minister of Labour and National Service have asked for special releases of labour from clothing firms in a few specially important centres of war industry, and the Board of Trade are therefore unable to protect the labour of individual clothing manufacturers in these areas. The Board's officers do their best to help such manufacturers to arrange for their products to be made for them by firms in easier labour areas.
Will my hon. and gallant Friend give sympathetic consideration to the case I am sending him where a firm of manufacturers is being pressed to have its employees reduced from 500 to 12?
I understand that that particular case is now being investigated by officials of the Ministry of Labour, who are seeing the firm in a day or two.
Milk Distribution (Costs)
71.
asked the Chancellor of the Exchequer whether he can give the total cost to the Treasury of distributing milk during the periods 1st October, 1941, to 31st March, 1942, and 1st October, 1942, to 31st March, 1943?
Milk is subsidised, and the difference between the prices paid to producers plus cost of distribution and retail prices is met out of the Exchequer. It is not possible to apportion the cost to the Exchequer between the expenses of production and distribution.
Government Departments (Forms And Returns)
72.
asked the Financial Secretary to the Treasury whether he is aware of the increasing demands that are being made on industry and agriculture to supply statistical data and of the manpower which is being absorbed in making these returns; and whether he will give instructions to all Departments considerably to limit their demand for information?
It is the aim of Government Departments to restrict these returns as much as possible. If my hon. Friend has any particular case in mind, I would suggest that he should bring it to the notice of the responsible Minister.
Is the Financial Secretary aware that it takes 20 per cent. of the time of the staff of an industry concerned to fill in these forms? The Minister says he is endeavouring to decrease the number of forms, but I can assure him they are increasing, and will he take some action in the matter?
I hope my hon. Friend will draw the attention of the appropriate Minister to the matter.
Is the Financial Secretary aware that many forms of this sort issued by the Ministry of Labour are such that it is quite impossible to fill them up with any information to be of any use to any mortal soul?.
Will the hon. Gentleman seriously consider sending a representative from his Department to any engineering works he likes to choose, just to examine the number of forms that have to be filled in daily before business can be done, and so see for himself?
I do not think that that would be part of the duty of the Treasury.
Is it not a wasteful use of paper?
Is the Financial Secretary aware that the returns of the Ministry of Labour alone necessitate 773 headings every three months and, in addition to that, weekly returns?
Perhaps my hon. Friend would make representations to the Ministry of Labour.
Business Of The House
I want to ask the Leader of the House whether he will give us a little information about Business. Yesterday he announced that the Coal Bill would come before the House to-day. On getting the Bill to-day I find that it comes from the House of Lords, and I want to ask whether the House of Lords has taken the position of passing down important Bills to us. Have they the authority from the Government to do this? It seems to me that some explanation is required.
Sir Irving Albery.
On a point of Order. Am I not to be allowed to have an answer? I think we are entitled to some explanation on a matter of this kind, although, if I am out of Order, perhaps you will tell me, Mr. Speaker.
Perhaps I can tell the hon. Gentleman that the procedure which has been followed in this respect is perfectly normal. It was purely a Business arrangement. It so happens that it was more convenient to introduce that particular Bill in another place because they were short of Business, and we have plenty. It is the ordinary Parliamentary practice that Bills have to go through both Houses of Parliament. Perhaps it may be a comfort to the hon. Gentleman if I tell him that, so far as I have been able to ascertain from the record, only one speech was made in the other place, and that was by the Government spokesman. I hope we shall be equally successful when the Bill comes before us.
With reference to the Motion tabled by the Prime Minister and other Ministers with regard to the Emergency Powers (Defence) Act, 1939, and its continuation, is it proposed to take that at an early date?
[That an humble Address be presented to His Majesty in pursuance of Subsection (1) of Section eleven of the Emergency Powers ( Defence) Act, 1939, praying that the said Act, as amended by any subsequent enactment, be continued in force for a further period of one year, beginning with the twenty-fourth day of August, nineteen hundred and forty-three.]
Yes, Sir. I hope it will be possible to take it during our next series of Sittings. Time will be allotted for it then.
Then my hon. Friends and myself, under those circumstances, would not propose to proceed with their opposition to the Second Reading of the Emergency Powers (Isle of Man Defence) Bill.
Will ample time be allotted for the Debate on the Emergency Regulations?
I do not think that the definition of amplitude lies with me; it is exempted Business.
Yesterday the Leader of the House said he would make a statement shortly on the question of pensions. I noticed to-day in the Press——
We are discussing the Business for to-day; Business questions can be put on our next Sitting Day.
Perhaps you will allow me to finish the point I was trying to make, Mr. Speaker. Yesterday the Leader of the House said he intended to make a statement on pensions. The Press is out to-day with all sorts of information—and I think fairly well-informed information—and I was intending to raise with the right hon. Gentleman not a question of Business but the fact that he said he would make a statement. It is no use hiding the fact that the Press are very well informed, but I think that the promised statement should either be expedited or that the House of Commons should be treated to such statements first.
Of course, the hon. Gentleman will not expect me to say whether the Press reports were accurate or not. I can only say that I regret speculation, although no doubt in a case of this kind it is well nigh inevitable. It is, however, the intention of the Government to make a statement as soon as possible—I hope during our next series of Sittings—so perhaps it would be well not to forecast any action until then.
Will my right hon. Friend give consideration to this point? There is a growing habit on the part of the public relations officers of the different Ministries to go to the Press and give them information in a definite way before it is given in this House. Will he approach the Prime Minister and ask that this most undesirable practice should be abandoned?
I am prepared to consider that, but I do not think it can be assumed that that practice was followed in this instance. I do not think it was.
Can the right hon. Gentleman say whether it was?
I have just said that I do not think it was; so far as I am aware, it was not.
Will the right hon. Gentleman inquire?
King Of The Hellenes (Broadcast To Greek People)
I would ask the leave of the House to make a brief statement. On Sunday last, His Majesty the King of the Hellenes broadcast to the Greek people an important statement, regarding the aims and intentions of himself and his Government, both during the war and in the period immediately following the liberation of Greece. I will be grateful if the House will allow me to say how much His Majesty's Government welcome, and how sincerely they endorse, this far-sighted announcement by the King of Greece, which, in their view, provides for the constitutional evolution of Greek political institutions in accordance with the principles of democracy and of the Atlantic Charter. They are convinced that this statement will make an important contribution, both to the Greek war effort and to the happiness and prosperity of the whole Greek people when their freedom is regained.
Will the right hon. Gentleman take steps to see that the same principle of democratic selection is extended to the French Committee in Algiers?
Civil Estimates (Excess, 1941)
Statement presented,—of the Sum required to be voted to make good an Excess on the grant for the Ministry of Supply for the year ended 31st March, 1942, [by Command]; referred to the Committee of Supply and to be printed.
Civil Estimates (Supplementary Estimate, 1943)
Estimate presented,—of the further Sum required to be voted for the service of the year ending on 31st March, 1944, [by Command]; referred to the Committee of Supply and to be printed. [No. 98.]
Business Of The House
Ordered,
"That the Proceedings on Government Business be exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House)."—[Mr. Eden.]
Orders Of The Day
Finance Bill
Order for Third Reading read.
I beg to move, "That the Bill be now read the Third time."
It is nearly three months since my right hon. Friend the Chancellor of the Exchequer introduced his Budget, and today we hope to reach the end of this particular journey. There are those, I know, who say that it is better to travel pleasantly than to arrive. [HON. MEMBERS: "Travel hopefully."] Hopefully and pleasantly, too. This is hardly a method which we can deliberately apply to a Finance Bill; however, it has turned out, that not only have we reached the end of the journey, but that, on this occasion at any rate, it has been, on the whole, a pleasant journey. It has been a pleasant one, thanks to the wisdom of my right hon. Friend's proposals, and also to the great good will and sense of responsibility of this House. Although the Finance Bill incorporates proposals which impose upon the people of this country financial burdens greater than they have ever yet been called upon to bear, none the less those burdens have been accepted readily and cheerfully, because it is appreciated that they are not only necessary to enable us to carry on the war to the fullest possible extent, but also that they are generally thought in themselves to be just. Looking at the Bill itself and the various taxes and duties imposed in it, one is bound to comment on the very high rate of taxation involved. Inland Revenue taxes are estimated to yield in this year nearly £1,900,000,000, and the Customs, Excise and Motor Vehicles Duties are to provide another £1,000,000,000. Our predecessors in this House at any time before the last war, or even during the last war, would, I am sure, have rubbed their eyes at some of the Clauses in this Bill. Let us look first at the Income Tax. When my right hon. Friend the Prime Minister was born and Disraeli was Prime Minister, the Income Tax was 2d. in the £. When my right hon. Friend the Chancellor of the Exchequer was born and Gladstone was Prime Minister, it was 6d. in the £. The highest rate to which Income Tax went as a result of the last war was 6s. in the £, and now we are supporting a rate, for the time being, of 10s. in the £ with all the sacrifices which that rate of tax implies. Before the last war the highest level of Surtax was 6d.; it is now 9s. 6d. Before the last war, the duty on beer was one-third of a penny a pint; it is now 7¼d. a pint.Would the hon. Gentleman give us some comparison of incomes in those periods? What I want to get at is whether the man who is now paying that 9s. 6d. has not still got a bigger income than the fellow who is paying the lower rate?
If my hon. Friend wants to go into that question, he will find a most interesting set of tables in the Report of the Board of Inland Revenue, to which I would refer him. It may well be asked how it is that Parliament, whose very origin is so intimately bound up with the duty of checking expenditure by the Executive, and whose whole history for many hundreds of years has been that of a struggle to protect the taxpayer from the Crown, should be prepared to approve of such enormous burdens of taxation. The answer, of course, is perfectly clear. It is that we are prepared to accept any sacrifices and burdens which are necessary to win the war and to preserve freedom in the world.
In spite of the great revenue which we are obtaining, we have vastly increased the National Debt since the war began, and it now stands at the enormous figure of £17,700,000,000. It is interesting to note that we are borrowing as much money every eight weeks now as was borrowed during the whole period of the Napoleonic wars, and that the National Debt, at the end of the wars conducted by the great Duke of Marlborough, had reached a figure of something like £53,000,000, a sum which we shall spend between now and the end of this week. The upheaval in our national finances caused by the war could not, of course, fail to raise serious economic and social issues, and Budgetary problems have therefore taken on an entirely new aspect. Considerations of economic stability, as well as considerations of revenue, have to be taken carefully into account, but, as my right hon. Friend will probably deal with some of those considerations later, I propose to confine myself to some of the purely financial aspects in the taxation Clauses and in Clause 29, which is the Debt Clause of this Bill The taxation question and the Debt question hang very closely together. One of the principal objects of high taxation is to minimise the burden of the Debt after the war. In his speech on the Second Reading of the Bill my right hon. Friend emphasised the fact that whatever some optimists may say, the post-war cost of the Debt must be taken seriously, for that cost will have to be raised by taxation, in one way or another, and the more revenue is required for the service of the Debt, the less easy will it be to find revenue for those many desirable developments which we are anxious to see after the war.What about Beveridge now?
The difference between a reasonable level of taxation and an oppressive level can certainly make or mar business enterprise, and it would equally make a great deal of difference to social arid industrial contentment. If the public readily accepts these burdens, it can properly expect the Government to play their part in borrowing both as cheaply and as soundly as possible. As the House knows, the average cost of our war borrowings up to date has been 2 per cent. We have, however, not merely been able to borrow at a low rate of interest, but what is just as important is that we have not had to have excessive recourse to the Floating Debt. Of the total National Debt of £17,700,000,000, the Floating Debt at present is somewhat over £4,000,000,000, but it is important to bear in mind that nearly half the Floating Debt represents the investment of official funds, and this makes the position of the Government less vulnerable than it would be if the whole of the Floating Debt was in the hands of the public. Clause 29 of the Bill provides £375,000,000 for the Debt charge. Of the total loans raised from different sources during the war and up to the end of June last, it is interesting to make the following analysis. Small savings have provided 22 per cent., subscriptions from non-official sources to longer-term loans 34 per cent., short-term borrowing from the money market and banks 22 per cent., extra-Budgetry funds 8 per cent., Tax Reserve Certificates 5 per cent., and other sources 9 per cent. Those figures show a very satisfactory proportion of loans raised from the general public, and, if we are to keep the Floating Debt within reasonable bounds, it is essential that we should get the highest possible yield from savings and the other sources from which we get these loans.
Will the hon. Gentleman tell the House what these non-official sources are which supply 34 per cent.?
The non-official sources which subscribe money to these loans are very numerous—insurance companies and many other bodies. If the hon. Member wants further details of the analysis, no doubt I shall be able to provide him with some figures in due course, but for the purposes of this analysis to-day I naturally want it to be in such a form as will be easily understood. The maturities of our various longer-term loans have been arranged with great care and forethought, and we shall try to avoid again finding ourselves with one big maturity, such as the old War Loan of the last war which the State might be called upon to repay in any one year.
I am glad to say that in the "Wings for Victory" weeks so far held, the proportion of small savers is higher than in the corresponding "Warships" weeks of last year. Also during the first six months of this year the total of small savings is something like 25 per cent. higher than in the same period of 1942. Moreover, the proportion of the total value of Saving Certificates sold in the smallest units is steadily rising. These are very creditable results, and they are a striking tribute to the sacrifice of the saving population and to the devotion of that very large army of unpaid War Savings workers. As time passes, we hope for even greater contributions from these sources, which should be possible with the increased amount of purchasing power in the hands of the people. Great as are the burdens shared by all taxpayers, savings represent an additional sacrifice borne by individual citizens in the exercise of their free will. The more we value the greater freedoms which we are fighting for, the more ready should we be to dedicate to the war effort those lesser freedoms, like the freedom to work hard and the freedom to do without non-essentials and to save. This Finance Bill will cover our finances up to and beyond the fourth year of the war. There is no reason why they should not remain as satisfactory in the fifth and, if necessary, in further years of war, provided our people continue to be ready to make the sacrifices they are now making. We can be confident that they will, for they realise that the maintenance of sound finance is not only vital to victory but will also be of inestimable value when we are face to face with new problems in the early years after the war. I think we should all agree that finance, like fire and water, is a good servant but a bad master. But we must also remember that, if a good servant is to do his best for us, he must be treated with respect. We may each of us, here, have our own design for living after the war, and we may each shape our design for budgeting accordingly. Some want this new order, and others want that. There may be some who have hankerings after some part of the old order, and there are others, like the hon. Member for Bridgeton (Mr. Maxton), who would probably prefer in their heart of hearts to have no order at all. [Interruption.] He never made much secret of his views. Whatever our favourite design, we each want to carry it out in circumstances which will give it the best chance of success. The foundation of such success is that we should start the post-war years in a sound economic and financial position. This Finance Bill is a sound one, and I beg to move its Third Reading.I propose to commence my remarks by handing out bouquets. The first I wish to hand out is to the British taxpayers, who as a class uncomplainingly are facing the heavy burdens which the Chancellor of the Exchequer has imposed upon them. Not only so, but, as the Financial Secretary has told us, a large number of the taxpayers have between them put by considerable savings and lent them to the Chancellor of the Exchequer. The hon. Gentleman has given us some figures showing the extent of those savings in the present year. I should be glad if we could be told how far, during the last three months let us say, small savings are greater than for the similar period last year. I shall also be grateful if the Chancellor sees fit to enlarge a little on the question of closing the gap. In previous years we have closed the gap for all but a very small space, and I am wondering how far the increased savings of the current year will suffice to close the gap entirely. One thing one ought to say before passing from the question of the small saver is that, while the total is surprisingly good, and while the individual effort of those who are saving is very great, there are still, I think, a number of people who could save and do not, and, if they were to come into line with the others, our figures would be still better than they are.
The second bouquet that I want to hand out is to the people and the Government of our great Dominion of Canada, who, by their great and unprecedented generosity, have made such a substantial reduction in the total outlay of the United Kingdom. I am sure I am only expressing the opinion of every part of the House when I render that great tribute to a fine and generous people. The third bouquet I want to present is to the people at the United States, who have undoubtedly made great sacrifices in order to send supplies to ourselves. I do not know how far the House realises what tremendous sacrifices they have made in the limitation of gasoline alone. The United States depend far more on private motor transport than we do in this country, and in order that the tankers might be available for supplying the war needs of this country the Americans have made a complete change in their whole method of life. I consider that on that ground, if for no other, it is right that we should pay them the homage of our thanks and respect. Finally, I should like to say a good word for our present right hon. friend the Chancellor of the Exchequer and his most able Financial Secretary, to whose speech we have just listened with interest and attention. I pay him that compliment not merely for the friendly way in which he has conducted the proceedings on this Bill through its various stages, but because we recognise that though he has a firm intention, which he puts into definite effect, to raise these enormous sums from the pockets of the British taxpayer, he is willing to listen, and not infrequently to make concessions, when it is represented to him that the shoe pinches very hard on certain people. The House has secured such concessions as the Chancellor has felt able to make, both on direct taxation in the shape of allowances and in the matter of the Purchase Tax. It would be fulsome to say that all our criticisms have been met; they have not, and no one is more aware of that than the Chancellor himself. I know and he knows that there are many people who are having great difficulties in meeting their burdens, particularly those who are going on in years, who are in straitened circumstances and who suffer great hardship owing to the amount and sometimes owing to the time of collection of the Income Tax. At the present time, when the rate of Income Tax is very high, these are solid grievances. I ask the Chancellor to say, without making any specific promises, that he will give careful and, indeed, sympathetic and human consideration to whatever may be represented to him between now and the formulation of his next Budget. I pass to a somewhat different subject, the question of "pay-as-you-go." I believe that with the lapse of time it is being brought home more and more to all sections, to those who have to pay, to Members of this House who represent them here, to the Inland Revenue, to the Treasury itself and, of course, to the Chancellor and the Financial Secretary that it will be necessary in the end, in spite of the difficulties, to bring forward some proposal of this kind. The present Finance Bill continues the existing system of taxation in arrear, and we cannot carry the discussion on the matter much further today. The Chancellor promised on one occasion to put in the Library some account of the discussions that were held in the Congress of the United States, but up to the present I understand that this has not materialised. Can he tell us when he hopes to be in a position to supply that paper and whether it is likely to be before the summer Recess; and also whether he thinks it will be possible some time later, probably not before the autumn, to have a Debate when this question can be threshed out in all its details? I am particularly anxious, and I believe it is the wish of the House, that he should not close his mind on this matter. If he cannot at this stage give a positive assurance of progress, I hope that he will not say anything which will show that his mind is closed and that he will not consider the situation when it is presented to him. The third matter to which I wish to draw attention are the Clauses in the Bill dealing with tax avoidance. The House supported with keen interest the proposal of the Chancellor to deal with the particular tax dodging referred to in those Clauses, and with, I think, one exception the House willingly supported the retrospective provision which the Chancellor found it necessary to make. None of us likes retrospective legislation, but we are all agreed that in many cases of tax dodging it is necessary, and we are prepared to sustain the Chancellor when he comes to that decision. We all know that the tax dodger generally gets one move in front of the Chancellor, and sometimes more than one, and that he does so when he is supported and advised by unscrupulous persons who have professional knowledge which they place at his disposal. I said on the Report stage that I believed the time might be coming when the Chancellor might, after full investigation of the matter, come to the conclusion that it was necessary to take the further step of a more fundamental alteration of the law. I would like to repeat that if the Chancellor comes to the House and tells us that in his opinion the time is ripe and it is necessary to have some such further steps, I believe he will have the support of the overwhelming majority of the House. When I made a reference to this on the Report stage my hon. Friend the Member for Chesterfield (Mr. Benson) was under a slight misapprehension of what I had in mind, and I want therefore to explain what my view is. I suggested then that there might be a slight extension of the definition of fraud to cover cases where a purely bogus façade was set up in order to escape tax. I made that suggestion, not with a view to bringing the criminal law to bear on such persons, but to enable a proper interpretation of the financial facts to be made. My desire was that the authorities should have the power to tear down any purely bogus, artificial façade and to expose the true facts which lay behind. It has been said that all of us have a perfect right so to arrange our affairs that we do not pay more tax than is necessary. I think that we can all subscribe to that view, but that is entirely a different matter from allowing persons to set up a purely artificial procedure which can be shown beyond a peradventure to be designed solely for the purpose of tax dodging. The House will be quite willing, if the Chancellor shows good cause, to change the law so as to give him further power. I want to ask the Chancellor a final question arising out of our financial position. A few weeks ago we had a preliminary Debate on post-war currency and exchange, when what is known as the Keynes plan was under discussion. It would not be proper for me, even if it were in Order, to go in any detail into that question to-day, but on that occasion the Chancellor promised that a further opportunity would be provided to the House for discussing the matter before it was finally settled and crystallised by international agreement. I only want to ask him to assure us that he has not forgotten his promise and to say whether he can give any indication of how soon he thinks the time will be ripe for that further Debate before anything definite is done which will commit this country and this House. With these remarks I propose to support, as I am sure the House will, the Third Reading of the Bill.My hon. Friend the Financial Secretary to the Treasury in his closing observations said that the Finance Bill had on the whole had a pleasant journey. I am not sure that the word "pleasant" is the best one to use in this connection. At all events, it may be said that the Bill has had a much easier passage than anybody would have thought possible a few years ago. If that is so, it is due to the fact that there has emerged in our economic life a series of events which indicate a very different outlook and standard of conduct. I am entirely in agreement with what my right hon. Friend the Member for East Edinburgh (Mr. Pethick-Lawrence) said about the help we have received from the Canadian Government. It is without parallel, and the Canadian Government and their people have been extraordinarily modest about it. When one takes that into account, together with the marvellous war effort of Canada as a whole in their production of shipping and the like it is a remarkable testimony to the value of the British way of life that the Dominions of their own free will should take action of that kind. I am not certain whether the journey of the Finance Bill would not have been much less pleasant had it not been for Lend-Lease. That again is a matter which set a new standard of outlook altogether. I am glad to know that it is no longer a one-way traffic but that the contribution of Great Britain and the Dominions is constantly on the increase. It is a new conception which, with a farseeing vision, will avoid the bickering and retaliation which went on after the last war. My hon. Friend also referred to the attitude of the taxpayer. It is almost miraculous when we think that in 1939 the amount paid out to the equity shareholders in British industry, out of a gross total of £47,750,000 amounted to £36,500,000, and that by 1940 out of a reduced total of £43,000,000 they received £21,500,000, and that without any serious complaint at all. It does indicate a sense of financial responsibility which is a favourable augury for our future affairs.
There is one aspect of our affairs which certainly is not nearly so pleasant to contemplate. In connection with every Finance Bill of recent years the Chancellor of the Exchequer, the Board of Inland Revenue and Parliament have had to devote time, labour and ingenuity to attempting to defeat the misplaced ingenuity of those gentry, who were referred to a few moments ago by my right hon. Friend, who seek to evade obligations which the rest of the community accept quite loyally. It is an outrage that the time of Parliament should have to be devoted to affairs of this kind, and I sincerely hope that the publicity which has been given to these transactions will ensure that next year for the first time we may have a Finance Bill which is free from these special Clauses. Such transactions are a slur upon the honour and the commercial integrity of this country. The people who are engaged in them should remember that robbery is no less robbery and an offence against the community even when it is possible to bring it within the ambit of a somewhat doubtful legality.
Is my hon. Friend arguing that a law should be interpreted in the spirit and not in the letter of the law, and that the law should be changed accordingly?
No, I do not suggest that. The law has been changed; we have made a great many changes in this very Bill. I think the time of the Treasury is far too much occupied as a result of a general obscurity in the presentation of accounts. Accounts are often presented in such a manner that they conceal from the Revenue authorities information to which they are entitled, and also conceal from the proprietors of business information which it would be to their benefit to know. That is a matter which should not be dealt with in a Finance Bill, but by a reform of the company laws, and I am glad to know that the President of the Board of Trade has appointed a Committee which will take these matters into account.
There are two other matters to which I should like to refer briefly. They are two milestones on the journey of the Finance Bill in this year. One is the increasing realisation in the House of the importance of finance as an instrument for the direction of industrial policy and economic policy after the war. I was very much interested, as indeed was the whole House, in the important Amendment, which was not moved, which stood on the Order Paper in the name of my hon. Friend the Member for Chesterfield (Mr. Benson), supported by my hon. Friend the Member for Walsall (Sir G. Schuster) and others. I have always taken the view—I have said this before, and I repeat it—that provided the means of production were not broken in our hands by enemy action and that our financial affairs were conducted on their present basis, we should be able to carry on and build up our economic life for ourselves after the war. I believe that still. I do not think there is anything in the present position of our finances which raises an insuperable difficulty for us after the war, but we must bear in mind that there are more ways of destroying the means of production than by enemy action, and grave doubts have arisen in the minds of many competent observers whether the high level of taxation, and more especially the incidence of Excess Profits Tax, is not so depleting the re sources of industry that when the war comes to an end we shall find ourselves very seriously handicapped with much business which depended upon international relationships taken away from us. Therefore I am very glad indeed that the Chancellor of the Exchequer has promised that he will set up a committee to examine the incidence of this taxation, and that that examination will be conducted on the widest possible basis, so that the House may know what are its economic effects. We do wish to be sure that we are not doing ourselves more harm than good by our financial arrangements. We shall look forward to hearing the result of the inquiry, and if we are here again this time 12 months, we may be able to give further consideration to the practical points put before us. The other point which I think is of very great importance and which has already cast its shadow before is one which has already been referred to by my right hon. Friend the Member for East Edinburgh, namely, the difficulties which are going to arise at the end of the war, or even before in a period of fluctuating employment, from the present method of collecting Income Tax. There are more than 12,500,000 direct taxpayers, and one is apprehensive of the difficulties, discomforts and dangers which will arise after the war if we are not successful in devising some method of "pay-as-you-go." It does not require a great deal of imagination to see what extraordinary difficulties may arise, and they will not be confined to this country. The Government of the United States and the Government of Canada are in virtually the same difficulty. One must hope that the Chancellor will be able to produce a plan which will prevent the discomforts and the disorganisation which are already beginning to appears in the case of some of those who have come out of the Forces or who are unable to continue their employment through sickness and find themselves with a millstone of arrears of Income Tax round their necks, and unable to pay. It is a matter the importance of which it is difficult to exaggerate from the point of view of public morale after the war, and I am glad that it is receiving the active consideration of my right hon. Friend. In conclusion, I repeat that I see no reason why we should not be able to work unimpeded by financial difficulties to any great extent after the war, provided that we turn our backs for all time upon the short-sighted and cowardly policy of restrictions which prevailed between the war, and provided also that we dismiss from our minds and from our practice that mixture of loose thinking and good intentions which has governed too much of our finance in the past and has brought us to the pass in which we find ourselves to-day. Finally, if we realise once and for all that the interdependence of nations is now far more important than their independence, and that in future we shall have no more foreign affairs, because all our affairs will be foreign affairs, and if we realise that prosperity, like peace, is indivisible and handle the financial resources which remain to us with courage and with imagination, there is no reason why we should not regard the future with calm.I was struck by one quotation made by my hon. Friend the Financial Secretary to the Treasury, that it is better to travel pleasantly than to arrive. I believe the correct expression is that it is better to travel hopefully than to arrive. Pleasant as the journey may have been to the Treasury, it has been more of a hopeful one for the rest of us who have been travelling, but I think some of us, although we have not languished by the way, have not yet arrived at our ultimate destination, and must continue to press for certain further concessions between now and the next Budget, and seek to gain the ear of the Chancellor, as we shall do if we have any reasonable proposals to put forward. I should like to re-echo what has been said about the great debt of gratitude we owe to the Canadian people. It is true that they have made light of what they have done. I dare say that some hon. Members, like myself, were courteously sent copies of the Canadian Parliament Hansard in which a Financial Debate was reported and in which reference was made to the gratitude expressed to Canada by Members of this House. But their contribution was brushed aside as relatively a small contribution to the united efforts of the Empire. I think we cannot look upon it as such. As has been said, it is an example of totally unprecedented generosity on the part of a Dominion to the Mother Country.
The method of "pay-as-you-go" in relation to the Income Tax liabilities of workers has been referred to, and I would put this definite question to the Chancellor, in the hope that he will answer it when he replies. Does he intend in the course of the present year to endeavour to reach a concrete plan which can be submitted to the House for approval when next Budget day arrives? We none of us know when this war may end. It may suddenly collapse, as the last war did, and we all hope it may, but in any case it is a contingency that prudence should provide for, and the House should have before it the Treasury's proposals to meet this problem of "pay-as-you-go," because sooner or later, there is no question about it, the problem will have to be met. The next point, to which I would like to know that the Treasury is giving some attention, is the question of a double Budget. We all have our own ideas of the shape of the new world, as it is called, but probably if six of us met together we should get six different opinions. Yet if the aspirations of many of us are to be realised, we cannot go on treating the finances of this country on the same Budgetary basis as we have done in all these bygone years. We are up against an entirely new set of circumstances, and new financial methods will have to be devised to deal with them. I hope that we shall hear that some very capable minds are being applied to this problem. I would like, if it were practicable, for some form of White Paper to be issued at no distant date so that we could have an opportunity to consider these matters for ourselves. Perhaps we might also have a Debate upon them, and the Government might thereby ascertain the views of Members of this House. I would next reiterate the plea I have submitted before, that further consideration should be given by the Chancellor to the position of people earning small, fixed incomes. The right hon. Gentleman who followed the Financial Secretary to-day referred to the classes who find life extremely hard and the task of meeting their tax liabilities almost impossible in these times, because they have not the opportunities possessed by other sections of adding to their incomes in time of war. I hope that further consideration will be given to their hard lot between now and the next Budget. A word as to the 20 per cent. refund of the Excess Profits Tax. The Chancellor has made it clear that, in certain conditions, the refund will take place, but he still leaves the date of the refund an entirely open question. I see that a writer in the "Investors' Chronicle" said:This is the writer's comment:"On the question of the date of repayment, I feel that it is impossible at present to fix a precise date.' Thus the Chancellor, in a written communication. 'It will depend upon the duration of the war and the duration of E.P.T.'"
The suggestion made is that the greater part of -le mistrust could be removed for good"This 'Dear-Mother,-I-am-sending-you-7s. 6d.,-but-not-this-week' attitude is disturbing industry, and, in spite of the Chancellor's earlier reassurances, is causing widespread mistrust of the Government's intentions, which we cannot believe to be a good thing."
I would ask the Treasury to reflect upon those suggestions. I come to my last point. The Chancellor, his technical advisers and the country are to be thoroughly congratulated upon the fact that we are financing the immense cost of this war on so cheap a basis. It is not only a tremendous advantage to us now and will be to those who come after us, that 2 per cent. has enabled sufficient funds to be raised to carry the financial burden of the war, but it is also of most vital importance to carry forward into the postwar reconstruction period the same policy of cheap money. That can be secured only so long as confidence prevails, which depends upon the Government of the day, whatever their texture may be, carrying out a policy which commands the general support of the country and does not risk undermining the sound basis of our prosperity in the past, and our hopes for the future."by a really firm undertaking to pay the refunds, if necessary subject to specific conditions on a future appointed day—a very different matter from the present nebulous promise 'to ascertain and record.'"
Before I come to the very few remarks that I propose to make, I should like to say how much I appreciated the very clear statement that the Financial Secretary gave us to-day. There is just one comment on it that I would like to make. He gave interesting comparisons between our expenditure to-day and the expenditure in the time of the Napoleonic wars and the wars of the Duke of Marlborough. I may perhaps comment that the symbols by which our expenditure is measured, although not meaningless, have very much changed their meaning since those earlier days and that we have to take that change into account.
Passing from that, I should like to echo the right hon. Gentleman the Member for East Edinburgh (Mr. Pethick-Lawrence) who started, as he said, by handing out bouquets. I am very glad that he put high on his list for a bouquet the Dominion of Canada. I agree with him that not enough has been said on that subject. I would also like to join him in expressing my great appreciation to the Chancellor of the Exchequer for the way in which he has handled many matters which have come up for discussion while the Bill has been going through. I should also like to attach to that a special word of appreciation for our new Financial Secretary to the Treasury, who has met some of us on several occasions and whose sincerity and sympathy have certainly made the discussion of these matters much more satisfactory than they often are. We all appreciate that very much, but I myself am particularly grateful for the promise that has been given of an inquiry into the broader aspects of the effects of taxation as at present levied. I look forward to the future value of this inquiry. And in saying that, I want to underline the point that those of us who have asked for it, and elicited that promise, take that promise very seriously and hope for very interesting results. I know that one has to be careful on this occasion to stick to the Finance Bill that is before us, but the Financial Secretary did call attention to the fact that we are now reaching the stage when, in handling our finances, we have to take account of what should be done in order that we may end the war in a sound financial position. Nowadays we are being given chances to judge of what the financial position is and is likely to be such as were never given to the House before. I refer to the White Papers, and the point I want to make is that I could myself have formed a better judgment on this occasion if certain other particulars had been added. Therefore I want to suggest to the Financial Secretary to the Treasury that in future certain particulars should be added. A statement of the capital assets which have been financed by Government during the course of the war would be extremely valuable if it could be given to us at some stage or other. Further, if we are to judge of the soundness of our national financial position we require to have also an estimate of the capital requirements of the nation as a whole, and of what capital resources are available to meet them in private hands, and otherwise. In view of what the Chancellor himself has said on the matter we are really justified in asking for an estimate of the money which is to be allowed back to industry for specific purposes under the E.P.T. refund, for information in fact which will enable us to judge what that is likely to amount to and in what directions it will flow. The question of the direction in which it will flow is particularly important in view of the Chancellor's suggestion that reliance can be placed on this refund as a very valuable and even adequate reserve for the re-equipment of our industries after the war. Then in one of the earlier Debates the Chancellor told us that he was making arrangements for a better national statistical system and I wish to ask for particulars as early as possible of what is being done in that direction. And that brings me to the next point I have to make, which concerns the general attitude to taxation. I want to repeat a point which has already been made in earlier Debates that at present levels of rates and taxes, the significance of taxation has totally changed. As a result the responsibility of the Treasury in handling taxation policy as well as the interest of the Treasury, have also changed. The Chancellor of the Exchequer, as I pointed out the other day, has become, quite apart from Surtax and E.P.T. and all his other interests—a 50 per cent. shareholder in every industrial undertaking in this country. Therefore, as I have put it, he has reached the stage where his shareholder interest is more important than his tax-gatherer interest. That has a real significance. When Income Tax is on a low level; the Chancellor can always get a bit more money by putting up the rate, but when Income Tax has reached its present level he can get more money only by making industry more fruitful. It is in fact only if industry itself can be made more fruitful that he can increase his revenue. In making this point, I want to emphasise very strongly that I am not a taxation escapist. I believe in Income Tax being used as a measure for redistributing income and I look to see a very high level of taxation maintained. But it is just for that very reason that I want to urge how important it is that taxation should be levied in a way which does not harm the industrial structure of this country. My last point is that we have, during the various stages of this Bill, had discussions on several complicated Clauses and I want to ask the Chancellor to do his best, as I know he always tries to do, to help those of us who try to follow these matters in the discussions. Those of us with business interests and responsibilities are in a somewhat difficult position. We are bound to speak according to our own experience in business but we certainly ought to be very careful that we do not speak according to our own business interests and that these should not influence what we say. We, here, ought to take into account only the national interest. The Chancellor of the Exchequer can help us very greatly in that respect. A vast amount of information is available to the Inland Revenue officials. Not only have they got voluminous records which must contain a mine of valuable information, but they have exceedingly able brains. I believe that more could be done, in interpreting the results which must come to the knowledge of the Inland Revenue authorities, to explain to us what the real position is and what the significance of particular tax changes may be. For example, when discussing Clause 22, I personally would very much have liked to have information showing just what the Chancellor had to guard against and what his Inland Revenue authorities told him the effect was going to be, of the various amendments that some of us put forward or asked for. If we could have the opportunity, perhaps not in public, but in those private discussions that go on, for really frank discussion so that we could learn exactly what might result from particular measures that we may be urging, I, personally, should feel very much happier in the part I could play in helping to promote sound tax measures. From all this information which is available in the Inland Revenue records it ought to be possible to extract most valuable lessons on what I have described as the indirect effects of taxation. I hope very much that what the Chancellor has promised as regards a new statistical service will make the fullest possible use of such information and that the Inland Revenue authorities themselves will be encouraged to take a human interest in these affairs. Personally I want them to act—as I am sure they are ready to act—not as soulless tax gatherers but as agents for a Minister, who as I have said is entirely dependent as a shareholder on the prosperity of industry, and also as patriotic citizens deeply concerned with the national welfare. Therefore I suggest to him that we in this House who are interested in finance could really take a more useful part in discussions if we could meet the Inland Revenue authorities, speak frankly with them and know what the inner significance of any proposed changes might be. One word in conclusion. The Financial Secretary in opening his speech described this Third Reading as the end of the story; but in truth when we are finishing the story of one Finance Act that is just the time when we ought to be thinking about the next one. Therefore if I were not bound by the Rules of Order of this House I should have liked to make some further remarks on the Finance Bill for 1944–45.There are just two points with which I would like to deal briefly. The Finance Bill presents an opportunity every year to review the national accounts. They have been made very much more interesting in recent years by the publication by the Chancellor of this White Paper, "Analysis and Sources of War Finance and the Estimate of National Income and Expenditure". But I feel that there are important gaps in that White Paper which I hope it will be possible to fill at some future date. It is clear that the State is becoming increasingly directly concerned as a partner in the economic life of the nation whether in the form of ownership of shadow factories, ownership of requisitioned mines or industries, or in the form of national investments in forestry, with which I am particularly concerned. That process is going on and will continue. I think the time has come when it ought to be possible for us to look at the White Paper and say: "The national capital investments are so much under their various heads", and have these items separated from ordinary current expenditure. We just cannot do that at the present time. I know the Chancellor's Department, like every other Department, is probably greatly overworked and understaffed. I know he will say: "I cannot do that now because it would mean too much time and difficulty now for my officials". I quite appreciate that, as I am sure the House does, but I hope that as soon as the opportunity comes, he will give us that which I am sure the House and the country would like to have.
In connection with Part II of this Bill, which concerns Income Tax, I hope it will be possible for the Chancellor before the next Budget to meet the obvious wishes of the House in regard to some reform of the workers' Income Tax—the "Pay as you go" method—but I will not develop that point. However there is another point I would like to raise. I would utter a word of warning with regard to certain effects of Income Tax and Excess Profit Tax. Reference was made on the Second Reading of this Bill to the taxation of reserves of industrial undertakings, having the effect ultimately of making it difficult to re-equip industry for post-war conditions. Exactly the same thing is going on in connection with agricultural enterprise. We all agree that there must be a very high level of direct taxation now, in order to prevent expenditure on anything other than absolute necessities. All the rest must go to the war. But that does not mean that one must interfere with the normal financing of undertakings, or make it difficult for post-war reconstruction. Evidence, is accumulating that well-managed agricultural enterprises at the present time are becoming increasingly indebted to the banks, through failure to allow sufficient depreciation and replacement for machinery on capital account such as would normally take place. Many farms which have been in debt to the banks as a result of years of pre-war depression and who have gradually been getting out of that position, are now going back into that position again because of the present level of taxation which is not accompanied by, I think, sufficient allow- ance for replacement and depreciation of capital assets. There is reason to believe it took, let us say, from £8 to £10 per acre to finance a 500-acre farm in 1938. It now takes £15 per acre, Owing to increased arable acreage and in consequence of greater depreciation and wearing-out of machinery and the new machinery needed in order to keep up to the highest possible level of cultivation, there is at least a 35 per cent. increase. There should be a proportionate allowance made before the final assessment of tax on the net income is completed. With regard to expenditure on other items like seeds, perhaps 200 per cent. represents the increase over pre-war figures and in the case of artificial manure 100 per cent., and fuel 100 per cent. I am not going to argue on these last points because they could perhaps more properly be dealt with under ordinary expenditure, but in the case of machinery I insist that there should be a greater allowance. It has been proved impossible to finance agricultural undertakings at present out of the 10s. left when the Income Tax and in some cases E.P.T. has been taken; very often it is not that nor anywhere near that. There is nothing like sufficient to finance an undertaking and keep it up to date and make it possible to run the farm, as things are at the present time, without borrowing from the bank. That is what is happening. I do not know whether the banks are going to be kind enough to carry this kind of undertaking, which is increasing. Therefore, I ask whether the Chancellor cannot, between now and the next Budget, examine the possibility of allowing for something which is a very legitimate expenditure, to keep the agricultural industry up to date, while seeing also that the finances of the country are kept in order.The Financial Secretary said he thought that some of our predecessors of bygone days would have rubbed their eyes at certain Clauses of this Bill. I can well understand my hon. Friend saying that, for there are certain provisions in this Bill which offend the fundamental principles of our Constitution. Even though those provisions may have been put in the Bill to meet actions with which none of us can have any sympathy at all, I do not think that the Bill ought to be allowed to pass without a protest in regard to these new matters, for I believe the time will come when we shall regret taking any step which would lead to the procedure of the Star Chamber and infringe liberties built up during centuries. The Bill creates crime in retrospect, a new feature which is alien to all justice. Parliament and the courts, for centuries, have always upheld certain basic principles. For example, a person is always held to be innocent until proved guilty. It has been said that it is better that ten guilty men shall go free, than that one innocent person shall be condemned and punished. You cannot maintain that under the provisions of this Bill.
Will the hon. Member point out where the Bill creates this crime?
Yes, in Part III. If the law is to be interpreted as to its spirit and not as to its letter we are embarking, I venture to submit, on a path which leads downhill to disaster. It is the duty of every citizen to know the law, but you cannot know a law which has yet to be created. Judges have said in the courts, time and again, that there can be no ethics in crime, or in taxation, and that, in my submission, is fundamental to justice. In taxation, either you owe money to the State, or you do not owe money to the State. After all, no one in this country pays money in taxation unless they think themselves properly liable. We all, I believe, claim the allowances to which we are properly entitled, and I doubt whether there are many members of the community who omit to claim allowances to which they are entitled and of which they are aware. After all, the arrangement of one's affairs in legal and proper form, so as not to be liable for extra taxation, is not always a matter of morals working in one direction.
Take Death Duties, for example, in connection with which in certain circumstances a person becomes liable for duties on the whole of an estate, not only in this country but in several other countries too. A situation can arise and has arisen, in which the percentages for which an estate becomes liable in this country and in certain Dominions, and, indeed, in foreign countries, too, are in the aggregate more than the total of the whole estate. That is an exceptional position, but it is nevertheless a fact. Surely, if in accordance with law, and in proper circumstances, a person's affairs can be legally and properly arranged to avoid that, there is nothing particularly immoral in taking that course. I suggest that the red herring of the whisky cases scandals—and they are scandals—has been introduced here to make fundamental and grave constitutional changes, which are passing through the House without their effect being fully appreciated. By all means let us tighten up the law, let us close every possible loophole; but I am sorry that the principle has been introduced that something which is proper and legal at the time it is done, is retrospectively to be made a crime. That, I believe, is fundamentally wrong, and I regret that we should have embarked on such a course in this Bill.May I add my voice to the very sincere tribute which has been paid to the Dominion of Canada for her generous and spontaneous act? It will be an inspiration to us and to those who will come after us, to remember how not only the Dominions but the Colonies have all sprung to our assistance in our time of need, and how Canada has helped us to shoulder this enormous burden. Each of the hon. Members who preceded me referred to changed conditions. Each called attention to some particular matter. For example, the right hon. Gentleman the Member for East Edinburgh (Mr. Pethick-Lawrence) emphasised what he has emphasised before—the question of paying Income Tax as you earn—and the Chancellor of the Exchequer has said that the Treasury is inquiring into the matter. There has been a change in the spread of Income Tax. The burden used to fall on a comparatively few; now it falls on the majority of the people of this country. The number of families in this country is roughly 11,000,000, and about 7,000,000 of them are now called upon to pay Income Tax. My hon. Friend the Member for Walsall (Sir G. Schuster) mentioned again the growing importance of what we call the White Paper which is now issued with the Budget, and asked for further and better particulars to be contained in it in future. What does that mean? It means that we are in a transitional stage. The Budget in future will perhaps take a different form. In this transitional stage, may I congratulate the Chancellor of the Exchequer upon the quick and comparatively easy passage of this Bill? The amount of taxation is growing, but the people are facing the fact cheerfully, because they realise that there is a sense of interdependence now among us all.
While there is that general feeling in the country, there seems to be less and less interest in this House in the ways of providing the money. The power of this House grew and its privilege extended through the care it exercised over money matters. It is still true, in theory, that His Majesty expresses to the House his needs for the year and asks the House to provide the means for him to carry on the government of the country. Therefore, the matter is brought before the House on what is known as a Vote of Supply, and it has been the privilege of the House to discuss its grievances before granting the Supply for which it has been asked. Then it is for the House to decide how that Supply should be met. That we do in Committee of Ways and Means. Might I direct the attention of the House to a matter to which new Members, an any rate, pay too little regard? This Finance Bill is ordered to be brought in by, of all persons, the Chairman of Ways and Means, one of the honoured officials, if I may say so, of the House. Of course, the burden falls upon the Chancellor of the Exchequer and the Financial Secretary to the Treasury, but this is primarily a House matter. For some years the House has been taking less and less interest in the matter. That means that the power of the Executive has been growing, and that of the House becoming less. How rarely does the House express its will against that of the Executive on any particular Amendment. If the Chancellor is determined that the ways and means that have been suggested by the Executive, of which he is a member and the mouthpiece, are the ones to be followed, he has the power of his party and of his Government behind him in forcing that upon the House. Great injustice might be done. That is much more likely in small matters than in big ones. The only case I can recall within 40 years where the House has taken a different view from the Executive on a major matter was when the late Mr. Neville Chamberlain was Chancellor of the Exchequer, just before he become Prime Minister. He introduced, as a part of the ways and means of providing the required Supply in his Budget, a new form of taxation which he called the National Defence Contribution. The necessary Resolution was passed. It was then included in the Finance Bill. But when it came before the House the feeling of the House, as representing the taxpayers, was so strong that the House enforced its will upon the Executive, and the Prime Minister, as he then was, had to withdraw the tax. That is a case of the House taking the interest which it should take in matters of taxation, because it represents the people, as against the Executive, in providing the ways and means by which the Executive can carry on. But in smaller matters, which perhaps directly affect only some aspect, and only indirectly affect the whole, the Executive has a tendency to become all-powerful. May I mention the instance of Clause 22 of this Bill? The matter was discussed in Committee and the Chancellor replied. There was not a very full Committee. If we had challenged a Division, the Chancellor would have had the full power of the Government behind him, he having accepted the advice that was tendered to him by his officials. Whether that advice, given to him, as it is, by very able men, would take account of the possibilities and the difficulties that would arise, one does not know. I want to join in paying the highest tribute to the officials of the Treasury for their ability, their high-mindedness, and their care in dealing with these matters, but, in their nature, they would take the line, I will not say of least resistance, but which would enable them, following their old rules, to collect the taxation with the least possible trouble. That might bring injustice on the people. It is the duty of the House to inquire into that.No, Sir; it is the duty of the Chancellor of the Exchequer. My hon. Friend is trying to make a distinction between the officials who advise me and the Chancellor of the Exchequer. There is not a person who knows the constitutional position who would not agree with me, that I could not let that go unchallenged. I would deprecate very much this endeavour to draw a distinction which has never been attempted or made in this House.
I do draw that distinction. It is inevitable under our Constitution. There was a time when this House was so jealous of its position that it did, for a time—and I think wrongly—tend to exclude the Executive from discussions in the House. Very rightly, it brought them back. But the Chancellor occupies two positions; he is a member of the Executive—and that is why he is Chancellor of the Exchequer—and he is a Member of this House, representing West Woolwich. It is the duty of this House to examine these proposals with extreme care. Of course, the Chancellor looks into them, and it is necessary that he should do his best to ascertain what would be the effect of them, not only on the House but on the country. But the House, for some time, has not inquired into these matters with the care and attention that was shown in the past. I am sure that we shall have to consider in future some other means of bringing these matters to the attention of the House, and that we should accept some other advice than that of the officials of the Chancellor of the Exchequer. I realise that I cannot develop this matter further at the moment, as we are on the Third Reading of this Bill, but, as the hon. Member for Walsall has said, the moment one Budget is over we have to consider what will be the financial proposals for next year. I sincerely suggest to the House and the Chancellor that these matters to which I have referred must receive not slight but very considerable attention between now and the next Budget.
I do not purpose following the hon. and learned Member for Montgomery (Mr. C. Davies), because I am afraid that if I did you, Mr. Deputy-Speaker, would rule me out of Order very quickly. I want to put a point which has not been put across to-day. I have heard some hon. Members say that people are paying the tax cheerfully and patriotically. I do not find that state of things in my Division. There are thousands of men now paying tax who never paid it before, and it is pinching the toe in the shoe. I do not know whether the Chancellor of the Exchequer knows the feeling in the country among working-class people, who say that if they are to pay tax, they should pay it on the wages they earn in the current week. The Chan- cellor says that he has been thinking this thing out, but we have not yet got any scheme. For what purpose have we made the right hon. Gentleman Chancellor if we cannot get from him a scheme to meet the weekly wage-earner? He has been Chancellor of the Exchequer for some years and has brought in certain reforms as far as taxes are concerned, and he has wrung more money out of the British public than any other Chancellor. He has managed it somehow. I want to put a concrete case to him. I met a miner's wife in my Division on Monday afternoon, and I said to her, "How are you getting on"? and she replied, "I am getting on bad. Our Jack, on Saturday only brought a bob home after he had had his tax stopped off it." [Interruption.] That was the statement that she made to me. It was his back taxation he had had to pay, and he had had a snort week. Half a dozen colliers stopped me in the street this week end and said, "Ask the Chancellor of the Exchequer, if you have the chance at all, to let us pay our tax when we draw our wages on Friday or Saturday." Another fellow came up to me and said, "George"——
While it is perfectly legitimate for the hon. Member to state that this would be a better way of paying taxation than that contained in the Budget and give possibly one illustration, if every hon. Member were to give numerous illustrations, we would get rather far away from the Budget itself.
I am sorry you stopped me, Mr. Deputy-Speaker, because the case I want to give now is more vital than the other one.
We will make it two, then.
I will sit down after this one. The demand note of this collier for the next 25 weeks was £38. He pays his tax six months back; in 25 weeks it worked out at 34s. 4d. a week. At the present time this man is only doing four days a week because he is sick, and he said to me, "I wish I had paid this when I was earning the money." That is the point that I wanted to put, and I would ask the Chancellor to alter the paying of the tax an this way as soon as possible. Some of these men have spent the money six months after they have earned it. If such a man is killed, the Chancellor will lose that money. He cannot get it out of the wife, as she will have none. I want to put this case in the way that the miners and their wives give it to me, so that the Chancellor will at least understand what they think about it.
I very much sympathise with the hon. Member for Hemsworth (Mr. G. Griffiths) on the question of "pay-as-you-go," and I would like to add my voice to the voices of others who have urged upon the Chancellor that he will, before his next Budget, consider the various schemes of this kind which have been suggested and which we believe are being discussed elsewhere, to see whether something of the kind is not possible to avoid the hardships of which the hon. Member for Hemsworth gave one or two very striking examples.
I would like to turn from that to the speech of the hon. and learned Member for Montgomery (Mr. C. Davies), with which I found myself in profound disagreement. If there is one doctrine more fully established than any other, it is that of Ministerial responsibility to the House of Commons. If Members here are not taking the interest that they should do in the financial affairs of the State, it is due to the Members themselves, and not to the Chancellor of the Exchequer or to the Treasury officials. The hon. and learned Member shakes his head, but he certainly gave us that impression.I regret that I should have given that impression. I did not want to convey such an impression but to convey the impression that matters of ways and means are for Members of this House as a whole, and therefore they should take more interest in them and discuss them more fully and not merely accept them. That is the point.
I am glad that the hon. and learned Member has said that, because we are all in agreement with it, but I think that if he will look at his words in the OFFICIAL REPORT, he will find that he rather led us to consider the officials of the Treasury as apart from the Chancellor of the Exchequer, and that we really must not do. The Chancellor of the Exchequer is the man responsible. I entirely agree with the hon. and learned Member that Members of this House do not take sufficient interest in our financial affairs. Nowadays, if one has regard for the history of our constitutional procedure to which he referred, it is rather distressing to see how little interest people take in the work of the Chancellor of the Exchequer in safeguarding the Treasury and how much interest they take in spending. The Chancellor of the Exchequer, if he has any complaint—he is so polite and considerate to us all that probably he has not—he would rightly say that he does not always get the support of this House for protecting the interests of the taxpayer that he might expect. It is very easy to come down here and make proposals for spending money, but it is not very popular to come and support the Chancellor of the Exchequer in resisting those proposals and seeing that our financial affairs are so ordered and so done that we can face the future with the confidence with which we ought to face it. This Budget, and future Budgets to the end of the war, will have a very material effect on what happens at the end of the war. If we are to pass from the state of war into the period of reconstruction and of peace with success and with as little friction as possible, it is essential that our finances should be on the soundest possible principles, and the utmost care should be taken to make people understand that we are not inflicting upon them any burden that we can possibly avoid.
Several speakers have said that the people are bearing their burdens of taxation cheerfully, and that is undoubtedly true. My hon. Friend the Financial Secretary said that the people would bear them cheerfully if they believed that the Chancellor was acting fairly. That is true but there is something very much more in it than that. People are bearing their burdens of taxation cheerfully on the understanding that at the very earliest possible moment all classes of taxation should be reduced. Whether a man drinks his pint of beer and pays his 7¼d. or whatever it may be in taxation, or whether many of us have to live on capital because of the operation of taxation and Supertax, people are bearing the burden because they believe that the Chancellor will reduce taxation as soon as it is possible to do so. It is essential that people should believe that. If you want men to be put back into employment quickly after the end of the war, you must create in those whose particular business it is to organise industry a feeling of confidence that they are not to have unduly heavy burdens placed upon them in their efforts once more to expand in those fields of export and elsewhere which have brought so much wealth to this country in the past. There is one other point I would like to make. The right hon. Member for East Edinburgh (Mr. Pethick-Lawrence) referred to Clause 22, which has now become Clause 24, which is associated in the minds of a great many people with whisky. I am bound to thank the Chancellor of the Exchequer for meeting us over this point. Those of us who proposed that the Clause should be drafted so as to exclude the innocent, had a very real fear in our minds, which reflected a very real fear throughout the country. Although I agree—and no one would agree more than I do with the right hon. Gentleman the Member for East Edinburgh—that we should tear down the façade and get at these tax criminals, the more we do that the more we must be careful that we do not involve the innocent with the guilty. No one can fail to be cognisant of the many examples of the hardships that occur at the present time. An additional 1s. or 2s. in the £ may not be a hardship but it may become a real hardship when the Income Tax is 10s., plus Surtax, and it is important that we should make the clearest distinction between what I would call the tax criminal and the man who is merely taking the ordinary advice of the highest authority in the land—the Judges of the High Court—so as to reduce his taxation to the legal minimum to which he is entitled. It is very important that we should see that the distinction, as it has been to some extent defined in Clause 24, is continued in future legislation which the Chancellor may introduce. I would only say, in conclusion, that I hope the Chancellor will very seriously consider the question of "pay-as-you-go." Here again, it not only affects the present position, but it affects, what I am very largely concerned with, the post-war position and the transition from the state of war to the state of peace. There may be many changes in rates of pay—I hope not—but undoubtedly there will be many changes in earnings. Overtime will be stopped, and many weekly wage-earners will find themselves with nominally the same trade union rate of pay but with a much lower amount of earnings, which may lead to serious friction and serious hardship. Therefore, I hope that the Chancellor will see by the time his next Budget arrives whether he can at least mitigate part of the dangers and hardships which might arise in the circumstances.I do not intend to follow the hon. Member for The Wrekin (Mr. Colegate), whose speech was something of a mixture. He defended vested interests in one part and later referred to workmen whom he wanted to protect.
Both have vested interests.
To-day the Chancellor has done a tot of nodding, and I think he is riding very easily because his Financial Statement has been so well received by the House. The Financial Secretary has given us an indication of what wars mean. He told us that the present National Debt is £17,000,000,000—that is twice as much as it was before the war started—and we realise how costly wars are when they are fought on the scale at which this war is being fought to-day. What we have to try to do is to avoid war in the future. Wars like the present war cause everything to go to the top, and we must try to avoid that in future. I want to commend the Chancellor on Clause 24, which deals with tax dodgers, people who have had stocks in hand and who have resold them in order to evade State duties. I think Parliament has done a piece of creditable work in dealing with this class of case, although whatever we may try to do to stop loopholes the fact remains that there are men and businesses who continue to use every endeavour to dodge their State responsibilities. Such action is very unworthy at any time, but is even more so in war-time, when we are asking everybody to throw everything they have into the national effort. Therefore, I hope that when people of this sort come within the clutches of the law an example will be made of them in order to try and prevent others from doing the same kind of thing.
As regards easy borrowing, some of my hon. Friends and I have advocated for many years a reduction of interest charges, and we take some little credit to ourselves. We are pleased that the rate is down to a practical minimum that will appeal to investors. I hope to see the time when the State will not require any borrowings at all. The hon. Member for Walsall (Sir G. Schuster) spoke about a 50 per cent, interest in industry; if we can get a 100 per cent. interest, then we can control any finance. I would like the Chancellor to pay particular attention to my final point, which is in connection with Post-War Credits. Wherever I go I find there is a lack of knowledge as to what the State intend doing when the war is over, when repayments will be made and how they will be made. I am met by such inquiries as this: "If I should die, to whom will my Post-War Credit go? Will it go to my wife or family, or will the State take it?" Another one was this: "If I accumulate Post-War Credits for a year or two, can the Chancellor include that in my assets and tax me on it?" I have with me my own certificate of Post-War Credits. [An HON. MEMBER: "And a bachelor, too."] Yes, and a bachelor has to pay more, and rightly so, because he has certain advantages that a married man does not get. It is difficult to understand what will be done when the war is over, and I think the Chancellor might make some explanation when he sends out the certificates. I have here, too, another document, entitled, "How to fill up your form," which is circulated with the Income Tax forms. There are 31 paragraphs in the document, but I do not find any mention of Post-War Credits. Will the Chancellor, therefore, on the certificate of Post-War Credits give a fuller explanation of what they mean or say something about them when he sends out this other document showing people how to fill in their Income Tax forms? This would enable a lot of people to feel that at some time or other the State will make repayment. I know it is very difficult to say when that will be; it will depend on the result of the war. I expect payment will be made according to the needs of the people. There is this further point. In a newspaper on 30th June I saw the headline "£10 tax credits 10s.," referring to a paragraph which said:This statement is false. There is no miner doing that kind of thing. When I saw that in the newspaper I wondered what was behind it. I have been asked by miners to refute the statement, but I want the Chancellor to do it as well. I wonder whether the Chancellor would make a statement something like that he made when Post-War Credits were introduced in 1941. I have re-read the statement he made then; it is a clear statement, but after a year or two people are apt to forget, and if he would make clear what is the intention behind these Post-War Credits, I think it would give general satisfaction to the public. I have nothing further to say now. I raised certain objections on the earlier stages of the Bill because I thought it was necessary. I protested, for instance, against the extra tax on beer and the extra tax on tobacco. I know that the money has to be found somewhere, but I did think that it was rather harsh on the people who had to pay the extra money."'A fear among miners that they will not get their post-war Income Tax credits is being fought by the North West Regional Industrial Savings Council,' said Mr. Harold Parkinson, Chairman of the Council, speaking in Manchester yesterday. I know of cases where miners have been offering £10 certificates for 10s.: he said."
We have had a series of interesting speeches that have ranged wide. May I bring the House back to one particular Clause of this Bill, to which I hope we shall give a unanimous Third Reading? On the Committee stage I moved an Amendment to what was then Clause 21, but has now become Clause 22, and the Chancellor was good enough to say that the point I had raised was one of substance and that before the Report stage he would put down an Amendment to clear up the matter. On the Report stage no Government Amendment covering that point appeared on the Order Paper, and I think it is now the Chancellor's intention to try and deal with it—it is somewhat technical—by means of Regulations. Perhaps my right hon. Friend, when he is winding up this Debate, will be good enough to clarify his intention. If that is his plan, I think that he can cover a great many of the cases concerned by means of Regulations, but I also believe that a certain number of cases will still be omitted, and in that event all who are interested will continue to watch the matter in case it is necessary to put down a new Clause in next year's Finance Bill. If I am right in my supposition as to what my right hon. Friend is thinking of doing, let me say that I am grateful.
There are only two general matters on which I would like to touch. First, may I ask the Chancellor to give serious attention to the proposal I made in a previous Debate, that he and the Treasury should prepare and issue an interesting, popular booklet on the subject of how we are paying for the war? Every person outside this House with whom I have discussed the suggestion has agreed that such a booklet would be of wide interest. My own belief is that here in the House one of the principal reasons why the Chancellor has carried all of us with him in his financial proposals is because of the exceptional trouble he has taken to explain in his Budget speeches and other financial Debates not only his cut-and-dried proposals but the principles of action which have lain behind them. We have felt that we have been let into his mind, and that fact has helped to carry us with him. Unfortunately, or perhaps fortunately, the general mass of the people of this country to not read the OFFICIAL REPORT and, consequently, they have not had the same opportunities as we have had to get a firm grip of the principles on which the Chancellor has conducted his financial policy and by which he is enabling us to pay for the war. Nothing will remove my conviction that there would be a large demand for an authoritative, well-written booklet of this kind, priced at sixpence or so, by means of which people could turn up the correct answer, and not some fancied answer, to the question: "How is Britain paying for the war?" My only other point concerns the attitude of this House to finance and taxation. I agree with some previous speakers that not enough hon. Members take an active interest here in national finance. One of the difficulties appears to me to be that in between one Budget and another, one Finance Bill and another, it is extremely hard to raise, except at Question time, any matter affecting taxation. In almost any of the other financial Debates we have during the year, taxation matters are out of Order. This shortcoming could in large measure be met if arrangement was made by which the House, one day early in the new Session, annually, could have a day's De- bate intended to give opportunity for a review of taxation principles and large tax questions with which the Treasury and the House have to be concerned whenever new Budget proposals are being brought up. As it is, the only opportunity provided for a Member to raise these matters is either behind the scenes with the Chancellor or else in Debates after the Budget, when the Chancellor has made up his mind as to what he intends to do that year, so that it is the least likely time when he can make any considerable changes. That is why I should like to commend to the House that we should press for the holding of a Debate of the kind that I have described at some time between every two Budgets.The lion. Member suggested the publication of a pamphlet telling the public how we pay for the war. I should like to draw his attention to a pamphlet recently published by the Oxford University Press showing that we shall not be very much poorer after we have paid for the war, and disillusioning a good many people who preach that we shall be so poor that we shall have to tighten our belts. It is most instructive, and I hope it will be widely read.
I cannot see that either of these pamphlets has anything to do with the Budget.
My right hon. Friend the Member for East Edinburgh (Mr. Pethick-Lawrence) started off by offering bouquets, and I think the one he offered to the Chancellor of the Exchequer was well merited. The difficulty about finding out all the good things that Ministers do is that so many of us are fully occupied chasing their shortcomings. Having spent two years on the War Expenditure Committee, we found it very difficult to give much praise to anyone and, when we would like to have published a report complimenting the Government and the country on our very great achievements, it did not seen to come within our terms of reference. Much as we should have liked to do it, we found that we could not spend much time on it. At the same time, while we want to give the Chancellor and the Government all credit for their achievements—and they are many—those who have read the reports of the War Ex- penditure Committee must ask themselves occasionally if the Chancellor has not some responsibility for paying more attention to some of those reports when he has to raise the money and sees so much gross waste and inefficiency. Has he not a responsibility to look more carefully into those things? I sometimes think he ought to look upon himself not so much as a national cash register studying only where he is going to get the money to pay his debts. He should be very much concerned about seeing that people's pockets are adequately filled, so that he can levy a contribution on them, which involves a study not merely of finance and the meaningless symbols of L.S.D., but of our national economy. He should be studying and giving the House more carefully devised scientific plans for the distribution of the national income. Unless L.S.D. are related to the national income, and to the actual production of real wealth, they do become meaningless symbols. The Financial Secretary said that it was better to travel hopefully than to arrive.
I said some people say so.
That is a different thing, because the hon. Gentleman did not say so when speaking recently about the Beveridge proposals. He did not give people a chance to travel very hopefully.
I have not made any speeches about the Beveridge proposals anywhere.
The hon. Gentleman is much wiser than some of his colleagues if he has not. I had it in mind that he had made some very scathing remarks about people making wild proposals for spending the national income, whereas the Chancellor of the Exchequer and his colleagues, when speaking about what we can and cannot afford, give the impression that at the end of it we are going to be very much poorer and people will have to tighten their belts. Are they not going to consider that the men who are doing the fighting are paying in the only currency they can, in sweat, and blood and toil? You must not talk to these men who are making this tremendous sacrifice about coming back to further sacrifices and tightening their belts. Are you going to inflict penalties instead of rewards on them for all their work, or are you going to encourage them and say there is to be a scientific distribution of wealth when they return, instead of constantly sneering at people who try to help the Chancellor to do his job more efficiently? There is a lot of common ground in the House and in the country, but frequently we are talking at cross purposes. I believe that if we re-instituted a limitation of dividends, it would overcome many of the evils that we are all opposed to, but no one seems to be entirely agreed how this should be dealt with. It would abolish what is now taking place, speculating in gold shares, a commodity which no one wants. The Chancellor has the responsibility, which he does not pursue, of discouraging the hope that we are going constantly to base our currency on this obsolete gold standard idea. The best authorities in the world would agree that there is an abundance of gold to last us for evermore, and there is not the slightest justification for producing another ounce, from any point of view.
The Financial Secretary went back to the question of savings, and the idea of large numbers of people spending their energy week after week doing something which we think entirely unnecessary, because the Chancellor has access to all he requires in other ways, telling the country things that are positively untrue, though not quite so untrue now as they used to be, and trying to make them believe that they get more battleships and aeroplanes. They do not do that now, because they recognise how ludicrous such a statement was. The Financial Secretary said that we got from other sources 34 per cent. of the savings, but he did not tell us how much came from insurance companies. We are misrepresented sometimes as attacking the banks, but that is grossly unfair. Whatever system we may have in future, we have to-day the soundest and safest banking system in the world, and I do not want to alter it in the slightest unless we discover something much better. But that does not alter the fact that the banks are the first to admit that they get a lot of interest on money which they do not possess but deliberately manufacture. One could argue that it does not do a great deal of harm in the long run, and if in the future they were committed to not increasing their dividends, perhaps it would not do any harm.
I cannot find anything about this in the Bill. We are rather strict on the Third Reading and can only refer to what is actually in the Bill.
One hears remarks about the proposals to tax the tax dodgers. Those most ingenious people have been of great service, because they have shown all the loopholes and all the weaknesses which we have not noticed ourselves, and if there had not been those lopholes, we should not have discovered what scoundrels we have in our midst. They are only an infinitesimal proportion of the community, but there they are. I remember a previous Minister saying that the only Scriptural injunction that is obeyed in the City is to watch and pray, but they spell it with an "e" and not an "a." There are still a lot of people who have to be watched, but they have now exposed themselves, and we know enough to circumvent them.
We have had expressions of gratitude to Canada for their generosity, but I am sure we are all agreed that, when the time comes for settling these things, there will be an equitable settlement of the total bill for the war. We do not know yet how much everyone is to have to contribute, but America was wise enough on this occasion not to begin to build up a war debt. I suppose at some time or other it must be converted back in terms of universal Lend-Lease. Let us have a fair understanding that all are going to pay their fair share, and let us pay compliments at the end when the final settlement comes.I agree with the hon. Member that the ingenuity of certain people in the past has certainly helped the Chancellor in framing measures to catch them now. That brings me to the point that I want to make, namely, the retrospection of the Bill. I said in Committee that the general purpose of retrospective legislation is that it should be retrospective in regard to the clarification of the existing law. That is not the case with this Bill. Clause 24 is a clarification of Section 35 of the Act of 1941. It should not bring in transactions which were not previously liable to tax. It is of far-reaching effect and should actually refer only to the sale of stock below cost in accordance with Section 35 of that Act.
I should be the last one to countenance the type of people we have heard of during recent discussions. I would not for a moment hold a brief for them. I would not suggest that the Chancellor should not use the harshest measures for catching them in the future. But I want to say a word about the principle that is being asserted in the present Bill. It goes much further than clarifying the law. It makes actions which were perfectly legal in years past completely illegal now. All the people who apparently acted quite legally in years gone by are now having their acts declared illegal. That is a most dangerous principle and I cannot think of anything more disastrous in a Bill. In three or four years' time we might have a Government which, taking a Bill like this as a precedent, will look upon the acts of many of us as averse to the policy that they might then have in mind, and they might lay down that many of us acted illegally. That could well be done and it should be put on record. The Attorney-General said in regard to this provision:In past discussions we have heard the most extraordinary remarks from hon. Members and they have talked in a way that betrayed loose thinking on their part. It suggests to me that the House has not quite grasped the position. We have heard different expressions such as "tax evasion," "fraud," and "criminals" applied to these people. In a moral sense perhaps they are right, but we must bear in mind that in the past all these people acted perfectly legally according to the law of the land. Taxation falls on every member of the community and I do not think eat any one desires to pay his taxes."It is retrospective and applies to all these past transactions … The Amendment will … operate in the main on what has happened in the past when the scheme was legal."—[OFFICIAL REPORT, 29th June, 1943; col. 1515, Vol. 390.]
Hear, hear.
My hon. Friend probably takes the same attitude as the hon. Member for Hemsworth (Mr. G. Griffiths) took a short time ago. I wonder whether anyone who returns his income brings in any more than he should. Does he bring in some gilt in order to swell his income? When a person makes out his expenses for the revenue does he not bring in as many expense, as he is legally entitled to do? I wonder how many people pay the Chan- cellor voluntary taxes. Suppose a man is not liable for taxes, does he offer to pay? Does anyone pay the Chancellor any more than he should pay? That is the general attitude to taxation and it is perfectly legal. If the law was such that an action taken at a certain time was legal we should be very chary before we pass a law against that action and make it retrospective. I should like to quote one or two extracts from the previous Debate. The hon. Member for East Birkenhead (Mr. Graham White) said this, and it is an example of the loose thinking to which I referred:
The important point is that they were not legal liabilities at that time. The hon. Member for North-East Leeds (Mr. C. Henderson) said a similar thing."In these clays apparently the buccaneers go into the City and, by these nefarious transactions, seem to avoid the liabilities which the rest of the community in honour bound accept in war-time."—[OFFICIAL REPORT, 29th June, 1943; col. 1495, Vol. 390.]
They could not evade the Excess Profits Tax, because they were not liable to it owing to the looseness of the Bills brought before this House. The Noble Lord the Member for Horsham and Worthing (Earl Winterton) described the matter in language which we are accustomed to hear from him. He said:"There were some people … who were out to evade Excess Profits Tax."—[OFFICIAL REPORT, 29th June, 1943; col. 1496, Vol. 390.]
I deny it. None of these people committed any wrongful act at the time. I am not sympathising with them and I hope the Chancellor will catch as many as possible under the new Clause, but what I am trying to draw the attention of the House to is the fact that this is retrospective legislation in a dangerous sense. The right hon. Member for East Edinburgh (Mr. Pethick-Lawrence) made remarks of this kind:"Any man in this country who seeks to defraud the Revenue is committing a criminal act, and if any hon. Members deny that let them get up and say so."—[OFFICIAL. REPORT, 29th June, 1943; col. 1500, Vol. 390.]
People are perfectly entitled to go to their lawyers and. ask for advice about any matter. They are not conspiring to commit a crime or something of that kind. The law says that certain action is not illegal at the time. I wonder how many lawyers there are who have not been asked advice in regard to some point where their clients wanted to get out of what they thought was a liability. It is the job of lawyers to advise on such matters and we cannot blame them in any way. They are acting quite properly in the course of their profession. To use these loose terms in the House is a grave mistake. The House in embarking on legislation of this retrospective kind is setting a precedent which at some future time might well come back on the heads of the people of this country. We have handed to the executive Government enormous powers which only Parliament can soften and control, and it is as well to remind the Government that they should go very carefully in these matters. They should not by one Clause of a Bill make a precedent for sweeping and backward legislation. If they do that we shall be entering into dangerous waters and the freedom and liberty for which we are supposed to be fighting might be gravely endangered."If a person, wanting to commit a crime, went to a lawyer in advance to find out how he could do it, and came less badly off as a result, I am not quite so sure that the lawyer who gave him advice in that way would not be an accessory before the fact."— [OFFICIAL REPORT, 29th June, 1943; col. 1511, Vol. 390.]
I have only two or three remarks which I wish to address to the Chancellor and his right-hand man. Not having listened to all the Debate through circumstances over which I have no control, I will deal only with what my hon. Friend the Financial Secretary said. He tried to frighten us or to impress us with the danger with which we shall be confronted at the end of the war in facing the cost of the service of the National Debt. I wish he had been a little more frank with the House and the country by reiterating what that service is likely to be, because in my opinion and the opinion of those who hold views such as I do, which are shared I believe in his heart, not by the Chancellor, but by the Financial Secretary, it is important that people should realise of what magnitude this service will be. The Financial Secretary gave the National Debt as being now £17,700,000,000. Taking the Prime Minister's forecast of the end of the war in Europe as the end of 1945, it is doubtful whether it will be less than £22,000,000,000 or £25,000,000,000 by that time. As far as I can judge, the service of the National Debt will be of the order of £600,000,000 a year. It would have been much better had my hon. Friend made it clear to the House and the country what the figure is. I may be wrong, but the figure is of that order, and it is important that people should understand it. May I make this reflection also? The cost of the service of the National Debt would not be so great if the Chancellor had taken my advice and the advice of some others and insisted on interest-free loans during the war, and if he had taken unto himself the power and the right to create and control money and credit.
The Financial Secretary slid very quickly over another point as if not wishing to tell the people what the truth is. If he wanted to tell the truth, why did not he do so? No doubt I shall get a satisfactory answer to my next Parliamentary Question on the subject. He slid over the part played in the "Wings for Victory" weeks by the small subscriber. I tried to interrupt him to ask him to tell us what the proportion had been. I hope that on the next suitable occasion, which as far as I am concerned will be in the next series of Sittings, he will tell me precisely what the small subscriptions have amounted to. If he was able to make the statement he did make to-day, he must know, whereas whenever I ask the Chancellor what the analysis is he always says that he does not think it profitable to make the analysis. The two things do not hang together. There ought to be more fraternity between the Chancellor and his Financial Secretary to prevent their falling into this mess. No doubt we shall now get at the truth. The third point I wish to make on my hon. Friend's opening speech is his curious analogy between finance, fire and water. If there had been alliteration in the phrase, one would have felt more sympathetic about it, but there was not even that. I see no relation whatever between fire, water and finance, except possibly that fire might be used to burn up the rubbish which the City issues. Fire and water are absolute things which you can understand, but what is finance? It is the biggest humbug which has ever been perpetrated on the peoples of the world.
I said they were all bad masters but good servants.
But my hon. Friend did not set out to explain to the people how badly they had been misled by this humbug of finance. He went on to say that the methods by which the Treasury had conducted our finances in this war had left them less vulnerable than might have been expected. Vulnerable to whom? To the taxpayers? No. To the other members of the Government? No. To the Tory Party? No. To whom? Less vulnerable to the vagaries of finance controlled by private interests to the disadvantage of the ordinary citizens of the country. He did not say that, but that is what he really meant. I hope that people will, take to heart what he has implied in his remark, and insist that before the end of the war there shall be a change in the control of the whole financial machine. Finally, though I know it would be out of Order if I were to develop it, I want to spend one minute in offering an admonition to my right hon. Friend the Chancellor of the Exchequer. He will be aware that on the Second Reading of this great Bill 70 wise virgins, with lamps filled, put down an Amendment urging that he should make certain provisions to acquire for the people of the country——
Order. We have had a very wide Debate, but on Third Reading hon. Members cannot put forward any suggestions as to what the Chancellor of the Exchequer ought to have put in the Bill.
With great respect, I am not suggesting what he ought to have put in the Bill. I am only offering him a little advice as to what he ought to consider and put in the Bill before he comes to the House with his next Budget.
That is a matter which the hon. Member had better put forward at Question Time. He cannot make the point on Third Reading.
My difficulty with the Chancellor is that at Question Time he will not answer my Questions.
That has nothing to do with me or with the Third Reading of this Bill. I suggest that the hon. Member should frame his Questions, better.
I will certainly take your advice, Sir, but may I be allowed to conclude my sentence by saying respectfully to you and the Chancellor that I hope he will re-read that very wise Amendment put down upon Second Reading, take into consideration the justice of this case for which the 70 wise virgins stand, and see that provision is made next year before he introduces the Budget?
I have sat through this Debate for quite a long time and have heard several suggestions made to the right hon. Gentleman as to what he ought to do in order to get the necessary finance for the war. I think I should be justified in saying to those who from various parts of the House may have sympathised, as the hon. Member for Southampton (Dr. R. Thomas) did, with those who have hitherto been practising tax evasion, that I do not think the country will support their view but will back the right hon. Gentleman in what he has done. Some of us feel that he should have gone rather farther than he has done in that direction. When I heard my hon. Friend the Member for Southampton as I thought apologising——
rose—
Though the hon. Member said he did not sympathise with the tax evasionists, I felt he was supporting them. I think that when those boys and girls of ours who are fighting in this war, those men of the sea from the hon. Member's constituency and elsewhere, read haw in this House people are still defending those who are avoiding their rightful obligations to the nation while they themselves are risking their lives, they will estimate the hon. Member's contribution at its rightful value.
I want to say a word for the mass of the people who have recently been brought within the scope of Income Tax. It may be, as has been said, that people do not rush forward to pay their taxes, but as regards the broad belt of the population of the country, I believe that if a proper appeal is made to them, if they are shown how necessary finance is for the prosecution of the war, and they feel that an attempt has been made to lay the greatest burdens upon the broadest backs, we shall find them ready to support these taxation proposals in the Budget. Like a good many other hon. Members, I sit at times in my Division to receive my constituents, and among the complaints from the men in the Forces is this: Often they say they have left a good job in civil life and are reduced to the lower income which they receive when they join one of the Services, and out of this meagre pay they ought not to have to pay Income Tax on their past earnings, particularly at a time when tax evasion is taking place in other quarters. I want in my contribution to this Debate to support the plea which has been made to the right hon. Gentleman to usher in speedily some system of "pay-as-you-go" for working class Income Tax payers. I was interested in the remarks of my hon. Friend the Member for Hemsworth (Mr. G. Griffiths) about how this question was viewed in the mining districts. I come from the constituency next to that of my hon. Friend. There is turmoil over the system now in vogue, and T believe it would be to the advantage of production and would certainly give satisfaction to the people if we could introduce a system of "pay-as-you-go." It is all very well for apologists of the present system to say that a man may have had a period of low wages and would pay the Income Tax on those low wages at a time when he is earning a high rate of pay but the complaints we hear do not come from those folk but from people who have worked through a high wage period and are having to pay the tax on those high wages in a period when they are receiving only low wages. I expect that the Chancellor will say in reply to the hon. Member for Hemsworth that there never was an instance where a man paid so much tax in a week that he was left with only 1s. to take home, because I know there are provisions whereby too much tax cannot be deducted from a man's wages in one week because of minimum wage standards, but could not something in the nature of a direction go forth to employers of labour—without the necessity for all the circumlocution attending appeals here and appeals there from workers—that a minimum standard of wages should be paid and that no deduction of Income Tax should be made which would bring the wages below that standard? May I also put in a plea for consideration for the women war workers? I know that already the right hon. Gentleman has allowed for an increase in their earnings standard before they are taxed, but I would point out that many of them are married women who were formerly acting as housewives and that they now have to meet heavy travelling expenses in going to work. I stood on the platform of my local railway station at 6 o'clock on Monday morning, and I saw about 600 workers there, the overwhelming majority of them women. Most of them were women who had newly come into industry. It was a district in which formerly there was a heavy roll of unemployment. Those women get no rebate for travelling expenses, and I suggest that that is a matter which should have attention from the right hon. Gentleman. The right hon. Gentleman suggested, and I am sure he intends it, that the system of "pay-as-you-go" ought to be introduced. I suggest that he might consult with the members of his staff who are working in the districts most affected by the present system, and I think also that the Staff Federation of the Inland Revenue Department might bring to the right hon. Gentleman's notice a scheme for "Pay-as-you-go" which in my view is worthy of consideration.I think I am correct in saying that the last half-dozen Members who have addressed the House on the Finance Bill have started by declaring that they did not intend to speak for more than a few minutes and apologised for the fact that they had risen at all. But this is a Finance Bill dealing with £3,000,000,000, and I have not the slightest intention of apologising for discussing it as long as I like. If the Government have put down other Orders for to-day they have done so at their own risk. A Bill raising £3,000,000,000 is one which requires very careful consideration by this House.
I am very glad that the right hon. Member for East Edinburgh (Mr. Pethick-Lawrence) raised once again the tax avoidance Clauses, and I think the Chancellor will admit that to-day that has been the topic of main interest. My right hon. Friend said that sooner or later the Chancellor would have to take the power to tear down the facade of these artificial erections raised by the tax evader. I think we are getting to the time when he will have to consider recasting the whole policy of taxation in so far as avoidance is concerned. We have a very efficient Income Tax machine, but let us not forget that its effectiveness rests very largely on the fact that we pay our taxes more or less voluntarily. No matter how efficient the machine may be, unless a tax commands the acceptance of the tax-paying population it cannot be efficiently enforced. There is no question that after the war we shall be faced for many years with a very much higher rate of direct taxation than before the war. I am afraid that may lead to post-war avoidance, or to attempts at it. Mr. Philip Snowden, when he was Chancellor, put 2s. on the Surtax in 1929 or 1930. I do not think the Surtax ever recovered from that. If one takes the yield of Surtax and the growth in that yield from 1929 onwards, and compares it with the growth of the national income and the growth of the yield of ordinary Income Tax, there is a very great discrepancy. That increase of 2s. shocked the Surtax payer. It did not carry the consent of the Surtax payer, and I do not think that in the long run the increase of 2S. increased the yield of Surtax over that decade.Is my hon. Friend suggesting that that result, is due to evasion?
Not evasion, but avoidance. Evasion is illegal and avoidance is legal. I can only assume that a good deal of avoidance did take place in the period between 1929 and 1939.
We have gone a long way towards stopping loopholes and in the future avoidance will be of an immensely complex nature, and that means increasingly complex taxation machinery—even more complex than at the present time. That complexity contains a definite danger. The basic principle of our taxation has been a precise definition by this House of what is taxable and what is not, with the right of an appeal to the courts as to what the interpretation of our legislation should be. This is a fundamental principle of the method of levying taxation. The Financial Secretary to the Treasury himself referred—I have his words here—to the "struggle throughout the ages to protect the taxpayer from the Crown." It is almost true to say that the history of the growth of Democracy has been the history of this House asserting its right to tax. Precise definition of what is taxable and what is not, is inherent in our whole financial system. But an increasingly complicated system of avoidance, prevented by an increasingly complicated system of tax avoidance Clauses, may well develop a very grave weakness in that system of precise definition. Let me cite what has happened in connection with the present Finance Bill. Speaking on Clause 24 during the Committee stage, the Chancellor of the Exchequer himself said:That is a pretty wide statement; but notice how the Attorney-General interprets that wide statement. Speaking on the recommittal stage, the Attorney-General said:"I find it very difficult to imagine anyone connected in any way with these cases being able for a moment to pretend that there is anything innocent about any of them."—[OFFICIAL REPORT, 2nd June, 1943; col. 322, Vol, 390.]
The atmosphere and the emphasis of those two statements are as wide apart as possible. I want to draw particular attention to the statement of the Attorney-General. He admits here, clearly and definitely, that the Special Commissioners have a power of choice to bring certain people in, to tax them or leave them out, according, apparently, to their moral responsibility. This power also attaches to the Commissioners in the first instance. In another place in his speech, the Attorney-General definitely stated that the Amendment made mandatory what had hitherto been permissive powers to protect the taxpayer. Constitutionally, that is an intolerable position. It makes taxation depend not upon the will of this House but upon the opinion of the Board of Inland Revenue and of the Special Commissioners, and it is an opinion upon moral issue and not upon facts. There is no appeal for the taxpayer against that situation. It is true that the taxpayer can appeal on the purely abstract legal point as to whether he is inside the Clause or not, but that is not the point at which the Board of Inland Revenue have the choice. It is the people who are definitely inside the Clause to whom the Board can say, "We will tax you or we will not tax you." In other words, the whole basis of the strict interpretation and the strict definition of what is taxable and what is not taxable, has gone. As drafted, Clause 24 of the Finance Bill makes a very definite hole in the fundamental principle that this House lays down, strictly and precisely, what is and what is not taxable, and the House was perfectly right in protecting the interests of the taxpayer in insisting on the recommittal of the Bill and in making mandatory, instead of permissive, those powers to protect the taxpayer. I said that the principle of precise definition was in danger of breaking down, on account of the increasing complexity of our legislation, but Clause 24 was not complex. It was a comparatively simple Clause, as compared with many which we have passed on the subject of fax avoidance, yet in this comparatively simple Clause there was laid down, or it appeared that it had been laid down, the principle of the right of the Board of Inland Revenue to decide who should and who should not be taxed. I am afraid that is evidence of a tendency that has been growing up for some time. The evasion Clauses that we have passed in past Finance Bills are so wide that I am not at all certain that they are workable, except as a result of a good deal of discretion on the part of the Board of Inland Revenue. In fact, it almost looks as if this principle of precise definition had already become a fiction and as if, behind the façade, there was taking place taxation according to the opinion and the discretion of the Board of Inland Revenue. If that is so, we have to recognise the abandonment of a fundamental principle of our legislation. If we are to abandon the old principle of precise definition we should do it openly, and we should substitute for it something sounder, and more in accord with the past than Departmental decisions and interpretations of the law. We have already set a useful precedent ourselves in the Finance Bill of 1927 where we have used the phrase, "fictitious and artificial transactions." We have laid it down that certain fictitious and artificial transactions do not enable the taxpayer to avoid taxation. The question of what is a fictitious and artificial transaction is referable to a court of law. It is not something against which the taxpayer has no appeal. He can have an independent judge to decide the question. I suggest that it is along those lines that we shall have to meet tax avoidance in the future. Let us recognise that precise definition is breaking down, and let us, therefore, take steps to frame our legislation so that we can at any rate retain the protection which this House has given to the taxpayer through the centuries, against the Crown or the representatives of the Crown. Let us adapt our legislation in such a way that the taxpayer has some protection against decisions and interpretations of the Executive. As a matter of fact, if the Chancellor of the Exchequer will adopt the method of declaring that all artificial and fictitious transactions shall not enable a taxpayer to avoid tax, he will go a long way towards killing future tax avoidance. Suppose we have a simple Clause in the Finance Bill that all fictitious and artificial transactions should be null and void against the Exchequer, that would probably be sufficient. It would take away from the tax avoider a great advantage which he has at the present time, in that he gains two or three years' freedom from taxation by these transactions. To establish these complex schemes that are now necessary is not a cheap matter but it may be cheap in comparison with the gain of two or three years freedom from tax until the Exchequer has stopped up that particular hole. If the Board of Inland Revenue were in a position to say—subject to an appeal to the Courts— "This is an artificial transaction and we shall not allow it," the tax avoidance would be stopped immediately, for the schemes would no longer be worth while. The sooner we put our tax avoidance machinery on this basis, the better it will be for the Exchequer. And we shall not need to keep such a careful eye on the Chancellor and his Clauses to see that the innocent are not going to be made to suffer with the guilty."Of course, it was never my right hon. Friend's intention that the Special Commissioners should use this drastic power of joint and several liability to bring in, as responsible for the major sum or any substantial proportion of it, persons of this kind."—[OFFICIAL REPORT, 29th June, 1943; col. 1492, Vol. 390.]
This is one of the few occasions on which we can review our system of taxation and collection as a whole in this House. There are two or three small points which I should like to raise. The Financial Secretary has stated that we are ready payers of taxes in this country. That is a most fortunate thing, and one upon which we can congratulate ourselves, but it should be a matter of very careful conservation. I think that readiness of payment depends very closely on the justice and equity of the method and also on the quality of the provisions of the Bill. In that respect I want to reinforce various appeals that have been made for greater information regarding the statistical position on which our finances are based, so that there may be a closer understanding of the position as a whole. It is quite clear, I think, from the remarks, for instance, of the hon. Member for Ipswich (Mr. Stokes), who I see is not in his place, that there is a considerable lack of grasp of the principles of finance in certain quarters. But the difficulty that is most pressing to my mind is that of the very small taxpayer. In the cases that are apt to occupy the attention of this House, complexity is great and the machinery for dealing with them is great. It is true that the accounting system of this country is working under a tremendous strain, and I think the Chancellor might well appeal to some of his colleagues to ease up the strain on the accountants of the country so that the taxation position might be more closely regulated and more quickly arranged. But the small taxpayer has not a good grasp of the taxation system as it stands, and indeed it is too complex for his ready understanding.
I wonder whether a greater clarity might not he achieved, even under the present system, though I should support what has been said from the opposite benches, on the value of a far more simple system, though I think it would not be in Order to discuss that to-day. But the collection is based on a system very carefully set up which has lasted years and based, as the last speaker has said, on the need to protect the taxpayer in every possible way. There is another point on that I wish to make. I hope the Chancellor will arrange to avoid, as far as possible, not only retroactive legislation, which is a most unfortunate thing when it is forced on us by particular cases of evasion, but also the frequent attempts of the Inland Revenue to upset the decisions of Commissioners by appeals to the higher courts. I think the Chancellor should be very chary of applying the great power which is behind him, to wearing down what might be a genuine case of uncertainty, or even injustice, by saying, "If you appeal there will be another appeal and another appeal and in the end, if you win in the House of Lords, there will be retroactive legislation to defeat you in the end." There may be cases of justice among such appeals. No one, I am sure, wants to protect the avoider, and particularly the avoider who has evil intent. But it is most unfair, I think, to ascribe to those who dislike this retroactive legislation, any idea that they are out to protect malefactors. There is one other point to which I should like to refer. Allowances for expenses, particularly in the smaller cases, are, I think, a matter for sympathy and inquiry. I agree with the previous speaker who raised the question of expenses. It certainly is a difficulty that the legislation is not very elastic on these points. It is a misfortune that when we try, as is highly desirable and, as is the duty of this House, to define precisely what is the payable tax, the tax surveyor is apt to apply that, even on the most stringent points, to dubious cases and therefore to introduce a sense of hardship which damages the reputation for equitable dealing of the Treasury as a whole. I hope therefore that the future may bring us some relief on these points. I would only say one other word. I should have liked to have noticed a greater sense of heaviness of heart on the part of the Chancellor, in introducing this Bill. After all, it does carry into hundreds of thousands of small homes the greatest trials and anxiety and difficulty. It is a burden which is very readily borne, but there is a feeling, I think, that these small taxpayers are burdened without any sympathy for their case at all. I feel that these small payers, who suffer in a thousand different ways by the special hardship of their case, might in many cases be helped and certainly would be cheered if they felt that there was greater recognition of the sacrifices they are making in the interests of the country and of the war.It is obvious that the Third Reading of this Bill is having a very smooth passage. It is also obvious that everyone is willing to contribute his part to the needs of the war. No matter what the cost of winning the war is, it is obvious that everyone is willing to do his part. I feel I must protest on one point. The Budget does less than justice to the most defenceless and the weakest section of our community, the old age pensioners, in so much as the tax on tobacco and beer has not been eliminated on their behalf. Although I suppose it is too late to do anything about this situation now, I ask the Chancellor, when he brings forward his new Budget, to take this matter into serious consideration, and to take care to deal with what a number of us consider to be a really grave injustice. That is the only point I wish to make at this time.
It is impossible to discuss the Third Reading of this great Measure without paying a proper tribute to the objects of it and for the lucidity and informative attitude of the Chancellor and the Financial Secretary on the passage of this Bill through the House. The fact that it is to-day having a smooth passage is very much due to the fact that the difficulties and the disabilities under which the House at first laboured have very largely been removed. I think it can be very justly affirmed that this Measure does give a general measure of justice to all sections of the community. There is, of course, that particular section, the poorest section who pay no Income Tax and who are also under the duress of indirect taxation. They are the most heavily taxed in the entire community. I referred to that during the discussions on the Budget, and certainly trust that that aspect of subsequent taxation may receive sympathetic consideration at the hands of the Chancellor. The burden is not only upon the individual but it is frequently upon the communities where that individual may reside.
The hon. Member for Chesterfield (Mr. Benson) has certainly given us an entertaining dissertation upon tax avoidance. He seems to be a great expert in tax avoidance, and I have no doubt that his adumbrations to-day will be of the greatest value, certainly of interest to the tax avoiders of the future, and even to the more bold section who are tax evasionists. I disagree with the outlook and the attitude signalised by the hon. Members for Ipswich (Mr. Stokes) and East Middlesbrough (Mr. A. Edwards) in their condemnation of local war savings efforts. I have participated in quite a few of these. I must say that I believe the results of each have been an improvement in the standard of the morale and in the general outlook of the community concerned, but they actually have a valuable psychological effect upon those concerned. It certainly is a great and unifying factor. To me and my fellow citizens and constituents these war savings efforts have proved to be new and entertaining occupations. We have inculcated the habit of saving, which is a valuable one, and we have also obtained money which need not have been subscribed to the State, which might have been left uninvested or invested otherwise. I am glad to learn, speaking from some knowledge of industrial matters, that we are to have some further review of the Excess Profits Tax. Industry in many quarters and in many directions is awaiting some light upon that position, when it is evident, I think, that a stimulus will be available, probably, which is not available at the present time. No one knows how speedily the war may come to a conclusion, when industry must gird itself for the difficult periods which are coming. The State to-day is, and increasingly will become, a participant in industry. It is concerned and must be concerned not only with a maximum production but a maximum and more equitable distribution of the nation's wealth. It follows therefore that planning in finance and industry is inevitable. The longer the delay in recognising that fact, the worse it will be for the State. We have been informed to-day that the Chancellor is a 50 per cent. shareholder. More than that, he is an extortionate shareholder; he takes extortionate profits from industry. We can only hope that when the war ends he will be content with 20 or 30 per cent. profits, instead of 50 per cent., as at present. If we are to be permitted to fulfil the Atlantic Charter, among our other obligations, we must do more planning than in the past. We shall require a forecast of the needs of industry, such as is given in another great country. We should be able, through the financial power of the Treasury, to know, for a period of perhaps two or three years, what will be the State's financial liabilities. I hope, too, that there will be some solution of the problem of "pay-as-you-go." It may appear to many in this House rather a minor matter, but in the industrial field, and particularly the mining field, it is very serious. It has been the means of preventing overtime and Sunday work. It has created a sense of injustice, which has militated against a maximum production. So I hope that the Chancellor, who has now had some months to contemplate the situation, will at last come to a speedy settlement. I am satisfied with the financial condition of the country to-day, and, whether the war terminates early or late, I feel that there is a sense of hopefulness and perhaps even of satisfaction, that the future, to which we have made great promises, may be not altogether dark. With the Chancellor pursuing such a course in future as he has done in the past, we trust that these years will find us able to meet in every particular the obligations resting upon Parliament, upon the State, and upon the general community.I will not detain the House more than five minutes, although I think it is a pity that this undue haste has been occasioned because two very important matters have been put down for the same day. I will confine myself to one topic, which has been referred to by my hon. Friend the Member for Consett (Mr. D. Adams), this question of the collection of Income Tax as the income is earned. I do not think that the Chancellor fully appreciates the magnitude and urgency of this question. I am told that the Treasury are inclined rather to sniff at it. If that is so, what Mr. Belloc said of the University of Oxford must be true of the Treasury officials, and I fear that the Chancellor:
If he would let these learned men break out of the fence and come down to the factories they would find a very clamant state of affairs. It has been my duty during this war to have a good deal to do with workmen in factories on war production. I know, as all Members who have to do with factory life know, that this question of Income Tax arrears is a principal topic in every workshop conversation and a primary consideration at every production meeting. Every project and every programme is now considered in terms of its effect in terms of Income Tax. My hon. Friend the Member for Hemsworth (Mr. G. Griffiths), with his remarkable first-hand knowledge of mining conditions, tells me some most painful stories of the position of miners in his pits with regard to Income Tax arrears. I am sorry that he is not here. He tells me of one man, with £38 of Income Tax arrears, who has fallen sick, and whose recovery is retarded by the perpetual worry of this situation. I am very disappointed that the Chancellor has not found it possible to produce some solution of this problem before the final reading of the Finance Bill. He has before him the experience of other countries, not perhaps entirely applicable to us, but at any rate forming the basis of some investigation and some amended proposals. I will not keep the House now, but I beg the Chancellor to let us have at an early date, in the form of a White Paper, the facts and a considered view of the problem. It is said that any "pay-as-you-go plan" will involve the Exchequer in forgiving some portion of the accumulated Income Tax liability. I hope that that consideration is not a major barrier. If we are to come down from over-time working to normal hours, one way or another, this Income Tax will not be collected. If it is not going to be collected it is much better that it should be forgiven as a matter of deliberate policy, rather than allowed to peter out in a slovenly non-payment of the debt due. The moral and industrial effects of that would be very far-reaching and undesirable. I ask the Chancellor, once again, to let us have at an early date, in the form of a White Paper, his views, after due consideration, so that we can have a Debate in this House to determine the matter. I am certain that this one question has grown so large as to be a major factor in full production."keeps within a kind of fence or pen A lot of very learned men."
The Clause by which I think this Bill is most likely to be remembered is Clause 24. It has been referred to frequently, both with approval and with disapproval, but I do not think that all that ought to he said on it has yet been said. When it was last before us there were Government Amendments, which were objected to from two angles. One was that they freed from liability professionals who were obviously in the game: they were aiding and abetting, if not instigating, the schemes of avoidance, and they were freed from liability which might have attached to them under the original Clause for extra taxation on the normal profits that they would derive from that professional activity. To that some of us objected. On the other hand, it was objected that the Amendments did not free shareholders who were undoubtedly innocent of any complicity in these transactions. The Attorney-General made an ingenious defence of the Clause. He said that it was attacked by some as going too far, and by others as not going far enough, and some thought it about right. It was, therefore, probably not far wrong on the whole. That reminded me of the pleasant old story of a retired K.C., who was asked his view as to the efficacy of his advocacy during his long life. He replied, "In my youth, as a novice, I lost cases which I ought to have won, and in my old age, with experience, I won cases which I ought to have lost. So, on the average, justice was done." This Clause is a precisely similar average-justice Clause. No doubt, the professionals who have escaped liability will be satisfied with the Amendments, but I do not think that the innocent shareholders will be equally pleased.
I had an interview recently with a shareholder, who came to me with what seemed a very hard case indeed. He had received from the directors of his company an offer, to buy his shares at a price which had not attracted him. He thought that the transaction was a normal merger, that some larger competitor was taking over the smaller company. He began by refusing the offer. It was only when he found that he would be left in a small minority, that he realised that it was advisable for him to sell. That man had committed no offence of any kind; he had reluctantly accepted an offer which the directors had put before him. The people who were to blame were obviously those who had concealed from him the real reason for the transaction. But because of Sub-section (4) (b), he finds that a year after that transaction was completed he is liable to be called upon to refund a considerable amount to repay the Excess Profits Tax that should have been paid by other people. I mention this case because, as the Chancellor knows, I have consistently supported this method of retrospective legislation to kill avoidance of tax. It seems to be the only effective weapon in the armoury of the Treasury, and it is just because I want that weapon kept bright and effective that I ask the Chancellor to be exceedingly careful how he uses it. If the Clause is so administered that innocent people suffer and we have to raise cases on the Adjournment, we shall be reluctant to give the Chan- cellor similar powers in future. It is because I want this weapon, which seems to me essential, to be relied upon by the public to do justice, that I ask the Chancellor to be exceedingly careful not to administer it in such a way as to cause hardship to innocent persons.I am not getting up to sympathise with or apologise for those people who are called tax evaders and tax dodgers, but I am going to renew and emphasise the claim of those people who want to pay their taxes but to pay them in the easiest possible manner. I am sure that the Chancellor of the Exchequer will be almost wearied in hearing the appeals from various Members in this Debate and in the Debates on the Budget for the "pay-as-you-go" method. My hon. Friends the Member for Leigh (Mr. Tinker), the Member for Consett (Mr. D. Adams), the Member for Hemsworth (Mr. G. Griffiths), the Member for Barnsley (Mr. Collindridge) and other hon. Members have put forward the plea that something should be done to try and mitigate the hardships which the workers now have to bear. I am not speaking for the miners, although I speak for many of them, but I am speaking very largely for agricultural workers and men who work in quarries and whose work is seasonal. In the winter-time the outdoor workers make less wages, and in the summer-time their wages are higher. In the winter six months when the wages are low they have to pay a higher Income Tax based upon the amount when their wages were high. Surely some method can be evolved—some method has been evolved in some countries—to evade this difficulty, and I hope the Chancellor of the Exchequer, after hearing all the appeals that have been made during Debates on the Finance Bill, will take into account those earnest and sincere appeals and try to bring forward something in the future to remedy that evil. After all, the Chancellor of the Exchequer is the loser in some cases. As my hon. Friend the Member for Hemsworth said, if a worker dies, then Income Tax for the previous six months dies with him.
There are questions I want to ask the Chancellor. What is the position of wage-earners who are called to the Forces and have hanging round their neck the debt of unpaid Income Tax? Will they be expected to pay that tax when they return to employment, if they do return? I should like an answer to that question, as it has been put to me a number of times in my Division. There is another question which is causing great concern among the workers. At the end of the war, if they be unemployed and have a debt of Income Tax, will the post-war credit be taken, either wholly or in part, to liquidate that debt? Those questions are causing very serious concern among the workers, and I hope that the Chancellor of the Exchequer will give an explicit reply to-day on these matters. "Pay-as-you-go; present wages should bear present taxation," is the motto that he should adopt. If he would give me an answer to these questions and some assurance that the method of levying Income Tax on wage-earners will be eased somewhat so that the anxieties and hardships are removed, I shall be satisfied.rose—
On a point of Order, Mr. Speaker. Am I to be called?
The Chancellor of the Exchequer also rose, and I called him.
I am very much obliged to the Chancellor of the Exchequer for giving way. It is some two months since I spoke in this House, and I want to contribute some observations on the Budget from a different point of view from that from which most of the contributions in this Debate have been made. As far as I know, nobody up to now has challenged the broad structure of the Budget. Individual Members have expressed regret at this or that. Hon. Members have made this, that, or the other proposal, but nobody has challenged the Budget as a whole. That is precisely what I wish to do. I wish to challenge the structure of this Budget as a whole, before it leaves this House for good and all: I wish to say of it (1) that it is an irrelevant Budget, (2) that it is an unjust Budget, (3) that it is a silly Budget and (4) that it is a Budget which envisages either the alternative of debt repudiation, or the denial of any hope of a "new Britain" after the war. Those are the four points.
I assert, first, that it is an irrelevant Budget. We have had this Budget com- mended to us by the Chancellor of the Exchequer, and by the Financial Secretary, on the ground that it is through the Budget that we pay for the war. We are told that the Budget is the measure of the sacrifice that the people of this country have to make, in order that this war may be financed. It is time that somebody said bluntly that that is arrant nonsense. In time of war the Government control all the essentials of making war. The Government control——I am afraid that the hon. Member is now getting outside the provisions of the Third Reading. He can discuss on the Third Reading what is in the Bill. The considerations which the hon. Member is now putting seem to be very appropriate to a Second Reading speech but not to a Third Reading speech.
I must obviously accept your Ruling, Mr. Speaker, but it was in my mind to say that I do not think we ought to leave this Bill, even on its Third Reading, without declaring what we think of it. I do not want to contravene your Ruling, Sir, in any way, hut I wish to say, and I hope it is in Order, that the premises on which this Budget rests are wrong. The premises on which it rests are that the war is paid for in terms of units of value, pieces of paper, pieces of coin, and the rest of it, which have no relevance whatever to the waging of the war. When the Government control, as they do, labour, material and everything else, it is idle to pretend that our war effort is to be measured by the size of the Budget. That is my first point.
I say next that it is an unjust Budget. In spite of all the appeals that have been made to the Chancellor of the Exchequer, the treatment of the various categories of pensioners in this country remains as it was when this Budget was first introduced. Let us take a look at these categories of pensioners, because they are going to bear the burden of this Budget without relief. There are first the several categories of State pensioners, police pensioners——The hon. Member cannot discuss police pensioners under the Finance Bill.
I would respectfully submit that it may not be out of Order for me to refer to categories of pensioners on whom the taxation levied by the Budget will fall.
The hon. Member may refer to categories, but he must not discuss details of these cases.
I have not the slightest intention of so doing. I wanted to point out that, apart from old age pensioners, there were other categories of pensioners, Civil Service pensioners, prison officer pensioners, local government officer pensioners, teacher pensioners and other Government officers, to whom the Chancellor of the Exchequer has refused any kind of relief since this war started. He has given them even less consideration than the old age pensioner, and goodness knows, the old age pensioner has had little enough. Upon these the burden of the taxation proposed in this Budget is to fall. I say that in the case of the old age pensioner it is to take away with one hand what you give with the other. In the case of other categories of pensioners it is to take away where you have not even given any relief at all. If the Chancellor of the Exchequer can sleep easy in his bed when he thinks about these categories, his conscience must be such as to justify his appointment as Chancellor of the Exchequer.
I say next that it is a silly Budget, a Budget which dodges every problem of the future, which the Chancellor of the Exchequer ought to be envisaging. When this war ends, if the precedent of the last war is followed, there will be a sharp diminution in the wage earning capacity of the civil population. I do not pretend to know how much that diminution will be, but I do know that if, in the year which follows this war, the Chancellor imposes taxation on the working classes based upon earnings of the year before the war ends—in other words, if he imposes high taxation at a time of low income—then, believe me, he is heading for a first-rate industrial crisis in Britain. If no other consideration would move him, in regard to applying taxation of income as it is earned, that consideration ought to appeal to him, because if he does not do this he will get a mass movement of non-co-operation on the part of the wage earners in this country in the year that follows the war. I say, fourthly, that this is a Budget which foreshadows either repudiation of debt, or the denial of any hope of the "New Britain" which is held in front of the eyes of the masses in order to induce them to contribute their best to the war. We have been told that the National Debt to-day is £17,700,000,000. I do not know how long the war is going on, but we appear to be adding to that burden of debt at the rate of approximately £3,000,000,000 a year. I was informed by a Government Whip the other day—and who am I that I should question his authority?—that the Government were working upon the assumption that the war would continue in Europe for another four years. I do not pretend to know how long the war will last, but on the basis that it continues for another four years the National Debt will have risen to something like £29,000,000,000. Even at 2 per cent., which the Financial Secretary gave as the average cost of the debt incurred in this war, a National Debt of £29,000,000,000 would require the whole of the pre-war Budget to service it. What does that mean? It means one of two things—either that the Treasury deliberately intends to inflate so that it pays back that debt in pounds of a lower value than the value of the pounds it was contracted in, or, alternatively, that any dreams of the Beveridge Report—education up to the age of 16, a minimum wage in industry, and all the other things which have been put before us—become completely impossible from a financial point of view. We know what the Government intend to do, but they have not got the courage to say it. What they intend to do is to indulge in a measure of controlled inflation; they intend to inflate the present value of the pound to the tune of 100 per cent., in order to try to keep the postwar cost of servicing the war debt within something like manageable limits. If they do that, they defraud everybody, who has put £1 into War Savings, "Wings for Victory" Weeks, or any other kind of national saving. If they do not do that, then they must face the other horn of the dilemma—that within the limits of this debt-ridden society it will be impossible to get a large enough Budget to service the National Debt, and at the same time make good the promises that have been made to the people of this country during the war. That is the inescapable dilemma which confronts the Chancellor, and I would not mind betting very heavily that when the right hon. Gentleman comes to reply to the Debate, he will do his best to avoid either horn of that dilemma.
Which horn would the hon. Member grasp?
The horn which would be probably carefully avoided by the hon. Member, who walks on a tight-rope as perilously as any Member of this House. I should choose the horn which faced up to the whole problem of this debt-ridden, bank-ridden society——
Repudiation?
The hon. Member makes a fair point. This side of the House of Commons has been attached to the system of the other side of the House of Commons in the role of a junior partner long enough. It is incredible that a man of the intelligence of the former Under Secretary for Air——
We must get back to this Bill.
I am sorry, but my conception of a controversy has always been that when one Member is allowed to interrupt, it is not unfair for the hon. Member who is speaking to be allowed to reply.
An hon. Member may interrupt, but that does not necessarily mean that the hon. Member who is speaking may make a reply at great length.
I do not think that charge can be laid against me, Sir, as I had only started to reply.
I think the hon. Member had replied at enough length.
In that case I will not attempt to continue with my reply. My own grasp of the horn of the dilemma is that I hope these inflated figures of the National Debt will bring this country where it ought to have been long ago, namely, to the position of assessing the function of money in the community, and to answering the question as to whether industry ought to serve money, or money ought to serve industry and humanity. When we come to that conclusion, we shall not be discussing a Budget that operates within a financial system such as now exists in this country, and there will be no need for Front Bench speeches such as that which we had from the Financial Secretary earlier to-day. We shall be dealing with money as the servant of man, and if the breakdown of the Budget which I clearly foresee, as the alternative to debt repudiation, produces that result then even the experience of this war will not have been in vain.
First I would like to thank the House for the kind observations they have made concerning the Financial Secretary and myself and I would also like to thank Members for their co-operation with the Treasury and myself in connection with this Bill. I propose to say a few words on some of the major points which have been raised in the course of the Debate to-day and I will, if I may, communicate with other hon. Members regarding the smaller points which perhaps they will excuse rite from answering to-day owing to the pressure of other business. It is hardly necessary for me to do so, but I would like to commend what was said by my right hon. Friend the Member for East Edinburgh (Mr. Pethick-Lawrence) and others concerning the generous assistance which has been given to this country by Canada and America. I endeavoured in the course of my Budget speech to draw attention to the magnificent contributions of these two countries but I do not think we can too often express our gratitude for their wide and large-minded attitude which has been and is of such help to us to-day. I can only hope that such assistance as we are able to give in return—for instance by reciprocal aid—is proving helpful to Canada and America.
This, I think, is the sixth Finance Bill since the beginning of the war and while it is true that no financial fortifications are impregnable and that complacency is as dangerous in this field as in the military field, we can, I think fairly claim that after four years of unprecedented strain, our financial front stands strong and firm. I do not think it is too high a claim to make that British finance has played a vital part in, and has made a potent contribution to, our war effort. As regards what the taxpayer has done, it can be said—and I would be the first to say it—that we have not spared ourselves. Our object has been to pay for the war as much as we can, as we go along. This year our Budget expenditure will be over eight times what it was 10 years ago and our total expenditure since the war began is already double what it was during the whole of the last war. The amount to be raised in taxation this year is over three times the amount raised in 1938 and is half as much again as the total amount raised in taxes during the last great conflict. We have borrowed a sum more than the whole of the National Debt before the war began. One of my hon. Friends rather suggested that I did not pay sufficient tribute to what has been done in this respect by the community. Nobody appreciates it more than I do; in fact last year taxes of all kinds took just under 40 per cent. of all private incomes. The average citizen paid about one-third of his entire income mainly to support the fight for freedom and civilisation. This contribution, of course, has not been borne by any one section of the community. All have made sacrifices and in my judgment that is why these heavy impositions have been generally supported and have received such universal approval. It is a real test for our democracy and the response and cooperation of the whole country have not been found wanting. I certainly realise the unprecedented changes which have taken place in our taxation affairs. There have been many drastic adjustments in many people's lives. Take, for instance, the so-called rich. They have certainly paid very heavily and it should be said on their behalf, and by me, that they have not complained or whimpered. There has been some discussion about the 100 per cent. Excess Profits Tax, about which I will say a little more in a few minutes, but the whole idea behind this tax was to take the profit out of war. There are now some 12,500,000 direct taxpayers—not 7,000,000 as one hon. Member said—and of this number, some 10,000,000 belong to the smaller Income Tax groups. Weekly wage-earners, black-coated workers and others, are not only making a considerable contribution to the war effort but it certainly can be said that at no time in our history have so many of our citizens had a direct and vital interest in taxation matters as they have to-day. Further, out of every £1 we have to spend this year we shall have to borrow 10s. in one form or another. Although we have this vast number of taxpayers it is a remarkable fact that as a result of voluntary savings during the war, a capital sum of £2,000,000,000 is now in the possession of the "small" men and women. That not only indicates a profound change in the circumstances of the time, but it will undoubtedly have a great effect on our policy and plans after the war. Certainly one of the great duties of the Government and the Chancellor, whoever he may be, must be to maintain economic stability, even if only in the interests of the small men and women, who now have such a vital stake in our national affairs. It is most important, of course, from their point of view, and from that of other citizens, that that particular side of our financial affairs should always be present to us. Taxation takes its place and Indeed an important place in the measures we have taken to secure economic stability; the development, for instance, of a vicious spiral of wages chasing prices would not only weaken the war effort and cause unsettlement and anxiety among the workers, but it would very seriously threaten economic Stability. I need only recall the events of the last war and the disasters which then overwhelmed us. I am very anxious to emphasise the necessity of carefully watching the position —this is the duty of the House, as well as of myself—because I am sure no one desires to see a repetition of what occurred during the last war. I fully appreciate the desire of all who have spoken to impress upon me the necessity, if it is at all practicable, of adopting some system of "pay-as-you-go" I have never for a moment endeavoured to controvert the advantage of such a system if it could be properly and fairly introduced. I have told the House on other occasions that I have been in constant touch with the Trades Union Congress and the Employers' Federation, who have the same desire as Members of this House, and it is only because, at any rate up to a little time ago, no practical scheme had emerged which in the judgment of those two great organisations and myself would have been fair and practicable that no scheme has yet been introduced. It has not been any wish to hinder a measure which would obviously bring a great deal of relief and advantage if it could be introduced. It has simply been that in the judgement, not only of myself but of those two organisations, as I explained in the White Paper at the time of the last Budget, no acceptable scheme had been brought forward. I would invite hon. Members to read that White Paper again, which shows some of the difficulties with which we are confronted. If one follows the course of events in America and Canada, one will see that it is not by any means easy going. I am still hoping to obtain some material on the proceedings in America which I will make available to Members as soon as I can obtain it, though, of course, conditions in America are obviously somewhat different from our own; I hope, perhaps in the early autumn, to make a further statement. I have not given up hope that some reasonable scheme can be devised. I have always said that, if it can, I believe it will come from people who are experienced and have been working on taxation matters for so many years. My hopes lie in that quarter more than any other, because, if it is at all possible, they are the people who can make suggestions which will be of value.Are we to understand that my right hon. Friend is giving his attention to what has been done by the Canadian Government?
I have been studying more particularly the American plan. It is very difficult indeed to follow what has taken place from the newspapers, and I have been trying to get further information.
The hon. Member for Leigh (Mr. Tinker) and others asked me about Post-War Credits. I am disappointed that the hon. Member has not had the information that I thought he would have had, because, at considerable expense, and by the use of a great deal of labour, we issued to every taxpayer an explanatory leaflet with the Post-War Certificate. He apparently did not get that. I must consider what further efforts I can make, and I will also consider what can be done by way of broadcasting so, that the matter can be more fully understood.I hope the right hon. Gentleman will follow up what he has said. I do not remember receiving any explanatory note.
We will make further efforts, because it is important that the position should be more widely known.
Will the right hon. Gentleman say something about the deduction of arrears of tax from the Post-War Credit? Many people are worried because they fear that, if they fall out of employment, arrears of Income Tax upon high earnings in the past may be deducted from Post-War Credits.
I have given a very definite undertaking on that matter. I will send the hon. Member the exact terms of it.
It has been represented there is still doubt about the 20 per cent. return of Excess Profits Tax. I cannot understand why there should be any difficulty or confusion, unless it has been caused by statements other than my own, because it is quite definitely laid down in the Statute so far as it can be done before the conclusion of hostilities. I do not think, at any rate at this time, anything can be made more binding on the State than the provision that we have made. I will also carefully study what my hon. Friends the Member for Walsall (Sir G. Schuster) and Stockport {Sir A. Gridley) have said in relation to the position of trade and industry. I think they made two valuable contributions to the matter. I thought the most practical measure would be to have an exact investigation into the matter by the authorities concerned. That investigation has now begun, and my advisers are now engaged in measuring the field and in consulting with a number of bodies representative of industry. It is of importance that it is not only an inquiry by the Board of Inland Revenue, but by representatives of the Board of Trade and of the Treasury as well.Reverting to the question of stability and the 20 per cent., I hope my right hon. Friend will recognise that no responsible set of accountants would put down any part of that 20 per cent. on a balance-sheet. [An HON. MEMBER: "They ought to."] I give them credit for knowing their own business best. It is obvious that my right hon. Friend has not made himself sufficiently definite and clear to enable them to do so.
It may very well be that, when we approach the conclusion of hostilities and can make definite plans, we shall be able to make a more precise statement.
My right hon. Friend spoke of consulting bodies representative of industry. I hope he is also consulting bodies like the Institute of Chartered Accountants, which represent no industry but have a great volume of expert knowledge on these matters.
I am glad to answer that. I had an opportunity of talking with the president of that body, and I am very grateful for the suggestions they have already made. My hon. Friend can take it from me that we shall value very much any information or co-operation they can give us.
Will the right hon. Gentleman say a word in relation to agriculture, in regard to depreciation of machinery and stocks?
I would refer my hon. Friend to what I said on the Second Reading of the Bill. I would not trust my memory to repeat it now.
In regard to the savings movement, I am most anxious that the House should continue to give their help to the great work that that movement has undertaken. It has been one of the most successful efforts in our time, and when the history of the war comes to be written one of the matters that will certainly always be referred to will be the wonderful effort made by the people in voluntary savings. My hon. Friend the Member for Ipswich (Mr. Stokes), who is not now in his place and who likes to have a little tussle with me, seems to think that there is some mystery about the savings movement and the amount of small savings. One of the finest things about the savings movement during the last 12 months has been the considerable improvement in the small savings. I am glad to be able to tell the House that the total of small savings in the last six months was 25 per cent. higher than in the same period of 1942. I will gladly send my right hon. Friend the Member for East Edinburgh exact particulars of the small savings and the large savings which have been obtained up to date in the "Wings for Victory" weeks. My right hon. Friend the Member for East Edinburgh also asked about the position of post-war currency, which we discussed at considerable length recently. The position at the moment is that in Washington there have been certain meetings of a purely exploratory nature in which certain experts have taken part. The official representative of the British Treasury who is stationed in Washington and others who happen to be there have from time to time attended and discussed the two papers which we know as the British Paper and the American Paper. They have discussed them in the light of the Debates that have taken place in the House of Commons and in Congress. These expert discussions will doubtless continue, and I cannot at present make any further statement except that I think these discussions are of value, and I hope they will continue. I repeat the undertaking that I gave that there will be no commitment of any kind entered into by the British Government without one and possibly more discussions in this House on this matter, which, of course, is of tremendous importance to our future. The House can rest assured about that. The matter is still on the official level, and no Governments are being committed by these discussions. When opportunity serves and there is anything further that I can usefully say to the House, I will do so, and I will keep the House informed from time to time how the matter is proceeding.My right hon. Friend says that there will be no commitments. I take that to mean that we shall not be brought together to have a statement embodying some proposed arrangements which we must either take or leave. Shall we have an opportunity of discussing it before it becomes crystallised?
I think I can safely say that, but the matter is not advanced to anything like that extent yet. I must preserve the right of the Government constitutionally, but I do not think my right hon. Friend need have any anxiety that there will not be full opportunity for discussion.
Will my right hon. Friend go as far as to say that he agrees in principle that there should be one currency scheme and not two schemes and that he will incorporate into the scheme the best that each has to offer?
I will not go further than what I have said. I have only myself explained the scheme to the House and have not pledged the Government or myself to any particular course.
I want to say something, in conclusion, about the avoidance of taxation and the provisions that we have made in this Bill against a particular form of avoidance of the Excess Profits Tax. Efforts were made to sell pre-war stocks of whisky at the high prices now obtaining without incurring liability to Excess Profits Tax on the profits resulting from that transaction. I want to say a word or two generally on the subject of the avoidance of taxation. Tacitus recorded of the inhabitants of Britain that they were good taxpayers unless they were exasperated by official insolence. That is true to-day. There never has been a time when the British people have paid their taxes so willingly and promptly, and there has been nothing like it in financial history. The Excess Profits Tax has been in existence over practically the whole field of industry, and the Exchequer has again benefited from the traditional willingness of the British taxpayer to pay. Industry for their part—I am glad to say this—have generally regarded the 100 per cent., whatever they may think of the merits, as a necessary part of the war effort. Whenever people have discussed this matter with me on behalf of industry, while they have had their criticism to make, they have never suggested that it should be resisted or not properly paid. From the outset of the Excess Profits Tax and in the years before we instituted the system of Tax Reserve Certificates, under which tax can be paid in advance and interest credits given, industry generally not only paid punctually what was due but even came forward and paid large sums in advance on assessment towards the liabilities that would ultimately fall due. In the years 1940 and 1941 the Exchequer received no less than £20,000,000 and £80,000,000 respectively by way of advance payments before assessment. The general experience of the Commissioners of Inland Revenue is that industry willingly faces its heavy tax bill in the same way as the ordinary citizen willingly meets his individual liability. I should not be treating the House with candour, however, if I did not say, indeed it was apparent from the discussions that have taken place on this Bill, that unfortunately there are a few who seek to avoid contributing their fair share to the cost of this war. I know the House will agree with me when I say it is the duty—and this is my answer to some of my hon. Friends who have spoken to-day—of the Legislature, especially at the present time, effectively to counter the devious methods that may be adopted by such people to achieve what I regard as their unpatriotic purpose. It is true that the methods that are adopted may be within the letter of the law, but I suggest to the House that where they are plainly directed to defeat the purpose of the law, the law must be protected. In a recent judgment in a case in the House of Lords, the Lord Chancellor, referring to methods of avoidance, said:In a later case, which came before the House of Lords only a few weeks ago, in which the avoidance of taxation was again the issue, another Law Lord said:"Judicial dicta may be cited which point out that however elaborate and artificial such methods may be those who adopt them are entitled to do so. There is, of course, no doubt that they are within their legal rights, but that is no reason why their efforts, or those of the professional gentlemen who assisted in the matter, should be regarded as a commendable exercise of ingenuity or as a discharge of the duties of good citizenship. On the contrary, one result of such methods, if they succeed, is, of course, to increase pro tanto the load of tax on the shoulders of the great body of good citizens who do not desire or do not know how to adopt these manoeuvres. Another consequence is that the Legislature has made amendments to our Income Tax code which aim at nullifying the effectiveness of such schemes."
It is one thing for the taxpayer to see that he is charged no more tax than the law allows by reference to his actual circumstances, but it is quite a different thing for the taxpayer to enter into highly artificial and ingenious devices so as to make his circumstances appear to be something different from what they actually are, and it is this which lies at the root of avoidance of taxation. In pre-war years it was found necessary to pass a considerable amount of complicated legislation to defeat those who resorted to such methods. It has, happily, not proved to be necessary during the war, for the national purpose has undoubtedly been fortified by a spirit that recoiled from the employment of methods such as those we have been discussing during this Finance Bill. In relation to Excess Profits Tax, the amount of avoidance has certainly been relatively small; sufficient proof of this is to be found in the healthy attitude of industry as a whole. To check, however, any growth of the avoidance of Excess Profits Tax special provision was made in Section 35 of the Finance Act, 1941, under which the assessing authorities were given general powers to direct such adjustments to be made in the liability to the tax as to counteract any avoidance. When these provisions were before the House I pointed out that many of the past provisions dealing with the avoidance had been retrospective, and that people who wished to evade taxation—I said this very deliberately and definitely at the time—did so at their peril, for they might be dealt with retrospectively. The Financial Secretary repeated the warning. I should like to quote his exact words in the Debate on 1st July, 1941:"It was reasonably plain in that case that the taxpayer concerned was one of those persons who, rightly or wrongly, exercised much ingenuity in discovering gaps in the net spread by the Legislature and in so arranging their affairs as to escape, but that if the taxpayer saw no impropriety in doing so, it did not lie in his mouth to accuse the taxation authorities of impropriety in choosing to exercise their powers in such a way as to defeat his scheme."
Despite that warning, certain people have resorted to what I regard—and I stand by all I said on this matter on previous occasions—as an outrageous form of avoidance in the case of these whisky stocks. I do not think anybody can possibly defend it; it was, however, found that Section 35 of the Finance Act which I have quoted did not enable the Revenue authorities to recover the tax, and Clause 24 of this Bill carries out my promise that in such cases I would seek effective Parliamentary powers, while giving certain protection to those persons who have not been concerned in such nefarious transactions. The powers given by the Clause, while effectively dealing with the whisky racket, are, I would remind the House and the country, of such a character that ordinary commerce is untouched, for they only apply where a company sells its trading stock at less than its value to a person who is a controlling shareholder. This legislation which we are passing to-day implements the warning I gave in 1941, and I would only say that while I will consider any suggestions made in the Debate as to whether any further action is necessary—I hope it will not be—I trust that any people in future who still feel inclined to resort to such methods will take note of the warning I give. Whatever differences of opinion there may be, the great majority of Members on all sides of the House, while quite rightly desiring to protect the innocent—and it is right that we should do that and not allow our indignation to lead us to do anything unfair—will, I am sure, support me when I say that I shall not hesitate to come to the House again if necessary for powers to stop this sort of thing; I do not think it ought to be allowed at any time, but certainly not in war. It is for that reason that I have made this statement to the House to-day, and I am hopeful that people will take warning by it. It has been the main topic in our discussions, and I am very grateful to the House for the consideration they have again shown me, and thank them once again for the support they have given to the proposals. I think the proposals embodied in this Bill have received practically the universal acceptance of the country and I believe the main reason for that is that the country feels that I as Chancellor, with the House of Commons supporting me, have endeavoured to deal fairly by all sections of the community in the difficult circumstances of the time. It is too early to talk about remissions of taxation; no one can tell what lies in front of us. I feel that the way in which we have endeavoured to treat this Finance Measure, that is to say, not in any party or sectional manner, but with a view to doing what we can in the best interests of the community, is the way in which, in the future, our safety and success will continue to lie."There is also the Clause which we have just touched upon, with its very rigorous action against tax dodgers, and in that connection I will draw attention once again to what my right hon. Friend has said, namely, that if it is still found to persist in spite of these wide powers he feels himself at liberty to take more strict action, retrospectively, if necessary, because the one thing this House and the people will not tolerate is tax dodging in time of war."—[OFFICIAL REPORT, 1st July, 1941; col. 1282, Vol. 372.]
Question, "That the Bill be now read the Third time," put, and agreed to.
Bill read the Third time, and passed.
Foreign Service Money
Resolution reported,
"That, for the purposes of any Act of the present Session making further provision as respects the superannuation benefits of members of His Majesty's foreign service, it is expedient to authorise any increase in the moneys to be provided by Parliament for the purposes of the Superannuation Acts, 1834 to 1935, and the Superannuation (Diplomatic Service) Act, 1929, that may be attributable to provisions of the first mentioned Act relating to—(a) the grant of a superannuation allowance and an additional allowance to members of His Majesty's foreign service whose employment is terminated before the retiring age; (b) members of the said service who, after recall from an office abroad by reason of war circumstances, have served in a less remunerative office under the Crown (whether at the time of their recall they were members of that service or of His Majesty's Foreign Office and diplomatic service, commercial diplomatic service or consular service); (c) the circumstances in which former members of His Majesty's consular service in China are to be treated as if they remained members thereof for the purposes of Sub-section (1) of Section seven of the Superannuation Act, 1935."
Resolution agreed to.
Foreign Service Bill
Considered in Committee.
[Major MILNER in the Chair.]
Clause 1 ordered to stand part of the Bill.
Clause 2—(Superannuation Benefits On Termination Of Service Before Retiring Age)
I beg to move, in page 2, line 13, to leave out from "thereof" to "is," in line 14.
In the Debate upon the Second Reading, I intervened for a moment to ask the Secretary of State whether there was any particular reason why the provisions of this Measure should be confined so definitely to first secretaries as a class. My right hon. Friend replied that the matter had been considered by his Department and by himself and that, on the whole, they thought there was good reason for restricting this provision to the rank of first secretary, and they accordingly inserted it in the Bill. In the ordinary way that explanation would have been good enough for me, since my right hon. Friend has much greater knowledge of these matters than I have, and, after all, he has to operate this Measure. He did also say, as it were on second thoughts, that there might be some case in which it would be desirable to apply the Bill to second secretaries, because it might not be desirable to pro- mote a second secretary to the rank of first secretary, in order to apply to him the provisions of the Measure and retire him from the public service. Because of that expression of opinion, and perhaps also feeling that the hon. Lady the Member for Wallsend (Miss Ward), who took part in that Debate, was not so far from the truth when she said that other influences than those of the Department concerned had been brought to bear in this matter, I thought it would be useful if Members came to the assistance of my right hon. Friend and pressed the matter a little further. I hope that the right hon. Gentleman will take the Amendment in that spirit. It is obvious that there may be many cases in which it it desirable to retire a second secretary from the Service without having to promote him to the position of first secretary in order to do so. Some members of the Committee may have read the observations on that subject in a book—the study of which should be made a compulsory subject for any applicant for the Foreign Service—written by the hon. Member for West Leicester (Mr. Nicolson) who is, I am glad to see, in his place. Possibly Lord Bognor would never have got as far as he did, if it had been possible to apply to him at an early point of his career the principles of the Bill. Furthermore, there arises in this matter the question of Consuls. I understand that the Bill will apply to consuls as to first secretaries, but nothing is said with regard to Vice-Consuls. There is a widespread feeling that the Consular servisce needs to be raised in status and efficiency. Without lacking in recognition of the great services which the Consular Service has rendered in the past, I would not subscribe to the opinion that the Consular Service can be placed quite on all fours in prestige and status with the political gods of the Diplomatic Service. It seems to me there is a fair analogy with the Army's General Staff, and ordinary officers. The General Staff are concerned with long-term strategical planning, and that may endow them with a certain amount of prestige and status which cannot be enjoyed by people who are engaged only in the day-to-day work. In the same way the political gods in the Diplomatic Service are engaged in executing, and advising on, longterm political questions which do not fall to the lot of a consul. None the less, there is little doubt that the position of Consuls has not been as satisfactorily regarded either by the Foreign Office, by the public, or by this House as it is desirable it should be, and the power to remove a Vice-Consul on satisfactory terms is very desirable. I am sure that it is not the intention of the Foreign Secretary to litter this country with retired diplomatists of any rank and that the Department do not intend to use the Bill indiscriminately. The Bill is certainly permissive. Not one person may be retired under it in the next few years, but the Amendment would make it possible to retire not merely first secretaries but second secretaries who are not as efficient in their job as they might be—and not merely a Consul, but a Vice-Consul whom it was desired to remove from that position. Therefore, I hope that my right hon. Friend the Under-Secretary of State, in spite of his somewhat austere demeanour, will find it possible to embrace this innocent and agreeable little Amendment and to accept on behalf of his Department a proposal which will add nothing to the expenses of the country but may, in certain circumstances, be a useful implement for the Foreign Secretary to hold in his hand.My hon. Friend, as he always does, has spoken most persuasively, and his final appeal was, I think, calculated to melt an even harsher exterior than mine. Nevertheless, I fear that I cannot ask the Committee to accept his Amendment, and that I must ask the Committee to reject his Amendment, not because I dissent from the arguments which he has put forward, but because I think we can meet those points without going to the extremes which his Amendment demands. My hon. Friend had in the main two points. He said that there might be occasions when there was a second secretary of more than 10 years' service who really qualified for retirement under this Bill, and that if cases of that kind were found—I think they have been very rare in the past, and I am sure they will be equally, I would hope more, rare in the future—it would be a pity if the Foreign Secretary were unable to exercise the powers which this Bill would give him. I agree with my hon. Friend on that.
My hon. Friend then went on to speak about the position of Vice-Consuls, and he suggested that it might be desirable for the Foreign Secretary to retire on pension Vice-Consuls who did not seem to have those qualities which fitted them for more responsible posts. There again I would incline to agree with my hon. Friend. He said he imagined that my right hon. Friend the Foreign Secretary had no intention of littering the country with retired diplomats. That is perfectly true. No more has he any intention of littering the country with retired Vice-Consuls. But there is this distinction between the Consular branch of the service and the Diplomatic branch of the Service. In the Diplomatic Service it is very unlikely that a man would have got to any position of responsibility before he had reached the position of first secretary. In the Consular branch, on the contrary, it might well happen that a man who is Vice-Consul would have been in sole charge of an office somewhere, and there one would have a much better idea of what he was worth and what his capacity for shouldering responsibility was. It would seem to me therefore reasonable that my right hon. Friend should have the power to retire a Vice-Consul who, though he had done excellent work in a subordinate capacity, had shown himself to be unsuited, perhaps by temperament or for some other reason, for a position of the highest responsibility. I think it is reasonable that my right hon. Friend should have those powers. My hon. Friend in his Amendment goes much further than that, however. He does not want to limit my right hon. Friend's powers to second secretary and Vice-Consul, the two cases he mentioned. He wants him to have power—subject to the provision that a man has had to serve 10 years in the Foreign Service—to make, if he felt like it, a wholesale purge of the Service below the rank of second secretary and its equivalent of a Vice-Consul. I would like to make this suggestion to the hon. Member and to the Committee. If my hon. Friend would be prepared to withdraw this Amendment, and if the Committee were to concur in the course, I would move a manuscript Amendment substituting"… a grade not lower than that of second secretary …"
as the Bill stands now. I think if we were to adopt that course we should get the objective at which my hon. Friend is aiming and for which he argued in his speech in moving the Amendment just now."a grade not lower than that of first secretary,"
I am much obliged to my right hon. Friend. That seems to me to cover the point I made. I take it that "Vice-Consul" will substitute for "Consul"?
That is so.
I beg to ask leave to withdraw the Amendment.
Amendment, by leave, withdrawn.
I beg to move, in page 2, line 13, to leave out "first" and to insert "second."
I have just explained to the Committee the reasons for this Amendment, and I do not think I need detain the Committee with any further explanation now.Amendment agreed to.
I beg to move, in page 2, line 25, at the end, to insert:
I apologise to my right hon. Friend because of the fact that this Amendment appears on the Order Paper, as it would not have done had he been able to get his Bill through on the day he had hoped. But the more I study the Bill the more my doubts increase about the wisdom of some of its provisions. I hope at least that the effect of putting this Amendment down will be to make hon. Members, including myself, realise the implications of this Bill. It is rather appropriate that it should follow on the Third Reading of the Finance Bill, and I hoped that the hon. Member for The Wrekin (Mr. Colegate), who has expressed his dismay that there is no support for the protection of the public purse, might have helped to protect the public purse on this occasion. What will happen under this Bill? A first secretary receives an initial salary of £800 a year. If he is retired after 10 years' service, that means that he will, get an annual pension of £100 a year and a lump sum of £300. In the Debate on the Second Reading of this Bill the right hon. Member for Mitcham (Sir M. Robertson), whose words are almost as authoritative as those of the Foreign Secretary himself, said:"Provided further that in the case of members of His Majesty's foreign service whose employment is terminated before the retiring age in a rank not higher than that of counsellor, pension shall cease to be payable after twelve months."
Those words might give the impression that this pension is only to tide over the period in which the man retired from the Foreign Service will have to live until he can find another job—and of course persons of that age will probably find other jobs—but that is not so. There is nothing in the Bill to suggest that the pension will not carry on for life. We may have, under this Bill, a young man of parts retired at the age of 33, having entered the Foreign Service at the age of 23, who 40 years hence will still be receiving with gratitude the £100 a year and remembering with affection the name of the right hon. Gentleman the present Foreign Secretary. I do not think that is a proposition which is fully understood by the Committee, or which would be tolerated by the country if it were really understood. In a sense the Amendment we have just accepted makes the position worse because although the amount of pension payable will be lower with the age at which it is granted, probably it will bring in more persons. If a man is retired in a higher rank the amount of pension payable will, of course, be greater still. Let us assume that a man is retired in the rank of counsellor, in which the initial salary is £1,200 a year. After 20 years' service he will receive £300 a year, and a lump sum of £900. It is, of course, open to the Foreign Secretary in all cases to bring up the pension to £300 a year, with £900 as a lump sum, but, apart from the manuscript Amendment which has just been accepted, it would be inevitable that any young man retired under this Bill would get £100 a year for life, together with a lump sum of £300. At a time when we have been doing our best to wring out of the Chancellor of the Exchequer a few coppers for the soldiers, the old age pensioners and the blind, it would be very difficult to justify such a proposition. It was suggested by the hon. Member for Wallsend (Miss Ward) on the Second Reading that the Treasury had resisted this Bill. I hope that, at any rate, it has resisted this proposition. It would not be doing its duty by the nation's finances unless it did. The Amendment does not resist the payment of a lump sum. I think that would be right, for the man who has to settle down in another job. It would allow him pension for 12 months. We must expect that a man in his thirties or forties could settle down in 12 months. He must have been a man of some parts to get into the Foreign Service at all. In the Foreign Service he will gain experience which will fit him for other positions. In these circumstances, it seems to me quite unjustifiable that he should for the rest of his life draw a pension of £100 a year."This Bill will at least give a man who has chosen the wrong profession a pension to carry on with until he can find something else to do."—[OFFICIAL REPORT, 22nd June, 1943: col. 1077, Vol. 390.]
In case the right hon. Gentleman intends to put in another manuscript Amendment, I would like to say, with great respect, that I am at variance with my hon. Friend. I do not think his proposition is a very good one. I have always understood that pensions in the Civil Service were part of pay, and that people got lower pay because they had expectations of pensions. [An HON. MEMBER: "And security."] And security, as the hon. Member says. It would seem to me that if the Amendment were agreed to, people whose employment in the Foreign Service was terminated by the Foreign Secretary would be financially penalised. I understood that the whole object of the Bill was to see that people could leave the Service without being penalised, except 'in so far as it is penalising them to make them leave the Service at all. For that reason I think it would be very unfortunate if the Amendment were passed. It would have the effect of making the Foreign Secretary withhold his powers, because he would be afraid of unduly penalising these persons.
It seems to me that this matter affects the whole Civil Service. I cannot see why there should be this special arrangement for those in the Foreign Service. I know from experience that in order to get any kind of pension in the Civil Service, you have to serve for 40 years. It is obvious that the same reasons which may make it advisable to dispense with the services of those in the Foreign Service are equally applicable to the Civil Service. Therefore, if you make an arrangement of this kind for the Foreign Service, something of the kind must be done for the home Civil Service. That would lead to a great change in our present arrangements. It might be advisable to start such a system, but it seems to me somewhat unfair to the home Civil Service that there should be this special arrangement for the Foreign Service. I should be inclined, if it came to a Division, to vote for this Amendment, because I think it is a matter which requires more consideration than has been given to it. I do not think it necessary to go to a Division but I think it necessary to draw the attention of the Government to a very strange state of affairs, by which you have one system for the Foreign Service, and another for the home Civil Service.
I have listened with great interest to the three speeches on this very important subject—for important it is. As regards the home Civil Service, I hope that if that question is raised again, it will be very fully considered. As for conditions in the Foreign Service, there are members of it who have given more than 30 years' service and who are retired without pensions. That is most undesirable. This Measure appears to me to be worthy of full support on two grounds: firstly, national, and secondly, humane. It surely cannot be in the national interest that a man should remain indefinitely in a career for which he has proven himself unsuited. We have to remember that a young man when he chooses his career, may choose a wrong one. It is not his fault. If in a few years it is proven to be wrong, he will under this Bill have a chance. He will serve for 10 years. During that 10 years he will have proven himself suitable or unsuitable. My right hon. Friend the Foreign Secretary, as he has said, will not take it upon himself, nor will his successors presumably take it upon themselves, to decide upon a man about whom they know very little. It is proposed to set up an organisation, which will, I imagine, keep a full record of every man in the Service. I think that the hon. Member who moved a previous Amendment failed perhaps to realise that we are dealing with two different periods, the present moment and the future, when the Consular and Diplomatic Services will be completely amalgamated, and when, therefore, a counsellor or a first secretary may be employed in a Consulate or a Consulate-General.
When it comes to confining this pension to one year, that surely is not humanly fair. The man joins the Service, and in 10 or more years he is proven to be unsuitable. No Foreign Secretary would turn a man out on the streets on payment of a lump sum of £300 and a pension of £100 for one year. The man may be married and have children, and it would not be fair. You must provide for his future. A pension of £100 a year is not very much, but it will help him to keep the wolf from the door until he can find another job. That is the human purpose of this Bill. It is no good keeping people in the Service if they are unsuited to it. They might be brilliant for other work, but for the Foreign Service they are failures. The Foreign Secretary is not going to judge that himself; he is going to have an advisory board, which will tell him, "We have tried this man in the Foreign Office, we have tried him as third secretary at an Embassy, we have tried him as vice-consul in a Consulate or a Consulate-General, and he is not suited in any of these positions, and therefore we think he had better be retired." Surely the Committee will agree that it is highly undesirable, in the interests of the country, that a man should be kept on as a public servant in a service for which he is unsuited and his unsuitability for which he was unable to foresee when he entered it at a young age. The rank of consul brings a man to the age of 40 and when he is in the forties it is far more difficult for him to find a job and I am afraid that I must oppose the Amendment.I hope my hon. Friend the Member for Keighley (Mr. Ivor Thomas) will not feel bound to press his Amendment because I do not really think that it would be for the good of the Foreign Service, nor do I think that all the financial horrors which he envisaged would really amount to a very great deal. The purpose of the Clause in the Bill is to enable my right hon. Friend to retire on pension those who have shown themselves unfitted for the highest posts. During the Debate on the Second Reading, I endeavoured to support this proposal by two principal arguments and both of them, I think, were sound. The first was that if we give this power to the Foreign Secretary which he does not possess today, we would be altering the terms of service of the Foreign Service officer without his consent and therefore we are entitled, indeed we are bound, to give him some compensation.
Surely the Foreign Service officer is like all civil servants. He serves at His Majesty's pleasure and can be turned off without pension.
Yes, theoretically his services can be terminated and my right hon. Friend has the power to terminate it in case of gross inefficiency or gross misdemeanour but it is another thing to determine a man's employment not because he has been inefficient or disloyal but merely, for want of a better expression, because he has become middle-aged. That would be unfair and therefore my hon. Friend's proposal would act unfairly. The second argument I used, and which I still think is sound, is that it is really impossible for my right hon. Friend to dismiss men of that kind who have committed no crime without giving them pensions upon which they can exist.
The hon. Member for West Bromwich (Mr. Dugdale) explained just now—I think quite rightly—that the pension which a civil servant earns and which he gets, is something he has been earning during the years of his service and I do not think it would be right for us to deprive him of something that he has already earned. My hon. Friend said it was wrong for any young man who retired under this Bill to get a pension for the rest of his life. I think he is under some slight misapprehension in that. Though the Bill allows the Foreign Secretary to retire a man who is second secretary or Vice-Consul, in fact it would be extremely unlikely in the diplomatic branch of the Service that a member would be retired until he had been first secretary for some considerable time and had had a chance of showing whether he was fitted for a post of responsibility or not. It would not be the man, normally, who had to years' service who would be retired under this Bill, but the man who had had 10 years' service and had come to a position of responsibility and had then, for a period of years, shown that he was not fitted for that responsibility. I would ask my hon. Friend not to press his Amendment for these two reasons. It cuts right across the two arguments with which this proposal is supported. My hon. and gallant Friend the Member for North Newcastle-upon-Tyne (Sir C. Headlam) asked why this should be applied to the Foreign Service when it is not applied to the Civil Service as a whole. My hon. and gallant Friend is probably aware that some time ago the House debated very fully the White Paper which contained my right hon. Friend's proposals for the reorganisation of the Foreign Service and approved these proposals by a very substantial majority. It is a fact that, rightly or wrongly, the House approved the proposition that the Foreign Service should be regarded as a service distinct and separate from the home Civil Service. I do not see that there is any reason why the Committee now should wish to go back upon the decision of the House but it is reasonable that a provision of this kind should be applied to the Foreign Service, and for this reason. The Foreign Service officer has pursued a highly specialised career. He has probably spent most of his period of service abroad. If he is unsuitable for service abroad, it is very difficult to find another place in the Government service into which he could be fitted, whereas the home Civil Service is very much bigger, and if a man does not fit into one Department, or one office, he can very often be transferred and admitted into another. I would again say that to accept my hon. Friend's Amendment would be to destroy in effect the whole purpose of this Clause, and I would just put this to him. It might be an extravagance to pension a member of the Foreign Service, as indeed it might be to pension anybody else, for a period of years but I do not think the extravagance is anything like as great as the extravagance of keeping and maintaining in the public service somebody who is not fitted to perform the function of his rank and who is only cluttering up the avenues of promotion for younger and abler people who are coming behind.
I beg to ask leave of the Committee to withdraw the Amendment, but for a different reason than that given by the right hon. Gentleman. This is a temporary Measure and we are promised a comprehensive Bill, and I hope that by that time the question will have received the consideration hon. Members desire.
Amendment, by leave, withdrawn.
Clause, as amended, ordered to stand part of the Bill.
Clauses 3, 4 and 5 ordered to stand part of the Bill.
Clause 6—(Modification Of Enactments)
Motion made, and Question proposed, "That the Clause stand part of the Bill."
I wish to say a few words on this Clause. Obviously we cannot oppose it at this stage, but, as indicated on the Second Reading of the Bill, I hope there will be no such Clause in the comprehensive Bill when it is introduced. I do not say that on the ground that it is reintroducing the Star Chamber as has been suggested but in a properly drafted Bill there ought not to be such a: Clause. The draftsmen should know what enactments need to be amended, and I hope that in the comprehensive Bill that will have been done.
Question, "That the Clause stand part of the Bill," put, and agreed to.
Clause 7 ordered to stand part of the Bill.
Schedule and Preamble agreed to.
Bill reported, with an Amendment; as amended, considered.
Motion made, and Question proposed, "That the Bill be now read the Third time."
In the Debate on the Second Reading I expressed some anxieties about abuses which might be made of the powers under this Bill, and it was agreed by the Foreign Secretary that there might be abuses and that the use of these powers would have to be watched. Other hon. Members disputed that, in particular the right hon. Gentleman the Member for Mitcham (Sir M. Robertson), who said:
I did not care at the time to interrupt the Fight hon. Gentleman, but I was a little surprised to hear that statement. In view of what he said, may I remind the House that there has been at least one very well known case in which a distinguished public servant was removed from the Foreign Office because the advice he tendered to the Government was not acceptable? No doubt the views now expressed by Lord Vansittart do not find universal acceptance, but as we look back there can be no doubt that the advice he gave to the Foreign Office, which led first of all to his being made Chief Diplomatic Adviser to the Government and then eventually to his being taken out of the Foreign Office altogether——"There will be no question of political influence. In point of fact that has never obtained in the whole of my rather long career. A man's own personal political views just do not matter."—[OFFICIAL REPORT, 22nd June, 1943; col. 1077, Vol. 390.]
Is the hon. Member suggesting that Lord Vansittart was removed?
Yes, most definitely.
By whom?
Surely there is no need now to conceal——
The hon Member made the statement that Lord Vansittart was removed from the Service, and I asked him to substantiate it.
He was made Chief Diplomatic Adviser because the advice he was tendering to the Government was not acceptable.
That is not being removed; he was still in the Service.
The right hon. Gentleman is playing with words.
Emphatically not.
If Lord Vansittart's advice was not acceptable, why was he appointed Chief Diplomatic Adviser?
That is a conundrum which the hon. Member must be able to answer himself. Everyone knows that from the moment Lord Vansittart was made Chief Diplomatic Adviser to the Government his advice was not sought. I give that as an example to show what may happen under this Bill when advice given by members of the Foreign Service may be unacceptable to their superiors and advantage might be taken to get rid of them. This is not the only case. It is quite well known that the son of a right hon. Member of this House who served in the Embassy in Berlin was compelled to resign because the advice he tendered made things so uncomfortable for him in that office.
I must insist on establishing what the hon. Member means when he says that that member of the Diplomatic Service resigned. He was not removed by the Foreign Secretary, which is the point at issue.
Quite so, but the right hon. Gentleman has served in the Foreign Service himself and he knows how easy it is to make a man's life so uncomfortable that he will resign.
That is not the case.
Perhaps I might be allowed to assert it, not without some knowledge of these things. Those are examples that elaborate my point that these powers could be used, and it is out of zeal to protect the Foreign Office and the willingness of its members to tender advice that may be unpopular with their chiefs that I do it.
I am generally in such sympathy with what my hon. Friend says in this House—as I am on this occasion—but is he suggesting that the conduct of foreign policy should be exclusively in the hands of Foreign Office officials?
No, it is the duty of Foreign Office officials to give advice to the Foreign Secretary, who must bear the responsibility for acting upon it or not. Undoubtedly, that advice is a most important element in the making of a policy, and it is very desirable that these officials should be able to give advice without any fear of the consequences. I am sure my hon. Friend will agree with me on that point. The main object of this Bill is that the Foreign Secretary may get rid of persons who have proved themselves good subordinates but who are unsuited for the highest posts. I cannot see why these people should not be allowed to go on being good subordinates if they have proved themselves to be good subordinates. There is no obligation on the Foreign Secretary to promote them to higher posts; they could be left to do the work they have done so well already.
This Bill proposes new machinery for dealing with the problem of midde age. I have been turning round in my mind various alternative suggestions for dealing with it, but I have not reached any satisfactory conclusion. However, before we have the comprehensive Bill the Foreign Secretary may consider giving a right of appeal to such persons. My difficulty is to find a suitable court of appeal. One suggestion made is that it should be the Permanent Secretary to the Treasury, but that is not one I could endorse because I do not think that that distinguished official should have any control over the Foreign Office. Another possibility that perhaps deserves more examination is that the Civil Service Commissioners should constitute the court of appeal.The hon. Member is getting very wide of the Bill; he must confine himself to what is in the Bill. So far as I am aware, the Civil Service Commissioners are not concerned with it.
I bow to your Ruling, Mr. Deputy-Speaker. I was simply dealing with the retirement of civil servants under this Bill, but I can see that as there is no reference to a right of appeal I cannot develop that argument. It might be better not to have powers to retire men at such a early age as is envisaged in this Bill, and I should have been happier if there had been power to retire men at the age of 55 or, if need be, even at 50.
Question, "That the Bill be now read the Third time," put, and agreed to.
Bill read the Third time, and passed.
Emergency Powers (Isle Of Man Defence) Bill
Order for Second Reading read.
I beg to move, "That the Bill be now read a Second time."
The need for this Bill is due to certain technical considerations arising from the fact that the Isle of Man is not part of the United Kingdom. The National Service Acts of 1939 and 194o and the first National Service Act of 1941 have been applied to the Isle of Man by Order in Council. The result is that men in the Isle of Man who are under the age of 41, are subjected to the same liability to military service as men under 41 in the United Kingdom. As regards women and men over the age of 41 in the Isle of Man, there is in operation a Defence Regulation which is the counterpart of the United Kingdom Defence Regulation, 58A, which enables the Minister of Labour to direct any person in Great Britain to undertake such service as may be required in the national interest. Under the corresponding Isle of Man Regulation, persons in the Isle of Man can be directed into employment in the same way as persons in this country can be directed into employment in the United Kingdom. Consequently, men and women in the Isle of Man can be directed to perform Civil Defence duty, and to undertake other work of national importance in the Isle of Man. The absence, however, of any power to direct persons in the Isle of Man to take up work in the United Kingdom leaves a loophole for women and for men over 41 who are ordinarily resident in the United Kingdom, to avoid their obligations by transferring their residence to the Isle of Man. The information available to the Home Office does not show that any appreciable number of people have taken advantage of this loophole. If there are persons who have gone from Great Britain to the Isle of Man to avoid their obligations, their number must be extremely small. Nevertheless, it is clearly undesirable to leave a loophole of this kind and the object of the Bill is to stop this gap in the existing law. This object is effected by a provision in Clause 1 which authorises the making of Defence Regulations requiring persons in the Isle of Man to take up work of national importance in the United Kingdom. As regards persons ordinarily resident in the Isle of Man on 24th August, 1939—that is the date of the first Emergency Powers Act—there is a proviso that they shall be exempted from service outside the island, unless and until the local legislature agrees that such an obligation may be imposed upon them. As regards persons not ordinarily resident in the Isle of Man at that date, there will be power as soon as the Bill becomes law, to direct them to undertake service in the United Kingdom and, as a consequence, there will be no method by which any person ordinarily resident in the United Kingdom at the outbreak of war, can escape his or her obligations by means of residence in the Isle of Man.Question, "That the Bill be now read a Second time," put, and agreed to.
Bill read a Second time.
Bill committed to a Committee of the Whole House.—[ Major Sir James Edmondson.]
Committee upon the next Sitting Day.
Coal Bill Lords
Order for Second Reading read.
I beg to move, "That the Bill he now read a Second time."
This Bill concerns the coalmining industry, and, paradoxical as it may appear at first, there is nothing contentious in it. Except for one Clause, it proposes to amend Part I of the Coal Act, 1938, dealing with the unification of coal royalties in the ownership of the coal mined. None of the Amendments which the Bill proposes are worthy to be described as introducing any new principle whatever. All of them are within the intention of the existing Act. They merely rectify a few errors, or omissions, or other matters on a similar plane, which experience has disclosed, and, when one remembers not only the size but the character of the ground covered by the original Measure, it is, I think, a great tribute to those who were responsible for its terms that the Bill is not a far longer and more difficult one than it is. Indeed, of the 15 substantive Clauses I do not think there are more than two or three that it is necessary to refer to at all. Clause 3 is definitely one which has to be referred to. It occupies, with its Schedule, 4½ pages, but most of it deals with ancillary or consequential matters, and the object and effect of it are simple. It is an Amendment of Section 13 of the original Act, which related to the grant of leases to colliery companies of coal, and mines of coal, which were formerly their freehold property. The primary purpose of the Section was to assure to colliery freeholders a right to security of tenure as lessees of what was previously their freehold coal, analogous to the right given to colliery leaseholders by Section 5 of the Act of 1938 to retain their existing rights in coal and mines of which they hold the leasehold. Just as colliery leaseholders under existing leases remain undisturbed by the Act, so Parliament gives to colliery freeholders the right to have leases of what had been their freehold on terms which leave them financially no worse and no better off than they were as freeholders. The intention, therefore, of the Section, which Parliament accepted, was that the colliery freeholders' financial position should be no better and no worse as the result of the transfer of these freeholds to the Commission. It has not, however, been found possible to give effect to this evident desire of Parliament, and I am certain the House will realise why when I say that Section 13 provided for the fixation of rent or royalty payable annually, for whatever period will be required to work out the coal in question, at such an amount or rate that the present value of the annual payment, after taking into account relief from Mineral Rights Duty and other things, will be the amount of the compensation paid for the property under the Act. I was not surprised when I was advised that to do this would be proved beyond human capacity. For instance, the period required to work out the coal is quite unpredictable. Similarly with the varying annual yield of any given rate of royalties. It has been found that the only way to carry out the intention of Parliament in the main Act is for the colliery freeholders to make to the Commission one lump-sum payment equivalent to the compensation received for the property, to have a peppercorn lease and to continue to carry the liabilities of Mineral Rights Duty, Miners' Welfare Levy and the other liabilities which ordinarily attach to the freeholder. That, in short, is the purpose of the Clause. It is purely to make effective what was quite obviously the intention of Parliament in the original Act. It also has to provide for the event of colliery freeholders not wishing to avail themselves of a lease on these terms, and therefore wishing to withdraw an application they had already made under Section 13. These and various consequential matters are the subject of Subsection (4) of Clause 3 and the Schedule. In such a case the colliery can still ask the Commission for a lease of the property, but in that event the lease will be negotiated and settled in the same way as the lease of any other coal not subject to any existing lease and outside the provisions of Section 13. Clause 10 also needs some explanation. It concerns the rights which are vested in the Commission in a certain special class of case. Under the Act, the Commission has acquired from the owners of the coal all property and rights which the owner could sell to a purchaser in virtue of his ownership of the coal, but where he also owned the surface, not in virtue of that ownership. There are cases in which the owner of both the coal and the surface has granted a lease of the coal, but subject to a condition that before the lessee works any coal which supports a building or buildings he must give notice to the lessor and the lessor can then say whether such coal can be worked or not. In some of these cases it is not clear whether the right to receive that notice and to give or to withhold permission to work coal has now become vested in the Commission or not. For most practical purposes such coal is in the same position as coal belonging to the owner of the surface and not yet let. This under the principal Act is vested in the Commission with the right to allow it to be worked and to let down the surface, but subject to a liability for any resultant subsidence damage and subject further to a right of appeal to the Railway and Canal Commission to impose restrictions on the working if they hold that it is in the national interest to see that the buildings or works should be so protected. Substantially speaking, Clause 10 proposes the same for any coal which, though included in a lease, is yet subject to the express condition that it cannot be worked without consent.Is that right granted to all property owners who might have property on the surface? In a village, for instance, where most of the workers own their own houses, would they have the same right to compensation as the owner of the land?
Under the existing system I think I am right in saying —and I do not pose as an authority—that any land that was either built upon or purchased was usually the subject of a notice of approach clause. In certain cases the owner of the land, who happened to be also the owner of the coal, insisted that notice should be given when they were approaching. There is a right under Clause 10 and the Second Schedule of an appeal to the Railway and Canal Commission. There is also a right to compensation. I do not know whether it alters the liabilities that attach to land that was bought when people knew full well what the circumstances were. I do not think it does. As I have said, there is nothing altered by this Bill, which is simply a tidying up of one or two things.
The only other Clause I need refer to is Clause 6. Even this is only a tidying-up Amendment of Section 22 of the principal Act. That Section amended the Working Facilities legislation of 1923 and 1926, which was largely an alternative to unification of coal ownership and gave jurisdiction to the Railway and Canal Commission in the national interest to grant rights to work coal or ancillary rights required in connection with the working of the coal where the person with power to grant them could not be found, or was unwilling, or asked unreasonable terms, or the persons were inconveniently numerous. When the ownership of coal was vested in the Coal Commission, it became unnecessary—and would have been anomalous—for this jurisdiction to have continued after the vesting date, so far as it was to be within the competence of the Coal Commission to grant or withhold rights applied for. Section 22 of the principal Act accordingly repealed the Working Facilities legislation in respect of the grants of rights to work coal, but not in respect of ancillary rights. Two inconsistencies have come to light. One is that the jurisdiction of the Railway and Canal Commission has been repealed in circumstances in which the Coal Commission also has no power. The other is that in certain respects the jurisdiction of the Railway and Canal Commission still exists although the Coal Commission has powers. Where coal is comprised in a retained lease to a colliery company, the Coal Commission has no power to interfere with the lease while it lasts, even though the coal, or some of it, ought to be worked in the national interests by a neighbouring concern. In cases of this kind the jurisdiction of the Railway and Canal Commission should remain, provided applications for transfer are approved by the Coal Commission. Then there is provision in the 1926 Act which enables the Railway and Canal Commission, on application by a colliery lessee, to modify conditions or restrictions in leases affecting the working of coal. This is still right, where the person with power to modify conditions is some person other than the Coal Commission, but where the matter is within the powers of the Coal Commission itself it would be inconsistent with the general tenor of Section 22 that the Railway and Canal Commission should also have that jurisdiction. Clause 6 is designed to restore the jurisdiction of the Railway and Canal Commission in the first set of circumstances, and in the latter to limit it to modifications which are outside the powers of the Coal Commission. These are the three Clauses on which I think it right to say a word of explanation. The Bill is quite non-contentious and puts into effect in one case what was the obvious intention of Parliament and tidies up one or two things in the other.Can the Minister help us with respect to Clause 2 and say why it was put into the Bill?
It is merely to prevent a person taking advantage of a doubt that exists with regard to certain cases of underground way-leaves. There is some doubt about it and we want to put the matter beyond any question.
The Minister said that paradoxically this Bill, though it deals with coal, is a non-contentious Measure. I wonder whether he said that with so much confidence because he knows that very few of us understand fully its language. If it were in plain English, there certainly might be a good deal of contention about it, and in any case we wish to ask one or two questions. The Bill has been brought before us because, in working out the new scheme, the Coal Commission have encountered certain difficulties and find it desirable to remove them. It did occur to us that before the Bill was brought forward the Coal Commission should have presented a report on their work. It is five years now since the House of Commons passed the Act. Most of my hon. Friends were, like myself, Members of the House at the time and remember the weary weeks we spent upon it. The date for the transfer from the private owners to the State, the vesting date, was 1st July, 1942. This great national asset, next to our soil this country's richest possession, is now the property of the State, and for 12 months it has been worked by the Coal Commission as administrators, acting for the nation, who are the owners. It occurs to me that it would have been better if there had been a report from the Commission outlining their experiences in working this property, giving us some detailed account of their work and why it has become necessary to bring this Bill forward.
My hon. Friends and I are anxious about two things. First we are anxious that there should be no provision in this Bill—particularly in those Clauses which are difficult to understand—which gives to the royalty owners more than they were awarded by the tribunal. On that we are entitled to ask for a very definite assurance indeed. There should be no provision which will provide the opportunity for anybody to have a penny more than the amount of the bargain price. We made a bargain with them. My hon. Friends and I were of the opinion that it was a case in which the nation might have recovered its own property without giving compensation to anybody, but in the end it was decided as a matter of policy to give compensation. The amount to be given as compensation was settled by the Tribunal at £66,400,000, and it is our duty to see that no more than was actually contracted for is paid, and that none of these provisions will enable a royalty owner to get more. The second thing we are concerned about is that none of these provisions shall hamper or limit or impede the Coal Commission in the great work it has to do. The first thing it has to do is to see that the existing leases are properly carried out, safeguarding the interests of the nation as the owners, but beyond that there is other work, and I should like the Minister to say a word about it. Now that ownership of the royalties is unified it becomes possible to plan the future development of this industry on national lines, a thing which was never possible before. We are paying the royalty owners £66,000,000, but the biggest price which the nation has paid was revealed by one of the Commissions, I forget which, which made investigations into the industry and estimated that the amount of coal irretrievably lost to the nation by leaving barriers behind to suit the royalty owners was 4,000,000,000 tons of coal. Because those barriers were left behind it will never be possible to recover that coal. That is a tremendous loss to this nation. We are very suspicious about these long Clauses which the Attorney-General and others of the legal fraternity so much enjoy, but which to us are double Dutch, and I want to repeat the question put by my hon. Friend and to ask why Clause 2 is in the Bill at all. It is obviously a Clause to amend the Act of 1938. Why is it desirable to change it? It is to amend it, as I understand, in order to allow for underground wayleaves not to be affected by the unification of ownership. Why not? I thought one of the purposes of unified ownership was to do away with these completely unjustifiable wayleaves and rents paid in the mining industry. Are we to understand that Clause 2 will perpetuate all the existing agreements about way-leaves? There are all kinds of silly things for which persons get a penny a ton or other payments. We are entitled to ask why, in 1943, five years after the Act of 1938 was passed, it is proposed to amend it. I hope we shall get an explanation, and I say with great respect that I do not think we shall be entirely satisfied with the explanation which has already been given in answer to one of my hon. Friends. Clause 3 is one which changes the method by which coal is to be let to the persons who were the freehold coalowners when the Act was passed in 1938. At the time I objected. I thought they got a good bargain, but a provision was inserted that when they got leases from the Coal Commission, acting for the Government, they should be in no worse position than they were before. This privilege was extended to those who became freeholders right up to the date of the Second Reading of the Bill. However, that is in the Act, and we do not desire to raise the point that it should be changed now, but we are entitled to make sure that those concerned will not get more than the Act allows. The Act said they must have terms equally favourable to the terms on which they worked their coal when they were the coalowners and the royalty owners as well. They are entitled to get equally good terms, but not better terms. Coming to Clause 6, I have already referred to the great importance of the future planning of the industry. In planning the untapped sources of coal in the country we must show some really intelligent planning. Therefore, we are anxious that there shall be nothing in the Bill which takes from the Coal Commission any power to do this planning intelligently. Can the Minister assure us that Sub-section (3) of Clause 6 does not take away from the Commission rights which were conferred upon them by the Act of 1938 and rights which are essential to them for planning? If we can be assured that the Coal Commission and the Minister and his advisers are assured that that is so, we shall not object to it. This Bill evokes memories of my old days as a miners' official. The National Industrial Board is to be dissolved, under Clause 14. It was stillborn. I remember in 1931 going with a dispute, which we were presenting before the National Industrial Board. The mineowners boycotted that Board from the beginning. The intention of the Board was good. It was to set up national machinery to which districts in the mining industry which could not settle their problems at home could bring their disputes to have them adjudicated upon by men from both sides of the industry all over the country, with the object of arriving at some kind of national unification of wages. The project failed, because the owners boycotted it. Now that we are dissolving it I can only say that it is a very great pity that it was not allowed to work, because a very great deal of the trouble which we have had in the industry since could have been avoided. Now that there is to be permanent machinery we do not object to the Board being dissolved. I end as I began by saying that we should have a report from the Commission about its work and its plans for working the unworked coal of this country in the future. To have a report of that kind would be of the very greatest importance. I have been discussing with colleagues in the industry on a committee what is to take place in the mining indus- try in the future. We shall have a great deal of reorganisation and of re-equipment of old pits. Probably we shall have to sink a large number of new pits. On Sunday I asked someone who is competent to give an answer in a matter of the kind how much money would be required to sink the new pits and re-equip the old ones in South Wales at the end of the war in order to make a really good beginning in that section of the coalfield. He said that the capital required would be at least £30,000,000. A similar, job has to be done in most of the older coal pits and some of the new ones. Here is a chance for the Ministry and the Coal Commission to do that job in a really intelligent way, relating the sinking of pits to the communities and to the amenities that are required. We can make these new pits the beginning of a new chapter in the mining industry by planning them intelligently, and we can avoid the frightful mistakes that we made in the past because of the lack of planning and of national purpose. I would ask the Minister to give us a promise that he will consult the Coal Commission at a very early date and that we shall have a report on the working of this property. The Commission are trustees for the nation. I hope we shall also have a report upon the ideas which the Commission have of planning this industry. They owe it to the nation to give us their ideas for the better and more intelligent working of this industry in the days that are to come.I am tempted to put the matter far more strongly than my hon. Friend has put it. I do not think that the House has been treated very decently in this matter. The Commission have been at work for some four years handling and disposing of a huge sum of public money. The business has been carried on secretly without Parliament getting any kind of report about the progress the Commission have made and in what way they have been spending the money. We have been told nothing about the troubles, difficulties or shortcomings that must have been experienced in applying a very big piece of legislation. I would remind hon. Members that the legislation did not pass through this House without considerable misgivings on the part of some Members and many protests. There were many of us who were of opinion then and are of the same opinion to-day—I am not going to discuss it, but we might as well refresh our memories—that no person had the right to levy such a tribute upon the people of this country for a mineral concerning which they had nothing to do in the history of this earth in bringing it into being. Many of us have always felt keenly about the handing-over of a vast amount of public money to people who have no moral or historical claim to it. This House should have been treated a little more decently and intelligently than it is being treated in the mere tabling of a Bill of this kind and the very short explanation we have had of it.
I do not know why Bills of this kind should be drafted in such a complicated fashion. There are some things that we learn in our lives, very important things, that are explained to us or written for us in a manner that is intelligible to most of us; but why this hotchpotch of a Bill? Why has it been drafted with the deliberate intention of making it as obscure as it is possible to make a Bill? What was the reason for its being presented in the language that is here? Hon. Members could not be blamed if the Minister and those concerned with the Bill were kept here for the next four or five hours to answer questions about it. I doubt at times whether the House is exercising the rights and obligations that rest upon it in allowing important pieces of legislation of this kind to pass, on the very meagre explanations that we get from time to time. I want an explanation of Clause 1. There may be no harm in it, and it may be just a piece of machinery, but I want to understand it like a practical man. We are told in the margin that it relates to the retention of interests of persons working minerals other than coal. Perhaps the best thing I could do would be to give the House an illustration. Let us assume what often happens in the coalfields of this country, that in addition to the seam of coal there is a bed immediately under it of, say, fireclay. I know of two seams that were worked because of the importance of the fireclay forming the bed to the coal. Are we to understand that that fireclay, which is very useful, is attached to the coal seam, and is worked at the same time as the coal seam, is being worked by interests that are independent from and separate from the seam? Is that what is meant by a retained interest? I could give other illustrations, for example, where beds of iron pyrites are in close connection with the coal. I know of certain small seams having been worked in the old days because people were anxious to get the iron pyrites. Would iron pyrites be a retained interest, or are these swallowed up, and amply swallowed up, by the huge amount of money the country is paying? I would like to have a word on Clause 2. Like my hon. Friend, I am still dissatisfied with the explanation given. The side heading to that Clause says:What does it mean? Why should not underground wayleaves be affected by the original Bill that passed through this House, and why this Clause here? Frankly, I dislike Clause 2. Perhaps it is because I have been unable to understand it, but I must not be blamed. I claim to understand English, though at one time it was a very foreign language to me, and if Members of this House cannot read intelligently through Clauses of this kind, I do not think they should be blamed or need apologise for pressing for explanations. I must ask the right hon. and gallant Gentleman to help us a little more on that. Down in the last little paragraph but one in this Clause—it is paragraph (2), it says:"Rents for underground wayleaves not to be affected by unification of ownership."
What exactly do we mean by "document" there? Any old documents, any private understanding come to between two persons who are not already satisfied with the loot that is being distributed through this Measure? What kind of document, and what guarantees are there that the Commission can be protected, and can at the same time protect the people of this country? What guarantee is there that any document so submitted is not spurious? I want the right hon. and gallant Gentleman to appreciate that I am very merciful in attempting to put certain questions relating to this Bill. There are many dark and obscure and suspicious points about this Bill. [Interruption.] Certainly. But probably the difference between the right hon. and gallant Gentleman and myself is that the whole business was suspicious and extremely unhealthy from our point of view, and I have not been cured even yet. This Bill does not help the cure at all. I would like not only an explanation. Some of us know the history of coal in this country very well. As my hon. Friend has said, no mineral ever discovered in our earth has been so abused by financial wangling on the one hand and by wastefulness in its mining. My hon. Friend, who is a coal miner, will agree with me on the latter part. We want some assurance on this point relating to documents that we are not throwing open the door there for all kinds of spurious and manufactured documents to be used in the working of the Commission."For the purposes of this Section a provision contained in a document varying or supplementating a lease shall be treated as if it were contained in the lease."
The Minister has advised us that this is a non-contentious Measure. It is quite evident that he understands the Measure better than the majority of the hon. Members of this House, perhaps due to the fact that they have not had sufficient time in which to study the intricacies of the Bill or for other reasons. But one thing does emerge, that to-day we have a situation which has not prevailed since coal was first wrought in this country, in that the ownership of coal belongs to the State and that private ownership has been swept away. There can therefore be no sound reason why justice to the citizen either in the person of the private individual concerned or of the local authorities concerned suffering from subsidence where coalmining is wrought should not be given. If this Bill—and I think the Minister has indicated that it is not satisfactory in this respect—does not give that protection which is urgently required, then the Bill must be amended accordingly, because this is an opportunity which may not occur for many years to come. An opportunity may be made available to this House to effect elementary justice.
A large section of my constituents represented by the Stanley Urban District Council, Co. Durham, about a fortnight ago submitted a question to the Ministry of Fuel and Power. It was answered by the Parliamentary Secretary. The question was a request that where coal was being worked packing should be introduced to safeguard against subsidence. The Parliamentary Secretary was unable to give any satisfactory answer, but merely indicated that we are living in a war period and that therefore we must not expect justice to be done to those who suffer injustice, although we may have power so to do. The question of damage to land and property is not eliminated from the Bill. It occupies a very large part. Clause 10 is almost entirely dealing with this problem, and the Second Schedule to the Bill is similarly utilised for this purpose. The protection of the land for the owners of property affected by the working of coal is there introduced, and the question which my constituents and the local authorities ask is, Does this protection extend to the workman's cottage, does it extend to the local authorities concerned in, the matter of their roads and houses and their schools, baths and other buildings and allotments? I can take the Minister to County Durham and indicate to him where damage to each of these has been serious, to the extent of many thousands of pounds in renewals by the local authorities concerned. Certainly this is a reasonable request, and I hope the Minister will see that, if the Bill is innocuous to-day, perhaps it will not be innocuous in Committee. We ask him to adopt in Committee the requisite Clause to rectify this and quite a number of other abuses, which I shall be very happy to indicate.From this discussion one thing is evident—that it was a great mistake, when appointing a Minister of Fuel and Power, to appoint a Welshman. It is obvious that it has resulted in arousing the gravest suspicions in the mind of every other Welshman present. The hon. Member for Merthyr (Mr. S. O. Davies) pointed out that the Bill is somewhat obscure in its diction, and suggested that it should be couched in language which is easily understood. If he considers the matter carefully, he will agree with me that the mere putting of a statement into the plainest possible language does not make its interpretation a matter of agreement among those who read or hear it. It is quite a trite saying at this time that "Blessed are the poor," but it is obvious that Archbishops of the Church of England and all members of the Labour Party, when they read that very plain piece of English, think that it really means that the poor are cursed and that the rich are blessed, and that if the spiritual welfare of the people is to be increased, it is necessary that we should get rid of poverty. The mere fact of putting an Act of Parliament into plain language does not help us in the least, because such plain language as that which I have given as an example has been for 2,000 years a subject of controversy, which is not settled to the present day. The hon. Member for another part of Wales——
I come from Llanelly. If it was a French name, the hon. Member would take great pains to pronounce it correctly.
The hon. Member in question and others have spoken about the success or otherwise of this gigantic scheme. It would be extremely interesting if the Coal Commissioners could give us any reason why this scheme has been or can be of any advantage to any person in this land, whoever he is, whether it will ever reduce the cost of mining coal, and whether it will ever make the miners more satisfied than they have been hitherto.
As some of the questions have been of a rather technical character, perhaps the House would allow me, at the request of my right hon. and gallant Friend, to reply. There is one point of a general character with regard to the Report of the Commission. My right hon. and gallant Friend tells me that only last week he received the first Report of the Commission, covering his period of office. He will certainly be glad to consider its publication. I think the non-publication of earlier Reports since the war has been based on grounds of economy of paper, and it may be that those Reports did not contain matter of general interest. Although I have no information about what this Report contains, my right hon. and gallant Friend will certainly consider publication, in the light of what has been stated in the Debate. My hon. Friend the Member for Llanelly (Mr. J. Griffiths) asked for two general assurances. He asked, first, for an assurance that there was no Clause in this Bill which in effect put up the global sum, that is to say, which enabled any of the persons whose property was taken over under the original Act to get more than they would have done. The answer is that there is no Clause in the Bill which could have that effect. The second point was, whether any of these Clauses would impede the Coal Commission in the tasks entrusted to them under the conditions of the original Act. The answer to that question is, No.
The Minister was asked questions about one or two of the specific Clauses. I will take them in the order in which they come. One hon. Gentleman asked, Why was Clause 1 there? It really is a drafting point. As the House knows, it was the intention of the original Act that leasehold interests in coal should be retained, but the words used in the Act restricted its effect to the obvious case that we all had in mind, namely, that of persons carrying on the business of coalmining. That was what we were all considering—colliery companies. There are some concerns which have leasehold interests which cover coal, although their main business is not the business of coalmining. Under the original Act, they are not covered by the general provision. It was never intended that their subordinate leasehold interest in coal should be taken out of their hands, spread over the other interests they have, and treated in any way other than leasehold interests in coal were to be treated. The Commission have made no attempt to vest such leasehold interests in themselves: it would be contrary to the whole scheme; but, by an oversight, the original Act, in defining the class of persons whose leasehold interests were to be retained to persons carrying on the business of coalmining, inadvertently failed to apply the principle to leasehold interests in coal, to persons not carrying on the business of coalmining. It really is a drafting point, and I hope that my hon. Friend will be satisfied. Clause 2 is put in to protect the Commission. There are cases in which a way-leave is payable by lessee to lessee in respect of coal carried through the area covered by the lease, but coming from elsewhere. If the "elsewhere" is defined in this way, "coming from an area other than that covered by the lease," it is quite plain that the wayleave has to continue to be paid, and it will be, to the Commission, who have stepped into the shoes of the coal owner, but if the liability to pay the wayleave were defined in this way, "a wayleave of so much shall be payable in respect of coal the property of some owner other than the lessor," doubt might be thrown on whether that wayleave survived now that there is only one owner, the Coal Commission. The intention is that these way-leaves should not be abolished by the original Act. Section 25 (2, a) of the original Act contemplates that, as the Commission is able to iron things out and get new leases and new agreements, way-leaves are one of the things which will disappear. There was no intention of abolishing them by virtue of the vesting in the Commission. What has been found in this particular class of wayleave is that in some cases the words "coal the property of other owners" are used. The argument has been made that on the basis of those words the wayleaves have been abolished, and it is a perfectly honest and proper one. To prevent any argument of that kind being raised and because that form of words is used, some different principle has to apply. So much for Clause 2.Is it a more practical way of stating the position to say that the right to collect existing wayleaves at the time of the passage of the Act is being maintained in the Act itself?
Yes, Sir.
And nothing is contemplated now except still further to maintain and make certain that where way-leaves are being collected by the owner of property for the passage of coal to a separate property the right to collect the wayleave is maintained even though the whole of the coal has become State property?
Yes, as I say, in some cases the words "coal the property of other owners" were used, and the argument was used that the wayleave was abolished because there was only one owner. With regard to Clause 6 (3), this Sub-section does not take away from the Commission any right for planning or improving the future lay-out of coal. As my right hon. and gallant Friend explained, this really means correcting an inadvertent mistake in the original Bill in dealing with the Railway and Canal Commission in one case, namely, the case of working coal. Where coal can be better worked with a neighbouring colliery we ought to have left the power in the hands of the Railway and Canal Commission to deal with a case of that kind. In the other case dealt with under Clause 3, the Railway and Canal Commission still have jurisdiction to modify onerous terms of a lease, and there is no objection to this where the persons with power to delete or modify, as may happen in some cases, is a third party, for example, a neighbouring landlord. In other cases the Commission ought to be masters and have the power to modify the lease. These are really two small slips in the original Act which are being put right.
We shall surely come back to this on the Committee stage, but is it not clear from the point made up to now that the Commission will not be the final arbiter in a dispute which may occur between the operator of a mine and the Commission which is now the mineral landlord? It is possible for the operator of a coalmine, with the consent of the Commission, to submit this to arbitration by the Railway and Canal Commission, who may themselves over-ride their own landlord.
It was not the intention of the original Act to confer on the Coal Commission power to transfer retained interest from one concern to another. There was no intention under the original Act to give the Commission power to do that. It is really a case of the transfer from a part of a retained interest from one colliery company to another. I think I am accurate in saying that there was no intention in the original Act to transfer power in that way. The consent of the Commission must be obtained, particularly on the question of whether a particular seam or seams of coal would be better worked in the public interest by colliery "A" than by Colliery "B." That is a matter which has to be dealt with in principle by going to the Railway and Canal Commission.
This is one of the points which we shall want to clear up and come back to on the Committee stage. I gather that when the Bill was passed and we discussed the principles of it, one of the things we thought would occur was that the great advantage of the Coal Commission acting for the nation or the owner of the coal would be that they would be able to say, according to the best technical opinion, the coal would be worked better by colliery "A" than colliery "B." They could decide, and that would be the end of it. Now if there is such a proposal and there is a dispute colliery "B" can take it to the Commission, who can decide, and the plan can be impeded.
I think that this helps. He would be a rash man who would be dogmatic at this date as to what was said or particularly what was not said in the course of our Debates five or six years ago. I stated the matter as I think it was and believe it to have been, and if I made a slip, the hon. Gentleman will, I know, be indulgent with me. As we see it, there is no general power, conferred or intended to be conferred, to change the retained interest about, and this provides machinery for this to be done, but this matter can be baked into, if necessary, before the Committee stage. The only other point I ought to deal with is that of my hon. Friend the Member for Consett (Mr. D. Adams), who raised the question of subsidence. This Bill does not intend to deal with the general question of subsidence, nor would anybody expect it to do so.
Why not?
Because that is not its purport, which is, taking the original Act and the principles laid down under the Act, to meet the difficulties which have arisen in the working out of those principles. The hon. Gentleman says that is not the sort of Bill that he particularly cares about, but it plays its useful part, though a minor part, in the working-out of the intentions of Parliament in the original Act.
May I ask the right hon. and learned Gentleman whether it would not be competent to make such provision in the Bill for the protection of local authorities and private individuals against subsidence?
If my hon. Friend is asking me whether an Amendment to do that would be in Order, then it is no good asking me that question, because I neither have the knowledge nor have I the authority nor would it be proper for me to indicate any view I had.
Then it would be in Order?
The hon. Member is optimistic. Clause 10 is dealing with a much narrower point. Coalmining leases, as the House and everybody here knows, frequently require the lessee to give to the lessor notice that workings may be approaching a place where there are buildings above, or whatever it might be, and give to the lessor power to say, "You can go on working" and in some cases to say, "You cannot work." There are varying conditions as to compensation if assent is given to the continued working. Now, in a normal case before the Act the owner of the coal and the surface owner was the same person. The position now is that the Commission will own the coal and the surface owner the land, and, therefore, if under a lease a person who is still the surface owner has the right of veto, there would be every probability that his veto would be frequently used, because he is no longer interested in the coal being worked. His only interest is keeping the surface or buildings free from jeopardy. That is a problem that has to be dealt with, and Clause 10 deals with it by giving power to say, "Yes," or "No," exclusively to the Commission wherever the ex-owner of the coal could have granted it. That is to say, it takes away the power there might be in the present surface owner to say, "No," and says that wherever the previous coalowner, the predecessor in title, had power to say, "Yes," or "No," it shall now be exclusively vested in the Commission, although under the original lease the surface owner might have had a say. Having given that power to the Commission to say, "Yes," or "No," the Clause provides that the surface owner shall be entitled to compensation for damage resulting from the working if assent is given. That seems a sensible way of dealing with the problem; it is obviously right, and I am sure it will appeal to hon. Members opposite. The Commission must, of course, have the right to say, "Yes." If the surface owner has a financial interest in the working of the coal, they must have that power of veto. But as you have given the Commission power——
You are by this Bill accepting the principle of compensation for damage done by subsidence in this particular case.
Would that apply to the property of anyone else—property not owned by a coalowner—which was damaged by the working of the coal?
No, I think it would apply to property affected by the mining of the coal in respect of which assent was given, but perhaps the hon. Gentleman will allow his point to be looked into. I have stated the general problem with which the Clause is intended to deal.
As I understand it, this Clause only applies to the case in which, prior to the coming in of the Act, the owner of the land and the coal was the same person. Now the owner of the coal is the Commission, while the owner of the land remains the same. I gather that what you do now is give the sole right of determining whether the coal shall be worked to the Coal Commission and at the same time we are giving the right to the landowner, if there is damage to any building, to a claim for compensation for subsidence. We are admitting for that special person the principle which my hon. Friend the Member for Consett (Mr. Adams) was trying to put before the House.
Perhaps the point can be cleared up on the Committee stage.
Yes.
Question, "That the Bill be now read a Second time," put, and agreed to.
Bill read a Second time.
Bill committed to a Committee of the Whole House.—[ Mr. Beechman.]
Committee upon the next Sitting Day.
Emergency Powers (Defence)
Resolved,
"That the Fish Sales (Charges) (No. 2) Order, 1943, dated 9th June, 1943, made by the Treasury under Section 2 of the Emergency Powers (Defence) Act, 1939, a copy of which was presented to this House on 22nd June, be approved."—[Mr. Mabane.]
The remaining Orders were read, and postponed.
It being after the hour appointed far the Adjournment of the House, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order