BEET SUGAR SUBSIDY, GREAT BRITAIN.

HC Deb 16 February 1927 vol 202 cc949-94

Motion made, and Question proposed, That a Supplementary Sum, not exceeding £450,000, be granted to His Majesty, to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1927, for a Subsidy on Sugar and Molasses manufactured from Beet grown in Great Britain.

Colonel Sir GEORGE COURTHOPE.

Last night I had an opportunity of speaking on this question for two or three minutes before Progress was reported. I was then referring to some questions put to the Committee by the right hon. Gentleman the Member for Northern Norfolk (Mr. Buxton) who took a considerable part in establishing this industry, and who has expressed throughout his interest and encouragement in regard to it. In dealing with the question whether the sugar subsidy is justified or not—

The DEPUTY-CHAIRMAN

I have come to the conclusion that I was wrong in allowing the right hon. Gentleman the Member for Northern Norfolk (Mr. Buxton) to raise the question of the policy of sugar subsidy because that has already been decided. Seeing that this is simply a Vote due to under-estimating the amount required for the subsidy, it will not be in order to discuss again the policy of the subsidy.

Mr. A. V. ALEXANDER

I should like to be clear as to how far we are going to be allowed to debate the effect of the subsidy, not on production but on the finances of the factory. The Act of Parliament makes provision for the presentation of the accounts, and unless we can make proper criticisms on the Supplementary Estimates there is no other way of safeguarding the rights of Members of this House.

Colonel GRETTON

While it may be perfectly reasonable to exclude a discussion on the policy of these subsidies, surely we may be allowed to discuss the expenditure in these Estimates upon a new factory.

The DEPUTY-CHAIRMAN

I do not think that this is an occasion for a discussion upon the policy of the subsidy. This question of policy has been discussed on previous occasions and it has been decided by the House. It is now only a question of under-estimating the amount of the money required for the subsidy, therefore no question of policy can arise.

Mr. HARRIS

Surely a ruling of this kind makes it impossible to discuss the question of policy in regard to these subsidies at all.

The DEPUTY-CHAIRMAN

This is not an occasion to discuss the policy.

Lieut.-Commander KENWORTHY

May I draw your attention, Captain FitzRoy, to the fact that in the past, when dealing with a large sum of money like this, a fairly wide scope has been allowed in regard to the discussion. This is a very large sum indeed, and I put it to you respectfully that you might allow a fairly wide discussion.

The DEPUTY-CHAIRMAN

I agree that it is a very large sum, but it is only a fraction of the original Estimate, and that fact in no way affects the policy which has already been decided upon by the House.

Sir G. COURTHOPE

I propose to confine my remarks to the very satisfactory indication conveyed to my mind, and to the minds of others interested in the sugar beet industry, by the fact that a, Supplementary Estimate is necessary this year. When the original Estimates were drawn up, there was approximately accurate information as to the acreage that would be put under sugar beet this year. Where the original Estimates fell short of actual experience is in the volume of the crop grown per acre, and the quality of the beet that formed that crop. Those are the two factors which are the measure of commercial sugar produced on each acre of beet. Both of those factors have made a most satisfactory increase this year over the ex- perience of last year. Last year, in its turn, showed higher figures than the previous year. This indicates to my mind that the hopes of the pioneers of the sugar beet industry in this country are being justified. The farmers, and their labourers who are working this beet production on English farms, particularly in the Eastern Counties, are learning year by year to produce a larger quantity and a better quality of beet. It is of great importance that that should be so, because it is only by a steady improvement in the quantity and quality of the beet grown per acre, and the amount of commercial sugar produced per acre, that we based our hopes that the industry could establish itself in spite of the gradual fall and the eventual disappearance of the subsidy. There are many farmers who a few years ago were producing five, six or seven tons per acre of second-rate beet which are now producing 14, 16 and even 18 tons per acre. It is a justification for the subsidy that the tonnage per acre is a full ton more than was estimated, and the sugar percentage 1 per cent. more than that shown in the figures for last year. That is a strong indication that this House was right in deciding to make a great effort to try a great experiment in establishing a sugar beet industry under subsidy.

4.0 p.m.

What is the exact position with regard to the fall in the subsidy which takes place next year? There is one more year of the high-grade subsidy to go, and then it drops 6s. 6d. per cwt. of sugar. That 6s. 6d. drop, converted into terms of raw material of beet, means approximately per ton of beet delivered at the factory. That is on a 15½ per cent. basis. Probably, if the beet continues at the higher quality, as it is to-day, it will mean something over £1 per ton—that has to be borne either by the factory or by the farmer or both—from the present price which the factories are paying the farmers for their beet. I am a beet grower myself, and I say without hesitation, though I dare say many people will blame me for saying it, that the experience of this year proves beyond all doubt that the farmer who is growing beet with proper methods on suitable land is well able to bear a, full share in the inevitable fall in the price of beet owing to the fall in the amount of the subsidy. I am extremely hopeful, as are all those connected with the industry, that this improvement both in quantity and quality which we see this year will be maintained and will be progressive, and that, just as the farmers who have been growing for five or six years are producing at least double the amount of sugar per acre than they did when they started, so those who have grown this year for the first time will in four or five years' time be growing a much heavier crop of much higher quality than they are to-day, and that by that means we shall find that four years hence the second drop in the subsidy need be feared no more than I for one fear the impending drop next year.

There was one matter which I should like to deal with if I am not out of order, and that was the interjection—it was quite friendly—which came from the opposite benches when I started to speak last night. I was referring to this increase of production, and the interjection suggested that the result of that, and I gathered the only result, of that increase would be an increase of rent.

The DEPUTY-CHAIRMAN

That is not a question which we can discuss on this Vote.

Sir G. COURTHOPE

I dare say that another opportunity will arise when I can do so. In addition to the agricultural side with which I have attempted to deal insofar as it bears on the need for this Vote or this increase of subsidy, there is another element which also bears upon it. It is that, just as the agricultural side have tuned up year after year to greater efficiency, so has the manufacturing side. The efficiency in the factories producing beet sugar has been steadily improved. There is still room for improvement, but it has been steadily improving, and that, also, is a very good sign that our hopes and anticipations will prove to be justified and that when the subsidy comes to an end this industry may find itself on so sure a foundation that it will be able to compete with its international competitors in the sugar markets of the world.

Mr. ALEXANDER

Some of us on these benches, in discussing the grant of the subsidy to the British beet indus- try, have had occasion to make certain references to those who are engaged in the financing of it. I want to say at the outset that the hon. and gallant Member for Rye (Sir G. Courthope) who, as he published last night, has been mixed up with this industry from the beginning is in my judgment not the class of person engaged in the industry whom we ever desired to attack. I want to say here, as I have said before, that his long and devoted service to the cause, however mistaken in my judgment it may be, is from an altruistic point of view one of great worthiness, and, whatever I may say at a later stage, I am sure that the hon. and gallant Member will not think that I am in any way referring to his association with the industry. He has referred to the Vote as proving one or two things, and, as he has been allowed to make those points, I think you will also allow me to reply to them. He has stated that the request for an additional grant of £450,000 is really a proof that the production per acre has been better and that everything is going very well for the future of the sugar-beet industry. I recognise that there has been a slight increase in the yield per acre, and I recognise also that there has been a slight increase in the percentage of sugar content, but I altogether disagree with the hon. and gallant Member if he thinks that those slight increases show a clear period of prosperity for the sugar-beet industry in this country. I myself still think that when the industry comes to meet keen competitive winds on the first half subsidy rate and then with no subsidy at all these prognostications will prove to be entirely fallacious.

The hon. and gallant Member referred to the fact that all three parties in the House had been proved to be right in making great efforts to establish this particular industry. While it is true that the majority of all parties in the House were in favour of it, it is also true that there was at least a fairly important minority in each of the parties in the House who were against granting the subsidy, and I think when it comes to balancing the matter either in a year and a half's time, or, perhaps what will be a more important period, in five years' time, the minority in the matter will prove to have been on fairly safe ground. Moreover, he says that when the first reduction in the subsidy takes place its effect will be that the factories and the growers between them will have to provide rather more than £1 per ton, which is at present covered by the subsidy. It is very significant that the hon. and gallant Member should then say from his personal experience as a grower that he thought the farmer would be well able to meet a share—I gathered from the tone of his remarks a considerable share—of that £1 per ton which had to be found. Then what becomes of the claim which has always been made in connection with this subsidy, that it was going to mean considerably higher wages for the workers in the agricultural industry?

The DEPUTY-CHAIRMAN

The hon. Member began his remarks by saying that he thought I should allow him to reply to some remarks which had been made by the hon. and gallant Member for Rye (Sir G. Courthope). I think he has gone far enough in that direction now, and he must return to the actual Vote.

Mr. ALEXANDER

I am very loath, to be at variance at any time with the Chair, but the hon. and gallant Member has made a statement that the farmer is well able to bear a share of the reduction, and surely it is not unreasonable to be able to answer the point that he has made. It is difficult for us to reply to that unless we draw the proper deductions from the result of the farmer bearing a share of the reduction. If I am not allowed to pursue the matter, I limply ask the hon. and gallant Member to think it over in the meantime. I do not want to beat variance with the Chair on the point, but I am quite certain that it is not going to be possible, as the industry goes on under the new conditions, to fulfil the pledge that was made in respect of higher wages, if the farmer has to bear that share of the reduction. I would also remind him on that point that, when it comes to the end of the total period of the subsidy, the farmer will have to look to a very much larger reduction, and, whereas the price of beet, which has had to be covered under the subsidy which we are voting to-day, has been, I suppose, a variable figure from 44s. to 50s. per ton, Sir Daniel Hall, the expert of the Ministry of Agriculture, has said on more than one occasion, and perhaps never more clearly than in his introduction to a book on beet sugar production, that, ultimately the farmer will have to face the production of beet at a price of not more than from 25s. to 30s. per ton. The hon. and gallant Member agrees.

All I can say is that the imports of sugar as compared with home-produced sugar during the last two years do not show to me that under such circumstances the British farmer will be able to make a success of beet growing at that price. Ws were told yesterday by my right hon. Friend the Member for Northern Norfolk (Mr. Buxton) that one result of the subsidy had been that we were now in this country producing, instead of a negligible quantity, five weeks' supply. Yes, but when I examine the figures of this year in more detail I find that imported refined sugar has increased in volume, although we have also this larger measure of home-grown sugar. Really, what has happened has been that the sugar which was formerly known as British refined sugar, in which there was a considerable volume of employment in this country, has been merely substituted by the homegrown sugar from the beet industry. In 1925 57 per cent. of our sugar was British refined. In 1926 it was only 35 per cent., a drop of 22 per cent. It is significant, in those circumstances, that the homegrown sugar has increased from 7 per sent. to 22 per cent-. While the subsidy which we are voting to-day may be argued by some to have been providing employment in agricultural areas, and I agree at once that it has provided a certain amount of employment, it has also displaced in Silvertown and in Greenock, men who are now on the Employment Exchanges unable to get work as the result of the payment of this subsidy.

Lieut.-Commander BURNEY

Can the hon. Member say what the effect on unemployment has been on balance, taking into consideration the extra employment in agriculture?

Captain CROOKSHANK

Could the hon. Member also say anything about the volume? If he has the figures with regard to that, I think they would be interesting.

Mr. ALEXANDER

I have not, as a matter of fact, got them with me at the moment—

The DEPUTY-CHAIRMAN

The hon. Member now appears to be entering into an argument with hon. Members on the other side as to what has been the effect of the subsidy upon unemployment. That, however, is not really the point before the Committee to-day. This is a Supplementary Estimate to provide for the fact that a larger quantity of beet has been grown under the subsidy than was originally contemplated. That is the only question before the Committee.

Mr. ALEXANDER

It is very difficult to exercise an effective check upon the large expenditure from public funds which is involved in a Supplementary Vote of £450,000—which is not a small sum—unless we can also exercise our right to criticise the object of the expenditure when we are voting as representing the people, and, although I agree that it is difficult sometimes to get away from Standing Orders, I hope that you, Sir, will take the view expressed by my hon. and gallant Friend the Member for Central Hull (Lieut.-Commander Kenworthy) that, when we are considering such a large sum, we should be allowed as much latitude as is possible in the circumstances.

The DEPUTY-CHAIRMAN

I am sure I should be wrong in allowing, on a Supplementary Estimate, so wide a discussion as the hon. Member suggests. This Supplementary Estimate is only for the increased sum required in respect of the increased amount of sugar beet that has been grown.

Mr. ALEXANDER

If that be so, I shall do no more than inform the House as to what is the financial result of the voting of the money, and I think, Sir, you will agree that that will not be out of order. When the Bill itself was passing through the House, we insisted on the insertion of a Clause providing for the laying before the House from time to time of duly audited accounts of the beet factories which were set up as a result of the subsidy. Unfortunately, I was unable to persuade the Minister at the time that the accounts should be as detailed as I should have liked, and we are confined to an audited statement of liabilities and assets. Even so, from that we are able to get a very fair idea as to what the effect of the subsidy really is. Taking the season 1925–26, the accounts of which are published in White Paper No. 133, the Kelham Factory shows a surplus of £3,125, Cantley—

The DEPUTY-CHAIRMAN

I do not see that that has anything to do with this Supplementary Estimate. The Estimate has nothing to do with the accounts of the various factories; it is merely a question now of the amount of sugar that is going to be grown, and for which the subsidy is required. That is the only question before the Committee, and I must ask the hon. Member to be good enough to adhere to it.

Mr. ALEXANDER

In that case I am not going to pursue my argument to-day, but will only say that I think it is unfortunate—I am not in any way reflecting upon the Chair; I am sure you will understand that—that, in the voting of such a very large sum as this, we cannot be allowed to express the views of constituents and of taxpayers generally upon the object for which it is asked for.

Major G. DAVIES

As a rule, when the House is faced with Supplementary Estimates, it is a field day and an opportunity for hon. Members who happen to be in Opposition, to whichever party they belong, because their Whips come to them and say, "If you cannot legislate for your country, you can procrastinate for your party." On this occasion, however, the severe limits which you, Sir, have set to the Debate will not only facilitate the smooth passage of this Estimate, but will rather cramp the style of everyone who wishes to take part in the Debate. I do not complain of that for a moment, but certainly it does rule out a great many matters of general interest which some of us would like to touch upon. You yourself, Sir, have pointed out that the real matter before the Committee is that an additional amount of Government subsidy has to be provided because an additional amount of sugar beet beyond that which was estimated has been grown in this country during the past year. The right hon. Gentleman who was Minister of Agriculture when the Labour party were in office pointed out yesterday that he regarded the whole question of this subsidy as an educational grant. If that be so, surely we may take unction unto ourselves that the policy of His Majesty's Government has resulted in such an extension of well-applied subsidy towards the matter of education with regard to agriculture. The right hon. Gentleman expressed some doubt as to whether the farmers of the country had been taking full advantage of the educational facilities of various kinds which this and preceding Governments have endeavoured to place at their disposal, but, nevertheless, it does seem to me that, although, as the last speaker pointed out, this is in itself a considerable sum of money that we are asked to vote to-day, that is a proof of the soundness and the success of the policy which deliberately decided that some such sum should be applied, not only to broaden education in the matter of agriculture—

Mr. ALEXANDER

On a point of Order. Hon. Members are allowed to say from the other side that the voting of this sum of money to-day is a proof of the wisdom of the policy which has already been decided in this House; but, when that point is made from the other side, we are not allowed to use any facts or figures or make any general case to show that we do not approve of that and to prove that the statements made by hon. Members are not well founded.

The DEPUTY-CHAIRMAN

Perhaps the hon. Member misunderstood my previous ruling. I understood that the hon. and gallant Member was only stating what had been said by a previous speaker.

Major DAVIES

In the interests of harmony and in my own interests I shall endeavour to keep within the rules of order as I understand they have been laid down in regard to this Debate. I was merely endeavouring, in a general way, to point out that what we are being asked to do is to approve of a Supplementary Estimate which, in itself, was absolutely inevitable if there was to be a really successful result of the policy which was originally laid down in connection with the provision of the subsidy. The reason is simply that, as you, Sir, have said, there has been an additional area of sugar beet planted, and that sugar beet itself has been a move valuable article. I myself can bear testimony to what was laid down by my hon. and gallant Friend the Member for Rye (Sir G. Courthope) with regard to the improvement of methods and results in this nascent industry. While we can all pose as prophets with regard to what the results are going to be in the times that are ahead of us when the subsidy is entirely removed, surely, even if we take a pessimistic view of those possibilities, it is a matter of satisfaction that, under the present conditions at least, the result is one of progress rather than of recession. Therefore, it does seem to me that, of all Supplementary Estimates that may come before this Committee—and we always deplore the necessity for such things—this is one which it is impossible to deplore, because it is inevitable, having regard to the development of the industry, and from our point of view it is a satisfactory proof of the desirability of the policy that has been deliberately pursued by His Majesty's Government. Therefore, my feeling, in voting in favour of this Supplementary Estimate, is an exception to my feelings on other Supplementary Estimates, and I do so with pleasure because I regard it as setting the seal for the time being on the success of the policy which we decided a few years ago to pursue.

Mr. T. WILLIAMS

I should like to make one or two observations on this fairly considerable Estimate. I notice that the increased sum required is approximately half a million pounds. One of the big things that we expected, when this policy was first commenced, was that, in the first place, we were going to provide a good deal of employment—that we were going to divert from our cities into the countryside quite a large number of workpeople. I should like to ask the Minister if any estimate has been obtained, in view of this increased production of sugar beet, of the increased number of rural workers that have been employed because of the development of the sugar beet industry. Yesterday, in reply to a question, the right hon. Gentleman said that, as far as he knew, not one acre of land had been brought into cultivation as a result of the development of the sugar beet scheme.

The MINISTER of AGRICULTURE (Mr. Guinness)

I think the hon. Member cannot have misunderstood my answer. He asked whether the arable acreage as a whole had increased, and I said I was pretty sure not. As a matter of fact, it is well known that in certain counties, on rough land, a lot of gorse has been ploughed up, and has increased the arable acreage; but that is very different from the wider question that he asked yesterday.

Mr. WILLIAMS

I am very pleased to hear the right hon. Gentleman make that statement. It is some small consolation to those of us who felt that the expenditure of a very large sum of money had not in the aggregate increased the numbers in a very healthy and useful occupation. In view of the number of workers who have been displaced, however, there will be a balance on one side or the other, and perhaps the right hon. Gentleman will tell us, before this Vote is finally carried, what exactly, as far as he can estimate, has been the net result of the transference or diversion of labour from towns to cities, and what the net result is with regard to unemployment in this country. The hon. and gallant Member for Rye (Sir G. Courthope), who has had such a lengthy and honourable record in the development of this new industry, told us that this Supplementary Estimate is exclusively due to the exceedingly large production of sugar beet per acre, and the sugar content of the beet produced. He told us that those who had been producing sugar beet had been in the habit of producing seven tons, or slightly more, per acre, whereas, during the last season, many producers were producing 14, 16 and 18 tons per acre. That does, of course, change the financial position of this scheme, and it changes the financial position of each farmer. Although the Government are called upon to meet a much larger bill with a production of 16 as compared with seven tons per acre, the farmer, obviously, must be increasing his own balance sheet to a very considerable extent, and I should like to ask the right hon. Gentleman if this increased production by the farmer has in any way reflected itself in the wages of the work-people in the particular areas where sugar beet has been, and is being, produced. If he will tell us that the workers are receiving some slight benefit as a result of this large expenditure of public money, it would be some consolation to us, first, to see a new industry developing and, secondly, to know that public money is finding its way into the pockets of the working people.

There is another question which one would be entitled to submit this afternoon. In seeking to settle, definitely once and for all, the sugar beet industry, one would like to know whether the Government have persuaded the manufacturers of machinery in this country to manufacture the type of machinery necessary for sugar beet factories. It has been felt, and I think quite rightly, that if the industry was going to be developed in rural areas, and it was going to have the effect of causing manufacturers of machinery to specialise on this particular kind of machinery instead of our having to purchase it from abroad, there would be another avenue opened out which would provide work for British working people. In looking at the question of the employment which has been found as a result of the development of the sugar beet industry, one would like to know to what extent, if any, have British manufacturers of machinery adapted themselves for the purpose of producing this particular machinery, and to what extent has that reflected itself in increasing the number of workpeople.

The £450,600 mentioned in this Estimate is a considerable item. One hon. Member suggests that it reflects the success of a pertain policy. It certainly reflects this, that if the land which is now being used for the production of sugar beet had been used previously, without Government assistance, to the fullest extent., better results could have been obtained years ago by the people in charge of the land, and who were operating the land and did not do their best to secure the maximum value from its working. It seems peculiar that before the Government began to assist the producers of sugar beet, they were only producing seven tons per acre, but when the Government said, "We will give you a considerable sum to assist you and to stabilise your industry, then they are able to increase the produce from seven tons per acre to 14, 16 and 18 tons per acre. That is one of the things which makes some of us feel that the statements which we are constantly making that the best use has not been made of the land are justified. The best use is not made of the land when it remains for Government subsidies to persuade farmers to extract the utmost value and to provide the maximum quantity of labour. That is not a testi- menial to those people who have been in charge of the land for so long. Perhaps the right hon. Gentleman will tell us the real effect of this new industry in the increased opportunities for labour on the land, in the increased production of machinery and the general effect upon British labour.

Mr. HURD

There is one aspect of this Supplementary Estimate which, when-brought to their notice, will give some consolation to hon. Members opposite. I refer to the part which the smallholder has taken in the production of sugar beet, which is one of the reasons for the Supplementary Estimate. The hon. Member for Hillsborough (Mr. A. V. Alexander) is, in general, a cheerful controversialist. I believe he is making a special effort just now in connection with the organisation with which he is associated, to bring it more closely into touch with agricultural interests. I am sure he will I not despise a movement which as represented in this Supplementary Estimate has saved from starvation many smallholders as well as many farmers during the past season. That aspect of the question is worthy of his attention, representing, as he does, one of the small parties in this House and outside opposed to the policy of the Supplementary Estimate. I hold in my hand a petition which has been sent to me by smallholders in my constituency.

Mr. HARRIS

On a point of Order. Shall we he allowed to discuss the policy of helping smallholders in this country?

The DEPUTY - CHAIRMAN

That would not be in order on this Vote. I do not think the hon. Member is doing that; he is only referring to the increased production of sugar on small holdings.

Mr. HURD

These smallholders, who have been growing sugar beet under the money contained in this Estimate, have sent me a petition expressing their extreme anxiety as to their future. They have been encouraged by this House, and the Committee to-day is going to implement that encouragement, to grow sugar beet. They want to know whether it is not possible for this House to complete this policy by insuring them a market for their sugar beet.

The DEPUTY-CHAIRMAN

I do not think we can go into that.

Mr. HURD

This money has been partially applied to the encouragement of factories, and, if I am within your Ruling, I should like to point out that it would have been even more satisfactory had it been decided to apply it also to smaller units as well as the larger units of factory production. I do not want to trespass, but it is difficult to bring one's remarks exactly within the ruling. Here we have a substantial sum of money which is being voted by Parliament for the encouragement of sugar beet. I wish the Minister to consider whether, in the use of this money, he might not have been more wise to have remembered the small as well as the large unit of manufacture. We have just passed an Act directly to encourage the small man on the land to enable them to own a little bit of England, and this Supplementary Estimate has been of the greatest value in pursuit of that policy. I want the Minister to look at this question of sugar beet from the point of view of the smallholder, and to realise that by means of this Estimate we have helped a large number of these small men to become better established on the land, and that by pursuing that policy which is represented in the Estimate, we might go still further and do what this House and all parties of us desire to do, namely, to get more small men on to the land, thus enabling them to make a living for themselves and their families.

There is a number of other points with which I would have liked to deal, but it is extremely difficult to bring them within the ruling. I am certain that the policy represented in this Supplementary Estimate is a policy of the highest value from the point of view of arable production in general, and especially from the point of view of smallholders.

Mr. ALEXANDER

What do your petitioners ask?

Mr. HURD

They ask me to use my influence with the National Farmers' Union, the Ministry of Agriculture and this House to induce this House to make the sugar beet subsidy based upon a smaller unit of production. There is the production of motor fuel.

The DEPUTY-CHAIRMAN

The hon. Member must deal with that on some other Vote.

Mr. HURD

The Minister has been good enough to look at some aspects of this question in regard to the smaller unit, but, unfortunately, he has looked at it from under the shadow of existing vested interests. He has not gone into the question of the smallholders' relation to sugar production from a detached and entirely dispassionate point of view. He has allowed himself, rather, to be influenced by those who are thinking of existing combines anal large vested interests. I am sure that is wrong. Sugar beet as affecting the smallholder is a question well worth consideration, quite apart from the existing interests, and to see whether we have not in this a means of increasing arable production by means of the small man on a farm, which would be of the highest value in pursuit of the policy to which this House has committed itself. I commend to my right hon. Friend a review of the whole question in a new light, so that we may, if we can, give the smallholder new hope in this country.

Mr. HARRIS

I am very glad to say that, to a limited extent, I agree with the hon. Member who has just sat down. I agree with him that, if there is any money to be given from the State, it should go to those who best deserve it, and if this system of subsidies is to be carried on, the money should go to the smaller units of production, and not to helping existing vested interests. With that principle I am in general agreement, and if the hon. Member desires to promote a Bill in order to bring in the smaller units of production, I should not be able to differ from him. I am glad to see that the Financial Secretary to the Treasury is present. The Financial Secretary is the last person to defend Supplementary Estimates. It must add to his worries and troubles, and it must make the task of the Chancellor of the Exchequer, which is difficult enough at all times, more difficult and more tiresome to carry out. Under the ruling from the Chair, we are not able to criticise the principle of the policy underlying this Estimate, but to look at it merely from the point of view of a Supplementary Estimate.

Here we are, at a time of great national crisis when the country is already overburdened with taxation; when we are threatened with increased taxes, when the national Budget is not likely to balance, and we are coming down here to dole out money to a favoured interest. If any hon. Member opposite can defend that principle and policy, I shall be very much surprised. Of course, hon. Members from agricultural districts are going to get certain favoured interests developed, and consequently they will be in favour of the Estimate; but I do think the Minister of Agriculture will have to explain a good deal to the Treasury as to his bad estimating in this particular case. If he is going to come down and ask for a favoured section of the agricultural interests to have national money, lie ought to be able to calculate more closely what it will cost. We were only persuaded to vote this money on the understanding that it was only by giving this particular subsidy to the beet sugar industry in its early days that it could be made to pay. Now it is clear from the facts that the yield per acre is so much larger that it would have been possible to come to the House and ask for a very much smaller rate of subsidy. It would have been playing fairer with Parliament and the nation to ask Parliament to reduce the subsidy rather than to bring forward a Supplementary Estimate. The Government might very well say to the farmers, "We were misled. This is a paying proposition." We have been told by one hon. Member that sugar beet can be made to pay. The Minister of Agriculture explained this away by saying that, owing to a greater yield per acre and to the advantage of the experiments made in Holland and other countries, not so large a subsidy is necessary. In the interests of the taxpayers, it would be fairer, therefore, to reduce the subsidy rather than to ask for a Supplementary Estimate.

The fact is, the whole system of subsidies is vicious, bad and unsatisfactory. No Minister can defend it in principle. Why sugar should be particularly singled out for favour, I do not know—the only explanation, I suppose, is because it is sweet—but this and other—

The DEPUTY-CHAIRMAN

The hon. Member is now embarking on the general question of subsidies.

Mr. HARRIS

I am quite prepared to act within the limits of your ruling, Captain FitzRoy, but when I see the vicious results of a subsidy it is very difficult not to make a protest. When we spoke against this subsidy, we anticipated this sort of thing. We said that, once you started on these lines, you would constantly have Ministers asking for Supplementary Estimates for more money from the already over-burdened taxpayers, including the people in the towns, who will not get any benefit from this. In my district many people are out of employment; they cannot get any subsidies from the Government, and they will have to pay.

The DEPUTY-CHAIRMAN

I told the hon. Member just now that he was embarking on the question of the subsidies, and he is doing so again. I hope he will not go on with that.

Mr. HARRIS

I quite see the difficulty. It really is rather difficult, when Parliament is asked to vote large sums of money, and we are not allowed to discuss the principle which has brought about these extra charges.

The DEPUTY-CHAIRMAN

There is a proper occasion for everything. A separate occasion is set apart for discussing this very question which the hon. Member wants to debate now. The only point is that this is not the occasion on which to discuss it.

Mr. HARRIS

If we are not allowed to discuss the general principle of subsidies, may I ask whether the Minister of Agriculture is satisfied that next year there will not be a still further Supplementary Estimate; whether, owing to a greater yield and the extension of acreage, he will be able more closely to estimate the result of this subsidy, or whether it is going to be a mere gamble. Will he be able to go to his Finance Minister, as a result of his policy—

Lieut.-Commander BURNEY

Before the Minister of Agriculture answers that question, will the hon. Gentleman tell the Minister what the weather is going to be next year.

Mr. HARRIS

I entirely agree that agriculture is a gamble. With good weather you make good prices and profits; but if the Minister is going to take up the line of baying to compensate farmers for bad weather, where are we going to end? If that be his policy and the policy of Members opposite in regard to agriculture, I am sorry for the Chan- cellor of the Exchequer. This policy is bad, it is wrong in principle, and will sooner or later be a heavy charge on the Exchequer.

Mr. KIDD

I intervene only in order to express the hope that we may get some information why sugar beet growing has not been taken up so enthusiastically in my part of Scotland as in other parts of the country. In regard to my own part of Scotland, I was encouraged to hope, from a remark of the hon. and gallant Gentleman the Member for Eye (Sir G. Courthope), who opened this discussion, that perhaps that period of caution might now be brought to a conclusion. The hon. and gallant Gentleman seemed to have very gratifying information which was a complete vindication of this system. He indicated that any reduction in the subsidy in England would be more than balanced by the increased value arising from the greater production per acre plus the increased yield per ton. I am not forgetting the weather, and I have no wish that the Minister of Agriculture should gamble in respect to that; but I wonder, having regard to the diminution in the amount of the subsidy, whether the data already supplied by his experts and the information coming from any other quarter, taken in conjunction with the results of our own experience, would justify more than a hope that sugar beet growing can now be regarded as a success; and that once we have become familiar with it, and have got greater knowledge through its cultivation, there will be every justification for the farmers of this country taking it up in good earnest.

I could not follow one argument of the hon. Member for Hillsborough (Mr. A. V. Alexander). He has had a very large experience, as representing in his daily life the greatest consumers of sugar in this country. The hon. Gentleman said that this year we had imported more sugar and we had raised more sugar at home. He discovered in those two facts, taken together, some explanation, which I could not follow, for some displacement of employment.

Mr. ALEXANDER

My point was that you have got a larger percentage of imported refined sugar and that the gain on home-grown sugar has been at the expense of British refined sugar.

Mr. KIDD

I understand now that the hon. Gentleman was distinguishing between the quality of the sugar and not the volume of the sugar. I think he will agree with me that if a greater volume was imported and a larger volume was produced, it would be rather difficult to discover in those two facts any reason for displacing employment. I quite understand that everything appertaining to agriculture is, ultimately, a gamble, and I am not discussing that, but I ask the Minister—for the guidance of large areas where some new agricultural development will be of the greatest advantage to all engaged on the land, whether as farmers, smallholders or ploughmen, and for the guidance of those districts which had been ultra-careful and almost selfishly careful up to this point—if he can give an indication that from our experience plus the knowledge available from other sources to the Ministry, we may now regard ourselves as having arrived at the stage when sugar beet growing under normal conditions has been proved to be a new departure on which the agriculturist may embark with at least as large a measure of confidence as he would embark on the growing of wheat.

Mr. J. JONES

I cannot pretend to speak with the same amount of authority on the production of sugar-beet as agricultural persons generally and eminent lawyers from Scotland; but I represent a constituency which happens to be the centre of the preduction of sugar in Great Britain. Messrs. Tate and Lyle happen to be the largest firm of this kind, not merely in this country but in the world, and they have built up their business without a subsidy. I am not an advocate of private enterprise, generally speaking. I believe that all these problems could be solved by the nation solving its own problems and taking control of its own possibilities. This particular section of industry has been subsidised at the expense of the State, the Government have advanced a large amount of money for the purpose of assisting sugar-beet. We do not object to the agricultural districts of this country being developed to their fullest possibilities; the land in this country has never been cultivated as it ought to have been done, and to that extent we are all in favour of this. The only question is the method of doing it. We are told now that the Government are prepared to subsidise the beet sugar industry to a further extent to the amount of £450,000. That is a local charge and not a national one, in the real sense of the term. An hon. Member, speaking just now, spoke of the little man, but what about those who have established an industry representing millions of capital? They cannot get anything except competition, and within the next 20 years, for example, 10 factories paid for by the Government will be handed over to private enterprise. You are subsidising private enterprise in industries at the expense of industries already established.

The DEPUTY - CHAIRMAN

The remarks of the hon. Member refer to the general question of subsidies, hut this is only the fulfilment of an obligation into which the House has already entered. The granting of this extra £450,000 has nothing to do with the principle of the subsidy; that the House has already agreed to.

Mr. JONES

I beg your pardon if I dispute your ruling, to point out that this £450,000 is part of the money we have to pay for subsidies. It is only a development of the same case. I am pointing out to you that during what is called the off-season in the sugar-beet industry thousands of men in London, Liverpool, Greenock, and other parts of the country where the sugar-producing industry exists, live without subsidy and are thrown on the streets for six weeks at a time in order to pay for the subsidy to the sugar-beet industry. That is not fair play. If there is to be a subsidy, let there be one all round: but you simply subsidise one side and leave the other side to live on its own exertions.

The DEPUTY-CHAIRMAN

The hon. Member is again referring to a principle which the House has already accepted, that of subsidising the industry. He must deal with the £450,000 which is the result of the action of the House.

Mr. JONES

I thank you. Captain FitzRoy, again, but I want to say that, as far as my own constituency is concerned, this has meant the shooting out of 800 workmen for six weeks periodically, because the factories cannot be kept going owing to the competition of the subsidised factories. They are engaged in the production of sugar-beet from all parts of the Empire—"Buy British Goods"—

Mr. HURD

Was that due to the coal stoppage?

5.0 p.m.

Mr. JONES

You know that the sugar-beet industry is a seasonal one, and that it is only at certain times of the year that the factories are able to operate. During that time they produced as much as ever they could. But then the workers in Silvertown and Liverpool and Greenock were thrown out of employment because of these subsidised factories. We have never asked for a subsidy. You are giving subsidies to these particular factories and in ten years from now 20 factories are going to be handed over to the subsidised companies. Twenty Government paid factories, and this £450,000 is simply a payment of the interest upon the capital they have invested in the subsidised factories. A subsidy was wrong in the mining industry. The Government denounced a subsidy to the mining industry up hill and down dale.

The DEPUTY-CHAIRMAN

The hon. Member is still touching on the general principle of a subsidy. That does not arise upon this Vote at all.

Mr. JONES

Thank you very much. Having got in all I want to say, I thank you, Captain FitzRoy, for allowing me to say it. All I want to say is that those of us who represent constituencies in which the sugar industry has been built up, wish to protest as strongly as we can against this kind of subsidised competition. The men who have built up the sugar industry protest against being put on short time and stopped from working altogether. Knowing full well that the beet-sugar factories cannot be kept going without a Government subsidy they protest emphatically against being thrown out of work while other people are kept in work by Government money.

Lieut.-Commander BURNEY

I hope the hon. Member will not expect me to follow him in his speech because I am afraid I should be ruled out of order if I did so. In fact, we find it rather harder to keep within the bounds of order this afternoon than a camel finds it to go through the eye of a needle. But I should like to ask the Minister of Agriculture one or two questions in regard to the sugar beet industry. I understand that the reason for this Supplementary Estimate is because the quantitive results given by the sugar beet industry have been very much better than was estimated. I think all the Members of the Committee are very glad that that is the case, and it would seem also that this Estimate is due to the fact that the financial return given by the industry is also better than was expected, and, therefore, more and more firms are going into it and more and more land is coming under cultivation. Therefore, I think one is entitled to ask—and this backs up the question put by the hon. Member for Linlithgow (Mr. Kidd)—the Minister of Agriculture if he can give us some details and some of the reasons that have increased the technical efficiency of this industry so that the Committee as a whole can make up their minds and ascertain whether or not, the experiment which the Government are making in giving this subsidy is likely to meet with success, because, in asking the Committee to pass this Vote, one has got to realise that this £450,000 is, of course, a part of a much bigger gamble. If that money is to be of value to the State, and we shall only be able to know whether or not it is of value to the State not this year but in some years to come, we must find out whether or not the industry is likely to be established upon an economic and self-supporting basis. It will help not only Members of this Committee but many agricultural interests outside to know what are the opinions of the Minister of Agriculture as to the technical improvement in the industry for the past year, and the possibility of that technical improvement being continued for the coming year. As I understand it at present, 40 per cent. of the sale price of the sugar is paid for by the subsidy—40 per cent. of the price received. Accordingly, therefore, before the industry can come on to a self-supporting basis without a subsidy the costs of production will have to be reduced by 40 per cent.

Mr. BARNES

By half.

Lieut.-Commander BURNEY

I under stand the average sale value of sugar is some 30s. per cwt. and the subsidy is 19s. 6d. per cwt., and accordingly the figure one has to take is 49s. 6d., of which 19s. 6d. is about 40 per cent.

Mr. BARNES

Then the duty must come off that.

Lieut.-Commander BURNEY

That is a matter which I should like to ask the Minister of Agriculture to clear up. As I understand it, 40 per cent. of the price received by the factories to-day is a grant-in-aid by way of a subsidy, and therefore, before the industry can be made really self-supporting without drawing upon the National Exchequer the costs of production will have to be reduced by 40 per cent.

Mr. A. V. ALEXANDER

May I put it this way? The home-grown sugar is paying a duty. On the other hand, exactly the same preference is given to the factory, and the duty which is paid in the retail price of sugar at the factory is over 11s. as compared with the Excise Duty charged of something over 9s. The hon. Member wants to add another couple of shillings in order to get the actual ratio.

Lieut.-Commander BURNEY

Perhaps the Minister of Agriculture will have it worked out accurately, but it will be about 44 per cent, if what the hon. Member says is correct. We have heard this afternoon that the yield per acre has increased from 7 or 8 tons per acre up to 16 or 18 tons per acre in special cases. I should like to know from the Minister of Agriculture what is the average yield to-day over the whole country, what was the average yield over the whole country last year, and what is the average yield in Holland to-day? The second question which is of equal importance to the actual tonnage of beet per acre is the sucrose content of the beet, and I understand that has risen in this country to 17 per cent., whereas in Holland I understand it is something like 19 per cent There again I think I should be grateful if the Minister could say the average yield of the sucrose content over the whole country this year, and again what it is in Holland, because upon those two factors must depend the actual return which the farmer can get from growing his beet.

Then, again, it would be interesting to know whether there are any developments which are likely to give us in the near future a greater yield per acre of the sucrose content than has been obtained up to date in this country or abroad. The other question which seems to be of importance is the question of the factories themselves. As I understand it, the factories only run for four months in the year and, accordingly, therefore, the overhead charges of the factories are not only heavy—

The CHAIRMAN (Mr. James Hope)

The hon. and gallant Gentleman is now going rather far from this Supplementary Estimate of £450,000. His argument seems to be more relevant to the main question than to this particular Supplementary Estimate.

Lieutenant-Commander BURNEY

If I may be allowed to explain the matter, I was pointing out that the reason for the increase in the subsidy is because the industry has been more profitable and has, therefore, attracted more persons to work in the factories and more persons to grow sugar beet, and, therefore, I am asking the Minister of Agriculture whether he can indicate to the Committee whether it is the technical improvement which has given the industry this fillip and which has necessitated this Supplementary Estimate, and it was upon that basis that I asked for this information. If I am in order, I will proceed on those lines. I understand that there is a possibility of a considerable reduction in the cost of the extraction of sugar from the beet if a continuous process can be evolved and that would reduce the overhead charges at the factories to one-half of what they are now. I further understand that considerable experiments have been going on in that direction and it would be interesting to know whether the Minister can give us any information as to whether those experiments have been successful and what are the possibilities of obtaining a continuous process factory.

Mr. GUINNESS

They are continuous process factories.

Lieut.-Commander BURNEY

The Minister says that they are continuous process factories, but, as I understand it, they only operate four months of the year, because the beet has to be treated within a few weeks of being gathered. There is a process which enables the beet to be cut and dried and then to be stored for a year or more, and a factory of one-third of the size only would be able to deal in those circumstances with the same output as an existing factory. That would necessarily reduce the capital cant of the factory, and the standing and running charges thereof, and it would get rid or the main difficulties of the labour situation. That is of great importance when we are dealing with the consideration of whether this £450,000 is likely to give useful results or not in putting the industry on a permanent economic basis and anything which can be done to throw light on that question must be of very considerable value not only to Members of this House but also to agricultural interests throughout the country. I hope the Minister of Agriculture will be able to answer those questions, as I have put them with the idea of trying to assist the industry so far as is possible by letting persons know whether or not the establishment of beet growing gives indications becoming a permanent industry in the districts in which they live by pointing out what the yield per acre may be in the future.

Sir JOHN SIMON

This Supplementary Estimate is for a very substantial sum of money, very nearly half a million, and I appreciate that it is only one of a number of such demands upon the taxpayer as we may expect from time to time under the Act of Parliament passed in 1925, because, if I understand rightly, Parliament has already been induced to agree, by the Statute of 1925, to a scheme under which it is contemplated that subsidies calculated on a particular basis will continue for no less than 10 years. Of course, I appreciate that in this Estimate to-day, the policy of that Statute is not open to discussion, but I am, I think, in order and it appears to me it is relevant to call attention to the statement which the Minister of Agriculture made when he presented this Supplementary Estimate to the Committee and recommended it to the Committee in his speech yesterday. The right hon. Gentleman the Minister for Agriculture, in asking for this very large sum of money, said: This money, which the Committee is asked to vote to-night, is evidence of the success of a policy which was adopted with the general agreement of all parties."—[OFFICIAL REPORT, 15th February, 1927; col. 844, Vol. 202.] It is true there were persons in all parts of the House who were in favour of the policy, but it is also true that there were critics to be found in more quarters of the House than one. But, I want to ask the Committee seriously to consider what this claim of the Minister of Agriculture really involves. He commends this demand on the British taxpayer to the Committee on the ground that it is a measure of the success of the policy of the Government in this matter. What an extraordinary thing at this time of the day to say to the British taxpayer "If I was only able to demand £5,000,000 my policy would be ten times more successful than if I only demanded £500,000." While it is true that Parliament in 1925 did pass the Act, at the same time it is entirely within the competence of the present Committee to decline to vote this very large additional sum.

Parliament, no doubt, by passing the Act, must be taken to have expressed a policy which stretches into the future for ten years, but in the end the control of this matter rests with the House of Commons in Committee of Supply, and it is therefore by no means the case that this Committee is called upon to endorse the proposition that the more the Minister of Agriculture calls upon the House of Commons to make the taxpayers of the country raise in connection with beet sugar or any other subsidy the greater is the triumph of the Government's policy. I am quite unable to subscribe to that doctrine. It appears to me on the contrary that the prime consideration which shoal move Members of the House is to protect the British taxpayer against this additional demand which in the circumstances threatens to become larger and larger. I wonder very much whether in some future Committee' of Supply we shall have the Minister coming forward and saying he is now able to record a further triumph on the part of the Government and its policy, for he is now able not merely to demand £500,000 more than lie expected but £1,500,000. I am quite aware that as against this have to be set the proceeds of the Excise Duty on sugar and molasses manufactured from beet grown in Great Britain, but I would ask the Committee to observe what the broad figures are as disclosed in the details of the present Estimate. If I follow it rightly, for the year 1926 we were originally presented with an Estimate for a subsidy of £2,750,000. The right hon. Gentleman now says "That is not enough and I want very nearly another £500,000, making £3,200,000." As against that apart, of course, from the undoubted effect of subsidising in this way certain beetroot factories, what the State is receiving under the head of Excise Duty is apparently just £500,000, so it appears that the Minister, when taking great. credit to himself and to the Government for being so successful, is, as a matter of fact taking up the position that we shall be able to judge how much more successful the policy of the Government is from period to period and from year to year in exact proportion to the additional amount of money the British taxpayer is asked to find.

Mr. HILTON YOUNG

if I understand the right hon. Gentleman's argument, it is that this business is a failure in proportion as it is expensive to the Brtish taxpayer. If that be so it is a success in proportion as it is the reverse, and not expensive to the British taxpayer. If that be so, you can measure the success of the scheme by the smallness of the amount of beetroot it produces. The right hon. Gentleman's ingenuity has surpassed itself. It appears to me taking things in a humble commonsense point of view, listening to the Minis the that his argument was that we might derive consolation from the fact that. our pockets were to be affected to the extent of another £500,000 by these successful results, that more acreage was under beetroot, that more beetroot was being produced per acre and that each little beetroot is containing more sugar than it used to. Anyone passing over the railway line in my part of the country and seeing the large trucks piled to the roof and over with this new product of our soil cannot but find that an encouraging sign. Since the Debate seems to be drawing towards a conclusion there are two observations that fall to be made on the form of the Estimate. In the first place this is the first Supplementary Estimate with which we arc dealing in which there has been an allocation from the Civil Contingencies Fund. On such an occasion I think we have always to remind ourselves that this is the method by which the real limitations of a scheme of appropriation laid down by this House are relaxed in favour of a spending Department. It appears to me that in this case the allocations from the Civil Contingencies Fund were quite legitimate. There is no novelty in the purpose. It is only an increase in the amount for which the new funds are required. Nevertheless, it is a matter which requires the most careful examination on the part of the House, and I might perhaps ask the Minister what is the amount of these allocations, whether the whole amount is to be paid in the course of this year and whether the circumstance of the probable excess expenditure was taken into account in the preparation of the Supplementary Estimate at the earliest possible moment. There is another point to which attention should be called. This is another case in Which, owing to the manner in which we keep our accounts, the total of our Estimates is artificially swollen. We pay out a subsidy with one hand and collect the Excise Duty with the other. I think it right in this case to do so. It marks the temporary nature of the subsidy and keeps the machinery of the Excise in working order against the time when the subsidy will be discontinued. Nevertheless, the effect of this is to swell the Estimates this year by £1,000,000, though really that is set off by other amounts. The Committee will find encouragement there again, by realising that the net increase is not£450,000 but only £300,000.

Mr. W. HIRST

I should like to ask what administrative oversight is exercised in the expenditure of this money. I look upon the figure of £500,000 as being a large one which will require more explanation than we had from the Minister yesterday. There was a statement in the Press two or three days ago regarding one of these sugar beet factories and the chairman, in presenting a statement to the meeting, furnished in glowing terms a report of the year's working of the factory. It seems to me the Minister would be well advised to take into account the prosperity of some of these places and I join with the hon. Member for Silvertown (Mr. J. Jones) in asking that if you are going to have a Supplementary Estimate you should receive something with regard to Excise Duty on the sale of these two articles. It would be much better from a Departmental point of view to say that where a profit has been made you should ask for some contribution towards liquidating the amount of subsidy that is involved. I am definitely opposed to the spending of public money without having some proportionate amount of control over it.

The CHAIRMAN

I think this will involve an amendment of the Act of 1925 and it is therefore not in order.

Mr. HIRST

If these firms get more prosperous as the years go on under the subsidy would it not be possible for the Minister to say to these people, "We came to your help in your time of need"? I am not complaining at all about that. I think we have a right to try to set up any department of agriculture which is going to be for the benefit and the well-being of the community as a whole, but when these firms get past the borderline of requiring the assistance of the State in their days of prosperity they might come to the aid of the Minister, not only the Agricultural Department, but the Treasury itself, which is perhaps equally important. A previous speaker suggested that the establishment of the sugar beet industry had put money into the pockets of the workers. Whether that is so or not we seem to be putting money into the pockets of those who are exercising administration over these Departments. I wonder if the right hon. Gentleman would help us in that direction, that when the time comes and prosperity is attained we shall get something from these people which will not only help to put the Minister of Agriculture in a really strong position in the country, but will place the Treasury in a healthy position also.

Mr. GUINNESS

A great many questions have been asked. Some of them were ruled to be out of order, and I hope the Committee will understand that it is not altogether easy to answer a Debate which has caused so many breaches of the rules of the Chair. The Debate has, I think, taken a much wider scope than is really justified by the Estimate, because we are absolutely bound by legislation to honour the agreement which was come to the year before last, on the strength of which capital was found for the factories and farmers were induced to make contracts for the growth of sugar beet for two and three years. That, I think, is the answer to the right hon. Gentleman the Member for Spen Valley (Sir J. Simon) and the hon. Member for South-West Bethnal Green (Mr. Harris) when they suggest that, instead of coming to the House for more money, we ought to bring forward proposals to reduce the subsidy. I do not suppose those hon. Members themselves, when they realise what is involved, would seriously propose that such a contract, entered into with the general consent of all parties, should be cancelled in an arbitrary way as has been suggested to-day. A great risk was taken by those who put up the money for the factories, and I think it would be most unjust to deprive them of that subsidy upon which they have counted.

Mr. HARRIS

The right hon. Gentleman says there was a great risk. Has it proved a risk? Is it not a very profitable transaction?

Mr. GUINNESS

A factory in my own constituency last year made a loss of something over £60,000. But this is the period of high subsidy, and after the forthcoming season they will have to rearrange their system so as to carry on with 6s. 6d. less in the way of subsidy than they are now receiving.

Sir FREDRIC WISE

Would it be possible for any new factories to have the subsidy altered or reduced?

Mr. GUINNESS

It certainly would not under the existing Act, because the Act offers this subsidy to all corners. I think it would be very much against the interests of the industry that we are trying to establish at this time, when we are hoping for some result of these experiments, if we were to make any change in the system. The hon. Member for Uxbridge (Commander Burney) asked about what he caled the continuous process, meaning a process which would go on all the year. Generally speaking, in this connection, the application of the term "continuous process" is to a factory where they start with the beet and end with the refined sugar, and in that sense all but one of our factories are working on continuous process. But the hon. Gentleman was using the term in the sense of a process which will dry the sugar at one time of the year and enable manufacturing to go on through the 12 months. As he knows, experiments have been made in that direction. The Government built a factory which has now been sold to a company that is working it. I think it is very important, from the point of view of the permanent production of beet sugar in this country that these small factories should be made possible. I, have a great deal of sympathy with what was said by the hon. Member for Devizes (Mr. Hurd) about the hard case of the smallholder who cannot get a factory to take his beet. If we are to get a satisfactory method on the lines of the factory established at Eynsham, which takes the tonnage of 2,000 acres against the 10,000 acres of the large factory, that would enable new industries to be started in many areas which so far are not -able to make the necessary arrangements.

Mr. PALING

Is the small factory referred to actually proceeding on the scale suggested on the continuous process through the year?

The CHAIRMAN

I think I ought to intervene. Would this development make a difference to the subsidy? If not, it cannot be pursued here.

Mr. GUINNESS

This new factory is receiving some of the additional money which is being voted, but it is only just lately that it has beer sold to a company and has entered into production. The right hon. Member for the Spen Valley and another hon. Member considered that we ought to re-open the question of assistance to new factories. The hon. Member who spoke last said that, seeing the profits that are made by the factories, we ought to take control of the profits and ensure the public getting a share. The public is getting its share of the advantage of creating this new industry at private risk. It is fully evident that those who are asked to put their money into this industry are not very well satisfied, at the present time, as to the probable results when the subsidy comes off, because only a week or two ago a new issue, was made and about 90 per cent. of the capital was left on the underwriters' hands. Judging by that kind of evidence the State has not offered higher terms than were necessary to get this industry, involving a very large risk, established in this country. The right hon. Member for Norwich was concerned at the breach in the form of our financial business which was involved by borrowing from the Civil Contingencies Fund, owing to the looseness of our Estimate. I explained yesterday why it was that we cannot get to a closer figure. As a matter of fact about £300,000 comes from the Civil Contingencies Fund, and this is the first opportunity we have had for laying a Supplementary Estimate which will make good that deficiency. We shall, of course, do our best to get, the closest possible figure next year, but from the nature of the thing it is impossible, with the greatest precautions, to make a very close estimate.

Mr. H. YOUNG

Will the whole amount that is borrowed be repaid this year?

Mr. GUINNESS

Yes, the whole wilt be repaid out of these votes which we are now taking. The right hon. Member for Northern Norfolk (Mr. N. Buxton) asked what was the effect on wages of this increased subsidy. Of course, it is impossible to trace any direct result. The argument was developed yesterday that in return for this subsidy the farmer ought to be in, a position to pay a higher standard wage than previously. The answer to that argument is that most of the work in connection with sugar beet is done on a piecework basis, and, apart from that, only a very small proportion of the total arable area is under sugar beet at one time. I have had figures taken out for 10 administrative counties which grow the heaviest proportion of the crop, and even there sugar beet is now only representing 2.1 per cent. of the cultivated area. It would be quite impossible to base on only a 50th part of your cultivated area any general increase in the standard wage on account of sugar beet. But hon. Members opposite can feel satisfied that labour is getting its share, because its workers are earning in the county I represent, where there is a great deal of sugar beet grown, from 40s. to 50s. a week in this seasonal work, and, as they know, that is very much in advance of the ordinary standard agricultural wage.

Mr. ALEXANDER

I take it that that is confined to the two operations of thinning and lifting.

Mr. GUINNESS

It is thinning, singling, hoeing and lifting. It is not only the casual worker who is paid at these time rates, but also the man permanently employed on the farm who is looking after the labour, and naturally enjoys the same advantages.

Mr. T. WILLIAMS

How many hours are they working for the 40s. to 50s.?

Mr. GUINNESS

I really could not tell the hon. Member. The total varies. This did not happen in my own county, but I know that in the early days of the sugar beet, when it was being grown in Norfolk, the local workers did not feel inclined to work the long hours that were being worked by the Dutch who had come over in order to show them how to carry on this new industry. The Englishmen knocked off earlier. When they came back they found that the foreign workers had been continuing at work throughout Sunday. The English workers said: "It is a. monstrous thing that you have gone on working like this. We do not think it right to work on Sundays." Their answer was: "Almighty God lets the weeds grow on Sundays." In other countries where sugar beet is grown there is every reason for great pressure of work during the season. The hon. Member for Hillsborough (Mr. A. V. Alexander) was very gloomy as to the future of this industry. He was convinced that it would not be possible for the industry to stand any decrease in the subsidy, and said that any reduction in the farmers' receipts would inevitably be reflected in the wages. That was a very interesting statement from him, because I understood him to make the valuable admission that the farmers are now paying as much as they can afford out of this high subsidy. I think there is no doubt that, unless we can improve the methods of cultivation and hence the yield and the sugar content, the industry will not be able to carry on with the same prosperity to the three parties concerned.

Mr. ALEXANDER

The right hon. Gentleman does not want to misrepresent me. What I did say was that if the argument of the hon. and gallant Member whom I followed held good, what became of the claim that the development of the industry would mean higher wages?

Mr. GUINNESS

The hon. Member said that any reduction would mean an inevitable decrease in wages. I think he used the word "inevitably," for I took a very careful note of it. Surely that must mean that the farmer is paying all that he can pay now; otherwise a. reduction would not compel him to pay less.

Mr. ALEXANDER

You will see what I said in the OFFICIAL REPORT.

Mr. GUINNESS

I believe that the increase in yield in sugar content which has shown itself may well make up for the loss of the subsidy next year, and may enable high wages to be paid, even as they are paid now in Canada. In Canada, wages are much higher than in this country, and that is possible there because the yield of sugar beet has reached 11 tons per acre on the average against the 8.7 tons per acre which we estimate will be achieved this year in this country. The hon. and gallant Member for Uxbridge (Lieut.-Commander Burney) asked about the yield in various years. In 1925 we got a yield of 7.8 tons per acre, and the yield for 1926 is estimated at 8.7 tons per acre. The sugar content last year was 16.36; this year we hope it will work out at about 17. He also asked about the yield in Holland. Holland happens to have the highest yield of any country, and in the last year for which the figures have been published they achieved 13.4 tons per acre. The hon. Member for Don Valley (Mr. T. Williams) spoke of a yield of 17 tons per acre, but I think he must have been confusing yield with sugar content.

Mr. T. WILLIAMS

No, I merely repeated a statement made by an hon. and gallant Member on the other side, who gave figures of 14, 16 and even 18 tons.

Mr. GUINNESS

I think there must be a misunderstanding. The hon. Member for Don Valley asked whether this industry was causing any increase of employment. There again we have no accurate means of measuring, hut we do find, in the returns which are made on 4th June every year, that on the 4th June, 1926, there was an increase of 14,000 regular workers compared with 1925, and I do not think it is unreasonable to attribute a good deal of that advance to the new suger beet industry. Of course, sugar beet is only one crop in the rotation and it is impossible accurately to estimate the amount of labour which may be due to it; but I think the hon. Member would be quite safe in saying that in the Eastern Counties and in the purely arable areas, a good deal of land would have gone out of cultivation and there would have been a great loss of employment had it not been for this new possibility in agriculture.

Mr. WILLIAMS

Do the 14,000 extra workers in rural areas include the workmen employed in the beet factories?

Mr. GUINNESS

No, the figure refers to purely agricultural workers and is taken from the returns which are furnished every year by farmers. I was just coming to the question of the factories. The figures there should also be credited by the hon. Member to this new industry. According to our latest returns, over and above those who are employed in producing the crops, there are 6,500 employed in the factories, and of these about 700 are employed all the year round. The hon. Member also asked a question about the employment which was given in the engineering trade in producing machinery, and he asked whether we had made any exemptions from the rule laid down in the Act that 75 per cent, of the machinery had to be produced in this country. We have made no more exemptions. When the Act was passed, the hon. Member will recall that two factories were already planned, and in connection with these, the contracts for machinery had been placed, partially abroad. Owing to these contracts, the total of British machinery was 77 per cent. of the whole, but if you exclude these two factories, you will find that in the 10 factories which have been erected under the subsidy, the amount of British-made machinery is 89 per cent. of the whole.

Mr. JOHNSTON

The right hon. Gentleman has dealt with engineering, and, I think, the figures are satisfactory, but how is it that Mr. Van Rossum and his friends are buying all their jute bags abroad?

Mr. GUINNESS

We have no control over them whatever.

Mr. JOHNSTON

You give them the subsidy.

Mr. GUINNESS

We do not give them the subsidy. Parliament entered into a contract that, under certain conditions, a subsidy would be paid. There was nothing in that contract about where any of the necessities of the industry, apart from the machinery, should be bought, and we have no control whatever over any of the commercial operations of the factories, other than the purchase of machinery.

Captain CROOKSHANK

Is it not right to say also that firms making agricultural implements have developed a great deal of new work owing to this industry, and that there has been a certain increase of employment in that respect?

Mr. GUINNESS

I think there is no doubt that there has been an increased demand for agricultural implements owing to this new industry. I was asked by the hon. Member for Don Valley whether I could say how far research had been able to improve the crop, and how I could account for the very bad result of only seven tons per acre at the start as compared with eight tons per acre at the present time—not 17 tons as was suggested. I think the fact of that improvement having been possible on the first results, does not indicate that any blame should be placed on the farmers in regard to their first attempt. When you proceed to grow a new crop in this country you have to discover by experiment the right time to sow it, the method of drilling the crop, exactly when it should be singled, and when it should be lifted. You have to find out on what soils it is best to grow it, and what fertiliser is necessary. It would be absolutely unfair to blame the farmers for not knowing all this before they had an opportunity of trying the crop. Without a subsidy to help him, the farmer obviously was not in a position to grow this crop or make the necessary experiment.

The right hon. Gentleman the Member for North Norfolk asked whether the education efforts associated with this subsidy were having satisfactory results. I think I have dealt with the question on the producing side, but I must say that, so far, I do not think the farmer is getting the full benefit which he might from the consumption of by-products. It takes a little time to re-organise the economy of a farm, and there is no doubt that we have not, up to the present, been able to adapt agriculture to the sugar-beet industry in this country in quite the same way as it has been done abroad. In foreign countries, they bring the sugar-beet back to the land. They buy the pulp at a preferential rate, and feed it to their stock. In this country that system has not been fully established, and though the factories offer the pulp at a preferential rate, I am sorry to say a large amount has been exported, because the farmers have not yet been able to consume it on the farms, and, in the same way, I hope we shall get better results when the farmers realise its value as a foodstuff.

The CHAIRMAN

I am sorry to interrupt the right hon. Gentleman, but he seems to be getting away from the Estimate.

Mr. GUINNESS

I was answering points which were raised in the course of the Debate, but I suppose I had better not stray further from the straight path. I am sure, in view of the sympathetic way in which the Committee have received this Estimate, that it is realised that we are establishing a valuable industry. We must all regret, especially at this time, any increased demand upon the British taxpayer, but I think in this case we are getting a valuable return for our money.

Mr. AMMON

I should like to clear up the point as to the figures of production which were mentioned just now. The right hon. Gentleman said the figure should be eight tons instead of the 14 tons previously mentioned. Is that correct? An hon. and gallant Member on the other side specifically mentioned a figure of from 14 to 18 tons, and when challenged from this side, he said that was yield.

Mr. T. WILLIAMS

I should also like to have this matter cleared up because the hon. and gallant Member for Rye (Sir G. Courthope) did make a statement that, whereas previously there was a yield of seven tons per acre, there were in some cases, he asserted, yields of 14, 16 and even 18 tons. It may well be, of course, that the average yield is 8 tons, and that he was referring to an isolated case here and there.

Mr. GUINNESS

The average yield is eight tons. The average yield in Holland which is the highest known was 13.4 two years ago.

Mr. WILLIAMS

Does the hon. Gentleman agree that yields of 14 or 16 tons have been produced in any part?

Mr. GUINNESS

I would not like to say what is the record yield. I think I may have, somewhere, figures as to the best yield reached this year.

Mr. KELLY

The Minister in dealing with the factories did not give us any idea as to how much of this supplementary sum is being devoted to subsiding the factories and how much is being given to the farmers. I would also like to know why people who might be employed in the factories are excluded by reason of the fact that many of the workers in the factories are employed for 12 hours and more on end, without any break, and without any opportunity for a meal. They have to snatch occasional moments in order to get a bite to eat whilst engaged in these factories in this way. One cannot understand why an industry which is subsidised—I think that was a mistake, but I would not be allowed to proceed further on that point—is unable to provide better conditions of working. Why is it necessary to employ people for 12 hours on end when we have so many unemployed? Another question I should like to ask is, why these factories should operate under a system which refuses to take into employment people classed as agricultural workers Surely in connection with the subsidised industry the agricultural workers in the district should have the opportunity of entering the factories.

6.0 p.m.

The Minister made great play with a statement of the hon. Member for Hillsborough (Mr. A. V. Alexander) to the effect that if the subsidy were reduced, the farmer would look towards wages in order to recoup himself. The Minister deduced from that statement that the farmer is paying the maximum at present out of his receipts. I do not think such a conclusion is justified. Employers, including farmers, always look to wages in order to recoup themselves if they think their profits are being interfered with, and the farmers are not paying the maxi- mum at the present time. I would ask why it is that with all this assistance we are giving to this industry the conditions are so bad, und the Minister is not endeavouring to make them better.

Sir HENRY CAUTLEY

I would like to ask the Minister a question on a point on which he gave partly an answer, but not, in my view, sufficient. He has given figures relating to the average tonnage of this beet crop, and he has also stated that the sugar content in the year 1926 shows a satisfactory increase over that of 1925. I want to ask him whether his advisers and reporters all over the country are satisfied that this increase is clue to better methods of cultivation and more knowledge of the technique, or whether it is rather due to the very much better climatic conditions that we have had during the past year. My recollection is that all the root crops have, on the whole, shown a very considerable increase. I know the climatic conditions have been favourable to the growth of all root crops, and I further know that during the autumn there has been a very great absence of frost, and very much less than we have usually had at that time of the year.

I am an intense supporter of the Ministry and the Government in this experiment. I agree with what, I think. was said by my hon. and gallant Friend the Member for Rye (Sir G Courthope), that it is in the growth of sugar beet that the arable farmer has one ray of hope in a very disastrous period put before him, but having regard to the large increase of the subsidy that is asked for I want to say a few words. I do not think it is any use disguising the figures from the Committee. I thought myself—I hope I am not right in this—that there was some fallacy in the deduction made by the right hon. Member for Spen Valley (Sir J. Simon), in deducting Excise Duty from the sum that is being asked for as a subsidy, because it seems to me that if we did not produce sugar here, we should import it, and the State would get the Customs Duty in lieu of the Sugar Duty. Therefore, we have to face the fact—and there is no use in shutting our eyes to it—that we are voting a subsidy of £3,200,000 for the establishment of this industry, and I would thank the Ministry and the Committee for this great encouragement given to agriculture in the establishment of this industry which, if successful, will have a permanent advantage to agricultural districts beyond the conception of the ordinary person amongst us.

The only other question I should like to ask is this: In order to succeed in the establishment of this industry and to get the full value of this increased subsidy, is there any condition made on the factory owners that, while the subsidy is high in these early years, sufficient should be set aside for the reduction of their capital account, so that when the subsidy diminishes, and ultimately disappears, the factory owners shall be in a position to run their factories with practically no capital costs at all? If that be so, I, for one, see no objection to voting this increased subsidy, because I believe that by that means the industry has more than a fair chance of being successfully established, and I think the Committee may vote this increased subsidy with a light heart, knowing that the ultimate good is going to be so great.

Mr. GUINNESS rose in his place, and claimed to move, "That the Question he now put," but the Chairman withheld his assent, and declined then to put that Question.

Mr. RILEY

In view of the large amount of this Supplementary Estimate, I think it would be more to the point if the Minister had given us a. little information as to the real reasons for his asking for this additional £450,000. It is quite true that in his statement yesterday he did give one or two general reasons as to why he is now asking for this extra money, hut I submit that in view of the fact that when we were entitled to discuss the policy upon which this Supplementary Estimate is based, we were only asked to consent to the payment of £2,750,000, and that we are not now entitled, in voting the £450,000, to call in question the main policy, we are entitled to a full explanation of the real reasons which have led to this enormous addition to the Estimate, which represents, as a matter of fact, an increase of 15 per cent. upon the original Estimate. In particular, we want to know the directions in which the additional money is required, In his statement yesterday, the right hon. Gentleman said: Besides the difficulty of estimating the acreage, we have this year achieved a much greater yield—about an extra ton per acre on 130,000 acres under beet cultivation as compared with last year. That accounts for some part of the increase. He went on to say: In addition to that, the demand of the factories on the Vote has been increased by the better sugar content of the crop, which this year is estimated at about 17 per cent. as against 16.3 last year."—[OFFICIAL REPORT, 15th February, 1927; col. 843, Vol. 202.] It is true there are two general directions there in which an account is given for the extra money, but it would be more interesting to the Committee if the Minister had told us what the acreage is and what was the amount of the increase due to the increased acreage and to the increased yield.

Major BRAITHWAITE

I should like to point out to the Minister of Agriculture that, owing to the larger yield of the crop this year, next year we may presumably, with good weather, hope for a further increase. The present accommodation offered by the sugar beet factories for handling the sugar beets will not then be adequate, and we shall have to provide, and immediately, more new factories to deal with the increased crop which we may reasonably expect The CHAIRMAN: I cannot see what that has to do with the increase for the year ending on the 31st March next.

Major BRAITHWAITE

I was trying to show that the farmer is the man whom we are trying to benefit more than any other by this subsidy, and if he and the smallholder are in the position of having a large stock of roots on hand which are not able to be absorbed by the factories, it is going to he very serious from the arable farmers' point of view.

The CHAIRMAN

That would be in order on the main Vote, but not on a Supplementary Estimate.

Major BRAITHWAITE

From the point of view of the £450,000 that we are asked to vote to-day, I, personally, feel that we ought to be very gratified at the results that have been achieved, and had it been more we should not have grudged it. The hon. Member for South-West Bethnal Green (Mr. Harris), in his remarks on the subject, seemed to me to show a complete disregard for the interests of the persons whom we are out to benefit, and if he was voicing the policy of his party, who are putting forward an agricultural policy to help the farmer, I am sure there must have been some mistake in his remarks. At any rate, I feel that the farmers of the country are very grateful to the Minister of Agriculture and to the Government for the provision of this extra money during a very bad year for the other crops that the arable farmer produces. It has been the one good thing that the arable farmer has been able to handle this year, and the small price that he has been able to get for his other crops has been in some way compensated for by the provision of this extra money which we are asked to vote to-day.

Mr. PALING

The Minister referred to the continuous process, but I think his answer was quite unsatisfactory. I think he said that a certain small factory had been sold to certain people, but if I gathered his answer aright, it was being run, not on the lines of the continuous process, but merely on the lines raised by an hon. Member opposite, of a small factory—

Mr. GUINNESS

May I make that plain? The British rights in the de Vecchis process were presented to the Government. Experiments on this system have been carried out by Professor Owen at, the School of Agricultural Engineering at Oxford. The de Vecchis process was also tested at a small scale factory built by the Government at Eynsham, The experiments having been concluded, that factory has now been sold to a company formed to manufacture sugar by a new process. The Eynsham factory is not working on the original de Vecchis process but is using additional discoveries which Dr. Owen has recently made at Oxford. I understand they are worked by what is known as a lixiviation process, which is in some way to dissolve the sugar out from the dried beet in contrast to the ordinary diffusion process, which is to boil the sugar out of the wet roots. But both processes are, I believe, continuous in the ordinary sense of the term. They begin with the beetroot, and they produce fully refined sugar.

Mr. PALING

I understand that better now, but I wanted to ask whether there was any research work going on in the direction indicated by the hon.

Member who put the point. He suggested that there was a possibility of a process being found for cutting and drying the beet, which would have enabled the factory to be carried on all the year round. It is understood at present that a beet factory works for only about four months out of the year. These factories are very costly, and everybody must know that a huge amount of capital is represented by one of these factories, so that for a factory to be standing idle for eight months out. of the year is a very costly process, and if anything could be devised which would make it a continuous process and keep the factory in operation all the year round, the overhead costs must come down tremendously, and that would he a great step forward towards making this business economically sound. I want to know from the right hon. Gentleman whether the people who are receiving the subsidy, or the farmers, or the Government, or anybody concerned, are making any efforts in this direction, and whether any research work is being carried on, so that in time we may achieve the possibility of factories working for 12 months, and so put them on an economic basis. At present, in spite of the success, the business does not. seem as if it will be economic when the subsidy is finished. The point raised this afternoon is very interesting and the idea of netting 12 months continuous work, would seem to he the best line to take.

Mr. GUINNESS

I would refer the hon. Member to the report that has been published of the researches carried out by Professor Owen. Obviously, it would not be right to express any opinion as to the prospect of the success of that process until it has been tried on a larger scale.

Mr. HARDIE

I would like to put one or two questions with regard to the additional sum required of £450,000. I wonder how much of that sum is required to attain the necessary efficiency in this new industry. I am quite well aware that in a new industry much can be learned, but I want the Minister to tell me whether there has been included anything which we or other countries already know. The question of fertilisers came up to-day. Perhaps some of this £450,000 is due to the fact that we have not gone as a nation should go, when spending money like this, into the scientific side of beet production. Have those in charge taken as the basis an analysis of the ground and atmospheric conditions. It is quite easy for the chemist to add extra moisture, and to make up for the extra sunshine needed, and so get down to a basis. Possibly a goad deal of this money could have been saved if we had gone into the question of fertilisers. I have been trying since the Session opened to find out what is the amount of fertilisers used in this country in a general way. I can get no information, and by that I mean I cannot get the slightest information as to what is the basis per acre of fertilisers, natural or artificial. There is no evidence given anywhere.

If we are to have a scientific basis of industry, all these things should be tabulated, so that we could know exactly what we were doing. The analysis of a piece of ground does not cost very much. We have the figures from other countries, and it is the continuous laziness of the. British mind in this connection which prevents the application of these things. I would like the Minister to say whether any of these steps have been taken. Have you taken the moisture content over a year in British soil growing beet and compared it with that of other countries, and have you tried to find out whether the ratio of sunshine has anything to do with the growing of beet and the sugar content? It does not follow that when you grow a big beet you get more sugar. It is rather the quality of growth you want to see. The Government have got to go in for creative chemistry, because only in that way are you going to increase the production of any soil. I want to see the sugar subsidy used not merely for the purposes of sugar and molasses. Does this subsidy only go from the land where the beet is grown to molasses? I am quite clear in my mind that before this became an Act of Parliament we were told that the sugar refinery factory was not going to stop at molasses, and that from molasses we were going to take industrial alcohol and also a lower grade of sugar. Is any part of that subsidy, and any part of this £450,000, to go beyond the ground where the beet is grown and molasses?

Mr. GUINNESS

The subsidy is paid either on sugar in varying degrees of polarisation, or, if they choose, it can be paid on the molasses as an alternative.

Mr. HARDIE

Yes, but will you answer my question as to whether there is anything paid by way of subsidy for anything beyond the molasses stager You say you pay on the lower grade sugar.

The CHAIRMAN

That would be outside the Vote. I imagine it would be the duty of the Comptroller and Auditor General to call attention to it if that were done. Under this Vote the money can only be spent on sugar and molasses.

Mr. HARDIE

The point I wished to make was that there had been neglect in these other matters, and I wanted to see whether there had been neglect in this respect. I hope the Minister, if he cannot do it to-day, will be able to give us some information as to whether any of these things have been really done, because it is no use talking about smallholders doing this. What they are doing, they are doing absolutely in the dark. The smallholder gets a piece of land here and there, and it does not follow that that land will be suitable. You may have a man wasting his time, whereas, if you got all the information, it would be infinitely better, and would make for the successful growing of beet.

Question put, and agreed to.