HC Deb 22 February 1926 vol 192 cc195-257

Again considered in Committee.

[Mr. JAMES HOPE in the Chair.]

Postponed Proceeding resumed on Question, That it is expedient—

  1. (a) to amend the Trade Facilities Act, 1921 to 1925—
    1. (i) by increasing from seventy million pounds to seventy-five million pounds the limit on the aggregate capital amount of the loans in respect of which guarantees under those Acts may be given; and
    2. (ii) by extending by one year the period within which such guarantees may be given;
  2. (b) to amend the Overseas Trade Acts, 1920 to 1924, by extending to the eighth day of September, nineteen hundred and twenty-nine, the period within which new guarantees under those Acts may be given, and by extending to the eighth day of September, nineteen hundred and thirty-three, the period during which guarantees under those Acts may remain in force."

Question again proposed.


When the proceedings were interrupted for the Private Bill I was saying that the Trade Facilities Act has had a substantial effect in preventing the volume of unemployment being greater than it has been, and that the Act has been of substantial use in promoting unemployment. It is, of course, impossible to give anything like an accurate estimate as to how far it has gone because its effects are not actually direct, but indirect. The ordinary contract provides that all the plant, machinery and materials, required in connection with the working of the undertaking, shall be purchased in Great Britain at the lowest prices under contracts requiring the contractor to certify on his own behalf and on behalf of the sub-contractors, that the plant, machinery or materials supplied is wholly of British manufacture. Any breach of this undertaking is to be reported to the Treasury. That in itself promotes an amount of employment by making a demand for these materials, but that amount of employment it is impossible to estimate. Last year my predecessor in this office stated in the House that the estimate of the advisory committee was that at least 100,000 men were in employment who would not have been in employment but for the existence of this Act, and that, I think, remains true at the present time. There are on the Paper one or two Amendments to the Resolution on which I shall have a word to say after I have heard what is said in their support, and I will not do more by way of anticipation now than to say that the first of these Amendments appears to me to be unnecessary.


I think I might save time if I say now that the first and fourth Amendments are not in order.


I am much obliged for the information. With regard to those in order, it will probably be more convenient if I wait to hear what is said in their support and deal with them in that way.


I rise merely to put a point of Order and to ask your ruling for the guidance of the Committee. I think the Committee will agree that it might be better if we had a short discussion on the broad principle of this legislation, and if you approve I would suggest that it would be much more convenient to take that course and then proceed afterwards to specific Amendments.


I think that would be as well. If the right hon. Gentleman wishes to speak now, there is no reason why he should not do so without moving his Amendment.


I did not rise to say anything, personally, at this stage of the Debate. I wanted to safeguard a general discussion.


There was one statement made by the right hon. Gentleman in moving this Resolution which greatly surprised many of us on this side of the Committee. It was to the effect that it was left to the discretion of the Committee as to whether trade was done with Russia or not. I always understood that the Government had put an embargo on the Committee with respect to any suggestion of trade with Russia, and that any such suggestion never came before the Advisory Committee or the Export Credits Committee for them to decide or to make any recommendation upon.

Speaking as a member of the Export Credits Committee I have no recollection of any proposal coming before the Committee suggesting that trade should be done with that part of Russia which is under the control of the Soviet Government. I confess my duty here often prevents me from attending the Committee but during my term of membership I do not remember such a proposal, and my impression is that the Exports Credits Committee's opinion was never definitely asked on the question of the advisability of carrying on trade with Russia. I thought that matter had been decided by the Government, and that any application which came forward would be returned automatically by the officials of the Committee with the information that it could not be considered. I wish to make my position clear. I am not suggesting for a moment that the view of the Government in regard to trade with Russia is not the view of the majority of my colleagues on the Committee, but it seems to me that the position of the Committee should be made quite plain; that there should be no misunderstanding that this is a Government policy determined upon by the Government, and that, in this matter, the Advisory Committee have no say, and have not expressed, at any rate recently, any definite opinion.


As the hon. Member says he is replying to my statement, may I say that I was speaking of the Advisory Committee under the Trade Facilities Act which is a body perfectly distinct from the Export Credits Committee. I was not dealing with export credits at all. As a matter of fact I believe that my statement applies equally to both Committees, but the Export Credits Committee does not strictly come within my province, and my hon. Friend the Secretary to the Overseas Trade Department will deal with that part of the Resolution.


I am rather surprised at the reply, because in all probability the Export Credits Committee would be the Committee most concerned with the question of trade with Russia. I am willing to leave that point for the moment, but I shall be interested to hear from the Secretary to the Overseas Trade Department as representing the Export Credits Committee whether my interpretation or that of the Financial Secretary, is the correct one. If those of us who hold views different from the views of the Government on this question, are given to understand that a Committee of which we are Members is responsible for this policy, then of course it gives us the opportunity of raising the whole question at the Committee. I always understood however it was not a matter for discussion by the Committee because it had been settled, and the policy had been laid down by the Government.

Passing from that question of procedure to the general question of the Trade Facilities Act, I suggest that this Measure which was started with the intention of helping in a special emergency, due to unemployment, is now developing on a scale far greater than anything that was imagined when the Government of that day first brought it into existence. This is a scheme which cannot be called Socialism, and cannot be called private enterprise. It is distasteful, I am told, to extreme Socialists, and distasteful also to strong supporters of private enterprise in the pure and unadulterated form. Many of us recognise, however, that it may be of service, and on both sides, whatever our views may be, we have sunk individual feelings in order to see if the scheme could be made to help employment.

It has been noticed in the past year that there have been certain developments in connection with the Trade Facilities Act. Some things we were not doing a year ago are now being done. Questions put to Ministers in the last year have elicited the fact that this Committee has a wide scope in regard to the work it has undertaken, and during the last six months we have seen more money being lent for such purposes as the replacemet of machinery than I believe has been done for some time. About nine months ago there was an hon. Member not now in the House who questioned the Government once or twice as to whether grants could not be made to help those industries that are suffering at the present time, not in regard to new trade, but in regard to the replacement of machinery and so forth.

The reason why I put down the Amendment in my name which has been ruled out of order was because of a certain amount of uncertainty in regard to the powers of the Trade Facilities Committee. We wanted to make certain whether the money could be used to help suffering industries in the way in which the shipbuilding industry, the steel industry, the iron industry, and other industries of that kind are suffering, and I have understood, from looking at the answers, that it is obvious that something could be done on those lines. There is one point I should like to put to the Minister, and that is in regard to the question of this money being used for the purchase of land. His predecessor in office, in answer to a question last July, stated that money could not be given for the purchase of land.

Technically, I can see the point that to buy land does not give any immediate employment in one sense, but, on the other hand, in the larger sense, if you have a factory and want to extend it, and if you want capital with which to buy land and put up fresh buildings and more machinery, I cannot see the difference between using this money to buy the land and using it to put up the machinery or buildings on the land. On the question of machinery, I feel satisfied, from the answer I received from the right hon. Gentleman this afternoon, in which he stated that at least £200,000 had been spent in the replacement of machinery, that at any rate what was rather a doubtful question a year ago is now no longer so, and that the money can be spent on the replacement of machinery.

I now come to the main point that I wish to urge on the Minister. I am not criticising the policy of the Government, but I want to point out the tremendous changes in the Government's policy in using public credit to help private enterprise in various forms as compared with the pre-War policy of any Government. Since the War we have had public credit being used to help the Co-operative Society, we now have an intimation from the Government of some idea of the use of public credit in order to help the farming industry, and we have the Trade Facilities Committee helping the manufacturers. All these schemes have been started at different times, and there is never careful consideration given to the whole question as to what line is being followed or the main principles that should guide the Government in this matter. If the Committee were to analyse the figures in connection with the loans that have been granted by the Trade Facilities Committee during the last nine months of the previous year, it would find that something like £18,000,000 has been recommended by the Committee. Out of that amount, nearly £5,000,000 or £6,000,000 has been expended on shipping, about £2,000,000 in connection with coal mines, about £2,000,000 has been used abroad, £500,000 in the Colonies or the Sudan, and £1,500,000 has been used for sugar-beet. The questions that come before me, on looking at those figures, are: How far are we really thinking out what we want to do with this money, or does a request come from a certain firm before the Committee, and is that request thought of simply and solely according to its own merits and no consideration given to the larger questions that may be connected with the approval or refusal of the request made?

Of the sum of £18,000,000 to which I have referred, I have given particulars of nearly £12,000,000. You find' that of that £18,000,000, one-third has been spent on shipping. It is quite true that there is hardly an industry in this country today that is more in need of help, but, on the other hand, one can well understand the criticism that has been aroused amongst certain interests in shipping, when they find that new ships are being built at the very time when they are complaining that the ships in existence cannot get enough work to do. Some hon. Members may have noticed the report recently presented by the Shipping Federation, in which, referring to last year, they speak about the depression in the shipping industry having continued, and they practically intimate that it is no better than it was at the commencement of last year.

Then I should like to ask the Minister whether, when a recommendation is made that £2,000,000 be granted for the coal industry in Kent, that has been thought out in connection with the fact that at the present time this country is spending a large sum of money on the coal industry. I do not know how soon these coal mines in Kent will come to the producing stage. Of course the industry there is quite in its infancy, and I presume it will take some time before the coal appears. But provided the coal is there, as is to be hoped, I should like to know how far the Committee who are considering this are really thinking out the whole coal problem. The Minister said that the matter must be left entirely in the hands of the Committee, but, personally, I do not agree with him. I question very much whether there are not some questions which ought not to be left in the hands of the Committee. I am not in any way criticising the composition of the Committee, or the men upon it, but you can ask a Committee of this sort whether, looked at from the narrow business standpoint, the recommendation in advance is a sound one. This Kent proposition may be absolutely sound, looked at from itself and quite apart from any other question, but it does seem to me—and here I disagree with the Minister—that the Minister must at some time have a say in a matter of this kind.

There is the larger question of shipping, and as to whether State guarantees can be continued to be used to help build more ships, I think that has to be put against the general need of shipping at the present time. Then the sugar-beet industry is being assisted to the extent of about £1,500,000 guaranteed by the State. The sugar-beet industry is receiving a great deal of support from the State, and, certainly, if it cannot make good with the help it is getting in its two-fold capacity from the State, then I think the industry must be deemed an utter failure in this country. I do want to put before the Minister that there are larger questions. I am not at all sure whether, if we are going on with this use of public credit, the composition of the Committee ought not to be much larger, or that a wider range of views should not be represented upon that Committee, and I think the Minister certainly ought to recognise that, on certain broad lines, the Government must express their opinion on certain ques- tions. I agree—we all agree that we think the policy pursued by these committees, or the Government, in regard to Russia is a mistake. Personally, I think that the Government ought to have expressed its view on many other questions besides that of Russia. In this matter, from the point of view of State credit, you cannot leave it to independent committees to recommend what they like. You cannot leave the matter entirely in their hands.

There is one other thing which is creating a certain amount of uneasiness. That is the fact, as has been noticed, that some of these guarantees have been given to firms of very high standing, firms which I have not the slightest doubt that, if they wanted to get their money on the London money market, would not have got it as cheap as by means of the Government guarantee, but they certainly would easily be able to get it. There are some questions in regard to one or two of these loans that some of us would like to put, and that have been mentioned; questions that will possibly occur to the mind of the Minister as to why, for instance, it was thought needful that firms of this standing should be helped, and favoured by being allowed to have a State guarantee. There are one or two other points I should like to mention before I sit down. One is as to why it is we do not find that more has been done in connection with Indian trade. This matter, I believe, has been raised in the House before. Those hon. Members who remember the beginning of these Committees will remember that help was not allowed to be given to India on account of the conditions in India. They had a great many goods at that time, and there was a condition of frozen credit which made it undesirable that more trade should be carried on. Some of us have been greatly surprised that we did not see more done in helping trade between this country and India by the Trade Facilities Act. I only raise the matter, and I should be glad to know what the Minister thinks, and as to why that help has not been given.

There was another suggestion made in this House some time ago which I think is well worthy of consideration; that was that there ought to be research work. That is, that instead of a Committee waiting to receive applications from the public, from here, or there, that there should be in the Government Department—perhaps the Minister can assure me that there is at the present?—a definite policy of trying to find work that it would be desirable to have, that there should be a Committee, or officials connected with the Committee, who should definitely lay out the best way in which this money can be used instead of waiting until—shall I say Providence?—brings applications in some form or other. I have wondered whether in the matter of the smaller municipalities the Minister was quite satisfied that the local loans and other Government assistance that has been given to these is all that is required. Many of us would much sooner see the State guarantee given to a municipality than to private enterprise. My right hon. Friend has mentioned the larger question that how far the State ought to be represented, and I do not intend to touch upon that point; but what I wish to lay special stress upon is this question of the composition of the Committee. I hope the Minister will consider whether the enlargement of the Committee would not be a wise move to make. Also I hope the Government will consider the policy of the Committees instead of leaving the whole question to drift. There is the State credit, and a great social power that we now use and that we never saw before the War. Instead of allowing the matter to drift, ought we not rather to try to divert it into channels where we shall see it used for the best possible purposes?


I agree with a great deal that the hon. Member for Finsbury (Mr. Gillett) has said, and especially in regard to the credits which he mentioned. This is practically a hardy annual. The Committee would do well to picture the position when this Act came into force in 1921, and note how different is the picture that we see to-day. In 1921 5 per cent. War Loan was standing at 83 and yielding 6 per cent., whereas at the present time one may say that Government credit is on a 4¼ per cent. basis. This was an emergency Measure, and I feel that we have got past emergency measures. The genesis of this scheme was unemployment. I am sure Members on every side of the House are anxious to do what they can to assist the unemployed, but I am sure this Bill and these advances must affect genuine trade; until we get back to genuine trade, and do away with palliatives, I feel confident that in the long run it does not really benefit the unemployed.

I have nothing to say against the Advisory Committee. I know some of them, and they are most capable business men who give their time, I think, in a voluntary capacity; but last year when I spoke on this Measure I suggested that the Financial Secretary to the Treasury should join that Committee, and I am disappointed to hear him say that the Treasury have no control over the Committee. The Treasury ought to have control over all the taxpayers' money, and I appeal to the Financial Secretary to consider the possibility of going on this Committee. The amount is now to be raised to £75,000,000. It is a large amount. I think the hon. Member for Central Edinburgh (Mr. W. Graham) would like to see it doubled. I think I remember reading an article of his not very long ago in which he mentioned a sum of £150,000,000. These amounts can only come out of one pocket, and that is savings, and the more we increase our credit in that way the more difficult it is to carry out our other Government maturities.

It is really a subsidy. Some of the issues that have been made are hardly carried out in a businesslike way and hardly do credit to the Committee. Issues have been made to mines, to cottages, to docks, shipping, collieries, a foreign Government, tin, sugar, electricity in Poland, electricity in Greece, a bacon factory, quarries, brickyards, etc. The hon. Member for Finsbury spoke of the large amount which is to be guaranteed to Messrs. Pearson and Dorman Long. Well, it is a large amount, even for a big coal area. I would like to know from the Financial Secretary to the Treasury whether this is a first charge on this large property. What is the security? I rather thought that one of the troubles in all the coalfields at the present time was that there are too many coalfields, yet here we have another one being developed with Government credit, and I do indeed criticise it.

With regard to shipping and shipbuilding two years ago I had an Amendment down in regard to this subject, and possibly the Committee may remember a Resolution passed by the Shipowners' Parliamentary Committee on 20th March, 1924: It was unanimously resolved that in the opinion of this Committee, representative of the whole of the shipping industry of the United Kingdom, it is not desirable that the application of the Trade Facilities Act to shipbuilding be continued, and that therefore its continuance be not supported by the shipping industry. I wonder if the Financial Secretary took any notice of that. I do not know that he is taking very much notice of me.


I can assure my hon. Friend that he is quite mistaken.


I am very pleased to hear it. A further meeting was held on 17th December, 1925, of the Council of the Chamber of Shipping, and they suggested to the Financial Secretary that if any loan was made to shipping and shipbuilding companies, the representatives of shipping should be consulted on that particular matter. I do not know whether that has been considered, but it is a very important point. There was a further guarantee recently given to a company called the Silver Lines, and Messrs. Holt and Company wrote a letter to the "Times" showing the position and criticisms were made in reference to the Government giving credit to a company of that sort. There was an important banquet held last Friday where the right hon. Gentleman the Member for West Swansea (Mr. Runciman) became President of the Chamber of Shipping, and I am sorry he is not in his place. I was not at the banquet myself, but the speech of the right hon. Member read very well. The right hon. Gentleman the Member for West Swansea specially referred to the Trade Facilities Act, and perhaps I may be allowed to read just a few lines from his speech. He said: The Trade Facilities Act, so far as it may be effective to achieve its object, is adding to the supply of tonnage at a time when there are already far too many ships afloat. That was referred to by the hon. Member for Finchley (Mr. Gillett). The right hon. Gentleman the Member for West Swansea went on to say: The increase in the number of new vessels induced by the artificial creation of shipowners' credit delays the day when the freight market will demand more ships. In other words, for every two orders that are placed with this artificial assistance, the placing of half-a-dozen later on will be indefinitely postponed. Those are very strong words, and if true will hardly assist the unemployed in this country. I hope the Financial Secretary may see his way to discuss that matter with the right hon. Gentleman the Member for West Swansea. With regard to losses, I put down a question on 4th February, 1926, to know what the losses had been in regard to the Trade Facilities Act, and I was informed that they came to £20,510. That is not much on the total, but I feel those losses should not have been made if they had been dealt with in a businesslike way. One was a brickyard. If anything should have paid its way at this particular time I should have thought it would have been the making of bricks. There was another case of the Leckhampton quarries, and this company was guaranteed £27,500 for 25 years. On the 9th November, 1922, they received their first advance. On the 9th July, 1924, they received their second advance, and on the 29th of November, 1925, they had their third advance. I had a question down on the 24th November, 1925, in reply to which I was informed that they had failed. They may have failed before the 24th November, but, really, to advance Government credit to a company which had an advance on the 29th April, 1925, and failed in November, is hardly business. We must not bolster up firms of this sort.

There are two points which I want specially to raise. One is the necessity for protecting the taxpayer. I really cannot think that any industries require any more credit from the Government. I feel that they do not want these artificial props any longer. The Southern Railway made an issue not many months ago. They did not come to the Trade Facilities Committee, and they received their money all right. Why should not all companies go to the public on their own credit, and not on the credit of the Government? My second point is the protection of our credit, which was referred to by the hon. Member for Finsbury. This is vital. Every penny at the present time should be conserved and saved by the Government on account of the taxpayer. Cheapness of money in the next year or so is absolutely necessary. How are the Chancellor of the Exchequer and the Financial Secretary to the Treasury going to carry out the large maturities? Everyone knows what our National Debt is, but they may not know the maturities. Between 1927 and 1929 £1,000,000,000 will be maturing. This leaves out the £2,000,000,000 of 5 per cent. War Loan which the Government have the option of redeeming in 1929. If we can convert these maturities at a reduction of interest of ½ per cent., it will be a benefit to the taxpayer, but that can never be carried out if these credits and the credits which have been mentioned by the hon. Member for Finsbury are continued.

I feel that the Financial Secretary to the Treasury should look into every detail of these credits and see that these maturities, which start in February, 1927—a year hence—are carried out to the advantage of the taxpayer and of the industries of this country. I do not propose to refer to the Export Credits scheme, but, in conclusion, let me impress upon the Committee the necessity for protecting the taxpayer in an important matter of this sort. Let us see that everything is done so that these maturities may be put on a longer redemption basis and a lower rate of interest. Then we can look forward to a reduction in taxation, and a reduction in the large amount of interest payable on our National Debt. The taxpayer has undertaken an extreme amount of financial responsibility.


I will not attempt to follow the two hon. Members who have just spoken in general terms on this Financial Resolution, but I rise to ask the right hon. Gentleman a few questions with reference to the £2,000,000 guarantee to Messrs. Pearson and Dorman Long—a matter which vitally affects the mining industry generally in this country. I was rather astounded when I saw in the Press the announcement of this £2,000,000 guarantee, and I was rather taken aback by the wonderful description of this new venture. When, however, I saw edition after edition of the newspapers come out day after day, with the climax this weekend, it was forced upon me that this Press boom was not so much spontaneous as a definite financial arrangement in order to boom this guarantee. The outstanding thing to me about this business is this: I happen to know some of the people who are connected as directors with Messrs. Pearson and Dorman Long, and they are people of the most sturdy and stern individual characteristics. They are exactly where people were in the early part of the nineteenth century.

Only yesterday there appeared in one of the Northern Sunday papers the report of an interivew with a director of this company, in which he said that the Government in the present crisis cannot assist; that no Government can make trade by Act of Parliament; that industry would be better left alone; that the Government, in helping, invariably hinders. That is one of these gentlemen, a director representing this company which is asking for a guarantee of £2,000,000 by the Government to keep the company going. That is Colonel Bell, one of the directors of this company. Mark the effect. The Government may say, and the right hon. Gentleman may say, that this is only a guarantee, but the actual effect of the guarantee is worth a full two millions to this company, for we see at once that the shares of this company have leaped up. The best financial newspapers are booming it, and on every hand we read that the shares are doing very well indeed as a result of this guarantee.

What I want to ask is what are we going to get as a country for this guarantee? What is going to be the financial return? Is the country always to give a guarantee against loss and never to share any of the benefits, because that is what the guarantee amounts to? Then I particularly want to ask what conditions the Government have laid down, if any, as a result of this guarantee. Are there any conditions as to the future for the workers who are going to be engaged in Kent? Are there any conditions in relation to their housing, to their wages, to baths? Are there any conditions for joint control on the part of the workers in this particular industry? Here is a company which we are told is going to begin to operate in an area which will give coal, I understand, for centuries to come.

Indeed, we have been told in the North that it is very probable that some of the men who are employed to work this coal will come from the North of England, and one writer, I believe it was in the "Observer" yesterday, says that the people from the North of England are the descendants of men who originally came from Kent. If they are going to be brought down to this new area and engaged in coal getting, these men will come back there with the benefit of a century of experience, and as intelligent men. Are they to have any interest at all in the general control of this industry? I want the Committee to understand that this is a vital fact. This question of control is not a question merely on paper. It is a question that springs out of the very nature of the industry to-day.

There are men like some of my colleagues here, who have been on the surface, where we represented the men. "We have dealt with wages. Until about 10 years ago we could not go down the mines. Then the representatives on the surface could go down the mines. We go into the office to do business, and we are told that a seam of a mine is not paying. We have nothing to do with the financial side of the industry. We can know the scientific side of the mine and the practical side, and yet we have nothing whatever to do with the other side. We are simply helots as far as the industry is concerned. We say that in the great coalfields when the Government is guaranteeing £2,000,000, upon which the company depend for the exploitation of that coalfield, the least they can ask, if they themselves are not going to be direct partners, is that the workers shall be partners in the industry to the extent of helping to control it.

Then I ask this further question. Is there any understanding about royalties in this area? Wealth is already flowing into the pockets of some people who hardly knew they possessed the land before the coal began to be exploited. Have we to repeat the old story of the landowners simply reaping the benefit out of the men who work under hard, dirty and dangerous conditions? There are those of us on these benches who have worked as I have worked. This House may think it is a commonplace thing to be speaking against royalties. When they understand what some of us have seen they will understand exactly what we feel about these matters. I myself, and I am sure colleagues on these benches, have worked naked, with the exception of shoes and stockings. I have worked in a three-foot seam and—would the Committee believe it—the landowner has been getting more per tub on the surface than I have been getting for working under these conditions. Has that to be repeated in Kent, and has it to be repeated under conditions where the Government are actually guaranteeing, and the company is dependent upon the £2,000,000 to exploit the coal? Are we going to have the haphazard conditions prevailing in Kent that prevail up and down the country? Surely the least the Government can do is to ask, if it does not get any financial return, that the conditions of the workers are to be the best possible, and to see that if they are going to give this guarantee, the old game of plunder by means of royalties has to be stopped in the days to come.

For myself, I should put another point of view. We read in the newspapers that the beauties of Kent are going to be preserved. I hope they are. I hope they will not have any home-made mountains such as the hideous heaps we have in the North and the Midlands. I do not blame them, because of the haphazard conditions out of which it sprang in the 18th and 19th centuries, but for the greater part of my lifetime, when I walked out of the house, the first think I saw was a great ugly dump. What guarantee is there that that state of things is not going to be perpetuated in Kent? Surely the Government can have a say in a matter of that kind. I am going to vote, if my friends will follow me, against this guarantee. In different parts of the country, in Wales and in Durham, there are mines where there are good seams and there is good plant, well arranged, and yet they are closed because there is no trade for them.

11.0 P.M.

All that they are going to do is to exploit the Kentish coalfield with the prospect that, very probably, there will be hope of selling the coal in the long run. I have seen some of this coal. At least, I saw the coal mined in the Shakespeare pit many years ago. I was down the shaft, and if the rest of the Kentish coal is no better than that coal, there is not a great deal to be said for it. Under any conditions, if this House is going to give a guarantee of £2,000,000, the least it can ask is that the best possible conditions should be given for the workers, and that we should have the right to see that in a controlled industry they should use their experience and intelligence, and that the outrage of royalty should be put an end to, once and for all.


I put a few questions to the Chancellor of the Exchequer the other day in regard to this matter, to which he was good enough to reply, at some length. I hope he will forgive me and not consider me discourteous if I use his replies to one of my questions as the basis of my arguments to-night. I would draw attention to the fact that I have an Amendment on the Paper. My point last week, and again to-night, is that any further guarantees should be limited to the capital and not given to the interest. The Chancellor of the Exchequer gave me three reasons as to why he could not accept that proposition. His first reason was that the proposal was in an unusual form. I do not think that an unusual form should weigh very heavily upon the mind and conscience of my right hon. Friend. I would ask him to note, and I would call the attention of the Committee to, the Financial Resolution [Cmd. 2584]. The Resolution proposes the very thing which the Chancellor of the Exchequer says is of such an unusual form that it cannot be adopted. The Financial Resolution instructs the Advisory Committee to guarantee the payment of interest and principal or of either interest or principal. That is the very thing that I suggest might be done. The second reason which the Chancellor of the Exchequer gave was that under existing conditions the guaranteed stocks would not be a suitable investment for trustees. I would ask the Committee whether they consider seriously that any single one of these stocks is a suitable investment for trustees. In the first place, these stocks are guaranteed for a limited period. When that period has ended, either in five, 10 or 20 years, the trustee, under the law, may no longer hold them. But he possesses the stocks, so what is he to do? His only option is to realise them. It is an absolute certainty that directly the guarantee is removed from nine-tenths of these stocks they will fall in value.

The third reason given to me by the Chancellor of the Exchequer was that it was impossible to issue the stock at a reasonable price if it had this restriction upon it. I ask, why should the State take a risk that banks, financiers and speculators are not prepared to accept? I think it is fair to draw attention to those who are getting these guarantees. I will take the last White Paper, No 14, issued only the week before last. I will not mention names, because, may be, it is not fair, but the Committee will be able to look into the matter themselves, and they will see to whom I refer. One of these companies, which has received a guarantee of £85,000 with the interest for 10 years, is of a character of which we have seen many flotations during the last six months, and there is not a single case in all the cases in the last six months where the shares to-day are not at from 25 per cent. to 75 per cent. discount. Here is a company of exactly the same character receiving the guarantee. That is a speculative concern which has received a guarantee. Now I draw attention to a different type of concern, an extremely wealthy concern, a concern so wealthy that it paid 25 per cent. dividend last year. It wants money and it gets a Government guarantee of £250,000 at 4½ or 5 per cent., and it can pocket the difference between that and its dividend. Is that the purpose for which these facilities are to be established? I submit that it is not. Another gets a guarantee of £75,000. Last year that company paid 30 per cent. dividend.

Further, I submit that, seeing that all firms cannot get these guarantees granted to them, it means preferential treatment for those who are happy enough to obtain them. We are told that the losses will be small. It is very much too early in the day to judge what final results will be. We must wait a year or two to see what the losses will be on the guarantees. We are also told—and this is a point which has been, if not thrown at me, at least made a reference to me on previous occasions when I have complained about these guarantees—"How can you criticise the actions of the Advisory Board, which consists of such eminent and first-class men? "I do not dispute that description for a minute. I only suggest that they are human, and not infallible. And they have their bias. I will give an instance of their bias. It happened that I was a Member of a Private Bill Com- mittee in 1922. My hon. Friend the Member for Chester-le-Street (Mr. Lawson) was also a Member of that Committee, and there was on the Committee a Liberal Member who is not now in the House. Our Chairman was the present Under-Secretary for the Colonies.

We had before us a Bill for a hydroelectric scheme in the Highlands of Scotland, hundreds of miles away. They had not a single customer in prospect; they could not say who were to be their customers. When we came to consider the Bill we discovered that there was a proposed guarantee of £2,000,000. I raised an objection, but was told that it would not hold good—that we had to consider the Bill on its merits. The Bill was passed, and when I asked how I could stop the guarantee, I was told that it was almost impossible. Coming from the North, I did not know what "impossible" meant, and I came downstairs into this House, and within half an hour blocked the Bill which I had just passed upstairs.

It was a most extraordinary performance, and I believe caused considerable perturbation in many quarters, particularly among the promoters of the Bill. Considerable pressure was put upon me to remove my objection, but I said I would only do so if the promoters withdrew their request for the guarantee for this extremely speculative object. They would not do so, and that, to my mind, shows that they knew what a risk it was, although the scheme was backed by some of the biggest financiers in the City of London. All they wanted was to grab State money, and let the State take the risk of the undertaking. The result was that the Bill was debated on the Floor of the House. No more was heard of it or of the promoters, and the scheme has never been carried through.

I suggest that this is an opportunity to put an end to these grants, which are merely an opportunity for grab. The poor man grabs and the rich man grabs, and this is our opportunity to put an end to it. As a first step, I propose later to move as an Amendment that the grant should be limited to capital, and no longer continue in respect of interest.


I rise to protest against the favouritism shown by the Government in the administration of the Trade Facili- ties Act and the Export Credit Scheme. The right hon. Gentleman, in introducing the Resolution, laid great stress on the fact that the decisions of the Committee before whom applications go should be free from political considerations, and we on this side of the House agree that that is important so far as guarantees of this kind are concerned. The point is this. The justification for the Act was that it would help to reduce unemployment, and I want to know why it is that those engaged in the export trade with Russia are not treated in the same way as exporters to other countries. Mexico, Portugal, Rumania, Bulgaria, Estonia, and other countries have the advantages of this Act. Three years ago the right hon. Gentleman who is now President of the Board of Trade (Sir P. Cunliffe Lister) stated that the moment Russia created conditions essential to sound trade, then at that moment the export credit system would be at the disposal of all British traders who desired to trade with Russia.


On a point of Order. I do not know if the hon. Member was in his place when the Chairman gave a ruling on procedure. If the question of Russian trade is discussed now in the general Debates, will the Committee have an opportunity of discussing it again on the Amendment having particular reference to Russia?

The DEPUTY-CHAIRMAN (Captain FitzRoy)

The Amendment which deals specifically with the question of Russia is out of Order, and I should not have called it in any case.


I take it I am entitled to discuss the policy of the Government in the administration of these Acts and in order to do so I would oppose the Resolution, although, personally, I am not in favour of reducing the amount of money available for carrying on the trade of the country. At the same time we are entitled to make our protest. Since the present President of the Board of Trade made that statement three years ago, firms in this country have been engaged in trade with Russia upon a credit basis. Russia's foreign trade has grown since 1921, from £20,000,000—in the first year of the trade agreement—to £113,000,000 according to figures given in the House a few days ago. Can any Member of the Government, or any Member of the House give a single instance in this country or out of it, where the present Russian Government or any of its trading agencies, have failed to fulfil trading obligations into which they have entered? I do not believe that challenge can be accepted. If it can, I hope hon. Members opposite will produce the evidence. What is the truth about conditions in Russia to-day? Russia has stabilised her currency without outside assistance; she has balanced her budget by taxation; and internal conditions in Russia have improved tremendously during the last two or three years. Her production, both agricultural and industrial, was restored in the last completed year, to 71 per cent. of the pre-war figure, after making allowance for the succession States; the area of land under cultivation is expanding year by year; great new electric power stations are making their appearance and the electrification of the countryside is going on.


The hon. Member must not carry his argument in favour of extending these trade facilities to trade with Russia to too great lengths. It is not necessary to tell the Committee all the conditions in Russia at present.


I am endeavouring to connect my argument with an appeal to the Government to remove the restrictions which they now place on Anglo-Russian trade. I wish to show that conditions in Russia to-day are entirely different from the conditions of three or four years ago.


There are no such restrictions.


The hon. Member knows there are restrictions if he has any intelligence at all. [HON. MEMBERS: "Order!"] One restriction on the development of Anglo-Russian trade is this—that the political uncertainty created by the Government's attitude, and their refusal to clear up outstanding questions, prevent manufacturers from undertaking long term risks. [HON. MEMBERS: "What Government?"] I am speaking of the British Government, who have consistently refused to take any steps to convey to the Russian Government with what parts of the Treaty which were negotiated by Labour they disagree. In the nine months between the 1st October, 1924, and the 31st May, 1925, Russia imported 32,247 tons of agricultural machinery, of the value of approximately £2,000,000, and of that quantity only 179 tons, of approximately the value of £10,000, was imported from Great Britain. Before the war the constituency that I have the honour to represent sent anything from £600,000 to £750,000 worth of agricultural machinery every year—


I hope the hon. Member will not continue to go into too great detail in regard to Russia. It seems to me to have nothing whatever to do with this Resolution.


It has a great deal to do with this question, as I shall be able to show a little later on. As a matter of fact, the Minister of Labour is knocking men off the unemployment register in the City of Lincoln, and these men, many of them middle-aged, are looking to the industry in which they have been employed most of their lives as their only hope of getting a job. Some three months ago an agricultural engineering combine in this country was offered very consider able orders for agricultural machinery for Russia, and the firms in the City of Lincoln were offered orders that would have made a substantial diminution in the unemployment in that city. The managing director of the largest combine of agricultural machinery makers in this country stated openly a short time ago that an order for £60,000 had been missed, so far as the City of Lincoln was concerned, merely because the credit facilities that are available to other countries were not available for financing Anglo-Russian trade, and because of the political uncertainty the bankers and financiers were not able to take the ordinary trade risks that they would take in normal times.


The hon. Member has an Amendment on the Paper which has been ruled out of order, for the reason that it is not in order to move it on this particular Money Resolution. It should be in the form of an Instruction on the Bill.


Am I not in order in criticising the administration of the Government and their refusal to extend the provisions of this Act to Anglo-Russian trade?


Further, on the point of Order, I would like to submit that the Prime Minister, in 1921, in introducing the original scheme, stated definitely that the Committee was instructed to consider each application in the light of the amount of fresh employment it would bring to this country. I submit that the hon. Member for Lincoln (Mr. Taylor), in developing his argument, is seeking to show how, under this scheme, if the administration of the scheme is properly carried out, there will be a great deal of fresh employment provided for unemployed people in this country.


To a certain extent the hon. Member would be in order in pointing that out, but to deal with special cases in regard to trading with Russia would be in its proper place if it were moved as an Instruction on the Bill, but not upon this Money Resolution.


I very carefully read every word that was said in the discussion on the Financial Resolution last Session, and speaker after speaker roamed into every corner of the globe—India, Nigeria and Kenya. Is there any reason why Russia should be specially singled out as a place that is barred from discussion, other than the fact that it seems to be objectionable to certain hon. Members opposite?


Further, on the point of Order. I would like to submit there is this additional £5,000,000 to be voted here to-night, and surely this Committee is entitled to ask for some guarantee from the Minister as to whether there will be a different policy pursued in regard to Russia in connection with the various schemes which the hon. Member for Lincoln (Mr. Taylor) is trying to put before the Committee?


If the hon. Member desires to suggest that any particular country or trade should be picked out for special treatment, it must be done on the Bill, and not on this Resolution.


I submit that the hon. Member for Lincoln has not suggested this country should be picked out for special treatment, but that it should get the same treatment that other countries have been getting in the past. That, I submit, is a matter for discussion on this Resolution.


So far as I am aware, there is nothing in the Bill to prevent this being extended under the Trade Facilities Act to Russia.


May I submit that the Bill provides for a total of £75,000,000, and we have only details of guarantees amounting to £63,000,000. Is not my hon. Friend in Order in suggesting the way in which the odd £12,000,000 should be expended in the future?


I do not think he would be in Order on this Money Resolution. That would arise upon the Bill itself.


I will endeavour to put the points I still have to make as concisely as possible, but I am very anxious that the attention of the Committee and the Government should be drawn to this question, because I think it is a matter of very great importance to the future of this country, and the future of the constituency I represent. As I was saying, we recently had the opportunity of very considerable orders. I want to quote the statement, not of a Member of the Labour party, but of the managing director of Babcock & Wilcox, on the 4th January of this year: I am bound to admit that the business relations I have so far had with the Soviet Government have been satisfactory in every way, and it is difficult to believe that the prejudice generally in this country is justified by the present position whatever may be the fact of the history of the past.' I do not for a moment believe that all the fault is with the present or with previous Governments of Great Britain. But I do appeal to the Government to adopt a different attitude and outlook in regard to their economic and political relations with Russia. I wish the Prime Minister had been here, for I should have liked to question him on a quotation from a speech he made in October, 1920. It was: In my view the best thing for world trade, of which we should get our share, would be the development of Russian trade as and when it becomes possible by Germany. During the last two or three months very large orders for agricultural machinery have been placed in Germany, and the German banks have given credit terms to those manufacturing concerns—three harvests' credit. What is the position? Everybody knows that the Germans have been paying very high rates of interest for industrial capital. A short time ago we were able to see the spectacle of many good patriotic Britishers, combining patriotic fervour with push, and in the case of a loan for Germany, at 94, with 7 per cent. interest, helping to subscribe 14 times over in a few hours £5,000,000! This was not for the purpose of British industry, nor for its help; not for the purpose of helping British unemployment, but for the purpose of exploiting German labour—at a high rate of interest. I want to ask the Prime Minister, if he replies for the Government, whether or not the Government are adopting a plan, consciously and definitely, of leaving the development of the Russian market to the Germans? Is it to be the market in which the Germans will sell their surplus exports, is it the theory of the Government that we should in the long run benefit by the receipt of reparation payments from Germany? If that is being pursued as a definite policy, the sooner the British people, the wage earners in the industries affected, and capitalists and investors understand it, the better it will be for everybody concerned !

We are not asking for favoured terms for Russia. We are merely asking for fair play. It is no answer to say that during the time the Labour Government was in Office that only two applications were received and turned down. These applications were unsound financially, and ought to have been turned down by a Labour, a Tory, or any Government representing the interests of the British taxpayer. We are not asking that any unsound proportion should be entertained. We are merely asking that the advantages of these Acts should not be debarred from Anglo-Russian trade operations, and that where a firm or corporation has the opportunity of submitting a substantial contribution for the benefit of unemployment in this country it ought to be understood that the committee dealing with such an application will go into that case just as carefully and impartially as if the case was one with Portugal or any of the South American States was concerned. That is all we are asking. Applications have not been made in a concrete form, simply because firms have been definitely informal that under the Acts relating to trade facilities and overseas trading there would not be a penny for Anglo-Russian trade. That statement has been made on the floor of the House on behalf of the Government. Therefore, it is perfectly true that you have not had any considerable number of schemes relating to Anglo-Russian trade put before the Government—simply because it was known that there was no chance whatever of their being entertained. At a time when some important negotiations were going on I asked the President of the Board of Trade to receive a deputation to go into the facts, but I was met with a curt refusal. I hope hon. Members, those on the opposite side particularly, will realise that some of us who take this view have lived among a community who have suffered, as we believe, through the manner in which the problem of Anglo-Russian relations has been handled. We are not actuated by hatred towards our own country, but we see men who have been hard-working citizens without a job year after year and believe that they might have a job if this credit difficulty could be got over; and in holding that view I hope we shall be given the credit by other hon. Members for loving our own country as much as they do.


There are one or two questions that I very much want to ask the Financial Secretary to the Treasury with reference to this Trade Facilities legislation which is brought in year after year. I think it is the opinion of hon. Members on all sides of the House that it is high time a Committee of Inquiry was set up to investigate all this class of legislation. In the House last year the right hon. Gentleman the Member for Central Edinburgh (Mr. W. Graham) made a series of very cogent and forceful speeches on the subject of this trade facilities legislation, and in every speech he appealed to the Government to set up a Committee of Inquiry, declaring that it was overdue. I must confess that I cannot understand why the Government have not set up such a Committee during the past year. Instead, they come down to the House again to ask for the usual £5,000,000 additional credit. I hope they will set up a Committee before they come to the House next year, because there are many questions connected with this legislation which require the closest scrutiny. If the scheme is of great value in relieving unemployment, why do the Government ask only for £75,000,000? What induced anybody to fix that particular figure? If the scheme is of great value they might well ask for £200,000,000, or £300,000,000.

Last year a great deal was said about the effect upon the national credit of this particular class of legislation. I do not think any grave charge can be made against this legislation on the ground that it seriously affects our national credit. Our credit is good. The national credit is based primarily upon the taxable capacity of the community, and if this legislation really does what its authors claim for it, and increases production, it increases the taxable capacity of the community, and in that way it ought to increase our credit. I do not think any strong case can be made out on that score. On the other hand, a very strong case can be formulated against the whole of this Trade Facilities legislation on the ground that it provides cheap capital for one industry primarily at the expense of other industries. That particularly applies to the smaller industries of the country. There are certain industries in which the granting or withholding of credits under this scheme means the difference between their continuing to exist and collapsing altogether. I think that any industry, especially in the smaller lines, has a justifiable ground for complaint if a particular rival, for no apparent reason, obtains this credit and is thus enabled to cut out the small industry which has not got this credit causing the latter to go out of business altogether. On these grounds alone a good case can be made out against this class of legislation and the Government should consider seriously the question of the extension of this legislation to smaller industries.

There is another obvious defect, and it is that a contingent liability of £75,000,000 sterling is created for the taxpayers without any specific asset whatever. I think the taxpayers are quite justified in seriously questioning this kind of business. I know it is good so far as it stimulates production but it is invidious in regard to one small industry as against another and there should be a Committee of business and financial aspects or a Royal Crown to investigate the whole of this class of legislation. With regard to these credits the bankers are in a much better position to grant loans, because they have branches right throughout the country with a local branch manager in every town who knows every merchant on the country-side and for these reasons it would be better to leave the great branches to run the credits granted to the small trader. Then we have also to consider the heavy industries, because they have gone through a desperate time and they will require a great deal of reorganisation in the course of the next four or five years and all the factories will have to be remodelled and extended out into the country and the whole production will have to be specialised with more co-operation.

I do not want to trespass on the delicate ground of the coal industry, but it is obvious that whatever the Commission may recommend a large number of men in the coal industry will have to be transferred from one district to another, from pits which are not work able at a profit to new fields and for that a good deal of capital will be required. I think a strong case can be made out for granting some form of credit to this large industry. The right hon. Gentleman the Member for Norwich (Mr. Hilton Young) has stated that he believes confidence is a very good psychological factor in stimulating industrial revival, and if the Government could put the whole credit of the State behind the heavy industries it might have that psychological effect upon the future of the heavy industries. Therefore I appeal to the Government to set up an appropriate committee to investigate the whole question of this trade facilities legislation with particular regard to the heavy industries as opposed to the small industries. Such a committee should consider, first of all, the direction in which State credit should be applied if applied at all; and secondly whether any security should be required for the taxpayer and if so what form it should take, I think the senior Member for the City of London effectively disposed of the idea of appointing Government directors. The suggestion was made that the Government should appoint directors in all these big industries. I am aware that the late Lord Milner in a well-known book he wrote put forward the view that we might very well demand a certain number of deferred shares on behalf of the taxpayers. I do not express any opinion as to the merits or demerits of any scheme, but a committee of enquiry might profitably examine the whole business.

May I say a word on behalf of my constituents, directed particularly to the Secretary of Oversea Trade Department. I do not express any opinion as to whether the export credits scheme should be extended to Russia or not, but I think it is high time the Government made a definite statement with regard to the whole trade position with Russia. If we have a trading agreement with Russia, why should not we apply the export credits scheme? As far as I can see, it should not affect the general political relationship between this country and Russia at all. I am not at all convinced that the application of the export credits scheme to Russia would benefically affect the herring trade, because I believe Russia has sub-statistical credits in this country already into which she can dip, but I should like a statement from the Parliamentary Secretary as to the whole of this question, because the whole of the North East coast of Scotland is in a roar of protest with regard to this refusal of the Government to extend the export credits scheme. Rightly or wrongly, the herring trade thinks it is being missed by the refusal of the Government to do this, and if the Government are going to continue to refuse to extend the export credits scheme to Russia, they should say first of all whether in their opinion it would seriously affect the position of the herring industry, and in the second place, what is the reason they put forward for refusing to extend the scheme. I only ask for information. I do not intend to express my opinion.


An hon. Member a few moments ago based his opposition to this proposal on what he said was the fact that this kind of legislation is introduced to deal with matters of a temporary character. He further said he thought the time for these temporary measures had passed. I do not think so, and I do not think it will ever pass while we have a million and a third people unemployed. The Parliamentary Secretary tells us that the doling out of national moneys is left to a Committee of three. The sums we are asked to Vote are fairly formidable sums, and we ought to be allowed to say something with regard to the purposes to which they are said to be devoted. Attention has been called to the fact that some of this money has been used for the purpose of building ships, where there are already too many ships, and the present proposal is that some of the money shall be devoted to the winning of coal when we do not know what to do with the coal we are now producing. It is with regard to that aspect of the question that I want to say a word or two. We have a right to expect that this Advisory Committee of three know their business. We have no right to question their probity, but whoever they are, and whatever their qualifications, they cannot be expected to know the whole ramifications of industry throughout the length and breadth of the land. One seriously wonders whether they have taken into consideration the possibility of the guarantor, the State, being called upon to find the money. So far as Kent is concerned, the newspapers in the last fortnight have painted some very rosy pictures indeed. When you turn to the financial aspect of the question there is nothing to justify the painting of this picture. I have been sufficiently curious to-day to take out the figures relative to the Kent coal field for the period since the introduction of the National Wages Agreement of 1921. Since that time there have been eighteen quarterly ascertainments taken out in the County of Kent, and, of these, thirteen have shown losses, and considerable losses. It is true that five of them showed profits, but when the profits which have been made in the coalfield are deducted from the losses there is still a net loss on coal production in that county, during the last three and a half years, of £109,000.

I believe it is true to say that there has been expended in that county hitherto about £3,500,000, upon which not a farthing of dividend has yet been paid. The figures which I have just recited take no cognizance whatever of interest on capital or even of amortisation. If amortisation charges were added to the figures, the loss, in the County in comparison with its output, would be huge indeed. If money is to be dealt out of the national purse for the purpose of rehabilitating the coal industry, I want to suggest that this House ought first to be given a chance of saying where that money should be directed, and I feel sure, if this House were given that chance, it would not say that the money could best be spent in Kent, because in that County, three and a half millions of money have already gone without the output reaching 500,000 tons per annum. In Nottinghamshire, we have had in the last twenty years, a cost of less than £400,000, and the present rate of output is in excess of one million tons per annum. We could still do with thousands more men as coal producers, if we had anywhere to house them. Only last Saturday we had an application from a colliery company for three hundred men, for whom work was ready, but there was nowhere to house them. If money is to be spent and dealt out to the coal-mining companies, I want to suggest it should be given to those areas where it can best be applied in the national interest.

There is another espect of this question which causes me considerable disquiet, and it is this. The Government appointed a Commission to inquire into the whole ramifications of the coal industry and to deal, for anything we know to the contrary, with the state of the organisation of the industry and to deal with the system under which it is to be carried on in the future. For good or for ill there have been placed before that Commission the reasons why the industry should pass into national control, and the action of this Committee in suggesting that two millions of money should be placed into the hands of private interests is in a measure interfering with the pre-judgment of that Commission which is now sitting. I think it is perfectly scandalous that this should have taken place at this particular time, and I would ask the Financial Secretary if it is not possible for him to get his; Vote to-night and remove therefrom this particular item. I feel sure that it would give general satisfaction to the House if the Government would have, as well as the business efficiency, the political decency to wait until the Commission has reported before they commit themselves to what seems to me to be a policy of carrying coals to Newcastle.


I have only a few words to say on this subject. I am one of those who believe that when this legislation was first introduced it served a very useful purpose, but I am inclined to think that I rather sympathise with the view at the present time of my hon. Friend the Member for Ilford (Sir F. Wise) who appeared to doubt whether it any longer did serve a useful purpose. I feel perfectly certain of this, that if it is to serve a useful purpose in the future the whole machinery in regard to it must be considerably tightened up, because I cannot help thinking that a position has been reached in which I am almost inclined to say Government facilities are being exploited for purposes for which they were never intended. I want to ask the Financial Secretary to give special attention to one aspect of the case which has come before me in a particular instance during the last few months. A number of these guarantees have been given to companies for the purpose of the construction of some particular machinery or the production of some particular goods, for which they had to spend large sums in what was to them raw material. There have been cases in which that raw material, which was purchased with the money so guaranteed by the Government, could have been purchased in this country—British-made goods—on quite as good terms as from foreign manufacturers, but the fact is that companies which have received these guarantees from the Government have purchased those manufactured or semi-manufactured articles from foreign firms. They have purchased articles produced by foreign labour when, with a little more pressure from the Government, they could have been obliged to purchase those goods from English manufacturers, and thus definitely to have increased employment in this country. In a particular case which I have in mind at the moment, I believe that, after considerable pressure had been brought to bear on the company in question, they did, if I may say so, somewhat reform their methods. It seems to me, however, to be perfectly clear that, unless the whole machinery is tightened up very considerably, the benefit which these facilities can give in reducing unemployment will be lost.

There is only one other point that I want to make, and that is as to the risk to the taxpayer from these guarantees. It is said that the loss has been small, and I do not question the figures which have been given; but how can you tell what is going to be the loss on a guarantee until the guarantee comes to an end? My hon. Friend the Member for Ilford (Sir F. Wise) quoted a case where a guarantee was given just a very short time before the company failed. I do not know what security the Government have to sec against that guarantee, but my hon. Friend, I think, omitted to note that the advance which was made to that company only just before it failed made up a total advance to that company of £100,000, instead of only £23,000, which I think my hon. Friend mentioned. I should like to know, in a case of that sort, what security there is. There are other guarantees outstanding, which may be prolonged even beyond the original period. What certainty has the taxpayer that the money thus guaranteed will be paid off without loss to the Treasury? I think there are two outstanding reasons why the whole of this machinery should be re-examined very carefully. One is the interest of the taxpayer, and the other is the very considerable doubt which some of us have as to whether this machinery is being used in the way in which it might best be used for the increase of employment in this country.

12.0 M.


I think the Financial Secretary did not feel altogether comfortable when he was introducing this Financial Resolution, and, after the reception it has had from all quarters of the Committee, I can understand the somewhat halting terms in which the right hon. Gentleman introduced it. It is in the recollection of some hon. Members that when this legislation was introduced, there was a very pressing unemployment problem, and this Measure was put forward on the assumption that this problem on the big scale that existed at that time was a temporary phase, due to various disturbances such as the position of the exchanges and the generally disturbed condition of European affairs. In the minds of the promoters of the Measure, and in the minds of the Members of this House, it would appear from my reading of the discussion that took place that it was quite clear that they contemplated a revival of prosperity and an increase of trade, and that this was simply a temporary Measure which was going to help for a short time in setting going again the wheels of industry.

The Prime Minister at that time, the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) when he was outlining his proposals, said: This country, I believe, has probably touched the bottom in regard to its trade. That sentence in itself illustrates the point, that in the mind of the Government the position of things in the country was unprecedented and that a temporary Measure such as this might give an impetus which would result in a revival of prosperity. But on various occasions in the House since then the right hon. Gentleman has taken a different view. I think we all realise to-day that the problem of unemployment is not going to be solved by any extension of this Trade Facilities legislation, at least on anything like the lines on which it has so far been run. I can conceive of it being remodelled and made a very useful piece of machinery, but as it stands I think there are many hon. Members who are disposed to press upon the Government the winding up of this legislation. I was greatly struck by the speech of one hon. Member opposite, who spoke in such unmeasured terms of the way in which this scheme was being worked at the present time. We are now in the position that certain interests are exploiting the problem of the unemployed in order to forward through their own particular interests and not the interest of the unemployed, which was the predominating interest at the initiation of the scheme. I suggest to the the Financial Secretary to the Treasury that, owing to what has been said tonight from hon. Members in all parts of the House, it would be very advantageous for the Committee if he would issue again a statement of the grants that have been made under the Trade Facilities Act. He may tell me that I can get it at the Vote Office. No doubt, I could, with some difficulty. In making inquiry at the Vote Office one only gets the arrangements for the preceding year. For the earlier years one has to go to the Library and dig out the information.

In view of the general feeling of un-settlement with regard to this legislation it would be in the interests of the scheme and of sound government if the Minister acceded to our request and issued a statement of all the companies which have received grants from the beginning, together with a tabular statement showing the different branches of industry which have shared in the benefits. The right hon. Member for Carnarvon Boroughs, in outlining the proposals of the scheme, spoke enthusiastically about railway extensions and electrifications, of waterways and all the improvements that were to result from the scheme. It is true that money has been devoted to electrification, but I would like to know how much of it has been spent in this country and how much elsewhere. I notice that about £2,000,000 has been devoted to setting up an electric tramway scheme in Athens. Athens is a historic city and has wonderful traditions which may appeal to a die-hard Tory mind. It has traditions which may also appeal to many of us who realise how much we owe to Greek thought. But at the same time while we have this respect for the past, we feel that this money might have been much better spent at home, and that the traffic problem of London, for instance, might have called for some expenditure. I know that the Minister may tell me that this Athens scheme was a sound investment and that the Advisory Committee would not have proposed it unless it had been sound. If it were sound why did it come under this scheme at all? There is the element of a gamble. It would have been to the advantage of this country if the asset that was being created had been created in this country instead of being at the mercy, possibly, of a Bolshevik revolutionary in Greece.

In the allocation of money under the Act I notice that grants have gone to the sugar beet factories. I see that our friend Lord Weir has been on very favourable terms with the Committee in connection with this matter. I find that there was allocated to the Anglo-Scottish Sugar Beet Company some £300,000, and that a second Anglo-Scottish Sugar Beet Company got £850,000. We have this position: that we are not only supplying a subsidy to this business but that the State is practically putting down the capital also. It it is a success then Lord Weir and his friends who have come into it will walk off with the asset which is created; if it is a failure then the right hon. Gentleman and his colleague the Chancellor of the Exchequer, or as I hope the successors of these two gentlemen, will have to deal with the situation.

Let me say a word about Russia. It is interesting on going back to the beginning of this scheme to find that the Russian question came up when the scheme was set on foot. Members on these benches pressed the case for Russia then. My friend Mr. Waterson asked whether they were to understand that Russia was not to be considered and the Chancellor of the Exchequer, the right hon. Gentleman the Member for Hillhead (Sir R. Horne) gave a definite assurance that "Russia is within the ambit of this Scheme." I put it to the Government that when that was said, when that pledge was given, Labour Members expected that it would be worth something and that full consideration would be given to the case of Russia. We do not want the Government or the Advisory Committee to give trade facilities to the case of Russia which are not good business. We only ask that the prejudice in the minds of some Members of the House should be removed, and in order to encourage them to get rid of this prejudice let me refer them to a speech made by the present Chancellor of the Duchy of Lancaster (Viscount Cecil of Chelwood) when dealing with the question of Russia at that time. He made a very striking speech and referred to the fact that there were certain people who immediately saw horrid visions whenever Bolshevism was mentioned. In view of the possibilities of this trade I ask the Government to give some sympathetic consideration to its development.

I also want to appeal to the Secretary to the Department of Overseas Trade in connection with the herring fishery. I agree with what has been said by the hon. Member for East Aberdeen (Mr. Boothby). There is a great amount of discontent in Scotland with regard to this matter, and it is important everything should be done that can be done to help these people in the present difficult circumstances. If I am not able to persuade the Financial Secretary to the Treasury I am sure that the additional eloquence of the Secretary to the Overseas Trade Department would produce some effect. There is a great deal to be said for the position he took up in 1921, when he conceived that a good deal could be done to encourage these fishermen under the Trade Facilities Act. I would remind the Committee of what he said in connection with this matter during the Second Reading Debate on the Trade Facilities Bill: The object of this Bill is to get manufactured goods made in this country by our people and exported, and not to give opportunities to people in other countries to manufacture goods with the aid of our credit. There is another point which seems to me to be Germane to this statement in the Bill as to manufactured goods. The greater portion of our trade with Russia before the War was in two things—coal and herrings. The herring is the product of our shores, and, before the War, we exported something like £4,000,000 worth of herrings to Russia and Northern Europe, our annual total exports of herrings being £5,500,000–3,000,000 fish. They went through Lubeck, Hamburg, Riga, Memel, Danzig and St. Petersburg, and filtered down through Russia, Poland and the Balkan States to Turkey and the Levant. This is the point which brings it under the Trade Facilities section of thescheme:— The herring represents mostly labour, and herring in barrels, smoked or salted, is a manufactured article. I am not a Member for a Scottish constituency, but I wish some of the Scottish Members were here to back me up. I think that under this Bill it is worth urging the point that the herring in its salted state should come within this description of a manufactured article. It is of the utmost importance that we should keep the herring fishery going for more reasons than one, quite apart from the unemployment question. The herring fishery is the nursery of the Navy, and the herring fishers are thus the bulwark of this nation. In sending out the herring under this Bill, if they ask for credit—as they were, not under this Bill but on other grounds, some while ago—we are sending out labour in its best form. There is no money needed for raw material; nearly the whole cost of the herring trade lies in the labour of our own people. Therefore, before it is too late, I would put in a good word for the herring fishery under the description of an article manufactured in the United Kingdom, as provided by the Bill in Clause I."—[OFFICIAL REPORT, 25th October, 1921, col. 751, Vol. 147.] As a result of that eloquent appeal made by the colleague of the Financial Secretary, I hope that we in Scotland may look for some change in the attitude of the Government, and that something will be done.


May I ask the hon. Member if an application has been made and refused for aid to the herring export trade?


I think the Secretary to the Overseas Trade Department would be cognisant of the fact of any application that was made, when he was making that speech. Another point I wish to raise is that of the constitution of the Advisory Committee. There are three people who are concerned in this matter. The former Chancellor of the Exchequer, the right hon. Gentleman the Member for Hillhead, when he was taking the House into his confidence with regard to this Committee, suggested a reason why the subject should not lie within the province of a Government Department. He said: The House will readily appreciate that it would be impossible for any Government Department or any political body, or any Committee which was supposed to have any political predilection whatsoever, to be subject to the influences which might be brought to bear. You must put such a matter in the hands of a Committee which will be free and untrammelled.—[OFFICIAL REPORT, 25th October, 1921, col. 659, Vol. 147.] The right hon. Gentleman the Member for Hillhead is not now in the Government, but the Under-Secretary for the Colonies, in the present Government, in those days was not in office, and he took a very different view from that of the right hon. Gentleman who has since been relegated to the back benches, for, on the 19th October, we find that his view of the Committee was as follows: The Prime Minister said that the £25,000,000 would be spread out among the firms of the country by a committee of high and eminent financial and commercial authorities. I mistrust high and eminent financial and commercial authorities …. I say that that £25,000,000 should be at the disposal of the President of the Board of Trade and of nobody else—not a committee of business men."—[OFFICIAL REPORT, 19th October, 1921; col. 153, Vol. 147.] I submit that, seeing we have Members of the Government who also are in agreement with us on this matter, the Financial Secretary to the Treasury might reconsider altogether the constitution of this Committee. Let us have a bigger Committee, and let us have more interests represented on it. The last thing that I want to say is, that it seems to me that it is a very pitiful matter that the sufferings of the unemployed and the solution of the poverty problem of the people should be taken as the reason for the maintenance of this Committee if the Minister is unable to show that it is really effecting a useful purpose in that connec- tion, and if the main advantages of it are going to certain particular interests other than the unemployed. Consequently, I would urge upon the Government that this should be the last time that they should come for an extension of this legislation, and that, instead, they should offer us something much bigger. Here we are creating assets as a result of the social credit. These assets are being handed over to particular individuals, to people who maintain that private enterprise is able to carry on without any support from any Government and without any interference from any Government. It is a most humiliating position for any Minister with the reputation and past record of the present Minister to have to defend such a policy as this, and I hope that we are going to get some assurance from the Government that we are going to have an inquiry into the whole business. If we are going to use social credit, and create assets by the use of it, let those assets belong to the community who supply the credit. When the scheme was introduced, I think, it was in the mind of the Prime Minister of that day that the local authorities should embark on one sort of scheme or another, and that there should be assets created within the country, which should belong to the community, but at the present time this scheme is nothing more than a robbery of the whole community, and that, on the plea that it is doing something to help the unemployed.


Hon. Members will remember that the right hon. Member for Central Edinburgh (Mr. W. Graham) suggested that we should begin by having a general discussion, and that then we should go on to the Amendments. As we have not yet reached the Amendments, and it is half-past twelve, perhaps the Committee will think it convenient that I should now reply to the points already raised, and that then we might discuss the Amendments.


Do I understand that we are to be confined to the reply of the right hon. Gentleman? There are many questions that we want to raise. I have been listening for hours, and have not yet had a statement from the Minister in regard to the items in which I am interested, and I protest if I am not to have an opportunity of putting him a series of questions.


I have neither the power nor the wish to cut out the hon. Member or any other hon. Member. I am merely making a suggestion for the convenience of hon. Members, and it is for them to accept or reject that suggestion.


On a point of Order. May I ask the Prime Minister if he seriously proposes to go ahead with the whole of this Financial Resolution, Amendments, and everything else tonight? I put it to him that it is scarcely treating the subject with the importance that it deserves, and I certainly think it is unfair to the Financial Secretary to the Treasury, who has had a heavy day already.

The PRIME MINISTER (Mr. Baldwin)

I made a statement to the Leader of the Opposition after questions to the effect that we should take these two Motions, and he raised no question about it.


On that point I should have imagined that when the Prime Minister made that statement, and the whole House accepted it as being a reasonable day's business, he did not anticipate that the Financial Resolution for the Ulster unemployment grant would occupy the time that it did, and surely he is not going to ask the Committee to pass a £75,000,000 grant at this hour of the night.


£5,000,000, not £75,000,000.


This is a little irregular. The right hon. Member for the Canterbury Division of Kent (Mr. R. McNeill) was in possession.


It was in his interest that I was raising the question!


If I were to make a general survey of the Debate which has taken place up to the present, I would say that the criticisms and comments that have been passed so far have fallen into two categories. There has been a good deal of criticism of individual schemes which have been guaranteed under the Trade Facilities Act, and some suggestions with regard to schemes that ought or ought not to be favoured with a guarantee, and, on the other hand, there has been quite a different category altogether. Several of the speeches that have been made have really either attacked the whole principle of this scheme of guarantees, or at all events have suggested that the time has now come to amend it. I would like to say a word or two, first, about one or two of the more particular criticisms that have been made, and then something about the general criticisms.

I must refer to one or two speeches which have been occupied about trade with Russia. The hon. Member for Camlachie (Mr. Stephen) has referred to that matter. He has linked it up, as my hon. Friend the Member for East Aberdeen (Mr. Boothby) has done with the question of herrings. The hon Member for Lincoln (Mr. Taylor) dealt with it in much more general terms. I am only speaking as regards the Trade Facilities Act.

The hon. Member for Camlachie referred to a statement made by the Chancellor of the Exchequer in 1921, the right hon. Member for Hillhead (Sir E. Horne), when he said Russia would be within the ambit of this legislation, and the hon. Member suggested, with some indignation, that that pledge had been departed from. It never has been departed from. Russia is within the ambit of the Trade Facilities Act. As a matter of fact, applications for trade with Russia have been received and have been considered by the Committee and have been rejected by the Committee, not on the ground that Russia rather than any other country had made the application but on grounds of security, which would have been equally valid if the geographical area had been quite different. Secondly, so far as Russia is concerned—I am not speaking with regard to overseas trade but with regard to the Trade Facilities Act—it has always been open to give guarantees for trade with Russia and it is now open if the Advisory Committee in their discretion, think that the business proposition is such as can be legitimately guaranteed.

Another hon. Member asked why no business had been done in regard to trade with India. The suggestion of trade with India has my sympathy, but the answer is simple. There has been no sort of embargo upon business and trade with India but there, again, we are only limited by the applications which are made. Business to the value of two millions has been guaranteed with India and if applications had been made for equally good business, equally well secured, to double that amount, I have very little doubt the Committee would have recommended guarantees on the applications, and we should have had much larger figures shown with regard to trade with India.

I want to say generally, as I did at the outset of the Debate, that I am not called upon to deal seriatim with the criticisms of the different schemes or suggestions made with regard to other schemes than those under the Trade Facilities Act. It is not the purpose of the Treasury to upset the functions of the Committee. I repeat that I do not think there has been serious criticism from any quarter of the House. It is obviously desirable that a matter of this sort, however much it comes within criticism, should be judged impartially and by a non-political body. But there is a larger question as regards whether this legislation should be continued or not. Some hon. Members took the line that this legislation is very valuable under certain circumstances but that it had outgrown its usefulness. I want to refer to the last point raised by the hon. Member for Ilford (Sir F. Wise), namely, that of the coal development in Kent. The hon. Member for Mansfield (Mr. Varley) made an appeal to me to take that item out of the Resolution. The hon. Member for Ilford inquired whether there was any security for it and the hon. Member for East Aberdeen—who was speaking more generally and not confining himself to any particular item—questioned the security which the taxpayer has for all these guarantees. I want to tell the hon. Member for Ilford that, as far as this particular item is concerned, I think it good for a guarantee of two millions because it is a first charge on all the assets. Speaking generally, in every case the Committee—a sound business Committee, sometimes criticised on the ground that they are too narrowly a business committee—sanction the guarantee of a loan when there is good security for the advance.


What security would there be for developing a coalfield in Kent if it failed to produce coal?


The assets represent probably many millions of coal.


If the assets are there.


The hon. Member for Camlachie expressed the hope that this might be the last time the House might be asked to continue the Trade Facilities Act.


On the present lines.


I thought the hon. Member was addressing himself to the probability or possibility of withdrawing the two millions from the general resolution. It is not the Treasury's business to withdraw or assent to items, but even if it did rest with the Treasury to do so, I have not heard any reason for doing so.


When the Chancellor of the Exchequer gave an undertaking to Lord Banbury, as he is now, that the Treasury would always be responsible for the actions of the Committee, was that not meant? He gave this undertaking when the Bill was first introduced.


That is perfectly true. I accept Parliamentary responsibility, for the Treasury is responsible to Parliament for the Committee, but it is quite a different thing to interfere with the Committee's decisions. I do not mind saying that I share personally the hope of the hon. Member for Camlachie that it may not be necessary to renew this legislation again on these lines. I will go further, I never have been since 1921, an enthusiastic admirer of it. I remember perfectly well, as many hon. Members do, when it was first introduced in this House, the glowing speech of the Prime Minister of the day, the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George), under whose spell we all were at that time, no one more so than myself. However, that is past. The money was to be used for constructive measures in view, and I do not go back in the least upon the conviction I had at that time and under the conditions then prevailing, that it really was a very necessary measure. Unemployment at the present time is bad enough, it was more appalling then. A great many things were then being done which anybody who had old-fashioned economic ideas must have thought unsound. Many things we did then were uneconomic and this was one of them. Nothing, for instance, was more unsound than the Rent Restrictions Act. But these measures, under the cares of the post-War period and all the problems we had to deal with then, were inevitable. I think we are right in renewing this Act. At this moment unemployment, although improving to some extent, has not yet improved enough to be a certain indication with regard to the future. I earnestly hope, but I do not express any confidence, that within a short period—perhaps the next year or the year after, or within a reasonable time—we shall be able to dispense with this unsound legislation. That being so, I acknowledge that this is a hand-to-mouth method. It has done good. It has been of substantial benefit and promoted employment. I believe it will continue to do so, but I believe it does harm in other directions. All unsound legislation must do that. It is a question whether the advantages or disadvantages outweigh one another. In the conditions still prevailing, the advantages in the direction of the removal of unemployment outweigh the disadvantages, although I am very conscious of the disadvantages.


I wished to make some observations upon the general issue, but I was not successful in catching your eye, Mr. Hope before the Financial Secretary spoke. I will, therefore, confine myself to a question which is important not only to my own constituency but to my own country—for the fishing industry is more important to Scotland than to any other country in Europe. I was interested in the extract from the speech of the Parliamentary Secretary to the Overseas Trade Department quoted by my hon. and learned Friend above the Gangway. It must have been pathetic to listen to that appeal, made then from the back benches by the Parliamentary Secretary which was so little supported on that occasion. How different is the position to-day, when the Parliamentary Secretary for the Overseas Trade Department occupies a position of authority and influence upon the Government bench and when he is supported by a phalanx of Scottish Members who were absent on that occasion. Now he has the opportunity—and he will have the support of Scottish Members of all parties—of putting into effect a scheme the advantages of which he so admirably described. He knows the importance of this industry to Scotland. He knows that 70,000 men and women are employed and that the herring fishing industry—


Has any application been made on behalf of the fishing industry?


Oh, yes. Under the Overseas Credits Act applications are allowed to be made in respect of any industry. But my constituents are directly interested in the export trade, only in so far as it affects the herring fishing and the Russian market. Under the Resolution, if passed as it stands at present, and without a declaration from the Parliamentary Secretary that it will be extended to Russia, my constituents will incur the risks to which taxpayers are exposed without receiving any of the benefit which would accrue if the export scheme were extended to Russia. The herring fishing industry is the backbone of the fishing industry in Scotland. No less than 75 per cent. of the catch is cured and exported to Germany and Russia. The Russian market is lost at a time when, as a matter of fact, last summer we made good catches in Scotland and Yarmouth. There was a glut of herrings because the fish curers could not get rid of the fish at profitable prices. There is most urgent need of facilities being afforded for recovering the markets we have lost in Russia.


Is there anything to prevent the scheme operating under the present Act?


Yes. Under the Act at present we are not allowed to apply for export credit in respect of exports to Russia, but we are allowed to apply in respect of Ecuador, Uruguay, Mexico or any other country in the world. We are not allowed to apply in respect of exports to Russia, and that is the one country in the world, apart from Germany, that is really of urgent and substantial importance to this great industry which plays so great a part in the economic life of Scotland. Members for Scottish constituencies regret that an opportunity to put the matter right was missed in 1924. I warned the Socialist Government in March, 1924, that they should not be involved in long, complicated, political and economic negotiations with Russia without taking steps to extend the exports credits scheme to Russia, a small, modest, simple matter which would have been of substantial assistance to the industries of this country. That remains one of the most serious grounds of criticism of the Socialist admistration of that day. [HON. MEMBERS: "Hear, hear!"]

The present Government and hon. Members opposite have nothing to cheer unless the Parliamentary Secretary to the Overseas Trade Department will get up and stand by his declaration of three or four years ago, and that is an action which we Scottish Members are united in calling upon him to take. As a matter of fact it has nothing to do with the recognition of Russia; it does not require another trade agreement or anything of that kind. The Norwegian Government have taken action to finance the export of herrings without any question of recognition entering into it at all, and what the Norwegian Government can do for their herring fishery, surely the present Government can do for the herring fishery of Scotland.

Mr. A. M. SAMUEL (Secretary, Overseas Trade Department)

I well remember making some years ago the appeal quoted by the hon. Member for Camlachie (Mr. Stephen) from a place not very far from where the hon. Baronet who has just spoken now sits. What I did was to ask that my right hon. and gallant Friend, the senior Member for Norwich (Mr. Hilton Young), who was then Financial Secretary to the Treasury, should allow exporters to include herrings in the advantages under the Export Credits Scheme. I pointed out that a large-export of herrings in various forms went to Russia, but I never asked for facilities for Russia. I knew then, and I know now, that much of the exports of herrings went to German ports and Baltic ports and ports which are no longer in Russia, and were re-exported from non-Russian ports into Russia. I adhere to what I said then, and it must not be inferred that I asked that Russia should be included in the Exports Credit Scheme. To lose money with a customer once is a disaster; to lose it with the same customer a second time is a stupidity. We have had one lesson.


Is the hon. Gentleman aware that there are consider- able exports of herrings to-day from the co-operative organisations to Russia, and that not a single bill has failed to be met on the day it was due?


That may be so. The wholesale co-operators said in one of the papers that they had granted certain people in Wales a large amount of credit in strike times, but had not got a penny back. In regard to Russia they have been more lucky; it does not follow that the Export Credits Department would be equally fortunate.


That is a red herring.


So far as I am advised by the Export Credits Advisory Committee—


Who advised you?


The gentlemen who advised me, if the hon. Member presses the point, are members of an Advisory Committee, who know more about—


Herrings than you do.


—as much about the business of credit, and who shall be trusted, than probably any persons in this country. They are managers of the great banks, of the great discount houses, merchant bankers, all well-known and trusted people whose advice it is as well to take. They advised us that it is not safe to lend the taxpayers' credit to Russian trade at the present moment.

But may I bring the Committee back to this point? Why do the hon. Members for Lincoln (Mr. Taylor), Camlachie and East Aberdeen (Mr. Boothby) make such a point of asking credit for Russia? Is Russia short of credit?


Short of herrings.


She can get ploughs and herrings if she wishes, and she can pay for them, she already has the credit. Sellers do not need to come to the Export Credit Department in order to sell agricultural implements or herrings to Russia and that is what hon. Members opposite will not realise for a moment. I find that Russia exported to Britain in 1924 a total of £20,000,000 sterling, and bought from Britain £11,000,000 sterling. Therefore she bad a full credit here of £9,000,000 in 1924.


Can the hon. Gentleman tell us what became of that unexpended credit?


Does the hon. Gentleman seriously suggest that the trade with Russia would not be of much greater magnitude if Russia had greater credit facilities in London?


Let us get down to bed rock. I am not going to be deflected from my point. The export of Russian goods to the United Kingdom in 1924 were £20,000,000 sterling, and Russia took from us £11,000,000 sterling. She therefore had £9,000,000 credit with us. In 1925 Russia sent to the United Kingdom £25,000,000 odd sterling, and they took from us £19,000,000 sterling, leaving themselves in credit with us £6,000,000 sterling. Therefore, in the two years they had £15,000,000 sterling at their disposal. That money was enough to buy all the herrings in the world and much agricultural machinery. What have they done with that money? Instead of buying our Scottish herrings or Lincolnshire agricultural implements they probably used that money or credit to buy goods from other countries, and the taxpayers in Britain are now asked to come along and lend Russia their credit in order to set free that Russian credit on their exports to us to buy more goods from our competitors. Do hon. Members realise the humour of that situation after the speech of the hon. Member for Lincoln?


On a point of Order. Is it not a fact that all bills guaranteed under the Overseas Trade Act are for trade done between nationals of this country and—


That is not a point of Order.


But the Minister has given way to the hon. Gentleman.


The point the hon. Member raises has nothing to do with this case. I made a definite statement that in two years there was £15,000,000 sterling to the credit of the Russian Government. Let the Russian Government use that credit to buy British herrings and ploughs with. I will not say it has been used for matters such as propaganda. I will concede everything. But why do the Russians not use it at Lincoln instead of coming whining to the British taxpayer to find Russia further credit so that Russia can use the £15,000,000, if not for propaganda, to buy boots and ploughs in America and Germany? That is the case in a nutshell.


The hon. Gentleman said a minute ago that this balance was here in this country, and then in his next sentence he said it was not in this country but had been sent to America.

1.0 A.M.


It is hard work arguing these very intricate economic questions with the Labour party because few of them have ever been in the export business and do not understand the points by personal experience.


Does not the hon. Gentleman appreciate that it is precisely the people who are in this business day in and day out who are asking for these credits?


Do not be insulting; do not be nasty; do not be rude—give civility!


I must ask the hon. Member for Gorbals to cease interrupting.


It has been complained that the Russian Government would have bought a great deal more British goods if they had credits. Here, again, is the same reply, they could have used their owncredit. But what is their own credit worth? There is a case of a person, I am informed, who has recently sold to the Russian Government, say, £100 worth of goods on a three months' bill. The person who sold these goods to Russia has sold them without any confidence in getting the money at the end of three months, and is paying 6 per cent. for three months to insure that £100. That is at the rate of 24 per cent. for the year. In other words, the British seller puts so little faith in Russian Government credit over a period of one year that he is willing to surrender £1 out of every £4 due to him in order to cover risk of losing £4.


Does that apply to the Co-operative movement?


As a matter of fact, on very broad lines no confidence in Russian credit will be re-established by this Government or any other Government lending to the Russian Government. The only way is for Russia to make it plain to the people who trust her in this country, the ordinary manufacturers, that she will make good her obligations, and honour her national and municipal and private contracts. Up to the present she has repudiated her pre-War under takings. Let us be fair to those who have suffered losses by that repudiation. There are hundreds of millions sterling invested in Russian bonds and securities by British nationals, their savings, in fact—


France and Italy.


Yes, from France and Italy, and a large amount of money has been lent by the small British investors for £100, £200, £300, £400 and £500. These loans were not for warlike purposes. They were lent before the War to drain and pave, to light and to provide tramways, and for the great cities of Russia, Kieff, Moscow, Vilna, Nikolaieff, Saratoff. Every one of these loans, quite part from the money invested by British citizens in mines and oil wells and Russian railways, was provided by capital saved by small people in Britain at moderate rates of interest, and now the Russian Government has said she repudiates all pre-war debts. We cannot countenance such conduct towards pre-war investors. I am not justified as Parliamentary Secretary to the Department of Overseas Trade to allow the taxpayers' money to run the risk of being lost for a second time. That would be stupid, after our experience. I will go further, though I do not want to say too much about it, and would ask hon. Members opposite to inquire or ask Russia to explain what she has done with the credit balances' of nine millions and the six millions—£15,000,000 in all. Why, if they want our goods, have they not used this British credit on their exports? What have the Russians done with that money? If they had it here, why did they not use it for herrings and ploughs'? This country has not too much money nowadays to lend. We require all of our credit balances on our foreign trade to lend to friends who will take our goods and pay for them. The Dominions would never dream for one moment of going back on their contracts. They need our savings for development. So does South America. We have plenty of demands all over the world for our capital to set up reproductive works in. foreign countries, who have been always our friends and customers, and our honest debtors. They have plenty of profitable openings for our credit and savings, much safer than with a debtor or borrower who has repudiated and declines to recognise obligations. We are not prepared, since we have suffered such abuse of our pre-war confidence, to take the risk of losing money a second time to a country which has ruined the basis of her credit by repudiating the sanctity of contract.


I would not have intervened in this Debate had it not been for the remarkable speech to which we have just listened. The hon. Gentleman who has just sat down has explained that it is difficult to put sound financial ideas into the heads of the Labour party. I venture to think that the hon. Gentleman himself was not very clear either in his economics or in the lessons which he proved from these economics. I always hoped that sound finance might be expected to come from him, and yet to-night what an exhibition we have had. He told us that Russia in 1924 sent us 20 millions and only took from us 11 millions, and then he turns to these Benches and asks what have they done with the balance? What has happened to these credits. Why they could buy all the herrings on the land. The point is that there is a balance credit in this country of nine solid millions, and what have they done with it. Why do not they buy the herrings, he asks, and left us to assume that a good solid nine million pounds had gone for good solid political propaganda. He says it is scandalous that they should use the credit of this country for buying goods in other countries and taking them to Russia. No one knows better than those on the opposite benches that if they used that credit of 9 millions for buying goods in America it has been balanced by an export of 9 millions of goods from this country to America. Therefore, in the long run we are no worse off.


That is not the point. The point was, and for brevity I will concede what the hon. and gallant Gentleman says, that they are buying goods in America as he assumes, with their British credits; but why do the Russians come along and whin© for the export credits instead of spending here the credits they are using in America?


The hon. Member is trying to induce these woolly-headed Labour Members to believe there was unemployment created in this country owing to the fact that these Russians would not order their goods here. As a matter of fact, we are more prosperous by sending the goods to America than we should be by sending them to Russia. I always think it is a great mistake to underrate the intelligence of the House of Commons by putting forward false economic arguments. I think it is also a mistake to create prejudice against perfectly legitimate trade by dealing with the character and attitude and methods of the people you want to trade with. The hon Member has told us twice already that the Russians come whining for credits. The people who are sitting on these benches to-night are not here as representing the Russian Government or the Russian people. Whether the Russians are whining for credits or not is of no interest to us. Those we are speaking for are the people in this country who want the occupation of making or finding the goods which the Russians are prepared to buy. If there is any whining in this debate it is the whining of men in the constituencies who are out of work. Hon. Members opposite do not like the Russian people or the Russian Government. The Secretary to the Overseas Trade Department went on to give us almost a historical lecture on the impossibility of doing trade with people who had not paid their debts. He told us of the people who had lost their money through trusting their investments to different Russia cities. Listening to the hon. Member, one would imagine the Russian people, the Russian towns, and the Russian State were the only ones who had repudiated their obligations. There is hardly a country in South America that has not gone through the same phase.


What about the United States?


Is the hon. Member prepared to say that we must never do any trade with the State of South and North Carolina because they did not pay up their investors who lent them money? If we conducted our trade on these lines of historical research, there would be no trade left. We cannot afford to take the line suggested by the hon. Gentleman in these days because if we did there would be no trade left. The French and Italian Governments are not paying their debts. I do think that the hon. Gentleman when he intervenes in Debates should try to put the case absolutely fairly. He knows as well as I do that an irresistable case can be made out against the whole of his export credits scheme and that it is not necessary to make any distinction between the countries and businesses which are assisted so long as they are financially and economically sound propositions. The hon. Gentleman's colleague, the Financial Secretary to the Treasury, is responsible for advancing two million pounds to light the City of Athens. I do not think there is much difference between the financial state of Greece and that of Russia. Any loan, any credit depends naturally on security.

There was one other point which I should like to refer to in the speech of the hon. Gentleman's predecessor, the Financial Secretary to the Treasury, who was very candid with the Committee. He told the Committee frankly that this Bill was bad economics and bad finance and that he supported it because it was to help unemployment. I quite agree that it is thoroughly unsound finance. If your Trade Facilities Acts really led to more employment in this country there is not a man in this House on either side but would be asking, not for 75 millions but 750 millions for the scheme. It is because we know that it does not increase the sum total of employment in the least, but merely puts business in one line and takes it away from another, that we do not like the scheme.

Take the case of the two millions for the Kentish coalfields scheme. No doubt the expenditure for the coalfields in Kent will lead to the large increase of employment of coal miners in Kent, but my miners in North Staffordshire will be out of employment. There will be no increase of employment in the county as a whole unless the Kentish coalfields can produce coal more economically than elsewhere. We have in this county for investment in some way yearly about 260 millions of British capital. To make it easier for certain particular businesses to get cheap money would mean merely taking the money from one business and giving it to another. You cause more employment in certain directions and less employment in others. As the hon. Member says, an unsound scheme will never benefit the trade of the country in the long run. We have flown year after year in the face of economic laws and the only result is that the law has come back and hit us on the head like a punching ball. I had hoped, after the Debate we had on this subject last year, that the Government would have come to the conclusion that this Trade Facilities Act should be considered a dead letter. Every year we have a Debate on this question, and more and more hon. Members in all parts of the House become convinced that these are utterly unsound schemes. We have now had an official declaration to that effect from the Front Bench. It is like dram drinking; it grows on you. Once you put a man in charge at the Treasury he says: "We will just have another £5,000,000 for the export scheme, or the Trade Facilities Act," and so it goes on. In the long run the common sense of this House, or of the country, will tell even the present Government that there has been enough of unsound finance—whether it is Protection, or this other form of protection which is entitled the Trade Facilities Act.


Except for the purpose of raising one or two points I should not have intervened in this Debate. I shall not follow the right hon. Gentleman who has just spoken either into his curious gymnastic exercises, or the site value of the herring on land. I will confine myself to certain points of general admininstration of the Trade Facilities scheme. The right hon. Gentleman showed in his speech that he embodies a curious mixture of modern Socialist and Cohdenist opinions. He is always roused by mention of Russia and then forgets his sound economic doctrine of 30 or 40 years ago. There is one point I am bound to put to the Financial Secretary of the Treasury with regard to the actual administration of this scheme. Criticism seems to me to be directed, not so much against the general system of trade facilities but rather to the fact that the scheme has been administered in a rather vague manner. What is wanted is a definite plan—not that credit should be given here, or a guarantee made there, to this business or that other business without relation to the economic state of that form of industry and industry as a whole. There is a case in my knowledge which has excited considerable apprehension in some of the heavy industries. We understand that the Treasury, through this Committee, has recently granted a loan for the purpose of completing a large plate-rolling mill in this country at a time when the possible production of modern and economic plant is far greater than the market really needs. It does seem to me very doubtful whether that is a wise course—at a time when heavy industry is suffering not from inefficiency, or need of modern up-to-date plant, but lack of orders—to devote State credit to setting up a rival enterprise in this period of industrial depression. We ought to devote this credit to creating new industries and fresh markets and not for the purpose of diverting employment simply from one locality to another. In respect of this particular case, I would like to ask the Financial Secretary whether he can assure us that it will be the definite policy in the future, as it should have been in the past, that credits in this scheme are to be used in relation to the state of a particular form of industry at the moment; that they are very carefully to be used not to create an unnecessary amount of competition in a market suffering from too much competition, but rather in modernising plant through existing enterprises and not in the creation of campeting enterprises, especially in those industries suffering from lack of sufficient orders.


I would like to draw the attention of the Secretary to the Overseas Trade Department to a statemen he made to the House a short time ago. He seemed quite satisfied with the present system whereby the decisions arrived at by the Committee are passed on to the Government for recognition in this House by vote. What I want to put forward is that we had certain sneering to-night by the Secretary to the Overseas Trade Department as to the business, capacity of the Gentlemen on these benches. What we are discussing to-night is brought forward as a result of the investigation of three Gentlemen, in whom the Secretary says that he has every confidence. But while he may have confidence in three Gentlemen he may know, or whose business histories he knows, how are we to know whether any one of these Gentlemen has the knowledge which enables him to say whether it is a good thing for the nation to advance £2,000,000 to Pearson and Dorman Long? If these gentlemen did not have the knowledge themselves as to what the Kent coalfield is, had they the advice of experienced men regarding coalfields? Did the Treasury satisfy itself that all proper matters had been gone into before recommending this £2,000,000? When a Government of business men acts like the present Government had done when doing business I can tell them, knowing a little bit of business myself, that that is not the way business should be treated. I cannot imagine the Secretary to the Overseas Trade Department handing out £2,000,000, nor even twopence, without knowing exactly what was going to be the result of the investment. I am not blaming him for that characteristic. I want him to apply to the Government what he applies to his own business. We have not had a single word as to the value of this coalfield. I tried to-night to find cut whether the Secretary for Mines had any information about it. He has none. I asked the Financial Secretary to the Treasury. He has none. I went round other Members of the House interested in mine-owning. They had no knowledge Yet I am told by the Secretary to the Overseas Trade Department that we have no business capacity. It is all very well for anyone on the other side to try and sneer at these benches here, but that is where you miss the boat. You miss the boat every time when you come up against questions like I am putting to you now, because you are incapable of answering, because neither of you know a coalfield from any other kind of field.


The hon. Member must address himself to me.


We are asked to plunge into a credit of £2,000,000 without the slightest knowledge as to what it is on the part of those who are asking us to vote. For instance, they have not told us anything at all about the defects of the coalfield. So far as the Kent coalfield is concerned, they have not told us that the content of sulphur is so high in that coal that they will not be able to use it like ordinary coal in the furnaces. There is not a word about this; yet they are all supposed to be dead, trained, sincere, honest business men. Well, you are dead; that part is all right. As business men you are corpses. But what are the assets in view of a possible failure in Kent? In giving this credit to the Kent group, I accuse them of fraudulent process. To ask for £2,000,000 for an unproved field of coal is simply so much fraud, but it seems a good thing on business men's part to act as frauds when it is bleeding the British taxpayer. But what about the assets? Suppose this is a failure—as it may quite reasonably be—what have you left? You will be left with some holes in the ground and the coal underneath that cannot be made of any commercial value. What is then to be the position of the taxpayer who has become responsible to the extent of £2,000,000? I would like the business men on the other side to give us some idea as to what they mean when they say they come forward with full confidence in the recommendations.

A question has also been raised about Russia, and I only want to deal with one point on that. The Russian timber that we ought to be having direct has been bought up by the Americans, and England has been flooded during the last fortnight with catalogues of Russian timber. That is timber that we should have had direct if we had had some business men in charge. When you get in touch with those who are doing business in Russia you find there is no complaint about delay in payment. Why, then, should hon. Gentlemen opposite sneer at us on these benches because we are not business men, when they have proved themselves to be absolutely incapable of even organising a single line of business with such a great and wealthy nation as Russia? Even the ordinary moneylender has more knowledge of how to create a credit than has been shown by the present Government. Even they in their small way can point the way. But here we have a great British Government—a Tory Government at that—with a Front Bench that can claim all kinds of credit for their capacity, especially the Secretary to the Overseas Trade Department, who has great business capacity. Yet, to-night we have had a speech from him that would not do credit to a fifth standard school boy in economics. His mind seems to be confused with herrings and finance. It is no use talking about trades facilities in that loose and, I might say, uneducated way. Trade facilities were begun with one object, not to embark upon speculative things such as the coal field, not to lend money to brickworks that became impossible from bad management and not to leave it to three men in whom the Financial Secretary to the Treasury says he has every confidence. I would have had confidence in them had their results been what business men ought to expect. This is no new discussion. Every year in this House we have had the same trouble. Let me say in conclusion that if we are going to get any results at all from trades facilities it is by touching things that are going to increase trade within this country. You can only increase trade within this country by increasing your trade with outside countries, and the only means of doing that is by using your trade credits in that direction. Two years ago when a firm in England wanted to set up a plant in the Malay Islands to produce certain chemicals, the plant was ordered through a firm of engineers in Glasgow. Then as soon as this was seen to be a sound proposal, giving work to people in Glasgow and producing something within the Empire for which we were in great need, the Trade Facilities Act was denied. But when it came to a brickworks doomed to failure it was given, as also is done when it comes to a speculation in a coal field and two millions given. I hope before another year comes round when we discuss this there will be changes on the Front Bench.


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

Question put, "That the Question be now put."

The Committee proceeded to a Division.


(seated and covered): On a point I want to know whether the hon. Member for Springburn (Mr. Hardie) was in order in using the word "fraud" in relation to Messrs. Pearson and Dorman Long. They are a firm who hold a very high reputation in this country. Their most important representative was a Member of this House. He was a Minister of the Crown during the War, and even if "fraud" is a Parliamentary expression in relation to this company's application for credit under this Bill, I feel it my duty to deny the charge and protest against it.


I do not think it is out of order. If I remember rightly, in the first Parliament I was in the hon.

Member for Derbyshire, Sir Arthur Markham, used a similar expression in regard to persons or authorities in South Africa, and it was not ruled out of order.


(seated and covered): I wish to raise a point of Order. Is it in order to move the Closure when there is an Amendment on the Paper which has not been considered at all and no opportunity has been given to consider it.


Plenty of opportunity has been given to move such an Amendment in the last three hours and a half.

The Committee divided: Ayes, 160; Noes, 58.

Division No. 39.] AYES. [1.47 a.m.
Acland-Troyte, Lieut.-Colonel Harland, A. Percy, Lord Eustace (Hastings)
Agg-Gardner, Rt. Hon. Sir James T. Harmsworth, Hon. E. C. (Kent) Perkins, Colonel E. K.
Albery, Irving James Harrison, G. J. C. Peto, G. (Somerset, Frome)
Amery, Rt. Hon. Leopold C. M. S. Hartington, Marquess of Philipson, Mabel
Barclay-Harvey, C. M. Haslam, Henry C. Raine, W.
Barnston, Major Sir Harry Hawke, John Anthony Ramsden, E.
Betterton, Henry B. Headlam, Lieut.-Colonel C. M. Reid, Captain A. S. C. (Warrington)
Boothby, R. J. G. Henderson, Capt. R. R. (Oxf'd, Henley) Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Bourne, Captain Robert Croft Heneage, Lieut.-Col. Arthur P. Ropner, Major L.
Bowyer, Capt. G. E. W. Henn, Sir Sydney H. Salmon, Major I.
Briggs, J. Harold Hennessy, Major J. R. G. Samuel, A. M. (Surrey, Farnham)
Briscoe, Richard George Herbert, Dennis (Hertford, Watford) Sandeman, A. Stewart
Brittain, Sir Harry Hills, Major John Waller Sanderson, Sir Frank
Brocklebank, C. E. R. Hilton, Cecil Sandon, Lord
Brooke, Brigadier-General C. R. I. Holland, Sir Arthur Savery, S. S.
Broun-Lindsay, Major H. Holt, Captain H. P. Shaw, Lt.-Col. A. D. McI. (Renfrew, W)
Brown, Brig.-Gen. H. C.(Berks, Newb'y) Hope, Capt. A. O. J. (Warw'k, Nun.) Shaw, R. G. (Yorks, W. R., Sowerby)
Burton, Colonel H. W. Hope, Sir Harry (Forfar) Shaw, Capt. W. W. (Wilts, Westb'y)
Butt, Sir Alfred Hopkins, J. W. W. Sheffield, Sir Berkeley
Campbell, E. T. Howard, Captain, Hon. Donald Shepperson, E. W.
Cazalet, Captain Victor A. Hudson, Capt. A. U. M. (Hackney, N.) Skelton, A. N.
Churchill, Rt. Hon. Winston Spencer Huntingfield, Lord Slaney, Major P. Kenyon
Cobb, Sir Cyril Inskip, Sir Thomas Walker H. Smith-Carington, Neville W.
Cochrane, Commander Hon. A. D. Jacob, A. E. Smithers, Waldron
Couper, J. B. Kennedy, A. R. (Preston) Somerville, A. A. (Windsor)
Craig, Ernest (Chester, Crewe) Kidd, J. (Linlithgow) Stanley, Lord (Fylde)
Crookshank, Col. C. de W. (Berwick) Kindersley, Major G. M. Stanley, Col. Hon. G. F. (Will'sden, E.)
Crookshank, Cpt. H. (Lindsey, Gainsbro) King, Captain Henry Douglas Stanley, Hon. O. F. G. (Westm'eland)
Curzon, Captain Viscount Knox, Sir Alfred Steel, Major Samuel Strang
Davidson, J. (Hertf'd, Hemel Hempst'd) Lamb, J. Q. Storry-Deans, R.
Davidson, Major-General Sir J. H. Lane Fox, Col. Rt. Hon. George B. Stott, Lieut.-Colonel W. H.
Davies, Maj. Geo. F.(Somerset, Yeovil) Little, Dr. E. Graham Streatfeild, Captain S. R.
Dawson, Sir Philip Locker-Lampson, Com. O. (Handsw'th) Thom, Lt.-Col. J. G. (Dumbarton)
Dean, Arthur Wellesley Loder, J. de V. Thompson, Luke (Sunderland)
Dixey, A. C. Looker, Herbert William Thomson, F. C. (Aberdeen, South)
Eden, Captain Anthony Lucas-Tooth, Sir Hugh Vere Thomson, Rt. Hon. Sir W. Mitchell-
Edmondson, Major A. J. Luce, Major-Gen. Sir Richard Harman Wallace, Captain D. E.
Everard, W. Lindsay Lumley, L. R. Warrender, Sir Victor
Fairfax, Captain J. G. MacAndrew, Charles Glen Watson, Rt. Hon. W. (Carlisle)
Fermoy, Lord McLean, Major A. Watts, Dr. T.
Ford, Sir P. J. Macmillan, Captain H. Wells, S. R.
Forestier-Walker, Sir L. McNeill, Rt. Hon. Ronald John Wheler, Major Sir Graville C. H.
Foster, Sir Harry S. MacRobert, Alexander M. Williams, A. M. (Cornwall, Northern)
Fremantle, Lieut.-Colonel Francis E. Maitland, Sir Arthur D. Steel Williams, Com. C. (Devon, Torquay)
Gadie, Lieut.-Colonel Anthony Malone, Major P. B. Williams, Herbert G. (Reading)
Gibbs, Col. Rt. Hon. George Abraham Merriman, F. B. Windsor-Clive, Lieut.-Colonel George
Gilmour, Lt.-Col. Rt. Hon. Sir John Mitchell, S. (Lanark, Lanark) Winterton, Rt. Hon. Earl
Glyn, Major R. G, C. Moore-Brabazon, Lieut.-Col. J. T. C. Wise, Sir Fredric
Greene, W. P. Crawford Morrison-Bell, Sir Arthur Clive Womersley, W. J.
Grotrian, H. Brent Nelson, Sir Frank Wood, E. (Chest'r, Stalyb'dge & Hyde)
Gunston, Captain D. W. Newman, Sir R. H. S. D. L. (Exeter) Woodcock, Colonel H. C.
Hacking, Captain Douglas H. Nicholson, O. (Westminster) Yerburgh, Major Robert D. T.
Hanbury, C. O'Neill, Major Rt. Hon. Hugh
Hannon, Patrick Joseph Henry Penny, Frederick George TELLERS FOR THE AYES.—
Major Cope and Captain Margesson.
Adamson, Rt. Hon. W. (Fife, West) Hall, G. H. (Merthyr Tydvil) Shaw, Rt. Hon. Thomas (Preston)
Alexander, A. V. (Sheffield, Hillsbro') Hardie, George D. Shiels, Dr. Drummond
Baker, Walter Henderson, Rt. Hon. A. (Burnley) Sinclair, Major Sir A. (Caithness)
Barnes, A. Hirst, G. H. Spencer, G. A. (Broxtowe)
Barr, J Jenkins, W. (Glamorgan, Neath) Stephen, Campbell
Batey, Joseph John, William (Rhondda, West) Taylor, R. A.
Beckett, John (Gateshead) Johnston, Thomas (Dundee) Thurtle, E.
Broad, F. A. Jones, T. I. Mardy (Pontypridd) Tinker, John Joseph
Buchanan, G. Kelly, W. T. Varley, Frank B.
Charleton, H. C. Kirkwood, D. Warne, G. H.
Collins, Sir Godfrey (Greenock) Lawson, John James Watson, W. M. (Dunfermline)
Crawfurd, H. E. Lindley, F. W. Wedgwood, Rt. Hon. Josiah
Dalton, Hugh Mackinder, W. Welsh, J. C.
Davies, Evan (Ebbw Vale) MacLaren, Andrew Whiteley, W.
Davies, Rhys John (Westhoughton) Maxton, James Wilson, R. J. (Jarrow)
Day, Colonel Harry Oliver, George Harold Windsor, Walter
Fenby, T. D. Parkinson, John Allen (Wigan)
Gillett, George M. Pethick-Lawrence, F. W. TELLERS FOR THE NOES.-Mr. Charles Edwards and Mr. Hayes.
Grenfell, D. R. (Glamorgan) Potts, John S.
Grundy, T. W. Richardson, R. (Houghton-le-Spring)
Hall, F. (York, W. R., Normanton) Saklatvala, Shapurji

Question put accordingly.

The Committee divided: Ayes, 157; Noes, 55.

Division No. 40.] AYES. [1.55 a.m.
Acland-Troyte, Lieut.-Colonel Harrison, G. J. C. Philipson, Mabel
Agg-Gardner, Rt. Hon. Sir James T. Hartington, Marquess of Raine, W.
Albery, Irving James Haslam, Henry C. Ramsden, E.
Amery, Rt. Hon. Leopold C. M. S. Hawke, John Anthony Reid, Capt. A. S. C. (Warrington)
Barclay-Harvey, C. M. Headlam, Lieut.-Colonel C. M. Richardson, Sir P. W. (Sur'y, Ch'ts'y)
Barnston, Major Sir Harry Henderson, Capt. R. R. (Oxf'd, Henley) Ropner, Major L.
Betterton, Henry B. Heneage, Lieut.-Colonel Arthur P. Salmon, Major I.
Bourne, Captain Robert Croft. Henn, Sir Sydney H. Samuel, A. M. (Surrey, Franham)
Briscoe, Richard George Hennessy, Major J. R. G. Sandeman, A. Stewart
Brittain, Sir Harry Herbert, Dennis (Hertford, Watford) Sanderson, Sir Frank
Brocklebank, C. E. R. Hills, Major John Waller Sandon, Lord
Brooke, Brigadier-General C. R. I. Hilton, Cecil Savery, S. S.
Broun-Lindsay, Major H. Holland, Sir Arthur Shaw, Lt.-Col. A. D. McI. (Renfrew, W.)
Brown, Brig.-Gen. H. C. (Berks, Newb'y) Holt, Capt. H. P. Shaw, R. G. (Yorks, W. R., Sowerby)
Burton, Colonel H. W. Hope, Capt. A. O. J. (Warw'k, Nun.) Shaw, Capt. W. W. (Wilts, Westb'y)
Butt, Sir Alfred Hope, Sir Harry (Forfar) Sheffield, Sir Berkeley
Campbell, E. T. Hopkins, J. W. W. Shepperson, E. W.
Cazalet, Captain Victor A. Howard, Captain Hon. Donald Skelton, A. N.
Churchill, Rt. Hon. Winston Spencer Hudson, Capt. A. U. M. (Hackney, N.) Slaney, Major P. Kenyon
Cobb, Sir Cyril Huntingfield, Lord Smith-Carington, Neville W.
Cochrane, Commander Hon. A. D. Inskip, Sir Thomas Walker H. Smithers, Waldron
Cope, Major William Jacob, A. E. Somerville, A. A. (Windsor)
Couper, J. B. Kennedy, A. R. (Preston) Stanley, Lord (Fylde)
Craig, Ernest (Chester, Crewe) Kidd. J. (Linlithgow) Stanley, Col. Hon. G. F. (Will'sden, E.)
Crookshank, Col. C. de W. (Berwick) Kindersley, Major Guy M. Stanley, Hon. O. F. G. (Westm'eland)
Crookshank, Cpt. H. (Lindsey, Gainsbro) King, Captain Henry Douglas Steel, Major Samuel Strang
Curzon, Captain Viscount Knox, Sir Alfred Storry-Deans, R.
Davidson, J. (Hertf'd, Hemel Hempst'd) Lamb, J. Q. Stott, Lieut.-Colonel W. H.
Davidson, Major-General Sir J. H. Lane Fox, Col. Rt. Hon. George R. Streatfeild, Captain S. R.
Davies, Maj. Geo. F. (Somerset, Yeovil) Little, Dr. E. Graham Thom, Lt.-Col. J. G. (Dumbarton)
Dawson, Sir Philip Locker-Lampson, Com. O. (Handsw'th) Thompson, Luke (Sunderland)
Dean, Arthur Wellesley Loder, J. de V. Thomson, F. C. (Aberdeen, South)
Dixey, A. C. Looker, Herbert William Thomson, Rt. Hon. Sir W. Mitchell-
Eden, Captain Anthony Lucas-Tooth, Sir Hugh Vere Wallace, Captain D. E.
Edmondson, Major A. J. Luce, Major-Gen. Sir Richard Harman Warrender, Sir Victor
Everard, W. Lindsay Lumley, L. R. Watson, Rt. Hon. W. (Carlisle)
Fairfax, Captain J. G. MacAndrew, Charles Glen Watts, Dr. T.
Fermoy, Lord McLean, Major A. Wells, S. R.
Ford, Sir P. J. McNeill, Rt. Hon. Ronald John Wheler, Major Sir Granville C. H.
Forestier-Walker. Sir L. MacRobert, Alexander M. Williams, A. M. (Cornwall, Northern)
Foster, Sir Harry S. Maitland, Sir Arthur D. Steel- Williams, Com. C. (Devon, Torquay)
Fremantle, Lieut.-Colonel Francis E. Malone, Major P. B. Williams, Herbert G. (Reading)
Gadie, Lieut.-Col. Anthony Merriman, F. B. Windsor-Clive, Lieut.-Colonel George
Gibbs, Col. Rt. Hon. George Abraham Mitchell, S. (Lanark, Lanark) Winterton, Rt. Hon. Earl
Gilmour, Lt.-Col. Rt. Hon. Sir John Moore-Brabazon, Lieut.-Col. J. T. C. Wise, Sir Fredric
Glyn, Major R. G. C. Morrison-Bell, Sir Arthur Clive Womersley, W. J.
Greene, W. P. Crawford Nelson, Sir Frank Wood, E. (Chest'r, Stalyb'dge & Hyde)
Grotrian, H. Brent Newman, Sir R. H. S. D. L. (Exeter) Woodcock, Colonel H. C.
Gunston, Captain D. W. Nicholson, O. (Westminster) Yerburgh, Major Robert D. T.
Hacking, Captain Douglas H. O'Neill, Major Rt. Hon. Hugh
Hanbury, C. Penny, Frederick George TELLERS FOR THE AYES.—
Hannon, Patrick Joseph Henry Percy, Lord Eustace (Hastings) Captain Margesson and Captain Bowyer.
Harland, A. Perkins, Colonel E. K.
Harmsworth, Hon. E. C. (Kent) Peto, G. (Somerset, Frome)
Adamson, Rt. Hon. W. (File, West) Hall, G. H. (Merthyr Tydvil) Richardson, R. (Houghton-le-Spring)
Alexander, A. V. (Sheffield, Hillsbro') Hardie, George D. Saklatvala, Shapurji
Baker, Walter Hayes, John Henry Shiels, Dr. Drummond
Barr, J. Henderson, Rt. Hon. A. (Burnley) Sinclair, Major Sir A. (Caithness)
Batey, Joseph Hirst, G. H. Spencer, George A. (Broxtowe)
Beckett, John (Gateshead) Jenkins, W. (Glamorgan, Neath) Stephen, Campbell
Broad, F. A. John, William (Rhondda, West) Taylor, R. A.
Buchanan, G. Johnston, Thomas (Dundee) Thurtle, E.
Charleton, H. C. Jones, T. I. Mardy (Pontypridd) Tinker, John Joseph
Collins, Sir Godfrey (Greenock) Kelly, W. T. Varley, Frank B.
Crawfurd, H. E. Kirkwood, D. Warne, G. H.
Dalton, Hugh Lawson, John James Watson, W. M. (Dunfermline)
Davies, Evan (Ebbw Vale) Lindley, F. W. Wedgwood, Rt. Hon. Josiah
Davies, Rhys John (Westhoughton) Mackinder, W. Welsh, J. C.
Day, Colonel Harry MacLaren, Andrew Whiteley, W.
Edwards, C. (Monmouth, Bedwellty) Maxton, James Windsor, Walter
Fenby, T. D. Oliver, George Harold
Grenfell, D. R. (Glamorgan) Pethick-Lawrence, F. W. TELLERS FOR THE NOES.—
Grundy, T. W. Potts, John S. Mr. Parkinson and Mr. Barnes.
Hall, F. (York, W. R., Normanton)

Resolutions agreed to.

Resolution to be reported To-morrow.

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