HC Deb 11 August 1919 vol 119 cc923-1027

Order for Second Reading read.


The PRESIDENT of the BOARD Of TRADE (Sir A. Geddes)

I beg to move, That the Bill be now read a second time. 4.0 P.M.

The Bill which we have to consider today is a carefully considered measure to deal with what all thinking men must regard as a serious evil. It contains within it an implicit definition of profiteering. Perhaps I may summarise it as follows: To profiteer is to make unreasonably large profit, all the circumstances of the case being considered, by the sale to one's fellow-citizens of an article which is one or one of a kind of common use by or for the majority of the population. That is a very important definition, because, as the House will observe, it excludes from the purview of the Bill transactions in connection with export trade.


Where are the words "unreasonably large profit" in the Bill?


They are implicit in the Bill. The words actually used in the Bill are "unreasonable profits." That meaning attaches to the word "profiteering" in bringing forward this Bill which is to check profiteering. We have been told on a great many occasions that the word "profiteering" is one which is not capable of exact definition. In reply to that I may say that there are many words in the Bill of which no exact definition is possible, where the application of the word depends on the reasonable interpretation. The introduction of the word "profiteering" into the language is really something of a landmark, for it marks an increase in the social consciousness. It shows that people on a large scale, the populace as a whole, are realising that action taken by individuals for their own benefit may be against the interests of the population as a whale, and that is indeed the case with the making of unreasonable profits in connection with articles in common use, or of a kind that is in common use. I would like for a moment to consider what are some of the effects of profiteering and what are some of the evils which flow from the making of unreasonable profits in the home market. These may readily be divided into two sets, an economic set of evils and a social set. The economic evils affect both our export and our import trade.

During the last few months every thinking man must have been impressed by our trade returns. During the last month the value of our imports exceeded the value of our exports by a rate the equivalent of something over £900,000,000 a year. Everyone present will agree that the greatest economic need of this country at the present time is to stimulate our export trade, to get a greater volume, not only in value but in every possible way, direct export and re-export. Profiteering has a very profound effect upon the export trade. Wherever the home market presents a great opportunity of profit, naturally, as it is more easily reached and more easily observed, the tendency is to concentrate on the home market at the expense of the overseas market, and that is at all times for this country an evil, but at the present time it is a very great evil, perhaps the greatest single, individual evil which flows from profiteering. There is another effect. The making of high profits acts as a magnet to draw imports to the country. It is true that at the present time there are import restrictions imposed. It is also true, and it is within the knowledge of this House, that those import restrictions were imposed in pursuance of a transitional policy which was announced as to terminate, or at least as subject to review from the 1st of September, and within the next few days the Prime Minister will be making a statement to this House as to the trade policy which is to be followed in the immediate future. I am not divulging a secret when I say—it has been said before—that after the beginning of September the restrictions on imports will be much less severe than they are now. If high prices continue in this country, and high profits are obtainable—unreasonably great profits, in some cases unconscionable profits—the pull on imports will be enormously strong, and if that would lead to a great flooding of this country with unnecessary articles and swaying the balance of our trade further against us than it is at present, that is an evil which must flow from profiteering.

Then the big economic aspects of unreasonable profits are important. Take, for example, a single transaction. Imagine an import from some country where the exchange is against us, say, of a couple of million pounds' worth of boots or shoes. If the exchange be against us, profits are high. We want boots, and we want them as cheap as we can get them, but if the profits are high, whatever amount of the profit is unreasonably high is a dead loss to us from the point of view of exchange, and has its counterpart in the fall of exchange, and, therefore, in the increase of price which has to be paid for necessaries, which have to be brought across the exchange. [An HON. MEMBER: "That does not follow! "] It does follow. It follows beyond the possibility of question, that if the exchange is forced down and goods or necessaries have to be brought across the exchange, then more of the currency of this country will have to be paid for those necessaries. These are economic evils, carrying with them in their train social evils, and one of the direct social evils consequent on profiteering is the creation of social unrest, affecting not only labour but all classes of the community. For two reasons. First, there is in the price which includes an unreasonable profit an element which should not be there, and therefore the price is high, but also because those who have to pay that price, and are pinched to pay that price, realise soon and get to know without doubt that somebody is making a large profit, and you have not only the psychological effect of paying a big price, but you have a much more profound source of irritation, the feeling that the sacrifice that is made to pay that big price is made to line someone else's pocket. And there is no room for doubt, and no Member of this House doubts, that at the present time both those feelings which I have described are contributing materially to the disturbance and disorganisation of our industrial life. More than that. The mere fact that it is known to the workers that the employers are perhaps making quite unreasonable profits, makes the workers say, "We shall not produce freely and willingly, because all we are doing is to line the pockets of these men," and therefore profiteering in that way is directly depressing production, and it is a very vital factor in that depression.

There is another factor. Never before in the history of this country have there been so many people who drew their income from the State. You have the pen- sioners who deserve every penny they get, you have the men still with the Army and with the Navy, and you have the unemployed who draw their incomes from the State. [An HON. MEMBER: "MINISTERS!"] Yes, the Ministers draw small incomes from the State. Then you have the necessary expansion of Government services. No amount of pretending that at does not exist will remove the fact that we have at the present moment a. great number of men and women who directly depend upon the State for the money with which to pay their way. And if prices are high, unreasonably high, if unreasonable profit elements are included in those prices, it all comes back on to the national purse. It simply means that there is a steady demand, an irresistible demand in the circumstances as they exist, apparently a right demand, that payment from the State shall make the individuals who are paid by the State capable of buying the necessaries of life. That is at the present time reacting profoundly upon our financial resources. So let us not minimise, let us not exaggerate either, the evil effects which flow from the making of unreasonable profits. There is a great deal of unresonable profit being made at the present time, and I do not believe that a single Member of this House doubts that statement. Within the last few days I was speaking to a large manufacturer in the North of England. He was talking about profit, and he said to me, "I am thoroughly ashamed to see the profits we are making. "He added, "I have reduced the prices that I am charging to something nearer the proper level, and that means that they are now below the prices my competitors are charging, and it means that on the existing sales I have a profit of £200,000 a year." [An HON. MEMBER: "What is the trade?"] You have not to go to these big cases only; there are cases to be found in many trades. I have seen a great many employers and manufacturers on the subject. One very level-headed, long-sighted man in one of our principal trades said that the chief thing that was the matter with his trade was that the profits were quite unreasonable.

Take a small case. Take the cost of boots and shoes. You go into the shops and you find boots and shoes priced differently in various parts of a town or city or in various parts of the country. There-are, in fact, great divergencies in price, as is quite right, but it becomes rather astonishing when in districts which are not the fashionable shopping districts you find boots and shoes priced £2 10s. and £3 per pair for a ready-made article, when something similar is and can be bought wholesale at prices varying from 15s. to 25s. per pair. It may be almost impossible to say that these are precisely the same articles, the product of precisely the same factory, but the fact remains that similar articles can be obtained wholesale at from 15s. to 25s. per pair. This morning I asked a man whom I know well, who had actually been engaged in the wholesale purchase of boots and shoes for this country, and he gave me his figures. They worked out, for wholesale purchases, at 15s. to 25s. a pair, with a 28s. maximum as the highest price per pair for similar types to those which are sold in the retail shops at the high prices I have mentioned. It certainly looks as if there was a case for a very careful investigation there, to see that there is no unreasonable profit element attached to that retail price.

Take another instance. A case came before my notice yesterday in connection with building. An estimate was obtained for certain improvements to cottage property, in order to bring cottages which were some seventy years old, up to a really decent modern standard It involved certain alterations outside. The estimate received from a firm which in the past have done the work in that particular part was £3,500. It seemed a very large sum. A careful estimate was made by an expert of everything in connection with the work that required to be done. He estimated that with a reasonable and ordinary profit the cost of the alterations at the prices of to-day should be certainly not over £2,500. Another firm was asked to take the work, and was delighted to get it. This is a case of a firm believing itself to be quite certain of getting work and putting forward a demand for a price £1.000 above that at which another firm, not so large as itself, not with such great facilities as itself, was willing to do the work. I think that is a case of unreasonable profit; and, remember, it is on cottage property, or mainly on cottage property. Those are the sort of things which we know; those are the sort of things which we are to take steps to stop, because of the evils which unreasonable profit-making on a great scale is doing. I do not pretend for one moment, nor does the Government in bringing forward this Bill pretend, that high prices are entirely due to profiteering.


Does the right hon. Gentleman suggest that repairs to cottage property would come under the provisions of this Bill?


No, of course they do not. I was merely giving an example of the mental state in which people are at the present time. High prices by themselves are not caused only by profiteering; in fact, given high prices for all, I am sure that profiteering is not the biggest element by far, and I am quite sure that the work which will have to be done under this Bill, when it becomes law, will show that a very great deal of what has been called profiteering, of what has been believed to be profiteering, is not profiteering. But is not that all to the good? Would not such a proof, where it could be given, be the very best thing to undo some of the evils which spring from an erroneous belief? On that side, too, it is necessary to cope with this thing. Of high prices we all know some of the causes. We realise that there is a scarcity of goods in the world—a scarcity of goods in this country. There is the high cost of production, great restriction or limitation, or failure, if one may use that word, in production in certain branches of industry. These things naturally and inevitably force up prices. Take the commodity of coal. There we have a direct example of scarcity forcing up the price. There is another element also in this question of the rise in prices. There is extraordinary foolish buying by people who have money in their pockets for the first time or, who, carrying some slips of paper in their pockets, think themselves wealthy and get rid of those slips of paper foolishly. That is pushing up the cost of everything—extravagance of all sorts. But that does not get rid of the fact that there is also an unreasonable profit element in these high prices, which is dangerous economically, for reasons I have shown both in connection with our export and import trade, and is dangerous socially in the effect which it causes on the minds of those who are suffering from high prices and who believe, perhaps to an unreasonable extent, that profiteering is causing) these high prices, as it is, no doubt, to some extent.

This Bill has been described as a rush and hastily conceived measure. Those who think that simply do not know what are the facts of the case. This question of profiteering has been before the Government, has been under its consideration, for many months. I myself began work on this subject, and to see what could be done, at least six months ago. It is an extraordinarily difficult thing to see what is best to be done in connection with an evil of this sort. This particular measure passed out of the departmental stage over a month ago. It was considered by an Interdepartmental Conference a month ago. It was considered by the Cabinet on the 14th of last month. It was after that consideration that the Leader of the House announced the formation of a Select Committee of this House to consider the matter, and at the same time he stated quite definitely the Government's views. Here are my right hon. Friend's words: The Government are fully alive to the seriousness of this question, and propose to set up immediately a Select Committee to examine it. In theme an time the Government are carefully considering what steps may be usefully taken by them without delay. That was stated in the House, and it was' within the knowledge of the House that the Government were proceeding simultaneously with the Select Committee to consider what could be done. The matter was considered from all sides.

Let us look at what are the possibilities in dealing with this evil. One could classify the possibilities in these oases fairly easily. You could either deal with a problem of this nature—the problem of unreasonable profit—by stepping, as it wore, inside these industries and dealing in the commodity as a Government. For example, it would be quite possible for the Government to undertake the manufacture and sale of clothing. Think how slow it would be in getting any effect on prices. It would take months and months and months before any result appeared.


It would raise prices.


An hon. Gentleman says it would raise prices. That, of course, is not the result of experience in connection with the production either of standard suits or standard boots. But I am not concerned with that method of procedure, because I think it bad. It means that the Government goes into trade and interferes with trade practices and the whole of the ordinary trade rela- tions, trade channels, and everything else. We rejected that method of procedure after careful consideration. It was strongly pressed upon us by many people that the best way to deal with the situation was actually to go into the processes of production in such things as clothes, underclothing, boots, hats, overcoats, household utensils of all sorts. That has all been pressed on us as being a good way of dealing with this evil. I do not think it is. It would have compelled an enormous Government trading machine, and it would have meant thousands of more officials, and perhaps tens of thousands of officials, and I do not believe it would have got the result. That is the only sort of thing you could do on what I may call the internal side of Government control of prices. Externally you stand outside the trade and try and regulate it in some way to see that there is no unreasonable profit on domestic sales. There are various things which you could do. For example, you could adopt such a method as that which, according to the papers, is under consideration in the United States—that is, to stamp on every article as it leaves the factory the price showing either the cost of production or the wholesale price—I am not quite clear from the papers which—and that that would remain on the article until it was finally sold retail. I do not think that would be a very good way of approaching this problem—that is, to mark an article with the actual price at which it left the factory and then that price remaining there visible up to the moment of retail sale. Though that is quite a possible way of doing it and the United States certainly contemplate doing it, and, according to the Press, probably will do it, it seems to me to have this defect, that it would inevitably lead to a complete recreation of the channels of trade.

You would have, I believe, under such a system an absolute impossibility of retail trade, because practically, broadly speaking, no one would appreciate what elements there were going to make up the difference between the wholesale price and the retail price, and they would actually refuse until they knew the price at which the goods could be retailed. You would have, therefore, the complete destruction of the channels of retail trade. There are people who think that would be a good thing, but we need not concern ourselves with that for the moment, because quite obviously the first effect of such procedure would be to take the momentum off the going machine, and, instead of getting a good result and instead of getting a reduction in price, I believe you would get a restriction of supply, and, probably, illicit dealing, so that people who had money would get the article through some other channel. Then think, too, of imported goods—and there would, I presume, be some form of stamping at the port of entry—does anyone believe that there would be no examples of incorrect stamping? I believe that such a course would lead simply to a premium on dishonesty. I do not think that is a good way of approaching the subject. It has been suggested there should be price fixation. That has been very strongly pressed on us, namely, that we should fix the price from the centre all over, a flat price, and say, "That is the price of the article." That seems to me to be almost more pernicious than the proposal I discussed a moment ago, because a flat price all over simply means that the big, efficient, well-organised firm which is prepared to sell cheaply, and can sell cheaply, because of its efficient organisation, can sell at a fixed price and make very great profits, and in some cases, I am quite sure, unreasonable profit. The little people, or the inefficient people, have the price as it is fixed, and they drift from incompetence to incompetence. That is, I think, a great criticism which can be levelled against flat - price fixation. If you reject internal control of the home trade as bad, which I think it is, and if you reject flat-price fixation as bad, and I believe it is bad, and if you reject the stamping of the wholesale price upon goods as they leave the factory, and I am sure it is bad, what have you left? You are left with this: you have either got to say, "We are powerless, we can do nothing to limit unreasonable profits, we recognise it is an evil but we can do nothing," or you can do something quite different. You can do what we propose in the Bill. I heard one hon. Member say "Nothing," and another say," This is far too much." Perhaps these statements cancel one another.

We have got here in these proposals a different scheme which we have carefully thought out for many weeks by first of all Departmental investigation, then Interdepartmental, and finally by the Cabinet, and the scheme is this, that we should have powers granted to the Board of Trade for a period of six months to investigate the costs of articles, to investigate the margin of profits that are being made, and that the information upon which those investigations are based should be confidential, and that that information should be utilised by the Board of Trade to get a real knowledge of what is going on, and of the extent of the evil, and where a glaring case is found, that the Board of Trade should be able to prosecute, and that that prosecution should be before the Court defined in the Bill, one of the ordinary Courts of the land. In order to enable the Board of Trade to cope with the mass of inquiries that must be made without increasing the bureaucracy, which we want to avoid, it is provided that the Board of Trade should be empowered to establish local committees, which, on behalf of the Board of Trade, would investigate local conditions for them, and that those committees will share with the Board of Trade, under the delegated authority of the Board of Trade, the right to prosecute where they find a glaring case, and in the case of any individual complaint to declare the price which would give, a reasonable profit and to require the seller to repay to the complainant any amount paid by the complainant in excess of that price, and in order to prevent frivolous proceedings, to compel the complainant to purchase the article at the price of which he complained. Those seem to me to be very legitimate and very reasonable powers to confer upon such bodies.


I should like to know, where there are proceedings in a Summary Jurisdiction Court in consequence of the refusal of any trader to comply with an order made by one of these committees, whether the fact that the order was so made will be the only thing to be tried by the Summary Jurisdiction Court or whether that Court will be able to retry the whole question, and to consider in point of fact whether the actual price was reasonable or unreasonable?


If my right hon. Friend will look at the Bill at the beginning of page 2, he will see that the proceedings before a Court of Summary Jurisdiction are in lieu of any of three alternative Acts.


I was referring to the power which enables the Government to demand a fine up to, I think, £50.


That is a different thing in connection with the production of information. If the Noble Lord will read he will see that the three powers which are proposed to bestow on the Board of Trade can only be exercised in lieu of the power to prosecute for the offence, but in the ease of refusal to disclose information or for giving wrong information, a penalty comes in, but the things are quite distinct. Over and above that there is a very important provision providing that in the event of any of these committees to which powers are delegated deciding that an individual is to do two of the three things I have described, he may appeal to an appeal body which will investigate the case again with the confidential information before it, and decide. That appeal body may also prosecute if it considers the case a glaring case and one of a bad typo, but, over and above these provisions, there is a further provision in the Bill which is of importance, and that is Clause 3, where the Board of Trade may, if they think fit. authorise local authorities, subject to such conditions as the Board may impose, to purchase and sell any article or articles of any class to which this Act applies, and any local" authority so authorised shall have all necessary powers for the purpose. That is a provision which is intended to allow the community to protect itself in a general way, and not by means of individual complaint against conditions of the nature of which I am talking, against cases of excessive profit-making; and that these powers in Clause 3 will be among the most useful powers conferred by the measure I firmly believe. I think experience has already gone sufficiently far to show that the community, through the exercise of powers of this nature, is able to deal with the evil of profiteering to a very considerable extent at the retail end, but, of course, not in the other parts of the course in which it may occur, and so I would say to the House that this Bill embodies what we believe to be the best possible suggestion with regard to this difficult problem of tackling the making of quite unreasonable profits. We have examined other avenues, and we have explored them thoroughly. We see great difficulties in administering fairly and fully the powers which this Bill confers, but we see far greater difficulties in approaching the problem or in seeking for a solution of the problem along any of the other lines which I have indicated, and, great as are the difficulties, great as they will be in administering the provisions of this Bill; there would be far greater difficulties and dangers arising from leaving the present position untouched. I firmly believe that it would be wrong of the Government to allow this House to disperse for a period of weeks at this time and not to ask from the House a weapon which it could use to deal with these great and, I think I may say, these admitted evils, and this weapon which we are asking for now will, I feel sure, in spite of the obvious difficulties of administration, not effect everything that we would wish. That is impossible in such a huge sphere and so complicated a problem, but it will achieve much, and I feel myself that in getting the local committees to work, committees which will have delegated to them under the proposals of the Bill the powers the Board of Trade is asking for, we may rely without any fear upon the sound common sense of the citizens of this country. It has been well said that we are a nation of shopkeepers. We are certainly a nation of traders, and people are not going to be so foolish— there may be individual mistakes—as to impose conditions that will make trade impossible. I feel perfectly confident that their sound, shrewd common sense, of which there are such reserves in the country, will make the provisions of this Bill work more smoothly than those who look at it merely from the centre might imagine, and I say more. The mere fact that it is intended that the powers should be widely delegated will really give much greater confidence in the administration of the Act, as I hope it soon may be, than if the whole of the administration were done from or at the centre.


Who are the local authorities? There is no definition of local authorities in the Bill.


Does the Bill apply to the whole of the United Kingdom?


With regard to the last point, yes, to the whole of the United Kingdom.




Yes, Ireland is still part of the United Kingdom. It applies to all parts of the country. I told the Committee we did not intend that it should apply to Ireland, but Ireland was so perturbed at not being allowed to have it applied to her that she pressed to be included.


Who is Ireland in this matter?


Speaking in this matter, it is the Government of Ireland.

Lieut. - Commander KENWORTHY

Which Government?


The Government. The whole of the United Kingdom is included in the provisions of the Bill. The local authorities are any local authorities that the Board of Trade may delegate the authority to, as it says clearly in the Bill: The Board of Trade may, as and when it appears to them necessary or expedient, establish, or require any local authority or authorities to establish," etc. But those who are actually in contemplation as the authorities to whom, in the majority of cases, such powers will be delegated are the same local authorities as those which presided over the areas laid down in the National Registration Act of 1915. There is no need, so far as the Bill is concerned—and I think it is undesirable —that it should more closely specify the statutory local authority. So we bring this Bill before the House for Second Reading. I believe we have put forward a scheme which is the best possible in the circumstances, not imagining that it is an ideal scheme, because there is no ideal scheme. It is very easy to criticise any scheme of this nature, but it is a much more difficult thing to construct a scheme of this nature which shall be administratively possible, and we believe that this is an administratively possible scheme, and that it will do much to remove the evils which do arise from the making of unreasonable profits in our domestic trade.


I beg to move, to leave out the word "now," and at the end of the Question to add the words "upon this day three months."

I think most Members of this House will be in complete agreement with the right hon. Gentleman that there has been and is still a great deal of profiteering going on in this country. He went on to say that it was desirable—and I agree with him there again—that an end should be put to that as speedily as possible. He also went on to describe the various weapons which might be used, and he dismissed all of them except the weapon which is contained in this Bill, and it is precisely because I do not believe that thin is a weapon that will go off that I rise for the purpose of moving the Motion to reject the Bill. I want to say at once, before I proceed to an examination of the principles of the Bill, that I placed that Motion on the Paper with no desire to protect profiteers. No one has a greater resentment than I against those who make, or have made, large and unreasonable profits out of the agony of this country, and no one would more gladly support real action, action genuinely designed by the Government to safeguard the interests and the pockets of the people, and especially of those of the middle classes, who to-day find the burden of living almost unendurable. I am satisfied from a close study of this Bill, which until the right hon. Gentleman made his explanation I had really assumed to be a rushed Bill, a Bill designed in a panic—in fact, I am not quite certain that he has convinced me to the contrary now, because I thought that Sub-section (2) of Clause 1 had been hurriedly dropped on the way to the printers and was not included in the Bill, which appears without a Sub-section (2) of Clause 1.


This actual draft of the Bill was done quite at the end in order to get the shortest possible Bill for the convenience of the House of Commons. That is quite a different thing from the general principle of the Bill.


I am satisfied from a close study of this Bill that it will be ineffective, that there is not enough possible good in it to counterbalance the positive harm it will cause to trade, that it embodies principles unfair and unjust from the point of view of English law, and that it will create, despite what the right hon. Gentleman has said this afternoon, another vast, expensive, and cumbrous Department, controlled solely by the Board of Trade, without reference to Parliament. Let us come to the Bill itself. It provides for the creation of a vast new bureaucracy with complete control over the greater part of our trade from the arrival of the raw material in this country, or from the production of the raw material in this country, to the point at which the manufactured article reaches the purchaser. That seems to me a very wide power, and that is to be done with a view to checking profiteering, a word which is not defined in the dictionary and which might be held to prevent the making of any profit at all, but which. for the purpose of this Bill, is defined in the Bill as the making of an unreasonable profit. There are two points of view, it seems to me, from which this Bill should be examined: Will it as it stands speedily and certainly achieve the object of preventing unscrupulous traders from enhancing prices to the detriment of the people? That is the first point, and the second point is, Can the provisions of this Bill as it is framed be put into operation without inflicting serious injury on the delicate and complex machinery under which trade and commerce are carried on? I am in entire agreement with the right hon. Gentleman and with the Government that illegitimate profit-making, if it can, should be made impossible. No one ought to be permitted to utilise the nation's necessity to exploit the people with unfair prices.

5.0 P.M.

But the point is, Will the machinery of this Bill work quickly to that end? What is to happen when this Bill becomes law? The Board of Trade, under Clause 1, automatically is to investigate prices, costs, and profit of any article declared to be of a kind in common use by the majority of the population, and it will have power to require any person to appear before these inquisitional panels, which will beset up, to furnish such information and produce such documents as may be required. Think what it covers ! It covers clothes, boots, beds, bedding, chairs, tables, pianos, shirts, underclothing, hats, cocoa, cigarettes. There is no limit. [An HON MEMBER: "Quite right!"] There is no Schedule in the Bill. [An HON. MEMBER: "Why should there be?"] I am coming to that. There is no limit to the scores upon scores of articles which are of a kind in common use by the majority of the population to-day. If you are going to investigate the prices, costs, and profit of all these things, from the beginning to the end—from the raw material to the article in the shop it can only be done through the medium of costing departments. And think of the number and size of the costing departments necessary to cover these hundreds of articles—to go methodically and meticulously through the whole range of manufacture and trading, from the sale of the raw material to the appearance of the article in the shop ! Think of the bureaucracy which has to be created to deal with this Bill! And the people in these costing departments will have to be highly-trained experts if anything like a reasonable decision is to be arrived at. They will have to investigate methods of production, of distrubution, and of sale; consider the question of quality, for profiteering can be effected even more easily by a reduction of quality than by an increase of price. Government ale is the supreme proof of that. They will have to consider what a reasonable profit should be in relation to the current value of money, the capital employed, and the risk of capital being unremunerative by reason of the cost of labour or the shortage of world supplies. In short, accurately and scientifically, these panels, or committees, or whatever the Board of Trade is going to sot up in Whitehall—unless they take a London hotel—will have to analyse the whole circumstances of trade before they can arrive at a decision as to what is a reasonable profit.

The real point of that argument is this: How long is that going to take? This Bill is only to be in force for six months. May I suggest that it will take many months at least to arrive at accurate conclusions on this point, and that the whole of the six months for which this Bill will be in force will have to be consumed in arriving at decisions? So far, therefore, as present conditions are concerned, there is not likely to be any speedy amelioration. And since the Government do not control the purchase of raw materials, when you have finished one set of costings you may, because the raw material market has entirely changed, in price and character, have to begin all over again. That is one of the great difficulties I see about this Bill—the long time which investigation must take. And during that period the unfortunate manufacturer, the wholesaler, and the retailer will be waiting to know what the Board of Trade considers a reasonable profit—waiting to know whether they have been guilty in their trading of an offence which will render them liable to a fine of £200 or to six months' imprisonment. I do suggest to hon. Members that the trader, whether he be manufacturer, wholesaler, or retailer, cannot be expected to go about, his business while he is in a state of uncertainty as to whether he is or is not breaking, or likely to break, the law. All this work of investigation, which the Board of Trade is automatically to set up the moment this Bill becomes law, will have to be gone through again when the Board receives a complaint that a profit has been made—and not only that a profit has been made, but that a profit has been sought on the sale of an article which is, in view of all the circumstances, unreasonable. Anyone can complain, and, under paragraph (b) of Clause 1, the Board of Trade has to investigate the complaint.


Has he to buy the article?


Not necessarily; but he can be made to purchase the article after they have fixed the price. Every one of the 20,000,000 adults in the country can complain. One trader, apparently, can complain of another, because if you think the profit sought on the sale of an article is too high, you can complain. Has the right hon. Gentleman conjured up in his mind the clerical staff which will be required to deal with the complaints—? And if the complaints received are to be investigated, and the parties are to be heard, has he visualised, or formed any conclusion, as to the size and number of Star Chambers which will be required for this work? I read the other day that the right hon. Gentleman, before the Select Committee, described this as a "rough-and-ready scheme." I think it is a little more rough than ready, and that it will be wholly ineffective in solving the question of high prices, while I am certain—although I am not so much, but yet I am to some extent, concerned about that—I am certain it is going to do harm to trade and to business generally, to work to the detriment of the small trader, and to complete confusion in the world of buying and selling.

To my mind, the unsound principle of the Bill does not end here. The Board of Trade, without having made any Order declaring the proper price to be charged for any article, can take proceedings against the seller (which expression is defined as including any person offering to sell) in a Court of summary jurisdiction. I see the name of my right hon. Friend the Labour Minister is on the back of the Bill. I am not a lawyer, but he is; and I want to say that such a provision seems to me to violate the principles upon which penal legislation has hitherto been. and must properly be, founded. There is no definition in this Bill of any offence, and any seller, however innocent of intention, may suddenly find himself in the position of a defendant in Police Court proceedings for doing something which has not been defined, and which he had no reason to think was an offence. The only possible definition of an offence here is that he was making an unreasonable profit. What is a reasonable profit? Are you going to take your definition of a reasonable profit the basis of the little trader, which would give enormous profits to the large dealer; or are you going to take the basis of the large dealer, which would wipe the little trader out of existence 1 And if you are going to take each case on its merits, how can you possibly accomplish the work in the. six months? Because, until you have completed this costing system, fixed your profit, and declared what is a reasonable profit, no tribunal in any part of the country will have any standard to. govern their decisions. Meanwhile, how is the trader to define a reasonable profit, and if he does so define it to his own satisfaction, how is he to guess whether the Board of Trade will agree with him? More than that. If you do not intend to define in the Bill the offence for which a trader may be fined or sent to prison—and here again the Labour Minister, with his great legal experience, may be helpful to the House—how can any information or summons or indictment be properly framed? It is surely one of the oldest principles of English law that all information laid for the purpose of a prosecution should define the offence clearly and definitely, without duplicity or uncertainty. But this Bill does not even propose to enact that the selling of an article at an excessive price is to be deemed an offence. Nor does the Bill, by its title, seek to prohibit profiteering, but merely to check it, so that, under this Clause, when a trader is summoned, the act committed by him will only be declared an offence at the end of the proceedings, when the decision of the Court is given. That will be a new, and, in my view, a vicious principle in English law—that a Court should have the duty of defining the offence as well as that of deciding whether it has been committed. It is a point which goes far beyond this Bill, and I venture—I do not want to use the word "warn"—but I venture to entreat the Government to hesitate before they begin to establish precedents of this sort, for if you once begin to establish precedents of this sort, you are, in my view, heading towards the worse characteristics of Soviet rule.

Unsound and defective as I hold this Bill to be, so far as the Board of Trade is concerned, it is even more so when you come to the provisions which enables the right hon. Gentleman to require local authorities to establish local or other committees, to whom the Board may delegate any or all of their powers, and provides that the effect of any order by a, committee under such delegated powers should be the same as that of an Order of the Board of Trade. It seems to me bad enough to have a Government Department answerable to Parliament endowed with arbitrary powers of fixing the price for any given article, and compelling the vendor to sell and the purchaser to purchase, but it is infinitely worse if these powers are to be exercised by local committees established all over the country, not necessarily by the Board of Trade themselves, but by any local authorities who may be directed by the Board of Trade to set them up. Such local committees—and as to this I have examined the Bill very closely—would apparently be answerable to nobody, though the seller, but not, it will be observed, the purchaser, would have a right of appeal to a county appeal tribunal—another set of bodies to be called into being by the Board of Trade under regulations, as yet undefined. It seems to me—and I place the view in all humility before the Gentlemen on the Front Bench who have gone into this matter—in the highest degree undesirable to place in the hands of local committees the very extensive and undefined powers contained in this Bill.

Such committees would in a great number of cases almost certainly include local tradesmen. Yet they would be given power to adjudicate upon the affairs of their rivals, and even, it would seem, upon complaints against the members of the committee, and thus to place their fellow citizens in that position in which they could be heavily fined, or sent to prison, for an offence. or for doing something the propriety of which in many cases might only be a matter of opinion. There is a power, I think—the right hon. Gentleman described it as a very fine power, and a thing that was going to relieve the situation—in Clause 3, a power under which the Board of Trade may authorise local authorities to purchase and sell any articles, and any local authority so authorised shall have all the necessary powers for the purpose. In other words, this is municipal trading in all sorts and kinds of articles. The losses, I suppose, are to come either out of the rates or from the Treasury. Is that a power which this House proposes to give to the right hon. Gentleman? I would ask this House whether, under the provisions of the Bill with, as I think I have shown, its complicated machinery, its possible 1,600 local committees—because there were 1,600 military tribunals, and I dare say they are modelled on those that have so obsessed my right hon. Friend—possibly 1,600 county appeal tribunals, this Star Chamber inquiry, its numerous costing departments, and machinery—whether it is at all likely to check that which we are calling profiteering either now or in the immediate future, and whether this measure is not on the face of it doomed to be ineffective, and likely to do a great deal of injury to trade than to benefit purchasers?

No one, as I said at the outset, is more anxious to check and kill profiteering than I am. It is a gross offence. But high prices in the circumstances of to-day do not necessarily mean profiteering, and I want to lay emphasis upon this. The price fixed by the Government can only be operative and maintained if the Government are in a position to bring supplies to the market; for you cannot control prices unless you control supplies. If we do not want to make confusion worse confounded, to make the situation worse than it is to-day, it seems to me idle to pass into law so vague and indefinite a measure as this, leaving the filling in of vital details to the Department presided over by the right hon. Gentleman. I am not sure he knows very much about trade. He may be a superman. I am told that only supermen are grown in his family. But if this Bill represents his views—and I take it he is the author of the measure—as to now-trade and profiteering are to be handled, I do not think he knows very much about trade. Let us be clear in this: If we pas. this Bill we are handing over the absolute control of the greater part of our trade to the right hon. Gentleman, just as we have handed over the control of transport to the brother of the right hon. Gentleman the Member for Cambridge(Sir E. Geddes). It is another blank cheque for the family. Really, I think we have had enough of that kind of legislation.

The only argument I have seen put forward for this Bill, and my right hon. Friend adumbrated it this afternoon, is that its passage through this House would put a stop to profiteering—that the profiteer would surrender at the first threat?

There may be a modicum of reasoning in that, so far as the small retailer of halfpennyworths of cherries is concerned, but I do not quite see in the same light the big wholesale dealers, the trust magnates, the brewery companies, and the mass production manufacturers. That may have been the belief in which this measure was framed. If it fails, as I think it will fail— if the House passes it—the blame will be on the head of the right hon. Gentleman the author of the measure, who, by the time the failure is manifest, will, I take it, be on the other side of the Atlantic lecturing, and free from the wrath that will fall upon the Government. The belief that the real profiteer will surrender immediately this Bill passes into law is not one I share, nor do I think it one worthy of the dignity of this House that it should approach a measure from the point of view of a threat. Profiteering is in the main the result of speculation which ought not in these days to be permitted. When I was at the Food Ministry we had distinct evidence of speculating in all sorts of food commodities—outside speculation. I am sure my right hon. Friend the ex-Food Controller will bear me out—distinct evidence of outside speculation forcing up prices in all kinds of foods Only on Tuesday w e had the Food Controller giving evidence before the Select Committee to the effect that sometimes foods changed hands five times, each time enhancing the price. This Bill does not deal with that. It; will not touch it. We had the President of the Board of Trade at the same Select Committee to which I have referred, when that fact was brought to his notice, telling the Committee that he did not think it possible to meet that by any preconceived scheme. Until that is met profiteering will continue. I suggest it can be met by a system of licensing dealers in all articles where you desire to keep prices free from speculation.




Yes, licences. Where it is necessary to impose a limitation of profit I suggest it can be met by Government control of the supply. This Bill does not deal with questions of that kind. To my mind it does not touch the real core of this evil of profiteering. It only provides opportunities for the small tradesmen to be made a scapegoat, while profiteers on a big scale go undetected and unpunished. It creates a central authority without a defined policy, which may attempt to function through the disjointed action of the local authorities, which will create confusion and may stop supplies, and in many cases may injure supplies, and all result in no benefit to the purchaser. It is because 1 believe this that I move that this Bill be read a second time three months hence.


I beg to second the Amendment.

I was elected to support this Government and in seconding the Motion for the rejection of this Bill it will be obvious that I am not doing so from any point of view of mere opposition. It is simply for the reason that when I read the Bill I got such a shock at the contents of it, and at the way in which it was proposed to deal with the matter, called profiteering, that I felt-it was my duty to take more than a mere passing interest in the matter. I yield to nobody in feeling that those who during the War, and during the agony of this country, made unreasonable profit out of any articles in common use were no friends to the community, and such proceedings should certainly have been put an end to at the first reasonable opportunity. When I read this Bill I realised at once it was the kind of Bill with which we have unfortunately become rather familiar dur-into the War. A Bill that does not appear to have received any measure of consideration or revision. We do not expect to find good grammar in an Act of Parliament. But when I saw on the very first line of the Bill an obvious slip in elementary grammar that would certainly have been corrected if the Bill had ever been read over, it seems a pity. When I looked at Clause 2, I found that there are, or were, two or three Sub-sections of the Clause, and that these come, or ought to come, between Clause 1 and Clause 3. I could not help thinking when I got to that point: I wonder what it is the Minister has struck out from the middle of Sub-section (2), because this important Clause has really gone somewhere, and, perhaps, if we do get the advantage of seeing that missing Clause "we might possibly see something that would help us in the matter of profiteering which is not in the rest of the Bill!

This legislation with which we are becoming, or have become, unfortunately, too familiar during the War, requires consideration in this instance. It was bad. There was a most important Act of Parliament passed one afternoon—and I note the right hon. Gentleman proposes to pass this in a couple of days, to-day and tomorrow—one Act, I say, had to be passed in the course of an afternoon during the War, and in it there was an unfortunate slip. That Act ruined a. concern with which I was connected, and incidentally the matter cost me a good many thousands of pounds personally. Of course, during the War we were obliged to submit to these things, however slipshod, provided there was an evil to be avoided or a good to be gained. We had to take these things as they were presented to us: to do our best in the general interest of the country, and be prepared to swallow any fairy tale from any Minister as to the good things that were going to result from the Bill he chose to bring forward. We had a couple of illustrations given to us by the right hon. Gentleman. He picked out boots.

I know countries not very far from here where the prices of those same boots to which the right hon. Gentleman referred are £8 and £10 per pair. I do not know whether we can stop any profiteering; certainly we cannot in those other countries. I expected that we should have had the same suggestion made to us, and some illustration given. But that question of Boots, connected as it is with all the interferences by Government Departments with the price of leather, and from whom the leather can be got, and what leather shall be allowed to be imported—all these things go to build up the retail prices of boots. The other illustration was concerning a building contract. The idea of suggesting that that was profiteering is absurd, when there may be fifty other good reasons for a high estimate at that time which were entirely outside the right hon. Gentleman's purview. It seems to me that if the right hon. Gentleman wanted two cases he might have mentioned butter and cheese, articles out of which one of the Government Departments have been profiteering to the extent of £1,800,000, with the result that we could not get a bit of butter or cheese at any price whatever. Had the right hon. Gentleman wanted another article he might have mentioned tea, out of which a Government Department has admittedly made £1,000,000, and there is an asterisk to it, which means that there is another £1,000,000 to be added when the figures come out. That is. taken out of the pockets of the poorest of the community. Are these gentlemen to be prosecuted? I think they ought to be. We never ought to have given them the power which they have used in this astounding manner, and instead of passing an Act to give them more power in some new public Department, I would ask that the existing powers should be done away with, and we ought to let things go into their normal course

The President of the Board of Trade gave us dates when the Government began to take this matter into their consideration. Curiously enough, whilst the Government were taking 80 per cent. of the excess profits, they never thought of pointing out that these people were thieves, but now that they have reduced excess profits to 40 per cent. almost in the same week, they thought it was a very wrong thing to do, and now they have to take this tax off the sooner these people cease making these profits the better. That is the sort of argument that must have weighed with the Government in arriving at this Bill. The right hon. Gentleman said that his Department had been asked to go into trade to regulate the supply and to manufacture. What did he say about that? He said that it was a bad idea, and that it was very bad for a public Department to do anything of the sort, and he proposes to carry out those principles by allowing every local district council to go into business. We might be willing to let the Board of Trade go into business, but when the right hon. Gentleman asks us to allow every local authority, including boards of guardians and rural district councils, to go in for selling meat, potatoes, and all kinds of food, I really think the limit has been reached. I yield to no man in my desire to stop profiteering, but this Bill goes about it in a wrong way. I do not believe that the distributing trades are making these profits, and the real source is higher up, and those are places which this Bill makes no attempt to reach.


I am sure my hon. Friend would not wish to remain under a misapprehension of that sort. I am afraid he does not realise that this Bill covers the whole field. My hon. Friend who moved the rejection very clearly recognised that point, and any suggestion that it only deals with retailers is really not in accordance with the provisions of the measure.


I am glad to hear that the Board of Trade propose not merely to deal with this subject through the local councils, but they are really going to take some action at the source. I suppose they have some idea how they are going about it, but I have been on a Government Committee at the Treasury for some four months past, and my opinion of their business capacity has not been increased by my experience of these. I do not think any Government source is really the right kind of machinery to set up with a. view to dealing with this evil. I believe this Bill from the very outset is doomed to be ineffective. There is no definition of the offence. What is profiteering? For an indefinite offence there is to be a £200 fine and six months' imprisonment. Drastic powers are to be vested in the Board of Trade, and who are the Board of Trade? There is a President, but we may not always have the same President, and a large number of these gentlemen are paid officials. I have for a good many years persistently raised my voice on every occasion against it when it has been proposed to vest any extraordinary powers of interfering with the liberty of the subject in any paid officials whatever in connection with any Department of the State. I have always done so because I conscientiously object to that kind of procedure.

These gentlemen have power to delegate their duties and to make regulations which are not disclosed. What are they going to be? I observe that there is no provision in this Bill under which this House is going to have any power over those regulations. I certainly think that when regulations fixing the procedure of some 1,600 or 1,800 committees which are going to be formed all over the country, and are going to receive millions of complaints about the price of half a pound of this up to the price of a piano, when we contemplate the kind of thing that is going to happen, and the millions of complaints more or less unfounded that people are going to make unofficially behind the backs of the tradesmen, we ought to see what the regulations are, and we ought to have some control over those regulations under which the local authorities are to work. I am sorry to see these powers delegated in this way with undisclosed regulations. The "Times" this morning uses this phrase with regard to the position. It says: Heaven help the magistrates and local committees and Appeal Tribunals who have got the job of working this Bill under these unknown regulations! I simply quote that as embodying exactly what I felt with regard to this Bill when I put down my Motion to reject it some days ago. You are trying a man for an offence without any attempt to define the offence. I do not know whether from a legal point of view it is possible to do it, but I believe it is. I believe an indictment could be framed. There are hon. Members who have had experience of these matters, and perhaps they will tell us. I notice that every director of every company is liable personally unless he can prove his innocence. I can understand that any director of any compay who took an illegitimate profit knowingly, and could be proved to have done so', should go to gaol. One is prepared to admit that, but that he should go to gaol unless he can prove his innocence is exactly the converse to the ordinary principle of British justice, which is that he must be sent to gaol when he has been proved to be guilty. No doubt we shall have claims made against tradesmen under the Bill, and they are to be confidential. When is the tradesman going to get information with regard to something he has sold. There is no limit. A number of complaints may be made, and he does not know who has made them or what they are. He has no means of refuting them, and as a matter of fact you are to have a Star Chamber Court set up. I should have thought that it was impossible in this twentieth century to suggest in this country that there is to be a crime manufactured of which there is no definition, and that anybody should be able to lay a complaint behind the back of a threatened man, and he would not know what the complaint is, because it is to be confidential, and not disclosed. That is carrying the thing too far, and it is time this House interfered.

It is estimated that the expenses of these tribunals will be about £50,000 for six months. There is no figure in the Bill. [An HON. MEMBER: It is in the Memorandum."]Yes, it is in the Memorandum. The President of the Board of Trade proposes to place the whole expense of these local tribunals on the local rates, but I think the local rates are just about high enough. The whole expense of investigating hundreds of thousands of complaints, travelling expenses, and everything else, are to be paid to these new rule-of-thumb committees, which will probably have some co-operators on them. I have no hostility to co-operators, but these gentlemen are to receive this money, and the expense is to come out of the rates. Probably we shall be asked to pass a financial Resolution to cover all the extra expenses of the Board of Trade, in order that these local authorities may be empowered to go into business. I suppose they will open a store and commence selling all sorts of articles.

The first thing that occurred to me when I read that these authorities were going to be allowed to trade was, Where is the capital going to come from? Is there going to be a rate to find the capital? It is all very fine to say that if there is a loss it will have to be made up out of the rates, but there is something else to be done before you find out whether there is a profit or a loss. You cannot go into business without capital, and who is going to find it? Will it have to come out of the rates? The local authorities have no power to find it, and I ask the House what is the use of putting a Clause into a Bill of this kind granting to local authorities power to go into business? There is no power of any sort or kind in the Bill enabling them to raise capital for this purpose. I have in my own Constituency a very large number of one-man-business men, keeping small shops. They were called up and had to go to the War. They did not like it, because most of them were of an advanced age and had families. From the nature of the case, they were carrying on their business single-handed, and they were called upon to make a sacrifice out of all proportion to the sacrifice of everybody else. Many of them have come back to find their business half ruined during their absence, and now, I suppose, by this Bill, enabling all kinds of old ladies to come and complain about any article bought in the shop, the right hon. Gentleman will finish the ruin of the majority of them.

What is the object of this Bill? There can be but one answer to that question. It is to hoodwink the long-suffering public into the belief—the erroneous belief—that the Government are doing something in relation to this crying evil. The Government want to be able to say, "—It is admitted that profiteering is going on, and it is admitted that it is serious. We, at all events, have provided you with the machinery to protect yourselves. We do not see our way, as a Government, to do anything, but we are establishing these local committees, and you can go and complain to them, and prosecute, and protect yourselves. "I do not believe that any grievance will ever be either properly ventilated or dealt with under the machinery of this Bill. The only utility of it will be to try and persuade the long-suffering public that something is being done for them when it is not. The Bill will cost a lot of money. It is going to create an additional bureaucracy, it will be a further interference with trade and competition, and I am satisfied that the state of affairs at the end of six months, if the Bill is passed in its present shape, will be worse than it is now. You must get at this profiteering at the source, if you are going to get at it at all. The whole of the machinery of the Bill is misconceived. The mere fact of delimiting a space is sufficient to enable the people connected with the sale of the goods to pass on the offence from one area to another. I cannot, for the life of me, see how that is capable of ending in anything but endless confusion. Large dealers and small dealers, with capital and without capital, single shops and multiple shops, all kinds of different articles, and a vast number of shops that are admittedly selling some articles below cost as an advertisement to bring people to their shops in order to sell a number of other articles at a profit—all these are complications which we cannot avoid in this subject.

I join with the President of the Board of Trade in admitting that every one of the alternatives that he himself has suggested is impossible and will not do. I may be asked, and I think it is a fair question, "Have you any right, as a supporter of the Government, to criticise this Bill and say it will not do, unless you yourself have some suggestion to make as to how you would deal with the subject? "This is my suggestion. The War is now over. There were a vast number of official interferences with trade in almost every direction necessarily imposed upon this country during the War. Every one of those restrictions has had the effect of adding to the price of the article. The majority of them have really prevented the supply rather than facilitated it in those fields where the supply has been touched. I am absolutely against the continuance of the whole of these restrictions for five minutes longer than can be helped. I believe, if they were swept away to-morrow and if once more free competition and free course of trade were allowed its proper influence in this country, that in a very short time it would stop all undue profiteering. If some is still found to be going on in some necessary or proprietary articles, then let the Treasury come here and take its fair, and more than fair, proportion of the profits of those people, and they can be readily ascertained. Those are the remedies which I would adopt, but the whole idea, as well as the whole machinery of this Bill, is entirely misconceived, and it is in that spirit and for those reasons that I second its rejection.


I rise to address the House for the second time, because I feel that I should not be doing justice to the Constituency which I represent if I did not welcome the introduction of this Bill. That Constituency is a poor one. The bulk of the people are hard-working people who have to buy in the best markets which they can The bulk of the shopkeepers are small shopkeepers, and there are a few factories in the district. On behalf of those people and on behalf of the bulk of the small shopkeepers and manufacturers, I support this Bill, and I propose to say that which I believe the bulk of the poor people of this country feel. It is time that this Government found some method of dealing with profiteering. I have listened with considerable interest to my hon. Friend the Member for Hornsey (Mr. K. Jones) and the hon. Member for one of the Divisions of Liverpool (Sir W. Rutherford). I had hoped that from two such business men we should get a more constructive measure than that which has been introduced by the Government. I thought that their criticism would not be destructive but constructive, and I have been very disappointed. On the one hand, the hon. Member for Hornsey criticised the Bill because, he said, it would create a bureaucracy and he wanted to save the State the money. On the other hand, the Seconder of the rejection resented a Government Department making a profit for the State rather than letting the profiteer himself make it, and so saving money to the people of this country. I did not find in either of those speeches anything. to justify this House in rejecting this measure.

I have asked the Government for months how they propose to remedy profiteering. I am one of their keenest critics when they do not act. If they take a long time, we say that they are a Wait-and-See Government. If they decide quickly to do some definite thing for the State, we call them hasty. I believe that my right hon. Friend the President of the Board of Trade has not only carefully considered this question himself, but has also considered it with other Ministers. I believe that the Government are anxious to solve the question of profiteering. They have been able to find only one way, but, at least, it is a way. They say to the bulk of the people of the country, "We are introducing a Bill to check profiteering." That is, at least, something definite. We propose to do it by setting up tribunals. We propose to get to the bottom of the question and find out who are the people who are charging either too high prices or giving short weight. The Proposer and the Seconder of the rejection of the Bill have suggested that it would have a very bad influence on trade and that traders generally would resent it. I hope I may be forgiven for saying that I think I know the spririt of as many business men as the Proposer and Seconder of this Resolution, and I believe that the majority of the traders of this country are most anxious that the bulk of those people who are illegitimately profiteering should be marked, so that they may be identified from those who are playing fair and square with the people, and I believe that most of them are doing so.

I do not think that the honest trader fears being dragged before a tribunal, and I am sure that the effect of this Bill on the dishonest trader, as fear only creates fear, will be to stop him doing what he is doing. The psychological effect of it on the country as a whole will be such that prices will come down where they arc unnecessarily excessive, and I am one of those who want to get prices down to as low a level as possible. The people themselves keep prices high. The very unrest which we have in the country and the very difficulties which exist keep prices quite high enough without people having to pay profiteering prices on top of them. I therefore hope that the House will give an overwhelming majority for this Bill, because it is at least a way, and it does show on the part of the Government 30me effort to get to the bottom of this matter. If it costs £50,000, as has been mentioned this afternoon, it will be worth it, if we can find out whether it is this or that group or this or that man that is profiteering, whether it is the retailer, the middleman, the wholesale dealer, or the manufacturer. I have my own idea. I believe that the bulk of it does not rest with the retailer or the manufacturer, but with the factory, the wholesaler, and the middleman, who is not governed and who does as he likes. I am sure those who know the manufacturers of this country will back me up when I say that they keenly resent the prices at which goods made in their factories under most difficult circumstances are sold to the retailers through these intermediaries. They wish they could get rid of them, but it is a very difficult problem indeed. Supposing the only result of this measure is to show the necessity for the abolition of the middleman if prices are to come down, the Government on that ground alone will be justified in introducing it, and I hope that I shall have the support of other Members this afternoon.

6.0 P.M.


I can assure my hon. Friend who has just sat down (Mr. Higham) that we on this side of the House share with him the desire to locate the profiteer and to deal with the evil of profiteering. In the remarks that I address to the House I shall endeavour, on behalf of those with whom I act. to indicate the limitations of the proposals now offered to deal with a very big and serious evil. The Government, I think, is to be congratulated at least on. one thing, and that is on having a Minister with a sufficient reserve of courage to submit proposals such as are contained in this Bill after having seen that those proposals must fall short entirely of meeting the evils with which he proposes to deal. I think the House felt, as he must have felt when be sat down, that this measure does not make. a good job of the question with which it is dealing. Almost playfully, the right hon. Gentleman assured us that this matter had been under consideration£that this Bill, the framework of its proposals, had been more or less within the keeping of the responsible heads of the Government for some months past. After listening to every word of the right hon. Gentleman's speech, I regard the Bill as no better than a half hearted device for dealing with the situation. It will be remembered that ho showed the House, in a very long statement, that there was not very much profiteering after all, that high prices must be distinguished from the profiteering that prevails, and I think he impressed the House with the conclusion that this measure, which is designed to give assurance to the consumer and to protect him against profiteering, will at least have the effect of proving to the consumer that there is very little profiteering. I am sure that that, at any rate, in the country will not be accepted as a remedy for an evil which is felt to be very big. It is a melancholy business that the House should have to consider any such question. It is a national reproach when we reflect on the sacrifices of the soldiers and of millions of other people in recent years, people who patriotically helped their country in every way£it is, I say, a melancholy fact that we should be considering the case of people who are using by-products, and taking advantage of the circumstances of the time. to exact undue money from their fellow citizens.

The House will remember that we received in the country, and in the House as well, only a few months ago, assurances of a fall in the prices of food. The assurances were so minute that exact figures were mentioned and a certain date given when the purchasing power of the average working-class family would be increased. That forecast having found no fulfilment what ever, it should be a warning to the Government against expecting too much as the result of the measure which is now brought forward. I observe, by the way, that the name of my right hon. Friend the Food Controller is not on the back of the bill, although I see the name of the Parliamentary Secretary to the Food Ministry. I submit to the House that the Government has not treated the Food Ministry according to its deserts in face of the problem which it has had to handle. It was understood, according to the announcement of my right hon. Friend the Food Controller, that he was asked to undertake the unenviable duty of winding up his Ministry. But a little experience showed how dangerous it was to take hands off, in view of the shortage and after-war conditions which enabled the creation of an artificial rise in prices against the needs and demands of the consumer. The Food Ministry, finding itself being driven further and further into difficulties, was presented with a Select Committee to inquire not. merely as to food, but as to other articles. Yet at the beginning of the labours of that Committee we had the extraordinary spectacle of the right hon. Gentleman who has introduced this measure coming into the Committee Room and in fact telling the Committee that it is of no use for the purpose for which it was appointed and that the Government had introduced a Bill to deal with the situation. So unprecedented and so drastic a step for a Minister to take should have a. fuller excuse than is to be found in this Bill. I say that the policy represented in this Bill has not been materially considered. If it had been we should have had a stronger measure, and one which would have offered a better solution.

Is this Bill meant to shield the consumer against the profiteer or is it merely a device to shield the Ministry against the public on account of the situation which has been created? If it were intended only as a shield for the Ministry it would not eventually succeed in its purpose. I reject the view that you could deal with this problem of prices or profiteering by such heroic measures as hanging the profiteer. You cannot settle this intricate problem in that way. There can, of course, be no settlement without very drastic measures. I have examined the question thoroughly, and I say you must either do it drastically or leave it alone. This Bill does neither the one thing nor the other. The right hon. Gentleman asserted that the Bill does deal with trusts and combines and with the big men at the top. I fail to find a single word which justifies the conclusion that either the committees or the tribunals which are to be established are given power in the Bill or under the regulations to be framed which will secure this end. The House should keep in mind the fact that all the agencies through which this Bill is to operate are to get their power not from the House of Commons but from regulations secretly framed at the Board of Trade, and unless under these powers you ensure that steps will be taken to deal with the big man at the top your Bill will be of no use. I find in the Bill no such powers to deal with that state of things, and surely it is a burlesque on legislation to ask the House through local tribunals or local inquiry committees to deal with the men at the top! No one more than my right hon. Friend opposite has laboured to bring to the attention of this House and the country the evils of the operations of trusts, and I should like to associate myself with the recommendation of the Committee on this matter for dealing with trusts.


If the right hon. 'Gentleman will read the Clause he will see that the Board of Trade may establish committees, or require, local authorities to establish committees, which will have power to report on trusts and other things.


I will deal with that point presently. I was about to read the recommendation of the Committee on Trusts and Combines which sat and reported on 14th April, since which, so far as I know, despite questions addressed to Ministers in this House, nothing whatever has been done to give effect to the Committee's recommendations. The Committee, by the way, stated in its conclusions that it was satisfied that trade associations and combines were rapidly increasing in this country and might within no distant period exercise a paramount control over important branches of British trade. Accordingly, the Committee recommended that it should be the duty of the Board of Trade to obtain from all available sources information as to the nature, extent and development of trusts, combines, firms, companies and agreements connected with the mining, manufacturing, trade and commercial interests, or the transport industry, with a view to the regulation of prices of commodities produced in the United Kingdom or imported into our markets, in so far as they tended to the creation of monopolies or the restraint of trade. When the Government sets a Committee to work and it works laboriously for months in dealing with certain evils and makes far-reaching recommendations its labours ought not to be set aside in this manner, nor should its conclusions be treated as though the Government had no use whatever for them. This Bill has an essential defect so far as it deals with profiteering. It deals, as a matter of fact, with the small profiteer by regulation, or by committee, or by tribunal, or by such other methods, either separately or in combination. But how is it that the Government cannot undertake to fix prices throughout from the big man down to the little trader? Surely if the intention is to deal with all, the better policy would be not to do it as this Bill proposes and to wait until some excess price has been charged or until complaint has been made, not to wait, indeed, until the offence has been committed and until wrong prices have been charged, but to start at the very beginning ! According to Clause 1 of this Bill, the Board of Trade is to have power, through the various committees or tribunals which are to be set up, to investigate prices, costs and profits, and for that purpose to require any person to appear before them and to furnish such information and to produce such documents as they may require, and then they are to have power to declare the price which would yield a reasonable profit. I take that to mean that there will be, first, some statement of an excessive charge having been imposed, that the aggrieved per-son will report a case to a committee or a tribunal, and the grievance will be that there has been an unreasonable profit made. There will be investigation, and then the tribunal will declare what a reasonable profit should be. I am suggesting to the House that the position should be reversed, and that if it is intended to deal with the whole of the traders, from the biggest to the smallest, the Government should undertake fully the task of fixing prices throughout and not leaving to the mass of the smaller traders—who in practice will be really the victims of this Bill—to the trials and the penalties which these various local committees may impose. The right hon. Gentleman, in his evidence before the Committee, fully bore out what I said the other day. This is his language as reported in the "Times": Questioned as to how far local tribunals would be empowered to act, the right hon. Gentleman said that they would be able to investigate the cost of a suit of clothes from the wool from Australia to the braid on the bottom of the trousers and the buttons on the waistcoast. He hoped that tribunals would also be able to pre-vent profiteering in beer. If all those laborious duties of investigation are to be undertaken by these local tribunals—


The right hon. Gentleman must look at the official copy of the evidence, and he would see there is a "not." The local tribunals would clearly not be able to investigate from the wool in Australia to the finished clothing.


I certainly accept that correction. I do not, however, see how it makes the Bill any better. We have practically had no statement from the right hon. Gentleman as to the agency through which investigation is to be made in regard to those bigger profiteers who are at the top. I repeat that the effect of this Bill will be to throw the weight of grievance upon the masses of the smaller trades-people and traders who come in contact with individual consumers. Those who are dealing with trusts and combines, the great wholesalers, the big dealers, and the importers, are not the people who will make any complaint at all. They are enjoying their share of whatever profiteering is going in their realm of trade. There will be no complaint made by them. The only complaints which will be put before the local tribunals are the complaints which will arise from the aggrieved feeling of the millions of consumers who regard the shopkeepers as reaping immense profits out of these very high prices. This measure, in effect, will afford a wider measure of escape for the big profiteer than he has so far had. The Government cannot have availed themselves fully of the great ability which resides in our Government Departments to produce a better measure than this, if they themselves would make up their mind on the broad policy and determine to stamp out profiteering in scores of articles, as they have virtually stamped it out in the case of most articles of food. Ninety-four per cent. of the food which is consumed is subject to a process of price-fixing from the beginning to the end. It may be that that fixing of prices gives to some food traders a rather higher amount of profit than under the free play of competition under conditions of plenty they would enjoy, but it gives them a less amount of profit than they would be able to secure, if it is no longer entirely free, under a condition of security. There are a few men perhaps in other Ministries as well as in the Ministry of Food who could frame these schemes if the main outlines of policy were settled in the minds of the Government. Let the Government, for instance, turn to a man like Sir William Beveridge and three or four of his clerks in the Ministry of Food, and ask them to frame measures —I do not mean for consultative purposes, but within the limits of the policy to which I have referred—let them leave these men free to frame schemes on the lines of that policy, a policy which would exhibit a determination to deal with the evil which this Bill will leave totally untouched.

The right hon. Gentleman has assured the House that shortly we are to have some announcement from the Prime Minister on the removal of restrictions on trade. That is an announcement which I gladly welcome. The effect of these restrictions upon trade has been to offer special opportunities to the profiteer.

They have enabled him to carry on his work without seeming to commit any offence against his fellow citizens or against the law. With that allusion, I should like to draw the attention of the House to what I think is an act of very serious neglect on the part of the Government to deal effectively with the protests repeatedly offered by Lord Emmott, who recently resigned, together with other members of his Committee, I believe, because of the virtual packing of the Committee in the interests of certain particular trades. Lord Emmott, speaking on this very topic only a day or two ago, said: The present system of arbitrary restrictions dictated by interested committees is the very worst form of Protection ever invented. He concluded with a very strong denunciation of these unnatural courses which are taken to increase the scale of profits, and which consider the interests of the people as a secondary matter. Those with whom I act on this side of the House cannot regard this Bill as meeting the emergency and the national situation which profiteering has created. We know how enormous the task is. It ought not to be left merely to a Government to decide. I remember that when we had to provide munitions, and men and money had to be obtained, and when while the War was raging, we, all of us, felt that we ought to stand shoulder to shoulder for the purposes of national safety, there were repeated conferences between the representatives of the Government, sometimes represented by the Prime Minister, and great labour and business conferences. Have we come to the end of our service in respect to what these conferences can do? The country really has not been aroused to the danger which confronts it. Pictures of bankruptcy have been painted in this House. We are reminded of our losses in respect to trade and business. We know that we are living, as it were, in a state of indebtedness which before long must come down with even greater hardship upon the shoulders of the masses of the wage-earning people. I do not want those with whom I act on this question to approach a Bill like this in any party spirit or in the spirit of any class interests, but I cannot conceal my irritation that this seemingly hasty step which has been taken will result in no more than a measure which will cause the maximum of irritation and perhaps punishment to the most innocent of the people who are engaged in the general business of shop keeping and food purveying and in the smaller avenues of providing the needs of the masses of the consumers.

The conclusion we reach is that much more drastic legislation than this will be necessary, even if during the Recess the public mind is to be reassured. No thorough remedy can be provided, short of national or international purchase of food and primary commodities, Why should the Government be ashamed of purchase if, as is alleged, it is going to fix the price—if, as is alleged, in view of grievances recorded of unreasonable profit, it is going to determine what the reasonable profit may be? The fixing of prices can be conducted with a minimum of interference, but every course suggested in this measure will afford a maximum of interference with the ordinary free play of trade in the case of all persons engaged in it. The fixing of prices and the application of control throughout is the second step essential if this grievance is to be effectively handled. As to the limiting of profits to a reasonable payment for the services of those who may act for the Government or who may only act. as importers or agents, these are days when any payment of reasonable return for services should not be permitted. The masses of the workers, in. spite of their increased wages, their advances and their bonuses, in the main are still kept at subsistence level. They have not the opportunity of conditions of shortage, up to which they have to live, to exploit the employer and to exploit the State to the same degree that the masses of the consumers can be exploited by traders.

There must be a rigid enforcement of the existing laws which are still on the Statute Book providing for a heavy fine and for imprisonment acting as deterrents against offences against the law. This House of Commons unanimously in August last agreed to a Bill which I had the honour to introduce empowering the Courts not only to fix a fine or to imprison where an offence was committed against the Regulations of the Ministry of Food, but to compel that profiteer to pay back to the State twice as much as it had been proved he had secured by any wrong prices that he had charged. It does not appear to me that full use has been made of that. I am certain that something could have been done through the offices of State to bring the various Courts of the coun- try up to a fuller use of these Acts of Parliament, which were intended as a deterrent against the offences committed against the great masses of the consumers. I do not know whether my hon. Friends who act with me on this side of the House would prefer to have this Bill to no Bill at all, but certainly we are agreed that this measure will not touch the fringe of the evil. This is not a measure justified by the speech to which we listened this afternoon. I suggest either that the grievance should be dealt with thoroughly or left alone. You will only further incense and discontent the masses of the people by measures which, after six months' trial, will leave them more irritated and will 'leave them without a remedy in face of the evils with which they are confronted. Within that period, by administrative Acts, the Government can do a great deal, oven if it only sets to work in real earnest and in sincerity to deal with the big trusts, big importers, and traders and combines. That would go a long way to allay the public dissatisfaction. I trust that the right hon. Gentleman, after he has heard, as he will hear before this Debate is finished, views from all sides of the House which, in the main, show that this Bill is totally unworthy of the occasion and totally unsuitable to the bigger of the evils, will roach the conclusion that, even with the short time at the disposal of the Government before Parliament rises, something better than this must be attempted and something better done.


I have listened with pleasure and gratitude to the observations of the right hon. Gentleman when he referred in terms of approval to the recommendations of the Committee on Trusts appointed by the Ministry of Reconstruction, of which for the last twelve months I have acted as Chairman. It was quite obvious that the right hon. Gentleman had fully made himself acquainted with the contents of the Report and the recommendations, and I cannot help thinking that if he had made himself as fully acquainted with the provisions of the Bill he would not have been led into making many of what I must characterise as mistaken criticisms of the measure. I was one of those who were consulted in the initial stages when the Bill was being framed, and the reason why I backed it and why it has given me the greatest possible satisfaction, to support it is because, in my judgment, it is intended to carry out the main recommendations of the Committee. I am quite sure this Bill is undoubtedly necessary. I have been spending the last week in Liverpool, where the air has been full of strikes and rumours of strikes, and no one can move in a disturbed area of that kind and endeavour to make himself acquainted with the causes which underlie these startling manifestations of industrial unrest without realising that a deep sense of indignation against what is regarded as profiteering is one of the most effective causes which are retarding the restoration of industrial efficiency. It is necessary that an attempt should be made to grapple with what is by some people regarded as an admitted evil and which is certainly regarded as a very serious evil by the great mass of the people. Under these circumstances there have, of course, been various suggestions as to the best course to adopt and I was interested very much in the suggestion of the hon. Gentleman (Sir W. Rutherford) and his remedy for the present inflated prices, and the general distrust with regard to what are believed to be the unfair operations of profiteering. He said the remedy was to remove all forms of control and the restrictions which have been imposed upon trade and commerce for the purposes of the War. Restore freedom of competition, let natural economic factors have free play, and the result will presently be to lower prices. The experience of the Committee on Trusts leads me, and led the members of the Committee, who represented very diverse interests—there were trade unionists, there were captains of industry, and there were even Labour Leaders like Mr. Sidney Webb—and we were quite unanimous to the conclusion that whatever remedy there may be for the high prices which have grown up during the War, you must not look to the restoration of free competition as the remedy, because we are living in a transitional era in which free competition as an effective factor for the regulation of world prices is ceasing to exist. We talk of Free Trade and free competition, but in the sense in which those words were used by Adam Smith and Victorian economists, Free Trade and free competition have ceased to exist. The choice to-day is not between control and de-control. The only choice is by whom control is to be exercised. As a factor in determining prices competition has been, and is being, rapidly replaced by combination. Prices are no longer fixed by the play of the forces of supply and demand and by the anxiety of rival traders to see who can sell the cheapest They are fixed by a combination of traders deciding who can sell the dearest. Not only is that a theoretical view, but it is a view of the truth of which we had the strongest possible confirmation at the Ministry of Food when, in response to some extent to the advice of gentlemen who hold that view, that the right thing to do is to sweep away control, we commenced some months ago, tentatively, a policy of de-control as regards foodstuffs. I will give one example. We were in possession of large stocks of oils and fats. It was suggested that we were holding them up for fear that we might incur a loss on their realisation. We embarked on a policy of de-control. We disposed of our stocks, and within a month the price of oils and fats has risen by leaps and bounds to more than double the price under control, and we had to consider what expedient we could find for undoing the mischief.

Lieut. - Commander KENWORTHY

Were not great quantities of oils sent over to Germany in bulk, and did not that put the price up?


No. We made very careful investigation into the causes of the rise, and I do not think exports to Ger-many were a substantial factor. The problem is control or de-control. It is a remarkable fact that while during the last twenty years this process of trustification, this growth of trade combines has proceeded with ever accelerating speed—and the speed has accelerated very consider-ably during the years of the War—up to the present this country alone has been in the position of having no legislation which would either enable a Government Department, or throw upon any Department of Government, the duty to act as a watchdog in the public interest for the purpose of watching the course of prices in the interests of the consumer and of ascertaining what were the factors which were operating to the detriment of the public, and therefore the Committee on Trusts recommended—and this was the whole sum and substance of their recommendations—that it should be made the duty of the Board of Trade periodically and continuously to conduct an investigation into price movements and the operations of trade combines and trusts, in the interests of the public, and realising that that would in some cases involve prolonged expert investigations, we also recommended that there should be constituted some tribunal from which the Board of Trade might really have assistance in the investigation of these matters. In a word, what we proposed was that in dealing with this problem of the trusts and the trade combines, which, as hon. Members seem to be agreed, is intimately linked up with the question of the profiteer—for, after all, the profit that is taken by the small retail shopkeeper on individual transactions is a small matter compared with the toll taken by great combines like the Meat Trust, which controls so large a proportion of imported meats. The first step was to set up machinery which should really ascertain the facts. First find out your facts and then make them known, and when the facts had been ascertained and were known then it would be time to say, as regards this trade or that, what is wanted is to fix prices, or what is wanted is to take over the importation and to purchase the supplies, or what is wanted is to prevent speculation by licensing traders. That is precisely the machinery which this Bill sets up. The only difference between this Bill and the recommendations of the Committee on Trusts is that while they extend to all articles of commerce, this Bill is intended to be directed to those articles of commerce with regard to which there is alleged to be profiteering. This is a Bill to deal immediately with an immediate evil, and to set up the minimum machinery that is necessary for that purpose. Clause I says "the Board of Trade is empowered to investigate prices, costs, and profit with regard to all articles with regard to which there is any allegation of profiteering at present."


The Select Committee.


If my right hon. Friend thinks his Select Committee was competent to do that I congratulate him on its composition. I sat upon the Committee for eighteen months, and we examined witnesses for the whole of that period and we came to the conclusion that without something like judicial powers and without abundant time at our disposal it would be farcical for any committee to attempt to institute a scientific investigation into costings, prices, and profits, and with the utmost possible respect for the Select Committee of the House of Commons, it was never set up for the purpose of conducting a scientific investigation of that kind. The process of investigation which is contemplated in this Bill is not that of a Committee seeking about for some general principle of policy. What is intended under this Bill is a machinery of investigation which will be really capable of handling in a businesslike and scientific way problems which are intensely complicated and which require very painstaking investigation if they are to be fairly and properly treated.


Where are the people who will compose these committees to be obtained from?


I should hope, and certainly contemplate, from the best business brains of this country.




The Bill says nothing about Whitehall.


The Board of Trade?


May I be allowed to continue? It is a mistake to suggest that that is in any way limited to retail prices of articles. On the contrary, the Bill is clear and explicit on that point. It is their business to investigate any complaints of unreasonable profits which are made on the sale of any articles, whether wholesale or retail.


Sub-section (a).


Sub-section (a) gives powers to the Board of Trade to investigate prices and costs and profits. Sub-section (b) says that they can receive and investigate complaints that profits are unreasonable. Upon any complaint of that kind being made, they may declare the price which would afford a reasonable profit. That is obviously a power that should be set up; a power to declare a standard of prices in regard to the wholesale as well as the retail price of any article as to which there is public complaint made and which is investigated under that Section.


The hon. Gentleman is leading the point without dealing with a point which I should like to press. The only complaints that will be made to any local tribunal will be made by individually aggrieved consumers. It is amongst the mass of consumers that grievances about profiteering are now felt. My point is that those who deal directly with trusts and with big trading companies and combines are themselves, so to speak, in the swim, and they will make no report of any grievance against anybody. That is a point which is not cleared up.


Up to the present I have been dealing with Section 1, and I have not yet come to the Section which refers to the local tribunals. Therefore, the criticism of the right hon. Gentleman is at least premature. I was going on to deal with Section 2, in which the local tribunal arises. Section 2 does not appear to have received at the hands of my right hon. Friend that close consideration which would, I think, have removed some misconception from his mind. The object of Section 2 is that the Board of Trade, faced with the necessity of conducting investigations, which, if they are to do justice, may require considerable time and considerable attention by expert testimony, are empowered to establish committees, to whom they may delegate all or any of their powers. The committees are not in any way restricted to local committees. Although I do not represent the Board of Trade, and have no authority to say what is in the mind of the Board of Trade, surely the reason why some delegation of powers to local committees is put in the Bill is obvious. While the central committees, composed of the best business brains which the country may afford, and which may be sitting in Manchester, Liverpool, or Glasgow, not necessarily in Whitehall, may be investigating on behalf of the Board of Trade such things as the operations of a milk combine or a meat trust, or the vexed question of whether it is profiteering or freight charges or unsatisfactory market arrangements that are responsible for the loss of food which is not marketed in time in some of the great central markets—while the national or central committees may be investigating these questions so far as they are concerned in the great centres of commerce, the small matters, which are nevertheless of great interest to small people, and of great interest to poor people, as to whether the retailer is following the example of his betters, or is blameless in respect of charges made against him, may be properly referred to the local committee on the spot. It is entirely within the discretion of the Board of Trade to what extent the powers are to be referred to local committees. Why anybody should assume that the Board of Trade would exercise that discretion unreasonably and leave to local committees matters which obviously ought to be determined toy the central board, or vice versâ, would throw a burden on the national committees with regard to small matters which could properly be referred, at least for investigation and report, to the local committees, I do not understand.

This is the policy of the Government. First of all, we create machinery which will enable us for the first time in the history of this country, and which will give us the only machinery we have ever had, to investigate the operations, not merely of the retail shopkeeper, but the operations of the big business concerns, and of the trade combines and of the trusts. This Bill creates machinery which can be enlarged and expanded so that there need be no unnecessary delay in the investigation of complaints, however numerous, provided, of course, that there is some primâ facie case made out, so that the time of the tribunal is not wasted by considering frivolous or unimportant complaints.


What will enable you to declare the price which is reasonably proper?


The hon. Member should not interrupt. He was listened to in absolute silence, and it is not fair to hon. Members that he should make these repeated interjections.


I hope I have satisfied the House as to the comprehensive machinery for investigating the facts. The next thing is to make the facts public. I believe that among the remedies for profiteering, by no means the least important is publicity itself. Sometimes a proper investigation of the facts will disclose as their sequel that there was no profiteering at all. If the only results of the Bill were—I am afraid it is not likely to be—to satisfy the people of this country that their belief in profiteering was a mistake, and that they were not being robbed and swindled as some of them think they are, a useful service would have been performed. The result of some investigations will be to dispel fears which are proved to be erroneous and proved to be unfounded, while in other cases investigation will disclose facts to enable us to say what kind of remedy we are going to apply. To talk as some people do about fixing prices or removing control or any general specific of that kind is what the gentlemen of the medical profession would call pure quackery. You have to diagnose the complaint first, and what is the remedy for excessive prices in one commodity is not necessarily the remedy for excessive prices in another commodity. I fit is speculation, the remedy may be the licensing of trade so as to eliminate all the unnecessary middlemen who have introduced themselves for the purpose of inflating profits to fill their own pockets. Therefore, in all cases the facts must be ascertained before we can apply the remedy. The Act takes powers to fix penalties when profiteering takes place. There has been a good deal said by right hon. Gentlemen to the effect that this Bill imposes penalties for an offence which is not defined. I should have thought that whatever criticism could be levelled at the Bill it was not open to that criticism.

The offence is defined. The offence is selling articles, whether wholesale or retail, at an unreasonable price. The criticism which is made is that this is not a sufficiently exact definition. I looked into the Library before I came into the House to refresh my memory as to the extent to which definitions of that kind form part of the structure of everyday English law. There is not a day or an hour that passes without tribunals being called upon to decide the simple question as to whether an Act is a reasonable or unreasonable Act. If it is a matter of railway and canal charges, the Act says that they must be fairly reasonable, and a tribunal is fully competent to determine that. If it is a question of the conditions under which transit has to take place on our railways, the Act says that they must be fairly reasonable, and a tribunal has to determine that. There is a Cheap Trains Act which provides, as regards the working people, that fares must be fair and reasonable. The tribunals have never found any difficulty in interpreting that. There is probably never an Assize held at the Old Bailey at which the life or death of some fellow-subject of the British Crown does not depend upon the simple answer given by the jury to the question as to whether the act was the act of a reasonable man under the circumstances. There is the question of manslaughter, the question of negligence, whether the negligence is culpable or not. Reasonable care, reasonable compensation, reasonable dili- gence, reasonable expenditure, reasonable cost, reasonable charges, reasonable fares—the whole structure of English law is full of problems the solution of which depends upon the view which the jury takes as to whether a fellow-citizen has acted reasonably or unreasonably.

If the tribunal appointed by this Bill for the purpose is competent to determine whether a man is making unreasonable profit at the expense of his fellows, I am afraid the people of this country would lose patience with the law and they might produce a much more summary and much less satisfactory method of determining whether a retailer was or was not making reasonable or unreasonable profit, and act accordingly. The powers conferred by this Bill are not, as the right hon. Gentleman (Mr. Clynes) seemed to suggest, in derogation of any of the powers of the Ministry of Food. The powers of the Ministry of Food remain untouched. So far as this Bill is concerned, it is not anticipated that food will come within its purview at all. It will only come under its purview if, in the view of the Food Controller, it is desirable that his powers should be strengthened by the powers contained, in this Bill. The powers in this Bill are additional to the existing powers, whether in the Food Ministry or any other Department of State. They are in addition to the powers under which thousands of prosecutions have taken place in the present year against people who have been guilty of offences against the regulations laid down for the protection of the public in respect of prices by the Ministry of Food. I trust my right hon. Friend will once more read the Bill, and I trust he will find, as I have found, that the Bill does, in fact, carryout the spirit and intentions of the recommendations of the Committee on Trusts, and does afford a very satisfactory framework upon which we might commence the great problem which will have to be faced in this country, as they are facing it in America, of dealing with these trade combines and trusts which, if the control of the Government is removed, are always ready to step in and control prices for us.

7.0 P.M.


I trust the House will permit me to approach this matter from a somewhat different standpoint from that on which it has been discussed already, by reason of the fact that I am a member of the Select Committee which has been so considering it. In the first place, in criticising this measure, I am relieved of any odium which might attach to the suggestion that my interests would be prejudicially affected by a Bill such as this. I have already heard it said, on the contrary, that this Bill will be a lawyers' endowment Bill, and I think that some solicitors are already beginning to say that, at last, the Prime Minister is going to do a good turn to his own profession. Consequently, I approach it purely from a public standpoint, and my sole anxiety is to take my share as a Member of the House of Commons in assisting my colleagues and the Government in doing what is, I agree, vitally necessary to be done at the present juncture in the interests of the people as a whole. In doing so I desire to recall that on the intervention in the Committee of the right hon. Gentleman who has just left the House, when I ventured to express my surprise at what he had to say I was called to task publicly for so doing, because it was thought absurd to express surprise at anything which the present Government might do. Therefore the situation, so far as I can understand it, is this, that we have not got any Government in the ordinary accepted interpretation of the word; it is more like a bureaucratic junta. We are governed by Departments, and one day one Department seems to have power and another day another Department seems to have power, and in the oscillation of the Departments we do not know which is supreme.

That, to my mind, explains the extraordinary situation presented to us during the course of the last few days. Only two or three days ago this Select Committee was appointed with a definite purpose. That was to inquire into the cost of the various articles of ordinary consumption and how far that cost was due to excessive prices. That Committee committed a fatal offence. I suppose that it was not expected to be done. I presume that it was thought that it was going to be a tame Committee, but I am glad to say that all its members from the very moment they were called together were an independent Committee. They realised the responsibility of their task, and they did what I believe the Government ought to have done long ago; they made the proceedings public, and I have far more hope from a public inquiry into the facts of the situation than I have from the private inquiry which this Bill is going to produce. That is the supreme issue between myself and the Government. I want to help the Government. This profiteering has got to stop somehow. High prices have got to be lowered. If I could think that passing this Bill would do that, I would support the measure earnestly, but because I believe that it is a sham measure and that instead of effecting this end it is going to give the people a false conception, I consider it to be dangerous rather than helpful.

The right hon. Gentleman apparently was unaware of the appointment of the Committee. Even Jove nods. [HON. MEMBERS: "Homer."] Well, Homer too, and in a lucid interval the Government for once did a sensible thing. It appointed an independent Committee to inquire into facts vital to the welfare of the people, but when the right hon. Gentleman came to the Committee and gave us to understand, after having only one day for a public inquiry, that our services were not required any longer it looked as though we had been suddenly killed by cruel and unnatural parents, and the suggestion was made at the time that we ought at once to put up as an appropriate epitaph: If so soon to be done for, What were we begun for? But I am thankful to say that, before accepting that position, the Committee realised that its parents were the House of Commons, that the Committee owed a responsibility to the House of Commons, and it came to the conclusion that it would not allow itself to commit the happy dispatch but would keep itself in existence to render what service it could both to the nation and to the House, and, having decided to take all its evidence in public, I am not at all surprised that the right hon. Gentleman, who seems to be constantly the guardian of locked boxes, did not like an inquiry which faced the facts in the light of day. I am satisfied that that is the only hope with which we can really face the responsibility of the present position. We are bound to do something. The danger is, as the Prime Minister said the other day in regard to Ireland, lest we do something which is foolish. The important thing, therefore, is to consider how we can best face the situation, and I ask that this Committee may be allowed to continue its operations, that it may have full power and authority given to it, and that it may in public ascertain the facts without which people cannot come to any conclusion as to the course which they should pursue.

I had intended to address myself to the various points in the Bill, but they have been so fully referred to that I should be only saying them over again. The point which I am trying to urge is this, following on what has already been said, that the Bill will not achieve the objects expressed and desired. It may catch a few unfortunate small traders; it may frighten a large number of traders, which is not quite the way for a Government to act. It will harass all the traders and it will disturb the whole conditions of trade in this country, and while we know, and the right hon. Gentleman admits, that it will do harm, the point is whether it will do a compensating amount of good. The Bill is different from what I anticipated it would be. When I heard the right hon. Gentleman before the Committee I thought that the Bill was primarily for the purpose of punishment. Now apparently the policy is to inquire. I ask him, if so, why be has not inquired already. Why have the details of these things not been investigated before? The difficulty has been going on for months past. The Food Controller has been inquiring all these months, and, whether he has taken the right course or the wrong course, he has been investigating the facts and trying to realise the situation, but, so far as this question relates to the Board of Trade, which has so heavy responsibilities upon its shoulders, it has not been investigated at all, and the Board of Trade only comes on the scene now to get the powers which it ought to have got, if it needed it, many months ago so as not to leave this merely to a rushed proposal at the end of the Session. The Government has gone the wrong way about the business. It ought to have made these inquiries before it proposed this Bill. It ought to have undertaken these investigations in the same way that the Food Department has done, and then if it found it vitally necessary at last to setup an inquiry the tribunal should be one that the people could trust in. The Board of Trade is suspect itself. The people of the country believe that the Government Departments have been the worst profiteers of the whole lot, and consequently they urge a public independent inquiry which looks all the facts in the face, which is independent of the Government, independent of Departments and of all the varying interests, so that the public may realise that their interests are being regarded by an absolutely independent Committee or body.

If the Government had proposed instead of this Bill such an independent public inquiry I could have understood it. It has done nothing of the kind. It has simply postponed that, because the first sub-Clause of the Bill is to investigate, and the second is to prosecute, and I put the question: Can you act on the second sub-Clause before you have completed the operation of the first? You have got to investigate before you prosecute. If you have got to do that, then many months have got to elapse before this Bill can be put into operation. I conceive that the Government has not treated this House fairly on these great issues so materially affecting the people. It ought to have been more open. It ought to have taken these things into consideration long ago, and when it was able to publish the facts then would be the time to produce this Bill for the prosecution and punishment of offenders. I recognise the difficulties to the full, I want to punish profiteers as much as the right hon. Gentleman himself does. My sole difficulty is lest the Bill should do harm instead of good. But the responsibility for the Bill rests on the Government. It has taken this course. I am not certain whether tribunals are the proper machinery to set up, but if tribunals are established they ought to be absolutely independent bodies, so that people may realise that that which is so vital to their welfare is at last being secured in the public interest. That is the ground of my opposition to this measure. I hope earnestly before we are through with it that the Government will so alter its terms as to make it more in accord with what is necessary in the public interest. If it does that, then there will be a very different attitude towards it from that which exists at the present moment.


I would much rather have given a silent vote on this Bill, but having been a member of the same Committee as the hon. Member who last spoke, and having heard whatever evidence was given, I think it incumbent on members of the Committee to give the House such assistance as they can. It is very easy to make a speech which merely laughs this Bill out of court, but we have reached the stage at which it is generally admitted that there is a very serious amount of profiteering. I am perfectly satisfied with the evidence of that. I am satisfied that there is very consider-able profiteering among retailers. The experience of the Ilford market and the reduction of prices which has taken place there shows that there is profiteering in that quarter. I had a letter myself this morning from someone who told me that having asked a tailor—it was not in my own Constituency, so I do not mind quoting it—to supply him with some cloth. The tailor said he was unable to do so, but he would certainly get some. He procured the cloth and charged 30s. a yard for it. But in sending it along, unfortunately for himself, he left in the parcel the invoice from the wholesaler, which showed that the cloth had been invoiced to the tailor at 18s. 6d. a yard. He, therefore, charged 60 per cent. profit on a transaction on which there was no risk. I think incidents of that kind are quite clearly profiteering. He made the matter more serious by offering 7s. 6d. to have the wholesaler's invoice returned to him. I am also completely satisfied, and I think the House is, that there is a considerable amount of profiteering by speculators, who come into businesses, and also that there are thoroughly unreasonable profits being made at, I dare say, every stage of the proceedings.

Having reached these conclusions near the end of the Session is it not incumbent on this House before it adjourns for the Recess to take some action? I do not feel that Members are entitled merely to offer destructive criticisms of this Bill. Of course, I can quite understand the attitude of the hon. Member who seconded the rejection of the Bill. If I understood him right he said that whatever the evils might be the remedy to be adopted by the Government was simple; that there was no remedy except to return to the free course of trade. I am not sure what he meant by that, but as he is one of the hon. Members for Liverpool I gather it was something different from Free Trade. If any hon. Member feels that there is no remedy, and that we have simply to leave things as they are, and to trust to their getting better, that is an attitude which I can understand; but that hon. Member ought in consistency to have voted against every system of control and against the whole of the food control as it exists now. As a matter of fact he is absolutely wrong upon his facts. No sooner were the restrictions removed than prices leaped up again and restrictions had to be reimposed. I think you must have a considerable measure of control, that you must have local control and central control concurrently, if you are to get the best results. I do not believe that central control and the central fixing of prices are enough by themselves. It is cumbersome, it is slow; it is necessary in some cases, but in other cases it is quite impracticable. It means, of course, the fixing of prices at every stage; hence delay. It means fixing a mean level, which undoubtedly at present is giving an unduly large rate of profit to a large number of traders. It is wholly inapplicable in cases where conditions vary between place and place and rapidly from time to time, as in the case of greengroceries, in which there is the most gross profiteering at the present time. I think, therefore, that there ought to be local powers as well as central powers for fixing prices; but the Government must continue the central control, because the local fixing can only check unnecessary profit which is being made by the retailer. On the difficulty of defining an undue profit, one is reminded of what was said of the difficulty of distinction between night and day. It may not be very easy to draw a precise distinction and to say where the one begins and the other ends, but the difference between the two is tolerably obvious. I do not think we ought to give up efforts to deal with this proposition because it is difficult on the border-line to assess what is undue profit. The Government must continue the fixing of prices at the various stages, because in that way only will we be able to avoid the intervention of unnecessary middlemen into trade, and only so will we be able to reduce the cost of the article as it comes to the retailer.

Is it not the duty of any Member faced with this position to ask himself whether, this evil having to be met, it is not incumbent on him to give this Bill a Second Reading now, to go into the question with the greatest possible detail in Committee, and in Committee to give the Government all the constructive criticism possible in order to get the right type of Bill? Some older Parliamentarians may make the point that we shall so change the Bill in Committee as to make it a Bill quite different from that now before us. It is too late in the Session to take fine points of that kind. Surely what we have to do is to get an efficient Bill and to get it now. It is sometimes said that you will get hard cases among retailers if you pass this Bill, even with proper Amendment. My answer is that if you do not pass the Bill and make an attempt to check profiteering before the House rises you twill get far more hard cases among consumers. An hon. Member on the Front Bench opposite said it was an outrageous thing for the Government to introduce the Bill now, and that they had been too slow in bringing it forward. I am not sure that it altogether lies with the lesser Liberal party to challenge the Government on that point. I think that they have not made the course of the Government very much easier in the past. They clamoured for the removal of restrictions, and now they clamour for the restrictions to be put on again. I am not concerned to defend the Government. Perhaps they have been slow; perhaps they ought to have done this sooner. I think they ought, but surely that is a poor reason for not getting on with this Bill at the eleventh hour.

There are some points on which I hope the Government will throw a little more light. I think we have got to make this Bill as definite and as clear upon the face of it as we possibly can. The House, I feel sure, will be averse from leaving matters to be dealt with by Regulation, especially if Regulations are to be passed at a time when the House will not be here to deal with them. I think a great deal more detail will have to be put into this Bill in Committee so that the House and the traders may know what the intentions of the Government are. I think it ought to be stated clearly in a Schedule to the Bill what are the articles to which it applies. They are susceptible of a perfectly clear definition. Every trader will then know where he stands. Secondly, I want to know, with precision, what are the powers which the Board of Trade is going to devolve upon the local authorities. That is extraordinarily important. At the present moment the whole of the powers of the Board of Trade could be devolved upon any local authority. I should like, as an alternative, to see the local authorities, where local committees are established, given powers to fix generally local retail prices, as well as to deal with specific cases as they come up. Then I want, also, to know what is to be the constitution of these local committees? That ought to be clearly stated in the Bill. For instance, I want to know whether women are to be given representation on these local committees? Is it not possible instead of setting up some wholly new tribunal to take the local Food Committees, which are already acquainted with the work, and have done excellent work in the past, and to expand those Food Committees so as to make them competent to deal with the other articles which are to be brought within the purview of the committees?

Finally, there is one point which has not yet been touched on. The President of the Board of Trade is going to take powers to prevent frivolous complaint. The one thing the trader is afraid of, and that, he wishes to be safeguarded against, is the making of frivolous complaints. I do not believe he wants to be safeguarded against reasonable inquiry. I should like to have set out in the Bill what are the provisions by which the Government propose to stop frivolous complaints being brought, instead of leaving the whole thing to be dealt with by Regulations at a later date. In all these cases the Government must know what their own intentions are. It is due to the House and the trading community that these provisions should be put into the Bill. Some sneers have been made upon what is a most valuable provision in the Bill—the power during the six months for local authorities, if necessary, to engage in buying and selling. We have already had an experience of it, and it has proved a very effective way of bringing prices down. I am not in the least afraid of the suggestion that it would mean embarking on municipal trading on an enormous scale. This is a six-months' Bill. I hope, incidentally, that one provision, upon which the Food Controller laid great stress when he was giving evidence before the Select Committee, is going to be carried out, and that is that where the local authority does engage in buying and selling, its activities will be completely self-supporting, and that no part will be a charge upon the rates. I think that is an essential point, because if subsidies are to be given on the price of commodities it is necessary that those subsidies should be as few as possible and should be charged directly upon the Exchequer and answered for in this House, and that we should not let the local authorities have a wide discretion in this respect.

For all those reasons I think that, having arrived at the position in which we are, it is incumbent upon any Member of this House who feels that profiteering must be dealt with, both in the retail and other stages, to vote in favour of this Bill and to direct his attention to making it a better Bill in Committee, so that the Government may be armed with the best powers. I feel that anyone who speaks in support of this Bill ought not to do so without expressing the warning that this Bill is not going to reduce prices all round. I think we should be very careful to avoid any suggestion that the Bill is going to do more than it actually will do. There is, I believe, profiteering at several stages in many articles, and I believe that an improvement can be obtained. But there arc many other things which go to govern the cost of price to-day. There is the whole question of exchange. The American exchange for instance, cannot fall 30 or 40 cents without adding a corresponding difference on to every pound of bacon we buy in the United States, and so with many things. It is just as well that the public should know that, and, above all, that the thing which is adding most to the cost of living at the present time is simply that we are producing less, and, consequently, are producing at a far higher price. Although I am in favour of passing a Bill of this kind, it is the duty of everybody to make it clear, in season and out of season, in the country, that the only sovereign remedy which can reduce the cost of living in this country is that the rich people should be a, great deal less extravagant in much of their expenditure, and that every class of the community should work a great deal harder than they are doing at present.


I have noticed with a great deal of pleasure, and, I must confess, with some degree of comfort, the indulgence which the House extends to anyone who addresses it for the first time, and I ask for that indulgence. There seems to be a general consensus of opinion that there is profiteering at the present time, even if we are unable to define it in any closer language than that used by the President of the Board of Trade, or to say exactly what we mean by profiteering. I think one has only to look around and to judge from one's own experience, and whether it is a question of the prosperity of those who deal in wines or spirits, or whether it is a question as illustrated by my hon. Friend of various other commodities with which we are familiar, there is agreement that profiteer- ing is going on. The extent of that profiteering has yet to be defined, and I hope that the hon. Gentleman who spoke from the Front Bench opposite, or any other member of the Select Committee, will not allow any sense of pique or any feeling whatever other than the most patriotic feeling, to induce him in any way to slacken his efforts on that particular Committee. I for one, as an individual member, feel that there must be work for that Committee corresponding with the work which must go on under the Bill.

It need not be a very large amount in profiteering to cause a great deal of unrest. At the present time, when the nation's nerves are on edge, and when we have been through a strain that we have not suffered for centuries, there is naturally a feeling of irritability all round, and the House is familiar with the very small thing which causes the greatest irritation. I do not care whether it is the price of a reel of cotton, which affects every working man's house in the country, or whether it is the even more horrible instance which was brought to the notice of the House, by way of question and answer only a little time ago, namely, that of the sale of one inch of ribbon to a discharged soldier, a man who fought in the War, at the price of a shilling, whatever it is, it is capable of causing the greatest unrest. I think it is well to recognise that what we described as profiteering does not in some cases arise from an immoral desire to grab a larger portion of this world's goods than one is entitled to. I think behind it all, in some cases, at any rate, you have the feeling that it is necessary to make as large a profit as possible against certain dark eventualities which people who keep shops see somewhere in the background. They are not clear what the future has in store for them, and there is this tendency to provide against an unknown future in the form of an insurance. It is very bad. It is bad from the national point of view because it only goes to help to create a very vicious circle. You have prices going up, and thereby the necessity for an increase in wages, and you have the circle going round until we reach a place where we find that it is absolutely impossible to continue.

I, therefore, welcome this Bill very much, and personally I should have given it higher priority than the Government have seen fit to do. In any case, one wel- comes the Bill, even at the present stage, because it does deal with something which it is necessary to deal with in the process of reconstruction. The President of the Board of Trade described it as a rough-and-ready method, and it certainly is. I think the criticism will also be levelled against it that it sets an example of legislation by reference, as certain powers are given to the Board of Trade to make regulations. I personally at this stage of our proceedings am quite prepared to accept in this case that form of legislation. I see nothing else that can be done. With the congestion of business in the House it is impossible to contemplate the House sitting down to consider a Bill which might contain seventy or eighty or ninety Clauses, which you would require if you were going to deal with every detail of profiteering legislation. I believe that the mere passing of the Bill will do a good deal. T disagree with some of my pessimistic friends who think that it will not have that effect. I can hardly understand why my hon. Friend the Member for Hornsey (Mr. Kennedy Jones) takes that point of view. It must be within the knowledge of the House that as soon as my hon. Friend got into the chair of the Committee set up to deal with transport facilities in London, the transport improved at once, and buses were more numerous. I see no reason whatever why the passing of this Bill would not to a very large measure place some restriction on the indiscriminate profiteering, and the thoughtless profiteering in some cases, which is going on at present. The details will have to be hammered out in Committee. The two main principles, those which give the Board of Trade permission to establish municipal markets and to set up tribunals, and certainly that as to the establishment of the markets, will, I believe, meet with very gratifying response from the country generally, because my experience, speaking for my own constituents, is that if there is one thing they are convinced of, it is that municipal markets are the practical remedy for profiteering at present. I should like to refer to Clause (1, a), which gives power to the Board of Trade to investigate prices and costs, and for that purpose to requisition any persons, papers, and so forth. It is quite obvious by this wording that the Government have at-tempted to utilise the system of costs investigation which saved the country during the War so many hundreds of millions of money. But I would point out that it would be impossible for the Government to expect quite the same result from that system unless they are prepared to adapt it to present-day conditions. We must not forget that during war time the Government controlled the supply of material and labour also to a very large extent. That does not apply to anything like the same degree at the present time. Cost investigation is an ideal remedy when you have the supply within your own hands. It is a practical proposition when the State is to all intents and purposes the great consumer, and the supply of labour and material is within its own control. But when the raw material passes through many hands right up to the finished article, and is absolutely free, then it is not quite as simple in its application. Again, if we attempt in any way to stereotype the cost of production we are going to have rather serious difficulty. The effect of stereotyping any particular article of production is that you remove any incentive. You remove the incentive to produce either a somewhat better article or a cheaper article, and undoubtedly, with a costing system, what will happen will be that the manufacturer will produce the most expensive article he can possibly provide, because that, from his point of view, will be the best. In the present-day conditions of business in this country we have got to do with something which in many instances is second best.

I therefore hope that the House will regard this Bill in the light of gaining experience. It has been pointed out that this Bill only runs for six months. I am glad of it. I think that should help to a very large extent those Members who for various reasons are a little timid about the Bill in making up their minds to support it and give it a chance. When we speak in this House of profiteering I think we have something more in our minds than the punishment of those who make unreasonable profits, and that what we really mean when we say we want to do away with profiteering is rather this: We want to obtain a permanent reduction of prices. We require that quite as much as we require the punishment of offenders. This can only be done by, in the first place, an increase in production, and, in the second place, a revival of competition and also the reduction of cost. As far as I can see—and this is my main criticism of the Bill—this is not met very well in the Bill. I would respectfully ask the President whether he has considered the possibility of dealing with this matter in such a way that the remedy would at the same time stimulate production and reduce cost. I put it to him that it might be possible to make an Order which would be applicable to various items which he may find it necessary to deal with. That Order should limit the rate of profit on the particular article per ton or per thousand or per dozen, as the case may be, to that which obtained during the pre-war period, plus a percentage which would have to be put on to make up the difference in the purchasing power of the sovereign and the additional cost of labour.

In that way there would be an incentive to increase the quantity of the goods, because then it is only by increasing the quantity that the trader could make more profit. You would, therefore, have the point I ventured to put in regard to the increase of production. Then it would tend to decrease the cost of production, because you would have competition coming in, and the manufacturer would have the tendency to decrease the cost wherever he could in order that he might compete with the lower prices, because he must secure a larger turnover. A further advantage of this Order is that it could be made at once. There are one or two matters which would have to be dealt with. Of course, it would be impossible to deal with articles that were not made before the War, and I am happy to say that there are a number now being made in this country that were not made before the War, and the method I have suggested would not apply to them, but it should be possible, either by reason of the class in which the articles are, or by some other method which, I am sure, could be thought out, to fix them in that particular way. With the greatest respect, I offer that suggestion, which may be worthy of the examination of my right hon. Friend, and I thank the House for their indulgence.


Several hon. Members who have addressed the House seem to be under some misconception in regard to the provisions of this Bill, and the Undersecretary on the Front Bench seemed to stray, I think, in the same direction. He referred to the meat trusts and the milk combines, and so forth, but, as I understand the Bill, it does not apply to controlled articles. I think that point should be made very clear, because otherwise we are apt to speak outside the Bill. The last paragraph of Clause 1 says that the Act does not apply to any article which is from time to time declared to be a controlled article. That being so, and knowing from the evidence of the Minister of Food before the Committee last week that some 80 per cent. or 85 per cent. of the food is controlled, and having regard to his own statement that there is no profiteering or high prices in food—I do not quite accept that myself, but it is the statement of the Government mouthpiece—I cannot understand some of the criticisms and the agitation that has been made about the high price of food. But I propose to confine myself closely to what is really in the Bill. An hon. Member just now spoke of the Bill as if it controlled prices stage by stage, in the process of manufacture, but as I understand the Bill it does nothing of the kind. The offence under the Bill, and the kernel of the Bill, is that you must not make an unreasonable profit; but, speaking as a manufacturer. I know this, that this Bill will permit per-sons to sell at an unreasonable price, although probably they may not make an unreasonable profit. The difference in the method of manufacture, the difference in the process of costing and how the cost is made up, the difference in the administration or the efficiency, the difference in the capital at the disposal of the firm, the question of the turnover of the firm, or the question of getting every ounce out of their factory and every inch of floor-space producing what it ought to produce, consistent with the Factory Acts, all these things have to be considered in arriving at what is a just and reasonable profit—not, be it noted, a just and reasonable price—and the effect of this Bill will be that if firms who are to-day producing at the very lowest cost are compelled to sell at the very lowest price, you would have to shut up everybody else who could not produce at the same price. That is the logical conclusion. If you had all trusts they could all be regulated quite easily, but when you have twenty or thirty or forty manufacturers in a given trade and the different manufacturers arriving at their costs by different processes, it must necessarily follow that you have a different price and that a firm must make a different profit, and it is because people make different profits that one firm fails and another profits—that one firm pays excess war profits and that another pays a modest profit.

Practically, what this Bill does is to penalise the firms who, by high concentration and efficient administration, have produced goods at the minimum price, and to exemplify what I mean I will refer to the evidence given by the Minister of Food before the Commission last week. He referred to an efficient bakery turning a sack of flour into loaves, and he said that one efficient firm could do it for 10s., and that another firm would require 30s. or 35s., and he struck the mean figure of 23s. Either he did a great injustice to the firm who said they wanted 35s. to convert a sack of flour into bread or he passed an unreasonable profit to the firm who could produce it for 10s. Apply the same argument to any other trade. The effect would be to penalise the firm doing the greatest service to the community, either directly or indirectly, because if some firms did not make big profits I do not think the Chancellor of the Exchequer would get the money he requires. He spoke last week with great gravity about the financial situation, but it is the firms who make at the lowest cost who are able to do the export trade and to compete with the foreigner, but if you are going to continue a policy of submitting the business of every trader, wholesale or retail, to a local committee, whether it be in Birmingham, in Manchester, or in London, how is it possible for such a committee, who cannot be experts in all things, to adjust where a man goes over the border-line between a reasonable and an unreasonable profit? Suppose a trader is asked to bring forward his trading account for last year, in order to prove his gross and his net profit, because we must bear in mind the difference between gross and net profit and how that profit is dissipated and what is in the gross profit. The gross profit is influenced and affected by the turnover, and the greater the turnover down will go the percentage of net profit. I can speak of firms who turnover their capital once a week, and of others who turn over their capital once a year. Who is to adjust what is to be the profit, gross or net, which a man in a quick ready-money trade turns over every week—£1,000 on hardly any capital, because he has a week's credit—and of a firm which carries £50,000 worth of stock and turns over the stock once a year or once in two years, because it does a big credit trade? It is a very fine thing for a lot of inexperienced people to adjust profits to a nicety and to penalise a man if they do not see eye to eye with a trader, because he is charging what they think is just over the border-line of a just profit. Take a mans trading account for last year. Assuming for the moment that he was dealing with raw materials he had bought the year before at an easy price, he probably made last year a rather big profit and, of course, paid excess war profits on it. If a tribunal under this Act is set up and he brings forward his trading account to show what his gross and net profits were for last year, that would be no guide as to what it will be this year. The conditions are entirely changed, as the raw materials are entirely changed.

I am speaking as a manufacturer who knows something about it. I have in my hand four quotations from four firms for a particular article used in every home in the country. I manufacture the same article myself, but, having more orders than I could complete, I thought I might factor a good quantity if I could buy the mat a right price. The difference between the lowest and the highest price quoted me—and there are two between—is 100 per cent. I have no doubt the firm who quoted the highest price would, if he came before a tribunal under this Act, say he had worked out his cost sheet, and show that he was only getting a reasonable profit. This firm has been asked to reconsider its price, and has returned the answer that it cannot do so. This is a film which has been engaged for four years on aeroplane work, and I presume, as a manufacturer, his cost sheets were got out in the same way as he did them for aeroplane work—that is to say, in a way which the Government considered reasonable—and when he gets out a cost sheet for an article which I want, it is 100 per cent. more than I can make it for myself, or than somebody else has offered to make it for me. The fact is that the firm who quoted the lowest price could raise his price 50 per cent. and still be selling lower than the highest price. He would be charged with making unreasonable profit, but the firm who charged the highest price would go scot-free, because they would probably show their cost sheets. The point is as to how the cost sheets are made up. It is just as easy to water your establishment expenses as it has been in the past to water the capital of a company. You may have directors who are buyers, with heavy travelling expenses, or draughtsmen with heavy incidental expenses, and you can make up your charges in a way which would satisfy—and which has satisfied—the Ministry of Air and the Ministry of Munitions, and which would satisfy a tribunal under this Act. If hon. Members bear these facts in mind, they must see that this Bill must fail to secure what it sets out to do. The Minister of Food, speaking on behalf of the Government, last week, said, in most unmistakable language, that it could not be properly done without an enormous administrative staff, and that then there was a danger of doing more harm than good. If the Ministry of Food have not been able, with the expert assistance that they have, to bring down food to a reasonable price, how is a tribunal to succeed which has not got the same expert advice? If it has been thought desirable to control food and leave it out of this Bill on the assumption that control is a good thing for the people, why not endeavour to control a few more things in which this profiteering is presumed to go on? Why not extend your controlling, if in the imagination of the Government controlling is good; and if controlling is not good, then the sooner you do away with it the better?

8.0 P.M.

I am of opinion that controlling is good, and that it could be extended far more than it is. I think the prices of food are to-day too high, and for this reason: A firm who has a number of registered customers knows exactly what his sales will be day by day, and what his requirements will be, and if he is a wise buyer he has no waste, and it is the waste in every business that cuts into the profit. Therefore, under a controlled system, a firm who can regulate its buying and selling to a nicety, whether it be a butcher, a fishmonger, a greengrocer, or anything else, will make the largest amount of profit, having regard to the fact that he has no waste. Taking this into consideration, I am of opinion, as one who comes into contact daily with traders, and who am a multiple shopkeeper myself, that they are making better profits to-day—whether they are butchers, fishmongers, or greengrocers—than ever they made before If control is effective, by all means extend your control, and fix the prices of things where they can be fixed. But this Bill only deals with the things in common use by the majority of the community. I suppose profiteering can go on to an unlimited extent in articles which are not used by the majority of the population. This Bill speaks of one of a class of articles. We can imagine a committee sitting round and discussing what is one of a class. A chair is one of a class, but there were six Chippendale chairs sold the other day for over £l,000. Are they one of a class used by the majority of the community? If so, what would be a reasonable profit on this kind of thing?


Read on, and you will see that it is "one of a kind."


A chair is one of a kind used by the majority of the people, but these six Chippendale chairs—and the same argument would apply to a multitude of other things of an exclusive type—are one of a kind or one of a class. Who is to judge what is to be a reasonable price for these? Assuming the trader bought a thing of this sort under its value, is he to sell it at a profit of 5 per cent., or at a price a buyer is delighted to buy it at? How are you going to arrive at what is a reasonable profit for that trader? His profit must vary from time to time. And then there is the question of the enormous amount of furniture and machinery hired out under lease or agreement. Last week we dealt with machinery in the boot trade under a lease. Whether it is machines, motor cars, or furniture, or the hundred and one things hired, there is a much higher profit made out of these things than out of cash trade. It may be that in some cases an unreasonable profit is being made. Who is to judge what profit a man is to have for a one year, two years' or three years hiring? And why is profiteering to go on in goods not used by the majority of people? The plant and machinery which go to make up goods which the whole community desire will affect directly and indirectly the cost of production, but if I buy a lorry, or motor car I can be robbed day and night, so far as I understand the Bill, and no attempt will be made to deal with that. Is that going to help our export and import trade? The things which are not used by the majority of people will be the very things which will enable the foreigner to creep in. The President of the Board of Trade said that one of the chief reasons for this Bill was to allay discontent. Do you not think the traders of this country are just as much discontented when they know, lightly or wrongly, that a ship owner can sell a ship which cost him £14,000 for £140,000, whereas the man who bought timber two years ago and puts it into goods to-day, and who pays Excess Profits Tax, can be fined for getting an unreasonable profit.

I have endeavoured to point out weaknesses of this Bill of a concrete character, but I do submit that this Bill will cause friction, will harass traders, and will not benefit the consumer, and I do suggest to the President of the Board of Trade that, in view of the serious situation, as foreshadowed by the Chancellor of the Exchequer last week, his great abilities and his Department would be better employed in devoting every moment of their time to seeing how and where they could promote production and the increase of wealth in this country, by dealing with the question of millions instead of the question of pounds. It has already been said in this Debate, and hinted at by the President of the Board of Trade, that there is not the amount of profiteering that has been imagined, and that it is a good thing to show the people there is not this large amount of profiteering. I have never heard an argument like that to justify the bringing in of a Bill which is to persuade the people that there is no profiteering, and under which decisions are to be arrived at by a Committee who are not experienced, and are unable to form an accurate judgment, and when you have found out that there is no profiteering, the public will be satisfied, and that justifies the Bill. Is that the spirit in which Governments are to govern, and to be stampeded into legislation because of a Press campaign which is largely devoted to the object of damaging the Government, devoting its energies one week to abusing the trader, and next week to abusing the Government? We have not heard in this House to-day any strong evidence of profiteering, although the President of the Board of Trade has at his command a huge machine. We ought to have had brought to this House concrete evidence. Surely it can be found, if it is so rampant, before this Bill is introduced. Then, again, the Bill involves investigation, and before the investigation is complete the six months will have elapsed, and the Bill will have become out of date.

There is just one other question with which I want to deal. As I understand this Bill, it does not deal with food or controlled articles. Then, can the municipalities deal in food and controlled articles? I would like the right hon. Gentleman to answer this question, because it seems to me, if the Bill excludes controlled articles, it follows that power is given to municipalities to deal in other than controlled articles, and, that being so, is It suggested that municipalities should set up trading in household requisites other than food? Just imagine municipalities setting up trading in the multitude of things sold in the course of trade! They will have to engage buyers and staffs and all the paraphernalia associated with trade, and at the end of six months they will have a huge quantity of stuff on their hands. Is it a practical proposition? You are suggesting in the Bill something which really cannot be done in six months, and, if you could do it, what guarantee have we of control? Take national kitchens. Has anybody ever seen the balance-sheets and returns of the national kitchens, and what they have lost? I have seen a few, and they have made big losses. I am not complaining, but surely we are not going to continue the policy, now the War is over, of subsidising trading in this way? Reference has been made to Ilford and Barking and the street markets. It is another indirect form of subsidising trade. The costermonger pays no rates or other charges, and never pays Income Tax—at least, I have never heard of a coster paying Income Tax. He is much too clever to cover up his income. But the ordinary trader has not only to pay rates to keep the streets clean and so forth, but to pay taxes. Is it the intention of the Government, which cannot get enough revenue now, to set up a system of trading which will further reduce the profits of the bond fide trader and reduce his income, and thereby reduce revenue?

That is called a far-seeing policy dealing with profiteering. As a matter of fact, the Government have been paying big wages in munitions and other Government employment far in excess of the ordinary market wage, but they have been getting it back in the form of taxes on beer, tobacco, and other things. Now they are going to set up a system of subsidising everything and everybody. We have already subsidies approximating £200,000,000 a year, and now we are to have added another kind of subsidy of trading which is going to cut into the ordinary trader who has got to help to pay the subsidy. To my mind, it is a very illogical proceeding, and, speaking as a trader, and one associated with the shop-keeping class, who has sat on a tribunal and a food committee, I know these committees are utterly incapable of dealing with these questions at all. I know how they are constituted. It is invariably the practice of the mayor and corporation to select the committee or the majority of the committee, and the complexion of the committee is biassed more or less by those who select the committee. That is how it has been done in the past, and I presume will be done in the future. The result will be that in one part of the country you will have a majority of co-operators, in another part a majority of unionists, and in another part a majority of railwaymen. There will be no equality or unanimity in the whole proceedings, and we have no guarantee throughout the length and breadth of the land that there will be any uniformity of decision or of justice meted out to the people.


To vote for the Bill, in my opinion, is to sink one's self-respect as an economist; to vote against it is to deprive the Government of an opportunity of showing the country that you cannot break the law of supply and demand. As a matter of fact, you can break no economic laws, in my humble opinion. If you try to break them, they will break you. I think many of the arguments Ricardo put forward on the theory of rent will very well apply in this Debate. But I am going to vote for this Bill, not because I like it, not because I think it good, but because I think it may dispel the fears of the people that they are being swindled and are without protection, and will give an opportunity to the Government of looking into the working of certain trades, although when I hear the Meat Trust referred to, I do not know how in the world you are going to control the profiteering—if you call it so—of the American Meat Trust.


It is not in the Bill.


I heard someone in the Debate refer to the Meat Trust. But, as I say, the Bill will give an opportunity to the Government to look into certain things, and it may be that some things may be put right. But the whole Bill is based on an economic fallacy, and I will try to explain why I think it is so. Further, there is one part of the Bill which I do not like at all, and I wish it were a separate Clause which I could vote against. It is this: Living as I have most of my life in a great provincial city, I am quite well aware that ill-disposed people are only too glad to use a weapon to spite their neighbour. I should be very sorry to see this Bill used as a sort of inquisition or as a means to steal a march on a neighbour if provisions are not inserted to prevent malicious prosecutions or vexatious actions. I cannot understand why the President of the Board of Trade said that this Bill should apply to the home markets. He said twice that this measure should apply to the home markets. If the Board of Trade, through its Bill, was going to cut down the price, let us say, of any article that we might be able to export to America, the first thing that the manufacturer or the shopkeeper or the factor would do would be to say, "To Jericho with your controlled price in the home market; I am going to send this article abroad." That may be. How would the right hon. Gentleman like to see boots, shoes, and clothing go abroad. It would be a good tiling to send them to America. You would not suppress the export of these things which are made in England from going forth to America. It would help our exchange, we know. On the other hand, it would reduce the supply of things which are necessaries here—boots, shoes, clothes. But these are, let us imagine, very much wanted in America, and certainly in Canada at present. It would, however, reduce the supply to our own people, and it would defeat the very thing that you are setting forth to remedy—you would increase the scarcity in the home market.

The remedy is in our own hands. Supply and demand are at the bottom of the whole of this "profiteering." There is a shortage of supply; and excess of demand. I do not know what profiteering is. Does it mean excessive profits? Does it mean excessive prices? Or excessive cost? My doctor charged me three guineas recently for a consultation, instead of a couple of guineas. Is that profiteering? I do not say so. I want a better definition of profiteering; for my doctor tells me that he is bound to charge me more because at the present prices he cannot live. Coals cost him more; so do clothes; so does food! Who are the profiteers? Who are the people that have put all these things up against my doctor? Is it not the Labour people themselves? I do not be grude them their wages. But you cannot have it both ways. If you put up the price of labour, and coal, and various other things that go to the manufacture of the necessaries of life, transport, and what not, then all these things that come into the hands of the working and other classes go up, more wages have to be given, and so the whole vicious circle goes on. If wages are put up two and a half or three times above what they were at any given period, and the cost of living only goes up to twice as much as it was compared with the same period, you will at once bring about what is called an excessive demand for goods, and, with a shortage of supplies, as was seen in time of war, and on account of the manufacturing of war material absorbing all the material and on account of the output being for war purposes, you will probably have what is now called profiteering. I do not think I have referred to the following point, but I think that a good deal of the extra cost of goods from which we are now suffering has been brought about by the Excess Profits Duty. No doubt it causes a very wasteful result in the production of goods. Every man who can claps a little extra on from the raw material on its way to the manufacturer, then the manufacturer, the distributor, all who handle the article from the time it leaves the earth as raw material to the time it reaches the consumer. Every man, in order to make that with which to pay his Excess Profits Tax, high Income Tax, and so on, claps on a little, and so the price is made higher.

I was very much interested in what the Chancellor of the Exchequer said the other day about the currency notes. He stated that there had been a large increase in the amount of currency notes issued. I harness that up with profiteering or high prices. What does it mean? It mean this. That we borrowed at least 1,000 millions from abroad, and also we borrowed millions from those at home. Certainly from abroad 1,000 millions came in. It was paid in wages, salaries, gratuities, dividends. This money is now being spent like water. The people who have received these increases are spending it in every form of extravagance. At no time were there so many pleasure motor cars, so much champagne drunk, or at so high a price, so much feasting or such high-priced clothing bought, and this money is going round at a greater celerity than before. This absorbs a large amount of labour for unneessaries. It incites manufacturers to make these things, and so diverts raw material and labour from necessaries which would increase the supply of these necessaries in this country, and so give the poor and the middle classes an opportunity of buying them, and its cessation would increase the ability of these very manufacturers to export these goods abroad and receive in exchange food and other things of which we require here a greater supply to keep down the cost of living. Some of these observations refer to the class to which Members of this House mainly belong, and I think our private extravagance is a matter of which we ought to be ashamed. This has a great deal to do with the high cost of living in this country, by diverting, as I have said, the manufacturer from making necessaries, and so allowing him to export a surplus, which in turn would bring as payments the imports, articles of food, and so on. As I have just pointed out, this process would keep down the cost of living in this country. This Bill deals with the symptoms, and not with the cause. What is the cause?


Restriction of imports !


There is no restriction applicable to the present argument. My hon. and gallant Friend speaks about the restriction of imports. He seems to regard this question of the restriction of imports very much as Mr. Dick did King Charles' head. It has nothing to do with the cause. Let me finish what I was going to say. I was about to say that the whole position hinges upon this problem of supply and demand. If there are ten people who each wish to buy one item of which there are only six, the consequence is that the price goes up to these ten people. If you turn the matter round and say: There are ten people who wish to buy articles of which there are sixteen, then those ten persons will have it pretty much their own way, because they will dictate the price to the sellers. Therefore, I say it does not matter what you do with regard to controlling the price, the position remains the same—the supply is too little and the demand too great. The hon. Gentleman sitting below me (Colonel Wedgwood) a few moments ago remarked about the restriction of imports. I do not know whether I would be within the Rules of the House in saying so, but I happen to be a member of the Committee which the President of the Board of Trade asked some Members of this House to join. I was chairman of one of the Sub-committees dealing with light chemicals. When the Committee with which I was associated had an application before us, the one object uppermost in our minds, and the one single object in view, was our anxiety to keep our workers in employment. We kept that first in mind, and we said, "If these goods can be produced in this country we shall keep the restrictions on so as to allow these men who are employed by these manufacturers to do work and earn wages. That was our reason, and our only reason. Suppose you remove those restrictions is that going to bring down the price of the goods? I do not think so, and for this reason. There is no restriction on the importation of food, and removal does not bring down the price of food.


There is restriction of importation!


I do not think so. I think that the Government would welcome cheap food coming in from anywhere. There is no restriction that I know of in respect to the main necessaries of life. Supposing you take all restrictions off the import of silk goods, cotton hosiery, or cotton gloves—say on silk. You will, to my certain knowledge, inflict an injury in one place, where there will be at least 1,000 men and women thrown out of work. Hosiery and fabric gloves came into this country from Japan six or eight months ago at a price less than we had to pay for the raw material. If you had let in these articles from Japan thousands of men would have been out of work in Nottingham and that district, and that would soon settle high prices, and in a disastrous manner, because they would not have money to pay for food. I dislike the expression arbitrary restrictions, used by an hon. Member, because they are not arbitrary. I was one of forty who sat on some of those committees, and one of them represented the largest body of consumers in the country—that is the Co-operative Wholesale Society—and he amply protected the interests of the consumers. We tried to keep down prices very much in the same spirit as this Bill seeks to do, and everything we did was done by men who were conscious of the mischief that might be done if prices were kept up. I shall vote far this Bill, not because I like it but because I know that in many cases unreasonably high prices are being charged for food and certain necessaries of life to the poor. They have suffered, and they will continue to suffer so long as supplies of necessaries are short, and supplies of necessaries are being kept low because of the extravagance of all classes in this country who are causing unnecessaries to be produced.

All the trains are crammed with holiday makers, and all the resorts from the South Coast to Blackpool are crammed. Every theatre is crammed, and money is being squandered which should be saved by people and not spent in putting up prices against themselves. I want extravagant people to keep their money for a better use. In the name of everything that is reasonable let them keep out of the market, putting up prices one against the other, in face of shortage of supplies. If you bring down, say, the price of cabbages a man will have more money for cigars and so put up their price, and if you bring down the price of cigars he will have more money to spend on chairs and put up their prices, and so on. It is like a train of trucks on the railway. You allow the first one to bump and the motion is conveyed right to the other end to the last truck. This Bill is as rotten economically as it can be from the first letter of the opening paragraph to the last, though it may frighten wrongdoers. But I am going to vote for it so that it may let people see that, though you cannot break the economic laws of supply and demand, it is at least an honest attempt by the Government to put down profiteering.


We have been assured by the last speaker that we cannot break economic laws. I think it will be found if we refer to the text-books of the last fifty or sixty years that many of the theories of our economic teachers have been torn to shreds during the last few years. We are discussing a Bill, which has come as a measure of surprise, built on the belief that there is in this country a sufficient amount of common sense to deal with a very great evil. One thing might be the outcome of the Committee upstairs. Undoubtedly there is throughout the country a vast amount of dissatisfaction and unrest due to high prices or profiteering. The high prices are there, and I hope that the Committee upstairs will reveal how they have been created, how much has gone in the way of increased wages, and how much is due to factors over which we cannot exercise any control. I hope these facts will be made clear to the public as quickly as possible. Nobody will object to any in-crease going in the way of wages. In pre- war days if there was one thing in this country that was far too cheap it was labour, and most of us will be glad to see that while wages remain pretty high prices should be made to go down. I hope it will be made clear how much of the increased cost in the high price of commodities has gone in wages and that is not profiteering.

The hon. Member for Hornsey (Mr. Jones), in moving the rejection of this Bill, said it would cost the country a matter of £50,000 to administer it for six months, and that it would take six months before anything could be done to check the evil. There is one body in this country with a turnover of millions a year and supplying most of the common necessities—that is the Co-operative Wholesale Society—and they sent representatives who were prepared to give evidence before a Select Committee, and if we take the main things in life that we eat or wear in the manufacturing world this society manufactures very largely in all the essentials in life that administers to our needs and comforts. This body exists not as private exploiters but to serve the interests of their own members and their prices are much the same as others. In these matters I think the Board of Trade in this country may have some influence.

With regard to the local tribunals, I am satisfied that when they are set up you will have to do something to prevent a grocer sitting on a tribunal to decide a case in which complaints have been made against a grocer, but I think that when the affairs of a local tradesman come before a local tribunal in most cases the men in the same trade will not sit in judgment upon their fellow tradesmen, but the case will be left to members of other trades. We all remember the time when in this country, through the violation of economic laws, the price of rabbits was fixed at Is. 9d., with the result that the rabbits disappeared and they would not come out of their holes at less than 3s. 6d. I hope powers will be extended to local tribunals to deal with the men who withhold commodities from the market. I know the local tribunals could not undertake to do that, but I think it might be done by a proper tribunal. In the matter of greengroceries there are certain areas where the market gardens may be either in the same county or in an adjoining county, and the local tribunals might come together to see that these people do not withhold their supplies from the market, and they might see that reasonable prices are fixed, and that the available supplies should be forthcoming. We have a number of people in this country who have a strong liking for beer. This one item alone affords a means by which the local tribunals can do a great service to the community. I believe millions of pounds have gone to brewers and beer sellers in the last two or three years which was not justly theirs. One might begin with half a pint of beer, and when the retailer fixes his profit it is based upon the cost of a half a pint of beer, he commonly serves in glasses containing three-fifths of half a pint, and consequently the brewers and retailers are making three barrels of beer go as far as five barrels ought to go. I suggest that if powers are given to local tribunals to lay down regulations a good deal that has been done in this direction could be entirely changed. We have read in the papers of the extortionate charges made at hotels and refreshment places, and even for cards at race meetings. There has grown up in this country a vicious practice which is due in some degree to the alien element. In the old days a customer could send in his or her order with the local carrier and could depend upon receiving the goods and upon being charged a fair price, but in, the tailoring and furniture trades especially we have had introduced an alien element, which has almost secured control, and I am afraid that in some cases they have not the same sense of fair play as the British trader. When these local tribunals are set up with power to check extortion on the part of the ordinary trader, they might go further and say that certain persons who have come here and who cannot carry on their trade honestly should go back to where they came from, and so give honest people a chance. Although the Bill has been somewhat harshly criticised, very few constructive ideas have been put forward by the other side. Something needs to be done. I am perfectly certain that the evil of profiteering has been exaggerated. The high prices are there. We cannot get them down, but we can remove public distrust by the powers given by this Bill. Even on a smaller point, if it checks a man who wants to rob his fellow man and restores honesty, it will be worth its place on the Statute Book.


The hon. Member for Farnham (Mr. A. M. Samuel) seemed to assume that the cost of living always followed wages. In fact, it is the opposite that happens. Every demand for increased wages made since the War has been based on the existing cost of living. Our complaint before the War was that the cost of living had gone up and that we sought an increase in wages. I saw a cartoon in a Cardiff paper—I believe it was the "Western Mail"—a week or two ago which hit off the situation. There were two men riding hobby-horses, one called "Cost of living" and the other "Wages." The one called "Wages" was behind and said. "I am darned if I can catch up, whatever I do !" That is the position.


It was stated before the Coal Commission that wages had gone up in larger ratio than the price of food. That was the point on which I built my argument.


The demand was made on the then existing cost of living. I find myself in queer company this evening. I am opposing this Bill, but I disagree as much with the Mover and Seconder of the Amendment as I do with the Bill itself. The Mover of the Amendment seemed to think that everything was all right and that the Government and no one need take any notice of profiteering, because there was none existing. The Seconder said that the only thing to be done was to remove the control at present existing, restore freedom of competition, and that would answer the purpose. That has not been proved in practice. Whenever any article has been decontrolled, on the morrow the price has gone up. I do not know whether hon. Members have had the same experience as myself. I have received letters from every food committee in my Constituency asking that certain articles should be controlled again. Only three weeks ago a deputation came from practically the whole of the food committees in Monmouthshire. They met the Food Controller and asked him to re-impose the controlled prices. The chief speaker was the manager of a very large co-operative society, and he gave figures proving that as soon as control was taken off the price of bacon and other articles immediately went up at an alarming rate. Therefore I do not agree at all with the hon. Member who says that we ought to take control off. We really want to put it on again. The Government cannot help themselves in this matter. The questions of profiteering and the cost of living must be attacked. I believe that profiteering is rampant in the country, but I do not believe that the retailer is the biggest sinner or the man who should be attacked first. What has happened during the last four or five years? The cost of living has gone up until the men have made a demand for higher wages. Those higher wages have been conceded. Yet still the cost of living went up, and again a demand was made for higher wages. There comes a time—I am not sure that we have not already reached it—when we cannot go any further. It is a vicious circle. That vicious circle must be broken if we are to exist as a nation. It was a common saying among the men when wages were going up, "The wages arc no good to us because we simply have to hand them over to other people." Deputations from certain organised trades have met representatives of the Government more than once asking them to pay attention to the side of the question we are dealing with to-day. The demand for higher wages would have dropped out altogether but for the fact that the Government have delayed so long in attacking the question. I am very glad they are paying some attention to it, although I do not believe they are doing so in the best method.

Why was this Bill brought in at all? The right hon. Gentleman who introduced it to-day stated that the Government have been considering it for six months or more. If they were doing so, it is a strange thing that about three weeks ago they should have appointed a Committee to inquire into the matter. I should like to say a word about that Committee. I believe that it—I am not a member of it—had the confidence of the country. When it was first suggested, and the names were announced, there was no adverse newspaper comment. Compare that with what we have seen since last Tuesday, when the right hon. Gentleman went to the Committee and said he was going to bring in a Bill. There were comments in every newspaper published in the country, very many of them unfavourable to this Bill. Trades people, Labour leaders, and other men in different spheres of life have been interviewed, and the interviews have been published in the Press. Almost without exception they are opposed to this Bill. They say it will not have the effect it is intended to have. I believe that if that Committee had been allowed to go on with its work it would have been much more effective than this Bill can be which proposes to set up local tribunals. What will those local tribunals deal with? They will deal with the local trader, with the retailer. But suppose the retailer proves that his profit is not unreasonable? That is not proof that there is no profiteering in that particular article. Take a suit of clothes. We pay nearly three times as much for clothes as before the War. We might go to the tailor and charge him with profiteering, but he might be able to prove that he is not making any greater profit than he did before the War. That, I say, does not prove there is no profiteering, and that the prices are not very much higher than they ought to be. I believe that this Committee would have sifted the evidence and have gone to the very root of the trouble in regard to every article. But the local tribunal will not be able to do that. It will simply deal with the local people. What is necessary is to go to the source of everything, and if the Committee had been allowed to do that it could have brought in recommendations without all this trouble of setting up special tribunals, and it could have been left to the local benches of magistrates to deal with, profiteers.

I am not sure whether it was not a fear of some recommendation of that kind which caused the, Government to bring in this Bill and to dissolve the Committee which had been set up. We have had lately Committees dealing with certain matters whose findings have been far from pleasant reading. We have had one in the last day or two whose findings have been the contrary of pleasant. I think the Committee would have done much better work, it might have been a little longer about it, but then I do not believe that the retailers are the biggest sinners in. this matter. Certain comments have been made on Clause 3. No one need worry about that Clause. I do not believe the Government intend to give these powers to the municipalities. The whole argument of the right hon. Gentleman was against taking part in trade and against competing with private people. The history of the Government is against giving these powers to municipalities. They got rid of the ships they owned as soon as they could; they got rid of their shipyards as soon as they could, so that they should not enter into competition with private people, yet they have a Clause in this Bill which enables them to give power to the local authorities to trade. I believe they never intended to do anything of the sort. It is simply a bit of padding in the Bill, and hon. Members who have objected to that particular Clause need not concern them-selves about it. Had the Labour party been in power they might have had reason for doing so. Personally I would advocate something of the sort being done. But still I must admit I think the appointment of the Select Committee was the better plan. There seems to be no confidence in this Bill. You are dealing here simply with the people who take in the pence; you do not touch those who reap the thousands of pounds. That seems to be the weakness of this Bill.


As representative of a very large working-class constituency I feel bound to support the Government in regard to this Bill. I cannot understand how anybody who professes to represent Labour can go so far as to vote against this Bill. Even although we may all agree that it is not a thoroughly good Bill, it is at any rate a step in the right direction. I should be sorry for anybody who represents a Labour constituency who went down into that constituency and said he had voted against this step in the direction of checking profiteering. It may not be, and I do not believe it is, a complete chuck. There are features in the Bill I do not like and which i may endeavour to get rid of on the Committee stage, but at this point on the Motion for Second Reading I feel compelled to support the Bill, because in spite of all that has been said by the last speaker end by other hon. Members the first lines of the Bill lay down a principle which everybody who represents Labour is bound to support. What are the words of the first paragraph of the Bill? They are: Whereas it appears that the prices of articles are, to the detriment of the people, being enhanced in some cases by the charging of prices yielding an unreasonable profit. Do any hon. Members on the Labour Benches dispute that the prices of some articles are being enhanced to the detriment of the people by charging unreason-able prices? No. Well, here we get some common form of agreement with the Bill to start with. These words are in the right spirit. It is not a Bill merely, as some hon. Members appear to suggest, to deal with the retailer. There is not a word in the Bill which singles out the retailer, and even if it did, I should not be afraid of offending the retailers in my own Constituency, because I do not believe that they are profiteers. It is only the profiteers in a constituency who could be offended by this Bill, which, broadly, is directed against persons who are engaged in the production, handling or distribution of goods. These, of course, are, practically speaking, nearly the whole nation, and therefore this Bill merely lays down the principle that, whatever the class of men may be, and whatever business they may be engaged in, they are not to be allowed at this juncture to make unreasonable profits. Again, I say I cannot see how any hon. Member who professes to represent the masses of the people can take exception to that. There are other points in the Bill with which I do not agree, but they are minor points which can be dealt with on the Committee stage. It has been suggested more than once that this Bill is a panicky Bill, brought in a hurry. I do not agree. I think it is a belated Bill. An hon. Member near me dissents. Some of us were raising this question probably before he was thought of as a Parliamentary candidate. In 1917 I raised this question of profiteering and the power of the Government to deal with it on no fewer than five occasions, both by speech and by question, and I would like to draw the attention of the House to a question I put to the Parliamentary Secretary to the Ministry of Food on the 19th of December in that year, when I inquired of him whether the Government had sufficient power to enable it to deal with particular producers in this country who made undue profits, and, if so, why more food-producers had not been proceeded against? The Parliamentary Secretary of that day replied that the answer to the first part of my question was in the affirmative. He maintained, in fact, that the Government, two years ago, had sufficient power to enable them to deal with those who were profiteering, and he went on to say that the reason why more producers had not been prosecuted was due to the absence of any evidence that they had made unlawful profits. The Parliamentary Secretary to the Ministry of Food at that time was my right hon. Friend (Mr. Clynes) who spoke earlier in the Debate, and it does seem extraordinary that he should say what he said to-night, in view of the fact that he himself, nearly two years ago, claimed that the Government had sufficient power to deal with profiteering, and that the only reason why more prosecutions had not taken place was that there was an absence of evidence that people had made undue profits. That shows the difference between when he is in the Ministry and when he is in Opposition. It is still more curious that the right hon. Gentleman should oppose this Bill to-night, because he pointed out, in answer to my question, that the weak spot, so far as the Government was concerned, was the absence of any evidence that people had made unlawful profits. Yet when the Government bring in a Bill to set up machinery to collect the evidence to make it clear that people have made unlawful profits, the right hon. Gentleman opposes it.

Whatever defects this Bill may have, it has the virtue that it proposes to bring forward in open daylight the people who have complaints to make, to confront them with those, who are accused of being sinners, and that the person under suspicion shall be tried by his peers. That is the meaning of these tribunals. The tribunals will be collected, I presume, more or less from all classes, on a democratic basis, and the supposed offenders will probably be drawn from all sections of the community. Therefore, the people who are under suspicion will really be tried by their peers. If it proves that there is a primâ facie case, and that these people are guilty of making unreasonable profits, does anybody in this House want to defend them? I do not want to defend any man who has made unreasonable profits. If anyone is making unreasonable profits, and he can be found guilty of it, let him by all means be punished. In other cases, the person or class of traders may be found to be quite innocent, and the high prices which have been attributed to profiteering may be found to be really attributable to something else. I can quite well understand that a man in my Constituency or in any other may go into a shop to-day and ask the latest price, say, of bacon, and may find that it is 2d. or 6d. per lb. more than he was charged three months ago. He may say to the shopkeeper, "You must be profiteering." If the case is investigated, it may be found that the cause of the advancement has nothing to do with the retailer or the wholesaler, but is due to the fall in exchange between here and America. The Anglo-American exchange has fallen something like fifty points in the last few months. A few days ago it was suggested by a member of the Government that it may fall another thirty points, and that again may put prices up. If the apparent cases of profiteering are in fact due to circumstances such as rates of exchange, surely it is right and proper, and altogether to the good, that the people of this country should know it, because, once they understand that, they will be led, perhaps, to understand what hinges upon it, and they may be led to ask themselves and others, "Why is it that the exchange is falling between this country and America and other countries?" They may thus be brought to grasp the fact that exchanges fall because we are producing too little and exporting too little and importing too much. If we can get the people of this country to understand that, and can get them to abandon the idea that everything is due to the sins of their fellow countrymen, why, that is all to the good.

I therefore support this Bill because I believe it is bound to have a good moral effect. Those who may be hesitating as to whether they will or will not indulge in the vice of profiteering will think twice before they do so if this Bill is passed. If investigations are to be made and people are to be accused and proved guilty, and if the real causes of high prices are to be disclosed, it will have a great educational effect upon the country. Although I cannot say that I regard this Bill as perfect, or anything like it, I certainly think that it has its merits, and I intend to support it. I believe, in spite of the protests of some of my hon. Friends who claim to represent Labour, that they and I will be found voting to-night in support of this Bill on the Second Reading, because I cannot imagine how anybody who really has the interests of Labour at heart can vote against a Bill which will have some effect in checking profiteering and in reducing prices, and which will also have some effect in allaying the indignation which is felt in the country, and in assuring the populace that we in the House of Commons have their interests at heart.

9.0 P.M.

Lieut.-Colonel W. GUINNESS

We have listened to a very interesting speech on the need for some legislation to deal with profiteering, but I am sure my hon. Friend will forgive me if I say that he has not gone very closely into detail as to how these particular proposals are going to effect that aim. I am sure that the whole House wishes to stop profiteering, but we have heard very little this afternoon to satisfy us that the Bill will achieve that object. It appears to me to be a very bad case of a hasty and ill-considered measure being put before this House at the end of a Session simply as window-dressing. I feel that we have a right to ask for rather more details than have so far been vouchsafed to us as to how this Bill originated. Last Tuesday the Minister for Food appeared before the Select Committee on Profiteering, and gave some very interesting evidence. While he admitted the need to eliminate the speculator, he accepted the summary of his evidence that high prices of food were not due to excessive profits. He was asked for suggestions, and he made them. They were very good suggestions—much better than those which have been adopted in this Bill. The Minister for Food, however, dropped not the slightest hint of any such proposals as those which two days later were sprung upon an astonished Committee and introduced into this House. [An HON. MEMBER: "The following day!"] Surely it is very remarkable that on the Tuesday the Minister for Food had no idea about these proposals !

Apparently this Minister, who, from his experience, had a better right to be consulted and to give good advice than any other Minister, was never told anything about it. We were told this afternoon that the Board of Trade had long been considering this matter. If so, it is startling evidence of the present chaos in the Government, which is due to the suspension of the Cabinet system, that while the President of the Board of Trade has been carefully considering the matter and the Cabinet presumably have had it before them, no idea was in the mind of the Minister of Food last Tuesday that they were going to introduce such legislation. I object to the Bill in its present form, because I think it will be very disappointing to the country, and in its present state of mind such a disappointment is dangerous. Until you can alter the rules of arithmetic, until you can add up two and two to make three, you cannot get away from the fact that higher wages for the same output mean higher prices, and now we have got the additional difficulty that there is a reduced output and there is scarcity of many materials, and this forces those businesses which are dealing in the necessities of life to charge a higher price to enable the goods to be marketed at all. There is a strong possibility that we have not yet reached the final level to which prices will rise.

It is most desirable that we should restore confidence, but I want to see more drastic proposals than those contained in the Bill. If it is effective at all the Bill will prove to be a very terrible instrument of oppression. The position of the trader who will be liable, from motives of spite perhaps, to be pulled up before a body which perhaps has no great sympathy with his trade, and is perhaps even jealous of his position, will be most undesirable. Surely there should be some penalty in the Bill at least for vexatious complaints against traders. Then it is impossible to define what a reasonable profit is. We know that large profits in one line are often necessary to make up for small profits in another, and you cannot lay down a fixed return on capital because the competition of large businesses with a big turnover and resulting facilities for economical management and the avoidance of waste would, if they were limited to the same return on capital, absolutely knock out every small business. Think, too, of the effect on the magistrates of having to try these cases ! Unlike every other legal decision which they give, they will have to decide such cases without any code to guide them. I am informed by lawyers that those cases which were referred to this afternoon by the hon. Gentleman (Mr. McCurdy), the cases which come before the Court where it is necessary to prove that a man has acted in an unreasonable manner, are about the most difficult cases which they have to decide, although they have a long series of legal precedents to base themselves on. What will be the result of proceedings before these tribunals? You will have great popular feeling on the one hand, evoked by necessarily arbitrary and conflicting decisions in different parts of the country. On the other hand you will have very great bitterness aroused locally by some persons apparently guilty of profiteering getting off owing to the difficulty of drawing a proper charge under this Act.

Then I should like to protest against Clause 3 in its present form, which allows the widest municipal trading. Considering that this House only a few short weeks ago threw out a Bill for municipal trading introduced by the Labour party, I do not see what consistency is left to those who support this Claue. Under proper conditions no doubt a municipality in the present emergency should be entitled by its competition to keep down prices, but we must hedge those concessions very carefully; otherwise we may find that certain local authorities will be subsidising this trading out of the rates. Trading firms will find themselves highly rated to run a competition at a loss with their own businesses. Surely we ought to have a provision that this trading must be self-supporting and subject to frequent audit by the Board of Trade, so as to ensure that it is not subsidised in this way! This is necessary, apart from fairness to the trader, to restore public confidence, because think what will happen otherwise. You may find that in certain districts in the municipal shops, owing to a rate subvention, things will be sold much cheaper than in any shop run on commercial lines and at a price which is entirely uneconomic. This will only encourage an unjust suspicion against a lot of quite honest traders who have to make their businesses pay. It is quite possible that it would lead to popular outbreaks and that very looting which I take it this Bill is chiefly designed to provide against.

The criticism has been made that we are not justified in criticising this Bill unless we have some definite proposal to bring forward in its place. I think there is another and a better way. We must all recognise that there is a feeling in the country against profiteering. That feeling can be entirely obviated by control of prices until they have worked up to their final economic level. The President of the Board of Trade argued at some length against the suggestion, which I think no one had made, that flat prices should be imposed upon the country. Of course, flat prices would be simply disastrous. There is no necessity for them. If you provided maximum prices, all those objections which were urged by the President of the Board of Trade would fall to the ground. Such control of prices need involve no control of supplies and distribution except in those rare cases where there is a shortage of the commodity to be dealt in, and therefore we need not be appalled at the cost of this control. Probably it would mean no increase in the staff of the Ministry of Food. Probably their costings department would be transferred to the Board of Trade. Anyhow I take it if the Board of Trade fixed these prices the costing department of the Ministry of Food would be reduced to a very large extent. There will probably be no difficulty about supplying the necessary information of the cost of food without any delay. According to the evidence of the Ministry of Food, that Ministry is already quite capable of fixing prices and margins at all stages. It is a little ambiguous in this Bill how far food will be controlled, because although at the present time food is not controlled to anything like its maximum of 94 per cent., I understand that there is a considerable number of different food supplies which will shortly revert to control. I do not know whether this Bill is going to interfere with that or not. Anyhow, there is no difficulty about fixing maximum prices for a great many classes of food, even where no attempt is made to control distribution of supply. The machinery of food control, which they have worked up to a very high pitch of efficiency during the War, could easily be extended to all commodities. Probably owing to local variations it would be necessary to work through local committees, who would have to issue prices from time to time, largely founded on information which could easily be supplied by the central costing department. Profiteering and speculation are only possible during scarcity. A plentiful supply is undoubtedly the best means we can find for bringing down prices. This House, by its vote to-night, must take care lest by vexatious interference and by pandering to an ill-informed clamour they may aggravate the already enormous difficulties under which our trade is conducted at the present time.


There has been much criticism of this Bill from all quarters. What has struck me about most of the speeches made against the Bill is the fact that very few of them do more than express a general feeling of disapproval, without in any way indicating what those who are opposed to the Bill would put up n its place. My hon. Friend (Lieut.-Colonel Guinness) was different in this respect, that he did indicate what were his views as to how this question of profiteering should be met. If I understood him lightly, it is his opinion that the proper way to deal with profiteering is that the Government should step in and should control prices of all commodities in all circumstances. I see very great difficulties. if not dangers, in any course such as that. I wonder very much whether my hon. Friend is going to vote against the Bill. I wonder very much whether the right hon. Gentleman the late Food Controller (Mr. Clynes), who made such a damaging attack on the Bill, is going to vote against it. I shall be very much surprised if you do not find both the right hon. Gentleman and my hon. Friend in the Lobby to-night in support of the Bill.

When I heard the speech of the right hon. Gentleman who introduced the Bill one thing which astonished me mote than anything else was the fact that the Bill had not been introduced before. He spoke of the effect of profiteering upon a far larger scale than it had ever occurred to me that it had anything to do with. He spoke of profiteering as being one of the principal matters which affect the foreign exchanges. He said that the existence of profiteering in this country was to a great extent the cause of the increased imports over exports, and generally he made a very strong case in favour of bringing in some measure at the earliest possible moment to deal with this question. If that is so, what has struck me as amazing is that the Government did not introduce this Bill or some Bill of this kind long ago. We know this was a matter of immense importance and great significance to the country during the War, and that it has been so ever since, gradually culminating in the present state of affairs. Yet now, when this Session of Parliament is coming to an end, despite the dangers the Government admit in regard to this matter, they come forward for the first time and embody their proposals for dealing with it in a. Bill. It seems to me extraordinary. I am not going to play the part of a person who criticises the Bill in detail and pretends he does not wish to support it, and yet he goes into the Lobby in support of it. I consider that this Bill, in the present state of the country, is required by the country. Everybody has admitted that profiteering is going on to a very great extent in many trades and in all sorts of circumstances at the present time, and if this Parliament were to separate without having dealt in a drastic manner with this question of profiteering, which is universally recognised to be of immense importance, it would be a slur upon this House, which, I hope, it will not deserve. We know quite well that the cry of profiteering is to a certain extent fostered by the high prices which are generally prevailing on all sides. Those high prices must eventually fall. The present prices cannot possibly continue beyond a certain limit. There must come a time when prices will fall to a level more proportionate to those which prevailed at the beginning of the War.

The real cause, as we all know, of the high prices are such questions as shortage of material, shortage of ships, leading to high freights, and the inflation of currency, which we have been discussing in almost every Debate for many weeks past. The cure for all these causes, as hon. Members have said over and over again, and they can never state too frequently—the euro for inflation of currency, for shortage of skipping, and all the different elements which go to make high prices, is one thing and one thing only, and that is to increase the productivity of the country. It is vastly important that this should be brought home more than it has been to all classes of the community, and I hope that before long the Government will undertake propaganda in this direction. But in addition to these general causes which operate to keep up prices there are others which I hope will be cured by the passage of this Bill. One of the principal causes of high prices is the fact that people are so extremely stupid as to pay them. Not long ago I happend to be sitting next to a. woman at dinner and she told me that she wished a short time ago to buy a coat and skirt from a well-known dressmaker in London. She said that before the War this coat and skirt would have cost at the very outside £ 21, but she was now asked to pay the incredible sum of £78 15s.


Who is going to pay it?


In spite of the fact that she is a very rich woman who could have paid that amount, I am glad to say that on hearing the price she walked out of the shop. If that charge of £78 15s. could be justified it seems to be only right that it should be justified, and I hope that the Bill will make it possible to compel people either to justify that kind of charge or else reduce the price. But I am sorry to say that there are people—who they are I cannot imagine—in this country who will pay these absurd prices, and so long as you get any portion of the public to pay such absurd prices, which could in no circumstances be justified, so long will you get profiteering. Profiteering, of course, would be prevented in ordinary circum- stances by Competition. I was much impressed this evening by hearing the Parliamentary Secretary to the Ministry of Food (Mr. McCurdy) state as a member of the Government that competition had been, replaced by combination. Seldom has a more serious statement been made in this House, and if it is true then we are face to face with an extremely serious situation. In the past, what always rectified profiteering was the natural law of competition, and if we have got great combinations of the different trades to maintain prices, then we want a Bill which will prevent those combinations from succeeding against the public. The ex-Food Controller (Mr. Clynes) said that this Bill hit the little man and did not touch the big man. I think that he was answered effectively by the Parliamentary Secretary, who showed that it was a Bill which hit both the big and the little man, if properly administered in the way it is intended to be administered. If this Bill will destroy these nefarious, so far as they are nefarious, practices of combination of traders, then I sincerely welcome it!

The right hon. Gentleman, in introducing the Bill, referred to the impression, which was I think created by him self, that this Bill would not apply to Ireland. He has rectified that, and we know now that the Bill, as I think it should, is going to apply to the United Kingdom as a whole. I am extremely glad to find that the Bill is to apply to Ireland. Not because I do not realise that there may be difficulties of detail, in matters which will have to be cured possibly in Committee or by subsequent legislation or Order. This question of local tribunals is a difficult one, and I was impressed greatly by the argument of the hon. Member for Hornsey (Mr. Kennedy Jones) as to the difficulties which might face these tribunals in deciding local matters with regard to profiteering. But in spite of those difficulties, and the fact that in Ireland, more than in other parts of the United Kingdom, there may be difficulties with regard to the setting up of tribunals and the proper administration of these' questions, at the same time I feel that we are dealing with a very urgent and vital problem with which we must deal without delay, and if the Irish people were to be excluded from a measure of this kind, which is, at any rate, designed to check profiteering, you would be treating them with gross injustice and putting them in an entirely different category from the rest of the United Kingdom in matters of legislation, which I think is unnecessary. I am glad that this Bill has been applied to-Ireland, and I hope sincerely that as a result of it the prices of a great many articles of universal consumption which are at present so high will be reduced. I trust that the Bill will succeed, at any rate, in getting at the main basis of profiteering, and I shall vote for it gladly in the 'belief that it will decrease prices and give some small indication of what we all so much desire to see, a resumption of productivity, prosperity, and the normal life of the country.


If this Bill did what my hon. Friend in his last sentence suggested. namely, deal effectively with the profiteer, I venture to suggest that there would be no difference of opinion in any part of the House as to the attitude we ought to adopt. After all, the whole question turns on whether this Bill is likely to have the effect that every Member desires. In that connection one is compelled to keep in mind that the circumstances under which this Bill is introduced are best calculated to cause very great suspicion. When I remember that this House set up a Select Committee, and that one of the first witnesses was a Minister, paid for this particular job, responsible for this work, who above any other Minister of the Crown should have known all the circumstances connected with food, that on one day he appeared before the Committee and in substance said that all this talk of profiteering was grossly exaggerated in the country, and added that so far as he was aware the Government have no real plan, and when we remember that that Minister was followed the next day by my right hon. Friend (Sir A. Geddes) with not only a cut-and-dried plan, with not only a condemnation of profiteering, with not only a very serious indictment as to what is taking place, but the statement that the Government had been considering the matter for weeks, we realise that one of two things must result. Either there is no co-ordination in the Ministry itself, either the Food Controller is kept ignorant of the Government's policy or is not considered of sufficient importance to be consulted, or, alternatively, the Government, in a panic have produced a scheme that, to say the least, shows a very hasty conversion. I submit that that fact in itself is not only calculated to cause mistrust in the country, but it destroys confidence in the Government.


I understand the right lion. Gentleman to say that the Food Minister stated that profiteering has been grossly exaggerated in the country. It would be a mistake if the country were to be under the impression that the Food Minister has made a statement of that sort. He said it had been "placed out of its proper perspective." While the right lion. Gentleman has been speaking I have referred to the notes, and I find that that was so.


I accept the position that it was exaggerated, because that is, after all, what he meant.


"Placed out of proper perspective!"


The Food Minister was followed the next day by the right hon. Gentleman (Sir A. Geddes) who made the statement that the position was so serious that the Government must promptly produce a Bill. Therefore, with great respect to the hon. Gentleman, I do not think I overstated the case when I said that one Minister at least, to put it no higher, took a different view on this question from the Minister who followed him the next day in the witness-box. I leave the House to judge as to that point. I proceed at once, to suggest that this Bill, whilst it attempts to deal with profiteering, does not, in the considered judgment of the members of our party at least, deal with the right people. It is true, and no one can deny it, that there is profiteering amongst small shopkeepers. It is equally true that the real cause of profiteering is the trust and combine, and I am not so sure whether the Government themselves can be exempted from blame in this connection. Surely it will be admitted that the profiteer has a much better chance, to put it no higher, with a shortage of supply? It is an opportunity for him that is obvious. Then why do the Government themselves withhold the stocks they have, and give a chance to the profiteer? It is not a sufficient answer to point to the illustration of oil, as was done by the Under-Secretary in the early stage of the Debate. He answered the charge by saying, "Look what happened when we released the control of oil!" Perfectly true. But that is an entirely different thing— releasing the control of oil and placing the surplus supplies that the Government had on the market. Let us take wool. Will it be urged for a moment that the Government have not large-surplus stocks of wool? Can it be argued that the release of that wool will not affect the market to the advantage of the consumer? Will it be argued that it will not even give employment? Therefore, it is for the Government to recognise that if the profiteer is out to take advantage, there is nothing that so plays into his hands as a shortage of supply. It is for the Government to recognise that particular fact.

On the other hand, I should like to try to-visualise the kind of system that is going to crop up in all parts of the country. We know perfectly well that what happened with the old tribunals under the Military Service Acts was this: That what constituted a claim for exemption in one district or one town did not constitute a claim for exemption in another town, with the result that we not only had all manner of anomalies, but we had all manner of abuses. I can quite understand that even under this Rill some local authority will be treating as a virtue what another local authority will be Creating as a vice. That certainly is not calculated to help things. After all, the real point is that any complaint lodged under this Bill must be lodged, as my right hon. Friend pointed out, by the consumer himself,, the consumer in those cases in the main, being poor people. But who is going to lodge a complaint against the trust or combine? Who is likely to split on them? The result will be that the real culprits in this matter will go untouched. An. hon. Member says, "Not likely," but then what has happened during the existence of the Ministry of Food? Long before this-Parliament, for three years, every power sought by the Government was conceded" by the House of Commons, and the Ministry of Food was denied no power that it asked. D.O.R.A. was put into operation and that gave unlimited power to any Government Department. Is it not ridiculous, after nearly five years, with known profiteering and with the complaints of profiteering, that a Minister speaking in support of this Bill this afternoon should say that one of the first necessities of the Bill was in order that an investigation might be made. What has been happening for all these years? What have the Departments been doing? What were they set up for and what is the staff at their disposal doing? I submit it is too late to come to the House of Commons at this time, with the known cases of profiteering, and suggest that investigation is necessary at this time of day. The Select Committee, who after all are responsible to this House, ought to go on with their work. The Government have powers to-day which are not exercised. We can have a series of Interim Reports from that Committee and the Government can put those into operation under D.O.R.A. My right hon. Friend opposite says, "No," but whenever the Government want power they take it and they always bring D.O.R.A. to their rescue. Surely on an urgent matter of tins kind, with so much dissatisfaction and unrest, every step ought to foe taken to deal effectively with profiteering! Because we believe that this Bill does not go far enough and will disappoint the people, and when it disappoints the people will cause far more dissatisfaction than if nothing had been done, we intend to move Amendments in Committee stage. Our -difficulty is as to whether we ought to re-'fuse a Second Reading to the Bill. Nothing, in our opinion, has been said in favour of the Bill. But," on the other hand, the difficulty is whether we ought to take the step on Second Reading of refusing to give consideration to a measure that might be amended in Committee. We intend to amend the Bill if we can in Committee. We believe that it ought to be amended and that it will not do in its present form what has been urged in its favour. If it did what the Parliamentary -Secretary intimated in his speech, it would indeed be a better Bill than it is now. I can only repeat that we will give a Second Reading to the Bill, not because we believe it to be a good Bill. We believe it to be a bad Bill, but we will make some effort to amend it in Committee. Above all, we would urge the House to take note of what after all is an undoubted fact, that of all the causes of unrest profiteering is probably worse than all others. It is not only worse because the people feel that there are men taking advantage of the sacrifices of others, but it enables other people to take advantage of profiteering to make the task of the workers far more difficult than it is. Because we believe that the Government ought to deal with this question, and because we believe it must be dealt with, we will give support to the Second Reading, reserving the right in Committee stage to move Amendments which in our judgment will strengthen the scope of the Bill, and we hope deal with the cause which the House generally has agreed ought to be dealt with.

The MINISTER of LABOUR (Sir Robert Horne)

There is one thing this Debate has made perfectly clear, and that is that profiteering is an admitted evil in this country at present. In the words which the right lion. Gentleman (Mr. Thomas) uttered before he sat down he described in grave language the evil which he believed to exist. It is at present one of the most active causes of unrest which exist amongst the labour population of this country. As the Minister of Labour evidence of this fact is constantly being brought to my notice. The commonest articles of daily consumption have reached prices which make it sometimes almost impossible to acquire them. A reel of cotton which used to be 1 ½ d. before the Wail is now 7½d. Boots are three times their ordinary price, and the cost of woollen clothing at times reaches such a price that people find it extremely difficult, if not impossible, to adequately clothe themselves. There is an admitted evil and we have got to find a remedy. This Bill is the Government's remedy for this evil. We do not profess that it is a complete remedy. Nobody in his senses would suggest that it is a perfect Bill or that it will do all that many of us would like to see accomplished. But to all people who have that complaint to make I venture to suggest that they should draft their Bill and I will undertake to find more holes in it than they have discovered in this Bill. I have listened to a considerable portion of this Debate, and I do not think that there is a single objection which has been stated to the Bill which had not already occurred to our selves. The topic with which we are dealing is a very elusive one and the difficulties of dealing with it effectively are very great. In the meantime we propose this measure. We do not suggest it is permanent. It is only to last for six months and the country in the meantime will not be entirely defence less. On the other hand, the Committee which was set up will remain in being and I hope that it will give due consideration to the evil which we to-day have been considering, and that it will discover after more thought and reflection the best measures which can be taken for the purpose which I am sure we all wish to see achieved. One of the main difficulties which was raised early in the Debate by the hon. Member for Hornsey was a legal one winch he specially asked me to take note of. He said that this is the first time that it has ever been made a criminal offence for a man to do anything which you cannot exactly define, and he said it outraged all the principles of English law. I would ask the House to remember what would have to happen under this Bill before you got the length of charging a man with an offence for which penalties could be imposed. In the first place, you may have the Board of Trade considering the circumstances of the case, and if the Board of Trade think it sufficiently serious, not just taking the ordinary method of asking the man to take what they regard as a reasonable price, but sending it to a Court of summary jurisdiction. Or again, if one of the tribunals which is set up under the Bill comes to the conclusion that it is not enough for them simply to ask the offender the remit the balance of the excess over the true price, they again may remit the matter to a Court of summary jurisdiction to be dealt with, and only before that Court can a man be dealt with penally.

It is inconceivable, in the first place, that either the Board of Trade or these tribunals are going to report a matter to a Court of summary jurisdiction unless the case is one in their view sufficiently serious to have penalties imposed. But in answer to the general complaints that profiteering has never been defined, I would venture to suggest this. The hon. Member for Hornsey described profiteering as a gross offence. If it is a gross offence he surely knows what it means. The hon. Member for the Edge Hill Division of Liverpool (Sir W. Rutherford) said that in his view for anybody to take an illegitimate profit in these days was to commit a most heinous offence, but again, if that is true, he must know what it means to take an illegitimate profit, and if those two hon. Gentlemen are so well apprised of what this matter really means, would it be impossible for them to sit upon one of these committees and decide whether an illegitimate profit has been taken or whether a gross offence is being committed? The real fact is this, that we are only confused because for the first time this thing that we all object to so much has taken place. We have never been in this particular condition before— at least, not in our lives. We have never known the prices raised to the great height to which they are being raised to- day, with such a shortage of commodities in this country, and these are the conditions under which we are compelled to face this difficulty. Juries every day in. this country are deciding matters equally indefinite, but equally easy to decide. There is not, I should imagine, a single jury sitting from day to day in this country that has not at some stage got to decide whether a man has acted reasonably or not. Somebody said in the course of the Debate that that only occurs in civil cases, but the term "reasonable" is as well known in the criminal as it is in the civil law. Under the licensing Statutes a licence holder may be prosecuted if he gives certain classes of people more than a reasonable refreshment. Is it easier to decide what a reasonable refreshment is than to decide what is a reasonable profit?


What Section of the Licensing Act is that?

10.0 P.M.


I have not the particular Section by me, but the hon. Member will find it in the Licensing Act of 1910, and the offence is in connection with a certain class of ladies who sometimes, frequent public-houses, and it is in connection with them that reasonable refreshment is referred to, and you will find other instances of the same thing in the Licensing Act, which provides that the licensee may be penalised if he does not take reasonable precautions in his bar against drunkenness; and again, under the Locomotives Act, it is a crime to drive at an unreasonable speed, having regard to the conditions of the traffic. There is an entirely indefinite offence with regard to which a judge has got to make up his mind, and those hon. Members opposite who belong to the great coal industry know that under the Coal Mines Regulation Act the coal-owner is found guilty of an offence, for which he can be punished both by fine and imprisonment, if he has not taken reasonable means to see that the provisions of the Act are carried out, and therefore we find embedded in the statutory law of this country this very phraseology which has now got to be interpreted again by the tribunals which are to be set up under this Bill. Consequently, I venture to say to the House that my legal conscience is entirely undisturbed by the criticism of the hon. Member. Now let me turn to the more formidable objections which have been urged by some hon. and right hon. Gentlemen- I was surprised to hear my right hon. Friend the Member for Derby (Mr. Thomas) say in his speech that the trusts and combinations were not dealt with under this Bill. If this Bill does anything, it deals with the trusts and the Combine. For the first time in our law the Board of Trade will be given by this Bill the power to make those investigations and inquiries without which no trusts can be broken up or their prices regulated and dealt with. It was suggested by my right hon. Friend the Member for Platting (Mr. Clynes) that no complaints would ever be urged or made to the Board of Trade or to the tribunals -against the wholesale manufacturer, for the reason. I think he said, that they were sharing in the profits or in the spoils, but a moment's reflection will dissipate that suggestion. If' you attack the retail man, where is he going to put the blame? He is going to put the blame upon the wholesale man from whom he purchased, and when the wholesale man is tackled upon the same topic, where is he going to put the blame? He will refer you to the manufacturer from whom he purchased, and accordingly this whole fabric of attack seems to me to be the product of a misapprehension of what this Bill really proposes to do.

My right hon. Friend the Member for Platting made a suggestion as an alternative, and, indeed, I think he is the only Member of the House who in the course of this Debate has suggested an alternative to the proposals of the Government. His suggestion was not a new one. It was that the Government should take control of all the articles that are involved; but what would that mean? We have had a sufficient army of people to take State control of a comparatively few commodities, but we are now asked by the right hon. Gentleman to take control of all the articles in common use. One does not like to contemplate the possibility of what would be involved in that project, but it would involve, as he foresaw, control of prices—that you would, in fact, have to fix flat prices. I venture to submit that that is the worst way possible, and a most unfair and an unjust way, because the conditions of purchase and sale vary so much all over the country, and what you applied to one might be very unjust if applied to another. Accordingly, you cannot deal with this matter on the principle of fixing flat prices. My hon. and gallant Friend below the Gangway suggested that you should fix maximum prices. What does that mean As soon as you fix maximum prices you fix minimum prices, for the only result would be to make your maximum the flat price, which would mean a combination of both evils I have suggested.

Lieut.-Colonel W. GUINNESS

Is the right hon. Gentleman not arguing from war conditions, where supplies, as well as prices, were controlled, and where there was no competition to keep down prices below the maximum


The very reason for this Bill, if my hon. and gallant Friend reflects, is that there is a shortage of commodities, and, therefore, just that absence of competition which makes it necessary to deal, as we propose to deal, with the evils which have arisen. I think I have dealt with the main argument by which this Bill has been opposed. I should like to say, before sitting down, that I think it will serve both a positive and a negative purpose. Positively, I believe it will succeed in finding out the profiteer and in dealing with him effectively. But I think there is also an advantage to be gained negatively from this Bill. I am perfectly certain a great many people to-day believe that profiteering is taking place in instances where prices have been regulated by circumstances entirely out of the control of the people who are selling the articles. It is undoubted that the prices of many raw materials have gone up from perfectly natural economic causes. It is also undoubted that many of the prices of articles to-day are due almost entirely to the rise in wages. I do not think anyone will doubt that, and, accordingly, one of the services which I hope this Bill will render will be to create such inquiries into the facts as will make people understand, not only the cases in which profiteering takes place, but the cases in which it does not take place. I hope, finally, it will bring home to the mind of everybody that nothing raises prices so much as shortage of output, and that an increased production is the best hope of reducing the cost of articles which we require in this country. I venture to ask the House to give a Second Reading to this Bill now. There is much else to do to-night, and Members will have an opportunity of dealing with the Bill in Committee. The Government intend to move that it be committed to a Committee of the Whole House, and, accordingly, there will be every opportunity for Members to move the Amendments which they would like to suggest.


Can the right hon. Gentleman tell us whether this Bill is intended to deal, or will deal, with landlords?


I think that is dealt with by the measures passed by the House connected with the acquisition of land.


Before the House divides on this Bill I am sure hon. Members will feel renewed confidence in the Government by the statement of the right hon. Gentle-man that the whole House will have the opportunity of suggesting Amendments in Committee. But there are one or two points which, while they are fresh in our minds, it is just as well should be stated. I am sure the House is grateful to the right hon. Gentleman who has just resumed his seat for the points he has put forward, and which, so far as I am aware, have not been mentioned in the course of this Debate. The first is this, that the real reason of this Bill, so far as he sees it —I will not go the length of saying so far as all members of the Government seeit—is eventually to trace the source of profiteering. He tells us—and it is for that reason I propose to support this Bill—that directly the retailer is penned in a corner he will turn to the wholesaler, and directly the wholesaler is penned in a corner he will turn to the combine, and it is then, and then alone, that we shall get to the true source and the true profiteer. It has been said that it is difficult to find a profiteer. I say it is very simple. It is not the grocer who is obliged to put 2d. on a tin of salmon, but the man who buys cargoes of salmon between Canada and here and turns them over at 300 per cent, before the retailer can get in. These are the people we want to find, and they are the people I at first feared would shelter behind this Bill. In the first instance, when this Bill was introduced, I thought it was purely a flag to be waved on the eve of the adjournment of the House in the face of a deluded public, because they felt aggrieved at the price they were called upon to pay for commodities. But if the right hon. Gentleman who has just sat down speaks for the Government, he is telling this House that the Government seriously mean to trace profiteering to its source. A number of examples of profiteering have been given this evening. I wonder whether the right hon. Gentleman considers the Crown property which is now falling in, on which rentals have been increased from 500 to 600 per cent, is profiteering?

The whole question of increase of price requires the careful revision of the Government, and when the right hon. Gentleman stated that it was the sole or principal cause of unrest in this country he was stating a cold truth. Profiteering is the apple in the garden of England, and it is likely to be the cause of more-unrest than any other matter. The Minister of Labour told us in that frank method of address of his, which is so refreshing in this House, that the true cause was the lack of production. In the last ten days, when I rebuked a certain shipbuilding concern for the lack of work they were turning out in regard to something in which I was personally interested, they told me in the last ten days one of the workmen had been fined £3 by his society for turning out more work than the society considered it expedient any one man should turn out. [Hon. Members: "Shame!"] I do not want to refer to the actual firm, but I am quite willing to give the name to any Labour Member. It was a question of caulking—as to how many feet per day one man should caulk—and it was freely stated that the amount the society allowed per day was something like a quarter of what it was before the War, and because he had exceeded that he was, fined £3 by his society. I would say to the Labour Benches, if you think this country is going to survive in international competition or defeat profiteering in such circumstances you are greatly mistaken.


I have seen Bills introduced into this House to make people sober by Act of Parliament. I have seen Bills introduced to make them moral by Act of Parliament. But this is better than that. This is a Bill, so far as I can make out, to make people unselfish by Act of Parliament. So long as human nature remains what it is every man is going to get as big a profit as he can. From my knowledge of human nature that is likely to continue in spite of any Act of Parliament. The right hon. Gentleman opposite rightly said that up to now there has been no alternative to this method of dealing with profiteering. The only scheme put forward was even more gross, because it had more interference with individual liberty than his own scheme. That is possibly true. Even if that were so I do not think it is convincing. Is it any justification for bringing in a Bill which is demonstrably unjust? One of the first canons of legislation, to which all good legislation must conform, is that any Act of Parliament should be capable of universal application, and that it should be applied universally so as riot to create a sense of injustice between those people who suffer from the law and those who should suffer but escape.

That is one of the first canons of legislation—that it should be of universal application. This legislation is not capable of universal application. Its application is going to be purely accidental, and in accordance with the complaints which happen to be made against certain traders. It has been recognised by the right hon. Gentleman that all the action taken under this law will begin by action against the small tradesmen—against the retailer. Then, as he rightly said, the retailer will have a case against the wholesaler, and then the right hon. Gentleman will possibly be able to inquire further. The very fact that there may be in one town, or in the street of that town, a man who is prosecuted, and in another town, or in the street of that town, the man who escapes prosecution, will make this law universally unpopular with all liberty-loving Englishmen. More than that. What is the alternative to this legislation?

The alternative, surely, is that we should break down all rings and combinations, which everyone agrees are the basis of the profiteering that is going on. We all know that it is the rings and combines who are managing to push up prices against the wholesaler and against the retailer. This Bill is pointed out as dealing with that. Can anybody in their senses look at a Bill which imposes a maximum penalty of £200 and say that it is going to deal with the Standard Oil Trust or companies of that description! £200 is a mere flea-bite to any of these. The only operation this Bill can have is against the unfortunate retailer who is pushed into his position owing to the high prices charged by the wholesaler. The best way of dealing with these combines is surely to allow free competition with them! At present the Government prohibits imports coming into this country in competition with the goods held by the combines. The only people licensed to import goods into this country are in the various rings; consequently, there is no possibility of competition with them. Surely the obvious way of dealing with that evil is to remove the licensing system, and allow anyone to import, in order to compete with the combines and bring down their prices.

If you have a rigid licensing system, allowing only one fried-fish shop to be opened in one village—as is the ease at present—and you prevent a man going into that same business because the first one is close by it, then the man who has the monopoly of the fried-fish shop will put on a monopoly price. In every case the way to get at the present profiteering is to increase the competition by allowing free importation and licenses to anybody who wants to go into any sort of business whatever. [Hon. Members: "Divide!"] There is one thing only which would make me vote for this Bill— that is, if it were really going to deal with the prime profiteer of the lot behind the combines, the man who owns the land. The man who owns the land is sacred in this House, and his interests, at any rate, must not be touched. If a private person wants to start to build cottages and has asked for land let at 30s. an acre, and he is asked £300 or £400 an acre for that land, is that man profiteering? He is only asking 'about 100 times what he ought to get— that is, the value for which it is rated. That landlord is the biggest profiteer, but he will escape entirely. When land is wanted for allotments and ten times the present rental is asked, will he be a profiteer? This Government would not tolerate any interference with the sacred rights of landlords. I am told that this Bill has been introduced in view of the Ponte fract Election, and that some hon. Members are voting for it because it will be popular. When the country has had a taste of this measure, when the traders have been haled up before the new Star Chambers in all our towns, and some of them have been punished for a crime which is not theirs, and probably have been tried by their own competitors in business, its popularity will be gone. The members of these tribunals will not be people trained in the law, and they are going to be bodies similar to the military tribunals during the War. I do not think this Act will be popular, and the only part -of it that wilt be popular is the provision that it will end in six months' time. The idea that the Government think they can achieve popu- larity by passing a law which they know is unjust and incapable of universal application is one which will not go down with She country. You start by interfering with the laws of supply and demand, and they always come back upon you and hit you upon the head. This proposal interferes with the natural competition of men to supply articles to the consumer in competition one with the other. It interferes with the laws of nature, and the laws of nature will beat you every time. If you go back to the natural laws of sup-

ply and demand, free competition and imports, then by that means only you will succeed in eliminating the profiteer.


rose in his place, and claimed to move, "That the Question be now put,"

Question put accordingly, "That the word 'now' stand part of the Question."

The House divided: Ayes, 251; Noes, 8.

Division No. 92.] AYES. [10.34 P.m.
Adair, Rear-Admiral Davies, Sir W. Howell (Bristol, S.) Jones, G. W. H. (Stoke Newington)
Addison, Rt. Hon. Dr. Christopher Davies, M. Vaughan- (Cardigan) Jones, Henry Haydn (Merioneth)
Agg-Gardner, Sir James Tynte Dawes, J. A. Jones, J. Towyn (Carmarthen)
Amery, Lieut.-Col. L. C. M. S. Dennis, J. W. King, Commander Douglas
Astor, Major Hon. Waldorf Doyle, N. Grattan Knight, Capt. E. A.
Atkey, A. R. Edge, Captain William Knights, Captain H
Baldwin, Stanley Edwards, C. (Bedwellty) Larmor, Sir J.
Balfour, George (Hampstead) Edwards, J. H. (Glam., Neath) Law, Right Hon. A. Bonar (Glasgow)
Barnes, Rt. Hon. G. N. (Gorbals) Elliott, Lt.-Col. Sir G. (Islington, W.) Lewis, Rt. Hon. J. H. (Univ., Wales)
Barnes, Major H. (Newcastle, E.) Eyres-Monsell, Commander Lewis, T. A. (Pontypridd, Glam.)
Barnett, Major Richard W. Fisher, Rt. Hon. Herbert A. L. Lloyd, George Butler
Barnston, Major Harry Flannery, Sir J. Fortescue Lort-Williams, J.
Beauchamp, Sir Edward Foreman, H. Loseby, Captain C. E.
Beck, Arthur Cecil Forester-Walker, L. Lowther, Major C. (Cumberland, N.)
Bell, Lieut.-Col. W. C. H. (Devizes) Foxcroft, Captain C. Lunn, William
Bellairs, Com. Carlyon W. Fraser, Major Sir Keith M'Curdy, Charles Albert
Benn, Sir Arthur S. (Plymouth) Gange, E. S. M'Laren, R. (Lanark, N.)
Bethell, Sir John Henry Gardiner, J. (Perth) Maclean, Neil (Glasgow, Govan)
Betterton, H. B. Geddes, Rt. Hon. Sir A. C. (Basingstoke) Mallalieu, Frederick William
Billing, Noel Pemberton George, Rt. Hon. David Lloyd Malone, Col. C. L. (Leyton, E.)
Birchall, Major J. D. Gibbs, Colonel George Abraham Malone, Major P. (Tottenham, S.)
Bird, Alfred Gilbert, James Daniel Marks, Sir George Croydon
Blades, Sir George R. Gilmour, Lieut.-Colonel John Matthews, David
Borwick, Major G. O. Glyn, Major R. Mildmay, Col. Rt. Hon. Francis B.
Boscawen, Sir Arthur Griffith- Gould, J. C. Mitchell, William Lane-
Bowyer, Captain G. W. E. Grant, James Augustus Mond, Rt. Hon. Sir Alfred Moritz
Brace, Rt. Hon. William Greame, Major P. Lloyd Morison, T. B. (Inverness)
Briant, F. Green, A. (Derby) Morris, Richard
Bridgeman, William Clive Green, J. F. (Leicester) Mosley, Oswald
Briggs, Harold Greene, Lt.-Col. W. (Hackney, N.) Mount, William Arthur
Britton, G. B. Greenwood, Col. Sir Hamar Murray, Lt.-Col. Hon. A. C. (Aberdeen)
Broad, Thomas Tucker Gregory, Holman Murray, Major C. D. (Edinburgh, S.)
Brown, T. W. (Down, N.) Greig, Col. James William Murray, Dr. D. (Western Isles)
Buchanan, Lieut-Colonel A. L. H. Gretton, Colonel John Murray, Hon. G. (St. Rollox)
Buckley, Lieutenant-Colonel A. Grundy, T. W. Murray, William (Dumfries)
Cairns, John Guest, J. (Hemsworth, York) Neal, Arthur
Newbould, A. E.
Campion, Col. W. R. Guinness, Capt. Hon. R. (Southend) Newman, Sir R. H. S. D. (Exeter)
Cape, Tom Hallwood, A. Nicholson, R. (Doncaster)
Carew, Charles R. S. (Tiverton) Hall, F. (Yorks, Normanton) Norris, Sir Henry G.
Carr, W. T. Hamilton, Major C. G. C. (Altrincham) O'Grady, James
Carter, W. (Mansfield) Hartshorn, V. O'Neill, Captain Hon. Robert W. H.
Casey, T. W. Henry, Denis S. (Londonderry, S.) Onions, Alfred
Child, Brig.-General Sir Hill Herbert, Denniss (Hertford) Ormsby-Gore, Hon. William
Clay, Captain H. H. Spender Higham, C. F. (Islington, S.) Palmer, Brig.-Gen. G. (Westbury)
Clough, R. Hilder, Lieut.-Col. F. Parker, James
Clynes, Right Hon. John R. Hirst, G. H. Parry, Lt.-Colonel Thomas Henry
Coates, Major Sir Edward F. Hope, James Fitzalan (Sheffield) Pearce, Sir William
Cobb, Sir Cyril Home, Sir Robert (Hillhead) Pease, Rt. Hon. Herbert Pike
Cockerill, Brig.-Gen. G. K. Howard, Major S. G. Peel, Lt.-Col. R. F. (Woodbridge)
Colfox, Major W. P. Hughes, Spencer Leigh Pennefather, De Fonblanque
Colvin, Brig-Gen. R. B. Hunter, Gen. Sir A. (Lancaster) Perkins, Walter Frank
Conway, Sir W. Martin Hunter-Weston, Lieut.-Gen. Sir A. G. Perring, William George
Cope, Major W. (Glamorgan) Hurd P. A. Philipps, Sir O. C. (Chester)
Cory, Sir James Herbert (Cardiff) Hurst, Major G. B. Pollock, Sir Ernest Murray
Cowan, D M. (Scottish Univ.) Inskip, T. W. H. Pratt, John William
Cowan, Sir H. (Aberdeen and Kinc.) Jackson, Lieut.-Col. Hon. F. S. (York) Prescott, Major W. H.
Craig, Col. Sir James (Down, Mid) Jameson, Major J. G. Pretyman, Rt. Hon. Ernest G.
Curzon, Commander Viscount Jesson, C. Pulley, C. T.
Dalziel, Sir Davison (Brixton) Jodrell, N. P. Purchase, H. G.
Davidson, Major-Gen. Sir John H. Johnson, L. S. Rae, H. Norman
Davies, Alfred Thomas (Lincoln) Jones, Sir Edgar R. (Merthyr Tydvil) Raffan, Peter Wilson
Davies, Sir Joseph (Crews) Jones, Sir Evan (Pembroke) Raw, Lieut.-Colonel Dr. N.
Richardson, Alex. (Gravesend) Sprot, Colonel Sir Alexander Ward-Jackson, Major C. L.
Richardson, R. (Houghton) Stanler, Captain Sir Beville Ward, Colonel L. (Kingston-upon-Hull
Roberts, F. O. (W. Bromwich) Stanley, Colonel Hon. G. F. (Preston) Warren, Sir Alfred H.
Robinson, S. (Brecon and Radnor) Stephenson, Colonel H. K. Weston, Colonel John W.
Robinson, T. (Strettord, Lancs.) Stewart, Gershom Wheler, Colonel Granville C. H.
Rogers, Sir Hallewell Strauss, Edward Anthony Wignall, James
Rowlands, James Sugden, W. H. Williams, A. (Consett, Durham)
Rutherford, Sir W. W. (Edge Hill) Sutherland, Sir William Williams, Lt.-Col. Sir R. (Banbury)
Samuel, A. M. (Farnham, Surrey) Swan, J. E. C. Williams, Col. Sir R. (Dorset, W.)
Samuel, S. (Wandsworth, Putney) Talbot, G. A. (Hemel Hempstead) Wilson, Colonel Leslie (Reading)
Sanders, Colonel Robert Arthur Taylor, J. (Dumbarton) Wilson, W. T. (Westhoughton)
Scott, A. M. (Glas., Bridgeton) Terrell, Capt. R. (Henley, Oxford) Wood, Sir H. K. (Woolwich, W.)
Seager, Sir William ' Thomas, Rt. Hon. J. H. (Derby) Wood, Major Mackenzie (Aberdeen, C.)
Seddon, J. A. Thomas, Brig. Gen. Sir O. (Anglesey) Wood, Major S. Hill- (High Peak)
Seely, Maj.-Gen. Rt. Hon. John Thomson, F. C. (Aberdeen, S.) Woolcock, W. J. U.
Sexton, James Thomson, T. (Middlesbrough, W.) Worthington-Evans, Rt. Hon. Sir L.
Shaw, Tom (Preston) Thomson, Sir W. Mitchell- (M'yhl) Yeo, Sir Alfred William
Shaw, Captain W. T. (Forfar) Tillett, Benjamin Young, Sir F. W. (Swindon)
Short, A. (Wednesbury) Tryon, Major George Clement Younger, Sir George
Shortt, Rt. Hon. E. (N'castle-on-T., W.) Vickers, D.
Simm, Col. M. T. Walker, Colonel William Hall TELLERS FOR THE AYES.—Lord E.
Smith, Capt. A. (Nelson and Colne) Walters, Sir John Tudor Talbot and Captain F. Guest.
Spencer, George A.
Archer-Shee, Lieut.-Colonel Martin Rose, Frank H. Wood, Major Hon. E. (Ripon)
Guinness, Lt.-Col. Hon. W. E. (B. St. E.) Wedgwood, Colonel Josiah C.
Hills, Major J. W. (Durham) Wolmer, Viscount TELLERS FOR THE NOES.—Mr.
Kenworthy, Lieut.-Commander Kennedy Jones and Sir F. Banbury,

Question put, and agreed to.