CONTROL OF MERCHANT SHIPPING.

HC Deb 17 February 1916 vol 80 cc258-353

Mr. PETO: I beg to move, at the end of the Question, to add the words,

"But this House humbly expresses its regret that your Majesty's Government have not taken measures to utilise economically the available merchant tonnage of the country by placing it under the control of a central expert authority, with full power to requisition and direct the movements of all vessels and fix and limit remuneration for transport services of all kinds during the War."

I do not think it is necessary to make any apology for bringing before the House the very important subject that is dealt with in the terms of the Amendment standing in my name. I, at any rate, feel satisfied that our power of enduring this War depends, as much as it does on any other single factor, on whether our available merchant tonnage is well or ill managed. The economic use of our merchant tonnage is absolutely vital to us in the prosecution of this War. It is a vastly bigger factor in the general war problem even than the important matter which was debated yesterday, the defence of the country against air raids, or the use of the Air Service as a factor in the War. My Amendment asks for one specific thing. It asks that the management and control of our merchant shipping should be in the hands of a central expert authority. I ask the House to note each of those three words. I want a central authority, so that the authority over all the various committees set up by the Government to deal with one or another branch of the subject may be coordinated and centred in one authority which can deal with the whole problem. I want it to be expert, because I believe that much of the trouble caused by the enormous increase of freight is due to the unexpert handling of the subject, which can be effectively dealt with only as the result of a life study of the management of merchant shipping, and I want it to be a real authority, not an advisory committee, not a committee dealing with one branch or another, but an authority composed of a few of the most distinguished experts whom we can find—and there is no country in the world where you can LOOK with such certainty to finding Experts in the management of merchant tonnage as in this country.

It is essential that every ship now in our merchant marine should make, on every occasion, a full voyage out and homo, that there should be no undue delay in port, and no voyages made partly with cargo and partly with useless ballast, and that every voyage should be considered before it is undertaken to see whether a direct voyage or a round trip would most economise our tonnage. All questions of that kind can only be dealt with properly by experts already accustomed to the management of merchant shipping and not by various committees set up as they have been. I think it important first of all to consider for a moment very broadly what it is we have to deal with. The first fact that emerges is that we have a much smaller proportion of the total world's tonnage, according to the latest returns which I possess, those for 1911, than we had sixty years ago, when the earliest returns were made. I asked the right hon. Gentleman a question on the subject on the 21st of January, and his reply states that in 1850 we possessed—that is under the British flag—roughly 4,250,000 tons, or 44.8 per cent, of the total world's tonnage. In 1911 we possessed in the British Empire a total of 13,500,000 out of a total world tonnage of nearly 35,000,000 tons, of which 11,700,000 tons was on the register of the United Kingdom. That means that during those sixty years while our tonnage increased 150 per cent., the tonnage of the world increased by 350 per cent. Therefore it is a much more complicated problem than it would have been at any other time during the recent history of this country, and it shows that we have less control at present, that the Board of Trade, Admiralty and War Office can have only less control of the world's tonnage than we had got at an earlied period.

But we have also to consider that we are not alone at war. We have the tonnage of our Allies, and they have a very considerable amount of the total world's tonnage at their command. The merchant shipping of France, Italy, Russia, and Japan amounted to a total of over 5,500,000 tons in addition to our own in 1911, considerably more than the total tonnage owned by the Central Powers with whom we are at war. Therefore this country was not ill-equipped in respect of its merchant tonnage and the merchant tonnage of its Allies when War was declared. In considering those primary figures, I would ask the House to realise the effect of the War, taking a debit and credit account in respect of the merchant tonnage available. The first thing which emerges on the debit side is the enormous proportion of our total tonnage which has been requisitioned for war purposes. Some months ago it reached 50 per cent. I believe that the right hon. Gentleman would be able to tell us that at the present time it is very nearly two-thirds of our total tonnage, and that large proportion, I claim, has not been economically used, and has not been under expert control from the shipping point of view, and I believe that a vastly greater proportion of our tonnage has been requisitioned than that which would have been necessary if it had been managed in the way that is indicated in this Amendment. There is one comment that I would like to make. Again and again during the few years in which I have been in this House I have heard the Noble Lord who now sits in another place (Lord Beresford) appeal to the Government on every occasion when the Naval Estimates have been before the House for a larger provision of small fast cruisers, and small craft of all kinds, as auxiliaries of the Navy. I do not want to go into past history, but just make this general comment, that this tremendous strain that has been placed upon our merchant service undoubtedly is due in a large measure to the fact that we had not the wisdom and the foresight to provide an adequate number of smaller vessels for patrol duty, mine-sweeping, and all the auxiliary services of our great Fleet.

4.0 P.M.

The second fact on the debit side is the very considerable tonnage that has been sunk by submarine warfare, or in the earlier days of the War by the more legitimate measures that were then taken by the few cruisers which were available to the enemy. The next is that we have to recognise that, looking at this as a world problem, the carrying trade as a whole, it does very materially diminish the amount of tonnage available that so large a proportion of the total tonnage of the world was owned by the Central Powers, nearly 5,000,000 million tons, and that that is interned, and a very large proportion of it is not available for transport work of any sort or kind. Then there is, I may say, the complete stoppage of all new construction. In 1911 the net addition to our merchant fleet was 703,000 tons, after allowing for all the shipping lost by wrecks and in other ways; and since the War commenced, although a very large number of ships were in course of construction at the time of the declaration of war, practically no progress whatever has been made, and nothing whatever has been done to replace the wastage of war by fresh merchant ship construction. Then, also, on the debit side, we have to consider the enormous demand made upon our merchant service for the transport of ore, of munitions, and of the special seaborne trade that has been thrown upon it by the fact of the War. On the credit side we have very little. We are certainly lessening, or what is almost the disappearing of, the oversea trade of our enemies, if we are to accept the statement of the Secretary for Foreign Affairs. That, of course, has considerably reduced the tonnage required. But against that we have a very large increase of imports on the part of northern neutrals bordering the hostile States. On the credit side we can also take into account that the state of war tends greatly to a reduction of international trade, and also that we have available for our own use a part at any-rate of the merchant tonnage owned, at the outbreak of the War, by the countries with which we are at war. In my view, and it is the view put forward in this Amendment, the whole question of the movement of sugar, of ore, wheat, meat, coal, the transport of troops, the movement of oils, of horses and other animals required for War purposes, and the general cargoes of the country, form a part of one complete whole, and should be controlled by one central authority. Lord Joicey, speaking in another place on the 10th November, said that had a committee of four or five shipowners been appointed to deal with transport he believed many millions of pounds might have been saved. What I am more concerned about is that although that would have effected a saving of millions, at the same time it would undoubtedly have added to the efficiency of this country in the conduct of the War.

I turn now to another question which bears very closely upon this subject—that is, the congestion at our ports. No doubt the congestion at our ports—quite apart from the tonnage which is available, and which is a separate branch of the subject—is to an enormous extent responsible for the loss of effective tonnage. The hon. Member for Wandsworth quoted to me one case which I will give to the House. It was the case of a ship owned by himself and others which went into the port of Hull, I believe at the end of October. It was there over six weeks before they commenced to discharge the cargo; whereas, in the ordinary course, under peace conditions, it would have been cleared and been out again in eight or nine days; it would have made a voyage and a half during the time that it was in Hull before a single ton of cargo was unloaded. That shows how closely the question of congestion affects that of the total tonnage available, and what can be done with it. The very first thing that a central authority such as I suggest would have to deal with would be the congestion at our ports. Anybody who has had the management of the handling of goods in a business knows that it is quite possible for stock in the warehouses to become so much in the way as to be "eating its head off," and its room would be very much more valuable than its company. To get a port with sheds, quays, and warehouses blocked with goods is, in effect, to close your port. I am reminded of the old nursery riddle, "When is a door not a door?" and I feel inclined to ask, When is a port not a port? in view of such a state of things as exists in the ports of the whole of the country at the present time. What is the cause of this congestion? Be the cause what it may, the handling of the merchant marine cannot possibly be effective until the whole of this question has been dealt with as one of the vital problems of the War. I see by the newspapers that a new Order has been issued only today. It is intended to deal with this question of congestion, among others. The Order is:— From and after the 1st March. 1910, no British steamship registered in the United Kingdom, exceeding 500 tons gross tonnage, except steamships engaged in the coasting trade of the United Kingdom, shall proceed upon any voyage unless a licence to do so has been granted in favour of the owner or charterer of the steamship by the Licence Committee appointed by the President of the Board of Trade. It is a very meritorious purpose which is contained in that new Order. But the first thing that I would call to the attention of the House is that all it really does is to set up another Committee. There is no power of control over this tonnage in the hands of the central authority, or to deal with it as a part of one whole subject. Whatever committee they may like to appoint to deal with this matter, in my view it will only be a further step that will help to increase the present confusion and chaos in the shipping world. In this matter the Government remind me of a drowning man catching at a straw; they get into a most hopeless muddle in handling our merchant shipping, and when any difficulty arises, they appoint another committee. The policy of the prohibition of imports, which is the last new idea which the President of the Board of Trade has adopted, apparently with enthusiasm, is also intended to deal with this subject. Personally, I do not regard the prohibition of imports, the prohibition of one article and then another, as the proper way of dealing with this matter. But that undoubtedly is a matter for a separate Motion; I only mention it now to show the method of dealing with this question. The President of the Board of Trade will not deny that one of the main reasons that he proposes to prohibit the importation of a large part of the paper-making material required in this country, and oranges and apples, and what not, to be eaten by children, is that it is one of the economising steps to help to relieve congestion at the docks. I believe this is a very laudable object, but I think it would be far better dealt with by using our marine tonnage on reasonable business lines. The cargoes condemned by our Prize Courts is another reason of the congestion at our ports. I would just like to remind the House of what the Secretary for Foreign Affairs said on the 26th of January, because here again I believe the policy of the Government has added to our troubles. Speaking in regard to the question of a stronger and more clear-cut blockade policy in regard to enemy trade, he said:— The congestion in this country would he such that you could not deal with it— that is, if you were prepared to throw into the Prize Court every cargo which might be condemned. I do not agree with that conclusion to any extent. The more definitely you let neutral Powers know that you do not intend to allow goods destined for the enemy to reach the enemy the less of such goods will be shipped, and the less work will be thrown upon your Prize Courts. The first object of any neutral Power making a doubtful shipment is to get it to the port of destination, so that it may not be condemned by our Prize Courts. Therefore, as regards the congestion at some of our ports due to cargoes that were intended for the enemy, but which have been condemned by the Prize Court, this addition to congestion has been due to the very unsatisfactory policy with regard to enemy trading which the Government pursued for a very long time during this War.

There is only one other subject I want to deal with, and which is mentioned specifically in my Amendment—it is the question of the gigantic profits and the gigantic freight rates which are the direct outcome, as I think, of the mismanagement of our marine. It is thought, I have noticed, that the Excess Profits Tax to some extent deals with this question. The-Excess Profits Tax passed by this House-does not touch the question after the 1st July last. Even to the extent to which it may deal with it, it only applies to 50 per cent, of the excess profits, the amount of which can be roughly guessed by the fact that, taking the freights generally, it is not an over-statement but an understatement to say that they are ten times as much per ton carried as they were before the declaration of war. Even 50 per cent, of the excess profits is no adequate way of dealing with the subject. From another point of view I think it is a less desirable way of dealing with it. The day before yesterday the Prime Minister, in dealing with this subject, said something which seems to me to be very important. He said:— Let me remind the House, when I speak of financing the Dominions and the Allies, that it is not a question of supplying gold: it is a question of supplying the necessaries of war—food, munitions, coal and other Commodities and materials, and, what is equally important and equally essential in all our interests, the services of our shipping to convey all these things in the quantities, at the time, and to the places where they are most needed for our common purpose. That is admirable; only I wish we were doing it. But I ask you, in view of that, what can be thought by our Allies, to whom the Prime Minister referred, of such a freight rate as that for coal from Cardiff to Genoa? Before the War the freight rate was 7s. per ton; in the month of January last it was 75s., and I believe has gone over 100s. quite recently. Surely that is not conveying coal to our Allies, that being one of the things necessary for the conduct of the War, "in quantities, at the time, and to the places where they are most needed." A freight rate of 100s. for coal from Cardiff to Genoa is practically prohibitory of the export of coal from this country to our Allies.

The FIRST LORD of the ADMIRALTY (Mr. Balfour)

Why?

Mr. PETO

The reason is that you are allowing the small remainder of the merchant marine tonnage to charge such freight rates as these, and practically run amok among the national interests of this country. That is my view. Looking at it from the point of view of labour—I have just looked at it from the point of view of our Allies—it is most undesirable to hold up to the population of this country the glaring example of capital earning ten times the amount in freight rates that it was earning before the War commenced. It may be said, and I have heard it said, that it is too big a task for the Government to attempt to regulate the question of freight rates. They have requisitioned practically two-thirds of the marine tonnage. The earning capacity of that tonnage is strictly regulated by the rate at which they requisitioned the ships, and if it is possible to do that with regard to two-thirds, why should the remaining third be allowed to proceed on this laissez-faire principle of ordinary supply and demand, a principle which works in conditions of peace, but which does not apply in the conditions of war? These freight rates, which may be regarded as absurd by some observers, to our Allies in this War are disastrous.

Let me refer also to the question of new tonnage. I mentioned just now the partially completed ships which were on the stocks at the time of the declaration of war. I understood distinctly from the First Lord of the Admiralty, in a speech he made before the Adjournment at Christmas, that it was the intention of the Government to regard the completion of those ships as one of the urgent war necessities, and that labour was to be liberated for that purpose. I have heard, and I should like to know exactly how the position stands now, that that Order has been rescinded. At any rate, so far as the port of Glasgow is concerned, in the month of January the sole contribution to our merchant tonnage was one small tug. Ordinarily, even in peace time, there is much loss in wastage. In 1911, for instance, we had 165,000 tons lost in wrecks. If we are to go on for any further considerable period at war—and that is the basis, of course, of any such amendment—there is not only the peacetime loss to be considered, but the other inevitable losses, no matter how efficiently our Navy carries out its duty, and even if it became more efficient than it has been in the past, which is hardly conceivable. Under those circumstances we must make some provision for replacing the wastage. It has got, of course, to be recognised that nothing should go before or stand in the way of the necessary naval construction, but if the Navy comes first, as it does, the mercantile marine is a very good second in point of importance for carrying on the War. I cannot help just asking, particularly as I see one or two Members of the Labour party present, and I know they are doing what they can to influence those over whom they have such great control to do their very utmost at our shipyards to help the country in the great need that it has for merchant tonnage, are they sure, or can anybody be sure, that labour at our great shipyards has been really doing its best in this matter? The First Lord of the Admiralty said yesterday, speaking of naval armaments, that every nerve has been strained to the utmost to get the necessary guns. I cannot help remembering we have been eighteen months at War, and in peace time battleships have been built and finished in eighteen months. Surely if we had been straining every nerve at every dockyard and every port where ships can be constructed during the last eighteen months, it might now be the turn of the merchant service to have a little of the labour put upon it.

May I turn to another, and perhaps pleasanter, aspect of this subject, and that is that undoubtedly, so far as the officers and men of our merchant service are concerned, everyone will agree that they could not have done more than they have. May I just read a very few words from one who knows the merchant service well? He refers to the difficult services they have to perform, and continues: The captains of our transports, many of which as you know have carried great numbers of troops under most unnerving conditions, I hope will receive the proper measure of official recognition. There are also others, for instance, those serving on merchant ships, and they are surprising in number, who very frequently were under shell fire at the Dardanelles and elsewhere, and but for whose invaluable assistance neither the landings nor the evacuation would ever have been attempted. Then again there are the commanders and officers of our patrol ships which, after all, are only very frail ones, constantly patrolling our coasts under all sorts and conditions of weather and, frankly speaking, at the mercy of the enemy at any moment, either by enemy ships, submarines, mines, Zeppelins, or aeroplanes, not to mention the grave dangers of navigation with which they have to contend owing to frequently having to traverse close to land with no lights and entirely without the usual navigational safeguards. Then again there are the patrol trawlers, mine-sweepers and the like."' What is to be said of those can, I think, be said with almost equal truth of every officer of every tramp and collier. Those men, at this time of war, literally go down to the sea in ships and take their lives in their hands. I think they are deserving of something more than words. I notice the Financial Secretary to the Admiralty is present, and I cordially welcome the very appreciative way in which he has always met me in this matter. We have had from him, and to some very slight extent from the President of the Board of Trade, recognition in words of the services of these men. When I pressed, as I did to-day at Question Time, for practical recognition, then, so far far as the Board of Trade is concerned, I am told that that is a question that will not be considered until after the declaration of peace. I do not regard that as satisfactory. If you have a willing servant, it is just as well to recognise his services, and when these men are serving the nation they should receive recognition which would encourage them to continue in their efforts. You cannot expect the fullest efficiency from the utilisation of the merchant service unless the Government recognise that they are a branch of our services as essential to the national life in war as even the Army and the Navy. I beg to move.

Mr. SHIRLEY BENN

I beg to second the Amendment. I shall endeavour to show the House why I feel that the matter is pressing, and I shall very respectfully submit a suggestion to the Government for their consideration. The serious situation of the shipping is, I believe, thoroughly realised by the Government as a whole, and I quite appreciate the fact that they are endeavouring to the very best of their ability to deal with it; but it has taken a very long time to grasp the magnitude of the subject, the difficulties that have to be encountered, and the danger of entrusting to novices a question which nobody but experienced expert shipowners are capable of dealing with. Our mercantile marine, as we all know, has helped to make our country what it is. It has not only made us the great overseas carrying country of the world, but it has built up our trade in ports all over the world and has maintained it. Every ship that is requisitioned and taken away from the ordinary carrying trade of our country means a diminution of our traded something which the Chancellor of the Exchequer must view with alarm. It also means an increase in the rates of freight and an increase in the cost, not only of our food, but of our raw material here in England. Everyone of us recognise that the Army and the Navy must have all the tonnage that they require, but I respectfully submit to the House that even if the Navy needs tonnage and gets tonnage it should be used with regard to due business principles. We hear of ships requisitioned by the Government lying in the Mediterranean, vessels capable of carrying 16,000 tons of cargo from America used as warehouses, and we hear of steamers used for housing the staff of an Army. We have heard of vessels carrying coal for the Admiralty, discharging four-fifths of the cargo, and then held waiting for weeks until the small balance was required. Those are not business principles.

A great deal has been said about the increase in freight rates, and about the enormous profits that the shipowners are making. I am one of those who feel that no man ought to make money because of any action of the Government, and the Government's action in the requisitioning of those ships has unquestionably raised the rates of freight to an abnormal extent. What I should like to suggest to the Government is this, that they should appoint three expert shipowners, that they should requisition or take them away from their ordinary business, and make them directors of our shipping, and that they should pub with them one man from the Quartermaster's Department and from the Admiralty to see that they found the necessary tonnage for the Army and the Navy. I should then suggest that every ship flying and under the protection of the British flag should be requisitioned, and should be paid so much per ton every month at a reasonable rate, based on the cost of the ship, and on what they would be getting if war had not been declared, and that those ships that are not needed by the Army and the Navy should be run by their owners, who should be paid by the Government a good commission on the net profits made by each ship, and that that profit should go to the country and be used in the conduct of the War. I may be told that that is a very Socialistic idea, but I claim that at the present time the whole effort of our country, and the whole effort of everyone of us not at the front ought to be to assist with all the brains we have got, and all the money we have got, everything we have got, in order to help the Government to carry the War to a successful conclusion.

Mr. BALFOUR

The greater part of the speech of the Mover of the Amendment was devoted to general questions, and it will be the duty of my right hon. Friend the President of the Board of Trade to reply. He is in charge of this Debate, and will make clear the general policy of the Government on this very important question. Both the Mover and the Seconder appeared to criticise the action which has been taken by the Transport Department of the Admiralty, and appeared to make that Department more or less responsible for the shortage of tonnage from which the commerce of this country is to a certain extent suffering, and which has no doubt inflicted some hardships on consumers in this country, and on consumers in neutral and allied countries. I should like to say that in my opinion those criticisms are entirely misplaced. The business of the Department in the Admiralty, to whom the duty of requisitioning is entrusted, is to carry out the orders and directions given to them by departments of the Government that require tonnage, and to carry those duties out with the least possible hardship both to the ship owners and to the consumers. I believe that that duty, in ordinary times not a very difficult duty, and not a very responsible duty, is now carried out under circumstances absolutely exceptional, and for which there is no precedent in the history of this country or of any other country, and I believe that they have carried it out with great skill, enormous labour, and with the most careful consideration for all the interests involved. Since I assumed my present office I have had constant occasion to watch their work, and I believe they have earned, whether they have received it or not, the gratitude of the country. It would have been impossible for them, no doubt, to carry out this great undertaking had they not been aided by the very best advice that could be procured from competent, indeed, distinguished, shipowners. That aid has been given ungrudgingly and continuously. My hon. Friend opposite (Mr. Benn) advised the Government to call in three shipowners to carry out the scheme which he laid before the House. I believe that at this moment there are no less than eighteen shipowners of the very highest standing, whose names are household words in all commercial parts of the world, giving their very best aid and advice to the Government generally, and some of them are especially attached to the Transport Department of the Admiralty.

Why is the Transport Department of the Admiralty, which acts ministerially in this matter, which does not determine how much shipping is required, but simply determines what ships shall be taken when tonnage is required—why is it subject to criticism? I think for two reasons. One is that undoubtedly there are some ship owners who, seeing what the present market rate of freight is, would much rather see their ships earning that rate than earning the pre-arranged rates which are known as the Blue Book rates. Each of us if he were a shipowner and considered only his own interests would do the same. But I do not think that, broadly speaking, shipowners have any right to complain at this moment of any hardship inflicted upon them. The rates are, as has been truly said, not only high, but preposterously and dangerously high. On the whole, I do not think the shipping community has any very great reason to complain, though I believe that all the farsighted and enlightened men among them would greatly prefer that the commercial rates should be much lower than they are at the present time. The remedy proposed by my hon. Friend for this state of things is apparently that all the ships should be requisitioned at the Blue Book rates. I am not going to discuss that proposition; I shall leave that to my right hon. Friend the President of the Board of Trade; but may I incidentally and parenthetically remark that I think my hon. Friend the Mover of the Amendment should not have suggested that we were making money out of our Allies at this moment or that our scheme throws on the Allies a burden which they ought not to be asked to bear. Although not intentionally so, I think that is a very unpatriotic thing to say. The statement is quite unfounded, and it is one of those statements which Members of this House ought to be particularly cautious in making, because it fits in with certain prejudices and agitations which have been unfortunately present among countries to whom we are bound by the closest ties of friendship and interest. How does my hon. Friend propose to deal with neutral shipping? He says that all the British ships should be taken and, for the interests of Allies and neutrals, be forcibly employed at Blue Book rates, while the ships of those Allies apparently are to be permitted to go on earning the market rates. A more preposterous proposal I can hardly imagine. He complained that coal brought from Cardiff to Genoa reached some prohibitive price. That coal was largely carried in Italian ships, and all that my hon. Friend would do would be, not to lower the price of coal to the Genoese consumer, but to see that that price went into the hands of other nation's shipowners, and not into the hands of the shipowners of this country. It is an impossible proposal, and I am sorry my hon. Friend put it in a form which might suggest, and indeed must suggest, to a rash reader out side that this country is engaged in some selfish operation, instead of doing every thing at this moment at great sacrifice to diminish the cost of tonnage to Allies and neutrals. My hon. Friend said that he did not think the proper way to deal with this question was to prohibit certain kinds of imports. I am not going to argue that pro position, but I am going to point out that a country which in order to diminish the price of tonnage is prepared to deprive the consumers in its midst of certain imported commodities is not a country which can be accused of acting selfishly in this matter.

The only other point with which I think it necessary to deal is the alleged waste of tonnage by the Departments which requisition it. Let me say, in the first place, that that is not a thing for which the Department of the Admiralty concerned can be blamed. They do not control the other Departments. They do their best by advice, by suggestion, and by every means in their power, to see that the shipping is used to the best advantage.

If a ship is requisitioned for the Army, it is the Army that is responsible for the use to which that ship is put, and it is not in the power of the Transport Department of the Admiralty to say, "You have kept this ship too long, and we insist on its being sent back." Taking the anonymous case put forward by the Mover of the Amendment, they cannot say, "Here is a collier which has discharged three-parts of its cargo, and you are keeping it for the remaining part." I do not know what particular case that was. We do our best to examine every case where some apparent waste of tonnage occurs. I wish it to be clearly understood that when the Transport Department of the Admiralty requisitioned ships it does not become a shipowner, and it does not become responsible for the use to which those ships are put. If they are requisitioned for the Army or for the Fleet, it is the commanders of the Army or of the Fleet who are responsible for the use to which those ships are put. I do not doubt for a moment that the tonnage, if organised methods of ad ministration could be contrived, might be made to go further than it does go. But do not let anybody say, "Why do you not adopt that method?" Unless you give your generals and also your admirals—but especially your generals—a careful commercial training in shipowning, which is the work of a life, I do not see how you are going to carry it out effectually.

A comparison has been made between the way tonnage is actually used, let us say, by the generals and admirals at Mudros and the way in which it is used in the port of Liverpool. Nothing could be more misleading. Remember, the trade of the country is carried on on well-under-stood lines, by methods which may almost be described as routine. Nobody has any interest in the shipping except to load it as quickly as possible, to take it across the sea as quickly as possible, to unload it as quickly as possible, to turn it round in harbour as quickly as possible, and to bring it back as quickly as possible; and the dividends of the company concerned depend upon these operations being carried out smoothly, rapidly, and effectually. Nobody has any other interest; nobody is thinking of anything else but loading the ship and unloading it as quickly as possible and getting it out of the way, so that another ship may come in and carry on rapidly, smoothly, and effectually the over sea transport work of the country. Now turn your eyes from that picture to what necessarily goes on, let us say, in the Eastern mediterranean during the recent operations. There ships are loaded by officers who have mainly to consider that they should get in stores ordered for them as quickly as possible, and get the ships out as quickly as possible. They take them to an island like Lemnos, to a bay where there are no piers, no cranes, and none of the apparatus which you find at even a second, third, fourth or fifth-rate port in this country or abroad. These ships do not carry consignments of goods which the owner or consignee on shore desires to get out have carried to a warehouse, or distributed to the country and sold. On the contrary, you send out a ship full of stores for the military. They arrive, let us say, on 1st March. It turns out that those stores are not required for a month, six weeks, or two months. No body can foresee that. The ship remains there. Why do you not unload it? There are no warehouses or stores in which to put the goods very often. The difficulties are prodigious. The difficulties of carrying the operation out economically are almost prohibitive. I believe that if you could endow every general, every admiral, everybody concerned in these operations with the profound knowledge of the trained shipowner the matter might be improved. But the first business of the general is to secure the military end in view. Victory is his object. He wants to get the stores necessary as quickly as possible and where they are wanted, and if he does not want them at the moment he wants to keep them somewhere where he can get at them. He retains the ship in the harbour much longer than it would be retained if there were purely commercial interests at stake, and a developed commercial machinery were ready at hand to see that those interests were furthered to the utmost extent.

Take another case: a ship capable of carrying 3,000 tons is in harbour at Alexandria. It has only got 300 tons of cargo on board which are required for Salonika. The ship goes off with that 300 tons in stead of 3,000. No operation could be less economical from the point of view of tonnage; no operation, it may be, is more necessary from the point of view of military operations. You have, or may have, a perpetual conflict between the needs of tonnage and the needs of the War. You cannot draw a parallel between the ordinary working of the commercial system of a country like our own, or of the mercantile marine, and their operations at the time of war. It is folly of the House to expect—if they do expect—to see the methods which are successfully applied from day to day in a great port like Liver pool or Bristol suddenly transferred, with little or no modification, to the barren, deserted, and unequipped waters of the Bay of Mudros. That really is the reason why there has been what is from the commercial point of view undoubtedly a waste of tonnage. That is one of the reasons why this enormous amount of tonnage has been required by the Army. It is no fault of the Transport Department. To that Department it is a matter of the profoundest concern that they have been obliged to strain to the utmost the commercial resources of even this great country. They are not to blame. They are, in this respect, in fact, at the service of the military Departments, and all they can do is to carry out their very difficult and very responsible duties with as little inconvenience as possible to the shipping community. Whatever may be said in the remaining part of the Debate as to the policy or impolicy of the temporary appropriation by the Government of the whole mercantile shipping strength of the country, I hope that nothing, after the observations I have ventured to make to the House, will be said in criticism, in this respect, of the Admiralty.

Mr. HOGGE

There will be some criticism.

Mr. BALFOUR

Of the kind with which I have dealt?

Mr. HOGGE

Of Admiralty policy?

Mr. BALFOUR

Admiralty policy—what policy?

Mr. HOGGE

My point—if I may interrupt the right hon. Gentleman—was that a great number of Members of this House have certain cases against the Admiralty in the requisitioning of ships, and I was only interrupting to suggest that they would, have to be made after my right hon. Friend has finished his reply to the very inadequate case put before the House.

Mr. BALFOUR

I understand that my hon. Friend who very kindly interrupted me just now—at my request—thinks that the case made by the Proposer and Seconder of the Amendment is very inadequate, and that he has got really an effective speech in his pocket—

Mr. PRINGLE

Hear, hear!

Mr. BALFOUR

A speech with which he proposes to enlighten us! I wish I had realised that before I got up. I will not attempt by anticipation to reply to my hon. Friend, but I will only beg of him to use no argument in his speech which implies that the Transport Department of the Admiralty are responsible for the number of ships or the amount of tonnage they take up, or the management of that tonnage. They are not responsible. That is a subject on which I am, perhaps, as well qualified to speak as any hon. Member in this House. If the hon. Member chooses to say—if the general tenor of this as yet undelivered speech is that the wrong ships have been taken up, and that particular hardship has been inflicted here or there, that may be a matter of argument and detailed examination. But I am absolutely sure that enormous trouble has been taken by the Department, with the best expert advice that the shipping trade could afford to make, and that the hardship is as small as possible. I do not answer that argument by anticipation, but I would assure, my hon. Friend that if he supposes that the Admiralty are responsible for the amount of tonnage taken up, or for its management, he is labouring under a profound delusion. That is a plain and simple question of fact on which there should be no mistake, and on which there need be no argument. Under these circum stances I do not know that I can with profit or advantage longer delay the House. I regret that the gravamen of the charge that is to be made against my Department is to be made after and not before my speech, but my two right hon. Friends near me will, I am sure, be able to make up any unhappy deficiencies, which, through my misfortune rather than my fault, must attach to the words I have uttered. I believe, and I would have the House believe, that the Government are fully alive to the grave difficulties incident to the shortage of tonnage throughout the whole world. That shortage is due indeed to a number of causes, but it is due in the main to the immense demand made by the Army and the Navy, not by the Transport Department, but in fact by the general military policy of the Allies as a whole, and not to this country alone. No man can really consistently say, "We want the Army and the Navy to have everything they want, but we think the Government are gravely to blame because, after the Army and Navy have everything they want, there is some shortage of tonnage in the world." There is a shortage of tonnage! It is largely due to the operations I have mentioned. But the House will feel that to curb, control, warp, or modify your military policy on account of even the most important subsidiary considerations would be the greatest mistake you could possibly make.

Mr. HOUSTON

(indistinctly heard): It is always a delight to me to listen to the Parliamentary utterances of my right hon. Friend, and it has been so to-day. But I regret that I cannot yield to his request that no criticism should be offered against the Admiralty or any of its Departments. I am extremely sorry to differ from my right hon. Friend, with whom I have been associated for nearly twenty-four years in this House, and he and I have always, I believe, been on the best of terms. On this occasion I am sure that if I do not accede to his appeal he will believe that I am compelled to decline simply from a-sense of public duty.

Mr. BALFOUR

Hear, hear!

Mr. HOUSTON

I would like to leave my right hon. Friend for a moment and turn to the speech of the Mover of the Amendment. I was delighted to hear the First Lord of the Admiralty deal with the mischievous utterances of the Mover in regard to Italy. I certainly feel it my duty to oppose this Amendment, and to defend the Government from the attempt of the Mover of the Amendment to place a burden upon the shoulders of the Government which it is quite unable to carry. To my mind the Amendment is both unnecessary and mischievous. It is unnecessary for the fact that the request contained in it is already in force. The Admiralty have requisitioned, not as the hon. Member said, 66 per cent, of the tonnage, but, as I believe, a considerably higher percentage; while in regard to the balance of 30 per cent, or thereabouts, there is not a single ship afloat that is not absolutely under control. Therefore the request in the Amendment has already been com plied with. That it is mischievous, as I believe it to be, has been shown by the spirit of the utterances of the Mover, because we well know, when we were dealing with a similar re quest in this House not long ago, the President of the Board of Trade pointed out that such a state of things would only create greater confusion and chaos—in fact, the last stage would be worse than the first. The Amendment is, therefore, entirely futile and unnecessary, and I do not think there is the slightest chance of anyone supporting it. Certainly the Government will not accept it, and I and my hon. Friends who are associated with me in the Amendment which stands on the Paper in my name will also oppose this Amendment. Therefore it simply means wasting the time of the House—if the hon. Member will forgive me for saying so—putting his Amendment down in that form. It has already been shown by my right hon. Friend to be mischievous, and I will prove how very unnecessary it was.

If my Amendment had been permitted to be moved I would, if the Prime Minister had been in the House, have counted with certainty upon his support, because, though unwittingly of course, but with a foresight which is unusual, the right hon. Gentleman really spoke to my Amendment on Tuesday last. A reference to his speech will show that he would have been bound to support my Amendment in regard to economy of shipping and other things. The Prime Minister and I, therefore, I take it, are at one in regard to economy in the use of shipping, and not only in the use of shipping but economy in every direction, and also in the necessity of the avoidance of waste and extravagance. The Prime Minister and I are at one as to the absolute necessity of economy and of the cutting down of extravagance, and also as to the vital necessity of our export trade, and of finding money to carry on the War. I am quite sure I would have the support of the Chancellor of the Exchequer, than whom no man knows better the effects this War is having upon the finances of the country, and more particularly the effect the shortage of merchant shipping is having upon the finances of the country and the rate of exchange. The President of the Board of Trade, who will speak later, will no doubt inform us as to the difficulties and of the danger of losing our foreign trade altogether. But when the Prime Minister preaches economy, and preaches it in the solemn words of Tuesday, I beg to suggest that economy, like charity, should begin at home. The Government have every opportunity of exercising the greatest economy and retrenchment of expenditure in a more intelligent use of the merchant shipping of the country, which is as vital to this country as is the Navy. But for that merchant shipping the Government could not carry food to this country, and the country would be reduced to a state of starvation. The merchant shipping is absolutely vital to the existence of this country. It is not vital to the existence of Germany or Austria. Therefore the merchant shipping should be one of those things which deserves, and should receive, the most careful consideration of the Government. I want to be fair to the Government.

5.0 P.M.

This Government has suffered from the sins of its predecessor—not necessarily its immediate predecessor. I hope my right hon. Friend will forgive me if I reflect at all upon the Government of which he was the head. The whole trouble of the shortage of tonnage has been brought about by the naval policy of the past in scrapping all the small vessels, cruisers, and confining building operations roughly to "Dreadnoughts," super-"Dreadnoughts," and battle cruisers, leaving our trade routes absolutely unprotected. That has been a subject brought before the House time and again by my Noble Friend Lord Beresford, who has left us to go to another place, and by me, by questions, when the Chancellor of the Exchequer was First Lord of the Admiralty. It is due to that policy that we found ourselves in such difficulty at the outbreak of the War. If I may be permitted, I will, as shortly as I can, show how this shortage of merchant tonnage has been produced.

I pointed out that, at the outbreak of the War, we had no cruisers to protect our trade routes. We were short of smaller war vessels, and the Admiralty were compelled at once to take a very large number of the superior class of steamers from the merchant service and arm them as cruisers, as auxiliary vessels, and scouts. My right hon. Friend (Dr. Macnamara) seems to be amused at that statement. Does he dispute for a moment that the Admiralty had to take, and did take, a very large number of merchant steamers and fit them out as cruisers? He knows that perfectly well, and not only for cruisers, but for many other purposes. The Government also bought, at the outbreak of war, and shortly afterwards, a number of steamers which they used for certain purposes, of which he is perfectly well aware. I am not talking now of the smaller craft, such as trawlers, coasters, and others used as mine-sweepers, or ever cross-Channel boats used as boarding steamers, but I am directing attention more particularly to the ocean-going merchant ship. Even although a very large amount of tonnage was taken away by the Admiralty, rightly and necessarily, because they were short, freights did not rise at the beginning of the War, nor until about towards the end of the year 1914, when they began to show some slight rise. That was due to the difficulties in connection with finance, credit, and all that sort of thing, which stopped trade; and there was no rise of any special nature until towards the end of the year. The Sugar Commission then commenced operations, and having bought large quantities of sugar in various parts of the world, brought these cargoes into England, and crowded them into certain ports; congestion in the ports was produced. In that connection I may mention that by this time the railways, by troops, military stores, and other things, were blocked. In fact, there was very great congestion in such ports as Liverpool, Glasgow, London, Manchester, and other big ports, and that congestion first gave rise to an increase in freights. After that trade began to improve. Finance and credit improved, and there was a greater demand all round. About the middle of the year there was a sudden demand discovered for nitrates for agricultural purposes, and after the Ministry of Munitions was formed there was a great demand for nitrates for that Department. In fact, I understand that some 50,000 tons of nitrates were suddenly bought, and ships, of course, had to be requisitioned to carry that nitrate home. It will also be remembered that the Panama Canal was closed by a slide, I think, towards the end of September, but about that time there arose a great necessity on behalf of a Department. The best passenger steamers were requisitioned in Glasgow and elsewhere—15-knot passenger steamers, and sent out some 9,500 miles in ballast to the nitrate ports to bring home cargoes of nitrate. I am not now disposed to criticise, but I say this: surely there might have been some foresight as to the necessity for nitrates. Farmers are usually far-seeing people, and I suppose they would know that they wanted manures. The Minister of Munitions is, I suppose, not only one of the most brilliant but one of the sharpest and quickest members of the Cabinet, and I should have thought he would have seen the necessity for nitrates.

Mr. BOOTH

Was not that before the Ministry of Munitions was set up? The Minister of Munitions could not foresee this before the Ministry was formed.

Mr. HOUSTON

The hon. Member is quite right. I am coming to the Ministry of Munitions afterwards. Ships were sent out from Glasgow to the West Coast of South America, presumably for agricultural purposes, and then when the Ministry of Munitions was formed the right hon. Gentleman found much later on—in December—that there was a great demand. I am trying to be as brief as I can. If I dared to take the full time required to disclose my case categorically and clearly, then, perhaps, I should be more clear to hon. Members. Ten steamers were requisitioned practically in one day in Buenos Ayres. All these steamers had already been chartered or berthed, or something of the sort, and were under engagement, many to bring food home to this country. Those contracts, however, were all broken. Ships were requisitioned and ordered to go round through the Straits of Magellan to bring home nitrate cargoes. What was the result? The greater part of the merchants who chartered these steamers had sold c.i.f. for a certain date. They had to ship their cargoes. They could not get ships. They rushed into the market and bid against each other to get ships at any cost. I do not like to refer to personal matters, but I cannot give a better instance than this: I had a steamer loading at the berth from Buenos Ayres to New York. That steamer, unfortunately for me, was committed to pre-war engagements and contracts which I could not break—at very low rates, too! I therefore was put in this serious position, that I had to find a steamer at any cost. I searched the markets, and what did I find? I was fortunately able to charter an Italian steamer. How does that operation work out? I wish the Chancellor of the Exchequer were here, because I think he would be able to check me. The freight that would be earned from Buenos Ayres to New York has always been considered and looked upon by every economist in this country as invisible exports to make up the difference between our exports from this country and our imports into this country, and shipping largely forms the invisible exports. What happens? The freight I had to pay to that Italian steamer had to be paid in New York. Of course, if I had sent my own ship, it would have been paid in New York, and, in the ordinary course, that freight would have come over to this country and would have helped the American exchange. Instead of making any profit on the voyage I made a heavy loss, because I did not get as much paid on the cargo as I had to pay for the Italian steamer I chartered. There was, therefore, a dead loss to the Exchequer, because, instead of making a profit which would have been subject to Income Tax, Super-tax, an Excess Profit Tax, and the benefit to the exchange from New York to this country, which was a matter of very serious consideration to the Chancellor of the Exchequer at that time, as we all know, that money goes into Italian pockets.

That is one of the evils of requisitioning the merchant tonnage of the country. It causes, at times, great disturbance to trade, until, at the present moment—I shall be glad to be contradicted, if I can be contradicted—no merchant in South America cares to charter a British ship, because he does not know the moment that ship may be requisitioned. Now we find that British ships in Buenos Ayres are getting 135s. a ton, while Greek ships, looked upon with the greatest disfavour by merchants, underwriters, and every one, are now getting 20s. a ton more than any British ship. That is the effect of requisitioning, and the shipowner—I am not complaining—is taken away from his charter, or from his berth, and sent round on Blue Book rates. I may, perhaps, inform the House that, so far as tramp tonnage goes, Blue Book rates are worked out in this manner. I invite my hon. Friend (Sir W. Runciman) to correct me if I am wrong. Say they get 9s. a ton on their gross registered tonnage, it works out on the dead weight of the ship at 6s. Am I correct?

Sir W. RUNCIMAN

Too high.

Mr. HOUSTON

What is the correct figure?

Sir W. RUNCIMAN

Five shillings and ninepence.

Mr. HOUSTON

Well, call it 6s. on the dead weight, and to show what foreigners can command let me state that only last week I required a steamer, because my own British steamers had been requisitioned, from Liverpool to Buenos Ayres and back again. The only boat I could get was a Danish steamer, and what do you think that foreign owner asked me? Forty shillings a ton on the dead Weight per month; whereas an English tramp steamer under these Blue Book rates is getting 6s. a ton. Let me for a moment, point out to the House the methods of the Admiralty, and I hope my right hon. Friend will not take exception to what I say, and will not think I am unduly criticising the Admiralty. He says the Admiralty are not responsible; or the Transport Department. I am not picking out men or Departments. I call it the Admiralty, and they are not responsible according to my right hon. Friend. Let me take a case in point. I am dealing with specific instances. It is not imaginaton. I am not drawing on my imagination for facts. I can prove them all. A ship was requisitioned in Buenos Ayres; she was already chartered home with foodstuffs for this country, but she was requisitioned, her charter broken, and she had to go round to the West Coast for nitrates. For a moment I may perhaps digress. Speaking some months ago in this House I pointed out the folly of sending steamers out to the West Coast for nitrate, a close and heavy cargo, and in not using the measurement space left in the ship for the carriage of hay from Buenos Ayres which the Government required, and remarked that the merest tyro in shipping would have combined the nitrates from the West Coast of South America and the hay from Buenos Ayres, utilising the weight and the measurement to reduce the price of both. A simple calculation would have shown what nitrate short of her full dead weight she would require to short ship at loading port to provide for the hay for France to be shipped at Buenos Ayres, and so make the best paying combined cargo and earn the best freight. The Admiralty are growing in knowledge, and very soon they will have as much knowledge of business as the President of the Board of Trade, and they adopted that system, but they improved upon this, and the Admiralty agent on the West Coast thought he would earn some intermediate freight between, say, Valparaiso and Buenos Ayres by shipping some cargo. This cargo consisted of some 13,000 bags of beans, which were put in the ship on the West Coast, to be discharged at Buenos Ayres, and the freight, I think, was only 20s. a ton, or thereabouts. I believe it was 20s. 9d. If the Admiralty agents had taken proper trouble in this matter they would have carefully calculated how many days were going to be occupied loading and discharging, and what the amount of the hire money was per day. The amount was £80 per day, to which would have to be added what expenses would be incurred at Buenos Ayres for port dues, wharfage, etc. If those goods were wanted with the greatest possible despatch here, then it was folly to take that cargo, for if they had made that calculation it would have shown that the ship was earning little or nothing from this intermediate cargo, and was receiving delay. I take it that the right hon. Gentleman is aware that there is such a thing as trading with the enemy. The representative of the Admiralty on the West Coast—I will not mention the port—naturally has to consign his cargo. He is the British representative, and the Admiralty agent; in fact, to all intents and purposes, he is the Admiralty itself. Now he is bound to have a consignee, and what does he do? He consigns those goods in Buenos Ayres to a certain consignee, who is a German, and that German firm is recognised in Buenos Ayres as the commercial agent of the Imperial German Government. A certain branch of the .Foreign Office has issued a communication to certain associations and shipowners to the effect that they are not to trade with the enemy, and strange to say the very first at the top of the Black List with which shipowners are not to trade is the name of that firm in Buenos Ayres with which the Admiralty is trading, and therefore they are really having dealings with the enemy. No doubt we shall be informed that a German trading in a neutral country is not a German but a neutral, and that therefore the Government have not been trading with the enemy. If that is the case, I want to know why shipowners are prohibited from doing what the Government themselves have done. The hon. Member who moved this Amendment asked for the appointment of a central expert authority. How could you have a more central expert authority than the Minister for Foreign Affairs, the First Lord of the Admiralty and the Prime Minister?

The Mover of this Amendment made a violent attack upon shipowners. No doubt he is one of those who reads the Press and sees shipowners described as greedy pigs and Shylocks and all that sort of thing, and he no doubt reads that they are robbing everybody, including the poor people at home, and more particularly our Allies. But the hon. Member does not read the Press sufficiently. I do not think there ever was a more glaring instance of the truth of the old proverb That "A little knowledge is a dangerous thing," than has been displayed by the Mover of this Amendment, who appears to have no practical knowledge of shipowners or the management of ships in regard to this great problem. I agree with many of the things which the Seconder of this Amendment said. We have been told that we have been charging the Italians, our Allies and friends, who are fighting with us and for us against the enemy, one hundred shillings a ton for freight on coal from Cardiff to Genoa. May I draw attention to what I suppose was an official declaration by the Admiralty or the Foreign Office which appeared recently in the "Times," and which showed clearly that during the last few days there were in Cardiff twenty-one steamers loading, or about to load, coal for Genoa, and out of those twenty-one steamers four were Italian and the rest were neutrals, with the exception of four British steamers. In face of this statement the British shipowner is spoken of as the person who is putting up freights and doing a great injustice to our Allies. I will give to the House the statement of a prominent gentleman in Cardiff who is not a shipowner, but a very big ship charterer. He states that he has during the past few months chartered fifty steamers for Italy, only one of which was British. In face of that statement, what about the charges of the scandalous behaviour of the British shipowner? I think it is monstrous, disgraceful, outrageous, and mischievous that such statements should be made and go forth to the Press as an utterance from the House of Commons. I think it is disgraceful that before statements like that are made the facts are not ascertained. I will vouch for every statement that I make. I hope I shall be moderate, and I hope I shall in no way exaggerate.

The other day I had two steamers requisitioned at Buenos Ayres running in my regular service. I had the foreign licence certificate of the Board of Trade for those steamers, but which the Admiralty, of course, does not recognise. Now what were those steamers requisitioned for? To take oats to Italy, to Italian ports. I ask my hon. Friends below the Gangway whether they will not agree with me when I say that I do not think the shipping of cheap oats for Italian horses is of more importance than providing cheap food for the British people. There are not enough ships to go round to satisfy everybody, and I think our Italian Allies ought to be told the truth quite plainly and frankly. Italy is now making great demands upon us, and already the Italian Government have had representatives over here to see our Foreign Office and the Admiralty in order to make requisitions for them. I understand that the Admiralty have promised them four steamers in February and six in March for oats. They have promised them many steamers, but I do not know where they are going to come from. They have promised ships for 45,000 tons of coal for Italian ports at Blue Book rates, but it must not be forgotten that the neutral shipowners are quite at liberty to get all the fancy market rates. If this kind of requisitioning goes on, I do not hesitate to say that it is not a question of what the price of the loaf will be, but whether we shall be able to get a loaf at any price, because our British tonnage is being requisitioned and used for military and naval purposes, and we are now becoming dependent upon neutrals for our food supply. I do not think a more ludicrous suggestion was ever heard of outside Bedlam.

We are playing Germany's game now by our shortage of tonnage. Germany is independent of ships, but we are not, for we depend on ships not only for our Empire, but for our existence. If we are going to depend upon neutrals for our home supplies, and if we have to pay the very exhorbitant prices charged by them, it will be a matter for very serious consideration. This is the first time during the twenty-four years I have been in this House that I have ever had a dispute or an argument with the First Lord of the Admiralty, and I feel it very keenly. Under ordinary circumstances I would at once listen to the right hon. Gentleman's appeal. I was born in shipping, and I went right through the mill from one end to the other. When I listened to the First Lord of the Admiralty, and the way in which he made his speech, I began to wonder whether he was right or whether I was right. The right hon. Gentleman put up a most excellent defence for the defendant, in fact, he appealed to the Court to acquit the defendant before any charge was made. In a Court constituted as this House is, and knowing the right hon. Gentleman as we do, all of us loving him for his charming manner, I am afraid the verdict would have been given to him for anything he asked for, and I should not have opposed him if I had not felt it my public duty to my country, which I believe is in great danger at the present moment, to put all these things on one side and to speak the truth. I do not think that Italy is quite playing the game in clamouring for a large number of British ships to supply her requirements. Italy is at war with Austria, and she is using Austrian ships. For some reason well known to herself Italy is not at war with Germany, and is therefore not using German ships nor allowing anybody else to use them, although they are lying in Italian ports. I think it is only right that we should say to the Italians, "You are asking us for ships. Why don't you play the game? You have ships lying in your own ports which you do not use, and therefore you have no right whatever to ask us for British ships until you use the ships in your own ports, instead of requisitioning British ships everywhere to supply Italian demands."

I have heard the suggestion made that Italy has said, "If we do not get our demands, then we will not go on." I do not believe it. I believe it is an invention of the enemy. I do say, however, that before Italy has any right to demand from us such large numbers of ships she ought to exercise her power over those German ships in Italian ports and bring them out. Then there is the case of Portugal. I do not know whether Portugal has declared war on Germany or not, but she is fighting Germany in East Africa, and there are any number of German ships in the Tagus and other Portuguese ports, and the answer to Portugal is, "You have already got the ships there." The British shipowner has been held up as a scapegoat, and as the man responsible for this outrageous, monstrous, and unprecedented state of affairs with regard to freights. The British shipowner is held up throughout the world by an ignorant Press and by ignorant people who know nothing of the subject as being the scapegrace and villain of the piece. It is monstrously unfair to the British shipowner and to the British nation. I am not speaking from my own point of view as a shipowner, because I can treat these matters with contempt, but I have some interest in my own country, and I do not like Italy and other nations to be told that it is the British shipowner who is squeezing up the freights. Why is the shipowner to be made the scapegoat of the Admiralty? Is it not unfair of the Admiralty? The shipowner is not responsible for the high price of wheat in this country. The British farmer does not pay any of these exorbitant and outrageous freights. He has not got any freights to pay. He does not pay any Excess Profits Tax, because the House has relieved him from that. He does not even pay Income Tax on his income.

Mr. PETO

Can the hon. Gentleman say how the British farmer gets his maize and his barley without paying freight?

Mr. HOUSTON

I am speaking of the price of wheat.

Mr. PETO

You said that the British farmer did not pay freights.

Mr. HOUSTON

He does not pay freights on wheat, and I am entitled to speak of wheat. I am not attacking the British farmer, but why is the British shipowner attacked? We are told that the Admiralty is not responsible for anything. I have got the greatest possible admiration for the Navy. No man could exceed my admiration for the fighting portion of the Navy, but that does not mean the Admiralty. I do not know whether it is the Navy or the Admiralty, but we are told by the right hon. Gentleman that the Admiralty are not responsible for the waste of ships. I want to know who is responsible for the waste of colliers now? It is difficult for me to get accurate facts because every door is closed to me when I ask for information, and sometimes I can hardly rely on the answers I get because they are so evasive, but I understand, and if am wrong perhaps the President of the Board of Trade, who may have some information, will correct me, that there are something like 450 or upwards ocean-going colliers in the employment of the Navy at the present time. I ask to be contradicted if I am wrong. Is it not an extraordinary state of things that we should require so many colliers when our Fleet is not away in foreign seas, but is where it ought to be, and where it is doing good work round our own coast holding the enemy where he is?

We have a number of naval bases. I am not going to distinguish them, because, though I like to give information to the House, I am not going to give any information to the enemy if I can avoid it. These colliers in many instances have been most wastefully used by somebody. It is no use my right hon. Friend talking about vague allegations and vague statements. I have got documentary proof here for every statement I make. I may not be quite right about a vessel being at a certain port at a certain time, but I am right in my facts. When we find big ships used as colliers held up in Portland, which we all know is a naval base and a coaling base, for five months, what are we to think? What are we to think when we find a ship hung up in port at Sheerness for months, until her cargo takes fire by spontaneous combustion or ignition, and when we hear that further north round about our naval bases there are many ships lying with 200 or 300 tons in them? The right hon. Gentleman referred to the difficulties of discharging, and that sort of thing. Ships discharge part of their cargo and then they are left, these big 5,000-ton steamers, with 200 or 300 tons in them. It would be better in the interests of true economy to throw the coal overboard and bring the steamer back again to a loading port. But there is no necessity to do that, because if one ship is nearly empty she can discharge her remaining coal into another ship. I am speaking now of ocean steamers used as colliers, and I have heard of a case such as this. A big collier has been sent up North allocated to a particular fighting ship. I am not going to say where, and I am not going to say whether it is a cruiser or a battleship, but she has been sent there earmarked for that particular ship. It happens to be away cruising somewhere. I should have thought that coal which could be burnt on one ship might be burnt on another ship, but no, the collier was allocated to that particular fighting ship, and it had to wait there months for that particular fighting ship to come back. That is the evidence of economy! Who is responsible for that? According to what we hear from the right hon. Gentleman, nobody is to blame, and the Admiralty ought not to be criticised.

If I had occasion to criticise my right hon. Friend (Mr. Runciman) I should not have the least hesitation in doing so, and I do not think that he would make that sort of appeal that he should not be criticised. I think he would be ready to face the criticism. There are many such instances; in fact, it is surprising how many. I am not exaggerating when I say that half the time the steamers are on Government service is wasted, and unnecessarily wasted. Of course, the answer will be, "We must always have colliers. We do not know when the Fleet will have to move." That is quite right. Naval and military operations come first and are of paramount importance, and we must sacrifice everything, including our lives and our food if necessary, so that the war may be carried to a successful conclusion. There is always wastage in war, but I maintain that it is absolutely criminal to have waste and extravagance in war, and such a war as this. I was speaking to one gentleman from the Tyne where there are a number of staiths or coaling berths, and he told me that at Newcastle one staith has been reserved and kept vacant at all times for the Admiralty since the beginning of the War. On many occasions for long periods it has never been used. Ships have been held up, coal has been held up, miners' wages have been affected, and merchants' profits have been affected. Anyone knows that the Navy, the Government, the Admiralty, or whoever it may happen to be, have the power, and could at any time, at ten minutes or a quarter of an hour's notice, turn out the other ships from their berths to make room for Government purposes. Still, we go on throwing millions away unnecessarily, though it is the power of the purse which will tell in this War. I believe that the belligerent who has the deepest and longest purse will eventually win. We have seen that in the Napoleonic Wars, handled by Pitt in the most masterly manner. It was the purse and our Navy which told in the end.

Look at the appalling waste there has been in oil ships. Someone I know, whose name appeared on the paper requisitioning the ships, actually requisitioned a number of oil steamers, of which there was a great scarcity, to be fitted out as troop ships. They were brought round to a certain port, these tank steamers or oil ships, to be fitted up as troop ships. A ship was taken to Southampton and, after six months, never having done one stroke of work for the nation, she was sent back to have all the fittings dismantled out of her. She was on hire the whole time and was never employed. Nobody is responsible for that! When you come to think of an oil ship being fitted up as a troop ship it seems to me that, so far as the Government is concerned, with the exception of the President of the Board of Trade, there is no one, not every my breezy Friend there, who understands matters at all. A ship is a ship—that is the argument—and, of course, she may be requisitioned. We are indebted to the hon. Member for Somerset (Mr. King) for raising many questions in this House, and for once in a way he certainly hit the mark when he asked the right hon. Gentleman about the "Heliopolis." The right hon. Gentleman has told us, in answer to a question, that there is only one "Heliopolis" that was to be fitted up as a hospital ship. It has been lying at Pembroke ever since before the War, and has never done a stroke of work for the Government. The hon. Member asked what the Admiralty were going to do with that ship. I can tell him, if the Admiralty cannot. She is advertised to be sold on 1st March. [An HON. MEMBER: "Why not 1st April!"] Because they are economical, and they want to get the purchase price a month earlier than my hon. Friend suggests. Are the Admiralty not to be criticised for that? It is perfectly outrageous. I do not want to mention names to get owners into trouble. Shipowners are in a state of terror to have their names or their ships mentioned, for fear of certain consequences, and really I am beginning to think from my own treatment that there is some ground for that fear. Therefore I do not mention names of persons.

Some time ago, in this House, I spoke about a steamer which was lying in the Mediterranean and was used as an hotel for naval and military officers. She was known, in fact, as the United Services Club. Two or three days after I mentioned the fact that vessel was ordered home, and these gentlemen lost their comfortable hotel. I suppose I ought to apologise to them for having drawn attention to the matter. But so bad is the waste and the delay in handling steamers in the Mediterranean that I have felt it my duty to again refer to the matter. The waste is a scandal, A case was told by a naval officer of high rank. I do not believe it for a moment; I believe it is a naval joke or legend. But still it is an illustration of the mismanagement which goes on. I do not say whether the military authority or the Admiralty are to blame, but I should imagine it must be the military, because the matter was mentioned to me by a naval officer of high rank. It is the case of a ship that was sent to Alexandria from America with mules. When she arrived at Alexandria they said, "We do not want mules here, go on to Mudros." She went to Mudros and met with the same reception, and was advised to go on to Suvla. Again she was told the mules were not wanted, and eventually she returned to Alexandria. I can hardly believe it, but still these facts were given me as an illustration of the waste that is going on in the Eastern Mediterranean. The legend is that this mule ship was kept running about until all the mules died.

I am also going to deal with questions of administration. Again I do not know who is to blame. Since the beginning of the War we have had to transport an enormous number of horses and mules from America. To begin with the Admiralty invited tenders for the carrying of them at so much per head. But afterwards they departed from that system and took steamers on at Blue Book rates to carry the horses and mules, using their own fittings. The result was, in one ship in particular, instead of getting the horses and mules carried at £10 or £11 per head by charter, and on commercial form of charter, they requisitioned steamers and the cost worked out at £26 per head. The French Government, it is said, do not know as much about shipping as we do. But they made long contracts with a certain firm in the States—a firm with a name which was not Anglo-Saxon—and that, therefore, may be the reason why the Admiralty would have nothing to do with it. That firm took up a large number of English ships, and have been sending horses into France at a cost considerably less than we have incurred. We have brought over tens of thousands of horses and mules, and one can well imagine how money has thus been wasted. We heard the other day about the stores left behind at Gallipoli, stores which had to be destroyed—another instance of waste and extravagance. Reverting to my right hon. Friend's remark with regard to the difficulties of dealing with cargoes at Alexandria, I have one further illustration which will support my argument. A ship was loaded under the direction of an Admiralty official and was sent out to Mudros with something which was wanted very urgently. But when it arrived there it was found that the things which were urgently required were at the bottom of the ship, and she had to be sent to Alexandria, where the whole cargo had to be unloaded and reloaded. No man in this country has a greater admiration than I have for the fighting men of the Navy. But I am bound to say they know comparatively nothing about steamship management or about the handling of steamships, or the loading and discharging of cargoes. I have come across some of the Admiralty officials. I met one seventy-five years of age: a dug-out, of course, and you cannot expect a man of that age to be running about the docks superintending stevedores' work to see that all is right: he does not do it. It is left to other people, and no one is to blame. In this connection I may observe that the Admiralty do not possess the boarding-housekeeper's cat, which is always credited with the blame.

There is the question of the White Sea. I put a question on the Paper the other day as to the number of steamers frozen up in the White Sea. My right hon. Friend came to me and said it was not in the national interest that it should be answered, as it would give information to the enemy. On his assurance that that was so, I withdrew the question. Two days afterwards I again met the right hon. Gentleman and inquired of him why he had played the fool with me, seeing that I was able to hand him a cutting from a strong, highly-respectable Liberal newspaper—I mean a newspaper of Liberal politics—which contained advices from Stockholm, giving the number of ships frozen up in the White Sea. I pointed out to my right hon. Friend that evidently others knew a great deal more about these matters than we did, and if Stockholm was in possession of the information we might be very certain Germany also had it. I am going to deal with the question of the White Sea now, and I am not going to give any information to the enemy. Of course, here again, nobody is to blame. But I am told there are 137 steamers frozen up in that Sea. That means probably the loss of the whole of that tonnage for at least six months, as, in normal circumstances, the White Sea freezes about the 25th of October and does not reopen until May. Many of these steamers have been there from the very first; and the crews have had to leave them because they were without food and suitable clothing. The right hon. Gentleman may say that the Admiralty made provision and have four ice breakers. But those ice breakers have actually failed up to the present time. The worst of it is that, notwithstanding this is not the 15th, 16th or 17th Century when we had to depend for our information on sailing craft, and when we had no cables of wireless, or other such means of communication, we are still pursuing the same old methods, and, after these ships were actually frozen up, we continued to load steamer after steamer to send out to the White Sea. There were steamers loaded at Liverpool for the White Sea, and despatched in November and December. There were steamers loaded at Liverpool for the White Sea, and sent round to the Gareloch to wait until the White Sea opens. There are steamers lying in the Liverpool docks loaded for the White Sea. One steamer loaded at Liverpool had her cargo discharged on to the quay, and she was sent round to Barry to load coal.

Are we to allow the nation's money to be squandered in this manner without opening our mouths? Are we a muzzled assembly? I have every feeling of loyalty, friendship and admiration for my right hon. Friend, but I honestly cannot allow these matters to pass without comment. I would not be doing my duty if I did. There is every danger under this system of requisitioning of further waste. My Amendment refers to this excessive requisitioning—this indiscriminate, foolish and mischievous requisitioning—requisitioning which is not done, as we have been told, either wisely or well. It is the very reverse. It is no use talking about the question of percentages. Take my own fleet. Fifty-nine per cent, of it has been requisitioned. I am not a tramp owner; I am in regular liner trades. I am under obligations and contracts with neutrals who may try to ruin me if I do not carry out my undertaking's, and yet I have to pay money out of my British pocket in order to charter neutral steamers—Argentine, Spanish, American and Italian steamers—in order to do that work which I ought to be allowed to do with my own steamers.

6.0 P.M.

Our foreign trade is of vital importance to this country if we are going to maintain our shipping supremacy. People talk of our owning half the shipping in the world and of our being supreme. But that is not the case. It is foolish optimism. We only own about 38 per cent, of the entire world's tonnage. The Admiralty seem to think that we have an unlimited number of ships. Would they be surprised to learn that of steamers of 1,000 tons net and upwards there are less than 3,600 in the whole British mercantile marine, while if you take ships of 2,000 tons net and upwards there are only about 2,500. You have 70 per cent of the British mercantile marine requisitioned by the Admiralty, and I presume it is because of the admiration which the hon. Member who moved the Address has for the methods of the Admiralty that he desires them to take central control and to requisition the remaining 30 per cent. Thank God the President of the Board of Trade has got some common sense. If that were done, as a shipping nation we should be ruined, and that will be the result if this sort of thing goes on. If our merchant shipping is to be destroyed, then this country will cease to exist. Your Navy may be able to protect you from invasion, but it cannot save you from starvation. There is a great clamour about high freights. These gigantic, stupendous, infamous freights are treated as if they were a disease. They are not a disease; they are only the symptoms of a disease. If a man has a high temperature, the doctor does not say that that is a disease, but diagnoses it as the outcome of poisoning or something of that sort. The quack doctor amateurs who are suggesting all these remedies say that if you requisition all the tonnage you will bring down freights. They forget all about neutrals. Such talk is on a par with a doctor who, instead of diagnosing the trouble of a patient whose temperature is 104 or 105, merely says that we must bring down his temperature and plunges him into an ice-cold bath. Of course he brings down the temperature, but the patient will die. That is the sort of remedy that is proposed. High freights are a symptom of the disease and the disease is shortage of tonnage. The only way to cure the disease speedily is to release at once the greatest number of ships that can be released from Admiralty and military service. The attitude that is taken up in some cases is that of the dog in the manger. The Department does not want the ship itself and will not let anybody else have it. Let me give an instance. I know a ship which was in Liverpool the other day—a refrigerator ship which carried meat and foodstuffs from the Argentine to this country. The Admiralty requisitioned the ship as a transport. In the first place she had been requisitioned by the Board of Trade under the Order in Council. Then the Admiralty came along and said that they wanted her as a transport, whereupon we had the spectacle of these two great Government Departments quarrelling like two dogs over a bone, and the Admiralty, being the bigger dog of the two, took the bone away. The supply of meat, which is of so much importance to this country, is cut off, so far as this steamer is concerned, for the time being, so that your food will cost you more under Admiralty management. There is an hon. Member, who sits opposite, who takes a great interest in meat, whether frozen or fresh. If that hon. Gentleman had been here and knew of these circumstances he would be a Thorn in the side of the Admiralty.

I have diagnosed the disease and pointed out the remedy. The remedy is the employment of German ships and the release of our own from requisition. I hope I am not giving information to the enemy, but I have heard a whisper—as we used to say, a little bird has told me—that there is some idea of purchasing German shipping, wherever it is, because of our great shortage. I warn the only member of the Government present that if that is in contemplation they must be very careful how they go about it. You have one German cruiser afloat now. I do not know if you have captured her; I hope you have. There were two interned German steamers in South American ports which are reported to have got away. They are potential cruisers, and probably we shall hear of them on the trade routes again. All this is done by the Germans. They are no fools. I hate them like poison, but I have the greatest admiration for them for their thoroughness, their practical work, and their indomitable efforts. I have worked with Germans in trade and fought with Germans in trade. I know the German up and down. I admire but I do not want to know him. The object of these cruisers is not only to destroy commerce, but to draw away the cruisers from our battle fleets. They are not simply employed with the object of destroying our tonnage. I want the Admiralty to understand that in this requisitioning business, by taking ships all over the place, they are playing the Germans' game to the letter. The Germans do not want shipping; they know that we do. Therefore they do everything that they can to diminish the supply. The Admiralty should release every ship at the earliest possible moment, and insist upon our Allies using every German ship. They should prosecute the completion of every ship now under construction at the present moment, but which will take some time, because there are great difficulties caused by the fact that you cannot complete them on commercial terms; and you cannot expect workmen in the same yard to be working on one ship at commercial rates of pay and on another ship close by at war rates of pay, and I do not blame them. You cannot expect the shipbuilders to complete these ships on their contracts made before the war. It is all a question of money, and we must be careful, we must economise, we must put down every extravagance. One of the greatest extravagances is in shipping.

What you are doing in regard to shipping at present is that you are not only creating a great rise in freights, which increases the cost of food and other things wanted in this country, but you are also, by requisitioning the ships, putting the freights into the pockets of neutrals who do not pay taxes to this country and who do not have to finance this War. You will take British money out of British pockets and put it into the pockets of the foreigners. That is a very serious thing. The only thing which will bring freights down to a low level is competition. If you want low freights the supply must be greater than the demand, and if you want to see high freights the demand must be greater than the supply. People talk about the British railways and the way they have been managed. The Government have continued them under the management of those who managed them previously, and the work we are told has been successful. But are there no complaints against the railways, and is there no congestion on them? You must remember that the railways are within our own country, that they have nothing to compete with them. The position with regard to shipping is entirely different. We have about eighteen railway companies in this country. You can manage them. How many shipping firms are there—I do not mean ships or individuals, but different concerns? You have over 1,500. How are you going to handle them? The best thing the Government can do in the interests of this country is to interfere as little as possible with them. Government interference in trade has always been disastrous. Put the shipowners on their mettle, and release your tonnage. One brilliant member of the Cabinet has described its policy as being "Too late, too late!" The late Government was described as the "Wait and see" Government. I would suggest that a more appropriate title, which I hope the historian will not write as the epitaph upon the tomb of this Government, would be "Slow and sure"—slow to move, and sure to be too late.

Mr. HUDSON

I am very pleased to have an opportunity of addressing the House upon this Amendment, as it enables me to touch upon some interesting subjects relative to the best use of our shipping. There are many sides to this very big question. One, which was touched upon by the Mover of the Amendment and very largely by the last speaker, is the use of colliers. A very large number of the ships in our mercantile marine have been requisitioned for the purpose of coaling the Navy, and my attention has been called to the fact of merchant shipping being used to a considerable extent for coaling purposes for the Navy which is used merely as wharves. If the representatives of the Admiralty had been here they might have considered the opinion held outside that economies in more than one direction might be effected in regard to the taking on board of coal and the necessary fuel for our war craft. Take, for instance, the case of a large steamer taking in thousands of tons of coal and never leaving the port. You have to consider the work of filling bags with that coal later on and handing it over to the various war vessels. It is the opinion of many that these war craft could take the coal direct in many of our large ports. There are many up-to-date places where large mercantile ships can take bunkers and cargo. The matter ought to be very carefully sifted and examined. If there are ports which could have taken the largest mercantile vessels there is something to be said against the coal being turned over twice where it need only be turned over once.

It is quite true that the mercantile shipping of this country is the life of the nation. At the outbreak of the War the question of ladening at some of our ports became a most important matter to the industrial community. Many men with whom I have come in contact at once volunteered to give their services to the Admiralty so long as it was for Government work, either night or day, Sunday or week-day, if they were only given adequate notice and the assurance that the work to be done was Government work. That went on satisfactorily for some time, but, as usual, there has been a slipshod method of giving notice when Government work has had to be done, and we have had a few cases, not at all unnaturally, where the men have refused to do the work for the simple reason that they could get no adequate proof from the Admiralty agent, who was the responsible person, that the work required was Government work. After the men had volunteered to abrogate their agreement, their rules and their conditions generally, without charging extra for working at the week-end, on Sundays, or even at night, is it a fair way to deal with them? We trust that the Admiralty, when this matter has been brought to their notice, will very shortly put it right. All that the men require is that on any occasion when a boat is at staiths on the coast they will at once give the requisite information that this is Government work, and that they are wanted to work on it until it is finished, and that in addition to giving this notice an authorised agent shall be put on the Government staff to prove that this is a Government order. Another side of this question seriously affecting the industrial community is the upheaval caused by the requisitioning of ships. The great change which has come about in the nature of the vessels that come to the staiths for cargo has caused a great deal of uneasiness amongst the men. They have not the same class of ship to-day that they have had. The class of ship has very much deteriorated in opportunity of handling in regard to stowing and trimming.

Mr. HOUSTON

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

Mr. HUDSON

I quite agree with the hon. Member, and that is part of our complaint, but there is this view of the matter on the part of the men who are engaged upon this class of work. They have made the complaint for some time against the shipowners that they have not provided a proper escape in all cases, and in some cases they have been very negligent in this respect. Where there is more than one deck they have not provided for a proper escape hole for stowing and trimming.

Mr. HOUSTON

That is entirely under the Admiralty.

Mr. HUDSON

In the case as it is presented to-day, with the best quality of ships being taken, their position is worse still. What the men require, and have required for some time, is that there maybe escape holes provided in all cases where there is more than one deck. The owner, master, or charterer is responsible, and ought to be responsible, under the Government, and while there has been a great improvement during recent years on the West Coast and much of the craft that visited this coast, there has been little or no improvement upon the East Coast. I am sure, whether it is a question of taking cargo or even taking bunker coal, these necessary safeguards should be provided in all cases. We are told that in a number of cases on the West Coast they have only been provided after the men have distinctly refused to work. I am sure no one would encourage any stoppage of work to-day, but I am convinced that unless some effort is made the men themselves will have the impression, if they have not an assurance, that they can only get it by taking drastic action. I am sure it is not encouraging to anyone who is dealing with industrial matters to know that no improvement in this direction can be made unless the men really stop the work. The matter has been discussed several times just recently on the North-East Coast, and in view of the lack of opportunity of bringing matters before the House of Commons under present abnormal conditions I should like to ask the President of the Board of Trade whether he will not take some action in this matter to see that proper escapes are provided in order to safeguard the lives of the men, which are in danger when they are stowing and trimming vessels. I recently, attended a conference of these men, and they informed me that the general consensus of opinion at one or two important ports was that they would get this remedied so soon as they took the matter into their own hands and refused to load the boats. That had been the remedy to some extent in other ports.

Some years ago this was very forcibly brought before the notice of the Board of Trade. I have a copy of a circular letter issued by the assistant secretary to the Marine Department of the Board of Trade, who had been sent to visit various ports. He visited not only the West Coast, but every important port on the North-East Coast, and he said he had ascertained that while little or no fault can be found with many vessels after loading is completed, and the vessel is in a sea-going condition, there should in his opinion always be sufficient escape holes or small hatchways provided to meet emergencies which might arise at the time of loading. He says, further, that the compartments not infrequently found defective in this respect, are (1) holds, etc., on vessels having more than one deck (2), deep-water ballast tanks which are at times used for stowage of coal, and (3) 'tween-deck coal bunkers of large capacity. The remedies proposed are, in the case of (1), to make four or more holes, or small hatchways, within suitable distance from each main hatchway. This is not the men's complaint that is embodied in this letter. It is the finding of an official from the Board of Trade. The men to-day say that the condition is worse than it was with the change of vessels. It is more dangerous than it was on that account. If the vessels are held up by the men who say, "We cannot get this done unless we do hold them up," what about the shortage of tonnage to-day? I ask the President of the Board of Trade if he will take some action now. During the time that these vessels are in repair there has not been very much time for the port repairers to make the necessary hatches or small hatchways in order to provide for this, and to ensure the preparation of means of safety for the men. I trust that this will be taken notice of by the President of the Board of Trade, and that efficient steps will be taken now to bring this to the notice of all the owners.

Sir JOSEPH WALTON

There can be no question of higher importance to this country than as to how we are to handle our great mercantile marine so as to get the greatest possible carrying trade conducted. We have had a Debate somewhat varied in character, including the charming and delightful speech of the First Lord of the Admiralty, followed by the most racy speech of the hon. Member (Mr. Houston). I should like to bring back the attention of the House to how huge the figures of the commandeered mercantile marine really are. The hon. Member (Mr. Houston) spoke of 70 per cent, of the shipping having been commandeered. I think that is not quite accurate. I believe 6,500,000 out of 20,000,000 tons have been commandeered, or a shade over 30 per cent. That is the most gigantic fleet that the world ever heard of, and the question to which we have mainly to address ourselves is to how, by expert assistance, that is to be well and advantageously managed. I am bound to admit that since our last Debate on this subject there has been a considerable improvement effected in the matter of bringing in expert advisers. There has been a Committee appointed under the chairmanship of Mr. Whitley specially for the purpose of requisitioning ships or arranging shipping to bring food supplies to this country. I believe that Committee has already done most useful work. There is, again, Lord Inchcape's Committee and the General Advisory Committee at the Admiralty, to which I am glad to know there were recently added two more members, Sir Edward Hain and Mr. Groves. In addition to that we have what is now known as the Curzon Committee, which, I believe, is considering the whole problem of shipping, both in connection with this country and with our Allies. Altogether we have four Committees. The First Lord told us that altogether they had eighteen shipping experts on these Committees or assisting in the Admiralty transport. My suggestion is that these Committees need co-ordinating to a greater extent. They are housed in separate buildings. I submit that if the whole of these committees were formed into one grand committee, and the separate and smaller subcommittees appointed to take charge of separate departments, but having also meetings together on the whole as a grand committee, we should get an increased amount of co-ordination, we should avoid overlapping and we should avoid, in some cases, the forcing up of freights by over competition for tonnage. The complaint that the first Advisory Committee had to make was that they had no executive powers; that they were not able to secure that their advice should be followed.

There is no doubt whatever that in the eighteen months of War that have already passed away, untold millions of money have been absolutely wasted by mismanagement of our steam shipping tonnage. The hon. Member for West Toxeth (Mr. Houston) made some reference to the Mediterranean. I will give the House an example of waste in the Mediterranean in connection with a collier. I will give the House the name of the boat. It was the "Apollo." It loaded 6,000 tons of coal at Cardiff, and was sent out to Malta. When the ship got to Malta the officer in command there said, "I have no room for the coal, and I have no need for the coal, so you had better go on to Alexandria." At Alexandria the officer commanding said "I am in the same position. You had better return to Malta." The ship returned to Malta, but when it got back to Malta the coal was still not required at Malta, and the officer commanding there said, "You must go on to Suez." On the way to Suez the "Apollo" was torpedoed, and the final result was that the Admiralty had to pay £60,000, the value of the insurance on the steamer, and they had to pay two and a half months hire, without having got from the ship a single ton of cargo. I am bound to say, however, that the ship did one thing. It towed out a monitor to the Mediterranean on the way out from this country, so to that extent the Admiralty benefited. We have heard of waste in connection with the transports which were improperly loaded in Egypt, and which were to convey the land expedition to the Gallipoli Peninsula. When they arrived they were so improperly loaded that they had to be sent back to Egypt to be unloaded and reloaded and sent away again, with a consequent loss of precious weeks of time, which might have made all the difference between success and failure in our efforts in the Gallipoli Pensinula. I can multiply these cases, but the hon. Member for Toxteth has already given the House one after another, almost to repletion.

There is no doubt whatever that under proper expert management we do not require six and a half million tons of the mercantile marine to be commandeered. We can provide for the needs of the Navy and the Army, with an ample margin of safety, which everyone of us believe we ought to have, with much less tonnage commandeered, thereby setting free the balance for the general carrying trade of the nation. It is the over-commandeering, through mismanagement, of the mercantile marine by the Government that has forced up freights to their present enormous and ridiculous level, and the only way that we can bring about a reduction in freights is by setting free our shipping for the general carrying trade of the country. I agree that the shipping trade ought not to be allowed to make money out of the War. I would welcome increased taxation in an Excess Profits Tax in order that everybody should be treated alike all round. When shipping people make 200 per cent. extra profit, and they give the Government half of that, they still have an increase of 100 per cent. left for themselves. On the other hand, the Government deal with the coal trade by limiting the price of coal, and if we make 40 per cent. extra the Government take half, and we only get 20 per cent. increase against the shipowner's 100 per cent. There is no equal incidence of taxation in that. That is, however, a matter that I must press upon the attention of the Chancellor of the Exchequer when the proper time arrives.

Mr. THOMAS

Would you allow 20 per cent.?

Sir J. WALTON

I say 20 per cent. or 10 per cent., or whatever you like, even in the shape of a wage bonus, the same as the workmen have in so many trades. There is one particular way in which shipping might be economised that I would like to draw to the attention of the President of the Board of Trade. May I be allowed to say here that I am glad that the right hon. Gentleman (Mr. Runciman) is President of the Board of Trade. I think it is an advantage to the country that a man with his knowledge and experience of shipping in this present crisis should hold that position in the Government. I believe that he has done already excellent work, and that he will go on and still do better. With regard to the question of liners, there are liners with regular fixed sailings to various parts of the world from this country which are leaving English ports not fully loaded. I say that no ship ought to leave an English port at the present time not fully loaded. By insisting that no ship should leave that was not fully loaded, there could be a reduction of sailings which would have this effect, that many ships could be brought into employment in the general trade of the country. In view of the present economic situation, I hope that the President of the Board of Trade will take a strong line in restricting imports into this country. Half-and-half measures are no good whatever. I do not believe that we ought to have imported into this country anything that it not absolutely necessary for the conduct of the War and for the national existence. Everything else in the shape of imports ought to be prohibited. Only in that way can we bring more near an approach to the proper balance in trade the matter of imports and exports. I hope that whether at the hands of the President of the Board of Trade or through the medium of the Chancellor of the Exchequer we shall have drastic measures taken in that direction, because it is only in that way that we can bring about a reduction of freights, and it is only in that way we can conserve and properly organise our financial resources to enable us to outlive Germany in the economic sense in this great and terrible War.

There is one economy that I can advise my right hon. Friend to adopt. I do not know who has advised the Transport Department of the Admiralty in the matter of insurance, but it certainly came as a surprise to me to learn that whereas the Government insures steamers that they have chartered whilst they are at sea the moment the steamer arrives in port the Government ceases to get any premium, and a present is made to the insurance companies of the premium that is paid in respect of the steamer during the time it is in port, when it is running no risk whatever. In these present abnormal times steamers often remain a very long time in port. I hope the right hon. Gentleman will make a note of this matter, which would amount in the aggregate to a very considerable saving. It is a matter which ought to be taken up without delay. I should like also more attention to be given to requisitioning steamers proportionately from all over the country. Some figures that have been brought before my notice show that there are such enormous variations as to make many arrangements absolutely inequitable and unfair. I know that you cannot have absolute equality. You have to consider the class of boat that is required for the particular trade, and you require a boat at a particular moment, and have to take those that are available. Therefore you cannot have absolute equality, but I think you can have a greater approach to equality in the commandeering of boats. Talking about the class of boat commandeered, I know of one firm with twenty-one steamers, and four steamers were commandeered for the White Sea. The Board of Trade issued a circular in December that described the awful conditions there, and setting forth that only strongly-built vessels ought to be sent to the White Sea. All I know is, that of these four steamers not one was a strongly-built vessel. Two of them are frozen up in the White Sea at the present moment, and one is under repairs in consequence of the last voyage, which will cost probably £5,000 to £10,000, which the Government have to pay. By the selection of the proper boat a great saving might be effected in that direction.

There is also the question of delay by keeping steamers too long in the ports of discharge. I will give three examples of what occurred this year. The "Dale-ham" arrived at London with a cargo of oats for the Government, and for thirty-seven days she was detained here before her cargo was discharged. The "Sands-end," also with a cargo of oats, came to London and was delayed thirty-five days before she was discharged, and the "Coniston," also with a cargo of oats, was delayed thirty-six days here.

Mr. HOUSTON

That is not much.

Sir J. WALTON

The hon. Member says, "that is not much," but I would point out that the usual time these ships have taken in normal periods is seven days. These three ships were brought to London with oats cargo, and could not be taken to berths to discharge except after a delay of at least one month, and at that very time, in the early part of January, Liverpool was not overcrowded. There were lighters at Liverpool which could have been used, and the ships could have promptly discharged their cargo at Liverpool. Why could not one steamer have been sent to London, one to Liverpool and one to Avonmouth, instead of sending all the three steamers to London and adding to the congestion. I submit that by proper business management this congestion could be reduced, and not only could the congestion be reduced, but a great saving could be effected by enabling steamers to increase the number of voyages, and therefore carry more cargo for the benefit of the country. I trust that the President of the Board of Trade will give his attention to this matter of lessening the time occupied in discharging, by careful selection of the ports to which vessels are sent, and by having an effort made to get an increased number of dock labourers, even if they have to be brought back from the front. The sinews of war depend upon our financial resources, and it would pay to bring back 5,000 men to discharge our ships more quickly and increase the carrying trade, and thus increase our exports to strengthen our financial position.

An announcement has been made in an Order in Council in the "London Gazette," which comes into force on the 1st March. The question has been raised as to whether, in considering the whole problem, a scheme of limitation or alteration of freights should be attempted. At first I was led away by that as a possibly advantageous course, but when I come to consider the question of neutral shipping, and when I ascertain that one-third of the trade of this country is being carried by neutral ships at the present moment, I ask myself the question—Would we not by forcing all British shipping into the home trade, drive the neutral ships to neutral trade, in which they would get enormous rates of freight, and would the change in the end be to our financial advantage? I cannot, therefore, agree with the idea of commandeering the whole of the British mercantile marine, or of fixing upon an absolute limitation of freights, without giving every consideration to every aspect of the question. There is no doubt whatever that, by amalgamating all the committees into a strong central body of control, as advocated by the hon. Member for Devizes (Mr. Peto), huge economies would be effected, and the financial position of the country greatly strengthened, while the cost of our food supplies would be considerably reduced. I do not know how things came to be arranged. I heard a most extraordinary case the other day. I hope that I shall not offend my hon. Friend who has come from Australia (Sir George Reid), but the New South Wales Government having bought up wheat, a very advantageous arrangement was made for ships at considerably lower than the market freight to bring that wheat from Australia, and it was a surprise when it was announced afterwards that some of that wheat had been sold in England at the highest prices obtained in the British market. Therefore, they were getting the advantage of the concession which had been made in freight and also the advantage of having bought up the wheat at low prices in New South Wales.

I do not know to what extent that occurs, but it only shows how in these matters great care is needed to secure fair play, financial and otherwise, to this country. I hope that that only occurs to a small extent in connection with New South Wales, where I have many friends and receive a warm welcome if I visit it; but still, when we are considering a problem of an extremely vital character, we are bound to look at it all round, find even to criticise our friends as well as our enemies. I trust that this Debate will be followed by drastic action on the part of the President of the Board of Trade in insisting upon the full use of expert guidance and advice in the management of our great fleets in the mercantile marine. Personally, I believe in leaving ships as much as possible to the management of their present expert owners. I do not believe in all this centralisation. I would rather reduce the six and a half million tons of commandeered shipping to four million tons, and let the other two and a half million tons be managed by their proper expert owners under some separate arrangement between them and the Government.

Mr. HOGGE

This Debate must have impressed Members of the House very strongly in comparison with yesterday's Debate on the question of Zeppelins. Yesterday we were debating how best to protect ourselves from the attacks of Germany by Zeppelins, and we had a crowded House and continued attention to the Debate. To-day I think the Debate is even on a more vital point than the protection of this country from Zeppelins, so far as the real life of the country is concerned, because, I take it, that the thesis which my hon Friend the Member for Liverpool (Mr. Houston) was advancing in his speech really amounted to this, that we have a great Navy, of which we arc all legitimately proud, but which at the present moment has, along with other Departments of the Government, to make such use of the mercantile marine as may actually destroy a very large part of the mercantile marine, which has been built up by British shipowners not only in this country but in other countries, and has resulted in tangible assets which this country receives in what we call invisible exports. If that is the ease which my hon. Friend was advancing, it lies at the very vitals of the continued prosperity of this country. Therefore I listened with extreme interest to many of the points advanced by my hon. Friend. I also, and another hon. Friend of my own, have an Amendment on the Paper dealing with the same subject in a slightly different way. There are five points on that particular Amendment, some of them covering those that have already been spoken to by certain hon. Members of this House. The first deals with the wasteful requisitioning of ships, and as a result of that the withdrawal of mercantile tonnage from commercial use. I do not know whether it is necessary to add to the examples that have already been given of what I think is a wasteful use of the tonnage which exists, but perhaps I may be allowed to give one or two, in order that the House may appreciate the fact, which it must surely appreciate from all those different examples coming from so many different sources.

There is a large amount of discontent among the shipowning community with regard to the methods of requisitioning. Since one took an interest in this problem one has been inundated from all parts of the country, and from a port near the constituency which I myself represent, with examples from men who own those ships, always accompanied with a strict command that on no account are any of those details to be disclosed, and I think that my hon. Friend was perfectly right when he said that so far as the shpowning community itself is concerned there is what may be described as a reign of terror among those men—a belief that if they criticise in public, if they use certain means and methods, the results of that criticism—it may be right or it may be wrong—are shown in the percentage of the requisitioned ships. I have an example here of a collier which lost nearly eight months in one of the estuaries on the East Coast. It arrived in that estuary with a cargo of coal for a particular cruiser which was named. I do not know why the coal could not have been used by some other cruiser, but at any rate this collier was attached to this particular cruiser. It lay for four months in that particular estuary before it got rid of that cargo. It then recoaled at a coaling station in that district. It remained another four months in that estuary before it got rid of its second cargo. It then left that estuary and went elsewhere, and eventually proceeded to Portland. It lay in Portland, which after all is a coaling station, for a couple of months, and finally discharged its third cargo at Southampton. So it only carried three cargoes of coal inside twelve months, and all its tonnage capacity, so far as that collier was concerned, with the exception of those three cargoes, was lost to the commercial and mercantile community of the country.

Mr. HOUSTON

And at the same time the Admiralty were paying public money for the hire of that collier.

7.0 P.M.

Mr. HOGGE

I am glad that my hon. Friend interrupts, because he points out what is more important still to my argument, that during all that time the Admiralty were paying public money for the hire of that collier. The second example which I have to give covers a period of slightly over a year. This is a particular boat, and here again one does not want to give the precise name or the location, but I can sum up its history in three sets of figures. During 437 days in the period with which this example deals this boat lay for 370 days in port, and was only at sea during fifty-four of those days being used for the purpose for which she had been chartered. That is another example of the kind of thing of which we complain. A third example is that of a particular boat which took two months to discharge less than 4,000 tons of coal for a particular port on these shores. Those examples could be multiplied over and over again, but as the point has been spoken to already I do not want to labour it further. Everybody will agree that there has been a large amount of wasteful requisitioning of ships, which has a very disastrous effect upon the mercantile tonnage of this country, so far as its use is open for those commerical purposes which incidentally contribute to the life blood of the community. The second point of the Amendment to which I am speaking points out that a certain amount of this has resulted from what we call ill-advised and unnecessary military operation. I do not want to make a point of that during this Debate, because presumably there will be other opportunities which will enable us to address ourselves to this part of the question. I would remind the House, at any rate, of this fact, that every one of our Expeditionary Forces has to have provided for it a certain amount of transport, and that the regulation amount of tonnage for a soldier is, I understand, four tons for the East and the Mediterranean, which is the area of these particular expeditions. Members of the House have only to multiply four tons by the number of men conveyed from time to time to those parts of the area in which we are fighting, to understand and appreciate how, at one fell stroke, you can remove from the mercantile tonnage of the country a tremendous amount of what ought to be available for other purposes. Therefore, on grounds of policy, I think that a good deal could be said that would amount to this, that if the Coalition Cabinet had observed a better policy with regard to the methods in which this War has been pursued, and in the choice of the areas in which the fighting should take place, problems of this kind could not have arisen. As to their policy, of course, I do not think that I should discuss it too intimately, because there will be other opportunities when one can make a more direct appeal to the House upon it, but let me at any rate draw attention to the fact that these Expeditionary Forces have knocked out a very considerable amount of tonnage. It means a great aggravation of the increase of freights—there can be no doubt about that. I understand that shipowners are having, as far as freights are concerned, and the results from those freights, the time of their lives. My hon. Friend behind me interrupts by saying, "Some of them," which may mean that he excepts himself.

I have been reading the "Statist" newspaper, which has been dealing with this question from week to week, and which, only ten days ago or a fortnight ago, gave what the shipowners profits are going to be during the present year. [An HON. MEMBER: "A prophet!"] It seems to me that there is within reach of my voice a number of very prosperous shipowners, and some of them have appealed this afternoon to the Government to take even more Super-tax from them, and I assume that the man who wants to pay more Super-tax is at any rate prosperous. I do not think that the shipowner can get away from that particular point. The "Statist" sets out in figures that there is going to be an increased amount of over 50 per cent.—the figure they give being 71 per cent., but I shall only put it at 50 per cent.—upon what was made in 1914. The additions are from freights which are yielding big profits, and of course the Government is getting at some of those profits. From the figures given by the "Statist," I find that the freights between the River Plate and the United Kingdom, which in 1914 were 13s. 6d., are now 113s. 6d., or an increase of 1,000 per cent. From the Atlantic ports I find that the increase amounts to 796 per cent., and that, roughly taking the all-over figure, the increase of freight is something like 800 per cent. above what they were. If that is challenged, please bear this point in mind that the figure is given by the "Statist," in dealing with the question of shipping. The "Statist" may be wrong, but I am giving the "Statist" figures, and that is the percentage which they state.

As a result of that, the prices of foodstuffs in this country must obviously rise; and, again from the "Statist," I discover that from between October, 1915, and January of this year the rise in the price of wheat in this country was 30 per cent., so that not only was there a rise in the price of wheat, but there was an additional price paid to the farmer in this country, and to the man in this country who is the holder of foodstuffs. These two men in this country, by this increase in freights, are gaining better prices for their goods, while, of course, the price of the ordinary foodstuffs of the people in this country is at the same time rising very considerably. That is why we say that this wasteful requisitioning is one of the causes of the increase of freights and the rise in prices. Let me come to the last point in the Amendment. We say that "it diminishes the resources of the nation for the successful conduct of the War." I remember my right hon. Friend the President of the Board of Trade dealing with this question of shipping just before the Recess, and he addressed himself to that very Amendment which was moved by my hon. Friend the Member for Devizes to-day, and, as a matter of fact, he demolished my hon. Friend's proposal before the Recess, and if my hon. Friend will look up the OFFICIAL REPORT he will find the case made by the President of the Board of Trade against what he proposes in his Amendment to-day. My hon. Friend said of the First Lord of the Admiralty that his speech was very charming; it was also very shrewd; but it is an extraordinary thing that the First Lord of the Admiralty, who is a responsible Minister of the Government, is not present now to reply to the speech of my hon. Friend. For nearly an hour and seventeen minutes he occupied the time of the House in giving case after case of criticism of the Admiralty. The First Lord is not here to reply.

Of course I know that my right hon. Friend the Parliamentary Secretary to the Admiralty is here, but he tells us that he is so busy in dealing with the financial side of the Admiralty's work that he knows nothing about the other side. I have often heard him say so. It may have been true to say so at the moment, as he did not wish to address himself to some question put to him. Many a time I have heard him say, "I do not know anything at all about that; financial work is my work, and I know all about that." I am aware that my right hon. Friend knows all about that. The President of the Board of Trade, as I said, demolished the case put forward by the hon. Member for Devizes, but at the same time he made some other contributions to the discussion, which are relevant to the Debate we are having now. He said that the Board of Trade was taking steps to restrict the employment of British ships between foreign ports. I hope that the right hon. Gentleman will deal with that point again to-day because it lies at the heart of much of this Debate. I think hon. Members will agree that a great deal of the prosperity of this country depends on the enterprise, sagacity, shrewdness and determination of many of our shipowners who have established routes of shipping between foreign ports, the ships probably never touching the British Islands, all the income from the business done in this way coming into Great Britain. It is an invisible export; it is the payment of an invisible export, and in all our financial controversies of late years one of the great points always made by Free Trade enthusiasts at any rate is the enormous contribution of invisible exports to the prosperity of this country. I say to the President of the Board of Trade that if he restricts the employment of British ships between foreign ports—of course, I know how it may be excused—what is going to happen? You are not only going to lose invisible exports, but you are going to lose a great deal more, because if the British ships cannot carry on that trade, who are going to carry it on? The neutral ships between New York and Buenos Ayres will cut into the trade which has been built up by British industry, by British sagacity, and British shrewdness. It stands to reason that if that trade by neutrals is continued for a year or a couple of years, or as long as the War lasts, every British shipowner will have again to fight for it after the War is over. The neutral will be in possession, and he will be able to fight with more muscle and determination than formerly, because he is now getting access to a source of capital which he never had before, but which will enable him not only to maintain the trade, but to buy new ships and trade under better conditions and offering better terms.

Mr. HOUSTON

And they are not paying Excess Profits!

Mr. HOGGE

As my hon. Friend points out, they are not paying excess profits. The words of the right hon. Gentleman in the OFFICIAL REPORT were, "We are taking steps to restrict the employment of British ships between foreign ports." There may be necessity for that, but I want to say a word about it. I read a chapter of the book of the right hon. Gentleman and I obtained from it all the points I am making now; therefore he will at any rate support me in the criticism which I have made. The second point my right hon. Friend made was that the Board of Trade were requisitioned ships for food-stuffs. I have no criticism to make on that, which I conceive to be a necessity, and I do not think that anyone would at all criticise the requisitioning of ships for the purpose of bringing food-stuffs to this country. My hon. Friend objects to carrying oats for Italian horses. He would rather, as my right hon. Friend below me said, and I do not know whether he meant it, be carrying oats for the British Government. I leave it to my right hon. Friend to deal with that, but at any rate that is what he said. The point is that when we are bringing foodstuffs to this country no British shipowner objects, but they do object to carrying it elsewhere. The right hon. Gentleman also said that we are trying to co-ordinate the naval and military demands and also the demands of the Dominions. I think that is a very necessary thing to do, and I hope he will be able to tell us how far he has been able to go in this scheme of co-ordination. I am perfectly certain we must sympathise with him in his difficulties. I pointed out just now that an Expeditionary Force takes up 4 tons of shipping for every man sent out, and I can quite understand if, as President of the Board of Trade with the problem of shipping in front of him, he is faced some morning with a proposal from the Army to carry soldiers here, there, and anywhere, which must interfere with any scheme of co-ordination he may have at the back of his head. I should be glad to know what he has been enabled to do. There was the fourth point he mentioned, that we are trying to secure economy in requisitioned tonnage. What necessity was there to secure economy in requisitioned tonnage if there had not been waste before? I am perfectly certain that the right hon. Gentleman, who is one of the most alert business men in the Cabinet and in the House, would not have proposed to secure economy in requisitioned tonnage if there had not been waste. He agrees there has been waste and that he is going to secure economy, and perhaps he may tell us how.

The fifth point that he made was that we are going to try and increase the tonnage available, and he mentioned the question, among others, of pushing forward the ships that were on the stocks in the dockyards in this country. We are getting back in that to a very vital question which justifies the words in the Amendment of my hon. Friend the Member for North-West Lanark (Mr. Pringle) and myself about "ill-advised and unnecessary military operations," because we all know that that reduces itself to a question of men and the use of men. You cannot use men in the Army and in the Navy and have them in the country at the same time to do the work that the country needs. You cannot get ships off the stocks without labour, or goods out of the harbours and docks, or off the railway trucks. There are in this country known to myself merchants in places like Glasgow going down to the goods yards with their own lorries and their own men searching between the trucks trying to unload their own goods. It stands to reason you cannot do those things without men and that is why we use the words "ill-advised and unnecessary." The Government must look at this matter from a more all-round point of view than they have ever done before. The phrase has been used in this Debate, and it is true, that the financial resources at the finish are the greatest asset that this country has in fighting the German foe. The financial resources of this country could be frittered away, and what use would a great and powerful and victorious Navy be at the end of the War if it had not been able to protect our mercantile marine so that they could start level in the great competition with other peoples of the world, and particularly America, which is gathering in the shekels from every corner of the world at the present time and which will probably be one of our greatest financial competitors in the future? That is why I am surprised that more attention has not been given to this Debate by Members of this House. This question is vital to the very future prosperity of this country, and I am glad, at any rate, that I have been enabled to remind the President of what he wrote in days gone by, and which I have got on my library shelves now, and which I hold as part of my political creed and which I believe he holds too, and which is, I think, necessary to preserve the integrity and prosperity of this country.

The PRESIDENT of THE BOARD of TRADE (Mr. Runciman)

The quotations which my hon. Friend has just made from views expressed by me and printed some years ago are another example of the danger of writing books. I remember my right hon. Friend the Chief Secretary remarking that he had never written a book without embarrassing himself, and while I should like to be cautious about what I put down in print as to economics concerning the mercantile marine I do not repudiate anything that I wrote some years ago, for indeed, there is no industry in the world which in itself exemplifies what I believe to be economic truth so fully as does shipping. But during the War there is a good deal of economic truth which is subject to modification or which must be subject to modification, while we are doing that which is so unnatural, as attempting first of all to divert the whole of our industrial machinery to warlike ends, and secondly, with our industrial machinery to carry out tasks far greater than it was capable of in times of peace. That is exactly the problem which has been put to those who are responsible for the management and control of merchant vessels. We are trying at the present time to pour a quart into a pint pot, and the trouble we suffer from in this country with regard to high prices is due to that fact and to nothing else. High prices may be due. High prices may be made higher by mismanagement, by suddenly breaking into the markets, by cancelling engagements, which may be necessary in time of war, but it is quite certain that the general tendency upwards is due to the fact that we are attempting with a mercantile marine which is limited in size to carry out tasks far greater than those ever undertaken in times of peace.

There have been many estimates given of the number of vessels which are under requisition by the Government. I do not know whether it would be proper for me to say exactly what the number is as to the tonnage, but I think we may take it that it is a very considerable part of our mercantile marine. It is many times greater than the whole merchant navy of some of our Allies. I am quite sure that Germany would have been intensely proud if in times of peace she had had control of the vessels which we have been able to requisition for naval and military purposes. That heavy requisitioning—and here I must say a word for the Transport Department of the Admiralty—is not due to the Transport Department, but as my right hon Friend the First Lord of the Admiralty said, it is due to the demands which the Transport Department is ordered to fulfil. I do not know enough intimately of the methods of the Transport Department to deal with the criticisms which have been offered here to-day, but the Financial Secretary to the Admiralty is prepared to do so at a later stage. I must say that the demands which are made are made mainly for military and naval purposes. The tonnage which is taken away from the ordinary trade of the United Kingdom of the Dominions and of the foreign countries which we have been in the habit of serving is of necessity not only a loss to that trade, but throws on the remaining tonnage a strain which the merchants of these various countries are bound to meet if they are to continue their business, and they enter into hot competition for the vessels available, for they have contracts which they must fulfil; and I would remind the House that the fulfilment of contracts is not only delivery but the delivery of goods at a certain date, a fact very often left out of account by those who imagine that a smaller mercantile marine can go on doing an increasingly large amount of work and at no increased cost to anybody. These facts are so serious that what is called the shipping problem has become the greatest economic problem of the day. I will only make one qualification of my use of the phrase "shipping problem," and say that many mistakes are made because "shipping problem" is used in the singular about a group of problems, and not one. There is no one shipping problem. There are a hundred shipping problems, and when I come to deal with the question of putting all shipping problems under one authority I can point out how impossible it is, and, indeed, how unscientific it is to think that merely because ships are called "ships" that they can be placed in one category, and that we should imagine that there is one problem only to be solved, and that one authority can deal with that one problem.

Let me put one of the first problems we have to meet. Whereas in peace conditions before the War, out of the number of vessels which served this country, taking the number as a hundred, a certain proportion of them were borrowed, and now we are attempting to do that same trade, not with a hundred ships, but with about sixty-seven, and out of those sixty-seven something from twenty-one to twenty-four, according to the fluctuations of the month, are neutral, foreign vessels. That, in the first place, limits the range of our action. We have argued before in this House the question of maximum prices. Maximum prices can always be evaded by those determined on getting service at any price. But apart from the possibility of evasion, let me emphasise the fact that in the United Kingdom, and I will go further, and say in the whole of the countries of the Allies, we are dependent to an enormous extent on the services of neutral shipping. If we drive away out of those sixty-seven ships from these ports the twenty-one to twenty-four which are neutral, we should starve, and it would not be a question of paying 65s., or 75s., or 90s., but it would be a question of not having food left, of not having minerals to make our munitions, of not having timber with which to prop up our mines. If we are to embark on a system of maximum prices we must with that fact in our minds, have them so high as to be on the world level, in which case we get no direct benefit, or they must be so low as to give us, we should imagine, some sort of benefit, but by being below the world level they would actually drive those vessels away to other parts of the world, where they could get an increasingly high rate. That fact itself is of such great importance that I do ask the House when next they consider the question of maximum prices, to take it into account, and if they do, I venture to say we shall not hear much more about them.

I would like to interpolate here that if I thought we could get over these economic troubles by fixing maximum prices I would not have hesitated to do so. It would be contrary to the economic laws in which I am glad to think my hon. Friend believes, and it would be contrary to all that is natural. But we have done a good many unnatural things in connection with this War, and I should have been prepared to have done the unnatural thing of fixing maximum prices if I thought it would have been likely to bring national benefit instead of bringing us into national peril. The difference between shipping and other industries has been described. One of the dangers we are running nowadays is that of not having enough shipping for the purposes of ourselves and our Allies. I would like to point out that the task thrown upon us is not only that of feeding this country, but of keeping Italy, France, and Russia supplied. We have been doing our best to strike a balance sheet of the demands on British shipping and the supply of British shipping. I only wish that balance sheet showed a brighter result. I find that the total import trade of the United Kingdom which is definitely required, and which cannot be supplied by an increase of foreign shipping, on which we now depend, is something like 12,500,000 gross tons, and that the additional amount of tonnage required by the Allies brings that total up to an abnormally high figure which I need not name.

We are bound to consider two or three aspects of making the demand meet the supply. One is keeping or maintaining up to the maximum the supply of shipping already under our control. To-day I was asked a question by an hon. Member from Wales as to the ships transferred from the British Register during the War. From the first days of the War we were checking the transfer of British vessels. There was very little fear of their going in the early months, for the House will remember that freights were low, and, indeed, vessels which were not running on requisition rates in many particulars were not making anything. The tendency for the neutral to fly from the British shipowner was smaller, and, moreover, the price he was prepared to pay was inadequate, so that in the early months there was little chance of these vessels being transferred to a foreign flag. Moreover, such military and naval risks as were run were covered by our national insurance scheme, under which, on the payment of a premium which so far has proved on the whole to be adequate, we provided those who owned this class of property with a cover which enabled them, so far as the value of their property was concerned, to ignore the risks they had to run. It was later on, when freights began to rise, that the tendency to transfer increased. I think my hon. Friend, in asking his question, had in mind the sale of some vessels in South Wales at an abnormally high figure. I had not before me at the time, which I have now, a full list of the vessels which have been transferred to another flag. From that list, if he was thinking of South Wales vessels, I can inform him that only two of those, from Cardiff have been sold during the progress of the War. I think there was one other from Swansea. In both of those cases they were sold to owners in Greece, but under a very heavy bond, given by an English bank, that they were only to trade in a direction of which we approved, and, indeed, were actually, although under the Greek flag, to be in the supply service of the Allies. So far, indeed, as the total amount of tonnage available for this country and the Allies was concerned, that transfer was of no effect. There have been a number of other transfers of a similar nature, all prompted by peculiar circumstances, but allowed on one ground only—that of satisfying the Admiralty and the Board of Trade together that the transfer was justifiable. Let me read out a few of the reasons why vessels were transferred. A vessel was transferred to Holland because she was in fact owned by the Holland-America Line. She went there under a request from the Dutch Government to carry merchandise for the Dutch Government, and for no other purpose. A vessel was locked up in the Baltic. She was sold from a Glasgow shipowner to a Swede. She had to be sold to the Swede, otherwise she would not have been at work yet. She is now trading under the Swedish flag, adding thereby to the available tonnage for the world's service.

Sir J. WALTON

Is she running to Germany?

Mr. RUNCIMAN

Not at all. She is not running German trade. She also is run under a heavy bank bond in the supply trade of the Allies. The House need not ask her name, as if it were known there would perhaps be a stiff hunt for her in the Baltic. At present she is carrying ore from Middlesbrough, from which we make metal for the Munitions Department. We have sold several to France, a number to Japan, a fairly large number to Russia, and we have recently arranged for some of the vessels which are frozen up or blocked in the Black Sea also to be sold to Russia.

An HON. MEMBER

The White Sea.

Mr. RUNCIMAN

Yes, frozen up in the White Sea, but some of them are blocked in the Black Sea as well. These are kinds of transfers which are perfectly justifiable; indeed, it is the best method of putting these vessels to the use of the Allies in one way or another. It is true that we did not ask the House to pass the British Ships (Transfer Restriction) Act until March, 1915, but we had, as a matter of fact, been exercising these powers from the first week after the outbreak of war. The reason we had to ask the House to pass that Act was that in two instances, and only in two, had our powers been called in question, and, in order that there might be no doubt as to those powers being adequate, we asked the House to legalise what we had done and to give us power for the future. No difference was made in administration. The tightest grip has been kept on the vessels, and I submit to the House that we have not allowed the available amount of shipping to be cut down.

The suggestion has also been made that, for the service of this country and the Allies, we should recall vessels from foreign trade. This was the heresy that my hon. Friend the Member for East Edinburgh (Mr. Hogge) was criticising. I agree that in normal times to recall ships from foreign trade would be a most foolish economic action. It would reduce our invisible exports; it would reduce, if I may say so, the tribute which we draw from the parts of the world we serve; it would tend, indirectly, to cripple, to some extent, the shipbuilding industry, which serves not only our flag, but many others. But when we were thinking of the supplies of Great Britain and the Allies, and were suffering the greatest straits here from high freights, from the actual diminution of shipments, and from delays, we saw vessels, which were not always full up, running between foreign countries, where the economic need was nothing like so great. We had to weigh the needs of those foreign countries against our own, and naturally it seemed that we were bound to take steps to bring the ships in here where the demand was excessive, rather than leave them free to run between foreign countries, where the demand was nothing like so great. I think we were also entitled to consider the claims of our shipowners. Many of them have spent hundreds of thousands of pounds in building up this trade. It was a national asset. When they are charged with making high freights, let us put this on the other side of the account. They had to make their contribution by sacrificing a large part of their foreign trade, allowing their competitors to come in, in some cases for the first time, always in an increasing proportion, into this business, which had been built up by their ingenuity and their expenditure of capital. These vessels having been recalled, it is true that in some instances their places have been taken by neutrals, but not to the same extent. The only justification I can offer for having done that is that the need was greater here than abroad. The strain on the tonnage was greater here than it was abroad; and we believed we were putting that tonnage to a better use by bringing it here, even at the cost of our losing many of the financial exchange advantages of trading with foreign countries.

One of the criticisms made this afternoon is that we have a number of Committees dealing with these separate problems. Let me take one. The hon. Member who moved the Amendment suggested that we should have one authority dealing with all these questions. I have recently been looking over the work of the Licensing Committee, which, naturally, I have not time to read up day by day. I find that during the time they have sat, up to the end of the year—December—they have gone into the individual employment of no fewer than 1,355 steamers. The House can scarcely realise what an enormous amount of work that means. It was only possible for the whole of the business of those 1,355 steamers to be examined by highly expert Committees. They received their instructions; they were not allowed to dictate policy; they were given directions on which they were to work. We were only able to do that by employing for the purpose some of the most capable shipping experts this country can produce. I think the hon. Gentleman asked that we should make larger use of expert opinion and skill. Here is an example of work done by them: Many gave up their own business. They arranged to split the Committee into two halves, and to take it on week by week, sitting from half-past ten in the morning until six at night. They went into the condition of ship after ship, and I am told by those who are engaged in this traffic that the rapidity with which they did their work was such that it did not lead in any single case to such delay as would be an industrial detriment to the shipping trade. That is a considerable achievement for one Committee. To imagine that that Committee, expert and highly skilled as it is, could have undertaken other duties, is to expect too much from human capacity.

Mr. PETO

May I say, in justification of the proposal in the Amendment, that I never suggested that the Committees which were sitting were not fulfilling a most useful function? I only suggested that they should be co-ordinated under one central expert department.

Mr. RUNCIMAN

I agree with the hon. Gentleman. Their work must be co-ordinated, and that is exactly what has been done. There were three or four other authorities concerned in the use of our merchant shipping. They were all in the closest touch. Let me name them. There was the Admiralty—first of all, the Transport Department. They had to obey requisitions made on them by the Army and the Navy authorities. In making their requisitions they always daily and hourly ascertained from the Licensing Committee what was the state of every one of these thirteen hundred ships. That number, 1,355, has now been reduced to very small dimensions, and therefore the number of inquiries has been reduced. The Transport Department could not have worked in harmony with Government policy had they not kept in touch with the work of that Committee day by day.

We had another Committee dealing with requisitions for foodstuffs. They, again, had to be conscious of the licences issued and the reasons for their issue, and they were day by day. They had to be well aware of the requisitions that were made by the Admiralty Transport Department, and in order that they might be well aware of them we went so far as to make two Committees composed of identically the same experts. No co-ordination could be better than having the same persons for the two tasks.

Sir J. WALTON

Could they manage the two parts?

Mr. RUNCIMAN

They certainly managed the requisitioning for food supplies so well that the only trade in the world where there has not been an abnormal rise in the rates of freight has been that very trade which they for the time being controlled. Now, in order that that work may be extended, we have asked them to do for the Argentine and River Plate trade what they have done for the North Atlantic trade. In the first place, they have diverted ships in connection with the North Atlantic trade, for it is the nearer trade. You can make better use of your tonnage and get a larger amount of goods into this country for a smaller expenditure of shipping. When the North Atlantic trade for various reasons is well supplied—and there are some people in America who seem to think we cannot go elsewhere—it is just as well that we should start requisitioning for the River Plate and the Argentine, so providing that Argentine, Australian, and Indian grain should come into competition with the grain of the Northern States of America. The other authority which deals with these matters is the Allocation Committee, or the Shipping Control Committee, as it is called, over which Lord Curzon presides. Lord Curzon is the only—I think the word "amateur" was used approbiously in the course of this Debate—the only amateur on the Committee, but he has the great advantage of being impartial. He knows from his position in the Cabinet how wide are our necessities, and how important it is that these should not be looked at either from the point of view of the shipowners or from the point of view of the merchant, or from that of the Allies, or even from the purely British point of view, but that all these considerations should be taken into account.

The Committee over which he presides is linked up with, in constant touch with, and fully provided with a knowledge of the Licensing Committee, the Requisitioning Committee, and the transport work of the Admiralty. The varied range of these, questions necessitates having a large number of organisations and groups of men at work on these various concerns, and Lord Curzon's Committee has the great advantage in one office, and from one centre, of concentrating the work of all of them. It has the supreme duty of deciding how many vessels we can spare for our various services, of criticising the use of the vessels which are allocated to the various services, and of preventing the planting of too many there and too few out here That Committee has the extremely difficult diplomatic task of deciding how many vessels we can spare for the purposes of France, or of Italy, or of Russia, and that is centralising one of the most difficult problems common to all. I would submit to the House that that is the only centralising which at the present moment can be fairly undertaken, except by the one supreme authority over Lord Curzon's Committee, and that is the Cabinet itself, which is jointly responsible for the whole management of this difficult subject.

The hon. Member who moved this Amendment said that we were now, as far as shipping was concerned, in a state of chaos. I believe his reason for saying that was that he believes the control is not tight enough. Might I ask how he would have described the state of the British mercantile marine before the War broke out? If there is chaos now, there was no control whatever before, and I challenge him to find in his vocabulary a word strong enough to describe the sort of system under which the British mercantile marine was built up! The control is now so wide and so adequate that there is no vessel which can go and trade anywhere without permission of one kind or another. The last gap in that control is filled up by the Licensing Committee having to licence vessels, not only those which run between foreign ports, but also those which run between this country and allied countries; and this gives us, I venture to say, a control which has never been equalled by any Government over their Mercantile Marine. The suggestion has been made—if not heard in the course of this Debate, at all events outside—that we in this matter would have done well to have copied the system under which the munition factories are managed. The suggestion was made that all vessels should be regarded as "controlled establishments." To apply to a ship exactly the same rules as you apply to a factory is at all times difficult; but it might be justifiable. I would like to point out, however, that in one sense of the term exactly the same system has been applied to vessels which are working for Government account as if applied to establishments on shore which are working for Government account. We do not bother about controlling any ships working for private individuals—

Mr. BOOTH

You control blast furnaces.

Mr RUNCIMAN

Yes, because they are working for the Government.

Mr. BOOTH

No, they are not.

Mr. RUNCIMAN

What does the hon. Gentleman think the pig-iron is for? The whole steel production of this country is now absolutely under the control of the Government, and allocated by them. I cannot get a rolled plate, or an angle, or a bar, or a section for a single merchant ship without getting it from the Ministry of Munitions. We control the establishments which are working for Government account. We do not control etablishments which are working for private firms.

Mr. BOOTH

Yes, you do.

Mr. RUNCIMAN

If I may say so, my hon. Friend is not quite so well informed on these matters as those of us who are members of the Government.

Mr. BOOTH

I am the chairman of a firm, and we do not supply anything to the Government, and our blast furnaces are under control.

Mr. RUNCIMAN

I should like to learn the name of the firm and to know exactly where the pig iron goes to. My hon. Friend is always well informed, and I am sure he would not attempt to mislead the House on a subject on which he is not well informed.

Mr. PRINGLE

He is wearing the badge of war work.

Mr. RUNCIMAN

Every ton of steel which is of the produced in this country now is absolutely under the control Ministry of Munitions, and only recently, if I may let the House into a secret in the allocation of steel, we have actually the Board of Trade, the Admiralty, and the Ministry of Munitions sitting together round a table to arrange how much material has to be allocated to naval and to merchant shipping purposes. So that vessels run for Government account are controlled establishments, run on Blue Book rates. Where they gave those concerned in them 10 per cent. or 20 per cent. last year they may give more than last year or less than last year, but they are absolutely under control. We have carried the matter so far that we not only control these vessels which are working for Government account, but those also which work for the Allied Governments' account. No munitions are brought across the Atlantic for France or Italy which we are not prepared to requisition vessels for—and do so! We requisition vessels for the carriage of oats and hay for the Italian and French Governments. We do not requisition vessels for Italian and French merchants, because there is no reason why our requisitioned ships should be putting profits into the pockets of any merchants in those countries. We have not regarded every ship of the mercantile marine as a controlled establishment for the simple reason that to apply rules which were devised for factories ashore, and which cannot be applied to ships which are subject to neutral competition, which are being supplemented by neutral shipping in itself doing the work for individual merchants, would be not necessarily to give to the consumer in this country the benefit of a single penny, but would actually be to give to the merchant that does work regarded as an equivalent to Government work a monetary advantage to which he is not any more entitled than any other business man. Wherever the Government is concerned, services regarded as controlled services are at a fixed rate of freight. As I said a little earlier in this discussion, maximum rates of freight might be a great danger to this country; but I should have to make one exception, and that is Government work. All Government work, and all work for Allied Governments performed by British ships is performed under Blue Book rates, is done on that basis, and is a maximum rate from which we have not departed. We have not requisitioned a single vessel for the carriage of goods belonging to the Government except only at Blue Book rates, some arranged before the War and some arranged after the War, when the general market was depleted, and a good bargain was undoubtedly made by the Admiralty—

Mr. HOUSTON

And by the Board of Trade!

Mr. RUNCIMAN

There were other two points which probably the hon. Member for Pontefract had in mind when he spoke of controlled establishments, and the use of vessels under Blue Book rates. There are two commodities which we have brought to this country under Blue Book rates—not allowing the free play of the market—and outside of munitions, and they are sugar and wheat. The whole import of sugar into this country is now conducted by a Royal Commission under Government control, and, if the truth be known, the Government have succeeded in making, a profit out of the transaction. That profit has been made undoubtedly because we used Blue Book rates for vessels for the carriage of that sugar. If open market rates had been applied it would have been impossible to supply the consumer with this sugar to anything like the level we have done. The same is true of wheat. We had 172 vessels requisitioned for the carriage of wheat at a fixed rate very much below the market level. There is sacrcely a single vessel or a refrigerating space flying the British flag which is not working under requisitioned rates.

One or two words about Italy. The hon. Gentleman who moved this Amendment to the Address made a reference to Italian trade, and he undoubtedly gave the impression to the House—I hope he will not succeed in giving it outside the House—that the high rates of freight—the appallingly high rates of freight!—which have been paid for the carriage of coal was something in the nature of tribute extracted from the Italian consumer by the British shipowner. I think it is only fair that I should point out what is the proportion of vessels flying the British flag carrying this coal out to Italy. A great deal has been heard in Italy, and also in England, of this matter. Let me first of all take the vessels from Cardiff in the six months from August, 1915, to January, 1916. During that period fifty-four British vessels carried coal from Cardiff to Italy, and 209 foreign vessels. It is absurd to imagine that those fifty-four British vessels made the rate. I have made inquiries, and I find that 209 foreign vessels actually got a higher rate of freight per vessel per ton than the British vessels.

Mr. HOUSTON

Can the right hon. Gentleman say how many of these vessels were Italian?

Mr. RUNCIMAN

I can give the number of Italian vessels for another period, but my analysis does not go so far for them as the six months. Take the three months ending 31st January. In that time eighteen vessels flying the British flag carried coal to Italy from Cardiff. There were also thirty-nine Italian vessels, thirty-five Greek, and twenty-three of other nationalities, and the foreign vessels in every case got a higher rate of freight than the British vessels. It may be said that I am taking one port alone, and that I ought to take the Tyne as well. From the Tyne the number of vessels which carried coal in the six months' period was not so great; there half the vessels were foreign and half were British. In every case the foreign vessel got a higher rate of freight than did the British vessel. It is scarcely fair that the impression should be given in Italy that British shipowners have been sucking the blood out of the coal consumer of Italy. As a matter of fact, they have played an inconspicuous part from Cardiff in the carriage of coal, and also from the North Country, where they have only had one-half of the trade in their hands, and that the least remunerative part. The matter is of such great importance that I am bringing these facts to the knowledge of the Italian Government. It is no less than mischievous that in Italy the impression should be given that England, her Ally, who has done so much for Italy, and who is still prepared to do more, has allowed any section of her trading community to batten upon the privations of her people.

I should like to say one word as to why neutrals have been obtaining higher rates of freight—not only in that connection, but in other cases. I have had these facts worked out very carefully, and if you take every bag of coal sent to the ports of the Mediterranean, there is not a single case where the foreign flag has hot been obtaining a higher rate of freight than the British.

8.0 P.M.

If you turn to grain, there is not a single place from which grain has been carried where the foreign vessel has not obtained a higher rate of freight than the British. Whether it is Greek, or Scandinavian, or Spanish, or Portuguese, or American, it matters little or nothing. In every case they have obtained a higher rate of freight than the British. The mercantile reason for that is well known to those to whom I am speaking, but it is well to repeat, that first of all we are dependent upon these neutrals for our supplies. They have put forth services, and they have certainly got more out of us for those services than have our own shipowners. I should like to point out that the shortage has been to some extent accentuated by the sudden demands, the necessarily sudden demands, which are sometimes made by the Government. I have had prepared for me in connection with the North Country, as well as in connection with other export ports, lists of vessels which, after they have arrived in the port, or were chartered for the carriage of goods out of the port, have been taken under requisition. In every case where a vessel was taken in that way the merchant was bound suddenly to fill the gap. He had a smaller range of tonnage on which to draw. He frequently had to draw—in fact, he very largely had to draw—on neutral tonnage, and in every case it went up by shillings in the ton. At the grain ports it went up more, it went up as much as 10s. in the ton.

Mr. HOUSTON

It jumped up 15s. in one day.

Mr. RUNCIMAN

The hon. Member has even understated it. In one week it jumped up 30s.

Mr. HOUSTON

Yes, I said 15s. in one day.

Mr. RUNCIMAN

That is one of the difficult problems which the Government have to meet. The difficulties of the Admiralty are very great, and the demands are often sudden, but the Admiralty must supply the tonnage when they are asked. It leads to all sorts of irregularities of treatment and injustice, which is frequently complained of; but in these times, where the demands must be sudden, there is no doubt that the military need is the first and predominant one, and all kinds of interests must suffer. The Admiralty is well aware of this, and we have been endeavouring to impress on Departments and on our Allies the fact that the longer the notice they can give the easier it is for us to provide the tonnage, and the less disturbance there will be in the freight markets. That is one of the first needs of the time, and I hope the other Departments supplied by the Admiralty will be prepared to give us the fullest notice and look as far ahead as possible, whether ships are needed for the carriage of food-stuffs, or of stores for the Army, or of stores for other services which are aiding us abroad.

There are some ways of easing the situation, and the first is that we must get over the congestion in our ports. Vessels have lain in the Thames for as long as five weeks, with a cargo of wheat unladen. In normal times that cargo would have been unladen probably in a week. This delay is a dead loss. In the North Atlantic trade it meant that you have to use three vessels for the work of two. In Liverpool, I am glad to say, the congestion has been largely cleared away, but in London and in some other places the delays are still excessive, and the Government took so serious a view of the slowness of discharge and handling of vessels in our British ports that they gave to the Port Transit Committee not only an advisory authority, but we gave them an executive authority, and in regard to the clearance of ports the Ports Transit Committee—one of the best Committees yet organised by the Government—has executive power even to override the local port authority. That power, I am glad to say, has not had to be much utilised. I am glad to think that in the majority of cases the mere fact of the power existing was enough to clear away the local congestion. The power may have to be used elsewhere, but that executive power is of the first importance. The Committee is centralised and complete, and the work that has been done by means of it has already aided us in the West, and I hope will aid us in the East. But let me point out some of the difficulties which they had.

It was the hon. Member for Edinburgh (Mr. Hogge), I think, who drew attention to the fact of the shortage of labour. We have lost in our great ports 40,000 dockers. Some are in munition works, some are in the Army, some have gone to Continental ports, where their efficiency and strength has added greatly to the efficiency of the Transport Service. This great diminution of labour cannot go on without their being a blockage in the docks. Some of these labourers, I am glad to think, are now coming back to us. By arrangement with the military authorities, we hope to increase the numbers especially for work in the docks of London. The same thing applies to the shortage of men on the railway. None of these men can do their work without an efficient system around the railway termini, where the work is most needed. Then there is also the question of horses. At one time it was reported to us that no less than 30 per cent. of the horses that should be plying round the docks of London were not taken out of the stable because there were not men to take them. It is quite clear that we must have these men to work. They will be as surely doing national service as if serving in the Army. That is fully recognised by the responsible military authorities. The military authorities themselves have been doing much to clear away the causes of congestion, and by arrangement with the Quartermaster-General's Department we have been getting rid of the distant examination of stores. Cloth is made up, for instance, in the West Riding of Yorkshire, say, at Dewsbury, where they make the best quality, and would be sent down to Pimlico, and there it would be stored and tested and finally sent back to Leeds—only seven miles from Dewsbury and Batley—to be made up. The military authorities have now short-circuited that. They have also short-circuited other things. I mention this in order that the House may be well aware that we are all working in the same direction, and that there is no difference between us as to the necessity of clearing up our depots and port and railways.

Now I come to the question of shipbuilding. In shipbuilding we are hampered in a direction where I am sure the House would not wish us to diminish the competition for our yards. For who are our greatest competitors in the shipbuilding yards? Why, the British Navy. The great outburst of activity of which this War has been the cause—largely due to the energy of Lord Fisher—has led to the merchant yards all over England and Scotland being used for naval purposes, while merchant vessels have been laid on one side. Many are lying on the stocks uncompleted, and others are on the water waiting to be engined. That was due to the fact that the Admiralty had first claim on these shipyards. The necessity for all kinds of craft still remains. The Admiralty are taking the widest possible view of increasing the kind of craft that will give us the greatest advantage in this War. Such activity on the part of the Admiralty has a direct bearing on the very problem under discussion. We cannot diminish their activity, but by arrangement with the Admiralty something like forty-five vessels which were nearest completion have been hurried away, while less urgent Admiralty work has been put on one side for a month, or five or six weeks. We have another 140 which have been examined, and which are now declared to be war work. We have come to the conclusion that the increase of our mercantile marine is just as necessary as war ships. Our engines are to be completed more quickly, and arrangements are being made for the supply of fitters in particular, of whom we are shortest, to be set aside for marine work, so that the completion of these vessels may be carried as far that we can replenish our losses in submarines and other vessels used for increasing the efficiency of the auxiliary fleet. In another direction we have done something in the way of restriction of imports, and I may say that no step which I have had to take since the beginning of the War have I more regretted than having to do that. It creates the most serious dislocation in all sorts of industries. It injures individual firms and traders who deserve well of their country, and I would add it also seriously injures our interests abroad. But the first necessity is that we should have enough tonnage available for the essential necessities of life, and those which are less necessary must wait until we have an ample supply of shipping to cope with them. In discussing all these problems, I ask the House to take a long view, and not a short one. I ask them to realise that without a large merchant navy at the outbreak of the War we could not have fed ourselves, without it the Navy would have been short of coal and supplies, without it we could not have maintained our Army in France, and still less could we have organised, equipped and fed our Armies at Salonika and in Egypt and Mesopotamia. Without the merchant service in its widest sense—ships and men—we could not have undertaken the work of supplying our Dominions, keeping them financially alive and placing their resources at the disposal of our Allies as well as of this country. Without the mercantile navy we could not have brought supplies from America; and the Allies who are now clamouring so loudly for ships would have got no tonnage at all but for the fact that nearly one-half of the merchant service of the world was flying the British flag. When I point out the services which have been rendered, not only by those who control the ships, but those who navigate them—and I may say that the information I have from our Marine Department is that not a single sailor has refused to sign on because of the perils of the sea—I think we may well say that one of the most disastrous calamities which could befall this country would be that it should take any step in time of war which would limit the reproductive powers of the merchant navy, which would cripple us in adding to it immediately the War is over, so as to enable us to compete with our competitors and to build up once more the auxiliary fleet on which now our Empire mainly depends.

Mr. PENNEFATHER

The right hon. Gentleman the President of the Board of Trade has explained to us how many questions are bound up in what we call the shipping problem, and he has explained the gravity of those problems. That being so, it seems to follow that it is possibly even more important than we knew that such shipping as we have should be used economically, and that there should be a stoppage of the waste in the management of our shipping which has been referred to to-day by so many hon. Members in this House. The story of the wasteful management of our shipping is not a new one. More than a year ago, on the 11th February, 1915, the present Colonial Secretary, who was then the Leader of the Opposition, brought before this House two cases in which British vessels were being wastefully and improperly employed. A month after that a case was brought before this House of the wasteful employment of no less than nine of our great seagoing vessels as places of internment for alien prisoners at a cost to this country of over £1,000,000 a year. A month after that six of those vessels were still being misused, and a month later three of them were still being misused in this way. Month after month, from February, 1915, to February, 1916, questions have been asked in this House and complaints and statements have been made regarding the wasteful use of British shipping. To-day has perhaps been the culminating point, because hon. Member after hon. Member have made statements and given instances of cases in which our vessels have been most uneconomically used. As more and more vessels are requisitioned by the Government, as fewer and fewer vessels remain for the carrying on of the ordinary commerce of the country, the more important it becomes that the strictest economy should prevail in regard to the use of those vessels, and that the waste of which we have heard should come to an end.

I would like to point out that when a vessel is misused or uneconomically used the effects of such misuse go far beyond the mere loss of money to the taxpayers of this country through paying for a vessel which is not used in the most economical manner. In that sense there is a waste, but in addition to that remains the fact that for every ton of our shipping which is locked up unnecessarily or misused the effect is to increase the rates of freight throughout the whole world, and in that way to increase the cost of our food and the necessaries of life. Every vessel which is in this way wastefully locked up loses to this country the earnings which that vessel might make in its outward voyages between one country and another, and by losing those earnings we reduce what we call our invisible exports, and we fail to reduce the rate of exchange against this country. In place of every ton of shipping which is locked up or misused in this country or uneconomically used, we have to pay for the hire of an equivalent tonnage in neutral vessels, and in that way we are paying for an invisible import or adding to the sum of money which goes out of this country, and that again puts the balance of trade against this country and assists to put the rate of exchange against us, and in that way tends to raise the cost of food in this country. It has been truly said that we have to consider the position of our shipping after the War, and every time we lock up a vessel in this country and use it wastefully and improperly, and by that means are obliged to go to the world's market and hire a neutral vessel, in that way we are building up the mercantile navy of our competitors, and we are reducing the store of our British mercantile fleet. When all these points are taken into consideration, as I hope they will be after the statements which have been made in this House during the last twelve months in regard to the wasteful use of our vessels which we have here at our disposal; when all these matters are taken into consideration together I hope the result will be that the Government will by some means or other make it absolutely impossible that British vessels can be wasted with the resultant waste of British money.

Mr. PRINGLE

I am quite sure that the House has listened with the deepest interest to the review of the economic situation which was made in the speech of the President of the Board of Trade. That speech was calculated to impress upon us at once the seriousness of the situation in which we find ourselves. While the right hon. Gentleman has impressed upon us the seriousness of this question, he has also shown I think that at least to some extent effective steps are being taken, so far as is possible by administrative action, to relieve that situation. I think that the right hon. Gentleman's speech, as well as the speech of the First Lord of the Admiralty, proved conclusively how unfortunate it is that we are discussing the present Amendment. Nobody is really interested in the form of this Amendment, because, after all, if it means anything, it is simply an approval of the principle of the action of the Government in the past, and it is the first time in my experience that any hon. Member or group of Members of this House has thought it necessary, by an Amendment to the Address, to express approval of a policy which has already been adopted. It seems to me that it would have been much more to the advantage of the discussion if we had been discussing some of the other Amendments dealing with shipping and the economic situation which are on the Paper in the names of other hon. Members. Some of them deal with the actual causes of the present situation, and they also point to what are the inevitable results of that situation so far as shipping is concerned. It is unfortunate that the First Lord of the Admiralty replied on behalf of the Admiralty before a case was made against the Admiralty; but we are extremely glad that we have now got the Parliamentary Secretary to the Admiralty to reply to a case which I think he will admit has now been made by the hon. Member for Liverpool and, in addition, by my hon. Friend the Member for East Edinburgh (Mr. Hogge). It is true that the President of the Board of Trade has dealt with certain of their contentions. He endeavoured to exonerate the Transport Department of the Admiralty for certain faults and failings which are largely a matter of complaint among the whole of the shipowners of this country. He said that, after all, he was not to blame, that it was not his methods of requisitioning which were at fault, but that it was the demands which he had to satisfy, the insistent demands on the part of the Admiralty, which made it necessary for him to act unjustly at times to certain of the shipowners from whom he had to requisition vessels. I think that the case which was made by my hon. Friend opposite (Mr. Houston) and by my hon. Friend beside me (Mr. Hogge) was one which is not covered by that. The examples which they gave were not cases where the mistakes could be attributed to the demands made by the military. We have cases of tank steamers having been requisitioned for the transport of troops. I know of three cases where tank steamers were specially fitted up for the transport of troops and were never used for that purpose at all. They were laid up for three, four, and five months without ever doing anything. Surely that cannot be excused. If the ships were required, surely the Director of Transports was clever enough to get ships that were not tank steamers for the purpose.

Mr. HOUSTON

They were very badly required for oil-tank purposes.

Mr. PRINGLE

I thank my hon. Friend. There was undoubtedly at the time a serious shortage of tank steamers, but in spite of that serious shortage we had this Department going to the expense of having these vessels, which were built for a different purpose, specially fitted up for the transport of troops, and, having had them fitted up, and fitted up from three to six months, they were sent back without ever having been used at all. That is a criticism which affects the methods of requisitioning, and it is a criticism which has been met neither by the First Lord of the Admiralty nor by the President of the Board of Trade. It is a case which my right hon. Friend the Parliamentary Secretary to the Admiralty (Dr. Macnamara) is bound to meet. I have endeavoured to ascertain as many facts as I possibly could ascertain regarding the situation so far as requisitioning is concerned, but it is not easy to do so. Shipowners will tell you of bad cases, but they say, "You must not mention names. Do not even mention the date, because they might be able to identify my steamer, and then the result of my criticism will come back upon me in increased requisitioning of my vessels." That is their feeling. I do not say that the Admiralty are deliberately doing that, but that is the state of mind of the ship-owning community in this country. I can speak of that. I do not say that the Director of Transports will deliberately do that, but it is an extremely serious thing that impression should prevail not in one port, but practically with uniformity in every port in the country. My hon. Friend opposite did not exaggerate in the slightest degree when he said that something like a reign of terror prevailed.

I have spoken to shipowners who are Members of this House. There again they said, "Oh, yes, I can give you cases. What about such-and-such a steamer?" There happened to be a steamer owned by one particular M.P., and he said, "You must not mention it." It was a steamer which had been actually requisitioned for twelve months, and out of the twelve months there were seven and a half months lost time. I have had, as a matter of fact, a dossier prepared. I got it under the condition that I should not mention the name of any particular ship in that dossier. Here it is. You can see the thickness of it. [Document exhibited.] I got it under the strict condition that I should not show it to anybody associated with the Admiralty. This deals with something like eighty ships and the experience of the working of these eighty ships by the Transport Department of the Admiralty. I have counted up the estimates of the time lost by the owners of these ships, and I find that the eighty ships referred to in these documents have lost in the aggregate twenty years' time since the beginning of the War.

Mr. HOUSTON

Twenty years' time for one steamer.

Mr. PRINGLE

Yes, twenty years' time for a single ship. That is a very strong case, and it is a case for the Transport Department of the Admiralty to answer. This is not the first time this question has been raised. My hon. Friend opposite referred to a Debate which took place in this House on 11th February, 1915. In that Debate a far more serious criticism was made on the Transport Department. A far more trenchant attack was made by the right hon. Gentleman who was then Leader of the Opposition (Mr. Bonar Law). He is now Secretary of State for the Colonies, and of course the Transport Department gets a rest. He has his eyes on the ends of the earth, and consequently we hear no further criticism. That is one of the vicious results of the Coalition. Had it not been for the Coalition, the Secretary of State for the Colonies on the other bench, where we were always pleased to see him, with his usual power would have been making the case against the Transport Department, and shipowners would have been much more willing to put information at his disposal than they are to put it at the disposal of Members on the Back Benches, because they would have known that they would have had some protection from a man who held the responsible position of Leader of the Opposition. That was why my hon. Friend on the 11th February last year was able to quote a letter from a leading Glasgow shipowner as to what had happened to one of his ships. I cannot do that just now. That leading shipowner was quite willing to provide the information, knowing that any criticism based on his letter made by the Leader of the Opposition would give him the shield of a certain protection. When that situation no longer continues, private Members of this House do not get the information in such a form as to enable them to put it before the House.

My right hon. Friend (Dr. Macnamara) complains of what I am stating, but I am not blaming the Admiralty, and am not blaming him for that state of affairs. I am not asserting for a single moment that if I told him these things he would be vindictive, or that Mr. Graeham Thomson would be vindictive. The important thing is not what he or Mr. Graeham Thomson would do, but what the shipowners believe that the Admiralty would do. No indignation expressed in this House by my right hon. Friend will get over that feeling, and it seems to me a very grave indictment against the Transport Department that you have produced a state of things such as I have described. You get general criticism in all sorts of newspapers. This morning in the "Morning Post" the shipowners' point of view in regard to the Transport Department is clearly stated: Shipowners consider that the weak spot— that is, in regard to the whole shipping problem—

is to be found in what they regard as the transport arrangements of the Admiralty itself, which, as one gentleman observed, 'are not under the control of men accustomed to the handling of shipping business, but of bureaucrats who have only begun to learn things, the full knowledge of which it has taken practical men twenty or thirty years to acquire.' That is the criticism of the shipowners. They then go on to criticise the action of the Admiralty in regard to certain accommodation, a matter referred to by my hon. Friend. Then I have a long article which appeared in a leading shipping paper called the "Siren." It is one of the leading technical papers. It has a long attack upon the Transport Department denouncing a document issued by the Department, which they describe as "Mr. Graeham Thomson's apologia." It is one of the most extraordinary documents I have ever seen, for it points out that the shipowner who is complaining of unequal treatment, who thinks he has done more in this matter than he ought to have been called upon to do, will, when he is free from requisitioning at a later date, be compensated by the higher freights which he will be able to earn. I think in those words we find a true description of the disease. It is a plain statement that the man who thinks he has been treated unfairly in the past is to be recouped by the prospect held out to him by the Director of Transports of the advantage of higher freights in the future. That is not a very hopeful sign for the rest of the people in this country. The President of the Board of Trade suggested that there was, under his system, to be a standardisation of freights, but the Director of Transports points out to the man who has been heavily requisitioned that, when he is set free, he will be able to recoup himself by the large freights he will get. Thus there seems to be some difference of opinion between the Admiralty and the Board of Trade. I think I have said enough to show that there are substantial grounds for complaint that there has been wastefulness.

I quite agree that the Director of Transports may have had in many cases to meet sudden demands which rendered it very difficult for him to act fairly as between shipowners, and, as a result of those sudden demands, he has inflicted hardship on individuals. That raises the question of military policy. I know my right hon. Friend the Secretary to the Admiralty cannot give an answer on that point. But my hon. Friend the Member for East Edinburgh (Mr. Hogge) and I have both placed this in our Amendment. We put the point as to what we call ill-advised and unnecessary military operations, and in so doing we had in our mind the expeditions to the East. There is hardly anyone now who believes in the Dardanelles Expedition. I do not think even any Member of the Cabinet believes in it.

Mr. BOOTH

The Turks do!

Mr. PRINGLE

That may be so, but I would remind the House that the right hon. Baronet the Member for the City of London (Sir F. Banbury), speaking yesterday, openly denounced it. The expedition was in the Dardanelles from the month of May until December—roughly speaking, six months. On the average we had something over 100,000 men there during that period, and there was at least 400,000 tons of shipping engaged all that time on an absolutely futile and disastrous expedition. Is it wonderful, then, that we have such exorbitant freights, when you have an expedition entered upon which is not only hopeless from a military point of view, but which from an economical point of view must be ruinous to this country? And then, again, there is the case of Salonika. I do not know whether the President of the Board of Trade had that in his mind when he talked of the sudden demands made upon the Director of Transports. Certainly that expedition bears evidence of a very hasty decision. There we had to provide for 150,000 men. It may or it may not have been wise to go there when there was time to help Serbia and save the Serbians. But to go there in the middle of October, after the Serbian resistance had broken up, simply means that we are doing nothing beyond protecting the commercial interests of our French Allies. It is of no use to Serbia, yet for those 150,000 men we must have at least 600,000 tons of shipping engaged.

Mr. HOUSTON

You are not including the Egyptian and other expeditions brought about by the war with Turkey.

Mr. PRINGLE

I quite agree. But Turkey declared war against us, and with regard to Egypt, I consider that necessary from a defence point of view. I am merely talking of expeditions in respect of which I think we can make out a clear ease that they are ill-advised, and if you take the balance of national interests, I believe that view will be generally assented to. Again, there is the Bagdad Expedition, which is also making large demands upon our mercantile marine. My recommendation is that we should get out of these expeditions. We have got out of the Dardanelles, and we might have done so three months earlier. By so doing we would have saved many lives. We would have saved many of those who have died from Gallipoli fever—a disease which the soldiers call enteric fever. Simply because the present Government could not make up its mind to leave the Dardanelles when they realised that the expedition was futile we have sacrificed many lives. These are the things which my hon. Friend and I had in mind when we said that this serious economic situation was forced upon us by ill-advised military operations.

It is not enough to screen yourself to say that military demands must be met. The Government must examine military demands in the light of the whole position of the country, economic, financial and otherwise. It is because there has not been that co-relation of these things that this Government and the last Government have proved such failures. We should not otherwise have been in the position we now are in the nineteenth month of the War. These are our main grounds. We believe that this serious problem need never have arisen if the Government had faced the situation, looking at the country's interests and needs from every point of view. Had the problem been viewed as a whole we would not have had excessive and unlimited military demands, and we should not have had all this wasteful and unnecessary requisitioning by the Director of Transports. We had a Debate last year about freights, and at that time I think only 10 per cent. of our shipping had been requisitioned. I find then that prices had gone up for large tonnage by 23 per cent. and for small tonnage 21 per cent.

Mr. HOUSTON

At what date was that?

Mr. PRINGLE

On the 11th February. 1915. I find further from the "Board of Trade Gazette" published yesterday, that prices for large tonnage have now gone up to 49 per cent., an increase of 26 per cent., and for small tonnage to 24 per cent. The increase for the United Kingdom as a whole is 47 per cent. in prices, as compared with those a month before the War. It is practically 50 per cent. My hon. Friend opposite, who is so greatly interested in Italy, who is shedding tears over her hard fate and suggesting that the people of this country are exploiting her, should bear in mind that the same Return shows that in Italy the general level of prices is only 31.2 per cent. higher than in July, 1914. The increase in prices there is only 31 per cent., whereas ours is practically 50 per cent. I do not propose to go further into the larger questions which have been raised in this Debate. I think I have established our case that, in the first place, there has been wasteful requisitioning, and, in the second place, that the shortage of tonnage has been unnecessarily increased by the Government's military policy and its rash and ill-advised military expeditions. Undoubtedly that shortage of tonnage, by general consent, has led to the increase of freights. That increase in freights is a considerable factor in the rise in food prices to the extent of 50 per cent. That is the case we put to the Government. We believe that this situation can be reversed, or at least that it can be modified if you set free shipping and bring it into the market. If it is in the market, prices will begin to fall and freights will begin to fall. Even a few more ships on a particular route will make nil the difference to the freights which are charged.

Mr. HOUSTON

The hon. Member is quite correct in his view, because a few days ago a few oil ships were released, and freights immediately fell 40s.

Mr. PRINGLE

I am very much obliged to the hon. Member for reinforcing the argument. With his knowledge he is able to produce examples which I could not do on the spur of the moment. The release of a few ships is far better than increasing your control and putting yourselves more into the hands of bureaucrats. The bureaucrat is never going to do you any good. The bureaucrats requisitioning is the source of all our trouble. If we are going to adopt this Amendment, it will simply mean a hair from the dog that bit you.

Mr. PETO

That is not the Amendment. I never said a word about bureaucrats. The words in the Amendment are a contradiction of that.

Mr. PRINGLE

It is to be a matter for the expert. The expert always becomes a bureaucrat. I am surprised at the idea being adopted by the Unionist Business Committee. It is the old idea of efficiency which used to bulk so largely in Lord Rosebery's speeches about fifteen years ago. Once you put this man in an office he becomes a bureaucrat. I do not believe in that system. I believe that, as far as you can, you would do better by admitting the free play of individual action and competition. I know that under the conditions of war it is difficult to have that, and that in many cases it is impossible, but, so far as you possibly can have it, I believe you will get the best results. Certainly, in regard to a trade which is international in its character, the system of competition is the only possible system. The President of the Board of Trade admits that British ships are being withdrawn from neutral trade routes, and that neutral ships are going in and taking up those routes. What does that mean? It means that the ships which enter into those routes now will establish themselves before the end of the War, and that British shipowners will never regain their position. Wars have done that before. Before the American Civil War America had a considerable portion of the Atlantic trade. She lost it during the war and has never got it back.

Mr. HOUSTON

They are trying to get it back now.

Mr. PRINGLE

They will get it back now. When people speak of capturing German trade, and of the necessity of fighting Germany after this War, they cast their eyes on the wrong part of the map. It is on the other side of the Atlantic that we have to look for dangerous competition. We may there see the financial centre of the world; we may there also see our most serious rivals in shipping. The trade between the Plate and New York is now almost entirely in American hands. I have been told, by a man who ought to know, that a single firm, which has practically only got into the trade since the beginning of the War, has made £1,800,000 in that time. What is the result? They are adding to their fleet and buying ships as fast as they can. They are making great profits. The United States is not taking their excess profits, so that they are able to put them into new ships. It is new ships all the time. What will be the situation at the end of the War? They will not have a heavy Income Tax, but they will have all these resources; they will be able to carry all these, goods for practically nothing when the British shipowner tries to get back his own trade and when the British shipowner will have to bear an Income Tax of 5s. to 7s. 6d. in the £—[An HON. MEMBER: "Plus the Super-tax!"]. If he is lucky enough to earn Super-tax. Under these conditions, will it be possible to regain that trade? That will be the result of the control of which my hon. Friend opposite is asking for more. The less you have of it the better. The more ships you get out of the clutches of the Transport Department and the Admiralty the better. Let them get back to trade—

Mr. PETO

What about the War?

Mr. PRINGLE

Let them get back to trade during the War. We have always fought our wars by trade in the past, and won by trade. I have never heard a more foolish doctrine than that we heard from the Front Bench opposite, from the right hon. and learned Gentleman the Member for Dublin University (Sir E. Carson), whose absence we all regret. I have never heard a more foolish doctrine from anyone who is a Front Bench statesman than when he said that our trade might go so long as we could get victory. As if the maintenance of trade was not the foundation on which alone we could secure it! During the French Wars we maintained our trade as far as we could. It was from trade that we got the sinews of war then, and it is by safeguarding these things that we are going to beat Germany now. My only fear now is that with the Government diverting its attention from the old traditional policy of this country of limited military obligation and concentrating itself on a Continental policy, that by that policy it is endangering our chances of success. That is the risk we run. I do not suppose, so far as we are concerned, that the issue is to be settled on land at all. We can never hope in eighteen months, or in two or three years, to build up a military machine which will rival Germany's military machine. We are strong at sea and weak on land, and by leaving that ground upon which we are strongest and fighting not where Germany is weak, but going forth to fight Germany where she is strong, it is not that way that victory lies. It was not that way that William Pitt went to fight Napoleon. Even in the darkest days of that struggle he adhered to the old policy of this country. He was right. His successors maintained it, and they won. It is only by reverting to it and by getting rid of these useless commitments, which are draining the resources without any good to this country, which are weakening the strength of the Allies—without any good to this country, which I am now advocating that we shall conserve our economic resources and that this country will attain that victory which we all desire, and, what is far more important, that it will be able to reap the fruits of that victory.

The PARLIAMENTARY SECRETARY to the ADMIRALTY (Dr. Macnamara)

I think the House will desire that some answer should be made to the several criticisms of the Admiralty Transport Department which have been made from both sides of the House since the First Lord left. He is engaged on urgent work elsewhere, otherwise, of course, he would now be present, because he recognises, as we all do, the extreme importance of the matter now under discussion. The House will forgive me, I think even my hon. Friend (Mr. Pringle) will forgive me, if I preface the reply I can make with the fundamental proposition, which was enunciated by the First Lord at the beginning of the sitting and was rehearsed subsequently by the President of the Board of Trade, that is, that all criticism must, I think, take this into its consideration, that the Admiralty Transport Deparment is simply the servant and the agent of the Naval and Military Authority.

Mr. HOUSTON

I think I was careful in my speech not to refer to the Transport Department or the Director of Transport. I referred to the Admiralty as a Department of the Government and made the Government responsible.

Dr. MACNAMARA

Quite; but the criticism of my hon. Friend (Mr. Hogge) was surely directed against the operations of the Transport Department, for which the Admiralty is responsible. I must insist that the Transport Department is simply the servant and the agent of the Naval and Military Authority, and any criticism of its operations must bear that fact in mind and take it into full consideration. The Admiralty Transport Department cannot say to the Naval and Military Authority, "You are taking too many ships—

Mr. HOUSTON

The First Lord can.

Dr. MACNAMARA

And you are keeping them too long." It can ask questions, no doubt, and it can make suggestions, no doubt, but, whether my hon. Friends like it or not, in the matter of naval and military requirements it cannot have the last word. It has simply to receive demands and carry them out. I admit it has to carry them out as economically, as expeditiously, and as promptly as opportunity permits. It must keep a close hand on rates of hire, and I do not think it will be denied that it has done that.

Mr. HOUSTON

Oh, yes; penny wise and pound foolish.

9.0 P.M.

Dr. MACNAMARA

And in meeting I demands made upon it it must be careful, so far as it is concerned, to see that the tonnage taken out is not allowed to lie idle, and it must be careful to see that tonnage which is no longer required for naval and military needs is promptly released for its proper avocation. If the Transport Department, fails to do these things it has to face criticism. I am here, as far as I can, on its behalf to face that criticism. I ask the House not to forget this. When the War broke out this Transport Department was confronted with demands, on behalf of the Army particularly, on a scale out of all relationship to the small transport and troop service which it had rendered in times of peace, and those demands—and I challenge contradiction of this—were on a scale which no one could conceivably have foreseen and which was never contemplated, and they have grown as the War has proceeded, and to them have had to be super-added miscellaneous demands from a number of quarters, including our own Dominions and our Allies. It is an illuminating fact that immediately before the War the personnel of the Transport Department consisted of fifty-five persons and now approaches the figure of 900. I should like to remove one evident misapprehension. I heard the word "novices" rather superciliously mentioned.

Mr. HOUSTON

rose—

Dr. MACNAMARA

I am not dealing with the hon. Member all the time. Evidently there is the view that the officers of the Transport Department are Civil servants who know nothing whatever about shipping or commercial work.

Mr. HOUSTON

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

Dr. MACNAMARA

Very well, then I am under a misapprehension. I accept that. There are these nearly 900 persons, who include amongst them persons who have practical experience of shipping and commercial work, and I will say this on their behalf, that they are all working long hours and many of them working double tides. I ask the House, further, to remember this. It has not been noted in this Debate at all, although, of course, it must have been in everyone's mind. Every single operation of the War has been conducted overseas, in some cases very long distances from our shores, and the British merchant service, to whom we owe so much, in association with the Admiralty Transport Department, acting as a sort of universal war provider and a sort of marine Army Service Corps, supplying men, stores, and munitions, have made every single one of those operations possible during all that time. I am not going to give any figures, but I am quite sure that if I did the House would be astonished as to the number of men and animals and the amount of stores, food, and ammunition and all other supplies carried, to say nothing of the auxiliary work which has been carried out by way of supplies to the men afloat.

I want to make this point, too. Not only is the volume of work enormous, but the operations in carrying it out have to be varied and constantly changed in conformity with the constantly changing and varying strategy of the War. Criticism, to assume the proper perspective, must remember that the Transport Department, for the purposes of this War, meeting demands made upon it, has requisitioned and is controlling more than one-third of the mercantile marine of this country, which is more than one-sixth of the overseas tonnage of the world. In connection, with these great operations, there must develop very important and inevitable difficulties owing to the fact that the strategical necessities of the War involve constant changes of programme at short notice. The President of the Board of Trade I think referred to that fact. These changes of programme at short notice render it quite impossible to prepare a programme at any long distance beforehand, which is always possible, or nearly always possible, under normal commercial conditions. I do not think anyone will deny that all these great operations have been carried out with dispatch, with efficiency, and with painstaking satisfaction in every detail. We have needed no gingering up.

Mr. HOUSTON

I never said that.

Dr. MACNAMARA

I did not say the hon. Member did say so. At any rate, the fact remains that we have needed no gingering up to secure that the Army and Navy should be served promptly and thoroughly. We have never left the Army or the Navy waiting or wanting in regard to the Transport Department. Having performed these great operations thoroughly and efficiently, we have to face criticism of another kind. What is said of us is that the Department could have done all that it has done without making such great inroads upon merchant shipping. Speaking as a mere human being, and not as a super-man, I say that if we had escaped one charge we were almost bound to be met with the other. Of course, I sympathise very much with the position that the shipping community finds itself in; but war is war. Nothing can prevent war being waste and dislocation. When ships are taken away it is only natural that both the shipowner and the general community, which is very seriously affected, as hon. Members have so eloquently pointed out, by the increased prices which follow in the wake of high freights, should regret it. So do we regret it; but there it is. It is very likely that people may be excused if they think that ships are being used wastefully when they see ships occupying berths, blocking the fairway, apparently lying idle for a considerable time, or making voyages which, from a business point of view, appear to be wholly uneconomical. I think that it is in this connection that some of the expressions about waste come in. But it must be remembered that between these great warlike operations and the everyday peaceful operations of commerce there is an inevitable gulf fixed. It is quite impossible to conduct great warlike operations with the deliberation, the careful circumspection, and the nice adjustment of interests with which peaceful commercial transactions can be carried out.

With regard to specific complaints, the hon. Member for Toxteth (Mr. Houston) and the hon. Member for East Edinburgh (Mr. Hogge) made complaints in regard to the long detention of colliers with the Fleet. It is quite true, or it may be quite true, that colliers have of ten been detained for long periods before discharging their cargoes. I must point out, however, that the Fleet must always be ready to take immediate action in contingencies which may never arise, and which frequently have not arisen. If my hon. Friends recognise that, they must not then turn round and say the colliers were doing nothing all the time. If the term "waste" is applicable to the use of tonnage in this case, I submit that it is only applicable in the sense in which it can be applied to the payment of a fire insurance premium in a year in which you do not have a fire. The hon. Member for Toxteth also referred to the fact that ships were locked up in the White Sea. He said that there were over 100 ships locked up there.

Mr. HOUSTON

made a remark which was inaudible in the Reporters' Gallery.

Dr. MACNAMARA

I must ask, Mr. Deputy-Speaker, to be allowed to continue my speech in my own way.

Mr. DEPUTY-SPEAKER (Mr. Whitley)

I would point out to the hon. Member for Toxteth that he himself made rather a heavy requisition this afternoon, and he is not entitled to a number of other voyages.

Dr. MACNAMARA

I will deal with the hon. Member's statement about the White Sea. He gave the House the idea that owing to the crass stupidity and folly of the Transport Department there are over 100 ships locked up in the White Sea. All I can say is that that statement is very far from being correct, and if the hon. Member would like to have full particulars he can have them in detail in confidence. I will take the case of the "Heliopolis," which he gave as another instance of crass stupidity and folly on the part of the Transport Department. If he makes these statements he must stand up to them. The case of the "Heliopolis" had no more to do with the Transport Department than this Treasury box. It was bought in 1913 by the Admiralty and was sent to Pembroke to be stripped and readapted as a hospital ship—a stand-by job for Pembroke Royal Dockyard. In the Royal dockyards, when there is new construction and repair work going on, some new construction which may not be urgent is styled and treated as stand-by work, so that we may have men ready to turn on at once for urgent repair work. If the War had not broken out the "Heliopolis" would have been proceeded with in the Pembroke Dockyard, but when war did break out we wanted the men for urgent war work and they were taken off. I cannot complain if hon. Members say, "Why did not you send the ship to a private yard if there was one available, or why did not you sell it at the time?" That is a very fair comment to make. I admit that she has been hanging about ever since, but it has nothing to do with the Transport Department. Blame me if you like, or blame the dockyard administration, but do not put it down to the shortcomings of the Transport Department, because it has nothing whatever to do with it. The hon. Member for North-East Lanarkshire (Mr. Pringle) suggested—in fact I think he stated—that shipowners are in a way of going about in fear and terror of someone or other; that they have a fear of something dreadful which may fall upon them. I do not understand what it is that they seem to fear. All I can say is, let them come and state their case to us. They will always be assured of a fair and courteous hearing, and they can state their case and put forward their grievances without a shadow of suspicion that any injustice or unfair treatment will be meted out to them because they have ventured to put their case or to criticise.

As regards the proportion of requisitioning to which my hon. Friend referred, of course, when war broke out, we had to take what was there, what was available and suitable and could be easily adapted. Of course, there was uneven requisitioning at the outset, though, in passing, I may say that I do not think that the shipping community objected so strongly at that time. At any rate, requisition for the Government service meant regular, continuous employment at rates which gave very fair remuneration. Of course, when the market rates went well above the Government rate, the matter naturally assumed a different complexion. To-day they are far above that rate, and that is why we have endeavoured to secure that requisitioning shall be something more approaching a simple act of even-handed justice. For the past twelve months we have had the assistance of a very able Advisory Committee originally consisting of three members, and now consisting of six, who have been at work on this matter. The advice and assistance which they have given us have been invaluable. I am sorry that I have been so long, but I thought it better to try to reply to the various points. That mistakes were probably made at the outset I am not prepared to deny. The urgency and magnitude of the task in hand is the answer. But everyone will admit that it would have been a vital mistake to keep the Army or Navy waiting or wanting. I agree with the President of the Board of Trade and the First Lord of the Admiralty that we are bound, as far as we can in our administration and in the national interests, to see that we do not unnecessarily detach merchant tonnage from its vital service to the State, and that particularly at this time we must obviously do all in our power to see that the employment of merchant tonnage is not wasteful or extravagantly large. All that, however, is subject to naval and military necessities. I can assure the House that the Department, with the advice of its expert committee, is constantly watching the matter, and within the limitations which the naval and military necessities impose upon us we shall do all in our power not to hold up tonnage any further than the demands of the naval and military authorities render necessary.

Mr. PETO

I beg to ask leave to withdraw the Amendment.

Mr. DEPUTY-SPEAKER

Is it your pleasure that the Amendment be withdrawn?

Mr. BOOTH

No.

Leave to withdraw Amendment with-held.

Mr. BOOTH

I should not have risen except for some remarks which have fallen from the Front Bench. I do not at all challenge the speech of my right hon. Friend (Dr. Macnamara). I was very pleased to hear one remark which he made, which was that, when the War came suddenly upon the nation, in his Department, although I think it has been the best managed, still, as he was frank enough to admit, he did make some mistakes. That is inevitable, and we respect the Admiralty for admitting it. What we are tired of is having members of the Government over and over again coming down and preaching that they are perfect. There was a great deal of that in the speech delivered to-day on this very Amendment by my right hon. Friend the President of the Board of Trade. He was far too complacent. That is why I wish to utter a word of warning. He is a West Riding Member like myself, and I have never made any remark in my life in reference to him except one of commendation and even of admiration. I do not wish to do anything else now, but the right hon. Gentleman apparently does not know that those of us who are in business scarcely spend one day of our lives without being appealed to from north, south, east and west of this country in reference to complaints against the Board of Trade, and on the very subject covered by this Amendment. I should be putting down questions every day if I obeyed the behests of my own personal business friends. But when I hear this sort of complacent speech saying that all is perfect, I wish to utter a note of warning. The business men of this country, to a large extent, of course, in this matter of shipping are gradually acquiring a horror of dealing with the Government. Although I venture to say that in some respects perhaps they are making an advance in the way of constructive socialism, yet I am sure that the traders of the nation will recoil from any proposal for placing the shipping as well as the railway under the control of the Government. My right hon. Friend the President of the Board of Trade thought that a great deal of the criticism on this subject was due to the desire that he should manage the ships as controlled establishments. He seemed to read that meaning into this Amendment, and ventured to say that he could not justify on general grounds the management of ships as ordinary munition factories. But that is not the point at all. What gave rise to that complaint, which I venture to say was not put in the House, was not in the speech of any hon. Member. What was in the mind of the President of the Board of Trade when he replied to this point was that enormous profits are being made by somebody connected with shipping. Evidently the hon. Member for Toxteth does not think that shipowners are getting any of these very large profits.

Mr. HOUSTON

I did not say so. They are getting some of it.

Mr. BOOTH

I am very glad that some shipowners are getting very large profits. The suggestion in this Amendment is that it is for the benefit of the country to have a central authority set up to control our shipping, and the right hon. Gentleman the President of the Board of Trade said that you cannot liken munition shops to ships. But the reason for the argument is financial and it deals with the profits and not with the management. Of course, a great deal of the speech of the hon. Member for Toxteth was taken up with profits. I do not propose to argue that in detail at all. I want to point out what the essential point of difference is. Of course, the President of the Board of Trade displayed his complete ignorance when he said that the Munitions Department only took over firms which were engaged on Government work. I was bound at once to contradict that, because it was utterly absurd for a Minister of the Crown to say it. No one who understands anything of the controlled establisments of this country could allow that statement to pass. Of course, it is an ex cathedra utterance from one of the infallible Cabinet Ministers. This is the real point. If the ships are controlled, if the shipowning firms are controlled, and the charterers are controlled, practically the whole profit would go to the State, which is what is done now in the controlled establishment. But fixed as they are they only pay the Excess Profits Tax. That is really the point. The President of the Board of Trade did not seem to understand it. You will never have satisfaction amongst the business part of the community while firms working side by side are under these totally different conditions. I am speaking now of something of which I have got personal knowledge. I happen to be at the head of two concerns, one of which is controlled, and where the Government are taking all the excess profits, and the other is an insurance company, where they take half the excess profits. It is of no use the Government saying that can be justified. It cannot. There is not the slightest foundation for such a hideous difference being made between the two firms. So long as that is so you will have these complaints, and you will have Amendments such as that which has been proposed by the hon. Member for Devizes.

It is time that there should be some kind of equality between the Government and the business concerns of this country. So long as we have this higgledy-piggledy method of proceeding, one Department fighting another and despising one another, as we are sometimes led to think, you will have this inequality of treatment. The whole basis with regard to control, as proposed in the Amendment, in regard to shipping, is that the State should have these profits. I am not arguing for or against that. I do not think the State will be satisfied with either of these systems, when it sees the results, therefore I cannot support the Amendment before the House. A great deal of this legislation is simply playing into the hands of our competitive enemies, not in a warlike sense but a trading sense. You are driving trade out of the country by carelessness and mismanagement—I am not accusing the Admiralty: I am dealing more with the Board of Trade—and until you think out all these problems better you will find that you are engaging in many operations which you will bitterly regret. You are wasting the substance of the country; you are wasting all the available resources of the country in very many ways. I want to say a good deal on that point, but I can do so later when we come to the general discussion on the Motion for the Address. This Debate has shown that there is a desire that the Departments of the Government should work more harmoniously together, and that we should have some strong head to make them work in harmony. The removal of this confusion and continuance of waste is just as vital to the success of this country as are the Army and Navy.

Amendment negatived.