DEBATE ON THE ADDRESS.

HC Deb 09 November 1928 vol 222 cc383-464

[FOURTH DAY.]

Order read for resuming Adjourned Debate on Amendment [8th November] to Question [6th November]— That an humble Address be presented to His Majesty, as followeth:

MOST GRACIOUS SOVEREIGN. We, Your Majesty's most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland, in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which your Majesty has addressed to both Houses of Parliament."—[Major Edmondson.]

Which Amendment was, at the end of the Question, to add the words: But regret that, although Your Majesty's advisers have had four years of office with a commanding majority in Parliament, general election pledges remain unfulfilled, the country is burdened with the problem of unemployment in a more acute form, in many mining areas appalling conditions prevail, the proposals outlined in the Gracious Speech are utterly inadequate to meet the existing industrial situation and ignore the need for improving the conditions of labour, and, in particular, regret that the oft-repeated pledge with respect to factory legislation is unredeemed, and that it is the declared intention of Your Majesty's advisers not to honour it during this Parliament."—[Mr. Clynes.]

Question again proposed, "That those words be there added."

Mr. SNOWDEN

The Chancellor of the Exchequer rose immediately after my right hon. Friend the Member for Platting (Mr. Clynes) had moved his Amendment, and we expected the right hon. Gentleman would follow the Parliamentary pr active, which had prevailed up to Tuesday last, of dealing with the speech which had just been delivered. But the Chancellor of the Exchequer is apparently an apt pupil of the Prime Minister, and he has adopted the Prime Minister's practice of evading meeting a difficult case against the Government. The Chancellor of the Exchequer made no attempt whatever to deal with the indictment of the Government as set forth in the Amendment which my right hon. Friend had moved. Practically the only reference the Chancellor of the Exchequer made to my right hon. Friend's speech, before he proceeded to read an elaborate essay upon the problem of unemployment, was to say that my right hon. Friend's speech had peen conceived in a purely negative attitude. It appears to be necessary that we should call the attention of the Government to the terms of the Amendment, which are a condemnation of the Govern/mot that, after four years' office in which to deal with the question of unemployment, the problem remains to-day in a gravely aggravated form.

Our charge is that not one of the promises made by the Prime Minister and by the Conservative party at the last election in regard to employment and improvement in the general condition of the people has been redeemed. That is our Amendment, and the Chancellor of the Exchequer, speaking on behalf of the Government yesterday, made no attempt whatever to meet those charges. He made an appeal that this question of unemployment should not be thrown into the cockpit of party controversy. That is a new attitude for the Tory party to adopt. They evidently did not accept the non-party character of the unemployment problem four and a half years ago, when the Latour party were in office. I remember that we had not been in office for a month before what was practically a Vote of Censure upon the Government was moved from the Tory Front Bench because we had not, in four weeks' time, solved the unemployment problem. The Chancellor of the Exchequer yesterday tried once more to excuse the inaction and the incapacity of the Government in dealing with this question by putting the entire blame for the present industrial depression upon what he said was the action of the Labour party or the trade unionists in 1926. Well, that excuse is getting a little stale. The Chancellor of the Exchequer said that that would be their retort to our criticism of the failure of the Government to deal with this question.

What are the facts? Is this problem of unemployment a problem which has arisen since 1926, and have the unfortunate incidents of 1926 contributed to the aggravation of this problem? In reply to that, I would like to call the attention of the Government to one rather important fact. The Chancellor of the Exchequer, I repeat, claims that all the Government's difficulties in regard to unemployment are due to the coal crisis of 1926. What are the facts? 1925 was before 1926. [Laughter.] I am very glad there is sufficient appreciation of obvious facts on the other side to realise that. 1925 was before 1926. There was no coal stoppage in 1925. There had been no general strike in 1925. When this Government took office, near the end of 1924, the number of registered unemployed was 1,205,000. Twelve months later, at the end of September, 1925, the number had risen to 1,401,000, an increase of practically 200,000 in the first 12 months of the term of office of a Government which had told the electors 12 months before that they had a positive remedy for unemployment. Was that increase of 200,000 in the registered unemployed due to the coal stoppage? Was it due to the general strike? I venture to submit that that one fact alone entirely disposes of the excuse of the Chancellor of the Exchequer that the present state of unemployment is due to the incidents of 1926.

But suppose we were to accept his contention to the extent of saying that the present situation was in some measure due to the incidents of 1926. What is the answer? The right hon. Gentleman tries to put the blame and responsibility for the coal stoppage and the incidents associated with the coal stoppage upon the Labour movement. The entire responsibility rests with the Government. In 1925, when they were compelled to realise that the coal industry was heading to a serious crisis, they adopted the temporary expedient of making a subsidy of something like £25,000,000, an act which never had the slightest chance of staving off a crisis, or helping the industry to put itself into a proper condition of affairs, and in the 12 months during, the operation of that subsidy, knowing how things were going, the Government did nothing. They allowed the crisis to develop, but it was not the miners and it was not the Labour movement that were responsible for the stoppage in the coal industry. It was not a strike: it was a lock-out. The Chancellor of the Exchequer just now dissented from my statement. For 12 months before the stoppage the Government did nothing. It is quite true that they appointed a Royal Commission, and that Royal Commission reported. What was, he purpose of the Government in appointing that Royal Commission? Was it to act upon it, or simply to treat it as the reports of Royal Commissions are so often treated, and to do nothing more than scrap the recommendations? It was the duty of the Government to adopt the recommendations of that Commission, but instead of that, for eight months they allowed that stoppage to continue, with the disastrous consequences stated by the Chancellor of the Exchequer yesterday. The only thing they did during that time was to act as agents, aiders and abettors of the mine owners.

I am not surprised at any audacity on the part of the Chancellor of the Exchequer, but if he is going, as he promised yesterday, to repeat that retort, then there will be a further retort, and I have sufficient confidence in the common sense and the intelligence of the electors of this country to trust them to decide upon which side the truth lies. We have already had plenty of evidence of what their decision will be. The Tory party have not won one by-election in an industrial constituency since 1926. A year ago the number of unemployed was 1,132,000; to-day it is 1,374,000. That is our case for the Amendment. That is our ease against the Government—an increase in 12 months of registered unemployed of nearly a quarter of a million. That is after four years of office of a Government which four years ago said they had a positive remedy for unemployment, and after the election pledge of the Prime Minister that the Tory party would, be unfaithful to its principles and its duty if it did not make this question of unemployment its paramount consideration. That is our case—an increase in 12 months of a quarter of a million of registered unemployed, and that, as everybody knows, as the Minister of Labour knows, does not represent by any means the total number of those who are out of work.

What is the answer of the Government to that? We got the answer in the speech of the Chancellor of the Exchequer yesterday. There was not one word, by way of attempt to deny the statements that are made in our Amend- ment, not one word of explanation, apart from his ridiculous contention that it is due to the coal stoppage of 1926. I wonder what kind of speeches would have been made from these benches if Members opposite were sitting here, and we had had four years of Labour Government, and at the end of that time the Opposition could point to an increase in 12 months of a quarter of a million in the number of unemployed. The right hon. Gentleman yesterday gave a word of advice to this side of the House against the unwisdom of promising too much in election speeches and election programmes. That, surely, is a piece of advice which might have been very much more useful if he had given it to his own party.

Our Amendment not merely complains of the Government's failure to deal with the unemployment problem, but of their failure to redeem their pledges to improve the general condition of the workers of this country. There was a very definite and official pledge at the last Election that the Tory party would devote all their energies to improving the general condition of the working people in the country. It was not merely in regard to unemployment: very special attention was to be given to juvenile employment. What have they done? Does the Prime Minister know the number of boys and girls under 16 years of age who are unemployed to-day? Does he know that there has been no reduction during the last four years in the numbers of juvenile unemployed? According to the figures that were published by the Ministry of Labour last week, 70,000 boys and girls under 16 years of age are unemployed. What are the Government doing? What are they going to do? That was not even mentioned by the Chancellor of the Exchequer yesterday. He apparently had no policy.

The Chancellor of the Exchequer gave an answer to a question yesterday which asked him to support a statement which he has been making on public platforms lately about an increase of £100,000,000 a year in the purchasing power of the people during recent years. The statement is entirely unfounded, and even if it were true not an atom of credit is due to the Government for it. It is not the Govern- ment that has reduced prices. Prices are regulated by world conditions, and world conditions are responsible for the reduction in the cost of living. What are the facts? From 1st January of last year up to the present time there have been wages reductions amounting to £26,000,000 a year. Real wages in January this year as compared with the pre-War basis were 100.5; on 28th September they had dropped to 99.0, and there has been a decline in real wages each month since March of this year. The Chancellor of the Exchequer, as a means of increasing the purchasing power of the people, has placed £40,000,000 a year of indirect taxation upon them. This is the Tory way of redeeming the pledge to improve the condition of the working classes of this country. But that is not by any means all that they have done. Two or three years ago the Chancellor of the Exchequer, I suppose by way of redeeming his Tory pledge to improve the lot of the struggling poor took £5,000,000 from the Unemployment Insurance Fund: he took millions from the Health Insurance Fund, the consequence of which is that the surpluses of the National Health Approved Societies have been reduced to vanishing point.

They also promised better trade. The Tory party have always claimed to be the party which gave us good trade. I remember as a boy that the Tory slogan used to be, "Vote Conservative and good trade." After four years of this Government, where is the good trade! In the first two years of this Government exports went down £100,000,000, and as compared with 1921 they are down, in the first eight months of this year, by £90,000,000. What have the Government to say about that? Is that a redemption of the pledges which they gave at the General Election to give the country better trade?

Then again, at the last Election the Prime Minister gave a very definite promise to deal with the slum problem. What have they done? He said that the Unionist party were determined that the improvement of slums should be taken in hand. Have they done anything? They have done absolutely nothing. The condition of the slums has been going from bad to worse during the whole lifetime of the Government. They claim credit for what they have done in regard to general housing. They have built a million houses in ten years, but that does not meet the annual need of the increased population and the houses which become unfit for habitation. They have not touched the shortage which existed ten years ago in the slightest degree. They promised to deal with the slums and they promised to deal with the housing question, and to-day 80,000 men connected with the building trade are out of work. [Laughter.] That appears to he a matter of hilarity to some of the hon. Members opposite. If the Government had redeemed the Prime Minister's pledge to deal with slums, if they had redeemed their pledge to deal with the general housing shortage, there need not have been one of those 80,000 men connected with the building trade out of work—not one.

Mr. JOHN

Not even Winston.

Mr. SNOWDEN

I understand the right hon. Gentleman is not yet upon the unemployment register as a member of the Bricklayers' Union. I think I made a remark in the House a year or two ago to the effect that agriculture was the pampered darling of the Tory party. What have they done for agriculture? They gave a pledge at the last election that they would arrest the decline in arable cultivation. It has gone down by 750,000 acres, and they came to the House of Commons last year and told us that after four years of Tory Government the state of agriculture was so deplorable that it was necessary that it should be relieved altogether of the payment of rates. No matter where you look, you will find that things have been going from bad to worse during the last four years. Not one of the pledges which they gave has been redeemed, not one, but, as I have shown already, they have done a great deal in one or two respects to aggravate the industrial situation, and nobody has been a greater criminal in that connection than the Chancellor of the Exchequer himself. A great deal might have been done to find useful work for the unemloyed in the improvement of our roads and the making of new necessary roads. Instead of that the right hon. Gentleman has robbed the sources of the Road Fund of something like £26,000,000 a year. [HON. MEMBERS: "What?"] Not £26,000,000 a year—robbed it of £3,000,000 or £4,000,000 or £5,000,000 a year, not for once only, but every year. Every local authority in the country is complaining that in consequnece of that it is having to cut down its expenditure upon the improvement and the maintenance of roads.

In despair, the Prime Minister, some months ago, sent a letter to the employers of the country begging them to try to find extra jobs—if it were only one or two which they could find it would help. I do not want to say Anything which might be grossly offensive, and I doubt whether it might be Parliamentary if I correctly described that letter, but for a Government which had cut down employment upon their own works it was nothing less than a piece of gross impertinence to make such an appeal. And the Prime Minister has got from Tory public bodies all over the country the only reply he could expect. The Minister of Labour had a bad five minutes yesterday dealing with this matter. In reply to questions which had been addressed to him as to what had been the response to the Prime Minister's letter, he told us that something like 600 persons a week are being found jobs. That has nothing to do with the Prime Minister's letter, nothing whatever to do with it. When I got up and put that point to the Minister, he could not reply. That thing was going on before the Prime Minister's letter was sent out. Transfers have always been taking place from one district to another.

IS this the fourth or the fifth King's Speech of this kind? It is one or the other. In the first two or three King's Speeches there were promises and there were expressions of deep concern about the state of employment. It appears that the Government are now rather ashamed of themselves, and we get practically nothing in this King's Speech dealing with the question of unemployment. If one read this King's Speech without any knowledge of the existing facts one would assume there was no such thing as unemployment in this country outside the mining industry. The Chancellor of the Exchequer's speech yesterday seemed to take that for granted, because he tried to minimise the gravity of the unemployment problem, saying it probably was hardly bigger than it used to be at times before the war. Of course, there were periods of trade depression before the War, but they were short, they were tern- porary. The serious thing about the present state of employment is that a vast mass of unemployment has now become chronic. In the last ten years the numbers have never sunk below 1,000,000, and at times have got above 2,000,000, and it is that grave fact which distinguishes unemployment to-day from the occasional periods of unemployment which we experienced before the War. The Chancellor of the Exchequer said yesterday that the whole problem of unemployment can be summed up in one word— coal.

The CHANCELLOR of the EXCHEQUER (Mr. Churchill)

No, I said the industrial history of the last four years could be summed up in the one word "coal."

Mr. SNOWDEN

If I have misrepresented the right hon. Gentleman I am sorry, and I apologise, but if the right hon. Gentleman himself did not say that -the King's Speech said it, and that is the collective opinion of the Government and not merely the opinion of the Chancellor of the Exchequer. If the Government approach the consideration of unemployment from the point of view that it is simply a question of dealing with unemployment in the mining industry, then they will go on as they have been going on, they will do nothing. The Chancellor of the Exchequer yesterday complained that my right hon. Friend had put forward no constructive proposals. It is not our business to put forward constructive proposals. We have not the authority of the country to put forward constructive proposals now. When we are a Government we will put them forward, and I hope they will be proposals likely to be more productive of good than the ridiculous proposals which were submitted to the House of Commons yesterday by the Chancellor.

What did he propose? There was not a new thing in what he said: there was not one proposal which he made, not one scheme he outlined, which could not have been carried out four years ago. They are going to reconsider what he called relief works. I do not like the name. I associate myself with the quotation which the Chancellor gave from my right hon. Friend. There is all the difference between relief works and public works, although something might be said for relief works from the point of view of keeping the men in work and thereby maintaining their self-respect, their health and morale. There is no need to argue that point. There is plenty of public work waiting to be done which would provide useful and remunerative employment. What have the Government done in that respect? We are told that they are going to reconsider the question of grants to local authorities for carrying out public works. The Prime Minister promised to do that during the General Election when he stated that the Government would carefully consider all existing schemes in order to see if they could be extended.

What have the Government done? As a matter of fact they have closed down the unemployment grants. In reply to a question the Minister of Labour admitted that those grants had been enormously reduced, and in fact some of them have practically vanished. The Government, by the policy which they have adopted, have really added to the burden of unemployment instead of doing something to relieve it. The Government have promised to see whether the schemes which are now in existence can he extended, and they are going to make an offer to local authorities to the effect that if they will carry out certain schemes Treasury assistance will be given. I want to know how much assistance will be given? The Chancellor of the Exchequer was very vague indeed on this point yesterday, and he did not give us any estimate of the expenditure which would be involved in this or any other respect; he did not even tell us the number of men to whom employment would be given under these schemes. I want to know how much money is to he allotted by the Treasury to the local authorities in order to carry out the policy which has been announced? I think it will be precious little because the Chancellor of the Exchequer has not got the money. I notice that a peculiar condition is to be applied to the allocation of these grants to local authorities because it has been laid down that the local authorities must undertake to offer a certain proportion of employment under these schemes to the men in the mining areas. If there happens to he no unemployment in the district where the work is to be carried out there might be something to be said for that policy, but I would like to ask if the Government have visualised what is going to happen in such a case? Have they considered the animosity that might be created between the unemployed men in that district and those men who are transferred?

Mr. CHURCHILL

How are you going to get the miners away from the depressed areas?

Mr. SNOWDEN

It is not for us to put forward proposals. We have innumerable proposals, but we are not discussing that question at the present moment. We are now discussing the failure of the Government to deal with this problem. On many occasions we have pointed out how the Labour party would deal with this problem, and we should not deal with it in the pettifogging way in which the Government now say they are going to attempt to deal with it by applying small remedies to great evils, a policy which will produce no good results at all. This particular proposal and all the proposals of the Government will not make the slightest impression upon the magnitude of the unemployment problem.

There is another point to be considered in reference to this bringing of people from one district to another. Is there going to be under this scheme any guarantee of permanent employment, because that is a very important point. A number of men will be brought into a district to make a new park or construct a new road. The money will be granted for that specific purpose, and as soon as that particular work has been executed those men will be thrown out of work and probably will become a burden upon the rates of the locality to which they have been transferred. I need not say anything further about the claim made by the Chancellor of the Exchequer in regard to the effect of his de-rating scheme. I remember that the Chancellor of the Exchequer—and I think his contention was supported by the right hon. Gentleman the Member for Hillhead (Sir R. Horne)—said that although de-rating would not become a reality until the end of next year its effect would be immediately beneficial because it would give encouragement to industries to extend their programme, with the certain knowledge that in 18 months they would get this great relief. I am quite prepared to wait for another 12 months, or even a little longer, to see what effect the de-rating proposals of the Government will have in stimulating industry. I venture to make this prophecy: that it will be impossible to find any appreciable result at the end of that period which can be attributed to these de-rating proposals.

I think the right hon. Gentleman the Member for West Swansea (Mr. Runciman) was right in saying that the de-rating proposals of the Government will have no beneficial effect at all because they do not tend to increase the available sources of work. I believe their tendency will be to place more burdens on the community. I do not know whether it was done deliberately by the Government or not, but what a humiliation it was for the Chancellor of the Exchequer, a man who believes in free trade as he believes in the multiplication table, to have to appear at that Box yesterday in a white sheet and recant the three trade belief which he was so eloquently expressing only a few months ago. The Chancellor of the Exchequer still maintains the character of the Vicar of Bay, and he is determined to remain in the Government whatever their policy may be. We are going to have a special del-m.3e on this question one day next week and in this connection I will follow the example which has been set by the Prime Minister and postpone any further observations on this question until the matter can be more fully discussed. I would like to say that I agree with the Prime Minister in regard to this matter that no partial remedies such as the extension of safeguarding can have any effect upon the present situation.

In regard to Empire Settlement, our party is wholly associated with the desire to develop all the resources of the Empire, but, if I may be permitted to make the remark, I think we are concentrating too much upon the attempt to develop the self-governing Dominions, and neglecting the far greater possibilities in those parts of the Empire which are populated by native races. It is there that there is a far greater hope of helping trade in this country. As far, however, as I could understand the re- marks of the Chancellor of the Exchequer on this subject yesterday, the only thing that the Government are going to do is to provide cheap passages.—[Interruption.] What are cheap passages going to do? I think we ought to realise that the people whom we are trying to emigrate to-day are rather a different class of people from those who emigrated in the days before the War. Then they were adventurous people, and they were people who had saved money. Now the kind of people that you are seeking to emigrate have no money. What is the use of cheap passages to them if they have not a penny in their pockets when they get to the other side? There was not a word on that aspect of the question in the speech that the Chancellor of the Exchequer made yesterday. After four years of such lamentable and tragic failure, within six months of leaving office—because the speech of the Chancellor of the Exchequer yesterday and the proposals that he brought forward are merely a death-bed repentance—there is not a single one of these proposals, however much good they may do eventually, that is going to have any impression upon the unemployment problem between now and the end of this Government.

12.0 no.

May I ask, do the Government expect that the cumulative effect of these proposals will be to reduce the number of unemployed by 30,000? Will they pledge themselves to that? Unemployment increased by 30,000 last week, and, while you are reducing—I do not know that you will—while you are trying to reduce unemployment by 1,000, 10,000 will be added to the number of unemployed. There never was a more pitiable, tragic experience of incompetence and failure made in this House than that which was made by the Chancellor of the Exchequer, representing the Government, yesterday. Four years! A. quarter of a million added to the unemployed; wages down; foreign trade down—that is the record of this Government. That is our Amendment; that is the charge that the Government have to answer; and I hope that subsequent speakers on behalf of the Government will confine themselves to that charge. I have, in reply to interjections from the other side, said that it is not our busi- ness on this side to put forward alternative proposals. That we will do at the proper time and in the proper way, and if, as a result of the next general election, we have placed upon us the responsibility of dealing with this problem, then I will promise the House of Commons this, that if at the end of four years we cannot show something better than the miserable record of this Government on this question, I at any rate will not resist a similar Vote of Censure to that which we are moving against them.

The MINISTER of LABOUR (Sir Arthur Steel-Maitland)

I should like at the beginning to make one reference to the speech of the right hon. Gentleman the Member for Platting (Mr. Clynes). He made a most kindly reference to me on my return to Active duty, and I want to thank him for it, and to say that it is really references of this kind which mitigate what might otherwise be the acerbities of this House. Perhaps, for that reason, the House will forgive me if I do not deal with the question in quite the same bitterness of utterance which has characterised the speech to which we have just listened. There is one thing of which we are all aware. We all know the ex-Chancellor of the Exchequer, and we know that, if he deals with us in controversy in this bitter language, he keeps a double dose for his own side when he meets them in private conference. The vinegar of the ex-Chancellor of the Exchequer is like the dew of Heaven in one respect, that it comes down alike on the just and on the unjust, on the evil and on the good.

There are many points of the right hon. Gentleman's speech with which I hope to deal, and others that will he dealt with later, but there is one part of it to which I would call attention at once. Not only has the right hon. Gentleman proposed nothing, not only has he been ready to make no proposals himself in regard to a problem which is so vital to the country, as we all admit, that we might expect even the ordinary rules of party controversy to he transcended for the moment; but he has gone out of his way to try and put hindrances in the way of the proposals that the Government themselves are making. We all agree on one point, and that is as to the seriousness of the problem that we have to face. It has been with me, naturally, night and day, and it has been with me when I have been ill just as when I have been well. I always look at it on its own merits, from the point of view of the whole sum of human happiness or human hardship that is involved. The last thing that we want to do is to deny the seriousness of it; none of us do; and just for that reason we have tried to take it, and we have taken it, and viewed it in its real essence, in its real nature, and are trying to deal with it as it exists.

Let me again put briefly to the House the nature of our proposals. It is, as my right hon. Friend said yesterday, a dual problem. There is the whole question of trade generally, and then there is the acute question of the coal-mining areas. We do not pretend that trade generally is buoyant; it has had to suffer all the difficulties, to which my right hon. Friend alluded, created by the War, and, in addition, the difficulties that have been created during the past two years. I am going to deal directly and immediately with the second part of the problem, which is the great difficulty, particularly in South Wales, Durham, Northumberland, and part of Scotland. There one finds the whole population of a valley engaged in one industry, with the result that when disaster happens to the industry the whole valley is involved. The case is unlike that of a great manufacturing town, where very often even if one industry is depressed employment is going on in other industries, which mitigates the result. I deal with this problem at once in answer to the right hon. Gentleman's challenge, because it is also referred to distinctly and with peculiar emphasis in the Amendment, which says that in many mining areas appalling conditions prevail for which the proposals outlined in the gracious Speech are utterly inadequate to meet the situation. I have lived in Durham mining districts. I am living near a coal-mining district in Scotland. I have not lived in any in Wales, but I have visited them and I have been from one valley to another over the intervening ridges—those valleys spread out like the fingers on one's hand and run up into the hills. I realise what a difference there is in South Wales, from the time when it was in all the pride of prosperity.

I wish to urge upon the late Chancellor of the Exchequer, and upon all the mining Members, that in a matter of this kind while the primary responsibility rests upon the Government—and we would none of us deny that primary responsibility—yet when it comes to measures of relief every Member of this House has himself a responsibility which he cannot shoulder off. The problem is that in that industry there are from 200,000 to 250,000 men who are surplus and whom it can never absorb again under any conditions in the near future. That is not a statement that is peculiar to one party. That is the picture of it that is given by every party irrespective of political creed. It is the estimate agreed to in the Liberal Yellow Book. It is the estimate agreed to by the Labour party. When I read the joint Memorandum of the Trade Union Congress, the Labour party and Miners' Federation, I find them agreeing exactly on the extent of the problem, and they do it in these words: One of the most pressing problems is that of the over-supply of labour. Even under the Labour scheme there would be no prospect of the industry keeping 1.100,000 miners permanently employed. Under the existing regime the unemployed and under-employed miners cannot expect to be re-employed in the mines at any rate on any permanent basis. The view is generally that there is a surplus of 200,000 to 250,000 workers in the mining industry.

Mr. RAMSAY MacDONALD

What is the date of that?

Sir A. STEEL-MAITLAND

1926, and it is true to-day. One of the methods by which the party opposite would try to deal with this evil is nationalisation, and they look to more scientific ways of treating coal as one of the cures for the industry. At present there are over 200 different plants in this country engaged on low-temperature carbonisation processes. There is one plant I know which is dealing with the hydrogenising process. Agreements also exist with firms in other countries for the use of the results of their enquiries. I put it to the ordinary common sense of the House, if that is to be the salvation of the coal industry, is it likely to he promoted more by nationalisation or by private enterprise. Under private enterprise you have over 200 different plants. You have a large number of different sets of people in com- petition with one another trying to find a solution. The best opinion, as given me by the Government Fuel Research Board, is that probably one of them will succeed, but it may be one of any half dozen or any dozen different processes. No one can tell which of half a dozen or a dozen different processes may be the one that eventually hits the bulls-eye. Success is more likely to be achieved where you have all these different sets of people pitting their brains against one another than under one unified Government system.

I return to the main problem. Our belief is that we should attack it from different sides by all means possible and by concentrating them all upon the question. Let me take first of all the question of rates. There will be a reduction by way of anticipation in railway rates, starting from 1st December. That reduction will be concentrated on the export districts, precisely those districts which are suffering most acutely, They are suffering acutely because the competition in oversea markets, acute in any case, has been rendered more difficult by the fact that our foreign competitors got a footing in those markets, for example in the Baltic, during the time of the strike. There is no one in the House, if he puts the question to himself honestly and not as a matter of party controversy, who will not believe that the reduction in the railway export rates is likely to be of immense advantage.

I give my practical experience. In the old days I was a buyer of export coal from this country. I used to buy from 60,000 to 80,000 tons a year of British coal. I know well, as between the different offers, what difference is made by threepence a ton—given quality for quality and thermal units and ash and moisture and all the rest of it which we have to take into account as practical men. Being a British company, we got offers from the different British exporting firms. The ordinary foreign buyer sets the British exporter against the exporter from Silesia and against the exporter from Germany and everywhere: else. If then, as I have given in my own personal experience, threepence may make all the difference, can anyone deny that a reduction in the export rate of 7½d. is not likely to be of vast help to the industry? That is one form of help which we are providing.

Another question is migration. We propose to encourage migration to the Dominions in every way that lies in our power under proper conditions. I want to acknowledge at once that I do not think that they can better be described than they were by the right hon. Gentleman my predecessor at the end of his speech last night. We want to encourage agriculturists to go to Canada.

Mr. MacLAREN

Why not stay at home and use the land here?

Sir A. STEEL-MAITLAND

I would suggest to the hon. Member that if, from his own point of view, he thinks that that is a right remedy it does not exclude the other. You want to attack it from all sides at once. We want to extend this migration to Canada, and I am grateful to the right hon. Gentleman for the way in which last night at the end of his speech he dean with migration to Canada. It is for that reason that we have had training centres set up during our administration. The first demand in Canada and one for which the doors there are widest open is for agricultural workers. I wish to repeat that when they get agricultural workers, if they are miners trained in agriculture, they are getting some of the best workers that can be obtained in the world. We are setting up instructional centres where men can get a training in agriculture which qualifies them to enter Canada as agricultural workers. We have started these centres, we have increased them, and we are continually increasing them further. It takes some time to train a man who has not been an agriculturist in agricultural work, but we hope to push them through at such a rate that we ought, with good fortune, during the course of the next six months, to have from 5,000 to 6,000 ready to go to Canada. Here again the individual Member of Parliament has responsibility as well as others. It takes trouble and effort to make sure that the instructional centres are filled up. It is very easy for any Member of this House, just as it is for any trade union official who has influence in his own mining district, to cramp the movement. The attitude that Members themselves and their friends take up in the districts may make all the difference to success or non-success.

Mr. DAVID GRENFELL

If they know that the scheme is futile, why pretend that it is any good?

Sir A. STEEL-MAITLAND

The hon. Member should ask his right hon. Friend.

Mr. GRENFELL

I have worked there for two years, and I know about the country.

Sir A. STEEL-MAITLAND

How many years ago?

Mr. GRENFELL

Twenty-five years ago and there have been no changes.

Sir A. STEEL-MAITLAND

The country has changed enormously since then.

Mr. GRENFELL

There are thousands of derelict farms all over the country.

Sir A. STEEL-MAILAND

The hon. Member has had his turn, and we listened to him attentively last night. I would ask him to consult with the right hon. Gentleman in front of him or the hon. Members behind him who have been to Canada recently and who can give him an account of their own experiences as to the possibilities in Canada. I was saying that on the general policy we ought to be able to train, unless the scheme is spoiled for us, from 5,000 to 6,000 men in the next six months. Next as regards work other than agricultural. In the great prosperity that there is in Canada at this moment there is room for far more men in the towns as well. As my right hon. Friend the Chancellor of the Exchequer has stated, we are in negotiations with the Canadian Government at this moment so that the doors may be opened wider to those who wish to go as workers in the towns. It is hoped that a minimum of 3,000 or 4,000 of these may go in the next six months, and, if we are successful in our negotiations, the number should be considerably greater. That is as regards migration.

I turn to the policy of transference inside this country. Objections have been raised both yesterday and to-day and there could be no bleaker opponent of the scheme than the right hon. Gentlemen the Member for Colne Valley (Mr. Snowden). Let me just point out how entirely different is the attitude of those who have been using this matter of acute unemployment as a Parliamentary case in their condemnation or approval of a scheme of transference from the attitude of those outside who have considered the question. The ex-Chancellor of the Exchequer comes to-day and decries it. The Miners' Federation who have really got a practical interest in it are coming this afternoon on a deputation. They ask for the transfer of unemployed mine workers in derelict districts to areas where a reasonable prospect of employment exists, and speeding up of the necessary housing schemes in the areas concerned. The Miners' Federation are asking for precisely the work to which the Government have put their hands, and the ex-Chancellor of the Exchequer is doing his best to prevent it being successfully carried out. That policy of transference to which we have set our hands is the policy that has received not only the imprimatur of the Miners' Federation; it is exactly what is recommended by the Industrial Transference Board. It is just what is shown in the Liberal Yellow Book. It is precisely the same as was asked for by the Trade Union Congress, the Labour party, and the Miners' Federation in the pamphlet to which I have referred and which I also hold in my hand. It has also been made part of the policy in the official programme of the Labour party, entitled "Labour and the Nation." Not only so, but it is the practice of the trade unions themselves every day. They send their members from districts where they have a branch which is suffering acutely from want of work to other districts and other towns where some unemployment may exist but where the chances of employment are better than in the towns where the depressed branches are situated.

Mr. COMPTON

Never on chance; on our own conditions.

Sir A. STEEL-MAITLAND

They send them to a situation if a situation can be found for them, in advance?

Mr. PURCELL

At guaranteed rates.

Sir A. STEEL-MAITLAND

Where a situation can be found for them in advance, at proper rates. That is exactly what we are doing to-day. In other words, on the hon. Member's own admission, we are fulfilling the conditions of his own trade union, as I hope to prove in a moment. That shows, and I am thankful to say that it does show, the kind of support that the former Chancellor of the Exchequer has behind him. At the same time I would ask hon. Members on the Opposition side in the constituencies to help the work and not to hinder it. I would ask them to remember that it was recommended on its merits by the Industrial Transference Board, on the broad general principle of humanity, that where employment in one district is better, that district ought to be ready to help other places where unemployment is so bad, as it is in some mining areas. That is the first broad, general principle of humanity on which the Industrial Transference Board base their report and to which every decent understanding man would give adherence.

On the other hand, I would ask hon. Members to bear in mind another point. It was said yesterday that if a man is to be transferred to one district from another he turns a man there out of a job. [An HON. MEMBER: He competes with him."] At once, some more prudent person adds a gloss to the cruder statement as soon as attention is directed to it. I give my acknowledgment and I am glad that it has been watered down. The fact is that in regard to work there is a constant turnover of the amount of engagements that are made every week. I think there must be 120,000 labour engagements made every week. I do not bind myself to that figure but, broadly speaking, I should think that is so. At the most—I am putting it at the most—the result of the transference policy would be that, possibly, a person who would otherwise have got a job by Tuesday would be delayed, perhaps, a few days in getting it, on the average. It is to minimise even that that the relaxation is being given of the conditions under which local authorities can apply to the Unemployment Grants Committee. I am not a lover of relief works. I do not call these relief works, either. They are public works. The same objection, however, though in a less degree, applies to public works too far anticipated which would not ordinarily be taken on their own merits. The right hon. Gentleman agrees to that also. This relaxation is intended in order to relieve the pressure at the end to which the miners are being drafted in order to meet the only objection which may exist—it would not exist much if it was not fostered—on the part of those who live in a town to other people coming there from more distressed districts. The object is to minimise all possible objection that can be raised.

Let me put another consideration. Take the question of new jobs, and here I will give my own experience. As soon as I got back to active existence, on the first day, on my way South, I went to the new centre for overseas training that was being constructed at Carstairs. I then went to the instruction factory in Garrison Lane, Birmingham. I talked to a large number of the men there. Half of these were people from the district and half from South Wales. It is not all injury to the district to have 200 of their men taught at Garrison Lane and it is not an injury to South Wales to have 200 people from South Wales brought there. I did not find a single one of them who was not glad that he was there. When it comes to learning new jobs, I can give an instance worthy of note. I found some of the men engaged on electric welding. At the present time there is a dearth of electric welders and certain work cannot be carried on sufficiently because of the want of electric welders. Consequently, by means of our experimental plant there we are training men in electric welding and so fitting men for jobs that would not be filled otherwise

Let me give an instance of a similar kind from the personal experience of a friend of mine. This is a case of a transfer to a forest holding of the kind to which the Chancellor of the Exchequer alluded yesterday. The home was a mile above a town and situated in what looked a comparatively bleak place. The house had been built and the family had been transferred from South Wales. The family consisted of II people. The man had gone first with one of his sons. There were nine children, ranging from every age and height. The wife was to follow on with one of the children, for family reasons, later. There was the house and a patch of ground. An unfriendly critic might say that the family had been dumped down there. What is the actual result? The very enterprising and industrious manager of the Employment Exchange went along to the place, but he could not get his little car within a mile of it. He went along with parcels of one or two things which the people needed. The man himself had brought his own chickens from South Wales to the holding. The man had obtained forestry work. I think the son had also obtained forestry work, although I am not sure. When the man looked at the ground, he said: "If I am going to make a success here with a family of nine, I shall need to buy a bit more ground than I have got." At the present moment there he is at work, and there the family are established. The man and his son between them can keep the whole family going, They are making the best use of the ground that they possibly can and they are infinitely glad to be there.

Mr. MacLAREN

Why not multiply such holdings? Why send the people to Canada?

Sir A. STEEL-MAITLAND

The right hon. Member for Colne Valley, when he spoke to-day, and other hon. Members who object to the scheme, seem to proceed on the assumption that employment in the whole of the districts of this country is static.

Mr. Mac LAREN

That is Government's assumption. Therefore, they want to send people to Canada.

Sir A. STEEL-MAITLAND

The hon. Member will have a chance to develop his own argument, instead of making so many interjections. I have already answered him. The assumption on which the Government have gone entirely justifies the present scheme. There is a great and increasing natural transference between districts. As hon. Members know, certain districts in the South of England are growing fairly fast, but there are other parts in Wales and Scotland where the natural growth is very small in the insured and employed population. It is almost stationary. Obviously, the right thing to do is to take advantage of the natural growth in districts and see that the unemployed population in places like South Wales are transferred to these districts. The natural growth can then absorb them without any undue hardship to anyone. The scheme of the Government is based on this: that is its foundation in principle.

In trying to carry out the policy of the Industrial Transference Board, my first difficulty was in trying to break up what I may call the ice-jam in some of the mining villages. These little colonies have lived there for a number of years and do not want to move. They have seen pits closed and re-opened again, and are inclined to stay there in the hope of better days. They are reluctant to believe what is the common opinion of Liberal and Labour Members, that there is a permanent problem of about 200,000 unemployed in the mining industry. That is what we have to overcome, and it is being overcome first by the publicity that is being given to the Report of the Industrial Board.

The next step in what is one long combined process was the Prime Minister's letter. The effect of the Prime Minister's letter was followed up by a whole stream of individual visits by officers of the Employment, Exchanges in order to facilitate the movement at the receiving end.

Now as to the progress: We started, quite rightly, to put the most pressure where the line of resistance was weakest; and that was with the boys. The individual case of a boy is as acute as that of a man, but looked at from the standpoint of bulk the problem of the boys is only one-thirtieth or one-fortieth the size of the problem of the adult men. We started with the boys, and. hon. Members will know how centre after centre was opened in South Wales—I think there are 18 there at the moment and 9 or 10 in the Durham area—in order to keep them together while arrangements were made for their transfer. We have transferred over 1,500 boys to vacancies which have been found for them. We have found Iodgings for them and in every possible way have tried to prevent any mishap occurring. The movement has reached the pace of 55 transferences per week, and the present rate of progress ought to be increased if we can get co-operation in Durham and some other districts. In- South Wales it has already reached the full amount which is considered right from the point of view of the needs of the district as a whole. About 800 boys have been moved already from South Wales and 25 per week are now being transferred. But the problem of the boys is a small one in numbers as compared with the problem of the men.

As regards the men, we are working partly by direct transfer to places which are found for them, partly through instructional factories and partly through the natural transference which follows places found for men by our Employment Exchanges. Yesterday the right hon. Member for Platting poured scorn on a miner from South Wales being a porter in London. I do not attach any shame to the work of a porter, and the fact that the right hon. Member should pour scorn upon it indicates an attitude of mind. When you ask whether the work is degrading hon. Members opposite say, "No."; but when it is a question of crabbing the scheme then the right hon. Gentleman disparages the work of a porter. My department has received any number of letters, entirely unsolicited testimonials, from men who have been transferred. I pick out one partly because it comes from a man who lives in a district in Durham where I used to live; partly because he is now a porter in London. This is what he says: I am pleased to toll you I got fixed up with a job last Tuesday as a porter at Cannon Street Station. I am working under pleasant conditions at the race of 52s. per week; it is an excellent job, and I am very pleased to have been sent down by you. I have a great lodge here with a chap named' George Carr, belonging to Craghead; he came down five weeks ago under the same scheme as myself, and he has never lost a day's work. He says he is very pleased he carne down. The grub here is the very best and it is cheapness itself at 22s. per week, everything included—food and bed. Well, sir, I will now ring off, thanking you again for this chance which you have given me. You will see by my letter I would not stand a very good chance as a clerk, would I? Hoping you will excuse the scribble. That is not an isolated case but one of a very large number. I went all through the cases in Birmingham and you find exactly the same thing. I have not found a case of a man who was sorry he had been moved. When a man is transferred, if you like artificially, the natural consequence is that when he finds an opening he immediately sends word to his friends at home. I have found that happen again and again from personal experience. Let me give one instance. A friend of mine obtained two maids from one of the mining districts. When I asked the two maids if they were satisfied they said "Yes." The girls said they were glad to be there and said" I wonder if you could get our fathers and mothers away. "That is what they asked. There was a little personal difficulty in shifting the father in one ease, but both mother and father in the other are now living comparatively close to their daughter in the same county.

That is what actually happens, multiplied indefinitely, according to our personal experience. I am not talking on guess work. We are creating a system whereby we can keep track of those who move. I am confident that every man who is transferred through the Exchanges to a place, will be the cause of more than one other man, on the average, being able to follow naturally. What does this total mean? It means that we have reached a pace of transfer which, if we can keep it up, will have this result—that through tire agency of the Exchanges and instructional factories, 15,000 will be transferred during the next six months. They will be the cause of at. least another 15,000 following naturally. That is a conservative estimate and is based on the data that we already possess. Migration should account for a minimum of 5,000, and it may be 10,000, in six months. The wastage of the industry accounts for anything from 10,000 to 15,000; that is to say, people retiring on old age, deaths and the rest of it, under the new conditions whereby recruitment for the industry, other than from local boys, must be through the ranks of the industry. Those figures are for six months.

If hon. Members will add together the figures I have given, they will see that the minimum by which we ought to be able to reduce this problem of the mining area, is a figure of 45,000 in the next, six months. But whether it will come to pass or not will depend very largely on the co-operation which we get from all those who have influence locally, and pre-eminently from those Members of this House who have an interest in the mining districts. I give my acknowledgment at once to Mr. Enoch Murrell, of the Miners' Federation in South Wales, for the part that he has played in overseas migration, and to the hon. and gallant Member for East Rhondda (Lieut.-Colonel Watts-Morgan), who is helping in the same way. We have to get help from everyone. I can only add that the emptying of these districts at the rate of 45,000 as the minimum in six months, is no mean performance.

I must pay one tribute. It is sometimes looked upon as a matter of form when a Minister pays a tribute to those who work under him in his Department. This work could not possibly have been done had not the whole of the staff engaged in it put their whole souls into it. They have hard enough work in the local Exchanges and at the central office, but they have put their heart into this work. It started while I was there and continued while I have been away and the Parliamentary Secretary has been in charge. They went on and put their whole energy into this work in a way that deserves the gratitude of the whole country and particularly of those districts that they set out to help.

Lastly, let me emphasise again that what we are doing is not starting an artificial movement that is contrary to the natural movement. Liberals may rest comforted with that knowledge. We are taking advantage of a perfectly natural transfer that would take place in any ease to the new districts that are growing, and we are using that as a means of alleviating the trouble in the mining areas. But a great deal depends upon the capacity to absorb. [HON. MEMBERS: "Hear, hear!"] I have already said that under present conditions the capacity to absorb is greater in those districts. Anything, however, that will increase it is all to the good.

That leads me to deal with the general question of trade and employment outside the coal problem. Those ironical cheers from the other side just now make one realise how necessary it is to take a true view of the situation. Exaggeration and understatement are equally vicious, because they prejudice a proper solution. I ask hon. Members to look at the facts. It is a great mistake simply to be hypnotised by the figure of unemployment that is published each Wednesday. No such figure is published or can be produced for other countries, and it would be wrong to take an unduly pessimistic view of the situation simply because no such figure is published else Where. Let us take either the country in the West or the country in the East to which the Chancellor of the Exchequer alluded yesterday. In Germany for the past year, the average live register has been about 1,400,000. I do not want to mislead the House by omission any more than by commission. Comparison is extraordinarily difficult. The figures in Germany went up to 2,000,000 last winter. You find that they are seasonally greater in Germany in the winter. They went down to 1,100,000 in the autumn. They are seasonally less then because of agricultural work. The fluctuations in Germany on the whole are greater than they are here. But there is nothing to show that the unemployment problem in Germany is any less than it is here, and that at a time when an abnormal proportion of it here is due to coal.

The moment I come to Russia or the United States, comparisons are still more difficult. I have tried, however, to ascertain the facts, so far as they can he ascertained, without fear or favour from such sources as the All-Russia Central Council of Trade Unions or such papers there as publish the statistics. Everything goes to make us believe that unemployment among the industrial workers in Russia is half as great again, at least, as it is here. So far as the United States is concerned, again ample or accurate and comprehensive statistics are impossible to obtain. We do know that early this year general statements were made in the United States that the unemployment figure reached a total of 4,000,000. Inquiry was made officially and that inquiry showed that there was a shrinkage of nearly 1,900,000 people in work as compared with January, 1925. However, January. 1925, itself did not show a particularly good figure of employment. It seems almost impossible to come to any other conclusion than that the figures in the industries comparable with out industries for which an unemployment figure is given, is at least. as high in the United States as it is here, and I believe I am greatly under-stating it in saying so.

Mr. D. GRENFELL

What is the figure for Canada?

Sir A. STEEL-MAITLAND

I have not got the figure for Canada, but if the hon. Member wishes for it I shall make inquiries about it. I ask hon. Members to remember that when we get this total for unemployment published each Wednesday, it is a total of unemployment on an increasingly large figure, always, of men within the insured industries, and that is why the number of men in work has grown vastly faster than the number of those out of work. It is 450,000 more now than it was four years ago. What is more, if the coal industry is taken out, so that we look, as I have asked the House to look, on the buoyancy of trade outside, then, as far as trade outside is concerned, there are definitely less unemployed at this moment than there were four years ago. Again, we are asked today to consider the conditions of labour—and here I am speaking to the point which I think the ex-Chancellor of the Exchequer wished to raise. The question of improved conditions of labour and this question of unemployment, he has said, are one. He has accused us of not improving the conditions and of being responsible for the unemployment. I took down the right hon. Gentleman's figures, and I find that they are—as I thought at the moment—incorrect. The right hon. Gentleman took the figure for the beginning of November, 1924—

Mr. SNOWDEN

No, I did not.

Sir A. STEEL-MAITLAND

—and compared it with September, 1925.

Mr. SNOWDEN

No, I took September, 1924.

Sir A. STEEL-MAITLAND

I am sorry if I have misrepresented the right hon. Gentleman by taking his figures down wrongly. What I think is, at any rate, worth noting, on his own showing, is the figure just before his party left office and the comparable figure this year. The figure when they left office was 1,228,000, and the figure for the 2nd November, this year, is 1,207,000—a decrease, not an increase, and, as I said, in that figure for this year is inflated by the situation in the coal industry.

1.0 p.m.

The right hon. Gentleman has said that we have done nothing to improve the conditions in the country and that, therefore, our election pledges have been broken. He has a convenient memory, or a convenient control over it. He has forgotten widows' pensions. They have passed out of his recollection. He, has forgotten old age pensions at 65. They have gone beyond his ken. When it comes to a reduction in the cost of living he says, "Oh, the Government are responsible for unemployment but they are not responsible for the reduction in prices." How does he manage to pick and choose? Take what is the case with regard to the actual conditions, including unemployment. I have had for my own information a most careful inquiry made into these very difficult points. I asked that wages should be taken on the basis of a normal working week and that the cost of living should be taken into account. We took the present cost-of-living figure as a basis. I do not think anybody would quarrel with that basis being taken. Judged by these two, there is no question but that the state of affairs in September, 1928, was an improvement on that of four years ago, the index figure having risen from 141 to 151. Then I asked for the amount of unemployment, if possible, to he taken in, so as to see what effect that would have. Even allowing for the unemployment at the present time, as compared with 134 in 1924, the figure is 142 now. On all the tests, therefore, that the right hon. Gentleman himself would apply, the promises of the Government have been fulfilled.

Lastly, I take his figure for juvenile unemployment. He gave us a figure of 70,000 unemployed juveniles, and he said this was another proof that the Government have broken their pledges. It is, if anything, a proof of how little the right hon. Gentleman himself is acquainted with the actual working conditions of working men who are in these employments, and whose children are in these employments. If he would take the trouble to understand this matter he would, know that a very different complexion was to be put upon it. There is considerable unemployment at this moment among boys in the mining districts, and in one or two other centres. Hut, subject to that, the general level of unemployment among boys is quite low. If the right hon. Gentleman will examine statistics before he talks about them he will realise this that when you get down to a figure of 2 per cent. of unemployment among men, or a little less among boys, you are getting down to a figure where actually the amount of operative unemployment is almost negligible. At all times during the War there was a figure of unemployment. Why? Because a man might be passing from one job to another assured job. He might be out only for one day, in passing from the one to the other, but he was caught like a bird in transit, and noted as unemployed on that Monday. A figure like 1½ per cent, or 2 per cent. is a negligible figure. Let the right hon. Gentleman go away and recalculate his figures for the country generally and he will come to a different conclusion.

As regards foreign trade generally, there is an amazing and a wonderful resiliency. I would have wished, but that I thought that the House would like it better that I should deal fully with the transference problem, to go into that, and my right hon. Friend will deal with the question of rates and the question of safeguarding and the other points which have been raised. But I can only say, with regard to coal, the most urgent part of the whole problem, that we are going forward at a rate that means that, thanks to the labour of love of the men who have been engaged upon transference within the country and transference by migration, there is every reason to believe that if we can go ahead at the rate at which we are going, we shall be able within two to three years to grapple completely with a problem which has been equal in intensity and in difficulty to any of the great economic changes that have confronted this country in the history of the last 500 years.

Mr. SHNWELL

Whatever we may think of the speech of the right hon. Gentleman the Minister of Labour, we can at least extend a welcome to him on his return to this Chamber. When I heard the closing utterances of the right hon. Gentleman, I wondered whether he was not labouring under a misapprehension, whether indeed there was such a problem as unemployment in this country, and whether it was, if it indeed existed, as grave and as serious as it had been purported to be, for the right hon. Gentleman dissolved the problem absolutely in the closing stages of what must be regarded as a remarkable utterance. He told us that in the United States unemployment was much more formidable, that it existed in Russia—we would have been surprised if Russia had been left out of any of these deliberations—that here unemployment was not quite so serious as it once was, and that real wages were higher. Nevertheless, it is the Government who are responsible for the declaration that unemployment is serious, for that is a statement contained in the Gracious Speech. We are prepared to take it from the Government collectively rather than from the right hon. Gentleman himself.

The problem is as menacing as it can well be, and our case against the right hon. Gentleman and the Government is that whatever advantages their proposals may bring to the unemployed in this country, those advantages are questionable and belated, for they have taken four years to produce even the barren proposals that are now presented to the House. I want to reassure the right hon. Gentleman in respect of one matter, to begin with. We shall not bring pressure to bear on the unemployed in mining areas to remain where they are. I hope the right hon. Gentle man will take notice of that. If the unemployed wish to proceed to other areas, that is a matter entirely for themselves, and if they can be assisted by the Government, so much the better; but those of us who live in already depressed areas will not be content to see admitted numbers of unemployed persons to swell the unemployment in those areas and to increase the competition between men seeking for employment. The right hon. Gentleman has apparently forgotten that what he is proposing to do in respect of his transference scheme is to stabilise unemployment in certain areas in this country. The right hon. Gentleman may sneer—

Sir A. STEEL-MAITLAND

The hon. Member must not think that I sneer about anything in connection with this matter, if any reasonable statement is made, but the whole object of the transference scheme is to do the opposite of stabilising unemployment.

Mr. SHINWELL

The right hon. Gentleman might well have waited before changing his natural expression until I had completed my observations in respect of this matter. What I want to tell the right hon. Gentleman, in spite of his interpolation, is this, that into areas where there is extensive unemployment he is proposing, through his scheme, to send more unemployed persons seeking for work. Will he be good enough to tell the House, now or at some other time, how that is going to diminish unemployment in these areas? I put it to him again, whether he knows it or not, that his scheme is one to stabilise unemployment in these areas: at all events, unemployment will not be removed in consequence of his transference scheme.

The right hon. Gentleman made some comment in respect of the speech delivered by my right hon. Friend the Member for Platting (Mr. Clynes), and wondered why my right hon. Friend had expressed himself somewhat disparagingly about the transference of men from mining areas to become porters in London. The right hon. Gentleman opposite is labouring under a delusion. It is not the transference to which we object, but it is that there are many unemployed persons in London who would welcome the opportunity to become porters. That has never occurred to the right hon. Gentleman perhaps. Does he seriously suggest that there are no unemployed in London who would be glad to be able to send him a letter similar to the one he received from the person who had come to London and obtained employment? There are thousands: and if he is not prepared to believe that, I would advise him to go down to those places in the neighbourhood of Fleet Street, where thousands of unemployed persons eagerly await the newspapers containing lists of situations vacant. If he did, he would discover that there are many of these persons only too anxious and eager to obtain employment as porters at rates that are exceedingly unremunerative.

I paid particular attention to the right hon. Gentleman's speech, because it was largely devoted to the conditions in the mining areas. When the right hon. Gentleman detailed the facts, with which we are all familiar, I wondered when he was going to furnish the solution. What has he done? He has told us that everyone has a responsibility, even the Government. We are all aware of that. We have our responsibility, and the Government have theirs, but the Government surely have a greater measure of responsibility than have the Opposition in this matter; and our case against the Government is that they have failed to apply proposals that are consistent with such responsibility as they have. The Government indeed are on the horns of a dilemma. Prominent Members of the Government, speaking elsewhere, declare that it is not the business of the Government to interfere in industry at all and that industry should stand on its own legs. The right hon. Gentleman's Friend, the Prime Minister, speaking two or three weeks ago in the country, declared that industry must find its own feet and not be constantly looking to the Government for assistance. Apparently, as he spoke he forgot that other members of the Government were boasting in the country that the Government were coming to the assistance of depressed industry. The Government, as I say, are on the horns of a dilemma. They are anxious to promote private interests, but they are compelled in some degree to recognise their serious responsibility to the country.

I am, however, more anxious to deal with the possibility of a solution of this great unemployment problem in the raining areas than I am to bandy words with the right hon. Gentleman. He said something—if I might ' digress for a moment—about some unkind remarks of my right hon. Friend the Member for Colne Valley (Mr. Snowden). He must not complain, however, because those of us who come from mining constituencies reflect the intense bitterness that clutches at the hearts and depresses the minds of the unemployed in those places, and if anyone speaks somewhat harshly, he must not take it amiss. Nevertheless, as I say, I am more concerned with presenting constructive proposals, surprising though it may be to the right hon. Gentleman, than to argue with him, and t present at once a constructive proposal, while at the same time agreeing with my right hon. Friend that we are not responsible for the presentation of constructive proposals. We have to do our duty and to point out to this country, and shall continue to do so, that the Government are unable to present constructive proposals of the slightest value. At the same time, I present one constructive proposal, and it is As. There are 1,300,000 and more unemployed persons in this country on the live register. There are many who are not. Why are they not on the live register? Because they have been disqualified by the regulations for which the right hon. Gentleman has been responsible. That is a problem that is amenable to an immediate solution. If the right hon. Gentleman removed these anomalies, the result would be that those who are not on the live register would be brought on at once, and presumably would receive unemployment benefit.

There is something more. There are thousands of unemployed persons in this country who are being buffeted about from pillar to post by the right hon. Gentleman and his Department. Has he never heard about the phrase "genuinely seeking employment"? Does he not know that there are thousands of men who are told, when they apply for benefit, that they have mat been seeking work, when, indeed, no work is to be found? Perhaps the right hon. Gentleman may pay a little attention to this very important constructive proposal I suggest to him, that whether the unemployed person is good, bad or indifferent, he at least in his unfortunate plight should be protected by the right hon. Gentleman and the Ministry of Labour. He ought to receive unemployment allowance. In existing circumstances no case can be made for depriving a single unemployed man from his benefit. It ought not to be a question of stamps or a question of whether a man is running all over the place seeking work. The simple condition should be laid down that if the Ministry of Labour itself cannot offer employment, then these unemployed persons should receive unemployment benefit. That is a constructive proposal. What is wrong with it? I presume the right hon. Gentleman will object on the ground that unless some kind of pressure is exerted by his Department, men will not seek work; and yet he admits that no work is to be found. As a constructive proposal, therefore, I suggest this is well worth his attention. I speak feelingly on this matter, because I have addressed to the right hon. Gentleman and his Parliamentary Secretary dozens of letters relating to cases of men who have been turned down by the local Employment Exchanges, on the ground that they have not sought employment, and yet, when I have approached managers of Employment Exchanges in local areas, they have admitted to me that there is no employment to be found in the area. That is a definite principle—that men should be maintained, however inadequately, by such allowances as are provided by the State. Do not come to us and talk about the lack of constructive proposals until you are prepared to apply that, very important and fundamental principle, that men who are unemployed should be properly maintained.

I come to the question of the trouble in the mining areas. We had last night a speech from another member of the Government, the Parliamentary Secretary to the Board of Trade, who indulged, to the huge enjoyment of himself and the Members associated with him, in cheap gibes at the expense of my hon. Friend the Member for Smethwick (Sir 0. Mosley), who has seen fit to dissociate himself, quite properly, from the Conservative party on the ground of incompatability of temperament, and no doubt, because of other reasons. The hon. Member for Reading (Mr. H. Williams) no doubt, speaking to the Government book, declared that the problem of the minefields had arisen since 1926, and that therefore it could not be due to the reversion to the gold standard. I do not propose to discuss this afternoon the reversion to the gold standard. I am not very much concerned with that, because I know there was a mining problem in 1924, and there was a mining problem in 1923 and equally there was a mining problem in 1919, so much so that the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) was impelled to establish a Commission to deal with the problem. It is idle to pretend that the problem is a new one, that is, that it is due to 1926 or 1924. For that matter, I do not pretend that it is due to any act of the Government. I believe the Government aggravated it by the introduction of the Eight Hours' Bill, but the Government are not entirely responsible for the existing parlous plight of the miners or the mining industry.

The hon. Member for Reading said that in 1924, as a result of some act of the Labour Government, unemployment in the mining industry had increased. He did not submit the figures, but he, apparently, forgot that in 1923, as a result of the dislocation in the Ruhr, there was an artificial advance in the coal trade of this country, and, possibly, if it had not been for such dislocation, there would have been a crisis in the mining industry long before 1924. What is the solution of the problem? As I understand, the Government propose to transfer miners who are unemployed from the depressed areas to districts where employment can be found. Does the right hon. Gentleman pretend that that is going to solve the problem, or going anywhere near to its solution? it can have very little material effect upon the problem There are close upon 300,00 miners unemployed, and, according to the right hon. Gentleman's own estimate, in six months 15,000 may be transferred, that is, if the scheme works efficiently, if we are to judge by the manner in which the recent migration scheme operated, there is no guarantee that the internal migration scheme will operate any more efficiently. In any event 15,000 men are to be transferred in six months and 5,000 men emigrated—20,000 all told. If there are 300,000 miners unemployed, and you are to transfer and emigrate at the rate of 20,000 in six months, bow long are we to wait before this problem is dealt with and disposed of? There is something more. Can the right hon. Gentleman give us any assurance that as men are transferred and emigrated there will be no increase of unemployment in the depressed areas?

What is the cause of the unemployment in the mining industry For one thing, we have the eight-hours legislation, for which the right hon. Gentleman and his associates are responsible. If he wants a constructive proposal, I will give him one. Repeal the Eight Hours Act. If you go back to the seven-hours' day in the mining industry you will absorb from 50,000 to 70,000 miners. The mineowners will tell you so. Ask them; they are your friends. If, in making this proposal, I am met with the objection that it will lead to an increase in the cost of production, I would meet that in this ray. You may effect economies in the mining industry by removing middlemen's profits, which bear very heavily upon the coal consumer. You may go further, and discover whether in the course of the transfer of coal from a colliery undertaking to an allied undertaking the economic price is disclosed. You will find that there is a margin available for the purpose of meeting the increased cost of production if the seven-hours, day were once more operative.

The Parliamentary Secretary to the Board of Trade and the Chancellor of the Exchequer say—and this appears to be the Government's case—that if we are to improve the trade of the country we must export more coal and more of other goods. Take the case of coal. You may reduce the cost of coal by 3d. a ton, but there is no assurance that you will increase Continental consumption. Do you think for a moment that the Continenta coalowners will allow you to extend your influence on the Continent, and that when you embark on adventures of that kind they will stand still and do nothing? Every step taken by British coalowners in the last two years has been met by corresponding movements on the part of the Continental mineowners, and, if you reduce the cost of the coal exported to the Continent, you may depend upon it that the German and Polish coalowners and the others will be compelled to act correspondingly. Therefore, that is no solution of your problem. Take the facts. The right hon. Gentleman was prolific of facts. I advise him to go to the statistical summary presented by the Mines Department, and he will discover that the mineowners have been selling coal below cost of production for a considerable time. They are doing it now.

What do you think of a boasted capitalism in the mining industry that is compelled to sell its commodity at an artificial price actually below the cost of production, and to dump coal into Continental markets? What are we to think of the last statistical summary presented by the Mines Department for the quarter ending June, which shows that the proceeds, after the disposal of all coal in this country, were really less by is. 5d. per ton than the cost of production. How will your 3d. per ton operate to bring costs down so that more coal can be exported, and so that we may enter into competition with the Continental mineowners on more favourable terms? It simply cannot be done, and the mineowners of this country know it. They are very grateful for any financial assistance you may offer, and for the removal of rating burdens, but they are laughing up their sleeves at the attitude of the Government. They know that the Government cannot render any assistance in that direction. I will go so far as to say that if you can absorb 50,000 to 70,000 unemployed miners in their own districts by reverting to the seven-hours' day, even if it cost the Government something, it will be much better than continuing to pay the unemployment allowance. It is a method of dealing with the problem much more satisfactory than the opening of relief works or the continuance of unemployment benefits.

As to the question of research, I have listened to speeches in the course of this Debate on that subject, and I have wondered whether those who have been responsible know anything about these matters. For example, we have heard the right hon. Gentleman the Member for West Swansea (Mr. Runciman), whose capacity is admitted, and whose remarks are always listened to with interest, speaking of the advisability of research. Has it never occurred to hon. Members that the fruits of research are passed into the pockets of private interests? Even the Government's Fuel Research Department tests the apparatus and plant of the low carbonisation companies, which are now operating in this country, and it is very largely upon these tests that companies are being floated and the interests of speculators advanced. What is the advantage to the community if these interests compete against each other, and at the end produce something of a full blown scheme of scientific treatment of coal that enhances their own interests?

May I make another constructive proposal? Instead of leaving private interests to compete with each other, one to promote the Bergius scheme, others the high temperature carbonisation scheme, and others the low temperature carbonisation scheme, the Government should co-ordinate the schemes, and not merely engage in experiments but deal with the matter on a commercial basis. It 2an be done. The Government took a very short step in that direction not long ago when they arranged a contract between the Fuel Research Department and the Gas Light and Coke Company for the installation of plant at the company's premises, where one hundred tons of coal were to be treated daily as a commercial proposition. At the end of three years, however, if the process is satisfactory, the plant is to he handed over to the private company. What is the advantage of that? All the fruits of these experiments in the scientific treatment of coal, of inventive genius, and the like, should flow to the community and not be the means of advancing the interests of private shareholders. A number of these companies have been recently floated. The Illingworth process, one of the best in the country, has become the subject of a limited liability company's operations, and the same thing is happening elsewhere. I want the Government to spend a considerable amount of money in research, and as to that we have had no information from the right hon. Gentleman and his friends.

What are the Government spending on research Say what you like about the Labour Government, but when in 1924 we found the Fuel Research Department starved and unable to proceed we managed to secure for them a grant of £30,000, and they have gone on ever since. What are the right hon. Gentleman's Government doing about research now? Leaving it to private enterprise. That is not enough. The right hon. Gentleman shakes his head. Then let him tell us what is being spent by the Government in the promotion of research. I venture to say that it does not reach £100,000 annually. That is not enough. It is not to be compared with the money spent by Governments abroad; and if money is to be expended, then I say the fruits of those experiments should come to the community.

As I visualise it, the problem is not so much one of finding work for the unemployed as of finding the means of maintaining them. Trade is bad, and the prospects, although regarded with optimism by the other side, do not appear to us to be so bright. We deplore this state of affairs and we wish that trade would become better, but there are the facts, and they are not lightly disposed of. There is unemployment. Neither by your transference schemes, nor your migration schemes, nor by Lord St. Davids proposals, nor by the de-rating proposals can you grapple seriously with the problem of unemployment. You may attack it on all sides, and I do not complain that the Government are doing so, but they must go much further. Since private enterprise cannot find work—that is admitted—and since the Government regard it as the duty of private enterprise and not of Government to provide work for the unemployed, at least the Government, as representing the community, should come to the assistance of those unfortunate persons and provide a large measure of maintenance, and do it without stint, do it not as an act of charity but as a right and as a privilege conferred upon those persons.

Lastly, I warn the right hon. Gentleman that we shall not take lying down his refusal to provide allowances for genuine unemployed persons in mining areas. I am sick and tired of the action if local employment exchanges. Having written time and again to his Department, I find we get a stereotyped reply, saying that the Court of Referees has disposed of the matter. The men cannot even proceed to the Umpire, and when they do precisely the same thing occurs. There have been dozens of cases, and we cannot stand it much longer. Whatever proposals are adopted by this House, and whatever may be thought of the Government's proposals, the Minister should come to the assistance of these men by providing unemployment allowances for them in their time of stress and tribulation, without any attempt to impose conditions which, in the circumstances, are not justifiable.

Mr. LUMLEY

I would like to add my word of welcome to the Minister of Labour on his restoration to health and his return to his duties in this House. He holds a position which I believe nobody in this House, however ambitious he may be, envies, and when to his burden of office is added a burden of illness, I am sure that he must receive sympathy from all sides of the House. I was very glad to hear that the Minister and his Department intend to push on with this work of transference. When it was first taken up after the issue of the Industrial Transference Report, it struck me that the Government were in for a very difficult time. The scheme was open to ridicule and misrepresentation, and it has received both in full measure. It is also open to criticism from opponents and from friends, but although I believe that in some directions it is necessary to criticise the steps taken, yet, on the whole, and looking at it from the point of view of those people who reside in the depressed areas and who, if no help is given to them, will have a very gloomy outlook, I think the Government must go on with this very difficult task of attempting to transfer them to better areas.

I rose principally to raise two points. I was glad to hear in the speech of the Chancellor of the Exchequer yesterday that the Government intend to give increased assistance to local authorities for public works which will have the effect of relieving unemployment. But I am not quite sure to which local authorities that assistance will be made available. My hon. Friend the Member for Wakefield (Mr. Ellis) questioned the Chancellor on that subject, but after reading the letter which has been addressed to the local authorities and reading the Chancellor's reply to my hon. Friend, I am still a little in the dark, and I ask for further enlightenment. I understand that a local authority in a prosperous area will receive assistance on condition that it will give employment to miners from the very depressed areas, and I understand also that a local authority in a depressed area will also receive assistance, but what I want to know is what happens to a local authority which, while it has bad unemployment in its area, too bad for it to be able to offer any employment to miners from other areas, is yet not bad enough to be classified as a depressed area? I hope the regulations will not be drawn too tightly, and that any reasonable scheme which will give a considerable volume of employment locally will be considered on its merits and, if possible, be given assistance.

I am not speaking in a general sense only, because I have in mind a public work which could be undertaken in the city of Hull, which I have the honour to represent. It is a work which would be of economic benefit to the community. It has already been brought to the attention of this House, but has not so far received a grant from the Government. It is the work of doing away with the level crossings which surround and go through the heart of the city. An agree-merit has been come to between the local authority and the railway company concerned, and the only thing which has prevented it from being put into operation is that it has been impossible to obtain either from the Ministry of Transport or from the Unemployment Grants Committee a sum which would enable the two parties to go forward with this scheme. I mention this because there are in Hull a considerable number of unemployed. Since 1926 the number has hardly ever fallen to below 12,000. Although Hull is not classified at present as a depressed area, I would remind the House that in that volume of unemployment there are very depressed categories. To be unemployed is a hardship to anybody, but if I were asked to pick out those to whom unemployment is the greatest hardship I should say they are the people who become unemployed at about the age of 40. If they have become unemployed because the industry in which they have perhaps been working all their life is in a bad way, there is very little chance for them, or at any rate, not so much chance as for younger men, to get work elsewhere. In such cases it is not the least adaptable men who would be employed but the younger men. In a city such as Hull unemployment may not be so bad in volume as in other areas but it has its depressed categories, and I hope the regulations will not exclude cities of that description from being able to give assistance to their depressed areas.

Another question I wish to raise is in connection with unemployment. insurance. When the Minister of Labour introduced his Unemployment Insurance Bill last year some of his supporters, including myself, expressed disagreement with the condition known as the 30-contributions rule, and we differed from the forecast which the right hon. Gentleman then put forward that unemployment in the months following the introduction of the Bill would improve so much that only a very few people would be found who would be unable to fulfil that condition. As a matter of fact, what has happened since has fully confirmed our fears, and hope that in the Bill to be introduced next week we shall be able to modify or postpone the condition applying to 30 contributions.

I have no wish to exaggerate in regard to this question. I have endeavoured to obtain from the city which I represent some figures. I know they form a rough and hasty estimate, but lit is an estimate given to me from a reliable source, and it shows that the number of people in my district who would fail at the present time to fulfil the conditions of 30 contributions is between 1,500 and 2,000 out of a total of roughly 12,000 on the unemployed register. This means that between one-sixth and one-eighth of the total would fail to fulfil that condition. That may not appear to be a very serious matter, but I think it is serious. The problem which we have to face in the city which I represent is not as had as in some other depressed areas. In my district the problem, generally speaking; does not involve very long periods of unemployment. In the case I am raising there is a good deal of labour on the docks which is of an intermittent kind, with many short periods rather than long periods el unemployment. My point is that if in a place like Hull, wherethe problem is not so accentuated by long periods of unemployment, we fail to fulfil the 30-contributions condition, it must he much worse in mining areas where long periods of unemployment have become the rule. Those are the two points to which I wish to draw the attention of the Minister of Labour, and I hope I shall obtain some assurance upon those points.

Looking at the problem of unemploymeent generally, no less than four Governments, representing different political parties, have tried to deal with this question, and it is obvious that this problem is so difficult that with the best will in the world it is impossible completely to solve it. I think that must be fully realised by everybody in this country, and, although the present Government have failed to solve it, I think the people of this country are looking forward to see which political party has the best contribution to make towards its solution. I am surprised that the Opposition have so far not thought it to be their duty to produce alternative proposals for the solution of this problem. As long as they remain silent about what could be done to alleviate this difficult problem, I am convinced that the proposals of the Government, particularly those relating to de-rating, will hold the field as the only constructive and workmanlike proposals to help our industries to employ more workpeople.

Mr. MARCH

I intended to deal with the two points which have been raised by the hon. Member for East Hull (Mr. Lumley), namely, the St. Davids Grants Committee and Insurance, but I will simply content myself now with saying that I endorse all the hon. Member has said in connection with those two questions. I wish to refer more particularly to the question of the transference of workmen from one district to another. The Minister of Labour seems to think that the transference scheme is doing a great deal of good, but he ought to find out from the employment exchanges what is really happening.

Sir A. STEEL-MAITLAND

I take no praise myself, but I take a great deal for those officers who have worked in my absence.

Mr. MARCH

I will tell hon. Members what effect the appeal to employers has had in my district as affecting at least two firms who have taken on men who have been transferred from other districts. I am quite certain about one of these cases because these men who have been transferred have to obtain lodgings and they displace other men. I am informed that their wages are from 5s. to 6s. less than was being paid to the men whose jobs they have taken. That kind of thing is very distressing to the people in the districts where it happens. I may add that there is not an abundance of accommodation for lodgers in the district which I represent. We have been doing our level best to relieve overcrowding, and, if you are going to bring more men into a district like that which I represent, the result will be that you will increase overcrowding, Naturally, the people of my district are anxious to earn money by taking in lodgers. I hope the Minister will get his officials to give him a return of the number of men who have been displaced in those particular jobs in my Division. I take it that it is because the employers happen to be Government contractors in a very large way, and although at the moment they are not doing Government contract work, I suppose that being Government contractors, they did not desire to offend the Prime Minister, or even the Minister of Labour, by not finding some employment for these people when the representative of the Employment Exchange visited them.

The men also complain that the Minister of Labour himself does not try to carry out the principle of finding work for those who are unemployed. I have a letter from a friend of mine in Weymouth who asks me to call attention to a matter of this kind. The Portland Employment Exchange for some time has had a part-time manager, but the extra number of unemployed people registering has ca-used more work, and application was made to the Weymouth Exchange for more help; and the Weymouth Council decided that they would apply to the Ministry of Labour for a full-time manager for the Portland Exchange. The Ministry a-greed eventually that there ought to be a full-time manager at Portland, and applications were invited for the position. I am informed that 60 applicants were interviewed, mainly unemployed persons from the Weymouth and Portland district, but in the end the appointment was given to a tax collector who was already getting £4 or £5 a week. He was evidently considered to be better suited for a manager's job in an employment exchange than any other of the 60 applicants. That is another transference which I suppose the Minister thinks is a good thing—the transference of a man from the position of tax collector to that of manager of an employment exchange; but it does not relieve unemployment even in one instance, and we do not think that it is a very good way of utilising unemployed people.

2.0 p.m.

As regards any further transference, there is no need to send any transferred men into my Division, because we have had men unemployed for eight and nine years in all grades of work, such as shiprepairing yards, iron yards, railways, docks, and so on, and yet men are brought in to do labouring work in the jobs I have mentioned. The dock workers in my district are very much upset at this, because, during the carrying out of the dock improvement which is going on, one of the dock entrances is closed and prevented from receiving shipping, so that nature ally there is not the amount of work brought there that there would be if the entrance were open for traffic. The result is that the men have to stand off and hang about. Some of them have been getting the opportunity of a day or two's labouring in this work, but now they stand no chance, because transferred people are brought there in that way. As in the district of the hon. Member who has just spoken, there is a great deal of casual work in our district, where we have five docks, and these men would jump at the opportunity of getting a day's labouring in the docks or in the yards when no shipping is coming in. Theirs is casual work by the halfday, and the result is that these men sometimes work only two or three half-days a week. They have to pay the full insurance contribution, and yet do not qualify for benefit because of the waiting period, and the result is that these men who are under-employed are harder hit than those who have been in regular employment and have become unemployed through a, change in trade or something of that kind. I think that these things ought to be remembered, and that full opportunities should be given to those who are getting very small pay through under-employment of that kind.

There is also a feeling among the men in the district, and probably it prevails in many other districts, that the Exchange officials have instructions to give, to men who have just recently become unemployed after having been in fairly regular employment, a preference in any jobs that may be available, as against men who have not done any work for two or three years, and who, of course, are struck off benefit, though they may still continue to report themselves at the Exchange to see if there is any possibility of work for them. They are told that there is no work, and yet they can see men who have just recently commenced to sign on sent to jobs while they are left behind. There are probably two reasons for that. One is, I suppose, that the Government may save a little money to the Unemployment Insurance Fund, and the other that an employer would prefer men who have just left off doing regular work, because they would be more fit than the other poor wretches who have been half-starved for five or six months, or perhaps a year. Consequently, there is a great deal of dissatisfaction and discontent, and I do not wonder 'at it, but the Minister of Labour and the Chancellor of the Exchequer seem to be satisfied that things are going on very nicely because we are not so bad 'as some other countries. We do not, however, happen to be living in other countries and to be dependent upon other Governments in other countries for doing something for the unemployed.

We live and work and pay taxes in this country, and we naturally expect consideration from this Government in this country. It will not relieve the unemployed one bit to tell them that New York and Russia and Germany are worse off than we are here. We can say that we are had enough off, and are sorry for their plight, but at the same time we expect this Government, who depend upon us when they want us, to do what they possibly can for us in our hour of need. That is no satisfaction to unemployed men and women who are half-starved. It reminds me of the stories that used to go round when the clergy or some of their visitors used to visit the sick, as they probably do now. When they had heard the sick person's story and condoled with him, they would say, "You are not half so bad as the one I have just left in the other street." That is not much consolation to a person who is very ill, and this is not much consolation to the men who have been unemployed all this time and are desirous of work. It will not help them very much, and transference will not help them at all.

With regard to juvenile unemployment, the Minister consoles himself by stating that the number is not 70,000, as men- tioned by the right hon. Gentleman the Member for Colne Valley (Mr. Snowden). If there are not 70,000, there are enough unemployed in the districts of East London to fill all the posts that are going in the City, without bringing anyone from Wales or anywhere else. My wife happens to have been for a long time a member of a juvenile unemployment committee, and she knows very well that they are continually sending boys from East London into the City to see if they can get the situations which are announced as open for them.- Frequently those boys, and girls too, have to walk there and back again, because they have not 2d. to pay the fare. In a case of urgency, the Ministry's representative can pay their fare, but that does not very often happen; what generally happens is that someone on the committee with a little sympathy finds the halt-pence for them to ride. Men and boys and women are being, as the last speaker said, buffeted about from one place to another, and then, in the end, those who are entitled to benefit are told that they are not genuinely seeking employment. I agree with my hon. Friend the Member for Linlithgow (Mr. Shinwell) that, if men, women and boys go to register at the Employment Exchanges at the times regulated by them, that ought to be sufficient to show that they are genuinely seeking employment, because if they were not, they would not go to the Exchange to register. It is nearly time that the question of unemployment benefits was taken into serious consideration and amended as quickly as possible.

Mr. LOUIS SMITH

I am encouraged in rising to-day for the first time because I read in the Gracious Speech many paragraphs which in my opinion as a business man will benefit trade, and particularly find more employment for many of His Majesty's subjects among the working-men. I consider that the problem of unemployment, as we have heard several times during the last day or two, is by far the greatest problem which the Government has to solve. In six paragraphs in the King's Speech measures are outlined which will benefit the workers and alleviate unemployment. We read 'in the Speech freight relief, industrial transference, de-rating, an extension of export credits guarantees, and also agricultural credits in Scotland. All these in my opinion will help to alleviate unemployment. In connection with the freight relief and de-rating proposals, I think manufacturers are not sanguine enough as to the benefits that they will receive, both from 1st December and also in October in next year. For instance, when, as I am told, 10 per cent. relief in freights is given from 1st December, not only will the iron and steel industry obtain that advantage, but it will also obtain further relief through the amended conditions in the coal industry.

My home town is in an agricultural district, and I can see a very distinct act-vantage that is to he gained by the farmer. Ail the artificial fertilisers, the feeding cakes that he buys and seed potatoes that he will require from Scotland will come down from 1st December at reduced rates. In addition, he will have less freight to pay on all the produce that he sends out from his farm. Although we are not given as yet the full amount of the advantage, so far as I can gather, it may amount approximately to 1s. a ton on everything going on to and coming off the farm. That surely will be a help. I am not personally in the iron and steel industry, but I am connected with engineering works, where we purchase iron and steel to a considerable extent, and, in considering the de-rating proposals, I find that in one engineering concern, whose assessment up to the present has been around £24,000, when the adjustments are made under the Valuation Act, 1925, and the estimated poundage is taken into consideration, from 1st October, 1929, the firm, which has been paying just under £20,000, will nay between £4,000 and £4,500. When all the manufacturers in the country realise that such a large percentage of relief is to be given them on the rates they pay, they will indeed he gratified with the proposals that have regard to de-rating, and they will see that alleviation of unemployment may follow when the scheme is in full work.

May I speak for a moment on industrial transference? In a small town quite close to my home we have fortunately for many years had little or no unemployment. I think unemployment has been controlled to a great extent by the enterprise and shrewd policy adopted by a firm manufacturing ball-bearings, principally for the motor trade. I have been informed during the last few weeks that several young fellows from the mining districts have been transferred to Newark, and from the employment of mining have been put on to the manufacture of ball-bearings. When one considers that young fellows between, say, 18 and 21 in South Wales might be hanging about for two or three years doing nothing, we are indeed grateful to know that measures are being taken to remove them into employment such as the manufacture of ball-bearings, where there is a good deal of work being done.

One matter on which I ask permission of the House to speak was referred to yesterday. It is with great regret that I hear that a contract of the value of £70,000 has been placed by one of our British contractors undertaking work connected with the Singapore naval base in the United States. I happen to know something about excavating machinery, and personally I have been very proud to know that, during the last 10 years particularly, one or two British firms have not only competed most favourably with firms in the United States but in many cases, and particularly in connection with canals being built in India and work done in Australia, have competed most favourably, not only obtaining contracts but carrying them out in a shorter time and with more efficiency than even the American concern to which this contract has been given.

May I, on the Floor of this House, appeal to manufacturers and contractors in this country to explore to the fullest possible extent all channels before placing a contract in a foreign country? We cannot spare such work as this involves, and I do think that we should use our influence wherever we can to persuade all those who have contracts to place to say and to live up to the principle that British contracts should employ only British working men. In this contract I know that there is between 1,000 and 1,200 tons of steel involved. In that steel is involved also the purchase of 4,000 tons of coal. There is all the loss to this country of the freight, the carrying of coal and steel from works to the excavator works and possibly also to the port at Singapore. It seems to me that a good deal of unemployment would have been relieved if that contract had remained in this country. In conclusion, may I say that I am proud to be a supporter of the policy and the measures which His Majesty's Ministers have outlined in the Most Gracious Speech, and l have confidence that we shall see certain alleviation of unemployment ensue during the coming months.

Mr. SNELL

I am sure that I shall have the whole House with me when I congratulate the hon. Member for Hallam (Mr. L. Smith) upon a most successful, earnest, and suggestive maiden speech. It has had unusual balance and yet has had clarity of thought which will make us all wish to hear him on future occasions. While I certainly do not grudge the concentration of our thoughts upon what are called the depressed areas and especially the situation in the mining districts, I think that it is most important that the House should remember that the unemployment problem is one which extends over the whole of the nation in one particular or another. There is some danger of our forgetting the general problem in the over emphasis of tie concrete problem of these particular districts. The one satisfactory feature in the speech made by the right hon. Gentleman the Minister of Labour was the welcome evidence it gives of his return to health. Otherwise, the speech itself was a depressed area of the most profound character. It appeared to offer to us no hope of any real substantial amelioration of unemployment.

I was strengthened in that impression by the character of the speech which was made yesterday by the right hon. Gentleman the Chancellor of the Exchequer, who put his views before the House with a quite unusual modesty and moderation, which showed that in his mind too the Government were approaching a period when they need rather to apologise for their existence than to boast of their record. The Minister of Labour, and the right hon. Gentleman the Chancellor of the Exchequer too, emphasised to an unusual degree, the advantage that was to be obtained from this policy of transference from one area to another. The only thing which I regretted in his reference to that matter was his suggestion that we on this side of the House wanted to crab that work and to reduce its value. There is not a man on this side of the House—indeed in any part of the House —who would hesitate to extend the very fullest help in bringing men from a depressed area to another area where they would have a chance to join in the general stream of the nation's life.

The situation is very complicated and most difficult. Take the area to which I belong. There, the Government have some real responsibility, and at I he very time when they are asking local, authorities to make room for unemployed men from other areas and to import them into their own, they are themselves discharging their own workmen in the borough of Woolwich and elsewhere and increasing rather than decreasing the unemployment problem. I have the experience—an experience which I feel is common to every Member of this House—of receiving from my constituents week after week most pathetic and appealing letters asking me to do something to get them work, and yet all the time we are asked to believe that the unemployment problem will be solved by bringing unemployed persons from one area to another area. The one thing to remember about this policy of transference is that it does not increase the total employed of the country and that if one person is employed some other person is not employed. All that it does is to bring some suffering persons from a very bad area into an area which is less bad.

The Minister of Labour suggested that our duty was to attack this problem from all sides, but he approached it only from several sides, none of which would be effective. Remember that thee are apparently 250,000 people in these mining areas who, we are told, will never be employed again in that particular industry. Yet, the Government in face of that situation have the courage to come before us and say that if this scheme goes well in the process of six months' time smile 16,000 people will have been removed from one area to another. That is not facing the problem. That is merely evading the problem, and it seems to me that after four years the Government come before us merely because they are approaching a period when they will have to give an account of themselves to the Nation. We know that hon. Gentlemen on the other side do not regard this un- employment problem as an insoluble one. We know that they think that it is quite easy of solution, because within six weeks after the Labour Government were in office, under conditions which made them helpless to do really effective things, a Vote of Censure was moved from the other side of the House to the effect that we had not in six weeks' time solved the unemployment problem. Therefore, it must be easy of solution according to the opinion of the Government, and yet, four years have gone by. They have had unparalleled advantages. They have had a dumb and docile majority. They have had a House of Lords which if it has not been very humble has, at any rate, been a very obedient servant. They have bad a megaphone Press. They have had every advantage. They have had the money whereby they could control research expenditure, and yet unemployment figures have gone up year after year. Now they come before us and say: "Do this thing for us and in six months' time we shall probably remove 16,000 persons from one area to other areas where employment exists." Whatever else that scheme may be, it is not a solution of the unemployment problem. It is altogether too cautious and too disappointing.

I should like to make a most solemn protest, so far as it is of value, against the practice of Ministers on the other side of the House, and other people in prominent positions, in regard to the declarations which they make on this matter. I have noticed for several years that one false prophecy after another has deluded the public in regard to unemployment. The economic theorists and the great financiers of the city have all said: "The bad times are ended. We are going now into a period of great promise." That has been said over and over again. A couple of years ago, I heard a Member of this House, Lord Melchatt—whom I listen to with very great deference on any matter affecting the industries of this country—state in this House: "As sure as I stand here, we are going to have a boom in trade." I was amazed at that statement. I did not see the beginnings of the opportunity for any such expansion. I want to protest against people coming to this House or speaking elsewhere and making these vague prophecies, when there is nothing of substance behind them.

The subject is difficult enough in all conscience. At least, do not let us delude the people by telling them that if they only hang on and starve, the situation will come right Of itself. The conditions for an improvement of trade do not really exist. If the Government have not actually shut the gates between ourselves and trade communication with Russia, at any rate they have not opened the gates, and they have made those trading relations far more difficult. The problem of unemployment is not to be cured by methods such as have been suggested to us by the Government on this occasion. It is a permanent question unless we face it with a greater courage and a greater knowledge than we have hitherto done. The Chancellor of the Exchequer told us yesterday that no nation on earth had done so much as our own in regard to the sufferings of the people in these bad times. With that he had the whole House with him. There is nothing wrong with this nation's heart; what is wrong with it is the Government at its head. We are entitled to say that what the nation requires is that this subject should be faced in a way that it has never yet been faced. I speak for no one but myself, but I have always felt that the importance and urgency of this question requires an all-parties committee to sit and inquire, to conduct research, to explore the avenues and make suggestions, and it also requires that the Government in power, of whatever party, should implement the suggestions that such a committee might make.

The Chancellor of the Exchequer and the Minister of Labour rather conveyed the suggestion that this stream of unemployment came from one particular source; that it was not the mines but the general strike or something of that kind. That is an evasion of the real problem. The stream of unemployment has many tributaries and it has to be attacked not in one way by means of transference but in many ways, by all the ways we would apply ourselves to the problem if it affected our own businesses or cur own lives. The hon. Member for Hull, East (Mr. Lumley), quite rightly, reminded the House that a part of the unemployment problem was a human problem, affecting the character and capacity of the working people themselves. There are, first of all, those who have been in regular employment—solid men of high character and capacity. Fashion alters, the demand for their particular service passes away and they are out of work, and by the very nature of their training and their character, they are not as well qualified as they might be for getting other jobs. There is a certain knack in getting a job. A man must not take "no" for an answer; he must have the power of putting his own need before other people, but all of us have not that power. These people represent a very special problem.

Fallowing these, there are people who are engaged on short contracts, and always between their jobs they have a period of unemployment. Following these, there are those who are engaged in casual labour—labour at the dock side, of which the hon. Member for Poplar (Mr. March) recently spoke. They get an hour or two of work on one or two days a week. They are nearly always unemployed a large portion of their time. Then there are those of whom the Chancellor of the Exchequer spoke yesterday as the weaker brethren, people who have not the stuff in them or perhaps not the food in them to maintain themselves properly. Whatever these people are, they belong to our blood and our race and the problem of unemployment cannot be solved unless it is approached from these many sides, which will includ3 all these different sections of people.

I do not wish to debate the matter further to-day but I would express my own solid belief that if we approached this problem with the same seriousness that we should approach other problems if they came before us, we should, somehow, find a solution of it. I have no doubt about that. There must be some refuge somewhere if we put our minds to a solution of the problem. The existing condition of things is a discredit to the Government and a discredit to the nation and ought to be ended. As it stands, it is a thorn in our sides, and those of us who are not personally unemployed, feel the shame and suffering of it and we should do our very utmost to end it.

Mr. LLOYD GEORGE

I agree with the hon. Member who has just spoken that this problem of unemployment ought, at last, to be faced in a way which it has not been faced before by any Government, and I include my own. I am not so very much concerned about censure or its distribution as about a real invitation to the Government and the House to face the problem and take their courage in both hands. We are beginning now the ninth year of abnormal unemployment. The number of unemployed is larger to-day than it was six years ago, when I left office. The Chancellor of the Exchequer, yesterday, quoted the figures of 1908 and said that they ran up to 1,000,000 then. I think he was inaccurate, but it does not really matter, lie referred to the very high figures of unemployment which we find now and again even in highly prosperous countries like the United States of America and others. That really is not doing justice to the problem. In 1908, no doubt, there was a cycle of bad trade, which passed away in a very short time. We reached a peak, which was a high one, and descended very rapidly. In a short time, we returned to the normal, and in another year or two we had quite abnormal prosperity. The same thing applies to the United States of America. You have had high peaks there, but if you take into account the population I doubt whether it has ever been quite as high as that from which we are suffering at the moment. That does not matter. It passed away and you had exceptional experience of feverish prosperity.

It is really like a temperature chart. There are periods when the temperature rises rapidly. If the strength of the patient holds out he overcomes the evil; the temperature is reduced, and he soon returns to the normal. There is another class of case where the high temperature continues for a very long time, as in wasting diseases, where whenever the doctor uses his clinical thermometer he always finds it above the normal morning after morning, and his effort is always to try and reduce the temperature and increase the strength of the patient to enable him to overcome the insidious evil. That is a very exhausting form of disease; and it is the case here. It is the case of a cons tinned temperature lasting for eight years. We are now in the ninth year, and it is undoubtedly eating into the very vitals of the strength of this country. It is the duty of any Government and every Government to take it in hand as the one supreme problem that dominates all others.

I said that I was not anxious to have any recriminations. I am much more concerned about considering the way in which we are going to meet the situation. I do not take the view that it is not the business of those who are not in office to make suggestions. I deprecate that view of the situation. We are all of us here representing the 40 odd millions of people in this country, millions of whom are suffering from unemployment, and the rest of whom are depressed with the anxiety it creates, and it is our business, if we have any suggestions to make, to bring them before the Government of the day, urge them upon the Government, and, if they reject them, then the responsibility is theirs. If we do not make them, the responsibility is ours.

I am bound to say something about what the Chancellor of the Exchequer said yesterday before he came to the constructive part of his speech. Although I am not going to indulge irk any recriminations, the Chancellor of the Exchequer must not use that in order to avoid criticisms and censure. I do not agree with him that part of the responsibility, and a considerable part of the responsibility, does not rest upon the Government of the day. I would not make this point if it were not, necessary in order to base upon it one constructive suggestion that I am going to make. I thought it was a grave blunder on the part of the Treasury to return to the gold standard in the very precipitate manner, the very hurried manner, they did. They did not emulate the caution and prudence with which continental Powers have restored their currency. The French, if anything, erred on the side of caution, but they avoided damage to their export trade, which was not the case here, as the result of the advice the Chancellor got in 1925, and upon which he acted, in my opinion very unwisely. A remarkable speech was delivered last night by the hon. Member for Bolton (Mr. Hilton). He pointed out how disastrous the effect of that action had been upon the cotton industry in Lancashire. There is no doubt it hit the export trades of this country very hard. In fact, it hit them a reeling blow. It practically added 10 per cent. to the cost of their goods in foreign markets, without putting that 10 per cent. into the pockets of the people at home, and, as we are trading on a very small margin, the effect has been very serious.

I could produce figures to the House showing how immediate the effect was and how it is that we have not recovered up to the moment from it. On the coal trade the effect was calamitous. It added Is. (ld, per ton to the cost of our coal in foreign markets, with the result that it gave that advantage to our foreign competitors; it precipitated the terrible struggle which, without apportioning blame one way or the other, has had undoubtedly considerable effect in retarding our recovery. The right hon. Gentleman cannot blame altogether those who conducted the affairs on one side without accepting himself the responsibility for the initial step which produced that terrible conflict in 1926. An hon. Member yesterday referred to a speech delivered in 1925 by Lord Melchett when he was a Member of this House. He spoke in the Debate on the Board of Trade Estimates, and the words he used were somewhat prophetic. He said: If we make up our minds that we do not want to export, make up our minds that our export trade is gone, and that import trade is all important, that what we want to do is to buy and not sell, then, obviously, the return to the gold standard is a right policy; hut there is not a single human being I have met in this or any other country who would not agree that the return to the gold standard means an appreciation in prices of something like 11 per cent., and is a further bar to exports."—[OFFICIAL REPORT, 6th July, 1925; col. 85, Vol. 186.] If the right hon. Gentleman the Chancellor of the Exchequer will take the trouble to follow the course of the export trade since then he will find how immediate the effect was in handicapping our exports in markets where we were only capturing the trade on very narrow margins. The right hon. Gentleman cannot get up at that Box and arrogate to himself the position of a person who can criticise other parties in this House for what they did or failed to do without accepting a very substantial share of the responsibility himself. I could point out one or two other considerations, and they also bear on the suggestion that I shall make.

I think that the policy of the Treasury altogether has been wrong, in view of the difficulties that we have in recovering our export trade. There is a lack of resilience and of buoyancy, whereas other countries are recovering much more rapidly. I agree with those who say that the Treasury policy is very largely responsible for that and for the restriction of credit. The Treasury are subordinating everything to the conversion which they know is coming; they are considering favourable terms for that conversion; and all the needs of the industries of this country are just subject to the one aim and purpose of securing good and favourable conversion terms, I think it is next year. The night hon. Gentleman may succeed in having more favourable terms, but after all it will be at the price of the great business and trade and industry of this country. It is far better that you should have a prosperous industry in this country than that you should be able to knock one-quarter or one-half per cent. off your conversion schemes next year. The right hon. Gentleman can find the result of the policy, even from the Treasury point of view, in what is happening now with regard to Income Tax. Whether or not Income Tax will recover in a year I do not know, but at the present time it seems to me to be going down. I say that from the returns that have been published.

Mr. CHURCHILL

We must wait for the figures of the complete year.

Mr. LLOYD GEORGE

I have taken all that into account, and so far it is a very disappointing return.

Mr. CHURCHILL

The right hon. Gentleman need not mislead himself on the subject. I am advised that there is' nothing exceptional or adverse in the returns so far.

Mr. LLOYD GEORGE

In the first place there is the fact that the right hon. Gentleman had to budget for a reduced return.

Mr. CHURCHILL

I had not got the special Schedule A this year.

Mr. LLOYD GEORGE

I do not want to labour a point which is immaterial, and for the moment therefore I will let it alone. If you begin to depreciate loans for the purpose of development, as the right hon. Gentleman is doing all round, you must expect difficulties. I could even quote the case of telephones. We are about the lowest in Europe for the number of telephones per thousand of the population. We are not comparable with the United States or with countries like Switzerland or Sweden and Norway, or Germany, Belgium and others. We are, I think, in the ratio of about 1 to 5 compared with America. America is raising this year about £80,000,000 for the purposes of development, but we are raising only about one eighth of that sum. It is the same policy all round. Later I shall deal with the question of roads. The Treasury are deprecating anything in the nature of capital expenditure or development, because they have in their mind favourable conditions in the market next year purely for the purpose of conversion. It is a fatal policy from the point of view of trade expansion in this country, and I hope that the Government will reconsider it.

The Chancellor spoke rather scornfully about trade with Russia. I have always been in favour of trading with Russia. We have nothing whatever to do with -Russian policy or Russian government. If anyone cares to come and buy here and a British trader likes to sell, I would give the most favourable consideration to the transaction. I gave the reasons why I thought it was a great mistake to hamper trade of that kind. When the right hon. Gentleman says that it means nothing, I would ask him to look at the six months trade for 1926. I cannot quote 1027 because the Arcos raid was in May, 1927, and I have not the figures for a full six months. The only complete six months period for which I have figures is the year 1926. The total trade with Russia, exports and re-exports, was £7,616,000. The total trade for the first six months of this year was £2,646,000. When the right hon. Gentleman says that £5,000,000 is a trifle which we need not take into account, he is taking a very erroneous and erratic view of what our responsibilities are in that respect.

I have always thought that the trade depression would be prolonged. In spite of what the Chancellor of the Exchequer said outside, he knows very well that I took that view during the time of the Government of which I was the head. I was at that time contemplating a good many measures for dealing with it. I have always- thought that when the ice cracked it would be a very serious business. I agree with the last speaker that that was not the view of the bankers and of a great many of the leaders of industry. They took a very hopeful view. They thought we would recover quickly. I did not see any reason for the conclusion to which they came. But there it is. There are pessimists and optimists and realists. There is the pessimist who is always scanning the horizon for clouds and when he discovers one he fixes his gaze upon it. There is the optimist who is always searching for the blue patches and keeps his eye on them. There is the realist who looks at the sky to see exactly what is happening. But there is a fourth person who, even when it is raining and when everyone is drenched, still says that the weather is good. That man is neither an optimist, nor a pessimist, nor a realist; he is simply a fool. What you really want is to find out exactly what the position is.

I am not going to say that there are not blue patches in the sky. There are new industries which are developing. Even in Lancashire there are new industries which are full of hope, and there are new industries in the South of England. But for the moment there is no doubt that the prospect is rather gloomy. There are some very disquieting facts, and the most disquieting of all is the fact that the import of raw materials this year has diminished very substantially. That means that traders do not see the prospect of the same orders coming in as they had last year. There is a second fact in the very serious decrease from week to week in the traffic on our railways, not merely passengers but goods, merchandise and coal. That is a very serious matter. Then there is the diminution in the provincial returns of our banks. Although this has gone on for eight years nothing was done to deal with it until the Minister of Health brought in his scheme about rating; nothing has been done during the whole of those years except what was either initiated or carried in the first year of unemployment. There is the Unemployment Insurance. I am not going to dispute the paternity of that in 1909, but I am referring to the much greater scheme of Unemployment Insurance which has covered practically the whole field of unemployment and which makes allowances that are something like adequate to save families from privation. That was in 1920.

The Road Fund on a scale which would be adequate for the purpose of dealing with unemployment Was carried in the first year of unemployment. Trade facilities, export credits, land settlement, drainage, afforestation, Lord St. Davids Committee—all these were done inthefirst year of unemployment, and not one single fresh idea has been evolved since then. In fact, the. Government have gone back upon these schemes. In the case of the roads, they have taken £30,000,000 away from the Road Fund, and they propose a further annual deduction from the amount which would have been available for the purpose of providing absolutely essential work. In the case of drainage the allowance for that has gone down, and in regard to relief work, as my right hon. Friend the late Chancellor of the Exchequer pointed out, the grant has gone down. The trade facilities scheme was practically abandoned for some time. Now I understand there is to be a further grant for export credits. Then there is Russia.

What is it the right hon. Gentleman wishes to do? It is quite impossible to discuss his proposals with regard to Lord St. Davids Committee and the drainage until we get the figures. It all depends on the amount. If the amount is trivial, it is idle to talk about it as a remedy for unemployment. If it is only something to provide employment for 3,000 or 4,000 out of 1,200,000 men, it is no remedy. On the other hand, the right hon. Gentleman may be contemplating something on a very serious and substantial scale. If he is, why does he not say so? We ought to know because a good deal depends upon whether the amount which he proposes to set aside for this purpose is adequate, or has any relation to the greatness of the problem. But when he talks about Safeguarding, I am rather amused, because the last time I heard him talk about it he used language fit for a poster—hut not on his own side. In very remarkable language he deprecated the whole of that policy, and I agree with my hon. Friend the late Chancellor of the Exchequer in saying that I hope in this one thing the right hon. Gentleman really will stand by what he has said.

Mr. CHURCHILL

What was the quotation?

3.0 p.m.

Mr. LLOYD GEORGE

I have not got it here, but I am sure the speech is well within the recollection of hon. Members because it created a great deal of unpleasantness among his own friends and was very considerably discussed. Everybody knows the particular speech to which I am referring, because it was as disappointing to hon. Members opposite as it was encouraging and cheering to us. Everybody knows that it was a very fine declaration upon the principles of Free Trade. But there is one respect in which I must disagree with my right hon. Friend the late Chancellor of the Exchequer. He said the right lion. Gentleman the Chancellor appeared yesterday in a white sheet. He does not know the right hon. Gentleman as well as I do. Whether the right hon. Gentleman is fighting for the Crescent or for the Cross, he never appears in a white sheet. He always appears in full panoply. He will do that, I have no doubt, when he fights against the principles of Free Trad.3 which he so boldly advocated only a few weeks ago standing at that Table. I think the best answer to his ease about Safeguarding as a means of dealing with unemployment, is the very fact that he based it on the assumption or rather not on the assumption, but on the reality—that all these Protectionist countries in Europe were paying much lower wages than we are paying here. In fact the whole case he made out for Safeguarding is the best answer to it. I hope that is not going to be his last word upon this subject. I am rather doubtful whether it really is. I can hardly see the right hon. Gentleman, with the views which he honestly holds on this subject, handing over to a tribunal appointed by the President of the Board of Trade, a tribunal, probably of Protectionists, the whole question of whether a basic industry like iron and steel is going to have a high tariff Imposed upon it. [HON. MEMBERS: "Or agriculture,"] No, agriculture is ruled out. Every- thing depends on the tribunal and after all, a Protectionist Government will appoint a tribunal in which they have confidence. I can hardly see the right hon. Gentleman from what I know of him trusting a body of that kind with a question which he knows is a vital question of principle and one which affects the whole fiscal system of the country and which would bring about a complete transformation in the whole of our business and industry in this country for better or worse.

When it comes to de-rating, I have already expressed my opinion upon the matter, and this is not the opportunity for discussing the de-rating proposals. We shall probably have another opportunity when the Measure comes before the House of Commons. All I would say about it is this. The reception which these proposals have received from the local authorities, bears out all the criticisms which were passed on this side of the House. The Minister of Health has tried to extricate the Government in the best way he could out of the defile into which the Chancellor of the Exchequer marched so very dashingly, when he made these proposals without consulting any of these gentlemen beforehand. May I point out that, at any rate, apart from the small proportion which is going to be allocated for the purpose of reducing transport, the major part of his proposals will not come into operation for a whole year. We shall have a whole year of unemployment when nothing is to be done with 1,370,000 unemployed and the figure mounting up by 30,000 a week. What is happening meanwhile? If you make inquiries, you will find that the very fact that the right hon. Gentleman is making these proposals is temporarily aggravating unemployment in the iron and steel and other industries.

What I am told is that purchasers are withholding their orders until this Measure comes into operation in the hope that when there is a reduction of overhead charges, they may be able to get their iron and steel cheaper. That is really, for the moment, aggravating the difficulty. In fact, the more you say for the Chancellor's proposals, the worse they are for the interval between now and 1st October next year. People have to live during the whole of these 12 months and a twelvemonth of that kind is very serious when you are dealing with a great competitive trade like ours that is facing some of the keenest competitors and rivals in the world.

I am bound to refer to some of these questions which the Chancellor of the Exchequer has mentioned, and the only other thing I will say about the rating proposals is this: the Chancellor of the Exchequer talks of them as if he had provided the finance. He has not. He has already incurred an annual charge of £35,000,000 a year. I read in the Press that the Minister of Health has indicated that it will be quite impossible to get the scheme through without dealing a little more generously with the local authorities. I ventured to say so when the scheme first came out, and I was promptly sat upon by the Minister of Health, much to my discomfort. He said that £3,000,000 would be required, but it will certainly be nearer £10,000,000, in addition to the three-fourths to be taken off. That means that the Chancellor of the Exchequer, or some Chancellor of the Exchequer, when the scheme is in full operation will have to find £40,000,000, and as against that he has only got one tax, which will bring in about £15,000,000 a year. Where is the rest to come from? That is not a very promising outlook for the trade of this country. Somebody has got to find it.

Now I come to a part of what I have to say which is certainly much more pleasing to me to dwell upon, and I hope I shall have the indulgence of the House in saying it. The Chancellor of the Exchequer and others, notably my right hon. Friend the Member for Hill-head (Sir R. Horne), said, "What have you got?" I think the Government are entitled to ask that, although we have not the means at our disposal which they have for ascertaining the facts and for preparing a scheme. My view is this: These are extraordinary times and conditions, and you must have extraordinary measures to deal with them. It is not enough to have trivial, small, and even petty schemes, not even schemes on the scale of the scheme of the Transference Board, which moves 300 or 400 a week, or whatever it is, and which only hopes to be able to deal with 5 per cent. of the unemployment in the mining industry. You must have something on a bigger, bolder, and more compre- hensive scale. Whatever course you suggest, there will be objections to it, irresistible objections in logic, but there is a time in an emergency when a Government has got to say, "This thing must he done," and when a Government takes that line, I venture to say it can be done. European Powers who were face to face with the great problem of debased currency had to do it. Every suggestion that was made to remedy the situation was open to the gravest objections, and financiers would criticise any proposal that was made. At last, in France, Germany, and Belgium, you had men who said, "This thing has got to be done, and this is the way to do it."

The Government have got to take the same line, if I may say so. They have got to say, "This is a condition of things that no Government has been confronted with for over 100 years; it is abnormal; it is exceptional; it is extraordinary; it is an emergency, and we must take emergency measures for dealing with it." I think the Government ought to say that, and I am going to tell them later on how I would carry it out. I think the Government must say, "Within a year we mean to reduce the number of unemployed by one-half." Now I will say what I mean, because a bold statement of that kind without explanation would be open merely to derision and contempt. I will state exactly what I mean.

The first thing I would say is this: Unemployment ought not to be treated merely as a misfortune to be regretted, but as an opportunity to be taken advantage of. There are 1,300,000 people out of work. That is a misfortune. It is also an opportunity. Every big concern run at high pressure demands occasional overhauling. The machinery needs repair and renovation. Some of it needs to be scrapped, and new machinery substituted. The organisation ought to be reconsidered, revitalised, re-energised. The structure very often needs extensions, alterations, improvements, and the best time to take these in hand in any business is during the slack time. When the demand is great, it is as much as you can do to produce the output by turning every machine on. You cannot stop any machine. You cannot find the labour. The time to overhaul and to put things right is during the slack time, and every rich concern has the necessary reserves of credit for the purpose of doing it even in times of depression. When prosperity returns, what happens That concern will then be equipped to meet the increased demands without danger of a breakdown.

The same thing applies to a great nation as to a great business. We have been working for over 50 years in this country at very high pressure; we have had the extra pressure during the War. There is no doubt at all that the social and economic machine needs overhauling thoroughly in many respects, and this is the time to do it, a time of slackness, a time when you lime labour at your disposal. When times of prosperity come—and I take the same view as the Chancellor of the Exchequer, that although we are moving very, very slowly, and almost at times even imperceptibly in that direction, the stream is flowing in the direction of prosperity. I do not agree with those who say that it is flowing in the other direction. I think on the whole, judging year by year, making allowance for the curves in the river, we find that it is flowing in the right direction, but very slightly. When prosperity comes, we shall be too busy, too pre-occupied, and the real danger then is that you get an inevitable breakdown in the middle of prosperity, and anybody who looks at some of the symptoms—political symptoms if you like—must realise that we are getting very much nearer the point of the breakdown.

What is it that I mean by the things that could be put right, that ought to be put right, and that this is the time for putting them right? I will give two or three illustrations, because they all go straight to the problem of finding work for the workless ! The housing problem in town and country—I shall say some thing more about that later on—the traffic problem, the transport problem, and the very urgent problem—I want to impress upon my countrymen how urgent it. is—of the decay of the countryside. It is a feature which, in my judgment, you do not find in any other country in the world. It is due really to our exceptional prosperity, to the enormous riches which we were able to accumulate through the special opportunities which we have had in this country of making money out of other industries. We neglected the countryside, and we have a problem in the countryside which they have not in any other country, not merely in agriculture but in the complete departure of rural industries.

Then there is the reorganisation of our industries, which is known by the word "rationalisation." It is quite a good word; it is as good as any other. Before you can deal with that, the Treasury must really revise their ideas about expenditure. They must adopt the business view of expenditure that all unproductive expenditure is wasteful, and that productive expenditure ought to he encouraged, within the means at the command of the concern, whether it be national or private, that it enriches a concern; it develops it, it strengthens it, it makes it mare powerful to meet the future, it adds to the profits of the concern. We have restored our credit at very great expense, and there is no country which has taxed itself like this country. I think that the Chancellor of the Exchequer has paid too high a price for restoring our credit, but having got it, having paid for it at enormous expense, why should we not use it? It is our greatest asset. It should not be there like the talent buried in the ground, merely to be dug up whenever we want a conversion scheme. Does the right hon. Gentleman remember the fate that befell the man who used his talent in that way? He was cast out, and the talent was taken from him. That parable is the greatest lesson in political economy ever taught.

Having got credit for this country, use it. There never was a moment when this country stood more in need of it. There never was a moment when you could make more fruitful and profitable use of it, and yet it is down there in the foundations of the Treasury, out of sight, to be used sometime or other when they want it for a conversion scheme. That is not business; it is not Christianity. Let us use our credit in improvements and developments that will make us a better equipped nation, a nation equipped for prosperity, which we are not now. I am not advocating the class of relief work which the right hon. Gentleman deprecated. To spend money on work when it answers no purpose, when it does not add anything to the asset value of this country, I condemn just as much as the right hon. Gentleman would do. To spend money on work which is not required is folly, is worthless; but not to spend money on work which is seriously needed by the nation, and which the nation will sooner or later have to do in order to be an efficient nation, work which is productive—not to spend money on that now, when by its means you can provide employment, is not merely a folly, it is a crime.

I will give one or two examples of work waiting, clamouring, to be done. I will begin with the reconstruction of our road system. That has been urged upon the Chancellor of the Exchequer and upon the Government not merely by local authorities but by business communities as well. It is just as necessary to have a new road system in this country as it was to have a railway system at the beginning of the 19th century. The rail way system dealt with a new power which had come into civilisation. The motor traffic problem is an identical one, and to take away money which had been allocated for roads is to behave in the reactionary spirit of the old landlords who at the beginning of the 19th century would not sell their land for the purpose of a railway—[An HON. MEMBER: "Our land!"]—well, would not sell land. What is the present position in regard to our roads? The position is dangerous, wasteful and extravagant, in both town and country. In the country the roads are not fitted to the purpose of enabling the rural population to take full advantage of them for marketing purposes. The bridges are not sufficient, apart from the roads. The roads are dangerous, and as for some of the bridges, you are not allowed to take motor lorries across them to fetch produce. I live in a district where there is a bridge which no motor lorries are allowed to cross. The right hon. Gentleman the Member for Colne Valley (Mr. Snowden) knows it very well. [Interruption.] We are both on the same side of that bridge. It is an old bridge, constructed, I believe, in the days of the Romans. It is very picturesque, and it is very good to preserve it from the point of view of what are called the amenities of the neighbourhood, but you are not allowed to carry anything heavy across it. There are hundreds of bridges of that kind and there have been reports upon them by the county councils.

When we come to the towns we find that the block in traffic imposes a very serious loss on business. The old adage, "Time is money" is very true in this respect. The Commercial Motor Users' Association compute that in London alone this failure to deal with the traffic problem costs the business community £20,000,000 a year. That is the problem. They are returning to the use of horses in London. It is just as if they were returning to hand looms in Lancashire. In the United States of America, where there has been prosperity and very little unemployment except during the War, at least since 1916, they have raised £400,000,000 as loans for the purpose of constructing new roads. A very large proportion of that sum of money has been spent in the rural areas. In this country, our housing schemes are practically coming to an end. The housing subsidy, if it has not been withdrawn altogether, has been reduced, with the result that there is undoubtedly less building. I am not now entering into the question of whether the Minister of Health can do anything more under the old schemes, but he has not yet touched the slum problem in the town—he has not even begun—and he knows perfectly well that the slum problem in the towns is not one of rebuilding but of taking the congested population out of the towns into the outer districts. It is no use rebuilding a slum. If a district continues to be overcrowded, it will still be a slum. At the present moment, you have a large number of people living three per room in Glasgow. There are 40,000 back-to-back houses in Birmingham, and 60,000 in Leeds. If you go across the border, you find dwellings where you have about six or seven per room.

Mr. THURTLE

Eight or nine.

Mr. LLOYD GEORGE

My hon. Friend the Member for Shoreditch (Mr. Thurtle) says that there are cases of houses where there are eight or nine persons per room. You cannot deal with that problem merely by rebuilding these slum tenements, and you must open up great avenues which will enable the population to live outside the towns where they will be able to get to and from their work within a reasonable time. That is the way Germany is dealing with the problem. Belgium has already dealt with the problem in that way in Antwerp and other places. Here is work awaiting the unemployed which would enrich and ennoble the country. How are you going to do it? You have a fund which would provide over £20,000,000 per annum for that purpose. If they can raise £400,000,000 in the United States of America on the basis of their Road Fund, surely we could raise £100,000,000 or £200,000,000 for constructing roads in this country. You could also get a very legitimate source of revenue by annexing the increased value of the land which would he created alongside the roads; that was the principle of the Act of 1909 which I regret has not been put into operation. Upon that basis you could raise considerable sums of money for the purpose of the development of roads, if the Treasury were to withdraw its ban, and not deprecate loans because they might interfere with their conversion schemes next year.

Then reference was made to the need for improvement in our docks and harbours. An hon. Friend of mine, who knows them very well, gave me a very glowing account of the additions which have been made to the Port of Antwerp, and the facilities which are being given there for competing with the great Port of London. All these things could be done if the Government would take action. I do not want to dwell upon the problem of agriculture, but we have the greatest market in the world at our own doors. Foodstuffs to the value of £350,000,000 are coming in, all of a kind which can be grown here. A considerable proportion of that could be grown here. You have a market such as does not exist in any other country in the world, not merely from the point of view of density of population, but of propinquity to the fields of cultivation, if you only had the necessary organisation, if you only had the marketing arrangements, the roads and the transport.

The right hon. Gentleman seems to think it is merely a question of reducing the charges of the railways. It i6 not, I can assure him. It is not a question of charges, but of facilities, and facilities involve a very considerable expenditure on roads and a marketing organisation for the producer. I see in the "Times" this week a very remarkable letter from Lord Bledisloe, than whom there is no greater authority on the subject in this country. He is only repeating a suggestion which has been made by two or three county councils, including, I think, Hampshire and Oxfordshire, and there was also a letter from a relative of the right hon. Gentleman's, the Duke of Marlborough, on more or less the same lines. What is the suggestion? They all point out the condition of agriculture, and they make an appeal that this should be treated, if possible, as a non-party question, and that there should be a real national effort to revive agriculture. The present Prime Minister summoned a conference in 1924, and made an appeal, which I thought was on the wrong lines, to farmers, landlords, and trade union representatives of the labourers. It will never be settled on those lines—never. The result was that that conference broke down, and I am very sorry that the Government were so easily discouraged. I ask again, if it is impossible to settle it as a party question, why not try and settle it as a national question?

In Germany, the revival of agriculture was taken up as a national problem by all sections, all parties, all classes; and the same thing should be done here. If you revive the countryside, you will solve more than half your unemployment, problem. At the present moment, as anybody who lives in the country well knows, the countryside seems to be completely denuded of young people. When they reach the age of 15 or 16, they do not look for a job in their own village, but go off to the towns, and you cannot find workpeople for essential agricultural work in the country districts. The hedgers and ditchers are all gone, and it is very difficult to find apprentices there. As anyone who knows the country districts knows, the revival of the countryside would do more than almost anything else to solve the unemployment problem, and it would be a permanent contribution to the enrichment of the country. In addition to that, the right hon. Gentleman might bring a little more pressure to bear upon the Electricity Commissioners, or whoever has the power, to drive ahead a little more rapidly. A sum of £2,000,000 or £2,500,000 for a Measure which was passed in 1925 to deal with an urgent problem is not enough when you have unemployment in the country. If you had no unemployment, this old cautious method of procedure might be all right, but this is a time at which to drive it on and bring electricity into the rural areas, and by that means revive the rural industries which would help to keep the population on the soil.

These are some of the suggestions which I make to the right hon. Gentleman. They would all involve employment for hundreds of thousands of people in the course of the next few years. The right hon. Gentleman will say what is to happen afterwards. This is really a time problem. There is a process of rationalisation and of improvement going on in industry. The effect of it for the time being, undoubtedly, is to reduce employment, and it is bound to do so, but gradually it will increase employment. But you have to fill the gap. Let us fill the gap with something that will permanently enrich and improve the country. The Prime Minister and I recently visited a very depressed area. He was there on Wednesday, and I was there on Thursday. That was the South Wales valleys. We both witnessed the same dreary, depressing spectacle. There is only one road along which he could travel, and I travelled the same road. There were thousands of young men hanging about the street corners doing nothing, looking miserable, dejected and hopeless. There was no work for them, and it is work they want —they were decent young fellows—in that valley where every year scores of thousands of tons of pitprops are brought across the Bay of Biscay and from Norway for their mines. The valleys themselves at one time were clad with forests.

Why on earth should not the Government now, instead of seeking to transfer 300 or 400 a week And make town porters or whatever it is out of them here and there —I am not in the least criticising that—begin to reafforest these perfectly waste lands? More than that, the roads were narrow and dangerous. I traversed the whole of these valleys right through Monmouthshire on the same day. I have never seen worse roads for a thickly populated country. There are great tasks waiting in the way of opening up new roads, and you have 50,000 men out of work. I will tell the right hon. Gentleman more about that district. Most of the food comes from outside, and is got across the mountains. There are some rich fertile valleys in this country. From the point of view of food they are further removed from the population of these valleys than if they were in Jutland or the Argentine. Food comes from hundreds of miles across the seas. There is practically no communication. You ought to open up those 'agricultural districts for the purpose of bringing food down to these eager markets and providing work for men who only a few years ago were taken from the land. You talk about national reconstruction, but—I am sorry to say it—you will never reconstruct until you reconstruct that Ministry. I hate making any personal attacks or personal references, but I ask hon. Members there in all solemnity to think of the Ministers who are in charge of the particular Departments who have to deal with all these problems, and I ask them, as business men, suppose each of these Departments was dealing not with national concerns, but with a private business, if agriculture, or the provision of food, or the provision of roads, were a private trust—I could go through a whole list of them—does anyone imagine this is the class of man to put at the head of them I want to make an appeal to the Prime Minister. I am bound to say it. I should not be doing my duty in this House nor to my constituents unless I said it. It is what has been said by hon. Gentlemen, by the critics of the Government on their own side, and it is true. You cannot deal with this gigantic problem of unemployment until you have men who are capable of handling big problems of that kind. Once you do it and face it boldly you will be able to go a long way towards solving what is the darkest and most menacing problem of our day.

Mr. BOOTHBY

It would ill become a young Member of this House and a private Member to attack the speech which has just been delivered by the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George). It was, if I may say so, a very constructive speech except perhaps in its closing passage.

Mr. LLOYD GEORGE

That was the most constructive of all.

Mr. BOOTHBY

The right hon. Gentleman did go down to the fundamentals of the problem which is confronting this Hous3 this afternoon, which certainly the right hon. Gentleman the Member for Colne Valley (Mr. Snowden) never attempted to do. As far as I can remember, the main proposal of the speech of the right hon. Gentleman was this; that the Government, having with considerable difficulty restored the national credit, should use that credit not primarily in order to reduce the conversion rate of interest but in order to develop schemes of national importance. I think that I have represented, his point of view fairly. As far as I am concerned, as an humble student of economics, I am perfectly prepared to adopt a neutral attitude as between the right hon. Gentleman and the right hon. Gentleman the Member for West Swansea (Mr. Runciman), who puts with tremendous force and lucidity and vigour a diametrically opposite point of view. I have heard the right hon. Gentleman the Member for West Swansea say, and say on more than one occasion, that the only hope for trade and industry in this country was cheap money' and a low rate of interest; that the husbanding of the reserves and the resources of the Government should be the chief objective of any Government. He has again and again attacked my right hon. Friend the Chancellor of the Exchequer for squandering the resources of the country and not husbanding them.

Mr. LLOYD GEORGE

In the absence of my right hon. Friend I am bound to say that I do not think that the hon. Gentleman is doing him justice. He did not protest in the least against the raising of money for purposes of development. His protest was against extravagant expenditure for unproductive purposes, a very different thing.

Mr. BOOTHBY

I also heard the right hon. Gentleman say quite clearly that by far the greatest thing would be to conserve our resources, because the reduction of the rate of interest on loan to be converted was of primary importance to this country at the present time. It seems to me that to carry out the suggestions of the right hon. Gentleman the Government must either directly spend money or else borrow it. If the Government borrows the money, to that extent inflation must be induced. I am not going into arguments against inflation, although I hope to deal with the arguments which the right hon. Gentleman used against our return to the gold standard. The right hon. Gentleman said something about the attitude of the Chancellor of the Exchequer in regard to the safeguarding of industry. Surely, the Chancellor of the Exchequer made his attitude perfectly clear yesterday upon that question. He stands by the Prime Minister's letter of the 3rd August. That is the letter which the whole party stands by, and that is the policy upon which we propose to go to the country. I have here a quotation from the speech of the Chancellor of the Exchequer to which the right hon. Gentleman referred. I find that he said: So far as the fiscal system is concerned, we are perfectly free, and we ought to he, to study and develop exceptional measures for the special culture of particular trades, where advantage can be gained, and where we have shown that advantage can be gained. It seems to me that there is the policy of the Government. The Chancellor of the Exchequer went on to say: We should also carry protective aid, perhaps by temporary measures, in cases where the strain is shown to be greatest and where it can also be proved that we can give this aid without bringing greater evil in its train."—[OFFICIAL REPORT, 24th July, 1925: col. 1228, Vol. 220.]

Mr. LLOYD GEORGE

Which speech is that?

Mr. BOOTHBY

It is the speech to which the right hon. Gentleman referred.

Mr. LLOYD GEORGE

Why does not the hon. Member read the whole of it?

Mr. BOOTHBY

I am very anxious to make a speech of my own. There was one remark made by the right hon. Member for Colne Valley with which I fully agree. He said that small remedies applied to large problems produced not only small results but no results. That is perfectly true. This question is so huge that no single Government can be held to be responsible for unemployment, whether in this country or in any other country. I hope that if ever I sit on the Opposition benches, I shall never accuse any Government of being directly responsible for the volume of unemployment in this country, because I do not believe that they can be held responsible. To blame the Government for unemployment is, to use two favourite expressions of the right hon. Member for Colne Valley, both pettifogging and ridiculous.

Mr. MAXTON

Whom do you blame for it?

Mr. BOOTHBY

I blame world conditions. The only immediate and direct connection where a Government is concerned with unemployment is when industry is going through bad times and it casts off a certain amount of what one may call the sick men, and they fall to be looked after by the Government of the day. That is the only immediate and direct connection that a Government has with unemployment. In regard to the main problem, it seems to me that there are two sides, the social side, which is comparatively superficial, and with which the right hon. Member for Colne Valley exclusively dealt, and the economic side, which seems to me to be the fundamental side, and with which the right hon. Member for Carnarvon Boroughs dealt exclusively. With regard to the social side, it does not seem to me to be in the least necessary to add anything to what was said by the Parliamentary Secretary to the Board of Trade (Mr. H. Williams) in the admirable speech with which he wound up the Debate last night, and the speech which was made to-day by the Minister of Labour. The social side of the problem involves the handling of over a million unemployed. Personally, I do not see any reason to suppose that we shall have less than one million unemployed in this country, whatever Government is in power, for several years to come. In any case, this is, in comparison with the fundamental economic problem, a more or less superficial problem.

The other part of the social side of the problem is the distressed areas. I have not heard in this Debate sufficient mention made of the proposals of the Minister of Health to deal with this question. He is dealing with it in a very drastic, a very courageous and, I think, a very effective fashion. The value of widening the areas of Poor Law administration can hardly be overestimated. I do not remember having heard a single hon. Member mention that, although it seems to me to be about the best proposal that has been made for dealing with the problem of the distressed areas. The value of the block grant also seems to me to be—

Mr. MacLAREN

How can they solve unemployment?

Mr. BOOTHBY

I am dealing with the problem of the necessitous areas to which the problem of unemployment has given rise. I think it is germane to the subject. The immediate and actual problems the Government has to deal with are the necessitous areas and the unemployed. With regard to the necessitous areas, it seems to me that the proposal to base the block grant on the formula which has been announced will be of tremendous value, For the first time in the history of this question a local district will get money from the Government in accordance with its requirements instead of in accordance with the amount of money it is able to spend. That is an invaluable proposal, and I think will do more to ease the distress of the necessitous areas than anything else.

I now come to the economic side of the problem. The only thing which will really affect the volume of unemployment is a return of trade prosperity. With perhaps a single exception, land drainage, I do not think direct schemes promoted by the Government are likely to affect the problem very much. In the first place, there is always an enormous expenditure in every case for extraordinary small results. Whenever you get a proposal submitted for a direct scheme involving Government expenditure, it is amazing to see the amount of money that has to be spent in order to provide a very small number of new men with employment. The hon. Member for Smethwick (Sir 0. Mosley) yesterday pointed out that from 1919 to 1925 the State had spent £47,000,000 on housing, absorbing only 143,000 new workers. That is a typical example of what happens when the Government spends money directly in order to absorb the unemployed. The expenditure is out of all proportion to the number of unemployed who are absorbed. The right hon. Member for Carnarvon Boroughs spoke as though it was possible to take miners in immense numbers and put them on to housing construction. You cannot. We have not the money, and, in the second place, housing is a highly technical trade; a bricklayer's trade is a highly skilled job.

On the economic side there are four great questions, three of which were dealt with by the right hon. Member for Carnarvon Boroughs. First, there is rates and transport, which directly add to the cost of production; secondly, there is the problem of the price level; then markets; and, in the fourth place, the problem of industrial reorganisation. With regard to rates and transport, that is the only question with which the Government can deal directly and immediately, and it is a question upon which the Government have made drastic proposals. The principle underlying the rating scheme is that the tools and plant of production ought not to be taxed as such, but only the profits arising from their use. That principle, I think, is unassailable. I have never heard it seriously attacked or disputed. I do not think the magnitude of the Government's scheme in regard to the rating problem has been sufficiently appreciated. To take three-quarters of the rates off the whole of production is a step of tremendous importance, and the cumulative effect of it, which will amount to about 4s. per ton on the export price of steel and an average of 71d. per ton on the export price of coal, will give more impetus to the basic industries of this country than anything else. On the top of that you have also a reduction in the freight charges.

In the few moments left me this afternoon I want to deal with the question of the return to the gold standard. The right hon. Member for Carnarvon Boroughs accused the Chancellor of the Exchequer of being largely responsible for the present industrial, depression because of his decision to return to the gold standard. Really the decision to return to the gold standard was taken on a Treasury Minute in the autumn of 1919, following upon the recommendation of a gentleman in whom the right hon. Member for Carnarvon Boroughs always put the greatest confidence, the late Lord Cunliffe. It was his Commission that recommended a return to the gold standard. Every subsequent Government supported the policy, including the Government in which the right hon. Member for Colne Valley acted as Chancellor of the Exchequer. When my right hon. Friend the present Chancellor of the Exchequer took office we were within a point or so of having achieved the gold standard, and all the efforts of six years would have been rendered quite nugatory if at that moment he had declined to go back to the gold standard. Certainly, if there is any blame to be attached to the policy, it cannot be Attached to the present Chancellor of the Exchequer, but we must go back to the early days in 1919.

Mr. MAXTON

The present Chancellor of the Exchequer was in that Government too.

Mr. BOOTHBY

But he was not Chancellor of the Exchequer. No one seriously contends now that the policy of an ultimate return to the gold standard was a bad policy for the country. I think the right hon. Member for Carnarvon Boroughs is really confusing the House a little on this problem. The problem is not merely one of low prices or the enhanced value of sterling. The problem is to get steady prices. It is not low prices but falling prices that is the cause of the trouble. What we ought to aim at is a stable measuring rod of value and not a rod of jelly. Short fluctuations in prices have been immensely reduced in the last two years—from 3 per cent. to 1 per cent. of the year's mean level, and long period fluctuations have been reduced still more. The only way in which you will ever get permanent stability in world price levels is by international action, probably upon the lines laid down by the conference over which the right hon. Member for Carnarvon Boroughs himself presided at Genoa. That is the policy of the Government now. It is not a problem with which any Government singly can deal; it is a problem for all the main Governments of the world to deal with, acting together. I would quote from a member of the Industrial Inquiry of the right hon. Gentleman's own party—Sir Josiah Stamp, a Director of the Bank of England and perhaps the greatest economist in this country. Writing only last week in the "Spectator" he used these words: That the true underlying cause of many of our social troubles should be laid bare is essential in the interests of clear dealing with public issues, and public opinion should be moulded by the truth. That, having done it, we may still be without a remedy or an effective remedy, is beside the mark. We shall at least have learned not to blame the wrong causes and not to base our hopes on remedies that must be illusory. Now the main economic problem confronting the world to-day is, according to Sir J. Stamp, this problem of the world price level. And it is not a problem that can be solved by any Government acting singly.

Mr. LLOYD GEORGE

He said the return to the gold standard was premature.

Mr. CHURCHILL

That was more than you did, anyhow.

It being Four of the Clock, the Debate stood adjourned.

Debate to be resumed upon Monday next.

Whereupon Mr. SPEAKER adjourned the House, without Question put, pursuant to Standing Order No. 3, until Monday next, pursuant to the Resolution of the House of this day.

Adjourned at One minute after Four o'Clock until Monday next, 12th November.