HC Deb 03 July 1918 vol 107 cc1813-6

Order for Second Reading read.

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


Owing to the enormous demand for flax for the War Office, Admiralty, and aeroplane requirements, and the loss of the Russian and Belgian crops, which, of course, are no longer available as the area from which we have obtained our supplies, it has become essential to make a very large development of flax production within the Empire. Part of the effort we are making for earlier production is in Ireland. Arrangements have been made for a very considerable extension of flax-growing there. The banks are willing to advance the necessary money under guarantee in part by the linen industry and in part by the War Office with the consent of the Treasury. Some difficulty has arisen owing to the fact that the companies who are willing to undertake the liability strictly have no power to do so under the terms of their articles of association or instruments of incorporation. The object of this Bill is to give them the power which they do not at present possess. They could, of course, go to the Courts in the ordinary way and get an amendment of their articles of association, but it was thought fair that as we have done in the case of the munition companies so we should do in the case of these companies—that is to say, give them power by Statute without imposing upon them the obligation to go to the Courts. This Bill imposes no obligation upon anybody, but enables those willing to do so to come to the assistance of the country in the provision of a very vital commodity. That is the object of the Bill, and I hope the House will give it a Second Reading.


Naturally we understand there are very important objects of national importance which this Bill seeks to carry out, but I should rather like to hear what guarantee the War Office is to give. I refer to the estimated amount. If it cannot be given now, perhaps it can at a later time. I am dependent upon the explanation which has been given by the hon. Gentleman of the Bill, as I have studied it but briefly; but it does seem to me that the Bill is drafted in singularly wide terms. It suggests that practically any company, whatever its shareholders may say, may depart from its articles of association and do a number of things which the shareholders have not sanctioned. That may be all right in the case of the individual companies to which reference has been made, but, as I say, the Bill is drafted in very wide terms, and it seems to me that it may require some little study and some closer drafting with a view to preventing difficulties which conceivably may arise.


I have studied the Bill somewhat, and I certainly think there should be a safeguard in it. It not only enables a company to go behind its prospectus, but also outside its memorandum. There are many people who have invested in a company and who rely upon its memorandum to limit it, say, to banking, or insurance, or cotton, or coal, as the case may be, and they would not have the least idea that the directors by a resolution at a meeting could embark to any extent they like upon an enterprise of the sort referred to. I should like to make the suggestion, which I hope the Government will not consider unreasonable, that those concerned should have to apply to some Government Department before they can act—say, to the Board of Trade. As a matter of fact, most companies can, by means of their board, exercise all the powers of the company, but here you are going to give them some reason to break all their conditions and all their bonds in order to invest in flax. There should he some form or some check; they should have the consent of the Board of Trade or the Home Office; they should have to take some definite act, however moderate, whereby some independent person casts his eye over the proposed transaction, and such, I think, would avoid any possible trouble, in view of this unlimited power.


I also would like to press the right hon. Gentleman the Financial Secretary to give us some idea as to the extent of the guarantee for which, of course, this House is primarily responsible. I should also like to ask him whether this scheme contemplates growing flax alone in Ireland, which, of course, possesses a climate and certain facilities in the way of waterways which are peculiarly suitable both for the growing and milling of flax, or whether it is proposed to have considerable areas of flax growing in England and Wales? In connection with this question I should also like to ask whether it is proposed that a portion, at any rate, of this flax is to be grown with a view to the provision of linseed, which is one of the scarcest commodities in this country? We require a very large area for carrying our stocks through the winter months. I venture to hope that the right hon. Gentleman has that in mind, because no doubt he is aware there is no matter upon which the farming community is to-day more anxious than as to whether concentrated foods will be available for carrying the cattle and the sheep through the winter months, and in the succeeding years. If agriculturists have the assurance that there will be a considerable increase of home-grown linseed, and therefore of home manufacture of linseed cake, it will make the Bill popular amongst the agricultural community.


The guarantee for the scheme which is in contemplation is £600,000 guaranteed by the War Office, and £200,000 guaranteed by the linen industry. I think we may hope that no portion of the guarantee will be called up, but it is contingent upon the success or the failure of the crop. It is essential that every effort should be made to promote this system of flax-growing. In regard to the observations made by the hon. Member for Pontefract and the hon. Gentleman opposite (Mr. C. Roberts), there is perhaps some desirability that the Bill should not be too widely drawn. I shall certainly consider that point between now and the Committee stage, and, if I can meet them, I shall be very glad to do so.


Will the right hon. Gentleman tell us in what way that guarantee will be called upon? Will it take the form of taking shares in the undertaking, or in certain contingencies, if loss arises, will the country be called upon to meet that loss?


The actual money will be advanced by the banks under guarantee, as to part of it, on the liability of the War Office, and as to the other part on the liability of the linen industry. In regard to the point made by my hon. Friend behind me (Sir C. Bathurst), certainly I hope that the supply of linseed will be enlarged. All of us personally are concerned, and, as an agriculturist, I am just as much concerned as my hon. and gallant Friend in regard to this matter. The object we have in view is the production of flax, largely for the purpose of aeroplane manufacture, and largely for those canvas requirements of the War Office.

Question put, and agreed to.

Bill accordingly read a second time, and committed to a Committee of the Whole House for Monday next.—[Mr. Parker.]

The remaining Orders were read, and postponed.

Whereupon Mr. SPEAKER, pursuant to the Order of the House of the 13th February, proposed the Question, "That this House do now adjourn."


I suppose we may now take it definitely from the Parliamentary Secretary to the Treasury that the House will not sit on Friday?

Lord E. TALBOT (Joint Parliamentary Secretary to the Treasury)


Question put, and agreed to.

Adjourned accordingly at Fourteen minutes after Eight o'clock.