House of Commons
Monday, March 22, 1954
The House met at Half past Two o'Clock
Prayers
[Mr. SPEAKER in the Chair ]
Private Business
Institution of Mechanical Engineers Bill
Read the Third time, and passed.
NORTHERN ASSURANCE BILL [Lords]
Read the Third time, and passed, without Amendment.
Rhodesian Selection Trust Limited and Associated Companies Bill
Wankie Colliery Bill
As amended, considered; to be read the Third time.
DOVER HARBOUR CONSOLIDATION BILL [Lords]
Read a Second time.
I beg to move,
"That the Standing Orders relative to the Committal stage of Private Bills be suspended, and that the Bill do lie upon the Table."
The reason for this Motion is that the Dover Harbour Consolidation Bill has already been considered by a Joint Committee of Lords and Commons. In such cases, a Committee stage in this House is by practice dispensed with; and, if the House agrees to this Motion, notice will in due course be given of the Report stage of the Bill.
Question put, and agreed to.
Petitions
Seretse Khama
I rise to present a Petition to this House on the subject of the exile of Mr. Seretse Khama from Bechuanaland and the need to restore political rights in the Protectorate.
The Petition is signed by 10,839 citizens of the United Kingdom.
It showeth that in Bechuanaland fundamental rights of liberty and democracy are being infringed with grievous effects upon the future of the people.
That the refusal of Her Majesty's Government to allow Seretse Khama to return to Bechuanaland and to recognise him as the lawful and acclaimed chief of the Bamangwato tribe is an unwarranted denial of personal liberty and is not justified by any principle of public policy or good government.
That political, social and economic progress, essential as an expression of the racial equality which should be the accepted principle of the Protectorate, is prejudiced by the resulting absence of co-operation between the tribe and the administration. The Petition concludes:
To lie upon the Table.
Housing (Repairs and Rents) (Scotland) Bill
I beg leave to present a humble Petition from 25,000 citizens of Scotland praying that the Housing (Repairs and Rents) (Scotland) Bill be withdrawn.
The Petition showeth that the petitioners consider that the Housing (Repairs and Rents) (Scotland) Bill, which proposes an increase of 40 per cent, in rents to private landlords, contains no provision to protect tenants from further exploitation, that it relieves certain owners of liability for increases in rates and transfers their liability to all ratepayers and tenants of local authority houses, and that it will result in perpetuating the slums in Scotland by providing for the retention in use of houses which local authority medical officers have condemned as being unfit for human habitation.
The Petition concludes:
To lie upon the Table.
Oral Answers to Questions
Ministry of Food
Grain Imports
asked the Minister of Food what limits have been imposed on dollar purchases of cereals by private interests; and what arrangements he has made with the grain trade in order to ensure that there shall not be excessive imports of wheat, barley and oats prior to the harvest in this country, and a relaxation of buying with a consequent slump in prices afterwards.
The answer to the first part of the Question is "None, Sir." With regard to the second part of the Question, the grain trade with whom we are in regular contact, is well aware that home-grown cereals will be selling on a free market after July this year in competition with imported cereals and will shape their buying policy accordingly.
Will my hon. Friend give an undertaking that, in examining this question, Her Majesty's Government will give special consideration to the possibility of re-establishing the levy-subsidy, which seems to me to be perhaps the only way of solving a very difficult problem?
I am sure that my hon. Friend would agree that that supplementary question could more appropriately be put to the Chancellor of the Exchequer.
What is the point of the Government simultaneously discouraging home cereal production and permitting these extra imports of dollar grain? Why do the Government do this at a time when everybody knows that our dollar balance is extremely precarious?
I am not sure whether the right hon. Gentleman is speaking for the party opposite when, by implication, he advocates a policy of limiting cheaper imports of food.
Sausages (Meat Content)
asked the Minister of Food what representations have been made to his Department for minimum meat content standards for beef and pork sausages.
The representations have been conflicting, some favouring definite standards of meat content and others being against standards.
As there is some concern from district to district about the way in which the price and the content of sausages change, is not the Minister asking for information to check up on these points so that he can come to some conclusion in view of the conflicting evidence?
Yes, Sir. All food and drugs authorities have been asked to send in, by the end of the month, the details of the analyses by their respective public analysts of such sausages over the past year.
Does not the hon. Gentleman agree that it is far better for the Ministry to lay down some guidance than to leave it to a bench of magistrates to come to a decision without any real information before them?
I am inclined to believe that public taste is even more important than a regulation of the Ministry of Food.
Tinned Milk
3, 4 and 5.
asked the Minister of Food (1) how long his Department have held in their possession the present stocks of evaporated milk, full cream condensed milk and skimmed condensed milk;
(2) what stock, in cases, his Department now hold of evaporated milk, full cream condensed milk and skimmed condensed milk; and
(3) what method he proposes to employ to liquidate his Department's present stocks of evaporated milk, full cream condensed milk and skimmed condensed milk.
As my hon. Friend knows it would be contrary to policy to publish figures of current Ministry stocks. Almost all the tinned milk is of 1953 manufacture. Plans for its disposal are being made in consultation with both sides of the milk industry, so as to ensure the minimum interference with the disposal of this year's manufacturing milk.
Can my hon. Friend give any idea how long it will take to dispose of the stocks, and for how long the stocks of condensed milk have been in existence? Does he not agree that there has been considerable muddle in this matter, and is not it about time that the Ministry faced up to the problem?
I think that my hon. Friend is under a misunderstanding. We do not anticipate difficulty, with the co-operation of the trade, in disposing of these stocks.
Can the hon. Gentleman say after what period of time condensed milk begins to lose its food value?
Not without notice, in dealing with the various kinds of tinned and condensed milk; but, so far as this stock is concerned, it is in good condition and it will be disposed of in good condition.
New Zealand Beef (Freight Rates)
asked the Minister of Food what effect the decision to increase the freight rates on New Zealand chilled beef will have on the procurement costs of such beef; and what discussions were held between the New Zealand Tonnage Committee and his Department before the announcement of this decision.
The increase represents approximately ⅝ths of a ld. per lb. Discussions were held as usual between the Committee and the Department, but no agreed settlement was reached. The New Zealand Meat Board was represented at these discussions.
As the hon. Gentleman will be aware that this has caused real concern among farmers in New Zealand, will he make renewed representations about this because the New Zealanders believe that otherwise they may be prejudiced on decontrol?
I am aware of the concern, and I dissent from nothing that the hon. Gentleman has said.
Cheese
asked the Minister of Food whether he has now received the Report of the Food Standards Committee on processed cheese and cheese spreads.
No, Sir.
Is the Minister aware that in each report for the past two years the Kent County analyst has called attention to the fact that these products are very much below the standard, many of them not containing enough fat and containing too much water? Will he please do something about it?
I am aware that the Report is long overdue. The difficulty has arisen between home producers and overseas manufacturers on a technical point concerned with water content, but I assure the hon. Member that it is hoped that a report on that matter will go to the Committee in May.
asked the Minister of Food whether, in view of the fact that the latest available figures show that 31 per cent, of rationed cheese is not being taken up, he will reduce the price of cheese.
No, Sir. The important fact is that the consumption of cheese is more than a third more than it was before the war.
Is not the hon. Gentleman disappointed that for all practical purposes we remain on a 2 oz. ration, and does he not agree that it would be far better, as the cheese is available, to have an effective 3 oz. ration, which he might do by altering his price policy?
The consumption of cheese at its present high level is bound to be considered in relation to the increased availability of other foods. The hon. Gentleman must take that into account.
Is my hon. Friend aware that at lunch today neither my wife nor myself took cheese, though it was available, because we had had a good fill of meat pie?
11 and 12.
asked the Minister of Food (1) to what extent in the contracts he has with Kent farmers for the storage of cheese piece rates are laid down to be paid to the men who handle the cheese on arrival and dispatch, and turn the cheese at specified intervals: and
(2) whether he will state the terms of the contracts he has entered into with Kent farmers for the storage of cheese.
There are no formal contracts. Payment is at rates agreed with the National Cold Stores Committee who in turn have agreed minimum wage rates with the trades unions concerned.
Is not it a fact that farmers are being paid ld. per crate per day, which means that a farmer with a storage capacity of 10,000 bushels of apples could store 4,000 crates of cheese and thus earn about £116 a week? Will the hon. Gentleman take into consideration the fact that what I am anxious about is that the men who do the actual work should receive adequate payment for the work they do?
I appreciate the point. These are stores normally used for fruit and occasionally used for cheese. The rates are agreed between the National Cold Stores Committee and the farmers concerned. If the hon. Gentleman has any special cases in mind, I will bring them to the notice of the Committee.
Jam (Fruit Content)
asked the Minister of Food if he will increase the minimum fruit content of strawberry jam to not less than 50 per cent.
The present minimum was settled as recently as last September and it is too soon to make a further change.
Is the Minister aware that some samples of jam offered for sale in Kent have been found to contain as little as 32 per cent, fruit, and that members of women's institutes and country housewives generally know that the only really good jam is that which contains fruit and sugar only? Will the hon. Gentleman, to meet the position that is generally complained of, do something about increasing the fruit standard to at least 50 per cent.?
Breaches of the present requirement of a 38 per cent, minimum are matters for the food and drugs authorities. The hon. Gentleman will recall that the Food Standards Committee recommended that for the present the standard should be 38 per cent, and that later it should be 42 per cent.; but I would add that if it became 50 per cent, it is calculated that that would mean an increased cost of 2½d. per lb. of jam.
Can my hon. Friend say what the balance consists of after allowing for fruit and sugar?
There is, alas, water in this as in every other article of food.
Lard
asked the Minister of Food the total quantity of pure lard sold to the public from 1st January, 1954, to the latest convenient date; and how this compares with a similar period in 1950 and 1951.
About 900 tons in the first nine weeks of 1954. The comparable figures for 1950 and 1951 were 4,800 tons and 500 tons.
Prices
13 and 15.
asked the Minister of Food (1) the items of food for which his Department is responsible which were on 16th March, 1954, more expensive than on 1st October, 1951; what were the relative price increases between these two dates; and what action he has taken or intends to take to reduce the price of these foodstuffs;
(2) the items of food, for which his Department is responsible, that are now obtainable at a cheaper price than on 1st October, 1951; and what action his Department has taken to bring about these price reductions.
The only satisfactory measure of such changes is the Interim Index of Retail Prices, which is no higher than it was 12 months ago.
Can the Parliamentary Secretary say where the Tory Party get their propaganda material, because they have, in fact, given a whole list of articles which they allege to have come down in price but which we know have not done so? Can he also tell us whether or not the policy of this Government in bringing down prices has, in fact, affected the lower-paid sections of the population, who are most concerned?
The hon. Gentleman really must face the facts. As has been said many times, this Index is accepted by both sides of the House as a fair expression of the position, and it really is no good trying to escape from the position which it represents.
Old-age Pensioners
asked the Minister of food whether he will consult with the Minister of Pensions and National Insurance for the purpose of initiating a scheme whereby old-age pensioners will be able to obtain their basic rations at 1st October, 1951, prices on production of their old-age pension book or a suitable voucher issued by his Department.
No, Sir.
Is the Parliamentary Secretary aware that I am disappointed and dismayed that he should give that reply? Will he tell his hon. Friend the Member for Croydon, East (Sir H. Williams) that old-age pensioners can afford neither his meat pudding nor his cheese?
Eggs
asked the Minister of Food why 111,600,000 eggs were broken out for sale in liquid form between the date egg prices were decontrolled and the end of January.
Eggs in this form are needed by bakers and other manufacturers.
Is the Parliamentary Secretary aware it is widely alleged that these included first quality eggs, that this operation contained a concealed subsidy, and that the whole operation, for many reasons, ought to be inquired into?
This is a case of liquid eggs being needed by the manufacturers, and, in fact, the number broken out represents no more than 2 per cent, of the total egg supplies.
Can my hon. Friend say what is the subtle difference between a broken egg and a "broken out" egg?
A broken egg is something which my hon. and gallant Friend could achieve in the kitchen, and a broken out egg is the result of a deliberate operation designed to produce the liquid ingredients.
Carbonated Drinks
asked the Minister of Food what representations he has received upon the subject of carbonated drinks.
None, Sir, apart from those of the hon. Member for Stoke-on-Trent, Central (Dr. Stress), who raised the matter on the Adjournment on 4th February last.
Is it not a fact that drinks of this kind, particularly Coca-Cola, contain a very high percentage of acids, and would he not remove many apprehensions if the Minister arranged for a further investigation?
I suggest that my hon. Friend should read the Adjournment debate to which I refer. It really is most undesirable that, on the most slender and scanty evidence, general allegations of the unfitness of teetotal drinks should be spread throughout the country.
Is it not a fact that carbonated drinks give rise to indigestion, both internal and audible?
Consumption Statistics
19 and 20.
asked the Minister of Food (1) for what reasons the official statistics of the average weekly consumption of eggs have recently been amended to reduce the figures for 1950 and increase the figures for 1953;
(2) to what extent the official statistics relating to the consumption of foodstuffs in 1950 and previous years are in course of being revised to show reductions or increases in the hitherto accepted figures.
The changes in the statistics about eggs were due to revised estimates of home production. The delay in carrying the revised 1950 figures into the Digest was due to an oversight. No other revision of the figures for 1950 or earlier years is contemplated.
Will the Minister now confirm that, despite this somewhat belated adjustment, the final outcome is that 14 million fewer eggs were consumed each week in 1953 than in 1950, and that a similar reduction is to be noted in the case of cheese, butter, milk, jam and potatoes?
I cannot at short notice check the hon. and gallant Gentleman's arithmetic, but it is true that the rate of consumption was less in 1953 than in 1950. In relation to the other commodities he mentioned, he will no doubt recall that that year was the year of heavy raiding of stocks for most of the basic commodities.
Is the hon. Gentleman aware that the Digest of Statistics remains unaltered, and the source of the figures is attributed to the Ministry of Food?
The appropriate adjustment of the figures in the Digest will be made.
Meat (Storage Capacity)
asked the Minister of Food what steps are being taken to increase the storage space for meat in this country, including, chilling plant and cold-storage capacity.
In view of the possibility after decontrol of increasing shipments of chilled meat, my right hon. and gallant Friend has no reason to think that existing cold-storage facilities will not prove adequate.
Would not the Minister agree that it is fundamental to any proper meat policy in this country that the facilities for storage of home-killed meat and also cold storage facilities should be increased so that we may have a proper slaughtering and marketing scheme for carcass meat? Can he not give some indication what the Government are doing about this matter?
I pointed out in my answer that we hope that the amount of chilled meat coming to this country will substantially increase, and, if it does, it will mean a corresponding substantial increase in the amount of storage space available.
Ministry of Supply
Jet-propelled Helicopter (Development)
asked the Minister of Supply what progress has been made in the production of the jet-propelled helicopter, "The Rotodyne."
Since the reply given to the hon. Member on 14th December, the manufacturers have completed a small research helicopter embodying the principles of forward propulsion by propellers combined with vertical lift by rotors powered by jet engines at the tips. This machine made its first flight in January.
While thanking the right hon. Gentleman for that very interesting information, may I ask him to bear in mind that the Sabena Belgian Airlines are contemplating introducing a passenger helicopter service between London and Brussels with American helicopters? Does he not think that it would be very much better if we could supply the helicopters for any flights from Britain, and will he press on with this good work?
Of course, the helicopter service to which the hon. Gentleman refers is of a normal type—
A 30-seater.
Yes, but of the normal type. The hon. Gentleman in his Question refers to the "Rotodyne," and the development of this entirely novel idea has still a long way to go. It raises a number of new technical problems, among them that of how to reduce the noise to an extent sufficient to make it acceptable for inter-city services.
While accepting all the difficulties which this design has thrown up, would not the Minister agree that we have slipped behind very badly in helicopter research? In view of the fact that this could put us right in front again, will he assure us that money is not the limiting factor in development?
I am just as keen on this matter as the hon. Gentleman himself, and I can assure him that we are giving every assistance and encouragement we can to the manufacturers to speed up this development.
Steel Production, Wales
asked the Minister of Supply the approximate annual production of steel in Wales in 1947 and 1953, respectively.
I have asked the Iron and Steel Board to be good enough to send my hon. Friend the information he requires.
While thanking the Minister for his reply, may I ask him to bear in mind the fact that the information hitherto published has not included the figures for North Wales, and that, if possible, it is desirable to include them?
As far as I know, the figures for Flintshire and Denbighshire have been included previously in those for an area which also embraces Lancashire and Cheshire.
Bacteriological Warfare
26 and 27.
asked the Minister of Supply (1) the nature of the bacteriological warfare trials recently carried out off the West Coast of Scotland; what was the cost; and if he will make a full statement justifying the expenditure of public funds on these activities;
(2) if he will make a statement on the proposed biological warfare tests to be undertaken by the British Government in Bahaman waters.
The purpose of these trials is to assist us in devising methods of protecting our population against the dangers of attack by bacteriological weapons. It would not be in the public interest to give details.
Could the Minister explain, in view of the defence of the civilian population, why these experiments are not conducted under the auspices of the Ministry of Health, and why it is against the public interest that we should be given some indication of the cost? How could it help any enemy to know the cost, when the Minister is not hiding it from the enemy but only from the House of Commons?
In reply to the hon. Gentleman's first question, as I explained, this is a defence matter and not a public health matter. As to the cost, it is a well-established practice, and a sound one, in my opinion, that we do not publish figures of the cost of individual parts of our defence research programme. It is of great value to other Governments to know what proportion of our total effort, which is shown in the Estimates, is devoted to particular aspects of defence. From that, they can see where the emphasis is being placed, which is a matter of immense military importance.
Do the Government still adhere to the proposal which this country has frequently put forward for the total abolition of bacteriological warfare as a weapon of mass destruction; and has the right hon. Gentleman any scientists working in connection with the international control required to make the abolition effective?
I think I have given the right hon. Gentleman this assurance on more than one occasion when he has raised this subject. I can assure him that there has been no change in Government policy, which remains the same as the policy of the late Government. Our policy, like that of the late Government, is to make ourselves so well prepared against germ warfare that no aggressor would think it worth while to attack us by these revolting methods, and I am sure—and here I turn to the hon. Member for South Ayrshire (Mr. Emrys Hughes)—that we are better serving humanity by facing up squarely to these dangers than by hiding our heads like ostriches, in company with the hon. Member for South Ayrshire.
Are the Government also preparing for effective abolition by international agreement?
I think the right hon. Gentleman can be assured, though I am speaking without consultation with my right hon. Friend the Foreign Secretary but without any hesitation, that we shall be only too glad to find any means which will ensure the abolition of these methods—I have already described them as "revolting"—of conducting war.
Is not the right hon. Gentleman aware that the thing is already covered in international law by a Geneva Convention against bacteriological or biological warfare, which Convention this country has ratified, together with a great many other countries? Does the answer of the right hon. Gentleman mean that pressure or representations are still being made to the United States, who, so far, have not ratified the Convention?
I do not know how the hon. Gentleman can read that into my answer.
In view of the unsatisfactory nature of the Minister's reply, and in order to decide who is the ostrich, I give notice that I shall raise the matter on the Adjournment.
Explosions, Foulness (Complaints)
asked the Minister of Supply if he is aware of the concern of householders on the North-East Essex coast due to damage which has been caused by explosions which have taken place at Foulness, under the authority of his Department; and what steps he is taking to reduce these explosions as far as possible.
I much regret the disturbance caused by these explosions, which have lately, I am afraid, been somewhat louder than previously.
I thank my right hon. Friend very much for his reply and ask him if he is aware how anxious the people of this area are at the proposed new range at Potton Island where a thousand acres are to be taken under control. I hope that he will be able to assure us that he will keep these experiments down as far as possible.
As far as possible, yes; and I only wish I could give my hon. Friend a more reassuring and helpful answer. As he knows, Foulness has been used for testing explosives for more than 100 years. There are, unfortunately, no facilities available for this important defence work in any other part of the country.
Pensions and National Insurance
Old-age Pensioners
asked the Minister of Pensions and National Insurance if he is aware that the average duration of life of men is shorter than the average duration of life of women; that women get old-age pensions at an age earlier in life than men; and if he will take steps to remove this anomaly by providing aid-age pensions for men at the same age as that at which women now receive them.
No, Sir.
Does the right hon. Gentleman realise that there is a real anomaly here and that the high cost of living presses on old men just as hardly and just as early in life as it does on old women? Will he not do something to remove this anomaly?
It would be unwise for me to make any statement while the whole subject is in front of the Phillips Committee. I would remind the hon. and learned Gentleman that his proposals would involve a substantial increase in the contributions payable by men.
asked the Minister of Pensions and National Insurance the approximate number of female old-age pensioners who are between the ages of 60 and 65 years; the number of male and female old-age pensioners between the ages of 65 and 70 years, between 70 and 75 years, between 75 and 80 years, and those who are more than 80 years at the latest convenient date; and if he will set out in the OFFICIAL REPORT the comparable figures as they ware in 1948.
As the reply contains a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
Are the numbers in each category such as to lead my right hon. Friend to hope that extra assistance may be rendered to the older pensioners at reasonable cost?
The numbers in the older age groups, are, of course, increasing with the growing age of the population.
Following are the figures:
The approximate numbers of retirement and contributory and non-contributory old-age pensioners are as follows:
Thousands Ages December, 1948 September, 1953* Men Women Men Women 60–64 … — 652 — 640† 65–69 … 621 732 420† 800 70–74 … 532 698 550 750 75–80 … 315 459 345 515 80 and over 185 348 205 385 Totals … 1,653 2,889 1,520 3,090 * Provisional. † The decline in the numbers in these particular age groups is due to the replacement of contributory old age pensions by retirement pensions for women under 65 and men under 70.
Family Allowances
asked the Minister of Pensions and National Insurance how many married couples, at the latest available date, had only one child; how many families there are with more than one child who receive no family allowance for the eldest child; and what is the total number of children, including those who receive family allowance.
Taking as children those within the age limits laid down by the Family Allowances Act, it is estimated that the numbers for the three categories mentioned in the question are about 3 million; 3,200,000, and 11 million.
Is the Minister aware that the 3 million mentioned who have only one child are half the married couples in the country who have children? Is he further aware that within the first and second categories in the range of income there are 1¼ million families with one child who are below the Income Tax level and therefore are in a bad economic position? Is he further aware that there are 1¼ million families getting 8s., 16s., and 24s. per week who are far beyond the Income Tax level? Can nothing be done to achieve a fairer share of family allowances?
All that seems well worthy of study and consideration.
War Pensions
asked the Minister of Pensions and National Insurance the maximum war disability pension payable to an ex-Service man for loss of sight and both hands as a result of war wounds; the maximum combined pensions payable, under the Royal Warrants and the Industrial Injuries Act, to an ex-Service man who lost his sight in battle and subsequently lost both hands as the result of industrial accident; and whether he will take steps to amend the Royal Warrants to allow the separate assessments for multiple severe war disabilities to be paid in full where the aggregate is more than 100 per cent.
The answer to the first two parts of the Question is, for an ex-private with a wife and two children, and including various allowances, £9 12s. 6d. and £12 4s. 6d. a week, respectively. The answer to the remaining part is: "No, Sir." I do not think the fact that in certain circumstances a man may qualify for compensation or pension under two separate schemes affords any ground for suggesting that a man who suffers multiple war injuries should get a higher pension than a man who suffers as great or may be greater disablement as the result of a single injury.
Is it not a fact that a man who loses both his hands in industry or in action gets a lower rate of pension than the man who loses one hand in industry and one in action? Is that a desirable state of affairs?
That is, of course, so, but duplication of basic payments under different schemes has always been accepted. For example, two separate motor accidents may give rise to two cumulative claims.
asked the Minister of Pensions and National Insurance if he is now able to make a further statement on the subject of an increase in the basic amount of disabled ex-Service men's pensions.
No, Sir. There is nothing I can usefully add to what the Parliamentary Secretary said on this subject in the debate on the Adjournment on 8tb February.
Is the right hon. Gentleman aware that amongst many competing claims this one has exceptional merit, and that although it may not be possible to increase the basic rate, there is a great deal to be said for the most generous supplementation in cases of need?
I cannot add to what the Joint Parliamentary Secretary said on 8th February, except to draw attention to what my hon. Friend the other Joint Parliamentary Secretary said when he confirmed that statement in the debate on Friday.
Extended Benefits
asked the Minister of Pensions and National Insurance how many workers were drawing extended benefit on 3rd July, 1953; how many of them have since obtained employment; how many are still registering for employment; how many are receiving National Assistance; and how many are now receiving a retirement pension.
When Section 62 of the National Insurance Act, 1946 expired there were 47,386 persons in Great Britain receiving extended benefit. Their position on 20th January, 1954, the latest date for which such information is available, was as follows: Position at 20th January, 1954 Men Single Women Married Women All Persons Known to have obtained employment … … … 6,725 1,120 1,064 8,909 Receiving insurance unemployment benefit … … 12,952 1,940 1,969 16,861 Receiving sickness benefit or unemployability supplement … … … … … … … 2,852 287 270 3,409 Receiving retirement pension … … … … 1,207 185 83 1,475 Not receiving one of the above benefits but receiving National Assistance: Total income unchanged … … … … 4,805 365 66 5,236 Total income increased … … … … 2,290 315 29 2,634 Total income reduced … … … … 2,055 225 24 2,304 Not receiving unemployment benefit or National Assistance, but still registering for employment … 1,812 125 156 2,093 Ceased to register for employment—reasons unknown 2,286 582 1,597 4,465* 36,984 5,144 5,258 47,386 *Included in this figure are 256 people who have died since 4th July, 1953.
Electricity Pylons, Belmont Valley
asked the Minister of Fuel and Power if he will institute a public inquiry into the proposal of the British Electricity Authority to carry a line of 136 high super grid pylons through the village of Egerton, Lancashire, and up the Belmont valley.
The British Electricity Authority has as yet made no application to my right hon. Friend in this case, so the question of his instituting a public inquiry has not arisen.
Will my hon. Friend bear in hind, if and when application is made, that the inhabitants of this valley, and indeed of the surrounding industrial towns, are extremely disturbed at the thought that one of the few places of rest and recreation for the industrial workers of Lancashire may be spoiled by something which may no doubt be a very necessary industrial development but which has to be very carefully planned if it is not to spoil this valley?
Those considerations will certainly be taken into account.
As the answer includes a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.
Following are the figures:
Coal
Prices
asked the Minister of Fuel and Power the percentage increase in the price of coal since the industry was nationalised.
The wholesale index for the price of coal shows an increase of about 60 per cent.
Will the hon. Gentleman say what the wholesale index shows as the increase in the price of bulk products for industry produced by private enterprise?
I am afraid I cannot do that.
Will the Parliamentary Secretary look it up? He will find that it is a good deal higher than is the rise in the price of coal.
Was not one of the objectives of the nationalisation of coal supposed to be to give a more economic price for the consumer?
asked the Minister of Fuel and Power what is the greatest extent to which the price of coal varies in different localities.
Except for a few abnormal places, the widest variation in the maximum prices of Group 4 house coal in different parts of the country is between 89s. 1d. and 147s. 11d. per ton.
In view of the fact that the bulk of private commodities are of uniform price throughout the country, could not the same principle be extended to coal?
I do not think so. There are very considerable economic and practical objections to such a course.
Fuel Offices, Bournemouth Area
asked the Minister of Fuel and Power how much he expects to save by amalgamating the fuel offices of Poole, Bournemouth and Christchurch.
£2,000 in a full year.
While thanking my hon. Friend for the letter which he wrote to me on this subject, may I ask if he will look into the matter again in view of the great inconvenience that is being caused?
I have been into this case very carefully indeed, but I am afraid that I am unable to agree with my hon. and gallant Friend that there will be any appreciable increase of inconvenience as a result of this amalgamation.
Legal Aid and Advice Act
43 and 44.
asked the Attorney-General (1) what would be the cost of bringing into operation the provisions of the Legal Aid and Advice Act, 1949, relative to the giving of free legal advice;
(2) what would be the approximate cost of implementing the remainder of the Legal Aid and Advice Act, 1949.
I am afraid I cannot give anything in the nature of precise figures. The cost of bringing into force those parts of the Legal Aid and Advice Act, 1949, not now in operation has been estimated very approximately as between £1 million and £1,250,000 annually. The cost of bringing into force Sections 5 and 7 might be of the order of £500,000 annually.
Can my right hon. and learned Friend say whether there is any reason other than expense for not implementing the rest of this Act? Is he aware that it is in the county court rather than in the High Court that the larger number of cases are arising in which the assistance of this Act would be very helpful?
I will see that the point the hon. and gallant Member has raised is considered.
Can the right hon. and learned Gentleman keep in mind that there will be many more cases going to the county court as a result of the Housing Repairs and Rents Bill that is now passing through the House? Will he try to get legal aid extended to the county courts in time?
I will do my best.
Government Communications Club (Dismissed Cashier)
asked the Secretary of State for Foreign Affairs why Mrs. Avril Luke has been dismissed from her post as cashier at the Government Communications Club, Cheltenham Spa.
I understand that the Committee of this Club, which is an entirely non-official body, decided some time ago to dispense with Mrs. Luke's services for purely domestic reasons. Recently, however, it was learnt by G.C.H.Q. that Mrs. Luke's husband had Communist affiliations and it was therefore suggested to the Club Committee that Mrs. Luke should leave as soon as a suitable replacement could be found. She was accordingly given notice on Friday, 5th March.
Send for McCarthy.
Is the Minister aware that in the letter which informed her that she was sacked this British citizen was thanked for conscientiously carrying out her duties and that the reason why she was dismissed was not because of anything that the Club Committee had found wrong with her but because the Committee was forced to dismiss her? Does the hon. Gentleman think it right that a woman whose only crime was to be the wife of a young Communist should be punished in a free country where Communism is not an offence under the law?
The Government Communications Club is situated in the premises of the Communications Headquarters. This is a confidential organisation which deals with Government telecommunications, and I do not consider it suitable that an employee of the Club should be the wife of a member, former or present, of the Young Communist League.
In view of the very unsatisfactory nature of the answer, I give notice that I shall raise this matter on the Adjournment at the earliest possible opportunity.
U.N. Economic and Technical Assistance (Finance)
asked the Secretary of State for Foreign Affairs whether, in view of the resolution contained in the Second Committee Report A2590, adopted by the Assembly of the United Nations on 7th December, 1953, Her Majesty's Government have yet sent their detailed comments to the Secretary General on the proposal to establish a special United Nations Fund for Economic Development; and whether they have given that proposal their support.
Yes, Sir. In their comments, Her Majesty's Government reiterate the attitude which they have adopted on this question in the United Nations and which was recorded in the White Paper on the Eighth Session of the General Assembly. Briefly, this is that they accept and support the principle of an international fund within the framework of the United Nations, but do not consider that it is practicable to take any immediate steps toward the establishment of such a fund.
asked the Secretary of State for Foreign Affairs whether, in view of the resolution A123, adopted unanimously by the Assembly of the United Nations on 23rd October, 1953, Her Majesty's Government are now prepared to pledge financial support for the technical assistance administration for three years in advance.
No, Sir. Her Majesty's Government have reconsidered this question but have decided that they prefer to continue to deal with the financial commitment on an annual basis. I do not believe that this decision by Her Majesty's Government will hamper the forward planning of the programmes.
Has it not been made plain in the discussions on this matter at the Assembly that it is hampering the programme very much? Will the hon. Gentleman not consider what was said in a recent debate on this subject by his hon. Friend the Member for Bournemouth, East and Christchurch (Mr. N. Nicolson)?
I will consider anything relevant to this matter. I do not agree that the reluctance of the Governments concerned to place their contributions on a forward basis will, as suggested by the right hon. Gentleman, hamper the programme. Incidentally, I understand that the only Government that is prepared to do this is the Government of Indonesia.
Burma (Chinese Nationalist Forces)
asked the Secretary of State for Foreign Affairs whether he was able to discuss the evacuation of Chinese Nationalist troops from Burmese soil with the Burmese Minister of Foreign Affairs during the Minister's recent visit to this country.
Yes, Sir, in general terms.
asked the Secretary of State for Foreign Affairs whether he will make a further statement on the results of the conference in Bangkok, in which the United Kingdom has participated, designed to lead to the evacuation of Chinese Nationalist troops from Burma.
I presume that the hon. Gentleman is referring to the Committee established at Bangkok comprising representatives of Burma, the United States, Siam and the Chinese Nationalists. Although Her Majesty's Government have closely followed the work of this Committee, we have not participated directly. The Committee's work has resulted in the evacuation from Burma of 4,566 persons (including 603 non-combatant dependents) up to 11th March, the latest date for which figures are available.
Whilst that information is partly encouraging, is it not a fact that there are some 9,000 of these Nationalist troops still remaining there? Would it not be a good thing if Her Majesty's Government were to point out to our American allies that the best way to convince South-East Asia that they are not supporting any attempt by Chiang Kaishek to invade the mainland of China is by persuading him to take his troops out of Burma?
The United States Government have co-operated consistently in this Committee, and have done a considerable amount of work to get the results which have been achieved so far, and for which I should have thought the House would wish to express gratification. As to the future, we hope that 150 people will be evacuated every other day until 31st March when the cease fire is due to end. We hope thereafter that the cease fire may be prolonged and further progress made.
As Burma pushed herself out of the British Empire with the assistance of the party opposite, why should we worry about her troubles?
Suez Canal Zone (Incidents)
asked the Secretary of State for Foreign Affairs whether the negotiations with the Egyptian Government have now been renewed; or whether he will propose a date for their renewal.
asked the Secretary of State for Foreign Affairs whether he will make a further statement on the progress of negotiations with the Egyptian Government with regard to the Suez Canal base.
I regret to inform the House that the condition of order and security in the Canal Zone deteriorated very seriously in the past week. There was a number of incidents in which four British officers and men have lost their lives, several others have been wounded and two have disappeared.
An officer of the Egyptian Police Force was shot on 11th March, and it has been suggested that this was responsible for the attacks on our troops. Two British Service men have been placed under arrest by our military authorities and investigations are proceeding. Since this matter is sub judice I can make no further comment. Her Majesty's Ambassador has, however, on my instructions repudiated the suggestion that the death of this officer in any way justified the attacks which have taken place on our troops.
Her Majesty's Ambassador has seen General Neguib and the Egyptian Foreign Minister, and has demanded that the persons responsible should be removed from the Canal Zone. Those found to have been involved in the murders must be tried and adequate measures to prevent the carriage of arms by civilians must be taken immediately.
Her Majesty's Ambassador has on my instructions further made it clear to the Egyptian Government that in the present conditions, which are due to their failure to take the necessary steps to maintain order, a resumption of discussions on the future of the Canal Zone Base is not possible.
I should like to add this. The Egyptian Government have repeatedly asked us to have confidence in them. It is for the Egyptian Government to show by their actions that they are prepared to create the necessary conditions for such confidence.
While all of us on this side of the House fully share the concern which the Foreign Secretary has expressed at these outrages against our troops in the Canal Zone, and we of course recognise that they must constitute obstacles to continued negotiations, may I ask whether it is not unfortunate that no apparent efforts have been made to break the deadlock which has now endured for more than three months? In view of the fact that differences which prevent an agreement appear not to be fundamental, will the Foreign Secretary not seek to resume the negotiations as soon as possible and conduct them himself as he did during the negotiations which led to the 1936 Treaty?
I am obliged to the right hon. and learned Member for the earlier part of his supplementary question. As to delay in reaching agreement, I could not agree. I think that on reflection the the right hon. and learned Member would not wish to make the point that the issues outstanding were not fundamental. That in particular in respect of the availability of the base is fundamental to the whole agreement. I cannot accept that Her Majesty's Government are to blame for failure to reach agreement. There has been quite a lot of "Box and Cox" going on in Cairo which has had an effect on the course of the negotiations, quite apart from tragic events such as these. What I have made plain is that if we are to reach agreement there must be conditions of confidence, and actions must be taken by the Egyptian Government to create those conditions.
Is it not clear that the Foreign Secretary is using these unfortunate incidents to announce and declare a complete change of policy in regard to the Canal Zone negotiations? Is it not the case that all the time, even while negotiations have been in progress, incidents of this kind have been occurring? Although they are sad and tragic, there is nothing new about them and all that is new is the announcement of Her Majesty's Government that they are not going on with the negotiations.
I think the hon. Member is not clearly interpreting what I have just said. On more than one previous occasion negotiations have been interrupted by incidents of this kind. One such case occurred while I was in Berlin and my right hon. and learned Friend made it plain that if that went on conditions for negotiation would be impossible. There was then an improvement. What I have said is clear: While these actions take place against British troops conditions for negotiation are impossible. It is for the Egyptian Government to deal with the local situation and to make negotiations possible.
Trade With China
asked the Secretary of State for Foreign Affairs whether he will call a conference of all countries concerned in the passing and implementation of the United Nations Resolution restricting trade with China, with a view to reinterpreting this Resolution in the light of the changed circumstances.
We hope that the Geneva Conference will open the way for a reconsideration of the strategic embargo on trade with China. Meanwhile it would not be appropriate to open discussions on the United Nations Resolution.
Does the Minister mean by that that it is proposed actually to discuss the strategic embargo on China at the Geneva Conference?
No, Sir. What I said was that we hoped it will open the way for a reconsideration at some other date of the strategic embargo on trade. As the hon. Member knows, Korea and Indo-China are the two subjects for discussion at Geneva.
European Security System (Soviet Proposals)
asked the Secretary of State for Foreign Affairs whether, in view of the recent official speech by Mr. Molotov, Her Majesty's Government will give further consideration to the Soviet proposals for a European security system.
No, Sir. These Soviet proposals were fully considered in Berlin. I have now examined Mr. Molotov's speech of 11th March and his declaration of 5th March. These clearly confirm what I told the House on 24th February, namely that the aim of the Soviet draft Treaty was to break the links between North America and Western Europe, destroy the North Atlantic Treaty Organisation and with it our whole Western defensive security system.
In view of the reference in Mr. Molotov's speech to the European security system, would not the Foreign Secretary make it clear that Her Majesty's Government would support the idea of a collective security system for Europe, but, because both the United States of America and Canada played vital parts in defeating aggression in both world wars, Her Majesty's Government could not agree to any such concept which did not provide for the full participation of the United States of America and Canada?
Our position is that we could not agree to anything which resulted in the abolition of N.A.T.O. Mr. Molotov said in his declaration that N.A.T.O. was like the anti-Comintern Pact and would share the same fate. If that is his view, clearly we are not going to share a security system based on that thought.
As the Foreign Secretary will recall that Mr. Molotov undertook at the Berlin Conference to make a study of the question of mutual compatibility of N.A.T.O. and his European security system, would not the right hon. Gentleman take steps through the usual diplomatic channels to find out whether Mr. Molotov has made further progress with his study and what comments he has now?
I am sure that when Mr. Molotov has made further progress with his study he will be kind enough to tell us. It would be a mistake on my part to try to anticipate the result of his study.
Will the right hon. Gentleman answer my supplementary question? I did not ask that he should necessarily express support of the Russian proposal, but if Her Majesty's Government support the idea of a collective security system for Europe on the lines suggested.
As the right hon. and learned Member, with his experience, well understands, I must be careful that I do not indicate support of a proposal when I know that the object of the proposal is clearly stated to disrupt N.A.T.O. A European collective security system, in principle, might be a very good thing, but, if it means breaking up Western defence, that is a very bad thing.
National Finance
Mutual Security Aid (Grapefruit)
asked the Chancellor of the Exchequer the seasons during which the grapefruit from the United States of America, supplied under Article 550 of the Mutual Security Act, will be imported into the United Kingdom.
:Shipments are expected to start next month and will end by 30th September next.
Income Groups (Families)
asked the Chancellor of the Exchequer how many married couples there were in 1951-52 with one child receiving the second range of income which averages £7 4s. per week; and how many families, in the same range of income during the same period, had two children and how many in the same category had three children.
I would refer the hon. Member to Table 57 of the 96th Report of the Commissioners of Inland Revenue (Cmd. 9030) which gives such estimates as are available of the numbers of families of various sizes in each income range.
Is the Minister aware that under the present family allowance system payments were made in 1952 only in respect of 4,789,000 children and were not paid in respect of 6,216,000? Does it not seem a very unbalanced system of payment? Should it not be revised so that the majority are paid?
None of that appears to arise out of the answer to this Question.
B.O.A.C. Employees (Dispute)
asked the Minister of Labour if he will make a statement on the dispute that has arisen at London Airport in regard to the disposal of Hermes aircraft by the British Overseas Airways Corporation and the declared intention of the workers concerned to refuse to prepare them for handing over.
I understand that this matter was discussed at a meeting of B.O.A.C. and representatives of the unions on 19th March and that the meeting was adjourned until next Thursday.
Would not the Minister of Labour agree that the cause of this dispute is the civil aviation policy pursued by his right hon. Friend? Would not the surest way of settling this matter be for him to consult with his right hon. Friend with a view to changing the policy and preventing the hand-over so that these men can be usefully employed on this national service?
I do not think that it would be useful at this stage for me to say more than that there has been an adjournment of this discussion. I have learned from experience that during an adjournment the less I say the better.
B.O.A.C. (Disposal of Aircraft)
asked the Minister of Transport and Civil Aviation whether, in view of the disposal of four Hermes aircraft at a loss, he will now allow the Corporation to withdraw from the agreement made with him that they refrain from tendering for trooping contracts.
No, Sir. I see no reason to modify the statement I made in answer to the hon. Member for Wellingborough (Mr. Lindgren) on 10th February.
Why will the Minister persist in the policy of disposing of national assets, which can be employed for the national benefit? Why is it that he will not revise his policy, which is proving quite wrong?
I think there is a complete misunderstanding in the mind of the hon. Member. The decision on the field of activity of the Corporations and the independents is a Parliamentary decision, which was supported a fortnight ago by a majority of this House. The decision of whether the Corporation should or should not sell their Hermes aircraft is a commercial decision in the full freedom of the Corporation itself.
The Minister is suggesting that this was a commercial decision of the Corporation. Is it not a fact that the whole purchase of aircraft arrangements are not commercial undertakings so far as the Corporations are concerned, if, in fact, they are to purchase, develop and then dispose of aircraft at a price which is uneconomic to their future?
I think the hon. Gentleman wholly overlooks the fact that these Hermes aircraft have been on offer for world-wide sale for the last six months and that there have been no offers worth while whatever, save from the British independent companies, and it would be indeed foolish if the Corporation did not take up those offers.
rose —
It is past Question time.
Questions
Kenya (Secretary of State's Visit)
I must report briefly to the House on my visit to Kenya. The object of my visit was first, to see how to increase the pressure on the terrorists and bring a quicker end to Mau Mau; my second was to see whether the foundations of the Government of Kenya could be broadened.
As to the first, the success of the security forces in the forests has driven many of the gangs of terrorists into the reserves and in some cases into the settled areas and increased the danger in them. More district officers, more police, more police posts and more and better-equipped Home Guard in the reserves have greatly increased the strength of the net into which the terrorists have been forced. The notable successes since the Parliamentary Report was written perhaps illustrate once again the difficulties of seeing "over the hill."
Again, when I was last in Kenya about nine months ago, nearly all the incidents were initiated by the Mau Mau and the role of our forces was mainly defensive. This has now changed. Two incidents out of three are initiated by us. We have, in short, passed to an offensive rôle. Information which we have obtained from prisoners or from captured leaders shows that the general feeling of the militant part of Mau Mau in several areas, but not all, is that nothing is to be gained by continuing the struggle. It will however be a long time before the mass of the Kikuyu population can be induced to return to normal life and loyalty. It is, meantime, heartening to know that there has been no alarming spread of the infection to other tribes.
The instruments to fight Mau Mau have improved out of all knowledge. The co-operation between the Governor and the Commander-in-Chief, and between the security forces and the civil administration is admirable at all levels. We now have to increase the impact on the terrorists, to provide ever more safety for the loyalists and tighten up the machine wherever we can. The War Council consisting of four people, the Governor, the Deputy-Governor, the Commander-in-Chief and an unofficial minister, is the cutting edge of the Government machine. I must say a word about the example shown by British troops in all these areas. It has greatly improved the feelings of the population towards us: I might add that some of the greetings shouted by smiling children bore unmistakable signs of British military origin.
I now turn to the constitutional proposals set out in the White Paper. The House will remember that the present Government of Kenya is carried on by the Governor, the Deputy-Governor, six official members—that is, colonial civil servants—and two nominated members. This official type of Government does not meet the political realities of today. It is, in any case, desirable that those who live in Kenya should now begin to take a greater share in executive Government. This carries with it the necessity for a multi-racial foundation to that Government.
I shall not weary the House with the immense complications which are inherent in Kenya and her politics today. Kenya is still bleeding from her wounds. The Parliamenary Delegation, in a report for which I am truly grateful, stated, when discussing the question of an interracial conference on constitutional reform:
Let me put it in this way: that to have tried to get wider constitutional changes would have undermined those moderate elements upon whose support any scheme must rest. I suggest that our object must first of all be to sustain and stimulate these moderate elements. To have asked them to go further—now—might well have been to destroy them.
After the proposals were published, the Africans made some counter-proposals of which the House is aware. I felt it my duty to transmit them to the other parties although I could not initiate any further changes to my scheme without breaking faith. The reactions to these counterproposals over 36 hours merely served to confirm the correctness of the Governor's judgment, and the judgment which I had formed myself, that three Europeans, two Asians and one African as Ministers was the largest common measure of agreement which, against the present political background of Kenya, was possible.
Last week, both the Asian groups, the Arabs and the Europeans accepted my scheme in full; the African representative members were unable to accept as a group, but supported its principles and undertook to put no obstacles in the way of individual members of their group who might be offered ministerial or other posts. The proposals mean important advances to Africans. For the first time in East or Central Africa, they are to have a portfolio with full administrative responsibility. Moreover, the idea of appointing two African Parliamentary Secretaries is an attempt to broaden the political class among Africans and to give them the opportunity of acquiring both administrative and Parliamentary knowledge.
These proposals achieve—or so I suggest to the House—the three objects with which they were framed; first, to bring unofficial members into the Government and thus close the ranks in the struggle against Mau Mau; secondly, to ensure that the Government has a multiracial foundation; thirdly, to set up the War Council. They do not, and during these convulsions they cannot, satisfy all the aspirations of any racial group. But even in these times they show that the moderate elements in all races predominate.
I recognise that an advance has been made, and the great efforts of the Secretary of State, but can we call this the greatest measure of common agreement when, apparently, the greatest number of the population will not agree with it. I should like to ask about the African Minister. In his statement the right hon. Gentleman says that this Minister will have full administrative responsibility, but responsibility to whom? Is there not a danger that the African who is given this responsibility will be detached from his representatives? Is there no possibility of getting an African who will be in some way representative, and continuously representative, of the Africans?
Yes, Sir. The answer to the second part of the right hon. Gentleman's question is that there is every chance of a representative African filling this portfolio, who will bear full administrative responsibility, by which I mean that he is a full member of the Council of Ministers and has the same collective administrative responsibility in his sphere as any other Minister.
While agreeing with what has been said by the right hon. Member for Walthamstow, West (Mr. Attlee), may I ask whether we should not have been more likely to sustain and support moderate judgment, to use words which the right hon. Gentleman used, if he could have agreed to the request of the Africans to increase their number, even to a similar number as represent the non-Europeans, the Muslims and the non-Muslims? As it is, the present representation is in inverse proportion to the population.
No, Sir. That was not practicable in the present state of Kenya. In my opinion, which was shared by all the authorities in Kenya, this was the only scheme which we could get through.
While I admit that the right hon. Gentleman has done a vital job for the political advance of Kenya by polarising the white settlers and that we now have a liberal faction led by Michael Blundell co-operating with the coloured communities, may I ask whether the Secretary of State thinks he has played the game by the Africans and, in particular, the loyal and dignified Arab community? Is it not a fact that Mr. Havelock, the chairman of the Electors' Union, said that he might have been in favour of the 4:2:2 formula as opposed to the 3:2:1 formula if it had been put to him earlier? Could not the right hon. Gentleman have given the Africans two places?
First, the Arabs are completely satisfied with the arrangement. Secondly, I cannot answer for Mr. Havelock's opinion, but I certainly do not share it. I repeat that this was the largest common factor which both our judgment and our experience showed to be possible.
The right hon. Gentleman indicated that he could not have got anything else through. Could he give us the reasons why he could not have had one more African in this arrangement?
That is rather difficult to explain in the course of question and answer. However, this is by no means only a matter of moderate European opinion. It affects the representation of the Asian groups and the Arabs.
It is a little difficult to follow the Secretary of State's statement. Did I understand him to say that he could not change the proposals without breaking faith? Does that mean that he had made certain proposals and arranged everything and that it was quite impossible to discuss that with the Africans afterwards? If not, what does it mean?
I should have thought that it would have been quite clear to anybody but the right hon. Gentleman. I conducted a very large number of discussions with all the racial groups, and, therefore, I put forward a scheme which I believed had their acceptance. Consequently, I could not of myself put forward another scheme without reopening the whole matter. That is what I mean when I speak about not breaking faith. All I did was to transmit to all the other parties the counter-proposals of the Africans, and I found them, as I thought I should, unacceptable.
Is it not a fact that a great advance has been made and that the House as a whole feels that a great advance has been made and owes a hearty debt of gratitude to the Secretary of State for his prompt and decisive action in bringing it about?
To follow up the right hon. Gentleman's answer to my right hon. Friend the Member for West Bromwich (Mr. Dugdale), has not the Secretary of State ever heard that a
"soft answer turneth away wrath"?
In this case, there was not even any wrath on the part of my right hon. Friend.
rose —
We cannot debate the matter further at this time.
On a point of order. Might I draw your attention, Mr. Speaker, to the fact that I have on the Order Paper a Question asking the Secretary of State for the Colonies to make a statement arising from his visit to Kenya, and that I have not been permitted to ask a supplementary question?
I will allow the hon. Member to ask his supplementary question.
Is it not a fact that, after the African group made its proposal, the Asian group concurred in the proposal, and if that is so, had not two of the races accepted the proposal? Where was it that the breakdown occurred?
The hon. Member's premises are quite wrong. He refers to the Asian group. There are really two Asian groups.
Orders of the Day
Consiolidated Fund (No. 2) Bill
Order for Second Reading read.
Motion made, and Question proposed, "That the Bill be now read a Second time."
East-West Trade
3.44 p.m.
The debate will probably be more acceptable and less embarrassing to the Government today than it would have been a month or more ago, because after 12 months and more of pressure from this side of the House, the Government have at last begun to move on the subject of East-West trade. I should be glad if I might have the attention of the President of the Board of Trade. I am referring to East-West trade, and it might be desirable if the right hon. Gentleman began to listen to me now.
Week after week over the past 12 months we have had from the President of the Board of Trade nothing but a negative attitude and replies that nothing could be done or that he was discussing with countries in Western Europe the proposal that they should tighten up their strategic restrictions to the same level as our own.
In the last few weeks—we all welcome it—the President of the Board of Trade has suddenly been provoked into action by the Prime Minister. The Prime Minister has, in fact, transformed the Government attitude by one of his unpredictable forays into a subject which does not normally excite him. We all welcome the intervention which was made by the Prime Minister in a debate a month ago. We welcome what he said. Indeed, the Prime Minister is the only Member of the Government who is big enough to stand up to certain of the transatlantic pressures and fears on the question of East-West trade. Therefore, it was very valuable that the Prime Minister made his statement.
To look at the whole picture of East-West trade, it is necessary to go back at any rate to pre-war days. Before the war, trade with Eastern Europe from Britain was never a very large proportion of our total export trade, but it was highly important for certain trades. We got valuable imports of grain. The Soviet Union was the largest source of the supply of softwood timber to this country. Indeed, if we include in the Soviet Union territory the Baltic States and the parts of Finland which are now incorporated in the Soviet Union, before the war they accounted for about 600,000 standards or 30 per cent. of our total softwood imports.
Certain export trades were very much concerned in trade with Eastern Europe. In the early 'thirties, for example, about four-fifths of our machine tool exports went to the Soviet Union and other Eastern European countries. Even in 1938 about 42 per cent, of our total machine tool exports went to the Soviet Union. During the war, trade between the East and the West was very much part of the inter-allied supply arrangements for munitions, combined with the civil supplies agreement which provided for the shipment of certain essential civil supplies from this country to the Soviet Union.
Post-war trade began with the talks between the late Ernest Bevin and Marshal Stalin in March, 1947. It was the initiative of Ernest Bevin—I do not think this is always understood—which led to the trade discussions of that year, to my three visits and to the 1947 trade agreement, an agreement which, when signed and announced in the House, was welcomed by the present Foreign Secretary and denounced by the present Secretary of State for the Colonies.
That agreement, within what it was able to do, was extremely valuable to this country at a time of world shortage. It brought additional supplies of grain and timber and certain other things to meet this country's needs. In fact, in the three years following the new agreement we shipped enough timber for the construction of about 350,000 houses, and about one-third of the feedingstuffs imported during those three years came from the Soviet Union.
It is inevitable that a considerable part of today's debate will relate to the strategic restrictions on shipments to Eastern Europe—
Might I interrupt the right hon. Gentleman in order to be quite clear what he is discussing when he refers to East-West trade? Does he mean exports from this country only, or exports from the Empire and the Commonwealth, which were going forward steadily in 1946 and 1947? We ought to know. When the right hon. Gentleman discusses East-West trade, what group of countries has he in mind? Does he include Russia and China? Unless we are clear about this, what he is saying loses its meaning.
It is a familiar point and one on which one or two of us had to give instruction to the hon. Baronet the Member for Croydon, East (Sir H. Williams) a little time ago. But there has always been a very big trade in raw materials and foodstuffs between the West and the Soviet Union; exports have always been less than our imports from the Soviet Union.
Strategic restrictions date back to 1949. They were originally introduced in this House by myself, as President of the Board of Trade. They were introduced at the time of the Berlin airlift and of the difficulties in international relations which followed it. They were intensified in 1950, after the fighting began in Korea when there was some danger—indeed, very many people felt a very close danger—of the cold war developing into a hot war. Then, in 1951, came the United Nations boycott of trade with China.
It is right that we should get our ideas clear about this question of strategic restrictions. As we all know, there is no simple division between war goods and peace goods. In fact, in war all goods are regarded as strategic, including food—a point very often made during the last war. Certainly, textiles and many other things are, in war-time, regarded as goods of strategic importance which should be controlled. We are all familiar with the point that machine tools can be used either for machining shells or for making bicycles, and rubber can be used for making military vehicles or for making street omnibuses. We are all familiar with these arguments, and it does create a serious difficulty for anyone trying, in peace-time, to maintain a system of strategic restrictions.
In a leading article, more than three years ago, at a time when the House, over a period of two or three days, was debating the question of East-West trading restrictions, "The Times" said that a general blockade, which was the only way to ensure that no goods of strategic value were shipped, was appropriate only when "the point of no return" was passed, that was, when war was imminent. I think that that was very wise advice. It tended a little to restrain the enthusiasm of some hon. Gentlemen opposite who were pressing for almost all-out blockade.
But, obviously, we all realise that there can be no hard-and-fast rule. It must be a question of degree. If we are to allow any trade at all some of it will be of indirect strategic—or potentially strategic—use. What has to be done is to balance economic advantage against questions of defence security—or alleged defence security.
It is not only a matter of degree, but of time. I believe that the years 1949, 1950 and 1951 were a very different period of time from 1953 and 1954. In the earlier period there were many who thought that if war was not actually imminent it was unpleasantly near. Today, however, we are being told all the time that the world situation is improving. The Prime Minister and many Western statesmen have said that the situation now is entirely different. Arms programmes are being cut. Civil defence expenditure which, in any case, was on a scale far too small to be related to any theory that war was imminent, is now being cut by Her Majesty's Government.
Because of that change in world atmosphere I suggest that there is nothing at all inconsistent in Her Majesty's Opposition having supported strategic restrictions in the difficult conditions of 1949 and 1950, and pressing for a very sweeping relaxation of those restrictions in the easier conditions of 1953 and 1954. Wide-ranging strategic controls are appropriate when war or near-war conditions are present, or when there is fear of imminent war.
They are not appropriate in the present conditions to which the Prime Minister has referred in the terms of a "long haul," and about which American writers talk as a period of cold war changing to a period of cold peace—or whatever phrase may be chosen. I prefer to look at it as a period of peaceful co-existence between East and West and of attempts—as the Prime Minister said on 25th February—to improve relations between them.
Some of the strategic controls which are now in force have long ago been seen to be nonsense. On 30th November, 1951, in a debate on the Consolidated Fund Bill, I pointed out that the Soviet Union was shipping goods to this country which were going straight into our strategic stockpiles. The Government were then seeking power to stop the export of strategic goods—but such goods were coming from the Soviet Union. We were getting strategic goods even at that time.
The year 1952 was a year of deterioration in trading relations between this country and the East. Staple imports fell. We had gone back to private buying of timber, but although the private importers were keen enough to import timber from the Soviet Union the Government had a system of quotas which prevented them doing it on any scale. Grain was still on public buying; the Ministry of Food cut imports from the Soviet Union very sharply. There was evidence, indeed, that strategic restrictions and the fall in sterling area commodity prices were reducing Soviet willingness to sell, because they were not so short of sterling as they had been before.
In 1953, there were significant developments in relation to East-West trade. It became clear, through a number of business inquiries in this country, that the Soviet Union were looking forward to a period of expanding imports and exports. As the House knows, I had long talks in Moscow with a number of Soviet trade leaders, and with one of the Soviet deputy premiers, Mr. Mikoyan. I think those were the first talks which anyone in this House had had a chance of having in Soviet Russia in about six years.
One of the things which I obviously wanted to know was about trade under the so-called "new look." It became clear that there was a great desire on the part of the Soviet Union to expand both exports and imports, and there was this entirely new emphasis in their internal economy on consumer goods and on raising the standard of living.
I remember discussing with Mr. Mikoyan the subject of herrings—in which the hon. Member for Aberdeenshire, East (Sir R. Boothby) has been interested—on many occasions. Mr. Mikoyan reminded me that in 1947 I had pressed him every night to buy Scottish and English herrings. He said, "We could not buy them then because we were poor. Now we are buying them and we want to buy consumer goods on a considerable scale," as well as the traditional goods such as ships, hydro-electric equipment, machine tools and other items which had appeared in the trade returns in pre-war days.
He very frankly discussed strategic restrictions. I told him—and I was sure that I spoke for both sides of the House —that there was no question of that being changed until fighting ceased in Korea. He understood. Then I said that I thought the list should be streamlined and confined to genuine military items. The Russians were extremely realistic about this kind of proposal. At the time they were signing a number of trade agreements with France and other countries to import textiles and other goods. It would have been interesting if some of our textiles could have found an opening for export to the Union.
The French agreement provided for shipments from the Soviet Union of quantities of chrome, manganese and asbestos, which, as a French newspaper "Liberation" pointed out at the time, were goods which up to then France had only been able to buy direct from the United States at very high prices. This newspaper went on to say that these were all goods which, under the Battle Act, the French were not permitted to export to the Soviet Union. So we had the anomalous position of the Battle Act saying, "You cannot export these materials to the Soviet Union," and the Soviet Union themselves exporting them to France.
What was the date of that agreement?
This agreement was dated September, 1953. During the negotiations on that agreement—and I am mentioning the French case because I think it a great pity that we have not a similar agreement with the Soviet Union—I understand that the United States authorities were very anxious that there should be no reference to ships. But the French Government insisted on including the provisions about ships, and there was no further trouble about it.
I think that last autumn most of us who were reviewing this question of East-West trade would have taken the view, first, that a big expansion in trade was possible because of the changed economic policy in the Soviet Union. Secondly, I think we would all have felt that East-West trade could help us with our dollar problems. I have never said that it would solve all our dollar problems, but it could go a long way towards solving them.
It would make a contribution towards enabling us to make a saving in dollars on such materials as grain, limber and certain metals. I have felt that more East-West trade would be very valuable for this country in finding markets for some of our industries facing the prospect of a shrinking trade in the West, particularly our engineering industries, but also, to some extent, textiles and some of the consumer goods industries.
That seemed to be the position last autumn. Yet the Government made no move at all at that time to encourage East-West trade. We got a few phrases from the right hon. Gentleman which vaguely encouraged it, but, as far as any action was concerned, all that the Government did was to pursue a masterly policy of decisively waiting upon events, and chiefly events in the United States. Even though the Korean Armistice had been signed in July, nothing was being done about developing trade with China. Yet it was clear on all hands that the strategic controls were breaking down, and that there were widespread evasions.
One read several times that Switzer-lad was rapidly becoming the centre of entrepôt trade in goods that appeared on the strategic list. Many other Western European countries were also breaking loose from these strategic controls. In fact, circumventing the Battle Act became one of the main industries of Western Europe. But whenever we brought these examples to the attention of the President of the Board of Trade, all he said was that he would try to get others to tighten up their controls. He never once said that he would get this Government to loosen up their controls. His policy was a policy of equality of misery, like the fox in Aesop's fable who lost his tail and who wanted to persuade all the other foxes to lose theirs as well.
We had many examples of evasions and contradictions in the operation of the strategic restrictions, not by the British Government, but by other countries—too many to mention. There was the famous case of the copper wire. Copper wire that was not insulated was banned under the strategic controls. But the Soviet Union and certain other countries wanted some of this wire for trolley-bus and tramcar cables, and everyone knows that trolleybuses and tramcars are not normally used on a battlefield.
All the same, we were not allowed to send that copper wire. Other countries were not quite so scrupulous. They covered it in a "phoney" form of insulation which was easy to strip off. But it soon became clear that it was unrealistic and expensive to do this, because Soviet workmen had to sit down with a pair of pliers and strip off the insulation before the wire could be used.
Because of this, one or two enterprising manufacturers in Western Europe began producing prefabricated insulation, supplying special machinery and tools for stripping it off, and in one case a kind of paper insulation was produced with a sort of zipp fastener which enabled the insulation to be easily removed at very little additional cost. But all this time our own Government were standing firm on the list, although they made one or two belated though welcome concessions about antibiotics to China. I remember the right hon. Gentleman being questioned about some cinema lighting equipment going to China. He made it quite clear that so long as the list remained, it would be impossible to deal with the case.
Then came the visit of the businessmen to Moscow. Of course, they got into trouble with the Foreign Secretary because they bought their tickets from the wrong travel agency. Apparently, the Foreign Secretary had so little confidence in the ability of British businessmen to hold firm to their political views when they met Communists that he said it would be quite wrong if they went to Moscow on tickets bought from this organisation which he regarded as a Communist front organisation. It was all right for them to go to Moscow if they got the tickets from someone else, but not if they got them from the British Council. I am not this afternoon holding any brief for the British Council, but the point was—
The right hon. Gentleman is confusing the British Council with Lord Boyd Orr.
I used the name British Council instead of saying the British Council for the Promotion of International Trade. At that time, it was the only active body in trade with Eastern Europe and China, and at that time the Government were extremely inactive. But this suggestion that it was a Communist organisation, when it had a Nobel Peace prize winner as its chairman and a number of distinguished academic persons, including some recently employed on Foreign Office work among its numbers, was just ludicrous.
However, the Cohn-and-Schine department of the Foreign Office go to work and these businessmen were prevented from going under the aegis of this body. Then they got tickets from the right agency and were allowed to go to Moscow. There is no doubt that their visit was a great success, and I think great tribute ought to be paid to Mr. Scott and those who went with him on the way they handled these discussions.
Then we had the situation of 33 businessmen coming back from Moscow and saying all that some hon. Members on this side of the House had been saying for a considerable time, but saying it with the authority of those actually engaged in detailed trade negotiations with the Soviet Union. The strange thing was—and this must have been very shocking to the Foreign Secretary—that these men were dealing with Communists every day in the Soviet Union because that sort of thing happens there. But, so far as I know, not one of these 33 businessmen was a Communist, or even a Socialist. What they were was thoroughly wide awake to the possibilities of East-West trade, and they have come back with a mission to spread the case for trade between East and West.
It was during their visit that a statement was made by Mr. Kabanov, the Soviet Minister of Foreign Trade, about the prospects of trade with this country. He held out hopes that trade deals could be signed providing for the importation into the Soviet Union of goods to the value of 4,500 million roubles, that is about £400 million at the official rate of exchange, as the right hon. Gentleman told us. Within that total there was about £140 million of ships, £55 million of power equipment, £36 million of machine tools and £22 million of textile machinery. One has only to look at this last figure to realise what this means to the manufacturers of textile machinery who only two years ago were facing a very difficult and discouraging future.
Surely the figures which the right hon. Gentleman has just quoted, and the statement which he has just made, prove conclusively that one does not have to deal through a Communist penetrated propaganda organisation to get trade with the Soviet Union. That is what my right hon. Friend the Foreign Secretary was seeking to ensure, and that, according to the right hon. Gentleman's own admission, is precisely what we hope has been achieved by that mission to Moscow.
I do not agree with the hon. Gentleman that it is a Communist penetrated propaganda organisation, or a Communist dominated organisation. I say that this trade would not have taken place if it had not been for the initiative of this body in originating the proposal. Then, because of the Foreign Secretary's intervention, there was a delay. Missions do not need to make arrangements through this organisation. There are now many businessmen in Moscow, and other organisations are capable of handling this situation, including the Russo-British Chamber of Commerce and various trade associations.
Is it not the case that nobody ever suggested that the British Council for the Promotion of International Trade was a trading organisation, or that anyone should trade through it? All that the Council did was to facilitate arrangements and make contacts, and it is those contacts which have now fructified in trade with Russia.
My point is that when the Government were doing nothing to promote trade between East and West, this body was the only one which seemed to be taking action, and the Foreign Secretary attempted to discourage the arrangements which had been made with it. It is quite clear that, in the future, trade can be developed with the Soviet Union, and there are old-established bodies and trade associations which are quite capable of making the necessary arrangements, given help from the Board of Trade. Within the totals of the Kabanov figures, provision was made for the import of raw materials, foodstuffs and consumer goods to the tune of over £100 million.
With these developments, East-West trade has at last become respectable, and the things which some of us said a year ago, and which were regarded as highly doubtful if not treasonable, are now being said in the most respectable quarters, and being widely publicised. We have had a statement by Mr. Stassen, in the United States, and we have had the Randall Report. We have even had the statement of the Chancellor of the Exchequer, when he was passing through South-East Asia on his way to Sydney. The Chancellor realised then, if he had not realised before, the futility of spending millions of pounds fighting Communism in Asia while his own strategic restrictions were depressing the price of tin, rubber and other primary commodities, thus depressing living standards and creating the very conditions in which Communism can live and thrive.
The seal of respectability on East-West trade was set by the Prime Minister, a month ago, when he said:
There has been a change not only in the climate of opinion, but in the facts. A short while ago the Minister of State, Board of Trade, told us that about £10 million worth of Soviet strategic materials had been imported by us last year, including iridium and platinum. Last autumn, when I said that I did not think that East-West trade could make a major contribution to the solution of our dollar problem, I was not allowing for another new development, namely, the shipment of gold from the Soviet Union to this country.
In the last quarter of last year we got about £35 million worth of Soviet gold, plus some more that came in by way of Continental sales. It is quite clear that if it had not been for this Soviet gold our gold and dollar reserves would have fallen during the past four months, even with all our receipts of American aid. Even Tory newspapers had to admit that our dollar reserves were being maintained by Red gold. Even the ranks of Tuscany had to make that admission.
The Government preen themselves on having been able to maintain these reserves, but they must admit that they have done it by the importation of Russian gold. The Chancellor realises that even Russian gold is worth its weight in dollars these days. I am sure that the Chancellor would agree that if our reserves had fallen, even by a small amount, during that critical period, there might have been a loss of confidence in the sterling position. When the recession was developing in America, a fall in our dollar reserves might have meant a loss of confidence and a run against sterling, so this Soviet gold has had a good effect on our balance of payments, even if the gold has to be melted down and the hammer and sickle removed before it can be exported to the United States. This trade can give us dollar saving materials and gold.
What do the Government think about the prospects of developing East-West trade? What are they doing? We have had one or two quite encouraging signs in the last fortnight. The Economic Commission for Europe welcomed the resolution of the joint Anglo-Soviet delegates. Although that resolution does not say much, it does say:
We are also told that in the coordinating committee, the so-called "Cocom," in Paris, the Government have raised the question of strategic restrictions. We all welcome the fact that this is being done through the Paris Com- mittee. It is right to proceed as far as we can by agreement with other European countries, rather than allowing individual countries to take action, so long as agreement is reasonably quick and effective. If it is not, I hope that the Government will stick to what they believe is right in the economic interests of this country, and get on with streamlining these restrictions.
What instructions has the President of the Board of Trade given to our representatives on this Paris Committee? He has delayed very long, and I hope that he will now treat it as a matter of urgency, because orders may be lost. The President probably already knows that the machine tool industries need an urgent answer to the question of the strategic restrictions. They have the problem of laying out their works for large-scale orders which will last for years ahead, and if the President is not quick with an answer they may lose the prospect of markets which can preserve full employment for them and their workers for many years ahead.
I want to suggest three points for the Government's consideration. First, they should adopt a new attitude towards strategic controls. I am sure they now recognise that the existing controls are self-defeating, and are dividing rather than uniting the West. I hope the Government realise that we are getting strategic goods from the Soviet Union. In the past few weeks they have offered to our British Iron and Steel Federation large quantities of manganese ore, which is certainly on the right hon. Gentleman's strategic list.
We are not in any way limiting the military potential of other countries by these strategic restrictions. They can get these goods elsewhere. If we do not ship machine tools to Russia she will set up capacity herself to create those tools. I ask the right hon. Gentleman which he thinks is more in the interests of our defence, that we should, by shipping machine tools, maintain the capacity of our own machine tool industry, or encourage other countries to set up their own machine tool industries?
It is exactly the argument that the right hon. Gentleman and other Ministers have used about aircraft. They have said that, to maintain the capacity of the British aircraft industry, they must export aircraft abroad because capacity is more important than current production. If that is true of aircraft—and it is an arguable point about aircraft—it is certainly true of machine tools.
A great deal of the arms programme in the last three years has been devoted to the expansion of capacity. It is important for defence to maintain that capacity in being. Therefore, I hope that the right hon. Gentleman, in redrawing his strategic list, will restrict it for the most part to direct military items—atomic energy, research into atomic affairs, jet aircraft, guided missiles, weapons and things directly concerned with weapons—and not try to carry on a semi-blockade against Eastern Europe.
My second proposition to the right hon. Gentleman is that the Government should now enter into discussion with the Soviet Government for a trade agreement in continuation of the 1947 trade agreement. I know that his position in negotiating such an agreement has been weakened to some extent by the reversion to private buying. I do not think there is a problem so far as timber is concerned because Soviet timber is so popular in this country that it will always be bought by our importers—and bought at a premium, as it is being bought at a premium.
Perhaps the subject of cotton is a more doubtful one, but one notices that a prominent cotton merchant has been to Moscow and has concluded arrangements for importing large quantities of cotton. I am doubtful whether the right hon. Gentleman will be able to give any assurance to the Soviet Union about grain because of the reopening of the grain markets.
That is the big change that has occurred since 1947. In 1947, the Soviet Union was shipping scarce goods such as timber and grain to us, and was demanding or, at any rate, hoping, that we would guarantee the shipment of industrial equipment from this country to the Soviet Union. Now the situation is entirely different. The Soviet Union wants to take orders for our industrial equipment and would like an assurance that we shall be willing to buy its produce such as grain and timber. I hope that the right hon. Gentleman will be able to give some such assurance.
We welcome the trade discussions now starting with Hungary, with Poland and with Czechoslovakia, and we feel that the right hon. Gentleman should also have trade discussions with the Soviet Union. The Soviet Union has signed trade agreements with many countries, France, India, Japan, and others. It is the best way to get some planned trade and to make certain that there will be imports of consumer goods into this country. I suggest to the right hon. Gentleman that if he wants the necessary confidence in a new drive in East-West trade he should enter into these talks with the Soviet Union, and at the ministerial level.
My third proposition concerns China. The Prime Minister's statement excluded China from the proposals about an easement of the restrictions. I believe that the repeal of the United Nations boycott on trade with China is very long overdue. Last year there was a visit of businessmen to China. I do not want to upset the Under-Secretary of State for Foreign Affairs by saying under whose auspices they went, but it was a very valuable visit, and they came back with large orders, practically all of which have had to be cancelled because of the Government's strategic list. I suggest to the right hon. Gentleman that it is now time to put trade with China on the same basis in terms of strategic restrictions as trade with the Soviet Union.
I hope that the right hon. Gentleman will not make any mistake about this. American businessmen and Japanese businessmen are already very active about the China market. We suspect that the Government are afraid to move an inch in the matter of trade with China because they fear they will get into trouble with some United States senators. I hope that the right hon. Gentleman will realise that—though we do not complain about this, nevertheless, public affairs in the United States are carried on in a much more schizophrenic way than they are in this country.
In this country our businessmen follow Government policy, no matter who the Government of the day may be. In the United States there is the rather strange position that the Government of the day preach virtue and rebuke the slightest deviation in other countries while the businessmen are always ready to go in for sin in a big way. When one says anything to the Government of the United States about it they say, "That is being done by businessmen. It has nothing to do with us." The danger is, I feel, that through fear of incurring the wrath of one or two recently discredited demagogues in the United States Senate we shall be kept in this strait-laced atmosphere while United States businessmen are moving into the Chinese market.
We welcome the Government's belated, faltering moves so far as they go. We fear they do not go far enough, and that British industry and employment in Britain will be sacrificed to "phoney" political considerations and to the "taboos" and blockade mentality of those people in the United States and elsewhere who tend to think of the whole world problem in terms of a crusade against Communism.
As I have said, I do not believe more East-West trade of itself will solve all our economic problems, but it can make a contribution to solving those problems and it can make a real contribution to peace. The Prime Minister said, a month ago:
I hope that the Government will not be satisfied with simply listening to the Prime Minister's saying these things, but will act on what he said. So far in the matter of East-West trade all we have had from the right hon. Gentleman is "Words, words, words." Let us now have some action.
4.28 p.m.
I think it may be convenient for the House if I intervene in the debate now to make some comments on the subject that has been chosen for discussion. There are, as the right hon. Gentleman knows, plenty of ways of approaching this subject, which can be an explosive topic both inside and outside the House. Any speaker who wishes to do so can find points of controversy if he wants to look for them, but I believe that the best service anyone can do in debating this subject is to introduce the minimum of controversy.
The last words have not been said upon East-West trade. It has been for a long time, and probably for a long time will be, a very great national and international problem. Certainly, for my part, I intend to be non-controversial. At least, I think I shall be. I intend to be non-controversial because there are certain objectives which we wish to achieve in this field, and we are much more likely to achieve those objectives if we approach the matter in a spirit of calm and reason than in one of recrimination.
The Government have for a considerable period now been considering the problem of East-West trade. In the last few weeks we have taken an important initiative in this field of policy. I think the House will appreciate—certainly those who have had intimate dealings with this subject will appreciate—that there is a limit to the amount of detail about that initiative into which I can usefully enter at this stage. We are at the outset of discussions on this subject with our friends, and I am sure that no one would wish to prejudice those discussions. What I can and will do is to say something about the background to the policy and the general principles which have guided us in arriving at the policy which we have adopted.
As the right hon. Gentleman said, our system of export controls was introduced, and properly introduced, by the previous Government in 1949. They were expanded, and properly expanded, by the previous Government shortly after the outbreak of the Korean war. There is nothing inconsistent in the right hon. Gentleman, having introduced export restrictions of that character at that time, supporting us when we seek a relaxation of those restrictions at the present time. If it marks, as he seemed to think it did, an improvement in the world outlook, that was a tribute to the Foreign Secretary which I will not dispute at all, but there is no reason at all why the right hon. Gentleman should not have supported restrictions at one time and then lend us support in our policy some years later.
Under the arrangements which he introduced, there was set up a complex network of trade restrictions. Some goods were placed on total embargo, other goods were subject to quantitative restrictions and others, again, were subject to discussion between the Powers as to the amount which was to be exported. Clearly, if such a system were to be either effective or tolerable, it was very desirable that, as far as possible, all should adhere to it. The British Government took a leading part in setting up the consultative group of Western nations who consider these matters. The purpose of that group should be made quite plain. Its purpose was to co-ordinate and unify security controls in order to remove discrepancies in the selection and the treatment of the various items. That group is advisory and not executive in its character.
The right hon. Gentleman said the system did not work perfectly. Of course it did not. It did not work fully adequately under the previous Government and it did not work perfectly under this Government. No system as wide and complex as this system could work perfectly, but I think we can say that where there were gaps the British Government have always shown themselves willing to try to stop them, for example, by the introduction of transshipment control in United Kingdom ports and other measures of that character. The United Kingdom has taken a leading part in these arrangements. We have loyally adhered to them. On the whole, the Western nations have stuck to a common policy.
We have done so because we felt that it was in the interests of ourselves and of our friends that joint arrangements of this kind should be made to safeguard the security of the West. What we have now to consider is whether, consistent with security considerations, some alteration in trade policy with the Soviet bloc, excluding China, is possible. I said, "excluding China"; my right hon. Friend the Prime Minister made that quite clear the other day and my right hon. Friend the Foreign Secretary made it clear again this afternoon in answering a Question.
I think the starting point of the argument as to what relaxations can be made is to consider coldly and dispassionately the commercial consequences of the condition which the right hon. Gentleman called "the cold war" at the present time. I am not here concerned to debate or discuss the reasons which divide the world into two uneasy halves. That is a matter for a foreign policy debate rather than a trade debate. I am concerned with the trading consequences of these events, and I think we should look closely at those consequences.
The plain fact is, of course, that if the world is divided into two separate halves it is an unhealthy world for world trade. It is like putting a tourniquet around the body; the tighter we squeeze it, the more uncomfortable it is for each half—and I emphasise, "each half." The truth is that a close limitation of the normal channels of trade has an effect which is not limited to one nation or even one group of nations.
The East is denied, or denied in part, a valuable source of manufactured goods and industrial raw materials of a peaceful character. Any increase in her standard of life is retarded pro tanto by the limitation of trade in peaceful goods. Let me say this: the West is similarly affected. We are affected in our search for such commodities as timber and grain, of which the East is a traditional supplier. The West, like the East, is denied both a market and a source of supply and is compelled to turn her trade inwards upon herself. The narrowing of the West's sources of supply certainly increases her exchange and other difficulties to an appreciable extent and the narrowing of her markets adds to the severity of competition which individual nations experience.
In those circumstances, I think we start from the position that it is very much to the interest both of the East and the West to restrict the limitations of trade to those purposes which they regard as necessary for their particular interests. For the West, our interests are to restrict for the purposes of military security. In the case of the East, the Eastern nations have so far pursued autarchic arrangements; they have pursued a deliberate policy of self-sufficiency, and certainly if the East desires to widen the area of her trade beyond her frontiers that will involve a considerable reorientation of the use of her resources.
I should like to turn to what has happened to trade in recent years. In general, it can be said that trade with the East in strategically important items has been limited or denied, and trade generally with the East has certainly declined. Imports from Russia were £60 million in 1951; £58 million in 1952; and down to £40 million in 1953. Our exports to Russia from the United Kingdom—I am not talking of the sterling area at the moment—are down to only about £3 million or £4 million annually.
If we look at the picture generally we can certainly observe a large switch of trade away from the Iron Curtain countries, partly due to strategic controls and partly due to the autarchic systems within those countries themselves. Before the war the United Kingdom used to export to the Soviet bloc about 4 per cent. of her total exports. Today, that is down to about ½ per cent. Before the war Germany exported approximately 12½ per cent. of her total exports to Russia. That is now down to 1 per cent., although it is worth remembering that before the war it was a united Germany. Before the war Japan exported about 30 per cent. of her total trade. That is now down to about ½ per cent.
Thirty per cent. to Russia?
I should have said to the Chinese mainland in the case of Japan.
Would the right hon. Gentleman give these figures in actual amounts and not merely the percentages?
No. For one reason I have not got them by me, and for another reason they would be almost meaningless because the value of currency has changed. There are, however, signs from the Geneva Conference that the Eastern European countries and Russia are now willing to do more trade with the West.
The right hon. Gentleman referred to the visit of the businessmen led by Mr. Scott. I should like to echo the tribute he paid to Mr. Scott, who discharged a by no means easy task extremely well. As a result of that visit, we have been notified in the Board of Trade of about £12½ million of firm orders, and of these about £6½ million have so far been approved for export. In addition, there are 20 trawlers to a value of £6 million and £1¼ million worth of textile-machinery. A number of businessmen, quite apart from Mr. Scott's mission, are still in Moscow. If one is doing trade it is reasonable for individual businessmen to go and do it in the ordinary way.
Have the trawlers been approved?
Yes, these trawlers have been approved.
There are a number of further inquiries in the case of both shipping and other articles. All these visits were, of course, made with our complete approval. My Department gave every assistance to these businessmen before they went and every help will be given them as to whether they can get licences for their goods as soon as they return within the limits of the complex controls in operation.
Sir Greville Maginness, the chairman of a large machine tool manufacturers, and Mr. Tearle, export manager of Metropolitan Vickers and associated companies, are in Moscow now. Can the President say whether they are being given every facility to negotiate the maximum orders now that they are there?
I am sure that I can give that assurance. It is widely known to all industrialists that any help that we can give them in preparation for a visit to Soviet Russia will, of course, be given, and in the case of Sir Greville Maginness he is very experienced in that field already.
Can my right hon. Friend say whether any help which he gives them is to include the giving of licences?
I think that my hon. Friend may have missed my last sentence, when I said that when they return our aim is to see that where possible their goods are cleared for licences as speedily as possible within the present complex of controls which are in operation.
It was during the visit of Mr. Scott and his party that Mr. Kabanov, the Minister of Foreign Trade, handed them the list of items to which the right hon. Gentleman referred.
I should like to say a word now on what are the possibilities of trade in the future. A whole variety of figures have been mentioned. My own judgment is this. I believe that no one can give any reliable estimate at all of what trade may, in certain circumstances, develop with the Soviet Union.
The pre-war figures are certainly not reliable. This is, after all, a different world from the pre-war world with needs differing from the pre-war needs. In any event, Russia's ability to buy and what she buys will depend very largely on the economic policy which she herself pursues. What is certain is that Russia is a substantial potential market for goods not only from the United Kingdom but from the rest of the world. I think that we should neither exaggerate nor minimise the possibilities, but here is a vast area with a great number of people seeking the means to develop in a world in which there are many obstacles to trade expansion, and here is an area in which trade can be expanded within reasonable limits.
Against this background we have been considering what measures could usefully be taken to help that expansion. An example is, of course, the visit of the businessmen themselves. As I have said, if we want to develop trade, it is quite a good thing to have businessmen there and ready to develop it.
Will the President get down to details.
At the same time, we must recognise—I think this is the hon. Gentleman's point—that one of the obstacles is the present size, complexity and content of the strategic lists. I emphasise their present size because it is the very size of the lists which makes both enforcement difficult and, at the same time, limits trade in the peaceful categories, which fall just inside or just outside the list.
That is much more complex.
That is what I think. What we must now consider is how safely we can vary them. It is not in the interest of the United Kingdom to further trade in potential weapons of war. Security in these matters, is, after all, a major British interest. We are part of the free world. Indeed, on our record and by our geographical position, we are in the forefront of it. We have been certainly giving full weight to these considerations. Our policy is not dictated by short-term commercial advantage. What we have to consider is a policy which has regard to the needs of Ministers representing all aspects of Government, including, of course, the Minister of Defence and the Service Ministers.
Having considered these matters with great care, because they deserve consideration with great care, the view of Her Majesty's Government, as expressed by my right hon. Friend the Prime Minister on 25th February, is that a substantial relaxation of the strategic controls would undoubtedly be beneficial. We are quite clear in our own minds as to what is the right and proper approach to this subject, and we are in the process of putting our detailed proposals before our friends.
We believe it to be possible to combine an enforceable list of security controls on goods of real strategic importance with relaxations on other goods and an expansion of trade in them. I do not believe that much difference should exist on the principle here involved. I hope that we can deny goods of real military value, but not engage or acquiesce in what might become a long-term, loose and ineffective economic blockade of Russia.
I should like to say one word as to the organisation of trade. My right hon. and noble Friend Lord Reading has just returned from a meeting at Geneva of the Economic Commission for Europe to which the right hon. Gentleman referred. On that, my noble Friend emphasised that the Economic Commission was not the right place to debate the Western strategic controls, but he did emphasise our desire to extend trade in the peaceful sectors. A joint Anglo-Russian resolution was adopted with general support, including support from the U.S.A., the main purpose of which was to confirm that discussion should be renewed on 20th April on a variety of topics, including the problems associated with any multilateral trade and payment arrangements.
I think that the House will agree that these discussions took a useful and practical form. There are, of course, arguments for and against a formalised trade agreement. The previous Government had a formal agreement in 1947 negotiated by them. It was allowed to lapse the next year, probably for perfectly good reasons. So far as I am concerned, I have not a closed mind on this subject. If some form of trade agreement should prove useful, I see no reason why we should not seek it.
What matters is not so much the formal instruments as the desire and ability to trade. The Russians appear to be considering a rearrangement of their policies which would enable them to earn more currency abroad. We are giving renewed consideration to the scope of our export controls, and a combination of these factors should make an advance on the commercial front possible. These are the matters which fall for discussion this afternoon.
The right hon. Gentleman is wrong to say that the 1947 agreement lapsed the following year; it did not. Quite apart from that, will the right hon. Gentleman deal with this point; does he realise the urgency of giving a very quick answer on the machine tool export licences, which is an urgent matter? Secondly, instead of simply dismissing the China problem by a quotation from the Prime Minister, will the President say why it is not now possible to enter into similar relations with China that we intend to have with the Soviet Union?
The right hon. Gentleman is wrong. The agreement did lapse the following year. I will give him particulars afterwards. On China, I refer the right hon. Gentleman to the full answer given at Question time today by my right hon. Friend the Foreign Secretary, to which I have nothing to add. With regard to the speed with which answers can be given within the existing controls, I share the wish, which, I think, is felt on all sides of the House, that answers should be given as quickly as possible. One of the problems, however, is that there is a very complex arrangement of controls, and it is to that problem that I have been directing my remarks this afternoon.
We shall be discussing these subjects in the debate this evening and I am confident that our discussions, as always, will illuminate the problem. I have one request to make to the House, and I am sure hon. Members will not misunderstand me. I have no doubt that in their speeches hon. Members will remember that the Government are now at the outset of difficult, and sometimes delicate, discussions on the whole of this subject, and I think that a measure of restraint would add rather than detract from the force of the arguments we use. For our part, we have already taken the initiative, and we intend to press on with it. We shall do so with a full sense of the security considerations involved, but, equally, with the full intention of bringing about the maximum degree of trade that lies within our power.
4.53 p.m.
The House will not feel that it knows very much more about East-West trade now than before the President of the Board of Trade began his speech. The right hon. Gentleman spent a good deal of time very carefully trying to say absolutely nothing. All we got from him in the end was that he hoped that some of the strategic controls would be revised. He would not tell us the Government's views on the strategic controls, because he thought that to do so would be bad for the negotiations now taking place.
His reason was that if those with whom we are negotiating knew what we wanted, they would in some mysterious way be put off letting us have it. That is a very upside-down method of treating negotiations, and it is a discourteous way of treating the House of Commons. It might have been better had the President not intervened in the debate but had allowed it to proceed on its normal course and then answered some of the points at the end.
As my right hon. Friend the Member for Huyton (Mr. H. Wilson), the former President of the Board of Trade, said this afternoon, we must watch the matter of East-West trade with care and exactness and realistically. The Russians and the Communists generally will only trade with us provided that they can get the maximum benefit to themselves politically and economically. That is not unreasonable, and it probably applies to us in reverse.
So far, the whole trend of post-war trade between East and West has been, as the right hon. Gentleman said, to make the Soviet bloc, with its satellite countries, self-sufficient. It is worth remembering that at the 19th Communist Party Congress, in the last speech which he made to a Congress, Stalin remarked on the industrialisation of the Soviet bloc and said:
But now there is a definite change, for the moment at any rate. Certainly they have departed from the rather rigid postwar policy which has been adopted so far. The main reason for this, I think, is the need for increased consumer goods in Russia, and also the tremendous failure of their agricultural policy, which, perhaps, will demand imports of food from other countries.
The last report of the Economic Commission for Europe said that the grain and potato harvests in Russia for the last five years have been below the 1934–38 average. That is a serious consideration for a country like Russia, the population of which is increasing all the time. Also, in 1953, there were apparently fewer livestock in Russia than in 1916, despite a 30 per cent, increase in population.
But as well as these economic reasons for increased trade with the West, there may also be an internal political motive; and we should not lose sight of that. We must never rule out the possibility that there is a group in the Kremlin anxious to persuade their colleagues that the world Communist revolution is unnecessary, that it might not be a good idea to follow too relentlessly the idea of a world Communist revolution, and that Russia can live without war with the free countries. We should do everything we can to encourage such tendencies and ways of thinking, if there be such in Russia, in the highest Communist quarters. Certainly, we shall not encourage them if we do not attempt to meet with warmth any proposals which they make for increased trade.
But because there is a change in Russia, we should not believe that it will go far enough to offset dollar markets and other world markets. Before the war, not more than 3 per cent, of our exports went to what is now the Soviet bloc, and from Russia and the Soviet bloc came only 6 per cent, of our imports. We should not, therefore, be too optimistic, particularly as far as getting grain, timber and dairy products from Russia and her satellite countries is concerned.
The Russians have the advantage over us in that they can switch trade with foreign countries on and off just as they like, without reference to public opinion, as was done in the case of Yugoslavia. We in this country do not do that, and we could not do it. It would be unwise to become too dependent in any field of manufacture on Russian trade. But certainly some increased trade with Russia will be done, and it will go to someone. We in this country are not setting about getting it in the right way. We are not setting about getting this trade half as vigorously or intelligently as we should.
The strategic control is largely pointless, because, apart from actual munitions—guns, tanks, aeroplanes; obvious instruments of war—almost anything can be used to bolster up a nation's economy so as to make it able to wage war more effectively. This applies to almost any article of trade. If a nation has more of certain items, it is better equipped economically and, therefore, better able to wage war; and so most of our restrictions have become absurd.
Nobody suggests that we should actually export munitions of war—not even the Russians suggest that. What I do suggest is that our restrictions should be vigorously reviewed and cut down in number, because one of the great difficulties is not merely the complexity, but the fact that most businessmen do not even know, and cannot find out, what the restrictions are. When businessmen are trying to get orders from the Russians or Chinese, they do not know whether, when they get home, they will be able to fulfil the orders, because there is no published list.
Some of our regulations have become ridiculous. One of them says that the Russians may buy tankers of 5,000 tons weight, but not of 10,000 tons weight. What does that mean? Two 5,000-ton tankers are just as good as one 10,000-ton tanker, and, in fact, are better in war because if a nation has two tankers and one is sunk it still possesses one, whereas if it has only one 10,000-ton tanker and it is lost, the whole 10,000 tons have gone. It is a peculiarly pointless regulation to maintain now. I believe that the Russian trade delegation has been making inquiries of the Admiralty as to the possibility of purchasing now some 10,000-ton tankers. I do not know if we can be told later what the answer has been.
Again, there is an absurd regulation which says that a trawler may not be bought if it goes faster than eight knots an hour. The reason for that is that it might be turned into a minesweeper. That seems an unlikely project, and it is unnecessary to legislate against it at this stage.
The strategic controls exercised against Russia are foolish enough in many respects, but the restrictions against the Chinese are completely ludicrous. The President of the Board of Trade persistently maintained that nothing is to be done about the embargoes on China until after the Geneva Conference, and presumably until there is some move towards signing a peace in Korea.
The Government ought to have regard to the situation in which that resolution was passed by the United Nations in June, 1951. That situation was totally different from that of today. Then the Chinese had just gone into Korea. They were fighting against our troops and, indeed, they had almost got to the southern end of Korea. Today there is no fighting in that country, and there seems to be no particular reason for having more stringent controls against the Chinese than against the Russians.
When the delegation of businessmen went recently to China they brought back a large number of orders, certainly worth about £5 million, which could have been fulfilled had they come from Russia, but could not be fulfilled because they were for China. This distinction now makes no sense whatsoever, but our Government have persistently refused to take the initiative in calling together the other countries concerned to try and get this resolution revised and make it more realistic.
Again, we do not seem to be adopting the right attitude to secure orders and to get trade with Russia or with China. We have heard a reference this afternoon to the British Council for the Promotion of International Trade. The Government's objection to this body, which at one time was the only body doing anything about trying to arrange for visits of British businessmen to Peking and to Moscow, was that some Communists were members, and that the council might be dominated by Communists. Since the trade will also be dominated by Communists, it does not seem to matter very much and if we are trying to trade with Communists it hardly matters through whom we get the trade.
What we fail to do today is to study the actual markets where we are trying to sell our goods. The President of the Board of Trade has said that it is not a bad idea to have individual businessmen going off and trying to get orders, as though Russia were like America. In doing business with the latter, a businessman can get into an aeroplane in London, arrive in Chicago, put up at one of the local hotels, send his card around to a few manufacturers and industrialists, invite them to dinner with him, consult them individually and then bring back the orders.
Such a system cannot be followed in Russia, because whether we like it or not Russia has an entirely different system, where all orders go through Ministers and civil servants. It is no good a businessman going to Leningrad and seeking orders in local factories, because there is no one there who can give him any orders. The only way in which we can deal with Russia commercially is through this central bureaucratic organisation. The Russians like dealing with groups of businessmen through the Government as a whole. We may not like that system, but if we want to get trade we should at least acknowledge that it exists and comply with it. In the past British businessmen have never hesitated to please foreign customers to get trade, and there is no reason why we should not do the same in relation to Russia today.
If the Government do not like having these trade visits arranged through the British Council for the Promotion of International Trade, then surely they ought to set up a body themselves. It would be easy to have a Government-sponsored body, composed partly of Board of Trade officials and partly of representatives of the Federation of British Industries, and so on. Let that be the body which organises these visits to Russia, and let it conduct the negotiations with the Russians. I am sure there would be no particular objection to that, because it would be the kind of thing that would suit the Russian and Chinese mentality.
The Government this afternoon have not relieved our anxieties on this matter. They seem to be adopting a "take it or leave it" attitude towards Russian and Chinese trade. There are all sorts of reasons for not letting those countries have munitions of war, but there is no reason whatever for not trying to get the maximum amount of trade that we can. We are a trading nation, and it does not matter to us with whom we trade provided there is no actual state of war. We ought to treat Russia in the same way as we do America, Canada or any other country with which we wish to trade, and study its methods of getting trade in exactly the same way as we do in the case of these other countries with whom we trade.
5.7 p.m.
The making of a maiden speech must be one of the very few occasions when a Member of this House appreciates to the full the grim truth of that old adage, "It is good to speak, but far better to remain silent." I therefore beg for the indulgence of this House on this occasion, and I hope that the hon. Member for Aston (Mr. Wyatt) will forgive me if I do not follow his arguments too closely.
I rise to intervene in this debate for three major reasons. The first concerns a matter of fundamental principle. The second is that I believe firmly that, strategic considerations apart, if goods do not cross frontiers armies sooner or later will. Thirdly, I am one of those fortunate people who happen to be a first-class interpreter in the Russian language, and I have spent some years up and down the borderline of that great empire.
In any discussion on East-West trade it is clear that the key to such potentialities as may exist lies in Moscow. No trading relations or indeed any other relations between individuals or nations or blocs of nations can survive unless they are based upon and rooted in complete mutual confidence between contracting parties. I shall for a moment, with the permission of the House, draw attention to a matter of principle of long standing and, I might say, an outstanding aspect of Anglo-Russian financial relations which would seem to me to bid fair to undermine any Anglo-Russian trade agreements which may be reached, and which I hope, strategic considerations apart, will be reached in the future.
Hon. Members will recollect that in the early years of this present century, and in particular after Russia suffered her defeat at the hands of Japan in 1906, and from 1906 onwards until the middle of the Great War, the British public—the ordinary men and women in Britain—invested in Russian projects, under the interlocking guarantees of the Russian Government, the vast sum of £150 million sterling; at today's values equivalent, perhaps, to between £600 million and £700 million. Some of those original investors are alive today, and I am proud to number one or two of them amongst my own constituents in my constituency of Arundel and Shoreham in West Sussex.
What did the Russian Government of that day do with these British loans; what did the Russian Government do with these British moneys invested in Russia and guaranteed by the Russian State? In his day, Lenin claimed that his predecessors had squandered these British loans, but that is far from being true. The fact is that successive Russian Governments used those British savings, invested in Russia, to embark upon the construction of what was to become the backbone of the Russian railway system.
That system included, and includes today, railways not only in the Far Eastern provinces but railways in the Caucasus, railways in the Ural areas, railways in metropolitan Russia and that famous railway, the Nicholas railway, linking Leningrad—or St. Petersburg as it was then called—with the present capital of Moscow. Nor was this all. Large amounts of these British investments were used in Russia to finance vast municipal developments in such famous cities as Kiev, the historical centre of Russia, in Baku and, last but not least, in Moscow itself.
The point of my argument is that until 1918, successive Russian Governments paid regular and prompt interest upon these British loans, as indeed they were in honour bound to do, since they had guaranteed these British investments. Yet one of the first actions of the administration of Lenin when he took power was to repudiate all responsibility for these Russian bonded debts to the British people, for that is what they are. Those bonds are still quoted on the London market; I saw a little bunch of them quoted only last week in the "Financial Times." In spite of that fact, no interest whatever, not a penny, not a rouble, not a kopek, has been paid on them since that unilateral repudiation by Russia of this debt in 1918, a repudiation which, so far as I can make out, is unique in history.
Against that kind of background—this cancer buried in the history of Anglo-Russian financial relations—I fail to see how Britain can ever reach that complete mutual confidence and understanding which is surely the essential prerequisite to any large-scale development of East-West, or Anglo-Russian, trade in the future. It is my most earnest hope, therefore, that my right hon. Friends the President of the Board of Trade and the Foreign Secretary may consider meeting their Russian opposite numbers for the purpose of discussing and ventilating this problem.
For instance, would it not be possible to secure from the Russians a cancellation of their unilateral action in 1918, of this repudiation by Russia of her honourable debt to the British people? Alternatively, could not my right hon. Friends at least secure a settlement of these outstanding problems which would be mutually agreeable to both the original contracting parties?
I apologise for having detained the House so long, and I thank hon. Members for their courtesy and their patience.
5.17 p.m.
This is the first time that the honour has fallen to me of congratulating an hon. Member on making his maiden speech. In doing so on behalf of all hon. Members of the House I shall not say that the speech of the hon. and gallant Member for Arundel and Shoreham (Captain Kerby) was completely non-contentious; indeed, on occasions the hon. and gallant Gentleman reminded me of the provincial mayor who said that in his mayoral year he would steer a straight course between partiality and impartiality.
Be that as it may, the hon. and gallant Gentleman made his speech with confidence, and it was a forthright speech. I do not think that a maiden speech is any less good because of that, since it shows that when we hear from the hon. and gallant Gentleman later he will not be a mealy-mouthed contributor to our debates but will be a good upholder of his own point of view. Therefore, we shall look forward to the time when the hon. and gallant Gentleman can really stretch himself, and I express sincerely the feelings of this House in congratulating him on getting over his first hurdle, though I should warn him that I was told by the right hon. Gentleman the President of the Board of Trade, who followed me when I had made my maiden speech, that the ordeal does not get easier with every speech made.
I want to refer to the previous debate on the question of the breaking off of East-West trade. Hon. Members may remember that it was held when my right hon. Friend the Member for Huyton (Mr. H. Wilson) was President of the Board of Trade, and that matters were brought to a head when Craven Bros, proposed to export certain large-sized boring machines to Russia. Today those machines are in the Barnbow Royal Ordnance Factory at Leeds, and I saw them recently. My hon. and learned Friend the Member for West Ham, South (Mr. Elwyn Jones) and myself expressed the only dissentient note against the policy of our own party on that day—
The rest of us could not get in.
May I say to my hon. Friend that it is a rare occasion for him not to do so.
I now want to return to some of the feelings that crossed my mind then in opposing any breaking of trade with Russia. Anyone conscious of the history of the engineering industry will know that, although East-West trade may have been a tenuous link, it was our most valuable link in the dark days of the depression in the engineering industry. It prevented heavy unemployment from becoming even heavier.
I should like to quote the present Colonial Secretary who, on 18th September, 1950, said:
Representing, as I do, an engineering and textile constituency, and having certain obligations to the workers in the engineering trade unions, I know that this matter of East-West trade has caused them a good deal of thought, which is not surprising because whenever there is a depression or a recession in trade in America, with the consequent fear of unemployment, old memories are awakened.
I do not want to deal too much with old memories this afternoon, but the engineering industry does not look to America as an importer of machine tools. America itself is the home of the machine tool industry, and I should say that only in conditions of war, stockpiling and re-armament would America consider importing British machine tools. When the papers and the pundits in the "Financial Times "talk about a recession in trade, engineering workers begin to look to the East instead of the West.
The city of Leeds was not one of those places worst hit by unemployment in the '30s, but nevertheless one in four of every one of the registered members of my own union in Leeds were signing the vacant book at one time. Because of the variety of industries in Leeds there was little unemployment compared with the scourge that swept over places like Clydeside, Glasgow, and the North-East Coast. Of course, Leeds was insulated against that form of unemployment.
I wonder whether civil servants always know what they are talking about when they draw up lists of engineering products concerned with security arrangements. I have sometimes had the privilege of going to a Government Department, and I remember that I have sometimes thought how silly people there have sounded when talking to an engineer on engineering subjects. We ought to consider this question of what is a war potential. The fundamental machine of engineering is the centre lathe. It makes a wide range of articles, no matter whether whether it is a small centre lathe or a large one. The point is that it makes the things of peace as well as the things of war.
A sewing machine is just as much a machine for war purposes, as it is used for making soldiers' uniforms, as the centre lathe. When we speak of some articles which engineers make being of value to the enemy, I have no doubt that the timber that comes from Russia is of great importance to us in an armaments sense. If we really need trade, we cannot hedge it around with all sorts of moral considerations and those tight demarcation lines which used to characterise the plumbing and domestic heating engineering unions, when someone would refuse to work on anything bigger than a 2-inch pipe or something of the sort. We have got to get down to brass tacks when we are drawing up a list of articles for export to Russia.
Some people have referred to the value of Russian trade in the past. "Machinery," which is a technical journal, said, on 17th December, 1931:
The hon. Gentleman has misquoted me. I said that in commercial transactions she always paid her debts. That does not include any debts which were incurred beforehand.
I was not trying to misquote the hon. Gentleman. I was about to make that point and say that the commercial contracts which she herself had negotiated freely had been honoured to the full. Indeed, I think the hon. Gentleman used some picturesque phrase about "the blood of her farmers."
Even in those days, when there was great bitterness against Russia, Sir Alfred Herbert, who was President of the Machine Tool Trades Association, denounced the past measures which had curtailed our trade with the Soviet Union. In the "Manchester Guardian" of 28th October, 1932, he wrote:
It is my job to receive all sorts of letters on this matter from district committees of my union. I have recently made representations to the Minister of State, Board of Trade, about McLaren Ltd. of Leeds, who are part of the Brush group, and the hon. Gentleman replied to me—I do not think he will mind me quoting from the letter—that no further
I have had a letter from the A.E.U. office in Halifax which says:
Of course, the President of the Board of Trade was right to say that we should keep this debate as objective as possible and discuss the technical and material considerations rather than indulge in political antipathy. When one remembers what the President of the Board of Trade used to do when he was in opposition, one agrees that if he was capable of doing that we ought to be capable of following him. When he was at the Despatch Box I almost thought that Prince Rupert had become commercial traveller.
One of the most serious matters in the British engineering industry is the subject of a long report which I have received from some shop stewards in Scotland. It is from the Hyde Park, Queen's Park and Atlas Shop Stewards' Committee and it is headed, "Orders for Locomotives." The memorandum is set out in great detail, cogently and moderately. I pay tribute to the people who devoted a good deal of time and trouble in order to make the necessary research. I cannot read it all. They detail every one of the traditional markets for locomotives and then express their opinion why we should return to East-West trade.
They refer to the self-evident facts that in Egypt and the Sudan political changes and their impact make the market in Egypt very doubtful. I should have thought that that was an indication of the completely obvious. I will turn to some of the more friendly countries, the sort of places where we almost take it for granted that we shall be well received. About Australia and New Zealand they say:
In reference to South Africa, the document says:
If I have read at length it is because I have been reading from the language of working men who are concerned about their employment. After all, this is a document prepared by people on the job. It also says:
Anyone who has ever known a long period of unemployment never really feels secure again. I remember the late Mr. Arthur Henderson saying that when I listened to him in my teens. It was only in the course of time, in the early months of married life, when one experienced a continuous spell of unemployment that one realised the truth of that statement. There are places in this country where it is not difficult to evoke all sorts of old memories of the hard and bitter days. Although I do not want to put any political responsibility on anybody here, it is a fact that General Elections in the calm and settled atmosphere of full employment are one thing; but General Elections with unemployment in the offing are quite a different matter altogether.
I am not pleading for electoral considerations to enter into this debate, but I ask hon. Members to remember in all our discussions that there are men and women with homes and jobs, and families to bring up. Therefore, I ask for a sensible reappraisal of the economic list, a list which does not sound intelligent to people who have been brought up in the engineering industry. In a period, when we hope that the cold war will become colder, we should, consonant with the security of our country, leave nothing to chance. We should do our best to preserve full employment in this way, as in all others.
5.40 p.m.
I should like to underline a great deal of what has been said by the hon. Member for Leeds, West (Mr. Pannell) particularly in connection with the engineering and machine tool industries. What he has been saying amply confirms my experience in my constituency, which contains a number of heavy machine tool firms, one of which is directed by Sir Greville Maginness, who is at present in Moscow negotiating on behalf of his and associated firms.
During the winter I received a number of deputations of engineers from various machine tool works asking about the prospects of increasing trade with the U.S.S.R. Their sentiments were similar to those so eloquently put by the hon. Member for Leeds, West. I was much impressed by what the hon. Member said and by the way in which he emphasised it to the House.
I suggest that it is necessary to distinguish, in this connection, between the short-term and the long-term situations. As to the former, it does seem as though the Government over the last two years have all along been taken somewhat by surprise by the turn of events. I think the change really dates back to the International Economic Conference, which was organised in Moscow in the spring of 1952.
In this country that conference was dismissed as being just another propaganda effort on the part of the Soviet Union. Those who considered going were strongly advised not to take part in a conference which could only lead to their being the dupes of a Communist propaganda scheme. When we look back on events now we can fairly say that that conference marked the beginning of a change in the attitude of the U.S.S.R. towards trade with the West.
Arising out of that conference, and as a logical development of it, was the formation of the British Council for the Promotion of International Trade, which got under way in the autumn of 1952. That organisation has come in for a great deal of criticism since, but it was understandable that it should consist of individuals with Left-wing interests since it was the child of the Economic Conference of the spring. It went to work in a quiet way and, by the summer of the following year, it had succeeded in organising the business mission to Peking which, as several hon. Members have already pointed out, was a considerable success in the volume of orders obtained. The trouble was that so many of the orders could not be licensed and, therefore, could not be proceeded with.
This point was raised by the President of the Board of Trade and by the former President. I think it should be made clear that all the individual business firms which went to Peking received their invitations direct from the China National Import and Export Corporation. It may have been a coincidence that when they arrived in Peking they found members of the British Council for the Promotion of International Trade firmly entrenched and they gave some assistance to the Chinese during the trade discussions. But the firms had individual invitations from the Chinese and not from that Council.
I am grateful to my hon. Friend for that amplification. The point is that this mission to China met with much greater success than either the Board of Trade or the Foreign Office expected.
Encouraged by that success, the B.C.P.I.T.—whether we approve of the organisation or not—went ahead to organise a similar mission to Moscow, timed for November last. Only at the last minute did the Foreign Office decide that the B.C.P.I.T. must be regarded as a proscribed organisation and that no business firm should go to Moscow under its auspices.
I think there were very good reasons for saying that firms should not go under the auspices of the B.C.P.I.T., but the reason given by the Foreign Office was not one. The official reason was that it was a Communist front organisation, but the real season was that all trade would be channelled through the B.C.P.I.T. That would set up a monopoly so that no firm could hope to trade with the U.S.S.R. unless it did so through the B.C.P.I.T. If that reason had been given everyone would have understood it and would have been able to co-operate more readily. It was irrelevant to go into a somewhat barren argument as to whether the members of the Council were Communists, or fellow travellers, or merely extreme Left-wingers.
The real trouble was that there was a danger of strong monopoly growing up and seeking to channel through itself all future trade with the U.S.S.R. Obviously, that could not be tolerated and it had to be broken. The Foreign Office rightly broke it, but I think that most people will agree now that it was done in a rather clumsy and ham-fisted way.
Despite the delay caused by breaking up the influence of the B.C.P.I.T., a number of firms have since been able to go to Moscow and have come back with very substantial orders. I think that the Board of Trade have been surprised—not only surprised, but taken by surprise—and have not been able to handle the licensing work which those orders have produced.
This is the difficulty of the short-term position, that a firm comes back from Moscow now with a large order for goods, not on the strategic ban list, but subject only to quantitative restrictions. It comes back with an order of such a size that it would absorb perhaps the whole of this country's quota under the quantitative restrictions for the next three or four years.
Having returned with that order, the firm has to decide very quickly whether it can fulfil it or not. These are not orders for Swiss rolls, or simple items like that. They are orders which involve a great deal of works planning and forward ordering and for the most part they must be fulfilled completely and not on a partial basis. It is essential for the Board of Trade to wake up and to give quick answers to the business firms concerned.
Recently, the Chancellor of the Exchequer said that the only weak part of our economy was on the export side. We should do all we can to strengthen it by giving licences to firms, which either have traditional links with the U.S.S.R., or are hoping to expand into new spheres of trade now that others are denied to them, so that they can get on with the job.
If the licences cannot be granted, they should be told so. The matter should not be left in the air. It is better to let them know now so that they can go into other export markets and search until they find one in which they can trade.
The delays aggravating the firms concerned are made worse by the effect of numerous stories and well-authenticated examples of firms in other countries being able to get through the blockade. Those stories are far too numerous and well authenticated to be disregarded as mere hearsay. I do not suggest that we should go back on our honourable agreement. I suggest that our Government should take much more vigorous steps to encourage other countries, who may be slipping, to be as honourable as we are in this matter, or, if they cannot achieve that end, to agree to adopt the lower standard of those other countries.
Certainly, it is very hard to follow exactly some of the ramifications of the system of quantitative restriction which is now imposed. One or two hon. Members have already pointed out examples of the absurdity of the present system, and I again ask the Board of Trade to be quick, to make up their minds quickly and decisively, about what can be done to make the system of quantitative restriction practicable, and operable by the export managers of the firms concerned.
Now I will turn briefly to some of the long-term aspects of this matter. The President of the Board of Trade made a most welcome announcement, which indicates that we may see a considerable modification of the quantitative restriction list, and a smaller but absolutely firm strategically-banned list. That will be excellent, if it can be brought about, but we have to examine where this weak economic blockade will lead us.
Is it to go on for 10 or 15 years? If so, are the prescribed items to be denied for ever to the U.S.S.R.? That may be sound policy, but at least the firms which have made these goods in the past and sold them to the U.S.S.R. are entitled to be told the facts as soon as possible. The workers who are concerned deserve to be told as well, because they feel deeply about this matter.
It is probably right that there should be an absolute control, and an absolute ban upon certain essential strategic exports. A strong case can be made out for it. Let it be a list which can be effectively enforced by all the free countries. Let there be no leaks in such a list. Let it be small enough to be enforceable on a practical basis. I strongly suggest that the best thing to do is to allow everything else to go through without let or hindrance.
I would reinforce what an earlier speaker has said, that trade can be one of our best ambassadors. I am told by several of the technical men who went to Moscow during the winter that one thing which astonished both them and their counterparts in Moscow, their technical opposite numbers, was that, where there was a common interest, namely, a technical problem under discussion, both sides learned that they had something in common, and political dialectic then receded into the background. Let us continue to expand that process. Let there be a greater interchange of practical, commercial and engineering ideas, and some of the political differences which seem so insuperable at the present time may diminish in importance.
There is one thing which the U.S.S.R. could do to help very greatly in this matter. If goods going to Russia are to be used for peaceful purposes it would be a great help if we in the West could be allowed to see more readily the peaceful uses to which they are being put. I have not been afraid to tell our own Government what they should do, and I hope I may be allowed to say as strongly that if Russia's intentions are genuine and peaceable she should give us in the West, informally as well as through organised bodies, the opportunity to go deep into her great country and to see what is going on and the uses to which these goods are being put.
On this point I should like to mention that year after year I have asked for permission to go to Russia, and that only this morning I received a letter saying that they cannot allow tourists in.
I am grateful to the hon. Gentleman for giving me a really up-to-date example. It is a great pity. If we believe the peace of the world can be assisted by a greater degree of trade it becomes very difficult for persons who put forward that ideal to speak in favour of East-West trade if peaceable entry into the U.S.S.R. continues to be denied to so many individuals of good will.
My third and last point concerns the Far East. It is not unusual to say that East-West trade refers only to trade between the Western Democracies and the U.S.S.R., but we must regard the subject of East-West trade as covering trade between the Western countries and the Far East as well. I cannot see that it makes sense to have one list of proscribed goods for the U.S.S.R. and another and altogether different list for Red China.
If there is to be a strategic list, let it be the same list for both countries, and let it be operated in the same way. It is difficult for firms who wish to extend this type of trade to have to apply themselves to two types of regulation and restriction. It is, of course, difficult for the Communist countries to understand the difference, too.
From the purely practical point of view, I should have thought it advisable to have one single united list. Otherwise, an attractive entrepôt trade becomes possible for some of the satellite countries. They may be able to import goods from this country and then re-export them to the Far East. If our blockade is to be effective it must be a unified and single blockade. Let it be no bigger than it need be, so that trade in peaceable goods may flourish and extend.
In conclusion, I ask the Government to be alert to all the aspects of this matter, and not to lag behind our business friends who have done so much to open up this new field of trade in the last few years.
5.58 p.m.
Let me hasten immediately to endorse one of the pleas made by my hon. Friend the Member for Leeds, West (Mr. Pannell), when he asked that trade in boring machines to Soviet Russia should be liberated. If under that liberating trade dispensation, the President of the Board of Trade will himself be one of the first boring machines to be exported, it will be of general interest.
Today, during his speech, the right hon. Gentleman made no real contribution to the problem we have in front of us. His only virtue was a virtue by default, in that he did not fall into the trap of taking up one of the two very extreme positions which are being taken, not today in this House but outside it in the world, on this issue of East-West trade.
One of the most healthy aspects of the debate today so far is that we have avoided those extremes. One of the extremes is the viewpoint of the ideological patriot that any trade with any Communist country at all is a betrayal of the principles behind our side of the cold war and of any soldiers who are fighting in a hotter version of the cold war. In the United States in particular this type of extreme attitude is taken. Some time ago, one of the senators, the junior senator for Wisconsin, embarked upon an attack on the trade which was taking place between Britain and China. That trade was well within the terms of the United Nations Resolution on Trade with China, and some of us on both sides of this House of Commons, and elsewhere, took the opportunity of pointing out that this was a most unfair attack.
Fortunately, many of the pettifogging restrictions and indignities to which our trade and shipping were subjected have now been removed, but it is still true that there is a great deal of misconception within a certain hard core of the United States about this problem. Only the other day I asked a supplementary question in which I referred to the unfortunate manner in which British shipping was being treated. I received a postcard from New York, which is humorous and amusing enough to warrant some mention. It should not be taken seriously at all, but it is indicative of the attitude of extremism about which I have been speaking. It is postmarked New York and is addressed:
I prefer to take the attitude of Mr. Stassen. I should quote it now to lay against the other quotation. On 28th September, 1953, in his report to Congress, Mr. Stassen said:
But since Mr. Stassen made that statement in 1953, the general trading position of Britain in the world has materially worsened and has given greater emphasis, as pointed out by my hon. Friend the Member for Leeds, West, to the need to find alternative markets and sources of supply. We in Britain were hoping that there would flow from the Randall Commission's report a future economic policy in the United States which would afford some amelioration of the position and some relaxation of the difficulties that we were finding in exporting to the United States. We have been disappointed. The Randall Commission report, which I assume is to be followed by the United States Administration, offers very little hope of a new major dollar drive.
There are some people in this country, however, who say we should not worry very much. They say that, after all, the United States has been suffering some degree of recession in the past few months, that United States production is down by some 10 per cent, but that we still have not felt any repercussions on our own economy. They go on to argue that the position is not perhaps very serious. That is the general, and supremely complacent, attitude now taken by the Chancellor of the Exchequer.
We agree that the immediate effects have not been felt. There are two reasons for this. The first is that when the American recession started there was a large number of dollars in the pipeline. The second reason was the recession was this time coincidental with the seasonal purchase of raw materials by the United States from the sterling area. But when this is finished and the pipeline is beginning to dry up we can safely forecast some degree of balance of payments difficulties emerging again, possibly in the late spring. I hope that this will not happen, but I am fairly confident that it will, and it re-emphasises the need for expansion of trade, with alternative markets both by way of exports and finding sources of supply.
That is one extreme, the extreme of no trade at all. The other extreme, which we also find outside this House, is based entirely on economic wishful thinking, the assumption that a major extension of East-West trade will solve all our economic difficulties, liberate us entirely from the problem of meeting our dollar balance and will establish a new global pattern of trade in which we would not depend on dollar sources at all. That is dangerous wishful thinking.
Statistics have been quoted today relating to the extent of pre-war trade with the Soviet bloc, including countries which were not in the Soviet bloc before the war. The President of the Board of Trade says that this trade was about 4 per cent, of our total trade. My hon. Friend the Member for Aston (Mr. Wyatt) says that it was 3 per cent. If my own calculations are of any value, and I doubt if they are, I reckon the figure at 6·27 per cent. I hope that the use of the decimal point will add some verisimilitude to the figures that I am quoting.
Whatever the trade was, the point is that it was not a tremendous part of our total trade. The serious thing now is that it has declined to about one half of 1 per cent. of our total trade. I am not denying that although it was small it was very important indeed, particularly in machine tools and especially in heavy enginering equipment, generating equipment and railway locomotive equipment—all fields in which we are beginning to find the greatest difficulty in maintaining our present level of exports.
Where do we go from here? What are the possibilities of expansion, perhaps to the pre-war figure and perhaps beyond? Two factors have militated heavily against the expansion of trade, and it would be idle to pretend that they all derived from one side of this global trade structure. One of the factors has been the emergence since the war of a new economic policy in the Soviet bloc. Reference has been made to that this afternoon. Before the war, for example, Czechoslovakian trade with the East, amounted to some 11 per cent, of their total trade. Since the war it has been 71 per cent, of their total trade. There is a complete re-orientation of the direction of Czechoslovakian trade as an expression of the policy of the Soviet Union and its satellites. The figures for Hungary are very similar. Her trade with the East before the war was about 13 per cent, of her total trade. Since the war it has risen to 73 per cent.
One must not forget the large numbers of satellite Ministers of trade who have been accused of treason and have paid the penalty, their sole treason being their insistence that their country should trade to a greater degree with the West rather than the East. Let us remember that, but let us also look at what I think is a material change in Soviet policy. First of all, there is the policy of increasing consumption within the Soviet bloc and within the satellite countries. If that consumption is to be achieved, it will inevitably demand an extension of trade.
Secondly, there was the visit of the businessmen to Moscow. Thirdly, and this is again significant, there has been the willingness of the Soviet Government recently to allow the export of a fairly large amount of strategic raw materials to the West. These are pointers that satisfactorily prove that there has been a further change in Soviet economic policy. No longer are they solely and rigidly insisting upon economic integration of their own country and its satellites, but they are prepared to liberate a little trade on their own part. I think that what is required here is more reciprocation on our part.
Therefore, how much are we likely to increase trade? I agree to some extent with the President of the Board of Trade that it is almost impossible to put it into figures. But we need not be too worried about the smallness of the pre-war figures in looking to the future. In pre-war days, there was not, as far as we were concerned, the same demand and need for certain raw materials, such as timber and grain, that we now need from the Soviet Union.
There was not the same need on our part to import from the Soviet Union, and, at the same time, there was not the same dramatic need on our part to find new markets for our goods. Therefore, the pre-war figures, although interesting, are perhaps not entirely relevant. What we need now is more initiative and enterprise, not only by businessmen but by the Government, in order to expand substantially above the pre-war figures.
The question then remains in what directions is this trade likely to be carried out? I have referred to our own need for grain, but, judging from the look of today's newspapers, it seems to me to be very doubtful whether we shall get very much grain from the Soviet Union for some time to come. The General Secretary of the Soviet Communist Party has announced what looks like a major purge amongst agriculturists for having considerably reduced grain acreage during the past few years.
I do not think we need worry too much about that, because my right hon. Friend the former President of the Board of Trade referred to a new factor in trade relations which developed in the last few months of last year, when the Soviet Union was prepared substantially to meet their trading deficit by shipments of gold to Britain. Of course, that makes a great contribution to our own gold and dollar reserves, and, in fact, the recent increase in our gold and dollar reserves was due mainly to the receipt of gold from the Soviet Union.
Does the hon. Gentleman think it may be possible to assume that convertibility against the dollar can be achieved with Soviet gold?
It is an interesting proposition, but I do not think it will be possible for a minute.
It is not as easy as all that.
Perhaps my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman) will have an opportunity later on to make his speech and will discontinue his practice of making a speech by means of interventions when he feels inclined.
The second inhibition on trade is the strategic materials embargo. There is a case, in a hot war, for a very strict and restricted embargo on the export of strategic and warlike goods, but I want to introduce what is perhaps a new point. I want to take a look at two new major strategic policies which have emerged in the last few months.
One is the new strategic policy of the United States of America. I disagree fundamentally with this policy, but, after all, it is stated to be their policy. Apparently, in future, the United States are to rely upon atomic and hydrogen bomb retaliation in order to preserve the peace of the world. I think that is a stupid decision, but this is not the occasion on which to argue the merits and demerits of that policy.
If that is the case, they are of course admitting that they are no longer interested in maintaining the same relative balance of forces in terms of conventional weapons. The very great slash which has been made in the United States programme for conventional weapons points out this fact. If the threat of atomic missiles is to be the future way of maintaining the peace of the world, the relative strength of conventional arms in different countries of the world no longer has the same significance. If that is the case, what point are strategic embargoes on goods which, at the third, fourth or fifth remove, may be used for making conventional armaments? If these conventional weapens are to be of less significance, surely a strategic embargo upon machine tools, rubber and other goods, which might have gone into the manufacture of conventional armaments, is also of much less importance. For that, and for other reasons, the embargo list might now be radically overhauled.
The second major fact in world strategy is that the policy of the Soviet Union is designed to meet the increased demands of domestic consumption. I think it looks likely that the Soviet Union is now turning away from the policy of conducting hot war by proxy, and thereby running the risk of dangerous military adventures, towards a policy of building a higher standard of living for her own people, obviously to reduce internal tension, while maintaining the cold war pressure by ideological warfare on the periphery. If that be true, and I think there is every evidence for it, then the answer to that ideological warfare is not less trade, but more trade; in other words, if there is anything in both these new strategic conceptions, they both point to the need for the expansion of East-West trade.
Finally, what is to be done, and what can this Government do? Firstly, they should begin to take note of the possible emergence of a United States depression, which, so far, they have completely refused to calculate as being vaguely possible. They must admit that, in their on electoral interests, if for no other reason.
Why?
The Conservative Central Office will be interested to know when the depression is likely to come, so that they may advise the party opposite to go to the country and so avoid its full effects.
In their own interests, I would advise the party opposite to begin to take a little interest in what is happening in the United States. Having accepted that and having resumed the development of East-West trade, I feel that the embargo list must be completely overhauled and very greatly restricted.
The Government must begin to take the initiative in buying strategic materials from Russia. I put a Question the other day to the President of the Board of Trade asking the right hon. Gentleman if the Government were prepared to take the initiative in trade with the Soviet Union. His answer exposed the complete blankness of the Governments attitude. "Leave it to the business men," he said. "If they want trade, they can get it." If all Anglo-Russian trade were a matter of individual bargaining between business men, then there might be something to be said for the present policy. But when the country concerned is an economic monolith, as is the U.S.S.R., surely the answer is to begin by Governmental negotiations at the top level, and I support the case of my right hon. Friend the former President of the Board of Trade, who asked that there should be new negotiations for a new Anglo-Soviet trade pact.
May I also take up a point made by the right hon. Gentleman opposite when he said that his mind was not entirely closed upon this issue? It is difficult to peer into a tiny crack, but if we can do so, may we reinforce the plea, which has already been made, that this is an instance upon which there should be Governmental negotiations at the highest level?
Finally, in regard to trade with China, on which the right hon. Gentleman said his mind was completely closed, may I say that is really not good enough? It is no good having one embargo list for the Soviet Union and another and more comprehensive one for China. There is a railway between the Soviet Union and China. We can assume that these two countries are on speaking terms with each other and will enter into mutually satisfactory negotiations. If we try to operate a double embargo and a double list of goods, we shall only be opening wider the crack which may lead to the collapse of the whole structure.
I wish to see the stop list gradually eroded. While there is a danger of a world war, I do not want tanks to be supplied to Russia, or China, or indeed to any other country. But I believe there is a need to look at this problem as a whole. If that can be done, if the Minister of State can tell us the answer to some of these points, I think that it will have a good effect, and which will contribute to an increase of trade, and from that to an increase in stability and in the prospects of peace.
6.21 p.m.
I was interested to hear in the concluding remarks of the hon. Member for Islington, North (Mr. Fienburgh) a reference to the importance of increasing trade with China and I entirely agree.
This afternoon we have had an agreeable and constructive speech from a new Member, the hon. and gallant Member for Arundel and Shoreham (Captain Kerby), in which he referred to the substantial loss of British capital which has taken place in Russia. While I appreciate the sincerity with which he spoke, I thought it was rather late to revert to those matters which come from the dim and distant past. Those—and I am one—who wish to see trade between East and West progress and increase must accept the present position as they find it.
The post-war pattern of trade will differ quite substantially from the pre-war pattern as a result of the industrial development which is taking place both in Russia and in China. My own special concern is trade with China, and I must confess to some disappointment that since the statement of the Chinese Government, in 1949, of their desire to trade with the West, they have placed so many obstacles in the way.
Other hon. Members have more personal knowledge of this matter than I have, but when one contrasts the hopes raised in the minds of British traders in 1949, of being able to trade with Communist China, with the obstacles and frustrations which led to the very serious decision which large numbers of trading houses were compelled to take in May, 1951, to withdraw from China, one realises some of the difficulties which are likely to beset those endeavouring to trade between East and West.
When discussing these matters it is wrong to believe that it is all easy sailing on both sides. On the one hand, we can appreciate to the full the advantages which may be gained but, also, we should face the quite recent difficulties not of our making which have bedevilled and interfered with this trade in the past.
I wish to refer to the statement made in the House by the Foreign Secretary in May, 1952, when he referred to the increasing restrictions which were being placed on the entry and exits of foreign staffs of British houses then in China, the arbitrary taxation from which they were suffering—in parenthesis let me say that unpaid taxes are increased at the rate of 1 per cent. per day—and also to the necessity under which they were then, and still are, to retain and to pay redundant workers.
I do not think there has been much improvement in this matter, in fact, I am sure there has not, because on 8th January, 1953, the Joint Under-Secretary of State for Foreign Affairs referred to a further Note which had been sent to the Peking Government, again drawing attention to the difficulties experienced by British citizens when trying to wind up their businesses, and the unreasonable and exhorbitant demands presented by the workers.
The Under-Secretary of State then expressed the desire of Her Majesty's Government to continue to trade with China. Since that Note was presented more than a year has passed and my information is that the restrictions on British citizens now in China—the ordinary representatives of the substantial commercial houses which used to work in that country—have been in no way relaxed.
It is impossible for these employees to secure an exit permit until every tax due by their firm has been paid; and until every obligation of the firms which they represent has been cleared up they are held personally responsible. Equally, it is just as difficult for the firms in this country, who have found volunteers to go in and take their place, to secure entry permits for them. When examining this position it is worth while to realise how easy it is for Chinese citizens wishing to come here to be employed, either by the Bank of China or in other capacities, to secure speedy determination of their applications for entry and employment permits, and the freedom with which they are allowed to leave this country.
I started by saying that I believed that in East-West trade there was a fruitful and useful field of co-operation between the countries of the East and of the West. I am quite sure it is right that we should equally understand the difficulties which arose in the past and which were in no way the making of the Government of the United Kingdom. If East-West trade is desired by the people of China and Russia some responsibility attaches to them to remove and deal with these human problems, which no one in this House would justify or defend; which can only cause ill-will and which prevent the development of this trade which we so much desire to see.
6.27 p.m.
To some of us this has been, so far, a most astonishing debate. I cannot help referring to and emphasising what my right hon. Friend the Member for Huyton (Mr. H. Wilson) said about the change in the climate of opinion. It is, of course, quite inconceivable that this House, even so short a time ago as three months, could possibly have debated this subject in the spirit in which it has been debated so far this afternoon.
There has not been a single dissentient voice on either side of the House so far as the main objective of the debate is concerned. Even the hon. Member for Holland with Boston (Sir H. Butcher)— who was mainly occupied with the problems and the very real difficulties arising out of the changeover in China and all that that involves both in China and outside—coupled his remarks with his belief in the desirability of extending trade—mutual trade, as the Chinese are so fond of saying—on equal terms of mutual benefit with both the countries of Eastern Europe and, I gathered from his speech, with China, too.
As is the case with everyone who has spoken the hon. Member differed from the President of the Board of Trade, who repeatedly maintained the determination of the Government to draw a hard and fast distinction between trade with the Soviet Union and Eastern Europe and trade with China. The right hon. Gentleman made it clear, as, indeed, did the Prime Minister, in a speech a week or two ago, that while the Government were prepared now for extensive modifications of the strategic list in the case of Eastern Europe and the Soviet Union, they were not prepared to modify it at all—or so one gathered—now or in the foreseeable future in the case of China.
I say this to the hon. Member for Holland with Boston: while that attitude is maintained we cannot expect very much co-operation or helpfulness from the Chinese authorities in the much smaller matters with which he was concerned. When I was in China last autumn we discussed these matters, among a number of others, with the Chinese Government, the Chinese Minister of Trade and our own chargé d'affaires in Peking, and we all were convinced that, given greater understanding and cooperation in trading and other mutual relations generally, there is not much in the smaller matter which is not capable of being dealt with rapidly to everybody's satisfaction.
The hon. Member repeatedly uses the word "smaller." It is over £200 million.
I did not gather that the hon. Member for Holland with Boston was talking about that. The issue to which the hon. Member for Bury and Radcliffe (Sir W. Fletcher) referred is a bigger issue and would obviously have to form part of any negotiation between the two countries about any wide expansion of trade, but I gather that the hon. Member for Holland with Boston was talking about a different matter, which I understand very well.
I was referring specifically to the desire and the right of about 200 or 300 British citizens to leave of their own free will, and not to be detained in a country because they cannot secure an exit permit.
I understood what the hon. Member was referring to very well. Before I went to China we took the opportunity of consulting our Foreign Office and asking what matters we could usefully inquire into. They said that this was one of the things into which we could inquire on the spot, and, without going into great detail, I think all who attended those interviews would agree with what I have said. I do not think there is any fundamental difference about this. The difficulties to which the hon. Member referred are capable of quite rapid adjustment in a general improvement of relations.
On what basis do the Government draw this distinction between what they are prepared to do in the case of the Soviet Union and what they are prepared to do in the case of China? If they were saying that we are in no sense at war with the Soviet Union and that at the moment, until the Korea business is finally disposed of, we may in some fashion be supposed to be at war with China and, therefore, any improvement in that matter would have to be postponed a little while, until the outstanding quasi-military questions are brought to an end, that one could understand. But I could see nothing either in the Prime Minister's speech the other day or the President of the Board of Trade's speech this afternoon which afforded any hope that the Government were thinking along those lines.
If they were, I hope that the Minister of State, Board of Trade, who, I think, is to reply to the debate, will deal with it, but for the moment it looks as though the Government are drawing some fundamental distinction of principle between the basis on which they are now prepared to trade with the Soviet Union and the basis on which they are prepared to trade with China—applying a very narrow, limited and specific list of prohibited strategic materials in the one case and in the other leaving the wide, indefinite, general and apparently unlimited list which has impeded trade with Eastern Europe in the last few years.
Several hon. Members have referred to the impossibility, as a matter of practice, of applying any such different standard of values or different strategic list. Obviously, if we have a narrow list in the one case and a wide list in the other, and there is a close understanding between the two countries concerned and a common frontier between them, it is difficult to enforce such a narrow distinction. Apart from that, however, there are questions of principle Which one would like the Government to deal with if they are saying that the two matters have to be dealt with quite separately.
In the first place, there seems to me to be nothing which they can say in defence of their proposed attitude to Chinese trade which they have not always said, until the last few weeks, about trade with the Soviet Union. The right hon. Gentleman spoke, as did others, about the Communist desire for autarchy or self-sufficiency. To a great extent, that has been forced upon them. Whether they would have travelled that road independently of their own initiative, is a matter on which we can all speculate, and it is a fascinating speculation indeed, but in fact they could do no other.
It was the West—Western Europe—who imposed the virtual blockade, a cordon sanitaire, around the Soviet Union in the early days of the Russian Revolution after the military intervention had failed. If we compel a country to pull itself up by its own bootlaces for 30 or 40 years it is a little ungracious and a little useless to complain of its autarchy at the end of that period, more especially when the autarchy has been demonstrably seceded.
Surely the real lesson to derive, looking at the results, is the lesson which Ernest Bevin derived when he said in the House, in almost the last speech which he made, defending his policy of recognising the Chinese Government. "Let us not make the mistake towards China in the 1950s that we made towards Russia in the 1920s." The blockade failed then; it will fail now, and its only result is to build up an unnecessary artificial division, suspicion, fear, hate and almost all the other things which prevent a world which is physically one world from acting as though, in fact, it were one world.
As for the change in the climate in respect of the Soviet Union, there is one incidental point I want to make about the speech of the hon. Member for Altrincham and Sale (Mr. Erroll). I agreed very much with almost all he said—so much so that I hardly like to differ from him about anything. That is one of the remarkable features of the debate. He said he thought the real reason which influenced the Foreign Office in discouraging people from going to Moscow under the aegis, as it were, of the British Council for the Promotion of International Trade, was that if we encouraged people to do so, or allowed them to do so, we might create a virtual monopoly, which would be a very undesirable thing. I agree with him absolutely that it would be a very undesirable thing.
I think I can assure him, without authority from anyone—and certainly not from the Foreign Office—that that was not the Foreign Office reason. The Foreign Office objection to the British Council was not at all that it might create a monopoly in trade with the Soviet Union. The complaint was the exact opposite. It was that the Council had nothing to do with trade at all; that it was a "phoney" organisation, concerned only with Communists or fellow-travelling propaganda. One cannot have it both ways.
The truth is that the Council is neither one nor the other.
But I think the hon. Member will agree that the fact is that the Chinese trade office in East Berlin has said that it will not do business except through the B.C.P.I.T.
I was dealing with the visit of Russian businessmen, but if the hon. Gentleman is asking my opinion as to whether it is desirable or undesirable for all trade to be channelled through a particular medium I would agree absolutely that it is not desirable. If there are to be monopolies at all let them, from our point of view, be communal and not private enterprise monopolies. Although I am not a member of the Council and have no authority to speak for it, I am quite sure it has no intention either of creating any such monopoly or of acting as propagandist agents or instruments for any one.
The hon. Gentleman himself was perfectly right when he said that this movement—and all those movements—arose out of the Economic Conference which met in April, 1952. There was no political propaganda about that. I think four hon. Members from this side and one from that side of the House attended it. I am sure that they will all agree that there was not an atom of political propaganda from first to last.
Indeed, the only contribution containing any ideological controversy came from an American delegate. For 20 minutes he very eloquently—though not convincingly to me—powerfully and plausibly defended any kind of private enterprise trading against any kind of collective economics. His speech was translated verbatim and also printed in five languages in the newspaper which was produced at night, and although "Pravda" did not quote him in full it gave him a fair show. That was the only political propaganda which I heard throughout the conference.
The hon. Member was exactly right in saying that this conference started and was intended to start—and there may be political purpose in this, I daresay—a general loosening up of trade relations. In that it rendered a great service to Europe and to the world. I do not now wish to enter into any kind of recrimination as to who was right or wrong at the time. I agree that the point now is to see how best we can make a real, constructive use of the existing situation.
What is that situation? We have a vast territory stretching from the Baltic coast on the one side and to the far Chinese coast on the other. This vast tract, populated by about 1,000 million of the human race, is living under this new Communist régime. Rather less than half of it is under the Russian variety, and rather more than half under the Chinese variation of it—if it is a variation. There are close ideological ties; there are close economic ties.
Is it better, from the point of view of human safety, that the world should be divided into two halves with as few connections and relations as possible, and as little trade as can be managed, or is it, on the whole, better that we should make the best of the situation—knowing that we cannot change it even if we would—and on that basis try to establish as much co-operation as can be achieved? I feel sure that the second way is right.
It is not possible for one half of the world to blockade the other half—it then only blockades itself. My right hon. Friend the Member for Huyton, and my hon. Friend the Member for Islington, North (Mr. Fienburgh) who spoke in the same sense later, were perfectly right in saying that, however much we expand or extend our trading with Eastern Europe or the Far East, no one believes that we will thereby completely free ourselves from any connection with, or dependence upon, the American market or the dollar system. Not at all.
The present situation is completely unreal and unbalanced. It is almost insane that we should nearly burst blood vessels to achieve a surplus of goods, and, having achieved it, should then endeavour to force the goods into the American market which does not need them, does not want them and will do everything in its power to keep them out, while two-thirds of the world are gasping for just those goods. Some kind of dependence there always was and always will be. But the present sole dependence is entirely unnecessary and arises only out of this misconception of true world trading policy. It is a thing which we could change.
On Wednesday we shall be talking about world mutual aid, which is really another aspect of the same problem. We are to talk about the aid which the "have" Powers may render to the "have not" Powers. We shall deal with the assistance which the industrially developed part of the world may render to the industrially undeveloped part; with the help which those who are rich in raw materials may give to those who, whether rich or not in raw materials have not so far been able to develop them.
In the present climate of world opinion, and particularly the opinion in the so-called backward and undeveloped countries, I am quite certain that those countries will adopt the same slogan as we ourselves did in a comparable situation—"not aid but trade." The so-called backward and under-developed areas, are now nationally conscious and urgent for national self-control and national independence. We shall not be able to persuade them to accept aid from us at the loss of their own feeling of independence.
If we wish to assist them, the quickest and most effective way is by trading with them. We may have to lend them resources. They may have to be provided with the means of development, but the best way to do that is to leave them in charge of their own countries and of their own development, and not try to force our ideas and, still less our ideologies, down their throats. It should be made perfectly clear to them that they are men and brothers with the rest of us, and that what they can produce and exchange for what we can give them will be readily exchanged so far as we are concerned.
It seems to me that this business of trading with all countries without any ideological restrictions and without any kind of political discrimination, with the intention of producing as much world co-operation as possible, is the easiest way out of the world's present uneasy and insecure position along the road to peace, security and the greater happiness and development of mankind.
6.51 p.m.
The hon. Member for Nelson and Colne (Mr. S. Silverman) will, I know, excuse me if I do not follow him straight away in what he said. I am, however, coming back to the question of China a little later.
The right hon. Member for Huyton (Mr. H. Wilson) opened the debate with a speech that was factual and moderate, far more so than some of his recent speeches. He had to add a little bit of scarlet embroidery, but anybody, even in his fluctuating position on the opposite benches, has to do that. He certainly brought forward the problem with moderation. One thing which has surprised me about this debate is this. Nobody has said what the real basis is, and that is that trade, like peace, is indivisible. I do not say that it means that it does not have to be phased slightly differently in time and circumstances in different countries, but, by and large, we cannot cut up trade into little pieces and say that we will do this and not do that.
I remember when the right hon. Gentleman was first going to Moscow a good many years ago and I, as an old Moscow hand, having gone there first in 1933, took the opportunity, because I thought it might be useful, of discussing with him methods of negotiation because it was obviously to the good of this country that his mission should be a success. I thought he showed great moderation today when he pointed out to the President of the Board of Trade that what might have been right in the "Co-com" Committee—I think a great many of those who visited China later called it the "Hocum Committee"—might not be right today.
My right hon. Friend the President of the Board of Trade was in a very difficult position. I am going to disagree with him and, in a kind way, attack some of the things he said, but I am bearing in mind that he is the inheritor and not the instigator of a great many of these problems. The real trouble lies to a great extent in the workings of any international body. Hon. Members opposite must know that it is very easy to enter into an international body but that it is extremely difficult to withdraw from one without causing an enormous storm of protest all the way round.
What is the position? On this committee, which does not meet very frequently and whose constitution is a curious one, lies the decision to a considerable extent of what trade we can do. Take its constitution. Sweden and Switzerland are not members of it. They only say, with their tradition of neutrality, that they cannot be members but that they will abide, as far as their international interests allow them, by its decisions. But a great many of us have some doubt as to how far that really goes. The position of Western Germany is even more doubtful.
We have, therefore, an international committee governing to a great extent the question of strategic lists, quantitative control and speed of decision which is no longer the instrument which can serve our purpose today. I am going to urge that at the meeting which is to take place my right hon. Friend puts forward that point very strongly indeed. The question of quantitative control which has been raised is not unknown to past Presidents of the Board fo Trade on the other side of the House. In the days when steel erection was under consideration, the question of quantitative control in the quarters that were ahead caused more headaches at the Board of Trade than almost anything else.
If a battery of machines is manufactured—such as, for instance, in my constituency where they make paper manufacturing machines—for £1 million, or the steel hull of a ship is manufactured for £400,000 or £500,000, it is not possible to apply the same quantitative control as can be applied to steel pots and pans. Therefore, the quantitative control which has been exercised in this committee will become a very serious stumbling block, and I would urge on the Board of Trade that the first thing they do when they attend this meeting should be to say that we cannot have quantitative control in its present form.
Another of the difficulties is this. The strategic lists of the various members of that committee differ. We have France with one strategic list and America with another, and ours may differ too. As can be imagined, if we start exporting, under what is supposed to be an agreement, things on our list but not on those of other members, we shall get into a terrible state of confusion. As to where we are to draw the strategic line, I think it defeats the mind of man because the shifting of time changes it so greatly.
Let me give the most graphic instance that I can think of. If one of Her Majesty's Ministers were to say, "We have today taken the very latest type of jet fighter off the secret list and have sold the first 300 to Soviet Russia," there might arise a considerable storm. But if we took the component parts and the pieces of metal that went to make those machines we should find that every one of them was not on any secret list at all. Therefore, it is a question of the export of know-how being one of the chief ingredients, and if the wit of man can devise any means of prohibiting the export of that, I would take my hat off to him because I do not think that in the end it can really be done.
We are discussing East-West trade this afternoon. Where does it begin? Nobody has decided that. We were told, I think, by the late Mr. Ernest Bevin, that our strategic frontier was on the Elbe. But I think East-West trade starts in Berlin, for the whole area and not only for Germany. There may be a line drawn between East and West in Germany, but it is one that is driven across goodness knows how many times every 24 hours by the trading interests of both parties. It is quite certain that before long that division will no longer exist.
Therefore, if we are realistic we must realise that if we arrive at decisions by unrealistic lists and drive that trade underground, it will flow, as it is flowing now, through satellite States. But it is not quite as simple as that. It is easy to talk, as the hon. Member for Nelson and Colne did, about 1,000 million people, but it is not a homogeneous mass. There is one small railway, and it is not possible to transport a good many million pounds' worth of goods effectively or economically through the satellite States or Russia into China. From the practical point of view, the major things that China wishes to get from this country—and I have a fair idea of what they are— could not be transported in that way but, in the end, would have to go by ship.
Another aspect of this trade, which has not been mentioned, is that of invisible exports. Nearly everyone has talked in terms of the benefit to the manufacturer, but that is by no means the only one. The financing and insuring of the shipping of any quantity of goods to any country—that is, all the invisible export trades and their ancillaries—must be of benefit, and one of our biggest earners of foreign currency. We are gradually opening up markets, and we hope that when the various steps towards convertibility come to fruition we shall be in a position to continue to earn currency, in invisible exports as well as in goods produced in our factories, from those very countries with whom we are now trading.
The greatest indictment in international trade is delay. We are up against competitors who can give a "Yes" for an answer on the spot. I have dealt with businessmen in Soviet Russia for 30 years, in a fairly large way, and I know their way of business. They must be respected. If they have in front of them two people, one who says, "I have to refer back not only to London but from London to the hokum-Co-com Committee, and then two or three weeks later I may get an answer," and, on the other side of the table, someone from Germany, Sweden or Switzerland, who says, "Please teacher, I will take that order, under those terms, here and now, and sign on the dotted line," there is no doubt who will get the order.
We have seen it happen in the case of trawlers, and we shall see it happen in other cases. The most remarkable feature of the visit of Mr. Scott and his friends to Russia is that nearly all the orders given to them were for capital and not consumer goods. It was, in a way, the cream of the business likely to come out of Russia for some time. There may be more cream—I hope there is—but I sounded a note of warning about it a few days ago. If we are to lose these orders through delay, and through failing to say to the "Co-com" Committee, "We must have a decision on this matter, by a special meeting if necessary," not only do we lose the orders, but the good will that arises from making a contract as a prelude to making the next contract. If there is one thing which the Russians value it is continuity of trade with firms in whom they have been able to gain confidence through good deliveries and proper treatment.
The Government must put forward the urgency of this matter, and must insist on setting up some form of machinery by which we can give a "Yes" for an answer. There must be greater latitude in the set-up of that committee than we have known up till now, if it is to continue in existence. It is far from easy. The Foreign Office, which is the negotiating instrument in many of these matters, has a very difficult task. They are biological freaks. They are always in a very delicate condition at the time. The period of gestation runs into the period of decay; certainly beyond the tenure of office of the present Government or the present Minister. It is difficult for the Foreign Office not to be cautious when negotiating with these countries, because it knows that an error can be very costly and may destroy the slow and precious build-up of good will.
The policy of Her Majesty's Government is clearly indicated, and asks for early action. We must say to this committee, "We are not to be restrained and restricted by the set-up, which needs alteration. If you do not see your way to alter the set-up to suit us a good deal more we must do something which is extremely difficult and unpalatable." If we do not succeed in this endeavour, hon. Members opposite must not criticise us for withdrawing from an international body and saying—to use an American phrase—that we shall "go it alone." It is not that we wish to do this; far from it. Exactly the opposite is our view. But the urgency of the question, with the employment prospects on the one side and the gradual expansion of trade and the good will that exists in the U.S.S.R. on the other, makes it very necessary to put our view forward as strongly, although in as friendly a fashion, as we possibly can.
I hope that the hon. Member will not feel from any words of mine that hon. Members on this side are in any disagreement with him on this matter. I said that we welcomed the fact that we were trying to reach agreement with "Co-com," but on more than one previous occasion I have said that if we cannot reach agreement quickly we must, to use the American phrase, "go it alone." That is the very phrase which the hon. Member used, and there is complete agreement between us on that point.
Yes. The hon. Member for Nelson and Colne raised the question of trade with China. In a debate of this sort—which has been quite out of the ordinary in the objectiveness with which the subject has been approached—we do not want to say anything that may harm negotiations which must take place on the question of trade with China, although they will not necessarily take place at Geneva. Agreement may not come as quickly as some of us would like, but we have to realise the difficulties and problems of other countries.
Nobody has yet mentioned the Indo-Chinese problem, which is very closely wrapped up in this question. We have to talk in different and much more guarded terms on this aspect of the question than when we are discussing trade with the U.S.S.R. and her group of satellites. First, trade with China is not on the same basis from the traders' point of view, because the credit facilities are very much less. China has never established the same high basis for credit as has the U.S.S.R. Therefore, we must look somewhat askance at her past record—especially her immediate past record.
By methods which cannot be defended if they are carefully studied she has squeezed out those who have extended a great deal of thought, skill and capital in providing her with her only modern industrial equipment. She has dispossessed them, after bleeding them white in the process. That is not likely to inspire the confidence of those who will have to trade with her. She has not met claims for compensation for loss of life. Her record, both in Korea, and, to anybody who understands the question, in Indo-China, is one which cannot be forgotten by us and by those with whom we have to work.
A fresh opening up of trade with China, although in theory indivisible with the opening up of trade with Russia, must not be regarded in the same way. Beside the question of being more cautious and having less confidence we must remember that her economic position is nothing like so sound. She is not a big exporter. Somebody is keeping the score in the background, and she is not again going to run into a big inflation. What she can purchase from us now will, in the end, have to be on long-term finance, provided from this country or a group of other countries. If it is to be on a balance of trade basis our prospects for trade with China cannot be exceptionally good, and they are in no way comparable with our prospects for trade with Russia and her satellite states.
I think, therefore, the Government are perfectly right in being very much more cautious about this question, and in having in mind China's history as a goods sump that has always taken in very much more than it has given up. Certainly there must be some sign on China's part of a sense of obligation, some act of good will, to set the wheels of trade in motion. I certainly hope that it will be forthcoming. We have gone a very long way towards helping. After all, we have recognised the Chinese Government, and got into a considerable amount of hot water with some of our powerful friends in so doing.
I remember that when that recognition was announced I said—I think I was the exception on this side of the House—that I welcomed it, but that there must be a two-way traffic. There has not been much two-way traffic about it so far, and the Government are quite right in thinking of the price they can pay for a resumption of Chinese trade. It must to some extent be limited and preceded by some act rather than some word of good will to justify it, not only in our eyes, but in the eyes of those with whom we are co-operating so very closely in many other ways.
Such as what?
Such as paying some of the huge sums due. Payment of compensation would not be a bad thing with which to begin. The Chinese could also allow people out of the country, and allow a proper commerce between the two countries. There is only a one-way traffic.
I do not quite understand. If what the hon. Gentleman wants is a two-way commerce, how does he reconcile that with saying that the development of trade with China must be treated differently from the way trade development elsewhere is treated?
The hon. Gentleman misunderstands. Two-way commerce cannot get going unless it has an impulse as a starter, and that impulse, that starter, has to be applied in the case of trade with China by China, because so far all the acts towards reopening that trade have been made by this side, and it is time there was some manifestation of good will from the other side.
The hon. Gentleman says that the impulse, the starter, for trade has come so far from this country rather than from China. He knows, I am sure, that, apart from his point about the honouring of old debts, the present regime have made great efforts since 1952 to get trade going between the two countries, and, within narrow limits, have, to some extent, succeeded.
No. I entirely disagree with that analysis. The present régime have put most unfair pressure upon people who are responsible for staffs in China. They have incarcerated in China people they have not released. Through the human element they have imposed unfair pressure on large firms, who have been willing, under that presure, to pay up to the extent of millions. Until that unfair pressure, and the confiscation of very valuable properties, have in some way been redressed, the Government are entitled, I think, to regard the matter of Chinese trade differently from other parts of East-West trade.
We are tonight to have the unusual pleasure of having a debate wound up for the Opposition by the right hon. and learned Gentleman the Member for St. Helens (Sir H. Shawcross), the coelacanth of the Labour Party. The coelacanth is a fish that was supposed to be extinct, because it had not appeared for 10 million years. He suddenly arrives, large and important, with a look of amazement and consternation at seeing where he finds himself, and then returns to the cavernous depths of the law again, not to be seen again for many years.
There are more coelacanths on that side of the House.
There is only one coelacanth. I hope that, with the clarity of exposition the right hon. and learned Gentleman possesses, and with the knowledge he has of the Board of Trade, he will make some constructive contribution, as the right hon. Gentleman the Member for Huyton did. The closing words from that side of the House will be of very great importance, and I hope that the right hon. and learned Gentleman will be convinced by the argument that, though in principle we have got to treat trade the same way everywhere, we have to phase it, certainly in the instance of trade with China.
To my right hon. Friend I would say that his difficulties are not of his own creation. He must by now be fully aware that there is great strength of feeling, not only amongst those who chose this subject for debate but on his own side of the House, urging him on to the resolute and speedy action I have tried to outline. Nobody on this side of the House wishes to increase those difficulties which are not of his creation, but a great many of us on this side of the House wish to add power to the argument he put forward by pointing out that we, who represent every aspect of trade and industry in this country—exports, imports, invisible exports, manufacturing, shipping—and who represent other countries in the Commonwealth as well, because we speak for them, too, are hoping that he will take the line I have tried to indicate as being the only one that is possible to bring about a great expansion of trade immediately with the U.S.S.R. and gradually, after certain preliminaries, with China.
7.17 p.m.
The hon. Gentleman the Member for Bury and Radcliffe (Sir W. Fletcher) has raised a number of interesting topics in a very interesting speech, and with the most of what he said I agree, though I did not quite follow all he said about trade with China, which is a special subject, only to be dealt with on a long-term basis, as Russia was in 1921. Then Russia had to be dealt with on the same terms.
The hon. Gentleman coined a very useful phrase in saying that trade and peace are indivisible. He pointed out the difficulties of a strategic embargo with different lists in different countries. He outlined the West German position and the West Germans' present freedom in being able to export behind the Iron Curtain. He also mentioned speed of deliveries in which confidence could be placed, which is very important.
However, it is about China I want to speak. Through trade with China there lies, perhaps, the greatest hope for building up lasting peace. The Soviet Government have been very wise in not relating the speech of the Prime Minister about the possibility of trade between East and West to their usual propaganda.
Such has been the pace of scientific and industrial development since the start of this century that things have become old almost before they were new. We talk now about the chances of industrial and commercial development keeping pace with scientific development. We can talk as long as we like about the strategic considerations of certain products, but the plain fact is that such an invention as the hydrogen bomb, for instance, makes strategic considerations, and the strategic importance of goods, things of the past. They no longer matter. The terrible, destructive power of one instrument rules out all the orthodox methods of warfare.
The realisation of that fact can drive us through trade to peace, if we accept the opportunity. That is why, when we discuss licences and positive restrictions and all those things which are the normal processes of commercial diplomacy, it is best to see how we are placed as an island of 50 million people and what we have to do to earn a living in competition with the rest of the world, at the same time fulfilling what has now become our historic rôle of bringing to the undeveloped and backward countries of the world some substance of life as we know it. We can do these things if we are courageous enough.
China and Russia are two cases in point. Russian development during the past 30 years has proved, after a long struggle, that Russia is effective in her own creed. We believe, through our civilisation, that our creed is better. But the Chinese are now embarked on the same creed as the Russians and it is obvious if one surveys history, from Attila to Genghis Khan, from Julius Caesar down to Hitler and Stalin, that the superior civilisation wins in the long run. We claim that ours is the superior civilisation. Therefore, with all our techniques, let us give a chance to other people to demonstrate their beliefs and let us sit back and watch results. They may not come for 50 years, but they will surely come if we have the courage to face the position.
One hon. Member has already mentioned the position of Norway and Sweden It is patently true, if we look at the world picture, that the great industrial colossus of the United States is now absorbing more than half of the world's available supply of raw materials. That is something for the rest of the world to consider. Since 1939—and, indeed, before that—in this country we have been developing new techniques and new industries, and in some of them we are perhaps further advanced than any other country in the world. It is in those spheres that we should be prepared to make greater advancement on the basis of what we can offer to the world. To mention but two examples, there is our great electronic industry and our prefabricated buildings, where we have a strong lead.
All these points are important on a long-term basis, not only in trading prospects but also in educational prospects. I am one of those who, since the introduction of the Education Act, in 1944, have thought that we pay too much attention to and place too much reliance on grammar school education. The Swiss. the Dutch and the French do not do that. They place greater reliance on technical education and the training of craftsmen.
In our industries we know that there is a great shortage of apprentice craftsmen. That is the case in almost every industry. In Switzerland at present three boys out of every five are trained for the purpose of earning their living overseas on the basis of their technical education. We may have to do something like that, because we must go in for the kind of contracts which the Russians and Chinese will provide which, in the long run, means long-term contracts.
It will perhaps be necessary to reorganise the basis of our commercial representation overseas. In most countries we have commercial attachès belonging to the Foreign Office. The majority of them are given 18 months' training in this country, which means that for all practical purposes they have no knowledge of industry in this country. I am one of those of the opinion that long ago those responsible posts should have been placed under the care of the Board of Trade and that the people in them should have been properly trained for the job they have to do.
We do not want men occupied in trading matters who have only a smattering of civil engineering or the development of water works, power stations, irrigation and sewers; we want men who have a thorough knowledge of each industry which they represent. We do not achieve that by having Foreign Office commercial attachés at our Embassies. It is time the Board of Trade looked into the matter and laid claim to its proper function of manning those posts overseas.
It is quite clear that if we are now entering a phase of relative "tone down" in world tension, we have a chance which has perhaps never been presented to us before of providing a future for this country on the basis of mutual trade and mutual help which will last us, perhaps, for the rest of our civilisation.
7.26 p.m.
I do not propose to go over the economy of the nation, as the hon. Member for Hammersmith, North (Mr. Tomney) has done, but I agree with him on one point: there is a good deal of merit in the view that having the trade representatives of the United Kingdom under the Foreign Office is a mistake. A Select Committee on which I sat made some recommendations on that score some time ago. For my part, I should be a little more enterprising even than those recommendations. I think in time it might be possible to ensure that all the overseas trade representation of the United Kingdom is grouped under the Board of Trade.
This has been a useful debate. The note was set by the right hon. Member for Huyton (Mr. H. Wilson) who, I thought, was most reasonable on this issue. The note he set has made the debate much more useful than it would have been had it been merely a slanging match between the two sides of the House. It is true that since the Prime Minister has laid his massive weight to the cause of East-West trade it has become respectable, and there is no doubt that the time has now come when we in this country must take a different view about it from that which we have taken over the past two or three years.
This does not mean, as the hon. Member for Hammersmith, North suggested, that strategic restrictions are unimporttant. They are still important; we cannot abandon them merely because we have the hydrogen bomb. They still have a value, but in existing circumstances it is a decreasing value. What I want to emphasise is that they can have an even more decreasing value, because if we have more trade then to some extent we eliminate fear and misunderstanding, and if we eliminate fear and misunderstanding we can develop more confidence and therefore more trade.
We have restrictions in trading between the Soviet bloc and Western democracies because we mistrust each other. We believe that a war between these two forces is a possibility. If we can abolish the idea of war, then we can generate confidence, and more confidence can generate more trade. We should do as much as we can to encourage trade between the Eastern and Western Powers because it will generate of its own volition further trade and further confidence.
The reason why I want to intervene for a short time is to express what may seem contrary to this view and to try to put before the House one or two reasons why we should not be too optimistic about East-West trade. It is easy, particularly in the light of our present attitude, to overstate the possibilities of trade in this connection. We must realise that trade between the Western nations and the Soviet bloc including China, was never very important before the war. China and the Soviet Union were never important to us, either as suppliers or as a market.
My hon. Friend the Member for Aberdeenshire, East (Sir R. Boothby) shakes his head, but it is nevertheless true that the figures for trade between the Soviet bloc, including China, and the Western countries, before the war, were very small indeed.
I always understood that the Hong Kong and Shanghai Banking Corporation and Messrs. Jardine Matheson did very nicely before the war.
I am not saying that no trade existed, but I am saying that it did not make a very substantial contribution. It may have had marginal value to us as a nation, but it was not a substantial factor. Today—let us face this fact—the Soviet Union is taking an entirely different course. It does not seem to me to be possible that the volume of trade which we experienced before the war will be practicable in the new circumstances which have arisen, because the Soviet attitude is very clear and not unreasonable. It is to plan for economic self-sufficiency.
Stalin talked about "a Socialist world market," meaning those countries which subscribed to the Socialist creed, among which trade was to be done. That is certainly what the Soviet Union is doing at the present time. We have heard a great deal about O.E.E.C, but we have heard nothing about Comecon, the Russian equivalent, which has been very much more successful in bringing trade within the Soviet Union than we have been for our part in the West. I will give some indication of how successful this organisation has been in attracting trade with outside countries.
In 1937, 5 per cent, of Albania's trade was with the Soviet countries. In 1952,100 per cent, of its trade was with the Soviet countries. In 1937, Bulgaria did 12 per cent, of its trade with those countries and now it does 89 per cent, there. In 1937, 7 per cent, of Poland's trade was with those countries, and now 67 per cent, of its trade is within the Soviets. There has been a most remarkable concentration of trade within the Soviet orbit, and this is not merely due to chance. It is part of the political trade policy. We shall not be able in future to do the volume of trade with Russia which some people seem to imagine.
Some people will say, "Why is it that the Soviet Union is now taking the view that it must import more goods?" The answer is simple. It surely is that it has tried to over-expand the industries of the satellite countries. It has provoked discontent and food queues. The Soviet has to turn its mind away from the intensification of industry in which it has indulged in the last few years and turn its mind to food for the people. Because of that Russia has to import manufactured goods in the place of those which it is not manufacturing. This does not necessarily mean—and this is the point which I want to make to the House—that there is any change in policy. There may well be a change in tactics but it does not seem to me to be a change in policy which, so far as the Soviet orbit is concerned, is one of economic self-sufficiency.
I want to say a word about China and support the President of the Board of Trade in his view that the case of China is different from that of the Soviet Union. I am surprised at some hon. Members opposite seem to think that we can include China in the group of the Soviet countries. There is an immense difference. There is an immense difference in the way they treat our traders. Those who do trade with China today and actually sell goods to China do not get a square deal in the manner in which they are paid.
I was talking to one of my constituents last week-end. He told me the manner in which the Chinese played him up on the question of payment on his bills of lading. That is not very satisfactory for those who are genuinely trying to do trade with China. Moreover, I think that we have to consider very carefully the whole question of trade with China on a large scale. It can only come about as a result of our giving long-term credit. Let me say at once that if long-term credits are available, they ought to be available for parts of the British Commonwealth and Empire rather than for China. No enthusiasm for a new regime there should cause us to give to China large-scale credit which would be more usefully employed in parts of the British Commonwealth.
I think that we must take a very different view of China from that which we take of the Soviet Union. The Soviet Union, for all that it may be in other respects, has always been in trade matters scrupulously fair and punctilious in the way in which it has carried out its obligations. That is a most significant fact so far as the Soviet Union is concerned. We must look at the Soviet Union and its trading methods in a very different light indeed from the almost disgraceful manner in which China has treated our traders and our trade.
It is true that some countries must look upon trade with the Iron Curtain countries as more important than others do. This question is a balance between strategic considerations on the one hand and trade considerations on the other. Quite clearly if a nation is like ours, utterly dependent on export trade, it may very easily take a more agreeable view of certain classes of trade with the Soviet Union than, say, the U.S.A., which has little or no dependence on export trade.
In this connection, I think that we must force home to the U.S.A. our views on this matter. We have a real need to regard export trade as being more important than it is to the U.S.A. I am sure that if we put this matter to the Americans vigorously they will realise our point of view. After all, it is no use, despite what may have happened in other parts of the world in the last four or five years, reaching a situation in which the economic life of the nation is damaged because we refuse to do trade with certain individuals. We may do more harm to the cause of Western democracy that way than by supplying certain classes of goods.
I do not deny that these restrictions were necessary when the right hon. Gentleman put them on. I think that they have served a very useful purpose throughout their operation, but we have now a position in which, in relation to the Soviet Union, we are in a relatively much stronger position. We have now reached a position in which the balance of advantage lies, in a great number of cases, on the side of trade rather than restriction. I hope that my right hon. Friend, when he discusses this matter with the Americans and others, will make our point of view abundantly clear, because trade is the only way in which we can get in touch with the life of these countries.
As I have said, there are reasons of policy which I do not think will allow us to do an enormous amount of trade, but we ought to develop that trade so far as we possibly can; and through these trade talks we may be able to do something to improve the feeling between this country and the sphere of Soviet influence.
7.39 p.m.
This debate has been very instructive, and there has been no political tension on either side of the House. The only speech which I felt was rather pessimistic was that delivered by the hon. Member for Cheadle (Mr. Shepherd). I hope that as a lone Scot I shall not intrude anything which will cause dissention in our debate tonight.
We are trying to develop our own internal economy, and we recognise that, as an island community, this is not possible unless we trade with the rest of the world. We are not exclusively arguing tonight for East-West trade. We are trying to explore the question of what markets it is possible to find. There has been some evidence already of an American recession in trade, and it is admitted that if it reaches the extent of 10 per cent. unemployment in America there will be very serious unemployment in this country. Therefore willy-nilly, and as a result of a lessening of war tension, we are entitled to look to the other side of the globe. As my hon. Friend the Member for Nelson and Colne (Mr. S. Silverman) said, this debate covers half the world's population. Therefore, we have every reason to argue the case on the basis of the economic and industrial problems that face us.
The Russian trade representatives themselves have told me that when our people go to Russia to try to find an opportunity of trading in capital goods, the iron curtain is at the Board of Trade. Our shipbuilding industry has orders which will keep it going for the next two and a half years. The Russians have for a very long time been trying to get cargo ships, tankers, and smaller craft of that nature, but if they ask for vessels of 10,000 tons they cannot have them. We are told that they are strategically goods and it is dangerous to let the Russians have them.
Obviously, no one can precisely define strategical goods apart from tanks or actual weapons of war. We must recognise that the Russians are asking for our shipbuilding products. Shipbuilding, locomotives and tool-making are the most important industries of the West of Scotland. If there is a decline in our shipbuilding, there will be a complete collapse of the whole Scottish economy.
Apart altogether from trade with foreign countries, the difficulty of the shipbuilding and engineering industries is they cannot re-equip themselves to meet the demands that might be made upon them. The steel industry is far behind in the supply of steel plates. It cannot prepare a proper capital investment programme unless shipbuilding and engineering place their orders, but shipbuilding and engineering cannot do so unless they get orders from other parts of the world.
It is already common talk that we are being ousted from the shipbuilding and engineering markets by Japan and Germany. Glasgow alone has about 20,000 unemployed, a figure which is higher than in any other part of the country. The Board of Trade must recognise there is a claimant demand from the East for trade and that we can supply the goods.
In the two days' debate last year on Scottish industry, the President of the Board of Trade was critical of us, and said:
Nobody argues China is as highly developed or pays its way as rapidly as Russia, but obviously China is a market. The whole of the eastern world is a market. It might be argued that if we are to give long-term credit, we should give it first to the Colonies and to the Commonwealth countries. Nobody denies that. I am satisfied, however, the greater part of the eastern world will require, through some central organisation, with the British Government well in front, to adopt some form of long-term credit for the building up of those countries. China is entitled to be associated with it. From my knowledge of trading, I am satisfied that, as the Prime Minister said less than a month ago, it eases the war tension.
When my right hon. Friend the Member for Huyton (Mr. H. Wilson), as President of the Board of Trade, introduced the restrictions, there was obvious reason for doing so; there was tension all over Europe and there was justification for what he did. But not even responsible Members of the Government, including the Prime Minister, will deny that the tension has eased and that we are entitled now to develop trading. I hope that, as a result of this debate, when trade delegations go to Russia they will be able, in consequence of the easing of restrictions on licences by the Board of Trade, to fix firm contracts.
The strongest force in the world today is nationalism. As a result of our earlier trading as an Empire, we must assume we are capable of trading freely with those people, and we should give them long-term credit. I hope the Minister who replies to this debate will indicate what strategic goods will be barred, and that relationship will improve in the development of trade between this country and Russia or China, and that the right hon. Gentleman will show something is to be done to ease the situation in the Far East. To that extent, I hope that this debate will have made its contribution to the flow of world trade.
7.49 p.m.
As many hon. Members have said, this has been a remarkable debate in that there has been almost complete, if not complete, agreement on both sides of the House. That is because we are discussing something which is of equal importance to us and to our constituencies which have manufacturing industries or industries that consume raw materials from overseas.
The right hon. Member for Huyton (Mr. H. Wilson), the former President of the Board of Trade, referred to the fact that we first started to discuss this subject in 1947, when he signed the first trade agreement with Russia. I gave him my support from the benches opposite because that agreement involved the purchase from the Soviet Union of over one million tons of coarse grains which was desperately needed by farmers in the United Kingdom. I have a feeling that my right hon. Friend the Minister of Agriculture was a little disappointed a year or two ago that he did not have the same success in getting coarse grains from Russia as we had in 1947.
The President of the Board of Trade told us quite clearly of the importance that he attaches to this particular market. He said that Russia was a substantial potential market, and that greater mutual trade leads to an increased standard of living for all concerned. Russia and East Europe, as he reminded us, are not only a market for our goods, but also a source of supply for our basic raw materials. The trade we do with other countries is of mutual benefit to us, and it is on that note that we are discussing this subject tonight.
There has been a feeling over the last few years that, because of the strategic aspect of many of the goods wanted, the advantage only goes to the buyer. We know it does not. This should be trade between a willing buyer and a willing seller. The manufacturer is glad to sell his goods, and he asks for a fair price that would give him a profit. If he is beaten by a foreign competitor, that is all in the game. The buyer is pleased to get our goods because he knows that British quality is the best in the world. That is a particular reason why we should see that our goods get to these markets where they have been hitherto restricted so that we can regain the customers we had in the past.
The President of the Board of Trade told us that pre-war 4 per cent, of our exports went to Russia, but that now the figure was only a half per cent. Not only had the Government and the Board of Trade been keeping a watch on these matters, but in November the Federation of British Industries issued to their members a most useful statement. They had also been studying the matter for some time, and I should like to quote a few lines from this statement. They first pointed out that the improved East-West trade was not a cure for all our economic problems, and having covered themselves in that respect, they went on to say:
The Federation report, goes on to say that if trade with China is neglected, it
If a businessman goes behind the Iron Curtain, he is often pursued on his return by a bevy of reporters. He may only conclude negligible business compared with what might have been picked up in other parts of the world, or he may get a considerable quantity. But someone writes a humorous article about it, and a certain feeling about businessmen going behind the Iron Curtain is propagated. I hope this debate will put in its right perspective the importance of this business.
Reference has been made by many hon. Members to the recent visit of businessmen to Moscow. The President of the Board of Trade has told us that they concluded contracts for £12½ million, of which £6½ million have been approved. Many of us have had an opportunity of speaking to these businessmen and hearing of their experiences while they were in Moscow. I think some of them were a little bit disappointed at the reaction of the Board of Trade when they came back. Before they went they made very careful inquiry, and they were told—indeed, it was publicised—that they had the blessing of the Board of Trade and of the Foreign Office.
They covered themselves from every conceivable angle, but the "Financial Times" of 26th January reported: I think they had all discussed in detail the sort of goods that they were going to offer, and for which they hoped to get orders.
When they came back they called the bluff of the Board of Trade. They said, "We have got the orders, so what happens now?" Then they began to hear about such things as quantitative controls, and other matters which, although they may have been told about them before they went, they had not fully appreciated. We hope that as a result of further considerations of their orders and the steps which the Government are taking, these people will get licences for the larger part of these goods.
The President of the Board of Trade has once again assured business men that any help which the Board of Trade can give will be available. I myself have been interested in this subject for some time. I remember writing to a former Secretary for Overseas Trade and suggesting that he should arm business men with a letter when they are going behind the Iron Curtain stating that they are travelling on the legitimate business of the United Kingdom. I believe that is done by the United States of America. Some of those who travel with Russian visas on their passports experience unavoidable delay in getting across frontiers from one country to another, and not only unavoidable delays of that nature but further delays when they come home.
I saw in a newspaper on Saturday that some of these men who went to Russia entertained certain fears about travelling elsewhere in the future. They now say some of them may be refused visas for the United States. It may be they are not being refused immediately, but they are told that the matter now has to be referred to Washington. These are business men to whom we have been giving much credit in this House this afternoon, and I hope the Minister of State, Board of Trade, can assure me that he has had no information of that sort, and that he is satisfied that if any of these business men who went to Moscow recently apply for visas for the United States they will be granted immediately.
Is the hon. Gentleman aware that the McCarran Act puts a prohibition on the State Department or its consular officers abroad to granting any visa to enter the United States to any person who has visited a country behind the Iron Curtain except indeed on official business?
I note what the hon. Gentleman has said and hope that those recent visitors, and any future business men who go on such a journey, will be regarded in the same way as an official.
With other hon. Members I was anxious to quote what the Prime Minister said, because it is the reason for this debate, namely, that the more trade there is through the Iron Curtain and between Great Britain and Soviet Russia and the satellites, the better still will be the chance of our living together in increasing comfort. I am sure that those remarks had a powerful influence on the choice of the subject for this discussion. My right hon. Friend went on to say:
We are constantly hearing of other countries doing business which British businessmen are not allowed to do. My right hon. Friend asked us to use restraint in bringing forward such cases. I have two examples which I had intended to use, but I will write to my right hon. Friend about them. One concerns chemicals from Western Europe being shipped across England, via Liverpool, to China which British manufacturers are not permitted to export from United Kingdom sources. The other concerns goods coming from across the Atlantic, being repacked in Europe and sold to Iron Curtain countries.
One complaint from our businessmen is that they see their competitors in other countries taking the orders which they feel this country should have. Over two years ago I wrote to the Board of Trade asking for an assurance that no member of the N.A.T.O. Powers, the European Defence Community and Japan should be allowed to send goods to the Iron Curtain countries which British manufacturers were not allowed to send. Even two years ago I could not get such an assurance. I received only a vague reply to the effect that what we considered in short supply might not be in short supply in other countries, and that other countries interpreted the spirit of United Nations resolutions differently from ourselves. All these things make for friction between the nations concerned, and so this debate will do much to clear the air in that respect.
There is a vast area with which we can trade in addition to Russia. There is Eastern Germany, whose 18 million people under Soviet control have many cultural links with Western Europe. Many of their towns, such as Leipzig and Dresden, are highly industrialised and would like to renew their contacts with the West which have been interrupted for the past few years.
Industry will rely on the Board of Trade to give all the guidance necessary to pursuing these matters and we all hope that the problems which my right hon. Friend is now discussing with our Allies will be speedily solved.
8.5 p.m.
Almost everyone has commented on the great change in the climate of opinion that has taken place in the past year with regard to this issue. It is the case, I suppose, that not only have we had a much more unanimous debate on this subject today than we could have had some time ago, but we have had a much more unanimous debate today than we have had in almost any economic debate that I can remember over the past five years.
No doubt this was due to some extent to the vagueness of the speech of the President of the Board of Trade earlier this afternoon, because he refused to discuss the question of what should or should not be on an amended strategic list. I suppose we all came to the debate expecting the right hon. Gentleman to say that the view of the Government was that certain amendments should be made, but that a strategic list of some kind should remain in being. The right hon. Gentleman told us that this was the view, but he did not give us any indication as to where he thought the frontiers should be fixed. If we had got down to discussing where those frontiers should be, there might have been a little more disagreement than there has been.
None the less it is significant that we have been able to have a debate with such a degree of agreement, and undoubtedly what has brought about this change over the past year is the great internal change in the economic policy of Soviet Russia and of the countries associated with her. And that has come about at a time when it is fortunate for us in one sense that she is, temporarily at any rate, looking rather more towards the outside world, because it will be useful for us if we can have trade on a larger scale with Russia.
I did not disagree with the hon. Member for Cheadle (Mr. Shepherd) when he said that from a long-term point of view there were many indications that the Soviet Union and those in the Soviet bloc were pursuing an autarchical policy, but it is obvious that the pressure to pursue that policy has been decreased, and that the Soviet Union wants to do a great deal more trade with the Western world. Therefore, because from a long-term point of view there may be some autarchical desire, that is no reason why we should not do everything in our power to make the fullest possible use of the opportunities presented to us.
I share that view, and I would go even further and say that, although at the present time I feel it is only a matter of tactics because of the set-up in the satellite countries, if we get on with this trade we may still persuade people in the Soviet countries to carry on trade which otherwise they might not carry on.
That is another example of agreement to add to the general agreement in the debate today.
One encouraging sign that the Eastern countries are serious about doing trade is that there has been much less propaganda about East-West trade than there used to be in the days when they were not serious—for instance, there has been an absence of propaganda about the Geneva Conference. In fact, the less the Russians concentrate upon propaganda, the more serious they are about trade. That is something of which we should take note.
There has been much discussion about the decision of the British Council for the Promotion of International Trade, and the extent to which business should be done through this or a similar body. I do not know much about the council, but I should have thought that it had done good work at stages when nobody else was doing it. However, I am glad that the Russians are not now taking the view that they can deal only through this body, and it is a pity if, as I believe is the case, the Chinese are taking a rather different view. It is desirable that we should have such bodies in existence, but it will be a great pity if they are to be in a monopoly position and if there is any impression on the part of Western countries that they are being used, even if that is not so, for political purposes.
On the other hand, if it is the view of the Government that there is a danger in dealing exclusively through bodies of this kind, they should not take the very negative attitude which for a brief time they took before the Moscow meeting but should go ahead and, if necessary, set up a government-sponsored body, above political suspicion, to deal with these matters. We had a Dollar Exports Board and perhaps we should have a roubles export board, semi-official and semi-private, to deal with matters of this kind.
We would be foolish to imagine that there would be an enormous expansion of trade, but it could be fairly substantial. The desirability of such expansion of East-West trade is pretty obvious at the present time, because it is clear that the American recession is deepening. Certainly there is no sign of it showing an upward turn. It is also clear that the immunity from its effects which we in this country and the rest of the sterling area have enjoyed for some months is not likely to continue indefinitely. That being so, we should certainly be seeking what other trade outlets we can find.
It is the case, of course, that the most worrying feature of the economic picture in this country, which in some ways is not too bad, is the position and prospect of our exports. That ought to be causing us more worry. I am not altogether happy about the Government announcement made at the end of last week that the area within which transferable sterling can be used has been greatly extended. I am not happy about the effect that that will have on our exports. It seems to me that Middle Eastern countries outside the sterling area, in so far as they earn sterling surpluses, will be in a position to use that sterling to buy goods from Western Germany instead of from this country. Therefore, the change which has been announced may have quite a disturbing effect upon our already dangerous export position. That is a reason for being rather more careful than the Government have been in taking steps of this kind. It is also a reason for seeking whatever other outlets we can find for our exports.
As to the lifting of the restrictions on strategic materials and the effect that this may have on our relations with the United States, I would say that there is a general tendency in this country to associate this question of strategic restrictions a great deal too much with the United States. There has been, of course, a great deal of hysterical passion in the United States on this issue. Anyone who has been in the United States recently knows that there is no issue upon which certain sections of American public opinion feel more strongly than on the question of British trade with China. This is also the issue upon which sections of opinion in the United States are more misinformed than upon any other. The American agitation has been largely a popular, misinformed agitation rather than anything stemming from the American Government themselves.
While Measures like the Battle Act have been on the statute book of the United States, they have had little if any effect upon the restrictions which have been in operation. These restrictions have been largely imposed by successive Presidents of the Board of Trade in this country, starting with my right hon. Friend the Member for Huyton (Mr. H. Wilson), under some pressure from the present Prime Minister. The United States have nothing much to do with it. As my right hon. Friend the Member for Huyton and the Prime Minister are now in favour of diminishing restrictions, I should have thought that that was about all that there was to it, and that we could get on fairly rapidly in that direction. This is an issue upon which there has been strong popular feeling in the United States, but it has been misinformed feeling about which, on the whole, we ought not perhaps to worry too much.
What sort of trade can we hope to do, and on what scale? A figure of £400 million over three years has been mentioned. I do not know whether the Minister of State, Board of Trade, can inform us whether these are £400 million worth of goods which the Russians have decided to buy from the United Kingdom, provided that we can make goods available at reasonable prices, or whether these are £400 million worth of goods which the Russians want from the West and for which the United Kingdom, among other countries, can compete. That is a very important difference indeed. Information on that point would be extremely interesting.
Then there is the general question of payment for these goods. I think that we were all pleasantly surprised when Russian gold started to pour in at the end of 1953. Every word that has been said by my right hon. Friend the Member for Huyton and others about the very substantial effect that that has had on our bill position in 1953 is perfectly true. But I suppose that there is no Russian intention, even if there were a Russian possibility, of paying for a very large amount of the £400 million of trade by the export of gold to this country. I suppose, also, that at a certain level of gold importation we should not want it, because although gold is an extremely valuable commodity for settling balances that postulates a position in which everybody would want to settle with gold, and one can visualise the ridiculous situation that would follow. In any case, I do not understand that there is any Russian desire to settle the whole amount or even a very substantial amount in gold.
On the contrary, the Russians have been rather worried as to whether they would get a firm undertaking from us that we would buy guaranteed quantities of other goods from them. It would be very interesting to hear from the Government what goods are to be bought and what the export possibilities are.
The Scott Mission reported that every contract was going to be properly met by the opening of a confirmed credit through the Moscow-Narodny Bank in London, so the question of payment by gold did not arise. The Russians were perfectly willing to open an appropriate and perfectly safe credit.
If I may say so, I am not sure that the hon. Member is not getting a little confused among the trees of individual firms as opposed to looking at the wood of the overall trading position. While it would be reasonable for firms to say, "Our credit is all right. We have credit with a reputable bank," as a nation dealing with another nation we have to look further and find how the credit is provided out in real terms. There are indications that the food and grain position in Russia is not particularly good at the moment. One would like to know more about that, and also about the timber position.
This change of attitude on the part of Soviet Union has come about at an extremely opportune time for us, and we should take whatever advantage of it that we can. Reference has been made to machine tools. That industry had a traditional tie with Eastern Europe. It is no doubt very desirable from the point of view of their long-term health that industries of that kind should be able to develop that traditional trade on a large scale. At the same time, from the point of view of local employment I should not like to see individual firms become tied too much with Eastern Europe.
There has been this change of policy, but one cannot exclude the possibility of another change in an unwelcome direction in the future. At the same time I suppose that there is no great danger of that happening to a large extent. Subject to that, we all welcome the change, but we do press the President of the Board of Trade very hard to act quickly and decisively on this matter, so that this country will not lose any opportunities that are offered.
8.20 p.m.
The first point I want to make arises from a remark made by my hon. Friend the Member for Holland with Boston (Sir H. Butcher) when he talked about the difficulties of trade with China. I certainly realise that there has been the greatest difficulty in trade with China in the last three or four years, and even if one looks back over a longer period; but I feel that China is a large agricultural community with an extremely low standard. Members who, like myself, have travelled through Chinese villages, will realise the extremely low standard which exists there. China needs now, more than ever, industrial help.
At the moment, I feel that perhaps China has learned her lesson and realises that she cannot achieve what she set out to do by force. On our part, I think we have to realise that China has been at war for over a generation, and that she sought to lead her young men to believe that she could achieve all that she wanted by military force in her adventures first in Korea and then in Indo-China.
I think that the time will come very shortly when it will be possible for us again to develop trade relations with China, and I hope that we shall realise the great advantages which there are in such a development. There is no doubt that, at the present moment, just because we cannot get from China what we want, we should not say that the western world cannot trade with her. The first requirement must be to raise the low standard of living of the Chinese people, but I do not think at first that we in the Western world alone can necessarily do that. I think the first stage in the process is to develop trade between Japan and China.
In my experience, having dealt with the Japanese armament industry in the war, Japan and China are two countries which are economically inter-dependent, and, although a correspondent of "The Times" recently gave a figure of 10 per cent, for all the trade between Japan and China in 1937, I should say that, from 1938 to 1945, that trade was considerably bigger.
Japan could meet many of her requirements from China, including coking coal, iron ore and oil seed cake, and help China industrially. In fact, I do not think we shall be able to keep these two countries apart, though undoubtedly, there is a grave risk which we might be taking in encouraging that trade between Japan and China. It may be that Japan may be absorbed into the Communist sphere of influence, but I personally think the risk is far greater if we do not encourage Japan to pull China out of the Communist sphere of influence.
I do not think that, in the end, trade between China and Russia can develop because of the long land lines of communication. Trade will come to the West, because it is by shipping and not by rail that trade can best be developed with China. Though there are grave difficulties in encouraging this trade, I trust that we shall not forego that risk, because I think it is along these lines that there might come the development which we seek in pulling China out of the Russian camp and in developing good relations between her and the Western world.
8.24 p.m.
Having been present throughout the whole of this debate, I find myself in almost complete agreement with all that has been said.
Very clever.
Within the limits of the question we are discussing today, the degree of unanimity which has prevailed will be of great encouragement to thousands, nay millions, of men and women working in the industrial areas of this country. In addition to that, it will at last give encouragement to those businessmen who pioneered this new hope in the relationship between our industrial centres and the potential markets which are at our disposal if only we are prepared to take advantage of them. Therefore, as one who has now served in this House for 19 years, who comes from the greatest industrial area in this country and who lives in the area most vitally affected by this question, I welcome this opportunity of making a few observations.
First of all, I should like the Minister, when he replies, to be good enough to give me the answer to some questions which have arisen in my mind while the debate has been in progress. I liked the approach of the President of the Board of Trade to this question today, but what I could not understand was the differentiation in that approach towards the possibility of increased trade with the Soviet Union and in his approach to the same question concerning China. I can remember how, many times during the closing days of the life of Ernest Bevin, he said to me, as a broken-hearted man who realised what was taking place, "We must maintain the very best possible relationships with that huge continent of China." Anyone who has been a student of economic affairs and of our industrial relations with other countries must re-echo Ernest Bevin's words tonight.
It was my privilege for many years, while working for my living, to work with students from all over the world, and I have some very happy recollections. It was a privilege to work with a large number of apprentices who came from all over the world, including India, Russia, Africa and even China. I am convinced that there are mountains of goodwill towards this country existing in China. The hand of friendship is being held out, and rather than thrust it to one side we should make it clear in this debate that it is our desire to make the same approach to China as we are making towards the Soviet Union.
We shall be lacking in our duty if we do not give credit where it is due. I make allowances for the difficulties facing the President. At the same time the treatment received by British businessmen in the early days was a little unfair when we consider the great responsibility they had to shoulder. Now they have pulled through, because of their courage and enterprise and the support of their managements. We should place on record our satisfaction and appreciation of the initiative shown by those men during the difficult early days.
I have in my hand the memorandum which was given to the British businessmen in Moscow on 4th February. I cannot quote from it to the extent I should like, or to the extent which it deserves. I have no doubt that copies will be filed at the Board of Trade. But there are a few extracts which I think should go on record so that when this debate is considered they may also be considered. The memorandum states:
Britain was once looked upon as the workshop of the world. There are many in this country, in all walks of life, who think that is no longer true. But it can apply in a modern setting provided we adjust ourselves to the new world situation. If we adopt a correct policy there is still great hope for Britain and the British people. We can still be a great workshop of the world providing we play the game with others. We should accept the hand of friendship now being offered to us. We should follow the initiative taken by the British businessmen and others.
I wish to plead for a great expansion of trade between this country and the whole of the East—with the Soviet Union and all the countries associated with them—and with China. Our postwar economic situation demands it. We have led the world in the development and perfection of nuclear physics. It is true that another important country is claiming the credit for that. But anyone who knows what happened at Rugby, at Trafford Park, at Birmingham and at Manchester College of Technology knows that it was our men who night and day before the war—and especially until the air-raids prevented us from going on with those experiments and research—perfected what was taken advantage of by another country. In many respects we have led the world in scientific development. We have spent millions of pounds on research, and our young men in the laboratories have worked day and night. As a result of our efforts we have led the world in much scientific development and in much engineering.
I am convinced that the time has arrived when Britain should take the initiative in world affairs now that the world is ready to respond to that initiative and that we ought not to be dragged at the heels of other countries which are in a strong position because they have great resources in comparison with our limited ones. I urge that the new policy should be known as the "New Start," based upon the complete unanimity which has prevailed in this House as representing the British people. We still have some of the finest scientists and engineers in the world. Our engineering products are admired throughout the world, and it is the desire of our people to work for the world and with the world. Britain's future depends upon whether we adopt this policy in the mid-twentieth century when a world market is required. I believe that, with world harmony established on an economic basis, there would be the possibility of a great expansion in world trade.
It was my privilege before the war to listen to men like H. G. Wells speaking just as I am doing now. During the war Mr. Wendell Wilkie came over here and spoke in just the same way as I am speaking now. Also, anyone who knew Ernest Bevin knew that, fundamentally, he also desired this new approach to world problems. Mr. Cordell Hull once wrote: Those words are as true today as when that great American statesman wrote them.
That is the basic issue of the world—the need for world co-operation. I believe that we can assist to build and consolidate world peace by the "New Start" which the House demands with unanimity. As Members of Parliament, we all have the right to receive White Papers, blue books and publications by various international organisations, and anyone who studies those documents must agree that the world needs to make a new start to deal with the present situation.
With the population of the world rising at its present rate and with food production lagging behind, millions of people, who are as good as any of us are but whose skin may be a different colour, are going short of food. Millions are living upon a low standard. Several continents have hardly been touched from the point of view of economics even at mid-twentieth century. These are our problems—and our opportunities. It is a basic world problem, and Britain can again take the initiative if it responds to the appeal made from all parts of this House.
Any one man, any one party or any country that quibbles about this issue nowadays is endangering the future of mankind and the peace of the world. The representatives of Metropolitan-Vickers. English Electric, the General Electric Company, and the machine tool manufacturers who are in Moscow at this very minute cannot quibble. They have great responsibilities. They have never lived by talk, but by obtaining orders from all parts of the world and accepting the responsibility of carrying them out in co-operation with the thousands of workpeople whom they employ.
Big industry, in the main, produces big men with a big outlook. They are responsible for great capital and for assisting to maintain full employment. They need to plan. They cannot think only of their position at the end of this year or next; they have to plan three, four or five years ahead. Because of the gradual contraction of markets which is now taking place they are eager to buttress up their position and to adopt a long-term approach to assist full employment and fulfil their responsibility.
It would have been wrong of me not to have spoken in this debate. For years, while millions of fellow-craftsmen as good as I were signing on at the employment exchange, I was kept in full employment. At Metropolitan-Vickers, Cravens, Kearns, Churchills, and all those tool manufacturing centres in Broadheath, Timperley, Stockport and Reddish, from 1929 to 1935 the men were kept in full employment because of the large orders received from many parts of the world.
I shall never forget the Russians saying that it was their desire to order automobiles and motor lorries from all parts of the world. They said that they were having to pay more for the Leyland than for any other lorry but would take all that Leylands could send because, within a relatively short time, they saved on maintenance charges the extra they had paid.
British businessmen have told representatives of industry that what they like about the prospective trade now being offered is that it is high quality goods that are being asked for, and that price is not the main factor in securing orders. I am not for a moment saying that price is not very important. But I do say that, in contrast to many markets, it is high quality and not price which is the main factor.
I have here concrete evidence to support what I have been saying. It is admitted that we have some of the finest machine-tool manufacturers in the world, and I quote the following as one example. In 1930, 26 per cent, of the total output of Asquiths' Machine Tools went to Russia; in 1931, 89 per cent., and in 1932, 60 per cent. We can therefore understand why large engineering concerns, remembering those days, should again be concerned about the position.
There are great potential markets in India with its 360 million people, Russia with its 250 million people, China with its 500 million people, and many others. The hon. Member for Edinburgh, South (Sir W. Darling) will, I know, agree with me when I say that these are the mighty continents that will buy our power plant, turbines, machine tools, ships, textile machinery and locomotives, enabling us to maintain full employment and reduce the cost of production, because by running our factories 24 hours a day overhead charges are automatically reduced. That would put us in a stronger position. Those who put the interest of their country first are bound to agree with the unanimity of opinion that has prevailed in this House today.
I should like the Minister to give unequivocal answers to one or two questions. On page 8 of "The Times Review of Industry" for this month, it says:
There is some uneasiness in industry on this point and the hon. Gentleman will be rendering a great service to those people who accept these great responsibilities if he will make this position clear. It may be difficult to believe what I say, but I am told—and if it is true it is deplorable—that after eight years of appeals to increase exports and output, businessmen who receive orders amounting to £16 million come back from their travels uncertain whether they will be able to conform to the delivery dates or otherwise carry out these orders, because they are not aware of the limitations.
I have felt for a long time that there has been a change in the atmosphere. Unfortunately, there are many Conservatives in all political parties, and they are very slow to see the change that is taking place in this 20th Century jet age. What is right today may not necessarily be right tomorrow. I was very pleased to hear the President of the Board of Trade pay a tribute to my right hon. Friend the Member for Huyton (Mr. H. Wilson) who was President of the Board of Trade in the Labour Government. The United Nations Economic Survey for 1953 states on page 46 that Marshal Voroshilov had referred to This was a quotation from "Izvestia," on 7th November, 1953. I believe that is so. Therefore, rather than seeing us dragged at the heels of others, or be left behind by them, this House, with its unanimity today, demands that the Government should make it quite clear where we stand. The same United Nations report states that we need a faster increase in the standards of living of the people of the world. The Soviet Union are adopting a policy of expanding consumer goods industries, in line with that report. They are expanding agricultural output and consumer purchasing powers. They are giving a high priority to consumption, and all their plans for the production of consumer goods are being revised in order to quicken delivery.
This is concrete evidence of the change that has taken place in the Soviet Union. There are great potential markets for us in China, Poland, India and Russia. We should make it clear that we want to respond to the needs of these mighty countries, where millions of people have been held back long enough. Let us once again become the great workshop of the world, supplying the world's peoples with their urgent needs.
8.52 p.m.
If one thing is evident from the speeches in the debate this evening it is that, whatever may have been true at any time in the recent past, there is no longer any positive ill will on the part of anyone in this House—or, I think, on the part of anyone on either side of industry—towards Russia and the Russians. We have come a long way over the last eight or nine years to arrive at that decision.
My right hon. Friend the Prime Minister made his remarks about trade with the Soviet Union during a debate on foreign affairs and defence, but since we are discussing this subject tonight mainly from the point of view of trade between ourselves and countries behind the Iron Curtain, we should do well to concentrate our minds on the trade aspects of the matter and take, as a sort of bonus coming to us from our trade, any improvement in relations between the two countries. We trade with other countries, not because we like them, or because we specially want to do them a good turn or serve their interests. Those are by-products of our trade with other countries, with the possible exception of our Colonies and the Commonwealth countries.
If we enter into trade of any kind with the Soviet Union, China or the satellite countries, we find ourselves doing ourselves and our industrial life a service and, at the same time, inevitably rendering a service of some kind to the economy of the countries with whom we trade. It is at that point that we find ourselves in an appalling difficulty over what is to be on and what is to be left off the strategic list.
I want to add a word to what has been said by the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) about this strategic list. Our industrialists and those who help us in our trading operations abroad are placed in a false and difficult position unless it is made perfectly clear what strategic goods are to be barred from international trade in any quarter of the world. If a typewriter is not a strategic article and is not on the barred list and is exported to the Soviet Union, and is used in the Soviet Foreign Office in the preparation of propaganda against the West, then that typewriter is used as a weapon against us in the psychological warfare in which the Soviet Government seem to be engaged at the present time.
If we allow the Russians to have made for them in this country a tanker or a freighter and it is used to carry oil or ore from any country to a port in the Soviet Union, then that tanker or freighter is used as a weapon in the cold war against the West. There is no line that can easily be drawn between strategic goods and non-strategic goods unless the Government are prepared to make a bold definition and say that guns and tanks and planes and shells and other positive and recognisable weapons or instruments of war are prohibited goods; and that, apart from that definition, recognising that trade between one part of the world and another helps the economies of those two parts, we are prepared to enter into trade negotiations in the hope of being able to do business, one with the other, in other articles.
The hon. Gentleman will agree that the reverse is also true, will he not? We import coarse grains and timber, and we could not wage war without those?
The last thing in the world we want to do is to wage war of any kind, hot or cold.
We find ourselves in this position vis-à-vis the Soviet Union because the Soviet Union has forced us into a defensive position in a cold war not of our choosing. We are willing to accept from the Soviet Union goods needed in our economy, in return for what we can send there. I plead with my right hon. Friend to make clear precisely what are strategic goods, what exactly are the limits of the goods listed and barred from the trade that we want to carry on.
8.57 p.m.
I am very grateful to my right hon. and learned Friend the Member for St. Helens (Sir H. Shawcross) for allowing me a few minutes of his time. Like most hon. Members who have taken part in the debate, I welcome the changed atmosphere in which we can talk about East-West trade. It was a subject about which one had to speak with one's tongue in one's cheek up to 12 months ago, for at that time there was a distinct possibility of being labelled, if not a Communist, at any rate a fellow traveller. Now, as one of my hon. Friends said, so many have got on the band wagon that there is no room for the driver.
My interest in the subject is a constituency interest, because those business men who went to Moscow intimated when they returned that the Russians are anxious to buy £140 million worth of ships. There is concern and anxiety in the shipbuilding towns about the future prospects of the shipbuilding industry. Although most yards have two or three years' work on hand, in the last 12 months orders have not been forthcoming in anything like the quantity they were up to the end of 1952, and in consequence many of the shipbuilding yards foresee unemployment being the order of the day from 1956 onwards. In constituencies such as mine, in which the whole community was thrown out of work because of the decline and concentration there was in the one industry, the people are concerned about the rather dismal prospects for the future.
I hope that when the President of the Board of Trade revises the proscribed list and determines what are strategic goods he will look very carefully to see whether he cannot allow ships of all kinds and sizes to be bought, if the orders are forthcoming. If he permits that he will do nothing contrary to the policy which has been pursued by practically every other N.A.T.O. Power over the last two or three years. I quote from the "Manchester Guardian" of 18th July, 1953:
It is not only this country which is affected by the strategic ban. A report in the "Manchester Guardian" of 28th December, 1953, says: parts of the Colonial Empire, we must look at this matter again.
I promised my right hon. and learned Friend that I would speak for only five minutes. I have much more to say but I want to keep that part of the bargain. There is no question that throughout British industry today, and particularly among ordinary workmen, there is a fear that the effects of the American recession may be felt here. All of us know that the only hope of safeguarding ourselves against the effects of that recession lies in the building up of alternative markets. I therefore add my plea to those which have already been made to the President of the Board of Trade. I ask the right hon. Gentleman to do everything he can to see that this list is so revised as to be made almost innocuous, because that will mean employment for our people. Upon the basis of expanding world trade, I think it may be possible to build a stable and decent international peace.
9.5 p.m.
We have had what, in some respects, has been a very remarkable and, in all respects, a very useful and constructive debate. It has included—and perhaps the hon. Member will allow me to congratulate him at once—an admirable maiden speech from the hon. and gallant Member for Arundel and Shoreham (Captain Kerby), who in the course of it made some of the most controversial observations I have heard with a charm and confidence and a devotion to lost causes which leads us all to hope that he will speak many times in future in this House.
The debate is now to be distinguished, if I understood the hon. Member for Bury and Radcliffe (Sir W. Fletcher) aright, by the maiden swim of a political coelacanth in the person of myself. I cannot claim that familiarity with politico-marine biology which distinguishes the hon. Member, but I would simply make this observation. The coelacanth is a remarkable fish possessing at least four notable characteristics. It is of long life and great endurance. It never deserts its home. Unlike the political minnows who drift and paddle in the more stagnant if more blue waters, it never speaks unless it has something to say. It has a sting in its tail which it uses without wasteful prodigality but when occasion requires. This is not a case when any stings of that kind will be needed.
I thought, when listening to this debate, that it was one that was all the more useful and all the more interesting because it revealed a very remarkable, a very objective and a very general concensus of opinion on both sides of the House unbedevilled by merely party political considerations. I could not help thinking how useful it would be if on other trading and allied problems, such as those affecting the vast underdeveloped areas of the world to which the hon. Member for Nelson and Colne (Mr. S. Silverman) referred in such sober but moving language; or, coming nearer home, the problems of trade concerning our own Colonies to the great potentialities of which hon. Members opposite pay a great deal of lip service and very little else, we could have frank and objective debates of the kind we have had today on this particular aspect of our foreign trading relations.
My right hon. Friend the Member for Huyton (Mr. H. Wilson), in opening this debate, made it quite clear that we have not found it necessary, as it unfortunately so often is in regard to other matters, to direct any special criticism against the policy of Her Majesty's present advisers. It is true that the right hon. Gentleman the President of the Board of Trade was perhaps studiously vague and platitudinous in some of the things which he chose to say. It is true that there appears to be in this matter perhaps the same lack of any sense of urgency—perhaps the same trace of that too-little and too-late policy—which often characterises the activities of Her Majesty's Government in other directions.
It is true that the present operation of our trading intercourse with the Communist countries is marked by grave and harmful delays and by a great deal of uncertainty, confusion and muddle. But our object in raising this subject for debate has not been to hold an inquest on the past—rarely a very useful exercise—but rather to urge the Government to somewhat greater activity in these matters in future. We welcome the general statement which the President of the Board of Trade made so far as it went, and we are glad to have his assurance that the Government are seeking to promote the expansion of trade with the Communist countries.
I say "with the Communist countries." I am not sure that the President of the Board of Trade said that. He appeared to be at pains to exclude from the scope of what he said one Communist country which occupies a very large area of the earth and whose enormous population may well provide, if and as its living standard is increased, a great potential source of increased trading relations. I regretted that the right hon. Gentleman had not found it possible to say anything about the eventual resumption of normal trade relations with China. That is a matter which, I recognise, presents certain different considerations to those affecting our trade with the Soviet countries in Eastern Europe. I want to speak about it with moderation and responsibility, but it is a matter of the greatest importance to this country, especially in view of the position of Hong Kong, depending, as it does, on its entrepôt trade and in view of the economic situation of Malaya, to which my hon. Friend the Member for Jarrow (Mr. Fernyhough) has just referred.
I fully realise the difficulties in regard to this matter. It was I myself who, as one of the right hon. Gentleman's predecessors, in the office he now holds, tightened up the security controls against China in the early part of 1951. There were special considerations at that time. But the situation is, we have at least some reason to think, now beginning to change, and it ought to be made clear that if, as we all hope, some measure of political settlement is reached at the Geneva Conference in April, we will at once proceed to review the existing embargoes on trade with China in the hope that ultimately and before too long we will be able to resume what has always been a most valuable trading relationship. We shall be glad to hear a definite statement from the Minister of State, Board of Trade, as to the future prospects in this matter.
I agree with the hon. Member for Bury and Radcliffe that, whether it is a question of trade with China or with Russia, this is a two-way relationship. It may be that in the past we have not had much obvious evidence of a desire to trade with us. But there is now some reason to think that this situation is changing, and I hope the right hon. Gentleman will indicate what is the policy of Her Majesty's present advisers in regard to trade with China if, as we hope, some easement of existing political tensions is achieved at the conference in Geneva next month.
Having said that and having invited from the Government a clear statement on policy, I propose in the main to direct my remarks to the question of trade with Russia and the Communist countries in Eastern Europe. As to that problem, it always seems to me that there is a danger of over-simplification. There are two risks to be avoided in approaching the matter. The first is the risk of exaggerating the economic importance of this matter. It is not insignificant, but it is not to be expected that trade with the Communist countries is going to get us out of the economic mess into which the misguided policy of Her Majesty's Government in other directions is tending to lead us.
The other danger which faces a discussion of this question is to under-estimate the very hopeful political implications of a possible increase in trade with Eastern Europe. That is a matter which my hon. Friend the Member for Aston (Mr. Wyatt) introduced in a very clear way in his speech. For my part, I want to direct my observations to that aspect of the matter rather than to the purely economic results of increasing our trade with Russia, for it is my earnest conviction that our country should again try to take the lead and the initiative in world affairs, and that this is a matter in which perhaps we can help to take that lead.
The political implications of this problem are complicated and do not all tend one way. The most encouraging feature is the possibility that the development of trade relations may provide an increasing and greatly to be desired point of contact, co-operation and understanding between the free democracies on the one hand and the Communist countries on the other. There have been some encouraging implications at E.C.E. to which I want to refer.
It is a fact that the existence of the various embargoes on trade, however necessary some of them may be, is not only an inevitable source of irritation between ourselves and the Communist countries, but it is something which the Communist countries can and do exploit to their very great advantage in the cold war, exaggerating the importance of East-West trade out of all proportion to its economic reality. The truth is that in the actual ideological war, which may be more important now than the risk of a hot war, these embargoes form a very powerful weapon which is being effectively used against us.
On the other hand, there is another matter which has been mentioned by one or two Members on both sides of the House, the fact that our attitude towards this problem and our desire to expand trade with the Communist countries is a source of misunderstanding between ourselves and less informed opinion in the United States of America. I should like to say something on all these matters, and perhaps I should make reference first to the last one, so as to get it out of the way. It raises a difficulty which is not insuperable, and in regard to which, if only we did not pursue a penny-wise and a dollar foolish policy in presenting our view to the American people, we should be able to carry American opinion with us.
The fact is that the popular American approach to matters of foreign policy is inevitably rather different to ours. There they are a vast wealthy country, economically self-sufficient and independent. Foreign trade for the Americans is a mere overspill of their own internal surplus, and foreign policy for them is primarily a matter of defence against attack. Foreign policy for us is inevitably a matter of our daily bread.
They should understand more fully than the man in the American street yet does that if in this country our standards of living are to be maintained and, as we hope, improved, depending as we do on the importation of half the food we eat we must constantly be expanding our trading relations with other countries, and our constant preoccupation in foreign policy must be to find a modus vivendi with the rest of the world.
The great granaries of Europe, not so full now it is true as they used to be, are in the East, and in the East also are great sources of timber and wood pulp supplies so necessary to our industrial activity. The more difficult it is for us, because of import restrictions in other countries on the other side of the Atlantic, to develop our export trade to the dollar world, the more necessary it is to expand our trade in other directions. I want to ask the Minister, therefore, whether he does not think that the excellent work which the British Information Services are doing in informing American opinion could not be made even more usefully educational if a little more money were allowed to be spent upon it?
I turn from that to the more positive side of the political picture. We have to proceed on the basis of some sort of assessment of the probabilities in the foreseeable future. I am one of those who think that a hot war, a military war, is now less likely. I do not mean that we must not remain militarily strong. But the dangers are not so great as at one time they manifestly were. Meanwhile the cold war, the ideological war, less dramatic but not perhaps in the long run less dangerous, goes on.
But there are perhaps some signs now of a reorientation of Soviet policy, and I shall refer to some in this field. It is just possible—I do not put it higher than that—that the explanation of them is a simple one, that the Russians under their new administration are beginning to realise that their previous policies were not doing them a great deal of good. If that were so, it would still be difficult for them to make sudden and dramatic changes and concessions on the political side. Certainly there is little prospect at the moment of an overall political settlement, although the Far Eastern Conference in Geneva next month may remove some difficulties.
But the obvious difficulties in the way of an overall settlement seem to me to make it all the more important for us to seek agreement on ad hoc matters and to co-operate where we can. It is perhaps by gradually building up functional contacts and understandings that we can best promote the easement of existing tensions, and lead to political settlement in a larger field. Sometimes it may be in questions of medical research, sometimes it may be in other scientific or technical problems. Here at the moment, in the field of trade, there appears to be at least some prospect of increasing trading contacts and so moving towards, a more normal and a freer relationship.
I said I wanted to say something about the Geneva meeting of the Economic Commission for Europe. My information about it, I believe reliable and up to date, suggests on the whole that there has been a very interesting and encouraging atmosphere there. The Russians have marked the importance they attach to the conference by sending, I think for the first time, a Vice-Minister and experts of a very high level indeed. They have agreed to be represented—a thing that they have never done before—on the various technical committees.
It is an interesting, but perhaps not a very important political fact, that the United Kingdom and Soviet delegations have joined in the resolution, to which the President of the Board of Trade referred, paving the way for the reconstitution of the committee on the development of trade. I do not attach too much importance to the establishment of committees, but what is more significant is that the Communists have agreed to participate with the free European countries—the United States sitting in as an observer—in the trade consultation meeting which is to take place at Geneva next month.
That is a very real, important practical exercise in international negotiation and co-operation. From experience last year it looks as if fruitful results may be obtained from it. It is a practical procedure, something that takes place in private, and it is not bedevilled by propaganda. There will be very complicated problems to be discussed there in the multilateral stage, but there are indications that at the bilateral stage the Russians may mean business. We must not be less ready to do business than they are.
That does not involve doing away with all the embargoes on strategic exports. Nobody suggests that. It would be clearly impossible. I remember far too well what I thought and said in the late 1930s when big business concerns were sending arms to Germany, Italy and Japan to favour anything of that kind now. Nobody on this side of the House wants to send guns, aeroplanes or battleships to potential enemies. But this list of embargoed goods has become a very long, complicated and confused one. One has to make an empirical approach to it.
In the period from 1949 to 1951, when the skies were darkening, one had to go on adding to it. Now that there appears to be some ray of light one can start a process in the opposite direction. We ask to have it made quite clear by the Minister of State, Board of Trade, that that is the policy of Her Majesty's Government and that the list will be kept under very careful review in consultation with our friends and through the appropriate committee with a view to steadily reducing it so that in due time there are left on it only things which are obviously and manifestly of direct strategic importance.
Another of the difficulties in developing trade with the Communist countries is that whilst we here are engaged on a process which hon. Members opposite call "liberalising" trade and leaving matters to individual importers and exporters to arrange, the Communist countries act through State agencies. In these days, when in the case of Russia so much must inevitably proceed on a bilateral basis, it seems to me most important that our trading activities should be both promoted and co-ordinated through some more or less official agency. It would be clearly a bad thing that trade with the Communist countries should be promoted, or still more should be channelled through some unofficial organisation such as has been mentioned, which is at least open to the attack that it is politically tendentious.
I will not go so far as my hon. Friend the Member for Stechford (Mr. Roy Jenkins) in suggesting that we ought to set up something analogous to the Dollar Exports Board, although that was an interesting and important suggestion. I should have thought that that matter should be handled departmentally in the Board of Trade, but in view of the special features of trade relations with the Communist countries I would have suggested that much more official guidance and co-ordination and support was necessary in this field of our trading relations than was at present being given. It may be that there should be some sort of consortium of exporters and importers under official chairmanship, designed to promote some security of markets and to co-ordinate what is being done.
Another problem is that of payments. Trade agreements are likely to be bilateral, but, possibly, some system of multilateral payments could be devised, possibly through the extension of E.P.U. on the Eastern European side. These are all matters that will have to be discussed, and the fact that they can now be discussed, quietly and in a reasonably objective way, is not a discouraging feature in the present state of world affairs. Perhaps it is a straw in the wind.
I pass now to some quite short observations in the economic aspects of all this. But for one matter, which is somewhat speculative still in the future, I would not pretend that this trade is likely to be of very great economic importance in the future or to go very far in solving our economic difficulties. The right hon. Gentleman made some reference to and entered some caveat regarding pre-war figures of trade. My recollection is that our trade in pre-war days with what are now the Communist countries of Europe—that is to say, with Russia and the present satellite countries—represented something under 7 per cent of our exports, including quite a large proportion of re-exports, and something just over 6 per cent, of our imports.
What I would say about that is that, in these days, even a market which represents and is going to take only 7 per cent, of our exports is by no means a market to be sneered at. I know that the figures are not anything like that level at the present time. Whether they could be brought back to that level and whether they might even be increased beyond it is a matter of speculation. But there is no harm in making an earnest effort to get them back.
It is true, as hon. Members on this side of the House have pointed out, that there are some considerations which tend against the possibility of increasing our volume of trade. The whole course of policy in the economic development of the Communist countries has been towards making those countries economically independent, and it is said, and there is some force in it, that to some extent at all events, that policy—a not unnatural one—may have been encouraged by ourselves.
On the other hand, it does seem possible now that it is the intention of Russian policy to improve internal living standards and to increase consumption. That may be a tendency helping towards a liberalisation of trading policy and tending to result in an increase in our potential trading relations with them in consumer goods and other things. There is, on the other hand, the fact that, while Russia is in a position to pay gold for a time—and very useful it is for us to have gold—it seems that at present she has very little else to export to us.
Grain production, for instance, in comparison to the increase in the population, has gone significantly down. But this lack of potential exports to us may be—I say no more than that—in part due to transitional reasons connected with the changing social and economic situation inside the Communist countries, and, on the whole, I would say that we might reasonably hope to restore trade at least to the pre-war figures of 7 and 6 per cent, respectively, and, possibly, to increase it significantly beyond that level.
But, that said, we should, of course, mislead ourselves gravely if we thought that for us or for most of the European countries—Germany is perhaps in a very different position—this trade would be the solution to our present economic difficulties; or that it will protect us from some of the economic dangers which lie ahead. It is an important market. It is a market which, even if it never got back beyond the 7 per cent, on the export side, would be very well worth while encouraging. But it is not one which anybody pretends will be the most important market for our exports.
I have said that I think the real importance of this matter is not simply the economic, which may not in itself be very great. The real importance of this matter—and I end as I began—is that there is apparently some dichotomy between Russia's political policy and her trading policy. That appears to be the present development. The underlying cause of it may be—one does not know—merely a change of tactics. But it may be that the underlying cause is some diminution of Russian confidence in the policy of the cold war as hitherto pursued.
With all the great resources of nature, with all the enormous resources of modern industry, with all these tremendous, terrifying, but marvellous inventions of modern science, we can of course, if we all want, move towards an era of international co-operation which would bring untold benefit and prosperity to the whole of the world. If we do not, as we very easily may, destroy ourselves in the meantime, it is just possible that at some time all of us, in this country, in Russia, in China and in all the other countries of the world, may realise that we have these possibilities within our grasp. At any rate, we must not miss any possible step forward in that direction. I believe that in the improvement of our trading relations lies a point of contact which may enable us to take one small step in the right direction.
9.38 p.m.
This debate has demonstrated the great interest rightly taken by this House in this important subject. It has also demonstrated the remarkable measure of agreement between us. The hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) said that he agreed with everything which has been said this evening—
Almost everything.
I was about to say that I would go a very long way with the hon. Member, perhaps not the whole way, but I know that he has a much broader mind than I have.
We should congratulate my hon. and gallant Friend the Member for Arundel and Shoreham (Captain Kerby) on his maiden speech. He spoke with such great assurance and fluency that by contrast, I shall show up badly during the next quarter of an hour.
We all agree that East-West trade has been running at a deplorably low level during the past few years. The climate is now more favourable, and if that is so it is surely right that we should seize our opportunity in the hope that our efforts will lead to a steady and further improvement. I believe that we can regard the outlook with some hope and confidence. I should like to assure the House once more at the outset that we are alert and anxious to make the very most of the improved situation.
One sometimes hears the argument that the ideological differences between us and those on the other side of the Iron Curtain are so deep and the strategic dangers so considerable that, bearing in mind that commerce should be advantageous to both parties, we ought not to countenance any trade lest it might result in a strengthening of the economies of the Communist countries. That is an argument, but it is not one which is accepted by Her Majesty's Government. Nor do we think that it is-accepted by the other countries which are co-operating with us.
We have made it clear that we are entirely in favour of an expansion in trade in non-strategic goods. We do not give any grudging acceptance to that principle. I have heard some people, not in the House of Commons, talk about trade across the Iron Curtain as if it were something that might just be worth while, but only just. It is rather like the story of the barrel of cider which the farmer gave his workers. He asked them what they thought of it, and they all replied, "Just all right." The farmer said, "What do you mean by ' Just all right'?" and the workers replied, "If it had been any better we should not have got it, and if it had been any worse we could not have drunk it." That is very far from the view of the Government. We believe that the kind of trade which now looks as if it will become possible is sound trade, and that we ought to promote it as actively as we can.
I have been asked how the line in respect of strategic controls has been drawn. Hon. Members will know that our present list of goods subject to strategic embargo in the case of the Soviet bloc have been drawn up gradually over a long period of years by means of endless consultations between the 14 or 15 countries concerned. It is a most difficult matter, as we have all agreed this evening, to decide what is a machine which is primarily of strategic value and what is not and, therefore, the list is a complicated one. It is easy for us or any other country to say that if we or the individual country concerned had drawn up the list, it would have been drawn up rather differently.
I will not say any more about it at this stage, though I shall come to some details a little later, because I cannot usefully add anything to the very comprehensive statement of the Prime Minister when he said so clearly that a substantial relaxation of the present restrictions would be beneficial. As my right hon. Friend said this afternoon, consultations have already started, and I can assure hon. Members that we are taking prompt action and will do our best to ensure that no avoidable delays take place.
Some hon. Gentlemen have hinted that we should act unilaterally in this matter. We are nearly always pressed, and rightly pressed, by hon. Members opposite to follow a policy of more co-operation in these matters. I cannot think of a case where, if every country acted unilaterally, there was more likelihood of chaos resulting than would be the case in this matter. I am sure that it is an instance in which co-operation is absolutely essential.
I want now to say a word about the volume of trade which is taking place between Russia and ourselves. As my right hon. Friend said, the figures of our imports from Russia were £60 million in 1951 and £58 million in 1952, and then they dropped to £40 million in 1953. Russian purchases have been very small indeed, running only to £3 million or £4 million a year. But, as the House will know, the bulk of Russian purchases are raw materials—wool, cotton, cocoa, tea and other commodities.
Not cotton.
The right hon. Gentleman says not cotton.
They export it.
But in any case Russia has had an adverse balance recently.
I have been asked about the chances of increasing our purchases from Russia. The main imports in which we are interested are grain, timber, metals and manganese ore. As hon. Gentlemen will know, our market is wide open for those commodities at present. It is difficult to make a quantitative estimate of prospective imports; but the Russians made it clear to us recently that they realised that it would be an essential part of the arrangements, so to speak, that they should do their utmost to increase and vigorously pursue their export trade. It would be very helpful, for instance, if larger quantities of grain could be made available, because that is, I think, one of the most hopeful of Russian exports.
I will now say a word or two about the orders recently collected in Moscow by our visiting business men. As my right hon. Friend said, £12½ million worth of orders were firm orders, and of those it has been so far found possible to licence £6½ millions worth. In addition, there is another £6 million for trawlers and another £1¼ million for textile machinery. There are, therefore, firm orders worth £13¾ million which can, as it were, be put in hand straight away.
My right hon. Friend and I had discussions with those business men on their return. They told us that, in general, they were extremely satisfied at the way in which the business negotiations took place. They found that they were dealing with extremely competent men who knew their jobs technically and administratively, and that negotiations proceeded very much on what one might call the normal business lines with tough bargaining. That is good news.
We were also interested to learn from them how keen the Russians were to do business with us. They remembered the machinery that they bought from this country between the wars and were very anxious to order the same makes of machinery as they had then—sometimes the same types of machinery—because they said it had served them so well. It is a pleasing instance of British quality having proved its worth. As the hon. Member for Stoke-on-Trent, South has said, no effort on our part to maintain quality is ever wasted.
Mr. Kabanov estimated the total volume of trade at £350 million to £400 million over three years, nearly half of which would be, so far as can at present be seen outside the present strategic embargo. Mainly capital goods are involved. There is an unspecified amount of consumer goods, so it is rather difficult for us to say what those consumer goods represent, but the Russians have not expressed any immediate interest in importing consumer goods; it is mainly capital goods they want. In regard to the trade which is now being booked we, with the Export Credits Guarantee Department, will adopt as helpful an attitude as we can.
We are just as anxious to expand trade with the other countries in the Soviet bloc as with Russia itself. Negotiations with Poland have now been going on for some little time, and we hope that they will terminate successfully. When Mr. Sanders was released from Hungary last year the ban which we had imposed on Hungarian exports was lifted, and we hope that trade talks with that country will start in the course of a few days. Business with Hungary has been running at a very low level indeed. With Czechoslovakia, trade is rather lower than last year. We hope that trade talks with that country will start in two or three months' time. We on our side are following matters up as actively as we can.
I should like to turn to the subject of current trade with China. To give an idea of the size of our trade, in 1951 our imports from China were £7·75 million; in 1952, it had dropped to £3 million, but in 1953 it was £10·3 million.
Has the right hon. Gentleman got the 1950 figure?
In 1950 it was £10 million, so that last year it returned to the 1950 figure. But our exports are at a very low figure indeed. It is very difficult to say what are the chances of increasing that figure of our purchases from China.
Looking at the goods that we have found it advantageous to buy from China, one is not too hopeful that that volume is likely to rise very rapidly. It may be that some system of freer trade may help us there. At present if China placed large orders for capital goods with us, one cannot see how that business is to be financed from the point of view of China and how payment is to be made. The commodities that we have been buying are eggs, tung oil, seeds and nuts, bristles and raw hair.
I turn to a question which several hon. Members have asked—why do we not relax our strategic embargo restrictions on China as readily as we are hoping it may be possible to relax them in the case of the Soviet bloc? I would say, to start with, that Her Majesty's Government are very anxious indeed that we should resume as soon as possible friendly trading relations with China. This country, over a very long period, has had friendly and understanding relations with the Chinese people, and we have always got on very well indeed with them.
But the position is not so at present. Our policy as regards our strategic restrictions on exports has been—and it is, too, the policy of the other countries who are co-operating with us—that we felt that the first thing required was an armistice, and that, after that, there should be progress towards some peaceful political settlement, and then a review of the strategic controls. Fortunately, next month there is to be the Geneva Conference. We all hope that that will be successful and that it will report definite progress towards a peace settlement. If it does, that is exactly the kind of progress which will bring nearer the day when we shall feel it right to recommend a review of the strategic controls on China, in the same way as we feel that the time has come when that can be done with the Russian bloc.
My hon. Friends the Members for Holland with Boston (Sir H. Butcher) and for Cheadle (Mr. Shepherd) referred to the unhelpful attitude of the Chinese authorities to our representative in Peking and to our established business houses. That is a fact. They really have not been helpful—to put it mildly—and that in itself creates a very awkward obstacle. We must remember that our present policy as regards strategic controls on China is based on the United Nations resolution of May, 1951, and that things have not yet really fundamentally changed for the better sufficiently to justify, in our opinion, a fresh attitude on this point. Let us hope that the day will soon come when it will be possible to adopt a different attitude.
Would the right hon. Member agree that the Chinese were then fighting in Korea against the Commonwealth Division, whereas, since the armistice, the military situation has completely changed? Has not that altered the position sufficiently to justify streamlining the restrictions? Secondly, can the right hon. Gentleman tell the House to what extent strategic quantitative controls of sterling area materials—rubber, tin, and the rest—are still in force in our trade with China?
I agree with the right hon. Gentleman that the armistice has changed the situation, but I was trying to make the point that, in our opinion, the important factor is progress towards a peace settlement. When that becomes a fact a new attitude will be justified.
What about Indo-China?
There has been a change in the situation, but not sufficient to warrant doing what the right hon. Gentleman suggests.
He also asked about the strategic controls on sterling area raw materials. Those controls are exactly the same and as comprehensive as they were before. The only relaxations have been the ones announced in the last few months, in pharmaceuticals and small motor cars.
I want to refer to a few questions which have been asked by various hon. Members. The hon. Member for Aston (Mr. Wyatt), my hon. Friend the Member for Skipton (Mr. Drayson) and the hon. Member for Stoke-on-Trent, South asked what information we had given to the businessmen who went to Moscow. The hon. Member for Aston understood that they could not find out from us whether their products were on the embargo list. The answer is that most of those gentlemen came to see us before they went to Moscow, and to those we gave the fullest information we could on the question of whether they could accept orders for their products.
There are several difficulties. Part of the goods on the list are only quantitatively embargoed, and whether or not orders can be placed for them depends on the size of the orders. Secondly, the list is a very complicated one, and it is extremely difficult to say, until one knows exactly the specifications of the machinery or whatever it is which is ordered, whether it falls inside or outside the list. We gave the best information we could, but in many cases the businessmen did not know what specifications were required until they entered into the negotiations, and it was only when they brought back their inquiries that we could give them the necessary information. In some cases we had to consult our friends in Paris before we could give a firm reply.
Is it now the policy of the Board of Trade to simplify the matter as far as possible? The question of delivery dates is very important, because unless delivery dates are kept confidence is undermined.
I could not agree more about the importance of sticking to delivery dates. I have been in business myself, and that is one lesson which has been burned into my soul. We shall do everything we possibly can in that direction.
The hon. Member for Aston did not think that we were following the right methods in our contacts with businessmen, and said that we must keep open and flexible minds and attune our ideas to those of the people with whom we are doing business. All I can say is that we believe that the more direct the contacts can be, the better. We like businessmen to go to Moscow and establish personal contacts with the people dealing with the products in which they are interested.
Would the right hon. Gentleman care to express an opinion about the possible adverse effects of the closing down at the present moment of the commercial and trade secretariat of the British Embassy at Moscow? Would not such a department assist the further development of trade talks and contacts?
That is, I think, a very relevant and constructive suggestion.
The department, I understand, closed down because it could not function in the difficult circumstances, but that is exactly the kind of question which we are considering at present. I think it is rather encouraging that M. Kumykin, at the E.C.E. Conference the other day, said he welcomed the meeting of the businessmen in Moscow and paid a tribute to the success of it.
The hon. Member for Leeds, West (Mr. Pannell) expressed the anxiety of the workers in the machine tool industry about East-West trade. We entirely understand and sympathise with it. He mentioned the difficulties of deciding whether a machine tool was strategic or was not. That is the essence of the difficulties of the problem. The other day I was going round some factories in Birmingham and saw some of the most modern machine tools. It looked to me as though each one would make every single thing in the world I could think of. I think one could make a short list of the things they could not make. That is precisely what makes this matter very difficult indeed. We shall await with interest the return of our machine tool manufacturers who are now in Russia. They should be back very soon, I think.
The hon. Member also talked about locomotives, and said he understood that the Russians were very interested in placing large orders for locomotives. Locomotives are not on the Russian Minister's list of things in the import of which from this country Russia is particularly interested.
My hon. Friend the Member for Altrincham and Sale (Mr. Erroll) raised the question of B.C.P.I.T. I do not think it is necessary for me to say again why we did not think B.C.P.I.T. was the best channel for trade, or that the information we had was that that body was really more interested in the dissemination of political propaganda—[HON. MEMBERS: "Nonsense."]—than in furthering genuine trade.
Would the right hon. Gentleman say where he got that information, because it is absolutely contrary to the experience of everybody who has had anything to do with it whatsoever?
I think we have very good sources—
What are they?
—and good reasons for reaching that decision. We need not do much more than look at several of the members of that body—
Who?
I do not think myself that people, looking at the matter objectively, would quarrel with our decision. Perhaps I shall calm the hon. Gentleman if I put it this way: we felt it would be possible to find better and more appropriate channels for the transmission of genuine trade.
I would not disagree for a moment that it is possible to find other appropriate channels outside Government circles, and I mentioned the British-Russian Chamber of Commerce, but I hope that the right hon. Gentleman will not leave the House with the idea that some of these very distinguished gentlemen, members of the British Council for the Promotion of International Trade, are Communists or Communist stooges, when they include two or three Members of both Houses of Parliament, some of the most distinguished academic economists in the country, including the professors of economics at Cambridge, Glasgow and one or two other universities, and when they include one or two trade experts who have held high positions in the Board of Trade or been employed on special jobs for the Foreign Office. I hope that the right hon. Gentleman will not suggest that they are Communists or Communist stooges.
I was careful to limit my remarks to one or two members and not to the membership generally.
rose —
I have been interrupted a good deal, and there are still three or four speeches to which I must refer, so perhaps I may be excused for not giving way again.
My hon. Friend the Member for Altrincham and Sale implied that the Government had been slow to react to the new situation and that we should have reached our present attitude a long time ago. I would remind him that the attitude of the Soviet bloc towards the import of capital goods and, as they now say, consumer goods, is a new one. Their attitude a year ago was completely different. I do not think we can be blamed because our attitude a year or so ago was different from the present attitude.
My hon. Friend mentioned alleged contraventions of the agreement, and of goods finding their way behind the Iron Curtain in spite of the present regulations. I can only repeat what my right hon. Friend had said on several occasions: if anyone has any definite evidence—and nothing less than definite evidence is any good if we are to follow it up—we should be grateful if it were passed on to us. We should then take the matter up. Where we have had definite evidence we have taken the matter up most vigorously. I agree with my hon. Friend that a greater interchange of technical people and more frequent technical discussions must be helpful. The hon. Member for Islington, North (Mr. Fienburgh) said he thought that not too much attention should be paid to pre-war figures, and I agree. The situation today is quite different. The new arrangements announced by the Chancellor of the Exchequer a day or two ago, broadening the area of transferable sterling may be helpful to East-West trade in the long run.
My hon. Friend the Member for Bury and Radcliffe (Sir W. Fletcher) seemed to ask whether the Consultative Group was working, and in a way I have dealt with that point. We must have patience; if we had not something like the Consultative Group, which the last Government thought it was right to set up, we should have to create some body of the same kind to deal with the situation.
My right hon. Friend has not represented my argument quite fairly. I asked, "Is it working in its present form?" I pressed on my right hon. Friend certain definite reforms which should be undertaken immediately.
I thought that my hon. Friend implied that the Consultative Group was an autonomous body. He referred to it as "governing and taking decisions," but I am sure he will recall that it is only an advisory body, and that the decisions have to be taken by the Governments themselves. There have been variations in the strategic lists between one country and another, but today all countries forming the Consultative Group are practically in line, and certainly far more in line than has ever been the case before.
The hon. Member for Bridgeton (Mr. Carmichael) spoke of ships. The mere fact that a merchant ship may be of 10,000 tons is not in itself a disqualification. There are several types of ships which are now approved. Inquiries and discussions are going on about a further order for trawlers which I hope may develop. My hon. Friend the Member for Skipton implied that the businessmen coming home were disappointed with the Government's attitude, but when we had a meeting with them we did not get that impression at all.
My hon. Friend raised an important point about whether visas were being refused by the United States to businessmen because they had been to Moscow. So far as my information goes, no visas have been refused. A number of these gentlemen have wanted to go to the United States. Most of those who have wanted to go have had their visas immediately, but in one or two cases there have been delays, and that we have taken up with the United States' authorities. We have no reason to think that there will be any difficulty over that matter in the future.
I agree with many of the things which the hon. Member for Stetchford (Mr. Roy Jenkins) has said. I agree with him that we welcome the diminution in propaganda from the Soviet bloc. He raised the question of whether some sort of organisation would be required at this end, and that is some thing upon which we must keep an absolutely open mind. We do not know. It may be that something will be required. If so, I do not think that there should be any difficulty. It may be that industry itself will find some kind of body which will help. We must watch the situation and not be stopped from doing what is necessary by any doctrinaire views either way. I do not know what will be required in the future, but I feel myself that if there is good will there will not be any insuperable difficulties in producing the right mechanism.
The hon. Member also asked me what the Soviet Foreign Minister's list of £350 million or £400 million really represented. I think that the best answer I can give is that we understand that it is the list of goods that Russia needs, and that Russia believes that if the right arrangements were made, the United Kingdom should be able to provide her with them, because she would like to buy from the United Kingdom. The implication is that if the right arrangements are not made and our conditions are not right from the point of view of Russia, she will go somewhere else to get them.
The hon. Member for Stoke-on-Trent, South made a robust and vigorous approach on this matter. He said that we in this country have the finest assets and the finest scientists and engineers in the world. I quite agree, and I would go further and say that we have also the finest and steadiest manpower in the world. If we cannot make something of these assets it is our own fault.
The right hon. and learned Member for St. Helens (Sir H. Shawcross) mentioned the information services in the United States. I agree that they are doing a very good job, and we must support them. He also raised the question of organisation, which I have already dealt with.
May I say, in conclusion, that we have had a most useful and good-tempered debate. I hope that I have made it clear that Her Majesty's Government are really anxious to see this trade increase. There are differences between us as to the best means of bringing that about. One of the worst things about the cold war are these iron curtains, and I believe that the good which will come from increasing our trade will be much more than the purely short-term, material advantages of getting a bigger volume of export trade. There will be the good will which will come from re-establishing personal contact between the ordinary people in the countries concerned.
I think that our experience of life is that if one knows somebody, one may have a disagreement but one is not likely to have misunderstanding. I think that the people of Britain are anxious to make sure that there are no possibilities of misunderstanding. I believe that, particularly now, with good will on both sides through the development of that humdrum human activity of trade, we stand more chance of bringing some measure of relief to a frustrated and distracted world. This extra trade through the Iron Curtain is no panacea. There are no short cuts.
Her Majesty's Government want to play a positive part in this business. There are some aspects in which we can take action within our own power of decision. There are other aspects in which we can take action only after consultation with the other friendly countries concerned; but no time will be lost in either case. So, in the words of Robert Louis Stevenson, let us "travel hopefully" and, I should add, energetically and resolutely, along a road which may lead to better things.
Question put, and agreed to.
Bill accordingly read a Second time.
Committed to a Committee of the whole House.
Committee Tomorrow.
Aircraft Crash, Sicily
Motion made, and Question proposed, "That this House do now adjourn."—[ Mr. Studholme. ]
10.15 p.m.
On 19th November last the House had an Adjournment debate on the subject of the crash of the Hermes aircraft off Sicily in August, 1952. In the course of that debate I warned the Joint Parliamentary Secretary that it might be necessary to raise the subject of this crash again. Tonight it is my intention, having read certain documents that were not available to me at that time, to press the Government once more on this question.
Briefly, my contention is that this crash, in which four babies under the age of five, an air hostess and two women were killed, need never have occurred; that the Government's handling of the inquiry was totally unsatisfactory, that they have, quite wrongly, decided to conceal the report which was made available by the Italian Government, that they have taken quite inadequate remedies to deal with the causes of the crash, that as a result the safety of British aircraft has been imperilled and that all this amounts, as I hope to show, to something in the nature of a public scandal.
I hope that the Joint Parliamentary Secretary will correct me if I am wrong at any stage in the story which I tell, but I am anxious to put on record the way in which the Government have dealt with this crash. The first point that immediately comes to mind—it became obvious only after the last debate—was that when the inquiry was held by the Italian Government, the British Government did nothing as far as one could make out to see that the Commission of Inquiry received representations by all interested parties. It is extraordinary to read the statement by the company—Airwork— that it was not able to make representations on its own behalf to the Italian Government in the course of the inquiry. My first charge against the Government is that they failed to help the operators or survivors adequately to represent their views at that inquiry.
The report was not completed for a further year, and when it was made available last August, the Government decided not to publish it. They had three alternatives before them. They could have published the report if they wanted to, but they decided not to do so because, they said, it was unfair. At the same time, it was open to the Government to hold their own inquiry, which, one would have thought, would be the obvious thing to do if the report was unfair. To the contrary, the Government decided to accept the report, although they said that it was not compiled in accordance with the traditions of British justice. The report was sent in confidence to the survivors and in confidence to myself, because I had taken an interest in the matter. I should also like to put on record that had I fallen into what I now firmly believe to have been the trap which was laid for me, and had I read the report, which I did not do—I returned it to the Minister—I would have been unable to bring these facts to the attention of the House.
Following the receipt of the report by the survivors I had a flood of letters, in almost all of which great tribute was paid to the courage and skill of the captain in ditching the aircraft. No criticism was made of him or of the members of the crew as individuals, but throughout all the correspondence was the constantly repeated theme that the report revealed so many failures on the part of the company and the crew in the safety regulations that it ought to be published.
At any rate, on 19th November last year it was possible to get a debate on the subject. The Joint Parliamentary Secretary had kindly provided me, not of course with a copy of the report which I could read out, but with a list of the remedies which the Government themselves had taken after they had read the report. As we were at the mercy of the Parliamentary Secretary, we were obliged to take his word for it when he said:
I wrote to all the survivors and asked them to authorise me to get from the Ministry the replies to the questionnaires they themselves had filled in. All the survivors had been sent questionnaires for completion after the crash, and had returned them to the Ministry. I got 30 authorisations from the survivors to get these questionnaires from the Ministry. They were the replies compiled by the people in the crash and sent to the Minister. But the Minister told me that the questionnaires were included in the report, which was a confidential document, and that therefore the questionnaires were confidential also. In other words, the survivors could not have back the information which they themselves had sent because that information was included in a report that was described as confidential. That seemed to me then—and I see no reason to change my opinion now—to be a deliberate attempt to prevent this inquiry from being carried a stage further.
The position reached was one of stalemate. There was nothing more which could be done about it. But to my surprise, and, no doubt, to the Government's surprise, about a month ago the International Convention on Civil Aviation published an Aircraft Accident digest which included a summary of this report which had not been published in this country. This has enabled us to reopen the whole question in the light of the information, inadequate though it is, which has come from I.C.A.O. in Montreal.
The first point to which I want to draw the attention of the House is those words of the Parliamentary Secretary, when he assured the House that there was no failure by the company or the crew to carry out the existing regulations, because that is not really borne out by the information provided by the report itself. Very briefly I will go over some of the points that have emerged from the report and from the letters from survivors. The first point is that the company failed to provide a floatation device for every passenger. Miss French, the Air hostess, died because she could not find her life-jacket, and that was a failure by the company. I challenge the Parliamentary Secretary to say that that was not a fault of the company in not abiding by the regulations.
Secondly, the crew had not been trained in emergency regulations, because they were in their cabin and they did not send adequate information back to the air hostesses to instruct the passengers. The emergency safety regulations were not abided by, and I challenge the Parliamentary Secretary now to justify the point that he made in his last contribution to the House on this subject. The third thing is that the passengers were not instructed in emergency drill as all safety regulations provide. The proof of this is the fact that many passengers could not find their life-jackets and could not put them on. The air hostesses could not instruct them at the time when the aircraft was nearing its ditching. That was a failure by the company to abide by the air safety regulations.
Finally—and this is the really serious charge that one lays against the company—it is perfectly clear that there was no dinghy carried on board and because there was no dinghy, these five babies died. A photostat of the flight plan, which I have not seen, makes it clear that no dinghy was on the aircraft, and the captain had already deleted that item from the flight plan, as was revealed at the inquiry later. If this is really so, it proves beyond question that the company had failed to abide by the safety regulations laid down by the International Convention, and it disposes of that part of this speech of the Parliamentary Secretary in defence of the company for this accident.
The second point with which I must deal are the failures of the crew, not because I have anything against the crew, but because the benefit of these inquiries is to draw attention to human failures and failures in instruction and drill so that these things can be avoided in the future. The first of these failures that emerges from the report is that the water methanol injection system in one of the engines was not serviceable at the takeoff, although a certificate of air-worthiness had been signed. This was a failure of the company and the engineer to abide by the safety regulations.
Further, the automatic pilot which, though not of vital importance in this crash, was found unserviceable shortly after take-off. Then a generator which operated off one of the engines was unserviceable within an hour of take-off, and if the captain had obeyed safety regulations he would have turned back to England. Then the battery was defec- tive. This was a crucial safety point because, once the generator had gone, there was only one minute of juice left in the battery with which the emergency signals could be sent off, and if rescue vessels had been there earlier there might have been fewer casualties. Again the flight engineer made a human error, which is not of importance in itself at this stage, except that it was dealt with in the report. Finally, engine modifications, which had been found necessary after previous crashes by Hermes aircraft, of which there had been three in the previous year, had not been carried out on this aircraft.
In the light of the technical details I have given, it passes my understanding how the Joint Parliamentary Secretary could assure the House categorically that there was no evidence that the company or crew had failed to obey safety regulations. However, I will leave that because it is past and no one wants to judge an aircrew in a moment of crisis, and I am the last to do that.
indicated dissent.
I have only done it in so far as it is necessary for the record.
The hon. Gentleman must not be two-faced about this. What he has said he did not want to do, he has done. He has tried to show up the British crew as being inefficient, almost to the point of being criminally inefficient, and to say now that he does not want to do it, when he has just done that which can only do harm, is being hypocritical to the worst degree.
The intervention of the hon. Gentleman is not of great value, because the point I am making is that the Joint Parliamentary Secretary was less than frank with the House when he assured us that none of those things was true. My only interest is that the remedial action should be adequate, and there is no point in my stressing the necessity for remedies if I have not pointed out failures by the company and crew. This is constantly done in reports, and if the report had been published everything I have said would have been found in black and white and I should not have had to raise the matter.
I come now to the question of remedies. The Parliamentary Secretary kindly sent me a list of these. He listed seven, and I have them in my hand. They deal with engines, with generators, with lighting, with life-jackets, with life-saving equipment, with drills and with briefing. Not having known at the time he sent me them what recommendations the Italian report made, I was unable to judge whether these were adequate. I ask the hon. Gentleman now to tell us how many of those promises of remedial action have been put into effect because, as I read them through again this evening, I notice they say that life-jackets will be improved, that they will try to do something about children, that they hope to examine the question of improved batteries, and so on. We want to know what actual progress has been made with those remedies.
Far more important—and this is the case for publishing the report, it now appears from the Aircraft Accident Digest that it was not seven recommendations they made covering each of these but 14, and had not this Accident Digest been published we should never have known about the other seven points made in the Italian report. What were they?
The first thing was that they should re-arrange the flight engineer's panel. My reason for mentioning his error earlier on was that, as the engine failed on this side, he should have pulled back the throttle on the other side, and the report says that in future the instinctive action of every engineer should correspond with what is on his panel. It is an important point because his error was a natural one and the Italian report recommends action on that. What has been done? The Government have made no mention of the flight engineer's panel.
Secondly, on the question of the certificate of airworthiness the Italian report made a point of great importance when we consider what the ground crew did in this case, but the Government have promised no remedy. Next, the Italian report recommended better maintenance. Why? Because in these cases the life-jackets were rusty and they could not get the C.0.2 bottle to break so that the jackets became inflated with air. The batteries, which provide a light for a man floating in the water, were rusty and out of action. The Italian report laid great stress on maintenance. There is nothing about that in the remedies which the Government have told us about.
The Italian report lays emphasis on the composition of the crew: that there should not be people in the crew without much experience of that type of aircraft and who have not had much training together. That would seem to hint, although we can only guess at it, that this crew had not had much training together. More important, the Italian report says that there should be a system of licences for air hostesses. It is a tragedy that these people died, in part, because the air hostesses themselves did not know where to find the safety apparatus. One paid the price of her life by unselfishly handing over her own apparatus and then could not find another. Indeed, as we have been talking of the crew, I would say that it is in their own interests that this report should be published.
The Italian report made two other recommendations, one about the provision of a raft for safety apparatus, and the other about how far an aircraft should fly over sea before rafts should be provided for everyone. These seven points would never have emerged had it not been for the I.C.A.O. publishing their Aircraft Accident Digest. The Government, whose word we have had to take, up to now have evidently prepared no remedies for them.
Why are we in this House interested in this matter? I know why I am interested. I happen to know one of the survivors, the pregnant girl who swam in the water for two hours with two small children to look after, and who was within three months of having her next baby. My only interest—and I am sure the Parliamentary Secretary will accept what I say—is that full publicity shall be given to this crash so that the same thing shall not happen again.
Finally, then, I charge the Government with neglect in not seeing that the inquiry was properly carried out. I feel that the company and the crew have some responsibility for the accident, and that the Government have taken inadequate remedies to deal with it. I believe that it is only in the blinding light of publicity that we shall establish safety in air travel. Not only because companies and crews are more susceptible to public opinion than anything else, but also because the travelling public wish to be certain that all steps are taken to see that these mistakes do not recur.
I would make one final appeal to the Parliamentary Secretary to publish the report. It is clear that all was not well with this aircraft, or with the safety regulations, or with the company or the crew. It is his simple duty to this House, and indeed to the whole cause of air safety, to make available this information so that we may judge for ourselves how adequately the Government have dealt with the matter.
10.33 p.m.
At the outset, I assure the hon. Member for Bristol, South-East (Mr. Benn) that in accordance with the undertaking given on 19th November last, when we discussed this matter for the first time, my right hon. Friend gave earnest consideration to this problem in the light of everthing that was said in that debate; but he decided that there was no reason for him to change his original decision, which was, I repeat, based on a strong question of principle.
The hon. Member is at a considerable advantage in being able to slash out with criticisms of the operating company on information based—as I know he will agree—on evidence only partially available to him. I must suffer a self-imposed denial in accordance with the decision of my right hon. Friend and myself not to publish the report. Therefore, it is impossible for me to take up each single criticism that he has made and try to refute it. I can understand that, at first sight, some might consider that the publication of the digest of the accident report in the I.C.A.O. summary has created a new situation, but I am satisfied that this has not been so.
A great deal of criticism of the crew was freely ventilated by the hon. Member and some of his colleagues when we debated the matter last, and it was not possible for me then to rebut all those criticisms without revealing the contents of the report itself. The fact that certain information about the accident was made public on that occasion was not, however, considered by my right hon. Friend to be an adequate reason for publishing the report. It follows, therefore, that further partial information—and I say "partial" advisedly—being published from another source does not in itself constitute a valid reason for the reversal of my right hon. Friend's former decision.
The hon. Member for Bristol, South-East raised some very important points. While my hon. Friend cannot reveal all the circumstances known to him, can he say in a general way whether, by accident or design, the hon. Member has committed a slander against the crew?
I think that if I proceed with the argument which I feel it is best to employ my hon. Friend will be satisfied and happy.
The I.C.A.O. report—this is very important—is a very much abbreviated document. The original report ran to 21 pages, and to it were added 55 appendices. Like all brief summaries, this one suffers from omission and compression. Furthermore, some of the findings are not entirely accurately stated. I want to make it quite clear that Her Majesty's Government had no hand in the publication of the extract, or in its disclosures, and cannot be regarded as associated in any way with the criticisms which were made.
It was on these criticisms that the hon. Gentleman laid the stress of the whole of his vitriolic attack. I must also emphasise again, quite categorically, that the original report in no way indicated that either the company or the crew had failed to carry out existing regulations. The original reason for withholding the publication of the report still stands, namely, that those who were criticised have not been given an opportunity of defending themselves.
The hon. Gentleman mentioned the matter of returning the questionnaires which had, I agree, been freely given by various people who had been party to the accident. When those questionnaires were collated by my Department they were sent to the Italian authorities. I ask the hon. Gentleman to accept the assurance—I see that he shakes his head, but I assure him of this—that they formed part of the report. Therefore, if we were not going to publish the report, it would have been quite impossible for me freely to give the answers to the questionnaires to the hon. Gentleman.
It was not that the people who sent in the questionnaires were asking for them for themselves. They wrote and asked through the hon. Gentleman that I should send the answers to him, and, therefore, in sending them to him I really had to make them confidential. I am sure that the House will understand that. Further, the fact that they were confidential did not preclude the people from getting back the answers to the questionnaires if they wanted them for their own personal satisfaction.
I must remind the hon. Member again—this is important—that the primary reasons for holding accident investigations when there are aircraft disasters are, first, to establish the cause of the accident, and, secondly, to enable my right hon. Friend to take any action which he may think necessary to ensure as far as possible that similar accidents do not occur again for the same reasons. I am quite satisfied that the Italian investigations achieved both of those aims, and I have assured the House that follow-up action has been taken on the findings of the report with which my right hon. Friend was in general agreement.
The hon. Gentleman made a point about whether action had been taken on all the findings by this time. I should not like to say offhand whether all the steps have been taken, but if they have not all been taken, they have all been taken but one, and one step is being taken at the present time. I know that hon. Gentlemen opposite who have great interest in civil aviation matters will realise that one cannot take remedial action in a few days. It takes some time to change some of these regulations. However, I ask the House to accept my assurance that my right hon. Friend has taken action on the findings and the recommendations of the report where he felt it was necessary to change any of the regulations.
Therefore, apart from the fundamental injustice of publishing the report, no useful purpose whatever in improving the safety of air transport would be served if we were to publish it. Indeed, I believe that the only purpose it would serve would be to satisfy the hon. Gentleman and some of his hon. Friends.
rose —
No, I am sorry, but there is so little time left, and there have been attacks that I must answer.
It is suggested that the report could be published with some sort of appendix to enable members of the crew to state their case, or as a memorandum to a published report. But this course is impracticable because the company would seek to rebut any criticisms in the report, as would members of the crew, and my right hon. Friend would be faced with a position in which he would certainly be asked to state his own opinions on the matter; and that is something which, so far, he has scrupulously avoided. Furthermore, this would only lead to the holding of an entirely new and independent investigation; a course which is administratively out of the question after so long a lapse of time.
I do not want there to be any doubt about the principles which govern the publication of accident reports. In the exercise of his responsibilities in this sphere, my right hon. Friend is simply following the practice of his predecessors. The undertaking to publish reports, contained in the statement made by Lord Nathan in another place in October, 1946, excluded, inter alia, reports on accidents to United Kingdom aircraft in foreign territory. This is clearly logical since it is important that the Minister should not fetter his discretion to accept or reject the report of a foreign authority.
The treatment of foreign reports in which persons had been held to be blameworthy without being given the opportunity of defending themselves, which they would have had under British procedure, was given careful consideration in 1949 in relation to a report by the French authorities on an accident to a B.O.A.C. Dakota. It was agreed that the principle underlying "Regulation 7 (5) action" should, as far as possible, be applied to reports of accidents made by foreign Governments.
Although we cannot impose the principle on foreign Governments, who are entitled to make investigations in accordance with their own laws, we can, nevertheless, apply that principle when we receive the report and decide whether it should be published. It was accordingly agreed at that time that, unless we were satisfied that the principle had been applied, there should be no publica- tion, and distribution of any such reports should only be made on a confidential basis to operators and other interested parties. I might add that there are at least five precedents for the action we have taken in this case, which arose during the term of office of the Labour Party.
To sum up, the investigation by the Italian Government has achieved the objects for which it was designed. My right hon. Friend's decision, which he is not prepared to alter, is made on the well-founded and previously followed principles of British justice. It would be impracticable and of no avail to reopen this matter. Sufficient publicity has already been given to this tragedy to assure the public and all concerned with it that neither the company nor the crew have committed any punishable offence and that, what is the most important, administrative action has been taken to see what the lessons learned as a result of this accident shall be applied to the avoidance, in so far as it is possible, of similar tragedies occurring in the future.
I can only hope that the hon. Gentleman, whose pertinacity in attack over this matter I hope I have treated with the sympathy and consideration which is warranted by his apparent desire to perform a public service, is now satisfied. But, if he persists further in pressing his claims I do not think it unreasonable if some should think that he was doing so for motives other than those which I most readily attribute to him. It is all very well, in pressing for the publication of this report, to pose as the brave defender of the weak; but in doing so, he is in danger of attacking an aircrew whose members have no chance to answer charges brought in evidence against them. Operators have the right to feel that they are protected by the Minister, and it is, in fact, my right hon. Friend who is defending the weak in this case and preventing the violation of all our ideas of elementary justice.
Question put, and agreed to.
Adjourned accordingly at a quarter to Eleven o'clock.