HC Deb 13 May 1915 vol 71 cc1878-97

Motion made, and Question proposed,

3. "That a sum not exceeding £70,545, be granted to His Majesty, to complete the sum necessary to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1916, for the Salaries and other Expenses in the Department of His Majesty's Treasury and Subordinate Departments, including Expenses in respect of Advances under the Light Railways Act, 1896." [NOTE.—£45,000 has been voted on account.]


I rise to call attention to a matter which I hope I can deal with very briefly and which is of consequence, not so much for the magnitude of the particular affair as for the principle which is involved, and for the light which it throws upon the organisation or want of organisation, or rather, I should say, the co-ordination or want of co-ordination in the policy of different Departments of the Government. I have, of course, no desire to divide the House. Indeed, I should think it an improper thing to do if it can possibly be avoided. I think that I am not under any obligation to move a reduction of the Prime Minister's salary in order that I may speak on this Vote. I wish to have a discussion on this Vote because I wish to be assured, and I think that no man except the Prime Minister can give the Committee the assurance, that the policy of the Government is one and indivisible as far as it relates to a prosecution of this War, and that the one Department of the Government will not be allowed to develop a policy of its own which is not in harmony with the general policy laid down by the Government on the Vote. The particular case which has caused me to take this course is the action of the Government towards a proposal coming from the Finance Committee of the County Council of London that they should be allowed to postpone certain capital expenditure for a year in order that they may lighten the financial burden and lessen expenditure during the period of the War. I wish to say that I was not asked by the county council to raise this question, and having regard to what passed the other day between the Chancellor of the Exchequer and my hon. Friend the Member for the City of London (Sir F. Banbury), I would add that I had no communication with my hon. Friend the Member for the City until after I had brought the matter before the notice of the House.

It came to my knowledge, I think, in the autumn, or, if not in the autumn, very early this year, that the Board of Education were pressing the county council to continue a very large capital expenditure which was required in order to reduce the size of classes in many of their schools. I do not question for a moment that that educational policy is desirable, and that in normal times it would have been pro-per for the Education Department to take the action which they have. My case is that these are not normal times, and that expenditure which ought to be incurred in normal times ought not to be incurred now. That is the first principle at stake. My attention was drawn to the matter because a friend of mine, whom I meet not infrequently at lunch, knowing that I sat on certain Treasury Committees and believing, as I am sorry to think many people do, that I have much larger influence and a much greater sphere of activity than I possess, said to me that he could not understand the action of my Committee. It was in that way that my attention was called to the matter. Early this year the Treasury issued a notice deprecating capital issues, and saying that no new issues must take place without their sanction. At the same time they sent a letter to the London County Council in reference to certain Metropolitan loans for which sanction had been asked, and in this letter they said:— It is desirable that capital expenditure by local authorities in the United Kingdom should be restricted within the narrowest possible limits at the present time. That is absolutely true. It is a sound statement of policy, and one cannot lay too much stress upon the importance of this policy. The Chancellor of the Exchequer spent a great portion of his Budget Statement in enforcing that view. Only last night he referred to it again with greater insistence, and said that the financial problem which was now before us, and which we had to meet, could only be met by the greatest economy amongst all classes—an economy which, he said, must not be confined to public authorities, but extend to individual citizens. No one will dispute that under ordinary circumstances we are not an economical nation, either in our Government or in our individual capacity. Compared with the Germans or the Frenchmen, we are an extravagant people. What the Chancellor, therefore, is asking is that we should change our habits, and he impressed upon us that that is necessary for the successful financial conduct of the War. There is no chance of getting individuals to change their habits, and there is no chance of getting local authorities to change their spending habits unless the Government will exercise a most rigorous economy in all their Departments where they can do so, unless they will abstain from pressing expenditure upon local authorities who do not want to carry it out, and unless they will exercise the severest control over any proposal by local authorities for carrying out large expenditure which does not arise out of their suggestion. The Treasury laid down an admirable rule, on the 25th February, I think it was. On the 4th of March the finance committee of the London County Council sent a reply to that letter, in the course of which they said: It appeared to the committee in particular that economy might be effected in regard to a large scheme of capital expenditure which the council, by agreement with the Board of Education, has in hand, in connection with the reduction in the size of classes in elementary schools, and in December the chairman of the finance committee and the chairman of the education committee had an interview with the President of the Board of Education with a view to securing his assent to some modifications of the scheme in the direction of postponement of expenditure. In the result, however, the council was unable to obtain any modification of the arrangements and capital expenditure thereon is therefore, proceeding at a rate of about £1,000,000 for the next triennium. The total expenditure, which is, I think, £5,000,000, will be spread over fifteen years, which are divided into these different periods, of which one terminated last year and a new one has now begun. Here we have the Board of Education refusing to permit the finance committee of the London County Council to do that which the Treasury is urging every local authority to do. That cannot be right. There ought not to be two policies in this matter. There ought not to be one financial policy at the Board of Education and another financial policy at the Treasury. If there is any conflict between the two Departments, then I say that, under the present national conditions, it is the Treasury policy which ought to prevail. We look to the Chancellor of the Exchequer to support his officials at the Treasury against all other Departments, and we look to the Prime Minister to strengthen the hands of the Chancellor of the Exchequer if the question is taken on appeal to the Cabinet as a whole. I must deal with one or two other quotations. I should say that in this particular letter the council explain that— The moneys of the Consolidated Loans Fund of the Council will be sufficient to meet the whole of the council's capital expenditure as at present estimated, thus obviating the necessity for any public borrowing. and they inquired of the Treasury whether this made any difference. I specially call attention to this because when I questioned the Chancellor of the Exchequer on the subject the other day he appeared to say that the fact that there was no public borrowing took it outside the limit of the Treasury definition of policy. On the 8th of March the Treasury addressed another letter to the county council—not in answer to the one from which I have been quoting—in the course of which they again said— All new capital expenditure should be postponed, and unless special circumstances exist works in progress should be slowed down. A very sound doctrine. Applying these principles they, however, feel bound to sanction certain proposals which had been laid before them by the county council. In a later letter they say— In sanctioning these loans their Lordships have been mainly influenced by the consideration that the expenditure has already been incurred practically as a whole, while, in the case of Battersea, the expenditure is justified as being for the furtherance of the War. But it should be intimated to the borough councils that the Treasury will not be able to approve any loans by the London County Council for new expenditure which is not necessary for the furtherance of the War, whether or not all the sanctions, Departmental or Parliamentary, normally required have already been obtained. That is to say that even if everything has been sanctioned, the Treasury was going to refuse to sanction any such loans, so urgent was it that economy should be effected. Now I come to the letter of 24th April, in which the Treasury replies to the first letter from the county council, which I have read. That letter announces that the Lords Commissioners of the Treasury are of opinion that— The Brady Street (Bethnal Green) clearance scheme should not be continued during the War, except so far as it may be financed otherwise than by loan. Then in regard to the expenditure on schools, the letter says—and mark that it is not my Lords of the Treasury, but His Majesty's Government— In regard to the expenditure on schools, His Majesty's Government have decided that in all the circumstances they cannot now ask the London County Council to postpone the work. 6.0 P.M.

That is an unusual form for a Treasury letter on a question of this kind. I think the inference is clear that the Treasury wished to stop this work and that they were overruled by His Majesty's Government.


A decision of the Cabinet.


The Chancellor and the Treasury were overruled by the Government on the financial question in favour of the Board of Education. It is against that that I protest, and that I desire to protest as strongly as I can. The Treasury goes on to define, and to narrow as much as possible, the expenditure which will be permitted. I have some more quotations, but I shall not trouble the House with them. I shall only say that the Treasury define as strictly as possible, and in a way which is utterly out of harmony with the decision just recorded by the Government in respect of the Education Department, the terms and conditions on which they will sanction the expenditure, and they say— The object in view being to conserve and to direct into channels useful to the nation, for the furtherance of the War, both the capital and the labour of the nation, it apppears to their Lordships that the important point is to stop or reduce capital expenditure by local authorities, rather than merely to restrict fresh borrowings.— I call the attention of the hon. Gentleman below the Gangway (Mr. Goldstone) to this point, as he seems to attach importance to it— and in these circumstances the fact that the London County Council has sufficient money standing to the credit of the Consolidated Loan fund to enable it to avoid new borrowings on the market, though material, does not appear to make any essential difference to the position. That letter is dater the 24th of April. I have stated my case. I have only to add one word: What is the exact working of the London County Council Consolidated Loan Fund? Into that fund come all the sinking funds, as I understand, under existing loans, and, thanks to that fact, they have sufficient money available to finance for the present all the new capital issue, which they had submitted to the Treasury, without fresh borrowings from the public, but the Treasury have rightly said, "That is not the point. The point is to economise resources in capital and in labour for the purposes of the War," and if that is not done they stop this new capital expenditure wherever they can.


What is the amount of the fund?


I cannot give the total amount of the fund, but the total amount involved in the year over these educational proposals is something like £300,000. That would be taken out of the Consolidated Loan Fund of the county council. Suppose it had not been taken. Suppose the policy of the Treasury prevailed instead of the policy of the Board of Education, then the county council would have purchased its own stock, thereby relieving the market of that stock and setting funds free for invest-men in existing war loans, or they would themselves have directly invested the £300,000 of their own in existing war loans, or in any new issue made. Therefore the policy of pressing on work which is not so immediately urgent for help or any other purpose as to make it necessary to proceed with it now, which does not help in any way in the prosecution of the War, deprives us of £300,000 which might have gone to the lightening of the financial burden, which was the text of the Chancellor of the Exchequer both yesterday and his Budget Speech last week. I hope that I have spoken in no controversial spirit. I want to carry the Government and the Committee with me. I am afraid that it is impossible that this decision should be revoked at the stage to which things have now been brought, but I do press it in regard to this particular point, that the process of slowing down which is recommended by the Treasury shall be enforced upon the Education Department in this matter and in others. I press, in the second place, that all Government Departments shall be made to conform to the financial policy which the Chancellor of the Exchequer on his own responsibility as a Minister of Finance declares to be necessary for the successful prosecution of the War; and, in the third place, I press upon the Prime Minister that the whole weight of his influence as head and chief of the Government shall be given to support the Chancellor in his arduous task, and that he shall not allow the obvious desire of the Treasury to pursue a particular policy to be overridden by pressure coming through what I may say without any offence to the Gentleman who holds the position, is a minor and less important office.

I really do not know why the Treasury were not allowed to have their way in this matter. I see a statement in a paper, which I am told is edited by a member of the minority of the London County Council, which tells the secret history of what occurred. It tells that the Treasury were holding out, and that the leader of the minority in the county council approached the Chancellor of the Exchequer and persuaded him, with the result that the Treasury decision was overruled. I think it undesirable that public Departments should follow the minorities of our local bodies, rather than the majorities, and all of us in all parts of the House will be agreed on that, whatever we think of the opinions of the majority of any particular council at any given time. It is a wholly intolerable situation that the Treasury should be preaching to all the Departments the great necessity for economy and that then, in deference to private representations made by a representative or a member—for I do not know even that he was a representative—of the minority of the particular council, the decision of the Treasury and the wishes of the majority of the council should be overruled and a policy should be enforced upon the council, which is wholly out of sympathy with the policy which the Chancellor of the Exchequer preaches in the country. I confine my case to the single illustration. I think the right hon. Gentleman must know that there is not a little uneasiness in the country as to the working of the different Departments of the Government. We do not find that they are all animated with the same spirit. We do not find they all pursue a common policy. I have been able in this case to bring forward an instance where they certainly have not done so, and to bring it forward in a case in which no possible harm can be done by the public discussion of the matter. I hope that the Prime Minister will give us an assurance that will cover not only this case, but will give us a general assurance that the Government will have one policy, and that different Departments will not pursue different policies in antagonism one to another.


May I ask whether the policy of telling local authorities to go on with school building, to supply the necessity arising from the introduction of small classes, is to continue during the War? The scheme for new school buildings accrued before the War. These buildings were rendered necessary almost entirely by the Board of Education's requirements as to small classes. I should like to know whether the Board of Education are bringing the same pressure to bear on local authorities in the provinces as apparently they are bringing to bear on the London County Council?


I believe that my salary is included in the Vote which you have put from the Chair, and I will say at once what I can in reply to the speech of the right hon. Gentleman. I do not know that I quarrel with any of the propositions which he laid down with regard to the general position, which go far beyond the particular facts of this particular question. When he says that co-ordination and common action between the different Departments of the Government are an urgent matter in the supreme national interest, he is forcing an open door. One of the main preoccupations of my life, day by day and week by week, is to secure that co-operation, though it is not always very easy to secure. There are various things which make it more difficult than might at first sight appear—the idiosyncrasies of individuals, the competing claims, not always easy to adjust, between the relative urgency of the demands put forward by one Department as against another, and the difficulty, which the Committee will readily appreciate, of not always having, perhaps, sufficient time for full consideration. Still, when all those things are taken into account, I agree that they ought not to prevent, nor do I think they have substantially prevented, the attempt at harmonious action between the different Departments of the Government in a time of emergency such as hitherto has never confronted any Administration. In regard to this particular matter, I do not claim more than a superficial acquaintance with the merits of the case, but I must point out that it is a case which rests to some extent, as I understand, on its own footing. The expenditure which the Government has sanctioned, and which the right hon. Gentleman thinks ought not to have been sanctioned, was expenditure which had been incurred, or which ought to have been incurred, in pursuance of an agreement, which goes back, I think, to the year 1910 or 1911, between the county council of that day and the Board of Education.

Under that agreement—I am not going into details—the county council undertook to provide 24,000 new school places for every three years for fifteen years. That, together with other requirements dependent upon other parts of the agreement, would have involved an expenditure during each of these triennial periods of something like £350,000 a year. Those requirements were agreed between the two parties, and in the first period of three years before the War broke out the agreement of course was fully complied with, and a part of the sum has been drawn from the Consolidated Fund of the county council in order that the requirements should be met. I do not think that anyone will dispute that under normal conditions, apart from the agreement, the education authority of a great community like London has always to secure adequate school accommodation for the additional number of children that have got to be dealt with—one of the primary necessities of our social life. I believe that as regards this particular case there were running contracts at the time when the matter came under consideration—quite apart from any prospective contracts; I am not speaking of prospective contracts—between the county council and contractors for the provision of the necessary accommodation.


Those are the contracts which the Treasury are asking them to slow down.


I am coming to that. That is the sanction of new contracts.


I think the right hon. Gentleman is misinformed. There were running contracts—I do not dispute that for a moment—but the Board of Education was pressing and is pressing for making new contracts.


That is rather another matter. Let me first of all deal with the running contracts. I agree that my first argument would, not apply to the others. As regards the running contracts, I do not think that anyone contends that the duty of the local authorities or the Government, controlling the authorities, would say that those contracts ought to be put an end to; it would expose the county council to actions for damages and so forth on the part of the contractors, and would delay the work which is absolutely in progress and which is socially necessary for educational purposes in London. As regards the slowing down of expenditure, that is a totally different matter, and perhaps I may quote in that connection the circular dealing with borrowing powers which was issued by the Local Government Board, and of which I entirely approve, on the 31st March. I will quote the last paragraph, which expressed the policy of the Government:— The Treasury are anxious that the attention of the local authorities should be particularly drawn to the fact that in consequence of the restriction of borrowing, not only as regards new works but also as regards works in progress by arrangement with contractors or otherwise to postpone works, or to enlarge the period of their completion. That is perfectly sound doctrine, and I am quite sure my right hon. Friend the President of the Board of Education is quite prepared, in this as in other cases, to suggest, if suggestion be necessary, or approve, if approval be necessary, the slowing down of the work and to postpone contracts where it can be done without serious damage or prejudice to the objects the authorities have in view, and to postpone the actual date of completion.


That is all we ask.


If that is all that is asked, then I say, so far as the Government is concerned that we are quite prepared to approve the suggestion upon the principle we are all agreed and I would suggest that the matter might, be settled in this way. The running contracts could be allowed to continue subject to whatever can be done in the way of slowing down, and the new contracts should not be continued or proceeded with. I do not think that any serious principle would be infringed by that, and I hope that all sensible men on the county council will be agreed to take that course. I attach the very greatest importance to the doctrine laid down by the Chancellor of the Exchequer, and embodied in the Treasury letter, and re-enunciated in the circular of the Local Government Board, that, in the financial and social conditions prevailing during the War, all local authorities must be prepared, whether their administration applies to public health, to education, or to any other necessary work essential under normal conditions, all public authorities must be prepared to draw in their horns and to restrict their applications for loans and even to curtail their normal activities in order that the resources of the country may be concentrated, as they ought to be concentrated, upon the prosecution of our supreme object—the successful completion of the War. I believe the House of Commons will approve of that course, which will commend itself to the judgment and conscience of the country, and I should be very sorry if there was any infringement of that principle on the part of the Government or any local authority, and I feel sure that, as far as the Government are concerned, they will not do so.


After the speech which the Prime Minister has made, I think very little remains to be said. But there is one point that wants clearing up. I do not think the Prime Minister, who has many other things to occupy him as he says, quite understood the situation. This money under the agreement was not to provide 50,000 new places for new children or an increased number of children, but it was to promote a new policy altogether, by which the classes might be reduced from something like fifty to sixty, to classes of from forty to forty-eight. All parties in the county council agreed, and I was one of those who attended the Board of Education and made a first preliminary agreement with that Department by which we might carry out this policy of providing these new places at, an expenditure of £5,000,000 spread over fifteen years. The Government came to the very wise conclusion, when the War broke out, that they should address themselves to all the local authorities with a view, as far as possible, of slowing down all capital expenditure that was not actually essential. Directly they did that, the London County Council fell in at once with that proposal and said that they were prepared to do everything they could to assist the Government. The London County Council impressed upon every one of their committees the necessities of cutting down expenditure almost to the bone, and it was a very great surprise to us when the Board of Education urged upon us, and almost forced us, not only not to slow down this expenditure, but, if anything, to press on this expenditure, though it would involve a very largo capital outlay. The policy was to reduce the size of the classes, but, after all, the children have for a generation or two been taught in those classes, and this policy of reducing the size of the class is of a luxurious character, and one which can very well be slowed down. Even the Board of Education that was pressing us on this very subject, in a letter to a school board, said:— In view of the present circumstances it may prove necessary for the Board, in certain cases, to acquiesce for a time in the continuance of unsatisfactory conditions which in normal times world have called for speedy removal. We all admit that the conditions are unsatisfactory and call for speedy removal, but these are times when we must save money, and therefore it was a great disappointment when the Board of Education said to the county council, "Whatever may be your decision about not promoting capital expenditure "on tramways and other matters, we must keep you to your bargain and compel you to carry out this new form of capital expenditure." The county council does not make an issue of capital expenditure every year, and sooner or later this money will have to be met by a further issue of capital. Therefore, if this expenditure were forced upon the county council it is perfectly obvious that the capital expenditure of the county council is increased just at the time the Chancellor of the Exchequer and the Government are most anxious to check every local authority in making demands on the money market. We are very pleased with the words which have fallen from the Prime Minister, and we are now encouraged to hope that the President of She Board of Education will look on this question from the point of view of the Government, and not from the point of view of his Department, and will see that his Department falls into line with the other Departments of the Government, and with the general decisions of the Cabinet. The right hon. Gentleman may now issue another letter to the county council saying that under present conditions they may slow down, except so far as they have to pay money on running contracts. That affects a very small proportion indeed of the whole amount required, and I trust that the President of the Board will desire to act in the spirit of the very wise recommendation of the Government, and assist the county council in every possible way. Let me tell the President of the Board of Education of the great difficulty in which his Department puts the county council at the present moment. All the committees have had admonitions addressed to them with regard to expenditure. The Tramway Committee is not to borrow money and the Housing Committee is not to borrow money, and those committees may turn round and say, if money is not to be borrowed by the committees for all kinds of useful work, why on earth is the Education Committee to be allowed to pursue its somewhat luxurious policy, and to carry out this scheme, more especially when schemes for housing and in connection with the tramways cannot proceed. The county council has been very much embarrassed by this attitude on the part of the Board of Education. I trust that the Board of Education will fall into line with the other Departments, and co-operate with the London County Council and all municipal bodies in checking expenditure for the benefit of the nation at large.


I think the right hon. Gentleman (Mr. Hayes Fisher) has scarcely been fair in his speech to the Board of Education. He read an extract from a letter which indicated the policy of the Board, in which it was stated it would overlook shortcomings of the authorities in making educational provisions. Really the publication of that letter is a disappointment to me. My information on this matter is hardly in accord with the right hon. Gentleman. The Board of Education indicated to the London County Council its readiness to acquiesce in the findings of the Local Government Board, but the initiative, as I understand, came from the London County Council Education Committee, and certain members of it pressed the Board of Education to depart from the policy indicated in the letter quoted by the right hon. Gentleman. If my information is accurate, it is not only the leader of the Progressive section of the county council who has pressed this policy of continuance upon the Board of Education, but those views are shared, in part at least, by the Chairman of the Education Committee of the London County Council. My point is that the initiative for the continuity of the policy was on the part of the London County Council and not on the Board of Education. The education committee of the London County Council pressed the Board of Education to depart from the policy indicated in the letter which the right hon. Member for Fulham quoted. Let me come to the facts of the case. This agreement, which seems to me an excellent one, was to give continuity of policy to the London County Council education committee spread over fifteen years, so that there might be no controversy between the Board of Education and the London County Council in the matter of the provision of new places for at least fifteen years. The amount involved is so insignificant that I am astonished that the right hon. Gentleman the member for West Birmingham (Mr. Chamberlain) should bring the case to the notice of the House this afternoon. What is the amount involved when we remember the authority which has to administer the sum? It is a question of a million spent in three years, or an expenditure of £350,000 in one year, provided that the London County Council determine to proceed at the normal rate and do not slow down as suggested in the speech of the Prime Minister.

I would remind hon. Gentlemen that there was an agreement reached with the education committee of the county council. The right hon. Gentleman the Member for Fulham will know to what I am referring. There was a rigid cutting down of estimates for administration which saved the London County Council a penny rate, or amounting to a saving of £173,000. In order that this agreement might be arrived at it was arranged that the education committee should have continuity for the expenditure of the money. What, then, is the amount in question? It is simply half £350,000, or about that sum, or a matter of £170,000 for the London County Council to keep an agreement to which it is committed, and to carry out works to which in part it is also committed and for which land has been purchased so that the thing may go on. It would appear to me if the continuance of this scheme is abandoned, the amount the London County Council may have to pay for breaches of contract and giving up of land may very well run to a considerable sum towards that comparatively small amount of £170,000. That is not the only point. From information which has reached me, if this means the complete or even temporary abandonment of the scheme, see what will result. One of the first things which will happen will be that a number of carpenters and joiners and builders who are now falling out of work in their trade will be prevented from taking up that employment which the continuance of the scheme would give. It will be within the recollection of the House that the hutting scheme for the New Armies is now about completed, and that the men are going under canvas. I have it on excellent authority that something like 6,000 men unemployed who are normally engaged in building and works of construction have recently registered—4,000 in London—and that there are 6,000 in the London and South-Eastern district. There is as well a number of men who do not give in cards at the Labour Exchanges or at the trade union offices. My information is that probably a number nearly twice that will be out of work in the building and constructive trades alone. About 500 unemployed members now are known to the officials of the Carpenters' and Joiners' Union. I would recall to the House that in some of the circulars which have come from Government Departments it is suggested that there should not be diminution of work if it means possible unemployment. If those men are thrown out of work they will have to be provided for out of the Poor Law, and it will surely be uneconomical to allow that to occur when by the expenditure of a comparatively small amount they might be employed at remunerative work, and at work which would help on educational conditions.

I trust that what the Prime Minister said does not mean the abandonment even temporarily of this scheme. Slowing down there may be, but I hope we are going on with it to absorb those unemployed who will soon be on the London market, and as well to make such provision so that the health of the children of London will not be sacrificed for so trifling an amount. One hundred and seventy thousand pounds and a war expenditure of eleven hundred millions—it is absurd almost to place the two amounts in contrast. If this scheme fails to go through I hope the right hon. Gentleman the Member for Fulham will contemplate for a moment the arrears of building which the London County Council Education Committee will have to overtake when the War is over and at a time when, as he knows, it will be very difficult to increase the rates. Even from that point of view it is false economy to abandon this scheme, and from an educational point of view to depart from it will weaken the standard which we all expect London to uphold. I trust that what the Prime Minister has said does not mean the throwing over of the Board of Education. The Board of Education, it is true, is not responsible for forcing this upon the London County Council. It is a Cabinet decision. That point is rather a vital one, and it is whether the Treasury is to over-ride the Cabinet or the Cabinet to over-ride the Treasury. And if this matter was submitted to the Cabinet, and if the Cabinet approved, surely the Cabinet should be regarded as the supreme authority, and not the Treasury, where the decision was probably given by a permanent official. Again, this is a case of Whitehall possibly over-riding Westminster, and, so far as I am concerned, it should be Westminster, and not Whitehall. A Cabinet decision should be paramount, and from that point of view, and from the educational point of view, and for the prevention of the accumulation of building in the time to come, I hope that the present decision will be adhered to.


The hon. Member who has just spoken is certainly misinformed as to the attitude of the London County Council in this matter. I have taken the trouble to make inquiries. It is suggested that it was the London County Council who desired to get their building scheme exempted from the general policy of the finance committee. That is not the case, as I can prove from a report presented to the meeting last week in which it is expressly stated: The chairman of the finance committee and the chairman of the education committee had an interview with the President of the Board of Education with a view to securing his assent to some modifications of the scheme in the direction of the postponement of expenditure. In the result, however, the council was unable to obtain any modification of the arrangement, and capital expenditure thereon is therefore proceeding at the rate of about one million pounds in the next triennial. The hon. Member also seemed to suggest that some bargain was made by which the maintenance estimates were cut down with an understanding that the building scheme should proceed. I know on high authority, the authority of the chairman of the majority of the London County Council, that there never was a bargain. The maintenance estimates were cut down because the county council felt that it was right to be economical at the present time. For the same reason they are willing, if the Government do not object to restrict capital expenditure in the same way. There is no question whatever of the total abandonment of this scheme. This is a scheme which is to be carried out in fifteen years. Under the scheme the London County Council is doing a great deal more than is required by the Board of Education. It is not only a scheme for building new schools, but a scheme by which the council is going to make it possible to reduce the size of the classes in the case of the elder scholars to forty, and in the case of infants to forty-eight, the present maximum being sixty. Therefore it is a scheme very much in advance of what is being done by other education authorities. Surely it is not unreasonable, having regard to the present financial position, to say, "Let us carry out the scheme in sixteen or possibly seventeen years, instead of in fifteen." For my part, I am quite satisfied with what the Prime Minister said to-day; but I think it is only fair to point out that it does not appear to be quite consistent either with the report of the interview of the chairmen of the education and finance committees with the President of the Board, or with the letter written by the Board of Education on the 3rd May last. In that letter it is written: The Government, having decided not to ask the council to postpone the work, the Board will be glad to be informed that the school building scheme of the council will be proceeded with in accordance with the existing arrangement between the council and the Board. That certainly has been understood by the council to mean that there is to be no slowing down of existing works, and that new contracts are to be entered into for the coming year in order to carry out the existing arrangement as it stands. I am glad to gather from the Prime Minister's statement to-day that that is not intended, and that some reasonable slowing down will be allowed. As far as new contracts are concerned, I hope that that will be a matter of discussion between the President of the Board and the council, and that some reasonable arrangement may be arrived at. I am sure it is only a matter which requires a little adjustment in order to arrive at a reasonable arrangement. A reason why there should be some restriction on capital expenditure in connection with that scheme is that it is possible to do something effectual. Where you have a large scheme like that of the County Hall, it is very difficult, or, at any rate, very expensive, to "slow down" expenditure unless it suits the contractor to do so. But when you have building schemes going on in different parts of London, the probability is that some builders, at any rate, would be glad to slow down their works to some extent, and therefore it would be possible to do something effectual. I think that this discussion has been very useful, because if the policy as it was understood in connection with this matter had been pursued it would have been a bad precedent, and would have made a bad impression on municipal authorities, who it is most desirable should at the present time keep their expenditure within the lowest possible limits.


I cannot offer to withdraw my Motion, because I made none; therefore there is nothing to withdraw. I rise merely to say that for my part I am entirely satisfied with the statement of policy enunciated by the Prime Minister, both as regards the general principle involved and as regards the particular case. The Prime Minister associates himself in the fullest way with all that the Chancellor of the Exchequer said as to the urgency of economy, not merely for avoiding fresh borrowing, but for avoiding fresh expenditure, and, above all, for avoiding fresh capital expenditure for the present wherever it can be done, and he promises that the Government will co-operate with that object. In regard to the particular case, he undertakes that, whilst existing contracts cannot or must not be broken—it would be improvident to do so—they may be slowed down if it is found convenient and possible, and that the county council shall not be urged or forced to enter into any new contracts if they do not wish to do so. That is a very satisfactory result of the Debate, as far as I am concerned. I do not want to carry the matter any further.


I have for many years followed educational progress in London. I feel very strongly upon the subject, and could say a good deal about it, but I shall not endeavour to do so to-night. I should like, however, to recall to the Committee one fact which has been very carefully withheld from them to-day in all the speeches which have been made. A few years ago the London education authority were so remiss in their policy and so neglected the provision of school places, thereby robbing the children of London of their heritage of free education as British citizens, that the Board of Education threatened to dock their Grant to the extent of £50,000. Eventually the amount by which the Grant was reduced was less than that. But it ought to be remembered that this building scheme, which is to be spread over fifteen years, is the conclusion of that episode. There was great remissness and shocking neglect on the part of the London education authority. I am glad to think that the spirit has now very much improved, and I do not want to say anything recriminatory on the present occasion. At the same time, it must be remembered that there is still a great deficiency of school places in London, and that anything in the nature of a slowing down of this policy—which, of course, has been inevitable during the last nine months—or any postponement of it to a large extent means nothing less then depriving the children of the greatest City of the greatest Empire in the world of the opportunities for education which every German village possesses. I shall not pursue the matter further now, but as one who believes in education I strongly appeal to the Prime Minister and to the Government generally that the whole scheme, which was a compromise and a settlement of a long-standing evil, shall not be lightly thrown aside, even in time of war.


On behalf of local authorities outside London I want to say one word of thanks to the Prime Minister for his declaration. Several speakers have thanked the right hon. Gentleman on behalf of London: I can assure him that local bodies concerned in the administration of education and of the Poor Law throughout the country will greatly appreciate his statement that extra capital expenditure should be suspended during the War. There is a strong feeling among the ratepayers with regard to greatly increased expenditure. They have no desire to shirk their responsibility with regard to education. The figures supplied me to-day show that in the last five years the expenditure on elementary education has increased by nearly £3,000,000. This feeling against increased expenditure does not arise from a desire to shirk the responsibility of providing good education. But local bodies feel that at this crisis, with the heavy current expenditure, it would be unwise and unjust to go in for extra expenditure. If the work is postponed, after the War there will be unemployment and the work will be able to be done more economically than now, when the prices of building materials are so high. From every point of view local bodies will much appreciate the determination of the Prime Minister to see that all the Departments respect the principle which he has laid down.

Question put, and agreed to.