HC Deb 02 April 1936 vol 310 cc2199-227

5.58 p.m.

Mr. ALEXANDER

I beg to move, in page 5, line 38, to leave out "one million," and to insert "two hundred thousand."

May I say, Mr. Deputy Speaker, that I understood that, as the previous Amendment relating to Clause 3 has not been called, and as that is the important Clause with regard to reorganisation and amalgamation in the industry, it will be possible to have a general discussion on the Amendment which I have moved with regard to the future structure of the industry. We did not have the advantage until as late as Friday, after the Bill had left the Standing Committee, of having the Government's White Paper explaining the details of the agreement which has been arrived at in the industry for the future conduct of the dustry.

Mr. DEPUTY-SPEAKER

The arrangement come to with Mr. Speaker was that there should be a fairly general discussion on the Amendment, but the discussion should not go so far as to have the scope of a Second Reading discussion of the Bill. It means, however, that hon. Members will not be called to order by the Chair on the technical ground that they are referring to points which have been decided by Clause 3.

Mr. ALEXANDER

I am much obliged to you, Sir Dennis, and I hope that it will be for the convenience of the House and the Government. We shall thus be able to deal in a general discussion with the White Paper. We are moving to substitute £200,000 for £1,000,000 because, on the general financial condition of the industry at the time this Bill was first being discussed, we feel there was no need for the Government to be called upon to provide further working capital. As recently as last year, in continuance of the shall I say very sticky history of some of the companies engaged in beet sugar manufacture, people who knew, apparently, that this reorganisation was going to take place under an Act of Parliament, proceeded to distribute large cash bonuses to their shareholders. I have made one or two inquiries about those distributions and the figures are extraordinary. In May, 1935, Tate and Lyle—who, I must make it plain, are not occupied solely with the manufacture of sugar from beet, being also refiners, but who have a considerable interest in the manufacture of sugar from beet—distributed a sum of £1,360,000 out of reserve funds as bonus shares, at the rate of two new shares for every five shares held. The English Beet Sugar Corporation in the same month distributed £300,000 by way of cash bonuses to its shareholders, in addition to the dividend fixed for the year. The Ipswich Beet Sugar Factory distributed last year £140,000 by way of cash bonuses, this distribution being free of Income Tax. The Ely Beet Sugar Factory distributed in the same year and in the same way £300,000 by way of cash bonuses.

In view of all that we submit that it is an extraordinary thing that we should now be asked, during the course of the reconstruction of this industry, to authorise the Treasury to advance another £1,000,000 towards the capitalisation of this industry, not, of course, by adding to the ordinary capital but by way of debentures. When we put questions about it we are told that this £1,000,000 is actually required for working capital, although the very people who are to have the advantage of a guaranteed debenture issue of £1,000,000 have so recently as last year distributed in cash bonuses over £700,000, in the case of three companies, and a considerable proportion of the further distribution made by Tate and Lyle must be related to the beet sugar industry. The people who distributed that money last year ought to be made to finance this debenture issue themselves. We have now had the advantage of studying the White Paper.

My hon. Friends who sit and speak with me will, I am sure, agree that it was very unreasonable that Members of the House should not have had the White Paper until the Bill had left Standing Committee. We ought to have had far earlier information of the details of the amalgamation proposed. The Minister shakes his head, but he must see the difficulty, because here we are, at the Report stage, and called upon to deal with important financial Clauses which have been through the Standing Committee at a time when we had no real information of the financial details of the amalgamation. In the White Paper it says that £750,000 of this £1,000,000 which is to be backed by Treasury guarantee is to be subscribed by the transferor companies, who will be shareholders in the new Corporation. But they are to do it with the guarantee of the Treasury. It cannot go wrong.

Mr. ELLIOT

Does the hon. Member want us to pay a higher rate?

Mr. ALEXANDER

When the Minister says "us" is he speaking for the industry? Is he the industry?

Mr. ELLIOT

No, I mean "we, the House of Commons"—the State.

Mr. ALEXANDER

That point does not arise. Of course it does not. At any rate I shall be very glad to hear the Minister's explanation of his statement that it is going to cost us more money. If in view of Chapter 10 of the Wilfrid Greene Report the Minister had stood firm and had said, "If you distribute the liquid assets of the companies"—which Table 21 of the Report clearly shows to be there—"we shall not provide you with any further assistance" they would not have distributed the money.

Mr. ELLIOT

That would mean it was going to cost us more.

Mr. ALEXANDER

It need not cost you anything more at all. Surely you are going to arrange for future aid to the industry at so much per cwt. of what are the actual costs. That is all it is going to cost you. As we look at the White Paper the consideration is £5,000,000 of shares in the new Corporation based upon—at least I hope it is based upon—the written-down value of the industry, and I fail to understand how the Minister can say it would have cost the Government more if he had done it in any other way than this. You allow the cash assets to be distributed to the shareholders and never recovered from them—because you will not get that money back—and then you have to issue £1,000,000 in debentures to provide working capital for the Corporation.

Mr. ELLIOT

The higher the rate I have to raise this capital at, the more it will cost, and if the right hon. Gentleman wants us to raise it cheaply I cannot understand why he objects.

Mr. ALEXANDER

The Minister objects that if we had proceeded in any other way he would have had to raise capital at a higher rate. What we are saying is that if the Minister had been firm and prevented the distribution of those cash bonuses there would have been no need to raise further capital.

Mr. ELLIOT

Nonsense.

Mr. ALEXANDER

All right, then the Minister must explain that in detail later. I cannot understand how it is possible to distribute more than £1,000,000 in liquid assets to shareholders last year which could have been prevented if the Minister had been firm—

Mr. ELLIOT

It would not have made any difference.

Mr. ALEXANDER

Of course it would have made a difference. Instead of preventing that distribution he now has to mulct the Treasury in at least a contingent liability for a new issue of £1,000,000. If I am wrong we shall want a more detailed explanation of it than the Minister has given.

We put another point during the Committee stage about which, even after we have seen the White Paper, I am still not satisfied. One of the groups of companies connected with this industry is the Anglo-Scottish Beet Sugar Corporation. We pointed out that this series of companies had financed their capital undertakings in the past largely by issues guaranteed under the Trade Facilities Act, and by a series of questions we were able to gather that there were still outstanding commitments to the amount of £948,000. We suggested that the £1,000,000 of working capital is now to be raised by the issue of debentures because the Treasury are to be repaid the £948,000 which the Corporation owe, but from the White Paper things will obviously not go as far as that, because I see that the transferor companies have to put up £750,000 of debentures, although the Treasury will still accept the contingent liability that follows from guaranteeing the stock. We should like to know how, inside this arrangement shown in the White Paper for financing the amalgamation, the Treasury are going to be repaid the £948,000. What is going to happen? Are the Treasury receiving cash from the Anglo-Scottish Beet Sugar Corporation? Are the Treasury only to receive a given number of the shares in the new Corporation? If so, are they going then to continue to hold shares in the new sugar Corporation which is to be set up, or is it proposed that this settlement of Lord Weir's liabilities to the sugar scheme should be made by the Treasury selling the new shares in the new sugar Corporation at their market value as soon as they are available?

It is true that in the White Paper it is said that the normal rate of dividend expected on the new shares is 4 per cent., but it must not go beyond 7 per cent. without Treasury consent. It is also suggested that there are to be arrangements for sharing the results of the economies, or increased efficiency, so that the return upon these shares may go up to 7 per cent. Are the Government going to get rid of the shares at once, if this is the method of payment? I am still in the dark about it. Are the Government going to get rid of the shares at their early values, or hold them and take the advantage? The Minister smiles, but it really is not a smiling matter. Let us remember that this industry has already cost this country £50,000,000, and at this stage of re-organisation and amalgamation we are still providing for a maximum of 7 per cent. to be earned by the Corporation, still with the granting, either directly or by remission of Excise Duties, of £5,000,000 a year. Surely we are entitled to know what I have been asking. We have never had an opportunity of getting to understand what was really behind it, and the Minister must not feel vexed with us about it.

Mr. ELLIOT

A moment ago you complained that I was smiling.

Mr. ALEXANDER

We said at the outset of the Debate on the previous Amendment that we recognise that the Bill has been much improved. We know that the public interest is far more safeguarded in this matter because of the pressure of the Opposition than would otherwise be the case, and we know that if the Ministry of Agriculture had had their way three years ago we should be mulcted to-day in a perpetuation of the rotten type of system which would continue to batten upon the consumers of sugar. The scheme is much improved, but we have the right to know what is exactly the position, on the lines along which I have been inquiring, and to press for further public safeguards in the cleaning up of one of the greatest financial muddles and scandals that this country has ever had.

We are moving the Amendment in order to get that information, and to get a further and adequate explanation. There is another point to which I ought to refer. I should like to have the answer from the Minister right away so that my hon. Friends can consider the matter. In the White Paper, the consideration to be issued in shares to the new Corporation, upon the transfer of the assets of the 15 beet sugar companies which are to be amalgamated, is £5,000,000, in which are supposed to be included all the assets to be transferred to the Corporation. I cannot for the life of me understand, in view of the fact that these companies have done so extremely well out of public funds in the past, why all the assets in the companies are not to be transferred for that consideration. We moved a certain Amendment in Committee to get the information, but it did not get us much further. In the White Paper issued last Friday, we see that there is something else in it. I will quote from page 10: The transferor companies shall transfer to the Corporation all their good will and fixed assets (which, subject to the provisions of the preceding section shall be in good working order and condition), with the exception of those fixed assets which were excluded from the original scheme, viz.: those parts of the Kelham Estate which are not occupied by the factory or used in connection therewith, and the farming assets owned by the Home Grown Suger, Limited. Why on earth, at the end of something like 12 years of continuous payments out of public funds and 12 months after certain of the companies concerned have been distributing cash bonuses to their shareholders and we have come to the final amalgamation and the settlement of of the capitalisation of £5,000,000, there should be withheld from the Corporation all the assets of the companies amalgamated, I cannot imagine. We are entitled to know the answer.

It may be said, and in view of what the Minister said just now I expect it will be said, that you can always alter the basis of capitalisation of the new Corporation by taking over land which you are not using or not likely to use, or this or that section of the assets, and that you can do it by putting up the amalgamated share capital, which would mean a larger annual return to be earned. If you took the assets to be excluded, no one could say, on taking into account the history of the industry, that the £5,000,000 now to be fixed was too low a figure. I should say that that figure is ample. If we are to try to bring this business on to an even keel and to save the public purse as much as possible in the future, we ought to see that all the assets which have been created with the help of public subsidies in the past should be brought into the possession of the new Corporation inside that figure of £5,000,000. We are entitled to have this matter explained to us.

There are other aspects to which I do not propose to draw attention. My hon. Friend the Member for Don Valley (Mr. T. Williams) will listen to the rest of the Debate on this very important issue which we are raising in this way, and it will depend upon the reply of the Minister and the general attitude adopted by the Government in Debate as to what decision we shall take upon this Amendment. As at present advised, and upon the information before us, I can see no course open to us but to press the Amendment strongly in the Division Lobby. We shall be very glad to hear the Government's explanation. We have no other object in view in this matter but of seeing that this industry is cleaned up, and that when once it is put into its new and reconstructed form it shall as soon as possible, be self-supporting, without the doles which it now gets from the public purse. If the Minister shows that this will be the effect of what he is doing, we shall be modified in our attitude. At present I have no such information.

6.22 p.m.

Mr. ELLIOT

I will follow the right hon. Gentleman at once because I realise that he wishes to have as far as possible the information at his disposal before the Debate goes further, and it is very desirable in complicated matters like this that we should put all the cards on the table forthwith. Therefore I would like to deal as specifically as I can with the three points which he raised and which were: why there should be an issue of capital here with a Treasury guarantee, what is the exact position of Anglo-Scottish, and why certain assets are not being taken over by the new Corporation. I think that puts the case fairly.

As to the first point, I think it is due to some difficulty in appreciating the situation, which I tried to make clear during the discussions in Committee. The whole purpose of this proposal is to reduce the payments from the public purse. The reason why we are giving the Treasury guarantee is to raise this money at as low a rate of interest as possible. If we did not give this guarantee to the industry, already safeguarded by the well-known fact that the country and both sides of the House desire to continue the sugar beet industry, clever men might take advantage of that fact. The difficulty is that the continuance of the sugar beet industry is itself evidence that the minimum rate of interest will be earnable by capital secured upon this Corporation. The right hon. Gentleman says "This is something which is being given to the companies by the Government," but it is clear that it is something which is being taken from the companies by the Government.

Mr. ALEXANDER

indicated dissent.

Mr. ELLIOT

Well, that is my contention, and is the point I am trying to make, and if I do not make it clearly, I am sorry. In fact, this is a device, a formula, by which the liquid assets of the companies are being taken over at the lowest possible rate. Let me see if I can establish that case. Clearly some proportion of the liquid assets of which the right hon. Gentleman complained would be used, and the remainder would not be used. It is undesirable for the combination to burden itself with too great a quantity of liquid cash. It requires some but not all of the liquid cash. That liquid cash would have to be taken over at some rate of interest. If it were taken over at a rate of interest comparable to what would be required to be paid in the open market, that rate of interest would be fully 5 per cent., and probably more. [HON. MEMBERS: "More."] I think more than that, but let me put it at 5 per cent., although it might be considerably higher.

If I can carry the House with me in this matter, I would point out that in raising money, the Treasury guarantee enables us to pay one-half or more per cent. less for the money than we should have to pay if there were no Treasury guarantee. The Bill is better than a Treasury guarantee, because it is a Parliamentary guarantee. For good or ill, Parliament has decided that the industry shall be carried on. I think it is agreed in all parts of the House that though all of us desire, with the right hon. Gentleman the Member for Hillsborough (Mr. Alexander), that the industry should be self-supporting as soon as possible, we want it to be carried on and we do not desire it to be discontinued. If there is a Bill on the Statute Book to say that the industry shall be carried on, that is equivalent to the contingent guarantee that the Treasury is giving here. Consequently if we are to get the benefit here—

Mr. ALEXANDER

If we were dealing in the ordinary way with an amalgamation between two ordinary companies and taking over liquid assets, I should agree with the presentation of the case by the Minister, but what we strongly object to is that, in the course of the committees of investigation and of inquiry in the last three years, when all this was known and when it was known there was going to be a reconstruction by Statute, the Minister allowed the liquid assets to be disbursed. Had they not been disbursed, you could have paid a lower price for the fixed assets, or else you could have taken over that liquid cash instead of raising a debenture. That is the position which affects the whole basis upon which you have carried out your amalgamation. The disbursement of that block of hundreds of thousands of pounds of liquid cash last year has made it incumbent upon the Minister now to provide the new issue of debentures guaranteed by the Treasury. That is our whole point, and I do not think that it is unreasonable.

Mr. ELLIOT

I think it is, because the right hon. Gentleman wishes to have it both ways. If, three years ago, it had been decided that the industry was to be carried on, and thereupon a Bill had been passed through Parliament to that end, no doubt the present position would not have arisen. After long debates and arguments, which went on from both sides, and the fact that we were pledged to the most meticulous inquiry by chartered accountants, by the Wilfrid Greene Committee and inquiries of one kind and another, the industry was carried on in the interim by merely prolonging the subsidy, admittedly at rates above those which would have been necessary if the Bill had been passed into law and the amalgamated company had been formed. The Bill was not law and the amalgamated company had not been formed, and the House and the country were continuing discussions whether they desired to carry on the industry or not. It is to that process of investigation that the right hon. Gentleman must refer, and not to any process of dissipation of reserves, because, the reserves having been accumulated, they have to be taken over by the Corporation or given back to the shareholders. The assets which are being taken over by the Corporation are being taken over at the lowest possible rate, and at a rate far below what would otherwise have been possible, by means of this provision which I am asking the House to accept. I do not think I can go further in my presentation of the view held on this side of the House about that point.

With regard to the second point, as to the position of the Anglo-Scottish group and how the Treasury are to be repaid, in the first place, as the right hon. Gentleman said, the Anglo-Scottish companies will be among the companies taken over by the Corporation, and after the amalgamation they will be acting on behalf of the Corporation and not as separate units. The promoters of the groups raised money, which was loaned to them under the guarantee of the Treasury, under the Trade Facilities Act, the sum raised being 1,625,000. Some of the interest on that loan has been repaid, notably in the case of the West Midland Sugar Company, but for the past few years the Anglo-Scottish group have not been able to meet their obligations in interest. None of that money has been forgiven. It remains as a liability which they have to pay off if they are to clean their slate with the Treasury.

The remaining debt due to the Treasury amounts, as the right hon. Gentleman said, to some £948,000, and the whole of that is secured by the assets of the companies. If this Bill is passed, those assets will be live assets; if the Bill is not passed, they will be dead assets. The Corporation will buy up those live assets by the issue of ordinary shares, as it is buying up the assets of all the other transferred companies. The procedure will be that the Anglo-Scottish group will realise the cash value of its allocation of ordinary shares, and, with the money thus obtained, will repay in full the remaining part of the loan guaranteed by the Treasury. They will be enabled to do that because the industry is going on; they would not be able to do it if the industry had been coming to an end. When the fixed assets of the Anglo-Scottish group are taken over by the Corporation, the Corporation will have bought and paid for them by the issue of ordinary shares, and the operation of the assets will be a matter for the Corporation. I think the right hon. Gentleman will now agree that this £948,000 has nothing to do with the issue of debentures which I have already explained, but is a debt still due to the Treasury which will be repaid by the companies concerned out of the proceeds of the sale of their fixed assets to the new Corporation.

Mr. ALEXANDER

The right hon. Gentleman will surely complete his answer to my question on that point. Do the Treasury propose to hold the shares, or what is going to be done? Are the Treasury going to dispose of the shares, or are they going to hold what will be in fact a public interest in this new Corporation?

Mr. ELLIOT

It was on that point that the right hon. Gentleman reproached me for smiling. If he were the Treasury at this moment, he would not explain to the market that he was or was not about to put on the market a very large block of shares. He would, like a good business man, decide whether he would continue to hold the shares or whether he would dispose of them, and, if he disposed of them, he would do so at some moment at which he would gain a maximum return for the Treasury, and therefore for the State. That is a perfectly straightforward explanation.

Sir PERCY HARRIS

A little bit of speculation.

Mr. ELLIOT

I think it is unjust of the hon. Baronet to say that, when we are liquidating funds under the Trade Facilities Act. Naturally, you must choose a proper moment at which to liquidate them.

Mr. BARNES

Can the right hon. Gentleman indicate whether the Treasury is taking over the whole of the share capital assets of the Anglo-Scottish Corporation, or a part of them, and, if so, how much?

Mr. ELLIOT

The Treasury is taking over this debt. Whatever the Anglo-Scottish group owes will be taken over by the Treasury, what remains will be available for the shareholders—I do not think it will be very much—and the assets will be taken over by the Corporation.

Mr. BE LLENGER

You are not getting cash?

Mr. ELLIOT

We are getting a realisable asset which can be turned into cash. We are getting 4 per cent. shares, which may go to 7 per cent. with a reasonable amount of assistance from this House, and, if it is not cash, it is a thing that I would very much like to have a million pounds worth of myself. The Anglo-Scottish group are losing it all; it is all being taken by the Treasury.

Mr. A. BEVAN

The asset that is being taken over is the amount owed to the Treasury?

Mr. ELLIOT

It is not quite that. The assets are being realised as rapidly as possible, and the Treasury is getting out of the business.

Mr. BEVAN

What it does with the assets is a matter for itself?

Mr. ELLIOT

I am trying to deal with the point raised by the right hon. Gentleman that there was a danger of some sharp practice, if I may so put it. In answer to the last point raised by the hon. Member for Ebbw Vale (Mr. Bevan), the Treasury is not itself taking the actual shares, but is in due course taking the cash realised by the sale of the shares; but, naturally, as to the moment when it realises it must be the judge—it must drive the best possible bargain for the State.

The right hon. Gentleman also raised the question why the £5,000,000 does not include all the assets. As I tried to point out in Committee, there are certain of these assets which the Corporation does not want. I pointed out that in the case of Home Grown Sugar Estates the Corporation would very probably not wish to have them, and would not take them over, because it did not see its way to employing them profitably. If it had wished to take them over, some additional price would have had to be given for those assets. The right hon. Gentleman shakes his head, and no doubt, if he had been in our place, he might have driven a much harder bargain. His estimate of the financial skill which he would apply to this transaction is naturally that it would have been greater than ours. By skill I mean getting more out of the person with whom you are dealing than otherwise you would have got. These assets included certain properties which the new Corporation did not wish to operate, and, therefore, it has not bought them all; and the Bill provides that it would not need to buy these properties, because it would be of no use to saddle it with properties that it did not see its way to operate. I hope the House will agree that I have dealt exhaustively and as clearly as possible with the questions which the right hon. Gentleman raised, and that it will be possible for the House to accept the explanation I have given. I have tried to be as frank as possible. If any further information is desired I shall be very pleased to give it, but I think the explanation I have given will satisfy the House.

6.42 p.m.

Mr. BARNES

I regret that, although the Minister has dealt exhaustively with this subject, he has in no way satisfied my uneasiness with regard to this financial transaction. It is extraordinarily difficult to get the true facts either from the Treasury or from the Minister, and I think it would have been a distinct advantage to the House if we had had a representative of the Treasury on the Bench this evening, so that we could have put direct questions to him as well as to the Department affected. The Minister has not made clear how he can make dead assets into live assets. In the allocation of share capital shown in Appendix No. 2 on page 15 of the White Paper, there is a sum of £513,000 for the Anglo-Scottish Beet Sugar Corporation, and for the Second Anglo-Scottish Beet Sugar Corporation there is another allocation of £596,000. I think we are entitled to know whether that represents a full valuation of the assets of these companies, and, if so, why the representative of the Treasury, in reply to a question in this House, stated that if this Bill became law the fixed assets of the companies in question could be valued as the assets of going concerns, and that on this basis it could be assumed that they would realise a sufficient amount to enable the companies to repay their guaranteed loan debts. The Minister has dealt with that point, but there is one thing that he has not made clear. He has indicated that, as the result of the allocation of share capital in the case of these two companies, they will be in a position to repay their loan to the Treasury, but he went on to make the significant statement that the Corporation would have the assets. I should like that point to be cleared up. I do not know whether it was a slip of the tongue, but I do not see how at the same time the Treasury can receive payment of that loan and the Corporation can have any assets belonging to the Anglo-Scottish Beet Sugar Corporation.

Mr. ELLIOT

I may have made a slip. I meant that they would operate the assets.

Mr. BARNES

Who would operate them?

Mr. ELLIOT

The Corporation.

Mr. BARNES

How could they operate them if the Treasury has got them?

Mr. ELLIOT

The Treasury has the usufruct of the assets but the Corporation has to operate them.

Mr. BARNES

Assuming that the Treasury realises those assets, until it does realise them, I take it that the Treasury will be a direct and a large holder of the shares of the newly-created Corporation. Is that correct?

Mr. ELLIOT

Not the Treasury as such. It will realise the assets as rapidly as possible.

Mr. BARNES

Until the Treasury realises those assets, will it in fact be the owners of the Anglo-Scottish Beet Sugar Corporation?

Mr. ELLIOT

No, because the group of factories will disappear as from the passing of the Bill. There will be a certain amount of shares which it will be getting rid of as rapidly as is convenient in the new Corporation but the Anglo-Scottish group as such will disappear forthwith.

Mr. BARNES

And the Treasury will be in fact the owner of the shares of the amalgamated companies previously belonging to the Corporation?

Mr. ELLIOT

No. It will have a lien on the pool. All the eggs are broken into an omelette and it will have a share of the omelette of which it will get rid as rapidly as possible, but it will not be able to point to one part of the omelette and say, "This was made with my egg."

Mr. BARNES

This is the only public holding that we have in this Corporation. Why should the Treasury dispose of a holding of this kind and hand over a very important lever in the Corporation?

Mr. ELLIOT

Because the Treasury want the money. It is like a claim on an estate for Death Duties. The Treasury does not hold it, but gets the money as soon as possible.

Mr. BARNES

That argument cannot be substantiated, because in this case the Treasury is paying the whole of the subsidy upon which the Corporation will operate, and the provision of interest up to 7 per cent. depends entirely on the Treasury payments. The interest on the debentures depends on the Treasury guarantee. It is an extraordinary position that, on the valuation of these assets, a dead asset which could not previously pay its debts is suddenly in a position to repay the Treasury advances. When the Treasury gets the assets it disposes of them to private interests and allows them to take a high rate of interest, which the Treasury pays in the long run.

6.49 p.m.

Mr. BEVAN

I think the Minister has been admirably clear in his exposition of the birth of the Corporation. I understand that there is a company which at the moment has fixed capital assets on which it is not able to earn money to pay its debt to the Treasury. Now the Treasury proposes to put that company, along with a number of other companies, in a Corporation and transfer the assets that it has and then, by giving a Treasury guarantee up to a maximum of 7 per cent—[Interruption.] We understand that there is a Treasury guarantee and we understand that they can earn up to 7 per cent. and, inasmuch as the Treasury is going to guarantee the floating of the Corporation and the raising of the necessary sum, the Government will see to it by its own policy that the Corporation will be able to earn up to a maximum of 7 per cent. So it is the action of the Government which will convert that dead asset into a revenue-earning asset. It seems to me that, as it is the action of the Government that is going to make that asset into a revenue-earning asset, they ought not immediately to dispose of it.

Mr. ELLIOT

It is not a guarantee. It may earn 7 per cent., it may earn 4 per cent. or it may earn very much less. The capital of the Corporation is not guaranteed in any way at all. That is why the Treasury wants to sell. After all, the Treasury is not prepared to enter into a speculation. Think of the condemnation of the House. The Treasury's business is to realise and get out.

Mr. BEVAN

The right hon. Gentleman now overstates his case. Here is the Treasury with a capital asset which it is hoping to convert at the earliest possible moment into liquid money in order to get its debt paid. The right hon. Gentleman has explained that the Treasury will naturally select the proper moment to sell the shares in order to have its debt discharged. So the Treasury will wait until more money is being earned on the asset before it sells out. In other words, when the asset becomes more profitable to private business, the Treasury proposes to dispose of it because, if it disposed of it earlier, it would get less for it. The more potentially profitable it becomes, the more the Treasury could earn on it, the readier the Treasury will be to dispose of it. That is what my hon. Friends are protesting against, and I think their protest is reasonable. You have by your own action to make the property valuable before it pays you to dispose of it and, as you make it valuable by your own action, you hand the property that you have made valuable over to private finance because the capital realisation will be higher. It is just at that moment that you ought to keep it, when it is earning revenue. I think that is a reasonable contention. It is the policy of the Treasury to get its debts paid in full and not to hold property, but that is not the point of view of Members of this party, and inasmuch as the value of the property results entirely from public action, is maintained by public action, and has its birth in public action, it seems entirely reasonable that the value of the property thus created ought to remain a public asset rather than that the Treasury should seek the very moment when it is most valuable in order to disperse it and lose the advantage that the nation might otherwise enjoy.

6.54 p.m.

Mr. MacLAREN

I congratulate the Minister on having converted any hon. Friend, because he has a most rosy idea of the Stock Exchange. Whenever your shares rise hold on and do not let them go.

Mr. BEVAN

The contention that I admitted is that it is only when shares are higher in value that it pays you to dispose of them.

Mr. MacLAREN

It is not a constant characteristic of shares to remain at a high point. The Minister has made two points which we should appreciate. The first is very interesting. My right hon. Friend impeached the administration on the ground that they were rushing out to get financial props to hold up a structure that was rather fragile. He said that this structure had got into this weak condition, necessitating Government support, because of a liberal distribution of bonus shares before a certain date. The Minister's reply is very instructive. He says the distribution of bonus shares was necessitated because of the delinquency of the House of Commons in coming to a definite conception with regard to the policy that should be pursued in the future with regard to the sugar industry. Surely, if there was any lackadaisical attitude of the House of Commons, it was the fault of the last Administration. The fault does not lie with us on this side. The right hon. Gentleman made rather a fatal mistake when he said that what we want, when we hay e got hold of the shares, is to realise them as quickly as possible and that it was like imposing Death Duties. I have never heard of anyone wanting to realise Death Duties by pumping fresh blood into the corpse, and that is what is happening here. The right hon. Gentleman says that the debt could not be paid to the Treasury unless this amalgamation was carried through. In other words, if we were not now, in the name of the taxpayers who sent us here, passing this into law, the debt of the Anglo-Scottish group and the rest of the plunderers who have plundered the State to an extent unknown in the history of this land could not be recovered.

What you are doing here is throwing a lifebelt to Lord Weir to pull him back into the business life of this country. The dead assets are suddenly to become live things, palpitating with new life and, possibilities. Who put the new life into them? We will be doing so by our vote to-day if we pass this Clause. What did the "Financial Times" say in reviewing the situation on 17th May, 1335? It said: £40,300,000 almost exactly equals the amount paid for beet. After marketing and manufacturing costs of £15,400,000, the 15 companies were left with a trading margin of £11,200,000. The Minister says to-day that this inflated wealth in the hands of these companies had to be somewhat dissipated because the House of Commons had no definite policy on what was to be done regarding the future of this industry. It is well to remember, in conjunction with what I am now saying, that what we are about to do by passing this Clause is to put the State's good name behind dead assets, retrieve them from their rather precarious circumstances and give them a good reputation on the market. And, says the Minister, they may rise to 7 per cent. By virtue of what? Of what we are now doing. It is a sorry pass, but it is characteristic of the new policy of statesmen who will put their bands in and try to organise and correlate things in certain fields of activity where the last things you want to see are bureaucrats and statesmen.

There are many hon. Members on the opposite side of the House not directly interested in this industry who must have qualms of conscience about this Clause. I hope they will show their courage and vote for the Amendment. It is all very well for the Minister to say that he must resort to this action in order to get the money at a low rate of interest. I thought for a moment that he was going to claim it as a virtue that these assets had been dissipated because it meant that there was not so great a burden to be taken over by the State. I have made these few comments to amplify what the right hon. Gentleman has said, and in the hope that some hon. Members will see the seriousness of the proposition that is before the House.

7.5 p.m.

Mr. SPENS

The picturesque description of an ordinary business transaction which the hon. Member has given deserves some answer. There is £948,000 owing from two companies and secured on certain assets which, if matters remain as they are, will not suffice to repay that sum to the Treasury, and the Treasury will have a bad debt. A scheme is put forward by which, if these assets are amalgamated with others, they may become remunerative. In exchange for parting with these assets these two companies get shares in the Corporation, subject to the charge payable to the Treasury, and instead of the Treasury and the taxpayer having an indifferent charge on a certain basis, the Corporation get shares subject to that charge, with a prospect at the right time and bit by bit of the shares being realised and the amount the Treasury originally lent being paid back. I hope in these circumstances the House will pass the Clause.

7.7 p.m.

Mr. BELLENGER

It is necessary that we should consider more than we have done the capital construction of this Corporation, particularly as the Treasury will be a shareholder. I do not agree with the hon. Member for South-West Bethnal Green (Sir P. Harris) that the Treasury are speculators, but I suggest that what the Treasury is holding is a speculative asset. If all goes well this asset may realise above its par value. I am not sure that the Treasury will get a better asset by its shares in this Corporation than by its charge on the assets of these two Scottish companies. If there is to be a reply from the Government, I would like an answer to one or two questions. On page 7 of the White Paper we are told by the tribunal: Broadly, we considered that, in all the circumstances, written-down replacement costs, and not written-down original costs, should be the basis of valuation. I should like to know how that valuation has been made and how, for example, property has been valued at written-down replacement costs. A further statement by the tribunal is interesting in considering how the capital of the new Corporation has been made up. In paragraph 14 they state: We accepted the contention of thee negotiating Committee that, since the consideration to be given for the fixed assets to be transferred to the Corporation is to be shares in the Corporation, it is necessary to consider, in conjunction with the total valuation of fixed assets, the probable return on the Corporation's capital. It seems to me that in arriving at the capital construction of this company they axe not only taking some value of possible fixed assets, but they are also taking into account what a certain amount of capital might be expected to realise in interest from year to year—a rather remarkable way of forming a new company. I should like to know what are to be the shares in the new Corporation which the Government will hold, whether they are to be ordinary shares, preference shares or what? If we had an answer to that question we could form some conclusion whether the Treasury is holding a good class of share. A little further on in this White Paper we are told: This issue of debenture stock shall be made … without underwriting charges or commission. I want to pay tribute to the negotiators who have inserted that provision in the report. It is just as well that this debenture capital shall be issued with no commission charges and no underwriting charges. The White Paper also states: The terms and conditions of the issue, including the rate of interest and the price of issue, shall be subject to the approval of the Treasury, provided that the price of issue shall not be more than the estimated market value of the debenture stock at the date of the issue. What is that going to be? Is it to be above par, or below? Can we have some indication from the Minister? The assets which are being transferred by the 15 companies to the Sugar Corporation would only have been of scrap value, according to the Greene Report, if the Government had not asked us to give this continued support to the industry. I hope that the assets the Government are going to get in the shares of this new Corporation will realise all that the Government have put into these two companies, a sum of nearly £1,000,000. I hope and believe that the Treasury will sell these shares. I do not believe in the Treasury holding any of the shares in this new Corporation. The Treasury should get out of it as soon as possible, and I hope that they will get out of it to the best possible interest, of the taxpayers.

7.12 p.m.

Mr. T. WILLIAMS

I am sure that the Minister would like to get out of it, and I am equally certain that the Treasury would like to get out of it too, and out of the annual remission of about £5,000,000. The right hon. Gentleman clearly explained that the smaller the rate of interest on the guaranteed debentures, the lighter the contingent burden on the Treasury would probably be, or the actual burden as determined by the subsidy that would have to be paid from time to time. We entirely agree with that, but what I did not understand in his reply was this: He said there must be liquid capital in the initial stages, and that it is no use reverting to 1935 for something that has been taken away; it is something that has to be put in that matters at this moment. That is true, but it is a remarkable thing that all these companies distributed their cash bonuses in the same year. It rather seems to hint that they heard something more than a whisper that a Bill on these lines was likely in the near future. I know that the Minister cannot go back to these companies and say, "Why did you distribute £1,360,000 in shares, why did you distribute £1,300,000 as cash bonus?" I know he cannot recover what has been expended, but our point of view is that for years the barons in the sugar industry have been exploiting the Treasury and that even now, when they know there are no assets in any one of these factories, or in all of them apart from the Government subsidies, they still at the last moment take the last penny available to them.

The right hon. Gentleman truly said that the Bill has to be passed if the industry is to be preserved. Clearly, financial arrangements have to be made to carry on the industry. But whether or not the Treasury should be called upon to grant £1,000,000 of debentures so that they may obtain it at a smaller rate of interest is another thing. Several questions have been put regarding this White Paper and the debt of the Anglo-Scottish group to the Treasury. The right hon. Gentleman tells us that the debt stands at £948,000. An hon. Member sitting on the back benches declared that it is sound business for the Government to introduce and carry through a scheme which will convert a bad debt of £948,000 into a valuable asset. The hon. Gentleman does not seem to understand that, while we are converting that bad debt into a realisable asset, we are doing it out of money provided by the Treasury. We are going to pay ourselves back with our own money. It is not as sound a proposition as the hon. Gentleman seems to imagine. Before we can ever hope to secure the return of that money, we have to say to the factory owners, "Once your Corporation is established, according to the terms laid down in the Order we shall permit the 15 companies to have a capital of £5,000,000 and shall guarantee them an annual interest of 4 per cent., and a further interest on improvement value of anything up to 5½ per cent. for 10 years." It may be that on occasions it may reach as high as 7 per cent. That is all out of money provided by the Treasury and it is clearly a guarantee that turns these dead liabilities into live assets.

It is a very unpleasant chapter. My right hon. Friend has called it a sticky business. It has been a sticky business from the first, and it is to continue to be a sticky business. A lot of sticky people have been exploiting the nation for a very long time. The right hon. Gentleman, in reply to one of my hon. Friends, said that we were not guaranteeing a 4 per cent. return on the £5,000,000. I am sure that the right hon. Gentleman unintentionally fell into error at that moment. If he looks at page 11 of the White Paper—and the Treasury will have accepted this Order once the Bill is passed—it says: (1) That the Tribunal will recommend to the Treasury that, for the purposes of Clause 14 (5) (b) of the Bill, a reasonable rate of interest in the circumstances existing at the present time is 4 per cent. per annum and that this should be calculated on the capital, other than the borrowed working capital, employed with the approval of the Sugar Commission. On page 12 it says: The amount of the capital so employed will, in the first instance, be £5,000,000. So that there is a definite guarantee of the Treasury of 4 per cent. on £5,000,000 per annum. If the right hon. Gentleman can inform the House that I have misrepresented that paragraph I will readily sit down while he does so. In page 14 the provision is made that: If in any year, by reason of exceptional circumstances beyond its control, the Corporation should require to draw on its reserves in order to pay a dividend of 4 per cent. on its capital, the Corporation will propose to the Sugar Commission that, if the Commission should think fit in the light of all the circumstances prevailing, they should recommend the Government to make provision in the rate of assistance for the following year or years, towards replacing the amount withdrawn for this purpose. That is, after the Government have decided such payments that shall be made to the industry to ensure a return of 4 per cent. if for any reason beyond the control of the Corporation in any year there is not sufficient to pay the average uniform of 4 per cent., they can come back to the Treasury, and the Commission have the power to recommend that in a future year or years the Treasury can slightly increase their contribution to ensure the 4 per cent. On top of that 4 per cent. there is the additional promise that where economies are effected, the Corporation can secure up to 1½ per cent. interest in excess of the 4 per cent. per annum, making an almost gilt-edged guarantee of 5i per cent. for 10 years. That is as I read the Order. The House must remember that the Order came into operation yesterday. The Minister has sanctioned the Order and the Treasury has approved of it, and, therefore, the rates of interest referred to are definite and specific, and I return to where I originally started.

The Anglo-Scottish Beet Company have not liquidated their liability to the State because their business was an unprofitable one, and apart from the Treasury subsidy, they had not an asset at all. The way they have been able to qualify for the shares which have been allotted to them in the Corporation is not because of the quantity of sugar beet that they have refined, but because of the imported raw sugar that they have refined against the general scheme as adopted, approved and worked by other representatives of the beet sugar factory group. We are transforming a dead liability into a live asset, but we are simply paying ourselves with our own money. It is one of those very unhappy chapters in our legislative history, which, I hope, will not be repeated for a long time.

7.22 p.m.

Mr. ELLIOT

Perhaps it will be courteous if I now reply to the various questions which have been put to me. The subject is very wide and the discussion has covered the whole finance of the scheme. I do not wish to go outside even the very wide discussion which we have had, except to say that it is impossible to consider the scheme without considering the fact that the purpose of the scheme, if accomplished, is not merely to preserve the companies but to preserve the growing of sugar beet in this country and the employment of 400,000 acres and scores of thousands of workers. It was estimated that some 40,000 people were employed in one way or another among the agricultural population of this country owing to the growing of sugar beet. Its influence, as every practical agriculturist knows, extends far beyond the people concerned with growing sugar beet in this country.

The asset which the State possesses as a result of these proposals is the industry of agriculture, and that is a thing which the House should not forget when discussing these points of finance. The hon. Member for Don Valley (Mr. T. Williams) asked the specific question as to how land should be valued and written down for replacement value. It is clear that what the White Paper has in mind are the assets as a whole, of which the factories constitute by far the greatest proportion, and the price of the land naturally should not be written down at replacement value. The hon. Member asked whether the Government were holding ordinary or debenture shares. The Government are not holding shares at all. They are holding a lien on the shares which the Anglo - Scottish group is getting as a result of the amalgamation

in this Corporation. The cash will be realised as soon as possible. The hon. Member asked what was the estimated market value referred to in page 11 of the White Paper: The terms and conditions of the issue, … shall be subject to, the approval of the Treasury, provided that the price of issue shall be not more than the estimated market value of the debenture stock at the date of issue.

That is, the estimated market value of the stock of this quality, with the guarantee that the price will not be above that figure. These were the specific points that were raised, but I think that the general argument of the hon. Member for Don Valley would take me into the realms of a Second Reading Debate. I repeat that the purpose of this proposal is to maintain the factories and the processing of sugar beet in this country and thereby maintaining the sugar beet acreage. I know that there is a division of opinion in the House. It has been decided by the House on Second Reading, and I hope that it will be decided again on the Third Reading that that shall be so. I cannot go into arguments for or against, as I should be out of order, but I do not apologise in any way for the decision the House has taken. I used my utmost endeavours to persuade the House to come to that decision, and I shall, on the Third Reading, use my utmost endeavours to persuade it to come to that decision again. It would be a bad thing if we scrapped £5,000,000 of food-producing machinery in this country to-day, and would be still worse if we scrapped 400,000 acres which are producing sugar beet for the beet sugar factories.

Question put, "That the words 'one million' stand part of the Bill."

The House divided: Ayes, 220; Noes, 124.

Division No. 135.] AYES. [7.28 p.m.
Acland-Troyte, Lt.-Col. G. J. Boulton, W. W. Chapman, A. (Rutherglen)
Agnew, Lieut.-Comdr. P. G. Bowater, Col. Sir T. Vansittart Clydesdale, Marquess of
Albery, I. J. Bower, Comdr. R. T. Cobb, Sir C. S.
Allen, Lt.-Col. Sir W. J. (Armagh) Braithwaite, Major A. N. Colfox, Major W. P.
Amery, Rt. Hon. L. C. M. S. Briscoe, Capt. R. G. Colville, Lt.-Col. D. J.
Anstruther-Gray, W. J. Brocklebank, C. E. R. Cooke, J. D. (Hammersmith, S.)
Apsley, Lord Brown, Brig.-Gen. H. C. (Newbury) Cooper, Rt. Hn. T. M. (E'nburgh, W.)
Aske, Sir R. W. Browne, A. C. (Belfast, W.) Craddock, Sir R. H.
Assheton, R. Bull, B. B. Crooke, J. S.
Astor, Hon. W. W. (Fulham, E.) Butt, Sir A. Croom-Johnson, R. P.
Baldwin, Rt. Hon. Stanley Campbell, Sir E. T. Crossley, A. C.
Balfour, Capt. H. H. (Isle of Thanet) Cartland, J. R. H. Crowder, J. F. E.
Barclay-Harvey, C. M. Carver, Major W. H. Culverwell, C. T.
Baxter, A. Beverley Cary, R. A. Davidson, Rt. Hon. Sir J. C. C.
Beaumont, Hon. R. E. B. (Portsm'h) Cazalet, Capt. V. A. (Chippenham) Davies, C. (Montgomery)
Belt, Sir A. L. Chamberlain, Rt. Hn. N. (Edgb't'n) Davies, Major G. F. (Yeovil)
De Chair, S S. Jackson, Sir H. Ramsbotham, H.
De la Bère, R. Jones, Sir G. W. H. (S'k N'w'gt'n) Ramsden, Sir E.
Denman, Hon. R. D. Kerr, Colonel C. I. (Montrose) Rathbone, J. R. (Bodmin)
Danville, Alfred Kirkpatrick, W. M. Rayner, Major R. H.
Donner, P. W. Lamb, Sir J. Q. Reed, A. C. (Exeter)
Dorman-Smith, Major R. H. Lambert, Rt. Hon. G. Reid, W. Allan (Derby)
Drewe, C. Latham, Sir P. Remer, J. R.
Duckworth, G. A. V. (Salop) Law, R. K. (Hull, S.W.) Rickards, G. W. (Skipton)
Duckworth, W. R. (Moss Side) Leckie, J. A. Robinson, J. R. (Blackpool)
Dugdale, Major T. L. Leech, Dr. J. W. Ross Taylor, W. (Woodbridge)
Duncan, J. A. L. Leighton, Major B. E. P. Rowlands, G.
Dunglass, Lord Levy, T. Ruggles-Brise, Colonel Sir E. A.
Dunne, P. R. R. Liddall, W. S. Russell, R. J. (Eddisbury)
Eastwood, J. F. Lindsay, K. M. Russell, S. H. M. (Darwen)
Eckersley, P. T. Llewellin, Lieut.-Col. J. J. Salt, E. W.
Edmondson, Major Sir J. Loder, Captain Hon. J. de V. Samuel, Sir A. M. (Farnham)
Elliot, Rt. Hon. W. E. Loftus, P. C. Scott, Lord William
Ellis, Sir G. Lumley, Capt. L. R. Selley, H. R.
Elliston, G. S. Mac Andrew, Lt.-Col. Sir C. G. Shakespeare, G. H.
Emmott, C. E. G. C. McCorquodale, M. S. Shaw, Major P. S. (Wavertree)
Entwistle, C. F. MacDonald, Rt. Hn. J. R. (Scot. U.) Shaw, Captain W. T. (Forfar)
Errington, E. MacDonald, Rt. Hon. M. (Ross) Shepperson, Sir E. W.
Erskine Hill, A. G. MacDonald, Sir Murdoch (Inverness) Simon, Rt. Hon. Sir J. A.
Everard, W. L. Macdonald, Capt. P. (Isle of Wight) Smith, Bracewell (Dulwich)
Fildes, Sir H. McEwen, Capt. H. J. F. Somervell, Sir D. B. (Crowe)
Findlay, Sir E. McKie, J. H. Somerville, D. G. (Willesden, E.)
Fleming, E. L. Maclay, Hon. J. P. Southby, Comdr. A. R. J.
Fox, Sir G. W. G. Macnamara, Capt. J. R. J. Spens, W. P.
Fremantle, Sir F. E. Manningham-Buller, Sir M. Stanley, Rt. Hon. Oliver (W'm'l'd)
Furness, S. N. Margesson, Capt. Rt. Hon H. D. R. Stewart, J. Henderson (Fife, E.)
Gibson, C. G. Markham, S. F. Storey, S.
Gledhill, G. Maxwell, S. A. Strauss, H. G. (Norwich)
Gluckstein, L. H. Mayhew, Lt.-Col. J. Strickland, Captain W. F.
Goldie, N. B. Mellor, Sir J. S. P. (Tamworth) Stuart, Hon. J. (Moray and Nairn)
Gower, Sir R. V. Mills, Sir F. (Leyton, E.) Sutcliffe, H.
Gretton, Col. Rt. Hon. J. Mills, Major J. D. (New Forest) Taylor, C. S. (Eastbourne)
Gridley, Sir A. B. Morgan, R. H. Thomas, J. P. L. (Hereford)
Grimston, R. V. Morris, O. T. (Cardiff, E.) Titchfield, Marquess of
Gritten, W. G. Howard Morrison, G. A. (Scottish Univ's.) Touche, G. C.
Guest, Maj. Hon. O.(C'mb'rw'll, N.W.) Muirhead, Lt.-Col. A. J. Tree, A. R. L. F.
Gunston, Capt. D. W. Munro, P. Tryon, Major Rt. Hon. G. C
Guy, J. C. M. Nall, Sir J. Tufnell, Lieut.-Com. R. L.
Hamilton, Sir G. C. Neven-Spence, Maj. B. H. Wakefield, W. W.
Hanbury, Sir C. Nicolson, Hon. H. G. Wallace, Captain Euan
Hannah, I. C. O'Neill, Major Rt. Hon. Sir Hugh Ward, Lieut.-Col. Sir A. L. (Hull)
Harbord, A. Ormsby-Gore, Rt. Hon. W. G. Warrender, Sir V.
Hellgers, Captain F. F. A. Orr-Ewing, I. L. Waterhouse, Captain C.
Hepburn, P. G. T. Buchan- Palmer, G. E. H. Wayland, Sir W. A.
Herbert, Major J. A. (Monmouth) Patrick, C. M. Wickham, Lt.-Col. E. T. R.
Holmes, J. S. Penny, Sir G. Williams, C. (Torquay)
Hope, Captain Hon. A. O. J. Patherick, M. Willoughby de Eresby, Lord
Hopkinson, A. Pickthorn, K. W. M. Windsor-Cilve, Lieut.-Colonel G.
Horsbrugh, Florence Pilkington, R. Winterton, Rt. Hon. Earl
Howltt, Dr. A. B. Ponsonby, Col. C. E. Wise, A. R.
Hudson, Capt. A. U. M. (Hack., N.) Procter, Major H. A. Wood, Rt. Hon. Sir Kingsley
Hudson, R. S. (Southport) Radford, E. A. Young, A. S. L. (Partick)
Hunter, T. Raikes, H. V. A. M.
Hurd, Sir P. A. Ramsay, Captain A. H. M. TELLERS FOR THE AYES.ߞ
Sir James Blindell and Mr. Cross.
NOES.
Adams, D. M. (Poplar, S.) Dalton, H. Harris, Sir P. A.
Adamson, W. M. Davidson, J. J. (Maryhill) Henderson, J. (Ardwick)
Alexander, Rt. Hon. A. V. (H'lsbr.) Davies, R. J. (Westhoughton) Holdsworth, H.
Ammon, C. G. Day, H. Holland, A.
Anderson, F. (Whitehaven) Dobbie, W. Hollins, A.
Attlee, Rt. Hon. C. R. Dunn, E. (Rother Valley) Hopkin, D.
Barnes, A. J. Ede, J. C. Jagger, J.
Barr, J. Edwards, A. (Middlesbrough E.) Jenkins, A. (Pontypool)
Batey, J. Edwards, Sir C. (Bedwellty) Jones, A. C. (Shipley)
Bellenger, F. Fletcher, Lt.-Comdr. R. T. H. Jones, Morgan (Caerphilly)
Benson, G. Foot, D. M. Kelly, W. T.
Bevan, A. Frankel, D. Kennedy, Rt. Hon. T.
Broad, F. A. Gardner, B. W. Lathan, G.
Bromfield, W. Garro-Jones, G. M. Lawson, J. J.
Buchanan, G. George, Megan Lloyd (Anglesey) Leach, W.
Burke, W. A. Gibblns, J. Leslie, J. R.
Cape, T. Graham, D. M. (Hamilton) Macdonald, G. (Ince)
Charleton, H. C. Greenwood, Rt. Hon. A. McGhee, H. G.
Cluse, W. S. Grenfell, D. R. McGovern, J.
Clynes, Rt. Hon. J. R. Griffith, F. Kingsley (M'ddl'sbro, W.) MacLaren, A.
Cocks, F. S. Griffiths, G. A. (Hemsworth) Maclean, N.
Compton, J. Griffiths, J. (Lianelly) Mander, G. le M.
Cove, W. G. Hall, J. H. (Whitechapel) Marklew, E.
Daggar, G. Hardie, G. D. Marshall, F.
Mathers, G. Rowson, G. Thurtle, E.
Maxton, J. Sanders, W. S. Tinker, J. J.
Milner, Major J. Seely, Sir H. M. Viant, S. P.
Montague, F. Sexton, T. M. Walkden, A. G.
Morrison, Rt. Hon. H. (Ha'kn'y, S.) Shinwell, E. Walker, J.
Morrison, R. C. (Tottenham, N.) Short, A. Watkins, F. C.
Muff, G. Simpson, F. B. Watson, W. McL.
Naylor, T. E. Sinclair, Rt. Hon. Sir A. (C'thn's) Welsh, J. C.
Oliver, G. H. Smith, Ben (Rotherhithe) Westwood, J.
Parker, H. J. H. Smith, E. (Stoke) Williams, D. (Swansea, E.)
Pethick-Lawrence, F. W. Smith, Rt. Hon. H. B. Lees- (K'ly) Williams, E. J. (Ogmore)
Potts, J. Smith, T. (Normanton) Williams T. (Don Valley)
Price, M. P. Sorensen, R. W. Wilson. C. H. (Attercliffe)
Pritt, D. N. Stephen, C. Windsor, W. (Hull, C.)
Quibell, J. D. Stewart, W. J. (H'ght'n-le-Sp'ng) Woods, G. S. (Finsbury)
Richards, R. (Wrexham) Strauss, G. R. (Lambeth, N.) Young, Sir R. (Newton)
Ritson, J. Taylor, R. J. (Morpeth)
Robinson, W. A. (St. Helens) Thorne, W. TELLERS FOR THE NOES.—
Mr. Whiteley and Mr. Groves.