PRICE OF COAL.

HC Deb 20 March 1912 vol 35 cc1993-2005

Mr. THOMAS RICHARDSON

I beg to move, "That this House regrets the action recently taken by owners and middlemen in raising the price of coal to consumers for no other reason than to take advantage of a national crisis for securing inflated profits at the expense of the general community, and considers that this exploitation of the public is a motive inducing sections of the employers to resist the reasonable demands of the workmen; and, further, this House is of opinion that a Committee should be appointed to consider and report how in future the general community can be protected against such action."

The speakers who took part in the discussion about the Navy without exception claimed that the subject was one of very great importance, and that the people of this country were very much interested in it. I am not called upon to give any expression of opinion as to the accuracy of that statement, but I venture to submit that there is probably no question occupying the attention of the people of this country to-day that is of greater importance than the question of the cost of coal. On the official Amendment to the Address of the Labour party, with whom I am associated, and in the speech of my hon. Friend the Member for Leicester (Mr. Ramsay Macdonald), I find the following:— Finally, we cannot allow an increase of wages to be merely a means of the further exploitation of the general public. I desire to improve upon that, and to suggest that my Resolution protests against the system of exploitation of the British public even in the absence of any increase in the wages of the people of the country. As to the facts of the case I imagine there can be no disagreement in this House. The price of coal, not only for household purposes but for manufacturing purposes, is to-day at what is spoken of as famine figures. I believe that it is generally concluded that coal in this vast Metropolis is sold at the highest price in the markets of the country. We are all familiar with the fact that even before the miners ceased to work famine prices were obtaining in the City of London, and that to-day coal is being sold at £2 per ton and upwards. I think, so far as small consumers are concerned and people whose income is precarious and very limited indeed, that it would not be going too far to say that even so much as £2 10s. is being charged for household coal in London. I desire to call the attention of the House to the fact that whilst the price is excessively high, extortionately high, in this great centre of population and of industry, that the relative increase in the cost of coal is higher even in our mining villages than it is in our large centres of industry and population. I have been at some pains to take some returns as to the cost of coals. I find that taking some of the towns and villages in the heart of our large mining districts, the price of coal is substantially higher. Take, for instance. Doncaster. In the last few years there has sprung up round about the town of Doncaster a mining industry which is full of possibilities of development, and yet in Doncaster, in the centre of one of the richest coal fields of Great Britain, the cost of coal since December last, has gone up by upwards of 100 per cent. The same is true of some of our mining villages. Take, as a typical instance, a mining village in Scotland. In December last, in anticipation of the strike coal had risen something like 2s. a ton, and at the present time it is being sold at 19s. or 20s. a ton. Further, the cost of coal for domestic purposes in normal times has gone up during the last thirty years by from 60 to 100 per cent. Nobody will suggest that the miners have received from 60 to 100 per cent, increase in their wages during those thirty years. During the present serious industrial dispute strong indictments have been levelled against the miners on the score of selfishness. I claim on behalf of the party with which I am associated that when in this House or in the country we discuss industrial and economic questions, our outlook is not confined to the interests of the wage-earning section of the community. In the present extortionate prices charged for coal for domestic purposes we have a most striking illustration of one of the facts of modern economic conditions that is forcing itself upon the attention of the British public; that as a result of the growing power of the modern capitalist the general public are being compelled to face the fact that they are just as effectively exploited, and are largely as helpless to protect themselves as others against the almost unlimited power of capitalism as we find it to-day. The general public have a very substantial interest in the question, and we are serving the best interests of the public when we call attention to these facts in Parliament. What is true of the household buyer is also true in relation to the corporate life of the nation. From inquiry I find that the London County Council are to-day paying 25s. per ton for coals that they were able to buy as per contract prior to the dispute at something like 11s. per ton—with this important difference, that the quality is inferior, thus making the price higher still. As recently as Monday of this week an instruction was conveyed to the county council that instead of 25s. they would have to pay 30s. for their next supply. Within the past few days I was speaking in the precincts of this House with an employer of labour, a member of a firm in this city, who told me that whereas their contract price for coal was 11s., even a month ago he was compelled to pay 25s. a ton for coal of an inferior quality to that at 11s. Any system, we submit, that permits those that own, enjoy, and exercise the power to inflict injustice and injury not only upon the wage-earners of the country, but to exploit the British public has been weighed in the balances and found wanting, and is a subject demanding the earnest consideration of Parliament itself.

The Resolution goes on to say:— regrets the action recently taken by owners and middlemen in raising the price of coal to consumers for no other reason than to take advantage of a national crisis for securing inflated profits at the expense of the general community, and considers that this exploitation of the public is a motive inducing sections of the employers to resist the reasonable demands of the workmen. I do not intend to labour this point further than to assert that while I am not in a position to prove it to the House in the way that one demonstrates that two and two make four, I am certain in my own mind, and I believe there is a large body of opinion outside this House that endorses that opinion, that but for the fact that large employers of labour and mine owners and the men who are spoken of in the Resolution as middlemen controlling large supplies of coal, and the power they so ruthlessly exercise, there would have been a hopeful possibility of the present dispute being brought to a successful issue before now. We submit, that if what our Resolution says is correct, we are entitled to ask the House to register its protest against that condition of things. The Resolution then suggests that this House is of opinion that a Committee should be appointed to consider and report how in future the general community can be protected against such action. I want especially to urge the importance of this part of the Resolution. Surely it is the duty of Parliament itself, having had brought to its notice that the people of the country, irrespective of their social position, of their craft or trade, irrespective of whether they be of the lower or middle or the upper classes, are helpless to protect themselves against the exploitation to which they are subject to-day, to interfere, and that is sufficient justification for us not only to enter our protest against that fact and call the attention of the House to it, but to suggest in all seriousness that there ought to be appointed a Committee to ascertain the facts, and, in the fulness of time, to bring them home to the House itself, so that in any future struggle of a similar category, which we hope may never occur, but in the event of any such industrial catastrope happening in our lifetime, in the future we ought to be prepared, in the interests of the public, with sufficient safeguards to protect them against repetition of this exploitation. I close by emphasising and urging upon the attention of the House the fact that in our mining villages and towns right in the heart of the centre of the mining industry, not only the general public, but the miners, in need of coal for domestic purposes, are being charged extortionate prices, and that the mine owners, not all of them, and the middle men, not all of them, but those who represent the large capitalists concerned and who have very largely dominated the coal strike, have, with ruthlessness and without any regard to the best interests of the working classes of this country in particular, not hesitated to exercise that power which, in the judgment of the Labour party, they ought never to enjoy, and which, sooner or later, this House itself must seek to take away from those people who to-day enjoy it at the expense of all that is best in our industrial and our national life.

Mr. HODGE

I beg to second this Resolution. This proposal may be divided into three parts—(1) regret that the coal owners and middlemen have exploited the public; (2) that they have a motive for causing strikes because of that exploitation; and (3) the necessity of setting up a Committee of Inquiry to see in what manner the public can be protected. I think that the word "regret" in this Resolution is much too mild, and we might have condemned the coal owners and middlemen for their exploitation, of the public during the present crisis. The section of the community who have suffered most are the poor people who have to buy their coal in small quantities. They are the class who have been robbed to the greatest extent. We all know that even if they had the cash they have not the accommodation necessary for storing coal in large quantities. We have been told, particularly by one section of the Press, that the coal strike, is a selfish strike. [An HON. MEMBER: "Hear, hear."] What about the selfishness of the coal owners and the middlemen, who have exploited the public during the crisis? We do not hear a single word about the selfishness of the royalty owners. Surely, with the £6,000,000 a year they receive for doing nothing, they might have come forward at the present crisis in order to ease the situation. That is one method the Government might have adapted as something by way of solving the difficulty. Then there is the fact that whilst the price of coal has been enormously increased there has been no extra cost so far as wages are concerned. This exploitation has not only affected the poor people, but the industries of the country have been hampered and harassed as a consequence of the great increase in the price of coal. We know that in South Wales, the district which has offered the greatest barrier to a settlement of the present difficulty, the owners have fomented strikes in the past because of the rubbish they have accumulated on the pitheads which they have been able to get rid of during a strike at large prices. These are facts of common notoriety, and I hope the Government may be able to do something by way of settling the difficulty in the direction of protecting the community from these hardships in any future crisis which may arise.

Mr. PIKE PEASE

Though I was not aware this Motion was really to come on to-night, I should like, as one who has been interested for many years in the coal industry, to make a few remarks in reference to it. It does not seem to have occurred to the Mover and Seconder of the Resolution that it might be possible that the high prices in coal at the present time are due to the ordinary laws of supply and demand; and, as far as any other industry in the country is concerned, if there was the same demand there would be the same increase in the price. I have been interested lately in the correspondence which has appeared in the "Times" in reference to coal profits, especially in the case of Messrs. Bell Brothers, of Liverpool. Sir Hugh Bell has been writing to the Press with regard to these statements as to coal profits. A good many statements have been made that those profits are exceptionally large, permitting in the case of Messrs. Bell Brothers in the ordinary shares of the payment for a certain period of dividends of 28 per cent. It is very easy through figures to prove almost anything, but Messrs. Bell Brothers are an iron making firm and every ounce of coal they raise is used in their ironworks.

Mr. THOMAS RICHARDSON

May I respectfully ask if the hon. Gentleman suggests that the larger margin of profit is made on their ironworks and not on their coal?

Mr. PIKE PEASE

I was going to say that as Messrs. Bell Brothers happen to have ironworks as well it is impossible to say the whole profit is made out of coal. I would like to say if it is not egotistical that the firm with which I am connected in the year ending April, 1910, to take an ordinary year, turned out of their collieries and limestone quarries over 3,600,000 tons of material, and the average profit on that, after taking into account the ordinary expenditure and depreciation, was 4.6d. per ton. Though that seems a small sum, we made a very considerable amount of profit owing to the fact that we have methods of treating the coke and by-products. I would suggest that the high price lately paid for household coal has been caused by the fact that there has been an enormous demand for it owing to the action of the miners themselves, and I am perfectly certain there is no hon. Member sitting on that side of the House who does not agree with me. I have also a right to ask them if they can find any method by which the ordinary laws of supply and demand would not act in a similar case. It is perfectly true, as far as household coal is concerned, that the middlemen are making very large profits at the present time. There is no doubt many of them foresaw the strike, bought large quantities of coal forward, and then when the demand became intense they sold it at a very high price; but that has not been the case as far as the coal owners with whom I am connected are concerned. In South Wales the coal owners have contracts on their books now for over 20,000,000 tons, and in Durham in ratio to the amount they supply there are the same large sales forward. It is not realised by ordinary people who take an interest in this question that household coal is a small matter compared with the supply for industries. A blast furnace uses as much coal in a week as a town of 50,000 people. It takes about twenty-two hundredweight of coke to make a ton of iron, thirty-two hundredweight of coal to make a ton of coke, and about one and a quarter ton of iron to make a ton of steel. Therefore if the minimum wage decreased the output in this country, and there was an increase in the cost of coal, that would mean not less than from 1s. to 2s. per ton on iron and from 3s. to 4s. per ton on the cost of steel. I am one of those who very much regret that the poor should have to pay so high a price for coal at the present time, but, as far as I can see, that has been caused entirely by the extraordinary demand which has arisen, and when we consider the position of England to-day, when we consider the amount of stock used during the last three weeks we can realise the extraordinary demand there must have been. I for my part cannot see how any committee which can be appointed can possibly find any means by which the price would not increase very considerably when the demand itself extends, and although I should like to know what method might be adopted in regard to that, I personally do not see how one can expect the price to remain low. Then I come to the question of royalties. It is a very difficult question as far as royalty owners are concerned. The increased price of coal has not increased the amount of money they have obtained for their royalties. In very few districts is there a sliding scale in regard to royalties, and therefore the increased price of coal during the last few weeks has not enabled the royalty owner to obtain more for his coal than previously. Hon. Gentlemen opposite may not agree with my views on royalties. As a member of a firm which pays very large sums for royalties, I confess I should like to get the coal for nothing. But suppose a man pays £100,000 for a coal area. It seems to me he has just as much right to charge 4½d. per ton for his coal as a man has to charge for the cabbages he grows in his garden. If a man has bought property which contains coal, what right has any other man to take that property from him without paying for it the ordinary market; price? I should like, in conclusion, to say I believe that the increased price of coal, which will have to be paid by the poorest of the poor in the country, will have been caused by the action of the miners. As far as the price is concerned, the benefit is chiefly reaped by the middlemen in view of the fact that coal owners in the country nearly always sell their coal forward—three months ahead. Therefore very little of the profit will go to the coal owner.

The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. J. M. Robertson)

The hon. Member who last spoke has broadly indicated the acknowledged facts which make it impossible for us to accept this Motion. While accepting in the main his economic argument, I should like to make a qualification on one point. In regard to mining royalties the hon. Member takes the stand of the right of man to do as he likes with his own property. I do not think anyone here is proposing to interfere with that right, but the hon. Member is no doubt aware that there is a very large section of people who maintain that property of that kind is a legitimate subject for special taxation. It has been so treated in the recent past, and it is just conceivable, in the future, that the increasingly general view that that form of property is a windfall may result in further taxation. So broadly does this form of property differ from others that, as the hon. Member is probably aware, in the German Empire, in the Middle Ages—

Mr. PIKE PEASE

I was not referring to that question at all. I quite realise that royalty owners do pay taxation. They have paid Income Tax. That was not my point. My point was that there is no sliding scale in regard to royalties, and that the royalties have no reference to the price of coal at the present moment.

Mr. ROBERTSON

If the hon. Member means that royalties do not enter into the price of coal, I quite agree with him. A royalty is an economic rent.

Mr. WEDGWOOD

No, it is not.

Mr. ROBERTSON

It is a form of economic rent, as regards which there is, at least, a very considerable difference of modern opinion. I was remarking that in Germany, in the Middle Ages, all minerals from the soil were made the property of the State, a course of action which some people wish had been taken in our own case. That is not going to be made up for by any act of confiscation. I merely wanted to avoid seeming to endorse what the hon. Member (Mr. Pike Pease) said on that point, while I agree with his general answer to the Mover and Seconder. With regard to the Motion itself, I confess I am a little surprised at the surprise my hon. Friends expressed. It would seem as if the rise in the price of coal, following upon the announcement that a strike was imminent—an announcement made long before the strike took place—came as an unpleasant surprise to my hon. Friends. That surprise it is that surprises me. I should have thought that the promoters of a general strike would count upon a great rise in the price of coals as a means of making the strike work. If prices were not to rise I do not see how the strike would have had the effect they desired. I do not for a moment seek to bandy those charges of selfishness which have been flung between the representatives of the miners and the representatives of the coal owners, The broad fact is that any business man, in the position in which the colliery owners found themselves when the strike was regarded as imminent, would have raised the price because of the demand. As soon as there was a risk of scarcity many private persons and public institutions began to ask for more coal. The mere rise in the demand in all quarters will invariably raise the price of any commodity.

I do not know what my hon. Friends have in mind when they suggest that there might be a method of checking, or preventing, or breaking this rise in price. I could quite understand that in the case of a, "ring" or a "corner" in which some necessity of life has been cornered by speculators, with the effect of artificially raising the price to all, many of us would like to break the "ring." I could understand hon. Members speculating as to how the "ring" might be broken, and suggesting, perhaps, legislative methods for doing so. But in this case there has been no "ring." The Mover showed that prices have risen in a most astonishing way, and that they have risen far more in the colliery districts than in London; a fact I can only explain, speculatively, by saying that the London dealers must have had greater reserves or longer contracts. Supposing there is no "ring" or "corner," how can you hope to check the rise in prices? Suppose you had a dictatorship at work and the dictator knew that a strike was coming on and saw prices rising, as they invariably would rise by reason of the alarm of the private consumer as well as big institutions, companies, and so on. Suppose the dictator said, "The colliery owners shall not raise the price of his coal at the pit mouth," and suppose he was able to enforce that, the middleman would get it at his former price. The dictator would then have to say, "The middleman shall not raise his price," and, further, he must say that the middleman shall sell to anyone who comes to him to buy and every private person who wants to have a great store is to be allowed to get it exactly as he orders it. If hon. Members will think out the sequence they will see that the scheme must break down.

Mr. JOWETT

Is the hon. Gentleman aware that municipalities have not raised the price of coke notwithstanding the extra demand?

Mr. ROBERTSON

I do not understand the circumstances and cannot pronounce an opinion, but if the price of coke has risen in the general market, and the cooperative societies have not raised it, that may be regarded as an act of beneficence or of charity on their part towards the general public. The price of coke has risen. The latest price lists I have seen show some rise. But this is more or less irrelevant. The broad fact is that the prices of coal in this case have risen in an absolutely natural and inevitable way. Hon. Members have suggested no scheme whatever, no possible way in which any political machinery could prevent that rise of prices. The Motion only suggests first that prices have been raised for no other reason than to take advantage of a national crisis, for securing inflated profits at the expense of the community—that is to say, that prices have risen for no other reason than that they could be got, and I do not know of any other reason than that which could be given for any rise of prices. Then the Motion goes on to suggest that the "House is of opinion that a Committee should be appointed to consider and report how in future the general community can be protected against such action." As I myself am destitute of any idea as to how the community could be protected against such action and know no one who has any such idea, and as the Mover and Seconder have not suggested any scheme, but just left the House to express an opinion in regard to the appointment of a Committee, I can only say that to me the suggestion is idle, and I do not see how the House could rationally accept it.

Colonel HICKMAN

One would imagine from the speeches of the Mover and Seconder that this strike has been engineered by the coal owners in order to exploit the price of coal. It does not appear to me to be evident on the face of it. Because the price of coal has gone up it is perfectly ridiculous to suppose that the coal owners worked the strike for that purpose. It is evident to everyone who has any idea of business that it has been a very bad thing for the coal owners. An hon. Member just now remarked that the price of coke had not risen. I speak rather feelingly because the firm to which I belong had to pay double the price to put coke into their blast furnaces last week.

Mr. JOWETT

May I correct the hon. Member? What I said was that the municipal authorities had not raised the price of coke, notwithstanding the extra demand, and that if coal were nationalised the same result would follow.

Colonel HICKMAN

I can assure the hon. Member that the coke we buy from the municipality has been increased in price.

Mr. JOWETT

That is an exception.

Colonel HICKMAN

The hon. Gentleman who moved the Resolution did not appear to be aware that when the collieries are standing there is always going on the interest on the capital expenditure. If the mine owners cannot get any money as the price of coal which is not raised they have to think of paying the interest on the money which has been invested in the mines. That is only one of the reasons why the price of coal should go up if they can get a higher price. The hon. Member (Mr. T. Richardson) said there had been no rise in wages for the last twelve years. I am of opinion that wages have been advanced something like 40 per cent.

Mr. T. RICHARDSON

The hon. Member is misrepresenting the statement I made to the House. I said that the price of coal for domestic purposes had gone up on the average from 60 to 100 per cent. in the last twenty years.

Colonel HICKMAN

I think it will be in the recollection of the House that the hon. Member said that wages had not risen. I repeat that wages have risen something like 40 per cent. in the last twelve years, and under these circumstances I cannot see why there is any reason to have any special Committee to inquire into the matter.

Mr. POINTER

I do not know that I am altogether surprised at the speech of the hon. Gentleman who has defended the Government position or 1hat of the hon. Gentleman opposite (Mr. Pike Pease). I can quite understand the point of view of the hon. Gentleman who represents Darlington, because evidently he is in the position of belonging to that class of society—I say this with all friendliness and without any suggestion of meekness— who think that the exploitation of mineral wealth is a natural thing, but I cannot exactly understand his parallel between the man who has a cabbage in a field and another man who has mineral wealth below his land. The fact that there is a cabbage growing in the field suggests that there has been some labour attached to it.

Mr. PIKE PEASE

If a man pays £100,000 for an area of land in order to own the coal under the land, has he not the right to the coal?

Mr. POINTER

That is true, but it does not get down to the fundamentals. The mineral wealth of the people should belong to the people. No person should have the privilege of getting into his own possession that which should belong to the whole nation. It seems to me that if a man buys land in the way stated he does it with his eyes open, and he should take the consequences if on a change of public opinion he finds out that public opinion declares that what In the past was a right and proper thing is no longer going to be tolerated. I do not think that personally he has any grievance. All I want to say is that so far as we can see the whole thing is a matter of system. Everything the hon Gentleman opposite has said is true so long as the present system obtains, but the object of the proposed Committee is to see whether another system would not be more beneficial.

And, it being Eleven of the clock, the Debate stood adjourned.