HC Deb 09 March 1915 vol 70 cc1271-97
The CHANCELLOR of the EXCHEQUER (Mr. Lloyd George)

I beg to move, "That leave be given to introduce a Bill to amend the Defence of the Realm Consolidation Act, 1914."

The House will agree that it is vitally important to this country that we should increase the output and every facility for the output of munitions of war. The duration of the War depends upon it, and I think the success of the War depends upon it. We took powers in the Defence of the Realm Act, 1914, to take over and exercise control over any works where war material was being actually produced. We now seek to take powers in respect of works where war material is not being produced at the present time, but which are capable of being used for that purpose. There is no doubt that by organisation it would be possible to utilise a good many works which, at the present time, are turning out engineering material of one kind and another for the purpose of extending and enlarging our output of munitions of war. We are not doing so because we have experienced any difficulty with any individual employer or workmen, but, at the moment, when we propose a very considerable extension on these lines, we think it is better even for the employers that it should be done in obedience to an Act of Parliament rather than at a request from the Government, because those that are limited liability companies especially have to consider their shareholders, and they have responsibilities to them, and they have also to consider their trust deeds and articles of association, and there are diffi- culties of that kind which can only be overridden by the express direction of an Act of Parliament. We have, therefore, proposed to take these statutory powers, not because we anticipate difficulties with employers, but purely and simply in order to enable employers themselves to get over difficulties which they might otherwise experience.

Therefore, the Bill which I am asking leave to introduce at the present moment is a Bill to extend the powers which we already possess in respect to firms and factories turning out war materials. We propose to extend those powers to firms and factories which are not being used for that purpose, but which we hope to use and use very soon. There was some doubt as to what the position of an employer would be in these circumstances, where he had entered into a contract for the supply of that particular commodity he was turning out. Take motor works, for example. There are several motor works at the present time which are turning out war material, and we hope that many works of this kind will be used for that purpose in the immediate future. Suppose they were under a contract to deliver, say, 1,000 motors. If the Government took over the works for the purpose of making War material, they could not carry out their contract. I believe under the common law they would be exonerated from any liability, but, in order to put it beyond any doubt, we propose to insert a Sub-section in this One-clause Bill for the purpose of protecting them against such consequences and their inability to carry out their contract because they are devoting their works to assisting the Government in the turning out of war munitions. That, I think, includes every point which we propose to invite the House to legislate upon. I should very much like, if the House would consent to it, to get this Bill through in the course of to-day, because we wish to make arrangements at the earliest possible moment for these very large extensions of the arrangements we have made for increasing the output of munitions of war. As I am going to ask the House to do this to-day, perhaps hon. Members would allow me to read the Bill itself. It is as follows:—

"Be it enacted by the King's Most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

1.—(1) Sub-section (3) of Section one of the Defence of the Realm Consolidation Act, 1914 (which gives power to take possession and use for the purpose of His Majesty's naval and military services certain factories or workshops or the plant thereof), shall apply to any factory or workshop of whatever sort, or the plant thereof; and that Sub-section shall be read as if the following paragraphs were added after paragraph (b):—

(c) to require any work in any factory or workshop to be done in accordance with the directions of the Admiralty or Army Council, given with the object of making the factory or workshop, or the plant or labour therein, as useful as possible for the production of war material; and

(d) to regulate or restrict the carrying on of work in any factory or workshop, or remove the plant therefrom, with a view to increasing the production of war material in other factories or workshops; and

(e) to take possession of any unoccupied premises for the purpose of housing workmen employed in the production, storage, or transport of war material.

That is a difficulty which we have already experienced in regard to some of our arsenals. That point seems to have been forgotten. It would increase the output if we could house the workers in that particular neighbourhood, and it is absolutely necessary that we should have those powers.

(2) It is hereby declared that where the fulfilment by any person of any contract is interfered with by the necessity of complying with any requirement, regulation, or restriction of the Admiralty or the Army Council under the Defence of the Realm Consolidation Act, 1914, or this Act, or any regulations made thereunder, that necessity is a good defence to any action or proceedings taken against that person in respect of the non-fulfilment of the contract so far as it is due to that interference.

(3) In this Section the expression "war material" includes arms, ammunition, warlike stores and equipment, and everything required for or in connection with the production thereof.

2.—This Act may be cited as the Defence of the Realm (Amendment), No. 2, Act, 1915."

I trust the House will enable the Government to get this Bill at the earliest possible moment, in order to enable us to proceed with the plans of the War Office and the Admiralty in order to increase the output of munitions of war.


The Attorney-General kindly gave me a copy of this proposal yesterday, and I have, therefore, had an opportunity of considering is. I wish to say at once that the powers which are now demanded are probably the most drastic that have ever been put to any House of Commons. They enable the Government to go to any factory and tell them what they are to make and what they are not to make, or to go to any factory and tell them that their machinery is not being employed to the best advantage, and that we are going to take it away and use it for another purpose.


For war material.


They are tremendous powers and powers which, if abused, would do incalculable harm to the industries of this country. If they were abused even from want of consideration—which I do not expect—or through not completely understanding the circumstances of the factory, they would do great harm. At the same time, I am not prepared to offer any opposition to the proposal of the Government or even to the suggestion that it should be carried through in the rapid way the right hon. Gentleman has proposed. I have said before in this House, and I think strongly that, in a crisis such as that which exists now, there is only one thing we can do: We have got to make the Government more or less dictators and to trust them to do what is wise in this matter and give them full power to use to the utmost all the resources of the country, including the industrial resources. I say, without hesitation, that there is one point which I have not looked into which I think ought to be considered, and that is the question of compensation. Perhaps it is dealt with in the previous Act. If so, I have nothing to say, but before we come to the Committee stage I do think that we should make sure that the powers are not being used unfairly and that proper compensation will be given if the powers are exercised. I say that we are all ready to give the Government the powers for which they ask, but I feel it right to say that this Bill, more particularly the way in which it is being introduced, does cause me a great deal of anxiety. We have been sitting now for two months, we have not been very busy, and the fact that the Government come on almost the last day of these sittings and ask us to rush it through in this way suggests that even the most vital things are being done in a casual way which does cause some ground for anxiety. That, at all events, is how it strikes me.

There is a more serious side even than that. I said, speaking in this House last Monday, that I had some doubt whether in one respect the Government were doing everything that they could to end this War. I expressed the doubt—I had no knowledge then, and I have none now—whether we had a shortage of ammunition or of other munitions of war, and I said that if after seven months of war in a country like this, which is the greatest manufacturing country in the world, and where there is immense power of adapting one form of manufacture, to another, there was that shortage, then I did not think that the industries of the country had been used to the greatest advantage. I cannot understand why, if this Bill is necessary to-day, the necessity for it could not have been foreseen in August or September, and why it should not have been introduced then. I hope that the Government will give me credit for believing that I do not wish to embarrass them and that I am much more anxious about what can be done now than about what has been left undone in the past; but I do think that we have not mobilised the industries of the country in the way in which it was possible to mobilise them for the purposes of this War. Let me, if the House will permit me to do so, give an account that was given to me by a French friend of the way to which the industries of France were mobilised at the outbreak of War. The whole country was divided into districts, and every factory in each district was considered from the point of view of the use to which it could be put for supplying munitions of War. The result has been to my knowledge—at least I was so informed—that they have been increasing the output of high explosive ammunition, for instance, seven times. Works not in the least adapted for it were at once turned to that purpose, and I am informed—I can repeat it, because it was not told me officially—that the Renault Motor Works in Paris are turning out something like 3,000 rounds of high explosive ammunition per day. I see no reason why the same thing could not have been done in this country. If there is going to be any shortage of this kind of thing, and if the Government are going to depend to an extent which is not necessary on what we can buy from other countries, then—I am sure that the Chancellor of the Exchequer feels it as strongly as I do—we are really running as great a risk of failing in this War as if we made every possible mess in the conduct of our Fleet or our Army. It is not enough for the Government to take these powers; what they have got to do is to utilise them.

I am going again to repeat an old complaint which I think is well founded, and that is that the Government have not utilised and are not utilising now the organising capacity of the business community of this country to get the best results in cases of this kind. The complaints I have hitherto made have been in regard to waste of money. I think even now that the waste of money is of some importance, and it will be of big importance when the War is over. But, after all, that is not the main thing. The question we are considering now is far more important than the waste of money, and I at least am convinced that- if the Government attempt, either through the head of the War Office—I have shown by what I have said in the House that no one has greater admiration for Lord Kitchener than I have or a greater respect for the services which he has rendered his country—or merely through ordinary officials to utilise this industry we will not get the best results. In my belief the only people who know from experience and training what can be done by our manufacturing industries are the people who are connected with them; and, if I may, I would like to correct what from conversation I believe to be a general feeling among Civil servants and among politicians. The feeling is that if you employ a business man engaged in the trade, he will try to make money for himself and his friends. That is a natural feeling, but I think that it is wrong. I am sure that if you simply deal with them as merchants they will try to make what they consider to be a reasonable price, but what other people may consider to be more than a reasonable price, but, on the other hand, the one thing of which I have been convinced in the whole of my experience through life is that if you trust people in nine cases out of ten they will not betray you; and in the same way, if you will take into your confidence the people connected with the manufacturing industries of this country and tell them what you want, I believe that you will get better results and that you will find that you will get them at less money. I think that it is a pretty strong thing to ask us to rush this Bill through in one day; yet since the Government are going to act upon it, I think that we should give them what they want and allow it to go through in that way.


This Bill is brought in under "the Ten Minutes' Rule," and I must assume, for the purposes of order, that the right hon. Gentleman's speech was one in opposition to the Bill.

Question put, and agreed to.

Bill ordered to be brought in by the Chancellor of the Exchequer, Mr. McKenna, and the Attorney-General. Presented accordingly, read the first time, and ordered to be printed. [Bill 44.]

Order for Second Reading read.

Motion made, and Question proposed, "That the Bill be now read a second time."


On the Second Reading, I would like to say one word by way of reassuring the House after some of the observations which have fallen from the right hon. Gentleman the Leader of the Opposition. It certainly is not proposed to run this without full consultation with all manufacturers. The idea is that they should be summoned together, and summoned together in their district, and that we should take them into consultation. It is possible that we could get a business man at the head of the organisation. We are on the look out for a good, strong business man with some go in him who will be able to push the thing through and be at the head of a Central Committee. Then we propose to take all the manufacturers concerned into full consultation. We do not anticipate any real difficulty, but still it is much better to do as this Bill provides in the event of some manufacturer proving refractory and making it very difficult for others to come in because he stops out. We propose to organise the whole of the engineering community for the purpose of assisting us in increasing the output, and I am perfectly certain we are going to get the assistance, the willing assistance, of them all. I quite agree with the right hon. Gentleman that when we appeal to their sense of patriotism, they will respond. When we point out to them that it is not a matter of profit but a matter of the urgent need of their country, I am sure they will render every assistance in their power.


The speech of the Leader of the Opposition is an illustration of how trustful we are, as far as the Government is concerned, in the promotion of these Bills. We on these benches ought not to be very much concerned at the rushing through of Bills of this character because it gives effect to the contention of many of my Friends regarding collectivist effort. I am conscious of the fact that the Government have already taken over works which are engaged in the manufacture of munitions of war. I also know there are various other firms which are extremely anxious, from patriotic motives, to help the Government. I had an interview only the other day with a large firm who are very anxious in that direction. They find that men are so scarce that they have asked us to enter into arrangements with them so that the men should work twelve hours instead of eight, and thus not only help the firm but also help the Government. The men have very readily responded to that request. While, gene rally speaking, we approve of the desire of the Government to do what they propose to do in this Bill, may I say, as evidence of its necessity, that within a mile of this Chamber there is a large engineering establishment which could be employed in the manufacture of munitions of war, but which is busily doing nothing but manufacturing printing pressed. When one considers the general cry there is with regard to the lack of skilled artisans who can assist in turning out the armaments necessary for the defence of the country and for the arming of the men in training, that state of affairs is a disgrace to the people responsible, and it emphasises the point made by the Leader of the Opposition with regard to trained business men being brought together for the purpose of helping the Government in this particular direction. May I go a stage further, and say it is as essential that representatives of working men conversant with these things should be consulted as that business men should be.

There are one or two dangers connected with this matter which I desire to put before the Chancellor of the Exchequer. Assume that certain works are taken over where hitherto the conditions with regard to wages have not been up to the standard of the district. In the event of the Government taking these works over, will they see to it that the wages are at once brought up to the standard paid by the surrounding competitors? That is very essential if there is to be that harmony in these particular works which ought to exist. I should like the Government to do it without too much red tape. I am sorry to say that at the present moment a great deal of the unrest and agitation amongst the workers engaged in the manufacture of munitions of war is due, not only to red tape, but to unconscionable delays in settling differences. I can speak from personal experience on this point, as two months ago I made a complaint about a Leeds firm who were not complying with the Fair-Wages Resolution of this House, yet nothing has been done to compel that firm to toe the line.

I could give various other instances, but that is one simple demonstration of how unrest is caused. I know that those responsible for guiding working men have had an immense amount of worry and trouble in keeping men at work, and hon. Gentlemen will, I am sure, accept my assurance that there is not one of us on these benches who has not, from purely patriotic motives, been doing everything that is possible to minimise these troubles and to urge upon the men that it is not right because an employer does wrong that they also should do wrong. We have tried to impress upon them the necessity for realising that their wrong-doing is going to cause injury to their comrades who are at the front. I hope, therefore, that when the Government take over these works they will show a little more energy and a little more speed in reconciling any differences that may arise. I trust, also, that what I have said will impress itself on the mind of the Chancellor of the Exchequer, and that the difficulties I have mentioned will be met in the way I have suggested.


I fear it will be found that the Bill is somewhat defective so far as breaches of contract are concerned. Every manufacturer in the country is, at some time or other in the course of his trade, dependent on engineering shops, and I think there should be some provision in this Bill so that, where there is a genuine defence, an action for breach of contract should not be commenced in face of the fact that the Government have taken over the works. On the other hand, the ordinary customers of the works are also entitled to some little protection. It may be that only a portion of the works may have been taken over. The customer may have ordered goods as from 1st of March, whereas the works may not have been taken over until the 1st of April, and, in a case like that, it might be that an unsatisfactory excuse for non-fulfilment of contract might be put forward.

4.0 P.M.

Questions as to breach of contract will inevitably arise out of the passage of this Bill, and I fear that the Government have scarcely given that point sufficient consideration. I would suggest that when any shops or works are taken over by the Government they should be scheduled in some Government Department, and that persons who have had business transactions with the shops or works shall be able to learn when the shop or works were scheduled, at what date they were actually taken over, and until what date they were required. If they are not taken over for the whole duration of the War the customers should be entitled to say, "You are only taken over for a certain period, and you did not begin on my job in proper time." These are matters which are likely to lead to a great deal of litigation if the Government find it necessary to take works over to any great extent, and trouble will arise unless some definition, such as I have suggested, is laid down. I would, therefore, suggest to the Government the insertion of a provision for scheduling the works, showing the date upon which they have been taken over and the probable duration of the time they will be required. With regard to works generally taken over, if contracts are broken the person whose works are taken over ought not to be subjected to litigation such as might arise without leave being obtained for it. It would be a monstrous thing if the Government seized certain works and some customer—everybody is not reasonable—should have power to launch an action for breach of contract. The person so attacked should have the power to take the writ off the file, or the Government ought to provide that litigation should not be commenced against a person whose works were taken over. As the Bill is necessary I do not oppose it, but on the legal side some further consideration is necessary.


I would ask the Chancellor of the Exchequer if he will reconsider his decision with regard to the passing of this Bill though all its stages this afternoon. The Government cannot complain of the attitude of the House in regard to rapid legislation, for it has been very acquiescent. There is a certain danger in absolutely blindfold legislation, and it is quite impossible to appreciate the far-reaching nature of a measure of this sort by only listening to the speech of the right hon. Gentleman. If the Chancellor of the Exchequer will allow us to have the Bill in our hands and to pass it through the remaining stages to-morrow, we should be able to appreciate much better the extensive character it seems to possess. One of the results of the Bill, so far as I can see, would be that in all the works that are taken over by the Government the employés would be placed under military law.


No, there is certainly nothing approaching that. I read the Bill out and there is not a single provision in it which would justify that statement.


It was very difficult to follow exactly, but it appeared to me that the employçs would become Government employés. There may be a certain amount of misunderstanding on points of this sort, and I would ask the Chancellor of the Exchequer if twenty-four hours' notice could not be given, so that we may have the Bill again before us to-morrow.


I did not intend to oppose the Bill for two reasons, first, because my right hon. Friend the Leader of the Opposition has given it his sanction, and, secondly, because I do not quite know what the Bill does. But I do wish to raise a protest against this method of bringing in legislation. The right hon. Gentleman could perfectly well have made the speech he has made to-day at the beginning of business yesterday. Then the Bill could have been printed yesterday, we could have seen it to-day, and it could have gone through all its stages. It is quite impossible for any Member of this House listening to what the right hon. Gentleman said—I am not saying he did not speak clearly or that he did not put the matter properly before us—but it is quite impossible for anyone, even a trained lawyer, to grasp from the speech he made what is really the effect of the Bill until he has seen it in black and white. As my right hon. Friend said, we have been sitting here something like five weeks. We have generally gone away early. I do not complain of that, but surely we had plenty of time to consider proposals of this sort. If it was so urgent, there was nothing to prevent the Government yesterday, or the day before, giving us notice of it and letting us see the Bill. We have been at War for seven months, and apparently the Government, have suddenly woke up to something which is of vital importance, yet they cannot tell us what is in the Bill except in a speech from a Minister at the Treasury box. We are to pass a Bill which deals with the livelihood of all sorts of people, with capital and all sorts of things, without in the least knowing what is in the Bill. My right hon. Friend said he thought there ought to be compensation for those whose works or factories were taken from them. Perhaps by error the Chancellor of the Exchequer may have forgotten if anything was contained in the Bill on that question.

My right hon. Friend has given me a copy of the Bill, and so far as I can make out it says that not only may the Government take over the factory for the purpose of managing the work they are doing, but may close that factory in order that other factories may do the work. There is nothing said in the Bill about compensation. In the short time at my disposal I have looked at the Defence of the Realm Act which was passed in September, and the second Defence of the Realm Act which was passed in November, and there is nothing about compensation in either of them. Therefore, what may happen unless the right hon. Gentleman is going to make an Amendment in Committee, is that a man may have a factory taken away from him, not for the purpose of working it, but in order that work may be done somewhere else, and have his means of livelihood taken away from him, without my compensation at all being given. If the right hon. Gentleman is going to take all the stages of the Bill in one single day, he ought, at any rate, to have brought the Bill in in such a form that it did not require amendment. I wish to make a very earnest appeal to the Government and to the right hon. Gentleman. I think he will agree that on this side of the House, from my right hon. Friend the Leader of the Opposition down to the newest Member here, we have done all we possibly could to assist the Government. The right hon. Gentleman tells us he is going to take manufacturers into his confidence. Might not the Government take the House of Commons into its confidence and show that it really trusts in the House, and let it see the Bill the authority for which the Government ask. It is a little hard that we should be asked to abrogate our position altogether. It would be much more simple to say to the Government, "You are in power; we are at war, we have confidence in you; do anything you like. We will give you a one-clause Bill under which, during the continuance of the War, the Government can do anything it likes." Then we could all go away. But if we are to come down here and to be told there is a Bill we must pass without knowing anything about it, that is treating the House with disrespect, and is not recognising the patriotism of the Opposition when we are doing what no Opposition has ever done in the history of this country.


It will facilitate matters if I reply at once to one or two things that have been said with regard to the time the House of Commons wishes to devote to an examination of the Bill. If there is a real desire to see the Bill first of all in print and to examine it before it is passed, I shall certainly assent, so far as power lies with me, if we are able to get the Second Reading to-day, to putting it down for the Committee stage tomorrow, but I hope that to-morrow the House of Commons will see its way to put the Bill through its remaining stages. With regard to the question put to me as to wages by my hon. Friend (Mr. Hodge), the moment the factory is used for any Government work the usual Fair-Wages Clause will apply. That is the answer to my hon. Friend. As to the question of compensation, that is entirely in the same position as any other power given under the Defence of the Realm Act. If the hon. Baronet will look through that Act, he will find that very much more drastic powers were taken there than any of the powers we propose to take here. There are powers with regard to houses and lands; there is power to close public-houses, and nothing is said in the Act about compensation. It is not that compensation is not contemplated. On the contrary, the War Office is making arrangements to pay compensation in all these cases, although it is not mentioned in the Act of Parliament. But the War Office cannot be embarrassed at the present moment by having 5,000 or 50,000 cases of compensation to be adjudicated upon by the Courts. Therefore, a more summary method has to be devised of paying compensation than that adopted by the ordinary course. There is certainly power to pay compensation.


Under what power is it paid?


Under the Vote of Credit. The Government have full powers to pay it. For instance, in the case of farmers the land is torn up, outhouses and buildings are destroyed, and some people's buildings have been completely swept away and their houses completely destroyed. Of course, there is no provision such as that for arbitrations under the Land Clauses Act. It is utterly impossible to conceive that the War Office should deal with that method of compensation. The methods adopted for compensation must be much more simple than under ordinary conditions. That is what we propose here. We do not propose that you should sweep away the whole of a man's interest in his factory and machinery, close his works and deprive him of his income and yet give him nothing in return. If we put in an Amendment of the kind suggested by the hon. Baronet, that would mean we should have to set up some sort of tribunal and have litigation, with which the War Office could not possibly deal at the present time.


I did not suggest any Amendment. I merely suggested that compensation should be paid, and that the Government should have power to pay the compensation.


It is not necessary at all to have an Amendment. There is no power taken in the other Acts. We are advised that we are entitled to pay compensation to farmers and others for what is done under the Defence of the Realm Act. We are advised we have full power under the Vote of Credit to pay. If it is necessary to have any Bill at all, it much be something more than this, and must deal with all cases where property has been interfered with by the War Office. I must say this word for the War Office. Complaint is being made that this is being rushed at the last moment. The War Office and every Government Department has been overwhelmed with work. It is not that we have been careless, negligent, or indolent, and that we are rushing this Bill in at the last moment. An enormous number of questions have been considered. This matter has been under consideration for some time, but I could not get this Bill until last night. That is not because anybody has been careless, but because everybody connected with it has been absolutely overwhelmed with work. I would ask the House for some indulgence to the War Office, especially under these conditions. That is the only explanation of the fact that we are asking the House, at the last moment to consider this Bill instead of introducing it later. If the House of Commons prefers to see the Bill in print, I hope they will to-morrow enable us to get the Bill on to the Statute Book.


I am very glad the Chancellor of the Exchequer has made the announcement he has and that he proposes to take the Bill to-morrow, because really it was very difficult to understand why the pressure should be so great and should arise so suddenly as to make it necessary to adopt this very strange procedure. The Chancellor of the Exchequer has made to us what is really a very important announcement. He entered a plea for the War Office. I am sure no one desires, either on this or any other occasion, unduly to criticise the War Office, and certainly no one is likely to ignore the fact that throughout this War they have been charged with labours of the most stupendous character, but if it is true, and I am sure it is, as the Chancellor of the Exchequer has told us, that one cause for this action is that the War Office are so overworked that they have not been able to bring this particular matter forward before, the reason for it is very largely that the War Office itself—and I hope the Chancellor of the Exchequer will make a suggestion or two to them, because it would come with very great force from him—have had abundant opportunities of doing that without which they will never overtake their arrears, which will go from bad to worse. It has been suggested in this House, and it has been pressed upon them by representatives of town and country, and they have had abundant offers; but for some extraordinary reason they cling with the most remarkable tenacity to every detail of their work, and the result is that they are clogged and over-borne with work which they cannot do, and I warn the right hon. Gentleman and the Government that the state of things which he has described as existing at the War Office—namely, that they are so overburdened with work that matters which he himself describes as being of vital consequence fall into arrears, will become worse rather than better unless they avail themselves of the only possible method by which they can avoid this condition of things and adopt—as they could adopt to-morrow if they liked—one comprehensive system of devolution under which the work would be at least as well done, and would be done more promptly, and which would bring to the assistance of the War Office local knowledge and experience which will be of great value.

The right hon. Gentleman has made an announcement in regard to compensation. Really, here we are not unreasonable. I do not think the Chancellor knows that the War Office have made communications upon this subject of compensation, and it was because of our experience in the matter that it was found necessary to raise it on this Bill to-day. The War Office have informed people who have made claims for compensation—at least I say this on information which I have received; I have not got it on me, of course, but I have received it from a variety of sources, and most reliable ones—and whose property—I am really not exaggerating—has been absolutely ruined by the erection of camps, and work consequent on their erection, that compensation was not legally payable.—I am not quoting the ipsissima verbe, but only the sense—but that as an act of grace the question of compensation will be considered. That is entirely different from the important announcement which the Chancellor has just made. He has told us, and we all agree with him, that in a moment like this, when we are at war, you could not approach this question of compensation as you do in the ordinary way. To invoke the Lands Clauses Consolidation Acts and all the rest of the procedure would be absurd and ridiculous. We do not ask anything of the kind. We do not ask anything which would delay the War Office. What we ask is that the principle shall be recognised and if necessary laid down here that where, in the interests of the State, you take a man's property or do definite injury to him, you shall give him fair compensation, not as an act of grace but as a matter of right.

If there has been not only doubt about this matter but considerable dissatisfaction, it has not been due to us or to any negligence on our part—we have acted with great patience—but it has been due to the fact that the War Office, whom the right hon. Gentleman has cited today, have themselves told people in the country that, under the Acts to which he referred, they are not bound to pay compensation. He has to-day given the full weight of his authority to a totally contrary view. I do not seek now for a moment to press him any further. I am a very firm believer in never pressing those who are willing fairly to consider your request beyond a certain point, therefore I am not going to press him to go further now, but I hope he will satisfy himself—the Attorney-General can very easily do this, no doubt, for him—that the Defence of the Realm Act and the other powers which the Government possess give them full power and authority to pay fair compensation where it has been found that injury has been done, and I hope also that, although we fully recognise the inevitable delay consequent upon the press of business, some of these cases of compensation may be expedited. I can assure the Chancellor of the Exchequer that I know of cases where ground has been taken for camps. Here the War Office are really to blame. They have taken their camp and made their roads and approaches afterwards. The result is that double and treble the damage has been done than would have been done if they had gone to work in the ordinary way. For this they really ought to pay the individuals whose properties have been practically destroyed, and the announcement that the right hon. Gentleman has made to-day that that is their intention and that they have got the power to carry it out, and I know him well enough and the House knows him well enough, to be quite certain that having said that, if he has not got the power he will ask Parliament to give it to him. We take it from him that this question of compensation is to be dealt with and I welcome that announcement—it is the first time it has been made—and I thank him for it, and it will give a very great deal of satisfaction to a large number of people in the country who, up to the present, believe they have suffered under a very real grievance.


In acquiring factories there is certainly a series of questions which present great difficulty. Some large factories, for instance, are making a number of articles. The Government require one part of their plant only, and not the rest. Are the Government going to take power to take the part they want and leave the other loose? If so, it will be a great hardship upon certain people, because, although only one portion of the works is required for Government purposes, the whole system overlaps and dovetails. To take one part of the plant out of the factory puts all the rest to great disadvantage. In regard to the question raised by the hon. and learned Gentleman (Mr. T. M. Healy) in the case of the Government acquiring a factory to work a contract, what is going to happen with regard to the contracts that the factory possesses? I know factories which may possibly be acquired under this kind of legislation which will have almost hundreds of contracts running, and all their customers will have a claim at law against them for non-performance. Is the responsibility for settling with these customers to lie upon the manufacturer or is the Government generally going to take powers so that the whole thing shall be cleared away and proper compensation paid? Of course, I understand it is not possible for the Government to say precisely what they intend to do, but it is important that they should have full power to meet every case of hardship arising out of the two causes I have indicated.


I wish to ask the Chancellor of the Exchequer if he will take this opportunity of not only inserting a Clause as regards compensation, but of inserting a Clause—


made an observation which was not heard in the Reporters' Gallery.


Will the right hon. Gentleman tell us not only that compensation will be paid, but on what system he is going to pay it? At present, so far as acquiring land for camps is concerned, the system has been, I understand, that the War Office has sent down assessors to decide whether they will give compensation, and, if so, how much. I asked a question yesterday as to whether some different tribunal could not be set up by which either an arbitrator or a judge or someone else could sit, and the party whose land had been taken could appear and the War Office could be represented too, because it is obviously a very un-English proceeding for the War Office to act both as defendant and as judge. Certainly in a case like the present, in taking over a man's business and his livelihood in the same way as taking over a farmer's business, it is only fair that a man should have the right not only to compensation, but of having the amount of compensation settled by some independent person. It has been arranged during this last week in the case of horses which were commandeered that the owner of a horse should have the right to appeal to the County Court judge if he was not satisfied with the amount awarded him by the War Office. The Attorney-General brought in the Clause himself.


made an observation which was not heard in the Reporters' Gallery.


In spite of the stress of war in which we are living now the right hon. Gentleman thought it important enough to bring in a special Clause to reform it. If it is necessary in the case of a valuable horse to give the owner an opportunity of appealing, surely it is much more necessary in the case of the livelihood either of a farmer or of a manufacturer! I feel sure that no Government can justify the contention that they can take a man's property and be the judge of how much they shall pay for it. Although we are all anxious to give any powers which are really necessary, I hope the House will see that rights to which every individual is entitled shall be upheld, and that the Government will give some undertaking that a third party shall decide how much compensation shall be paid.


The Chancellor of the Exchequer has happily given way as regards one day, and I will ask him whether he could not possibly see his way to give way for a day more. If we take the Second Reading to-day, it means that no discussion on the general principle of the Bill will be possible on the Committee stage, and it would be impossible really at such short notice, and with the Bill in the hands of Members only a few hours before the Committee discusses it, to frame Amendments which will be necessary if we are to protect the interests of various people. This is one of the most important pieces of legislation which has yet been proposed. It will affect vital interests in every part of the country, and it is only fair that persons whose interests are going to be affected so vitally should have an opportunity of considering Amendments which it is necessary to put down. If the Second Reading is taken now, and Committee tomorrow, it will be quite impossible to frame those Amendments, and I would therefore ask if my right hon. Friend could not see his way to postpone the Second Reading until to-morrow and the Committee stage until the day after.


My information coincides with that of my right hon. Friend (Mr. Long) that the War Office regards this matter of compensation rather as one of grace than of legal observation, but I would go a little further than my hon. Friend did. I entirely accept the Chancellor of the Exchequer's assurance that it is intended in these very hard cases—and some of them will be very hard—to pay reasonable compensation, but does he think it quite fair to leave the decision as to the amount of that compensation entirely in the hands of either the War Office or the Admiralty? I do not think so. No doubt they will try to be reasonable. One knows that in many cases those who receive compensation are not always satisfied with the award, and there will be no difficulty and no delay arising from the fact that some kind of appeal is allowed, either to the County Court judge or some other authority. In the case of a person who is not satisfied that due compensation is awarded to him, I do not see why any Government Department should be regarded as infallible in a matter of that kind.


Perhaps I ought to have explained that. The War Office do not intend to adjudicate upon this themselves. I have had discussions with the War Office. The intention is to set up what will, I think, be regarded as a perfectly impartial tribunal of men who are versed in this kind of matter. The difficulty is to find someone who is prepared to give the time for the purpose. It will not be a soldier or a sailor, but a man who will have some acquaintance with this kind of problem.


Not a lawyer?


It might be a lawyer. I should be very glad if Lord Parmoor's Committee could take the matter up. They are perfectly prepared to undertake the compensation in Hartlepool, Scarborough and Yarmouth, but to undertake this question of compensation here would involve the whole of their time being devoted to it, and the difficulty is to find someone who can be regarded as perfectly impartial to adjudicate upon this matter. I think the House of Commons will not force any County Court litigation at this juncture upon the War Office. I should be very happy if anyone could give me suggestions as to names. We want someone who will command the confidence of everybody to undertake this task on behalf of the Government, the War Office, and the Treasury. Up to the present I have not been successful in getting anyone to undertake this very prodigious task. He must be a man of considerable weight. But the most important point is the settlement of the principle on which compensation is to be paid. The moment you settle the principle the other point becomes a matter of detail. You must have a man who will command the confidence not only of the Government, but of all persons concerned.


He should have assessors.


I should doubt very much whether the man appointed would not take someone with him to assist him. However, that is a matter for consideration and adjustment. We are really in agreement as to the desirability of avoiding litigation. We do not want anything in the nature of litigation, and I hope the House of Commons will not force that upon us. We do hope that we shall be able to secure the services of a perfectly impartial person.


I have no intention to force litigation upon the War Office or anybody else. What I say is that one man is not enough in this matter. You will be dealing with very different classes of business, and it appears to me that the man appointed should have in particular cases the assistance of assessors. Assessors who understand one kind of business would not understand other kinds of business.


I would suggest to the Chancellor of the Exchequer that he should appoint a small Committee to work in conjunction with the man who is appointed to deal with these cases. The whole power in this matter should not be given to the War Office. As a rule, military men know little about business. There is no one single individual, as the last speaker pointed out, who can have knowledge of the different kinds of business involved in the cases which will have to be dealt with. During this War there have been an enormous number of contracts placed by different Departments and I think it would have been of great advantage and assistance to the War Office to have had such a Committee in carrying out the work they have had to do. Take what has been done in regard to wood by the Office of Works as one illustration. I trust that the suggestion I make as to the appointment of a small Committee will receive careful consideration. Another thing I would suggest is that there should be some relaxation made by the War Office in the way of giving greater power to local authorities to deal with repairs. I heard yesterday of a case where a military motor met with an accident. Those in charge had no power to send it to a local factory to get repaired. They had to send it to Aldershot, and meanwhile they had to hire a motor. That is simply nonsense. I have asked the man who informed me in regard to this case to supply me with a full statement of the facts in order that I may send it to the War Office. I would say that the War Office should give greater liberty to local people to take charge of their own affairs. There is a great deal of dissatisfaction throughout the country, particularly in Glasgow and Edinburgh, as to the way in which things have been tied up by the War Office. I would suggest that a Committee should act along with the official who will be appointed by the War Office in regard to these matters of compensation.


I was intensely interested in the statement made by the Chancellor of the Exchequer that among those who would receive compensation, not as ex gratia payment, but as a matter of right, were farmers. The right hon. Gentleman stated that they would be included among the class who would receive compensation if it could be proved that operations necessary in consequence of the War had deprived them of their living or had interfered with their property in such a way as to render them unable to get their crops. I take it—and I am sure I quite understand the Chancellor of the Exchequer—that claims for compensation to farmers will be considered in connection with those of others who have lost their means of livelihood.


We have had, as I am sure the Chancellor of the Exchequer must feel, very satisfactory evidence from every quarter of the House that, so far as the Government mean to prosecute the War to a successful conclusion, they will have the support of all parties in commandeering not merely ships, but all the resources of the country that are necessary in the rapid prosecution of the War. I listened with gratification to the statement of the Chancellor of the Exchequer in regard to compensation, because it marks a very important new departure on this particular aspect of the question which affects an enormous number of people in every part of the country. Take, for instance, the question of the ships that have been commandeered. Practically the whole of the colliers of the country have been commandeered, the Government agreeing to pay a price of 4s. per ton to London. When the Government bring in thirty-four interned German steamers—after taking the whole of the colliers which had contracted to carry coal to London at 3s. per ton—they are only paying the owners of the commandeered boats 4s. per ton. Well, it must appear clear to the Chancellor of the Exchequer that that is a very anomalous position of affairs. I hope the understanding that just and fair compensation will be paid to those who are injured by the commandeering of property on the part of the Government will apply equally to the commandeering of ships as well as engineering works. I hope we shall have it made absolutely clear by the Chancellor of the Exchequer that the principle which he has announced to-day will be applied to every interest in the country that has been injured in consequence of commandeering on the part of the Government. I hope it will apply to everything which the Government have taken hold of to assist them in prosecuting the War. I trust that fair and equitable treatment will be given to everybody all round, including workmen in the country as well as employers and manufacturers. I hope also that we shall in that way secure the best backing the Government can get—the backing of the whole commercial community and of the whole nation.


I venture to make an appeal to the Chancellor of the Exchequer. If he gets the Second Reading of the Bill to-day, I think he ought to give us twenty-four hours to consider its provisions before taking the Committee stage. This Bill gives the Government power to deal with very large undertakings. They have already very heavy obligations, and I do think that we ought to get time to consult the managers of these big concerns and others intimately connected with them, to see whether the conditions in the Bill safeguard them with respect to contingencies which cannot possibly be in the mind of the Government. If the Government get the Second Reading of the Bill to-day, I would suggest that the Committee stage might be taken on Thursday. As regards arbitration, I, for my own part, do not believe in large Committees. I believe in a single man arbitrator. But it is idle to suppose that there is any single individual who can have all the qualifications necessary to deal with the multitudinous cases which must arise under the Bill. Take the case of the individual who is going to adjudicate as regards compensation for land. He must be entirely in most cases, or, at all events, in some cases, ignorant of the particulars connected with big engineering undertakings, which would require a man with other qualifications. I venture to suggest that we should adhere to the single man arbitration, and that we should have different arbiters with the necessary qualifications for dealing with the vast variety of cases which must come up for adjudication.


As regards the appeal made by the hon. Member, I do hope that the House of Commons will be able to wait until to-morrow. It is really very urgent, but I do not dwell very much upon that. I hope there will not be another day's delay in equipping the Government with full legislative powers in this matter.


The Chancellor of the Exchequer said he would welcome any suggestions as to how this adjudication with regard to compensation should be carried out. May I suggest that it is quite impossible for a single arbitrator to be found with the qualifications necessary to deal with all these questions. I agree with the hon. Member who said that one man in each case is quite sufficient. The person appointed for each district should be one whose decision should carry the greatest weight. If you take the southern district, which is greatly affected in the matter of camps, it would not be difficult to get an experienced land agent or a person of that kind well known to the whole group of counties whose decision would be accepted as perfectly impartial and fair. It has been pointed out that someone should settle the principle on which these claims should be paid. That can be done by having the whole question of compensation referred to some eminent person such as Lord Parmoor to settle the principle on which compensation should be given. If, therefore, the Chancellor of the Exchequer could see his way to nominate for each group of counties some one arbitrator or person who could decide the claim, it would have the advantage that decisions would be given and the cases dealt with within a reasonable time. The Chancellor of the Exchequer has pointed out the great difficulty of finding any one person to undertake what he calls this gigantic charge. If the work were limited to two or three counties in each case, it would be less gigantic, and it would be far easier to find a person to act for the Government, and the decisions of that person would be far more likely to be accepted than if, for example, a person whose usual business was in Wiltshire or Dorsetshire were asked to decide the question of compensation in the county of Northumberland. I believe that if the Chancellor of the Exchequer adopts the principle of getting the main outline of the principle upon which compensation should be paid decided by someone, such as Lord Parmoor for instance, and appointing various persons in each group of counties, the business could be got through expeditiously and with fairness both to the Government and to the people whose properties are concerned.


We all agree that it is necessary that the War Office and the Admiralty should have the power of deciding whether it is necessary that a factory should be taken over or closed or otherwise dealt with. But when it comes to working a factory, the question arises. Is the factory going to be under the War Office? The War Office has got altogether too much to do. If the War Office is going to take over factories, it ought to put them under a Department which is accustomed as employers to dealing with workmen. If these factories are taken over or put under Government control, they ought not to be under the War Office or Admiralty but under the Board of Trade, or at least the Home Office. I should like to know exactly what it is proposed to do? Are the Government going to have these factories worked by that already overworked Department, the War Office, which is depleted of its most efficient members who have gone abroad, or are they going to put them under a Department which is accustomed to such work?


By agreeing to postpone the further stages of this Bill until to-morrow the Chancellor, I think, has done everything that is necessary to secure cordial unanimity in the passing of this Bill. For my own part I have such confidence in the Government in the present emergency that I would find a difficulty in, voting against the granting of any powers which they thought necessary for handling the present situation. But it is a somewhat different matter to vote for something which one does not understand. However loyal one may be, and however great the confidence one may have in the Government, one desires to know what one is voting for. One does not like to do it entirely in the dark. It is not because one has not confidence in the capacity of the Government that one feels like that, but it is exceedingly dangerous to set a precedent of that kind which might be applied by other Governments in which one had not such great confidence. It would have been just as practicable to have come to the House at the commencement of the War and to have passed a general Bill declaring that any act done by the Government during the continuance of the War should have the effect and authority of and be deemed to be a legal act.

I think that the Leader of the Opposition put the matter very well when he said that in such an emergency we have got to entrust any Government in which we have confidence, in its handling of the situation, with powers which are something in the nature of a dictatorship and yet not altogether a dictatorship. It would be unfortunate, I think, if it went out to the country that we were really placing any Front Bench or any Cabinet or any Committee in a position of absolute dictatorship. I do not think that that is accomplished by any of these emergency powers which have been granted. I cannot say about this Bill because I do not know what the powers are. But I do not think, as regards any of the powers which we have granted, that the Cabinet is in a position of absolute dictatorship. It is still responsible to this House. It has to come to this House for the money whereby it may carry out its policy. It has to come to this House with all its new-legislative proposals, and if at any time this House did lose confidence in the Government, whichever Government it happened to be, this House would have power to get rid of the Government and to put in another, in which it had confidence, to exercise these extraordinary powers. Although we have given in these measures extraordinary and unusual powers to the Cabinet, the Cabinet still remains responsible to the elected representatives of the people, and they have the power, if at any time they lose confidence in the Government, to turn it out and secure a Government in which they will have confidence.

Question put, and agreed to.

Bill read a second time, and committed to a Committee of the Whole House for to-morrow (Wednesday).