HC Deb 30 November 1928 vol 223 cc804-8

Considered in Committee under Standing Order No. 71A.

[Mr. JAMES HOPE in the Chair.]

Motion made, and Question proposed, That, for the purpose of any Act of the present Session to secure in Scotland by means of the formation of a company and the assistance thereof out of public funds the making of loans for agricultural purposes on favourable terms, and to facilitate the borrowing of money in Scotland on the security of agricultural assets, and for purposes connected therewith, it is expedient—

  1. (a) to authorise the payment out of the Consolidated Fund, or the growing produce thereof, of such sums not exceeding one hundred and thirty-five thousand pounds as may be required for making advances to the company to be formed under the said Act and for procuring the underwriting of debentures or debenture stock to be issued by such company as aforesaid for raising sums not exceeding eight hundred thousand pounds;
  2. (b) to authorise the payment out of moneys provided by Parliament of sums not exceeding one thousand seven hundred and fifty pounds a year for ten years as contributions towards the cost of administration of the said company;
  3. (c) to authorise the payment into the Exchequer of sums paid by the said company by way of repayment of or interest on such advances as aforesaid."—(King's Recommendation Signified.)—[The Lord Advocate.]


I do not want to press the Lord Advocate unduly on this question, but under the circumstances we must ask him his intentions under the Financial Resolution. It is clear that this plan can only go ahead in Scotland in terms of a corporation subsisting on the lines of the English Corporation which has been formed. In that case, and before we pass the Financial Resolution, the House deserves to know the exact position of any negotiations with the hanks and whether, in fact, there is any prospect of a company of this kind being established in Scotland substantially in terms of the English Corporation.


I will gladly give what information I can, but the right hon. Member for Central Edinburgh (Mr. W. Graham) will understand that negotiations are still going on and it is a little difficult and delicate to say anything about them. I have said already, and I will say again, that if the banks fail to come in there is every prospect of an alternative form, but we do not anticipate any difficulty in the formation of this company. Naturally, we should prefer to follow the English scheme and we are at present negotiating with the banks. I hope the right hon. Gentleman will not press me to say anything further. We have been criticised for not bringing this Bill in sooner and at the same time as the English Bill. It is obvious that time is going to be short this Session and we took advantage of this opportunity to get the Second Reading and also the Financial Resolution which will enable us to get straight on to Committee, which is the important stage. That is the reason for introducing the Bill now, and I have undertaken that the House shall be in possession of certain definite information with regard to the formation of the company before the Committee stage. I have said that before and I repeat it now, and I suggest that there is sufficient justification for proceeding with the Bill.


I understand the undertaking of the Lord Advocate to be this —as far as I am concerned I shall be satisfied—(1) that before the Committee stage is taken the Secretary of State for Scotland will be able to tell us whether he has made definite arrangements with the Scottish banks, and (2), failing that arrangement, whether he intends to go ahead with a separate company inde- pendent of the banks which will, of course, be a manifest departure from the practice adopted in England.


That is exactly the undertaking I have given.


I have no desire to do or say anything which will deny to the agricultural interests of Scotland the privileges which are given on this side of the Border, but it seems to me that the Lord Advocate should give the Committee a reasonable assurance that this scheme will bear fruit. Clearly, no purpose is served by passing this Measure and going into Committee unless we have an assurance that the negotiations which are proceeding are likely to give satisfactory results. It is all very well for the Lord Advocate to say that he will furnish evidence when the Committee meets. What is the purpose of asking the Committee to agree to a Financial Resolution which involves the expenditure of public money for a purpose which at the moment is in the air'? The Lord Advocate cannot be allowed to ride off in this extremely perfunctory fashion; throwing this Financial Resolution at our heads and saying, "Take it or leave it."

We are entitled to some evidence in support of the proposal that this expenditure is essential, and I am amazed that the Lord Advocate should ask us to accept a proposition like this without submitting any evidence in support of it. I am afraid that this scheme will come to nothing. The farming interests are not very anxious about it; there is no likelihood of a company being promoted and the banks themselves are not very keen. The Lord Advocate has said that if the banks do not come in some other company will be formed. I am not quite clear about that. If the present negotiations—assuming that there are negotiations, which is a large assumption—fall through, the alternative proposals might then disturb the Clauses in this Bill. We are entitled, I think, to some further explanation. We do not desire to divide the Committee on the matter but the Lord Advocate must not assume that our desire for conciliation entitles him to refuse a reasonable explanation, which in the circumstances should be forthcoming, that there is a likelihood of the scheme coming to fruition and that our discussions and further deliberations will be justified.


I will answer the hon. Member in a sentence. It is our anxiety to make sure, as it is the anxiety of all hon. Members, that this Bill shall get through this Session, and we are therefore very anxious to take advantage of this opportunity to get it through the first stage on the Floor of the House. That is the reason why we are introducing the Bill at this moment; there will be plenty of time and opportunity to discuss it later. I prefer to wait until the negotiations are put forward in a definite scheme. I have given the Committee quite frankly the reasons why we have brought forward the Bill for Second Reading to-day and also for moving the Financial Resolution. One of the worst services I could render this scheme, even if I felt I was entitled to do so, would be to disclose the present stage of the negotiations, or say what the prospects are. Surely the hon. Member will accept my assurance that they are going on. I am sure the Committee will accept that assurance. I have been asked whether I can give an assurance that there is a reasonable prospect of the scheme going through and the company being formed. I think I have used an even stronger phrase as to the prospects of the scheme going through in some form or other, but at this stage of the negotiations I am unable to say definitely whether it will be through the banks.


May I press the point still further. The banks are the only people mentioned in the Bill.


The Bill covers any form of company.


Yes, I know, but we expect the banks to form this company. Failing the banks, what is there in the Bill which enables any alternative company to be promoted? Will the 'insurance companies be free to form this company? Will an ordinary company he recognised under the Bill?


I must point out that we are not discussing the Bill but the Financial Resolution.


Under the provisions of the Bill, what other method is there for carrying out the terms of the Financial Resolution?


Really this is very unsatisfactory, and the Lord Advocate himself apparently recognises that fact. I can imagine what would have been said in 1924 if my right hon. Friend the Member for Central Edinburgh (Mr. W. Graham) had come and asked the House to pass a Money Resolution which was to give public funds to some private corporation formed either by the banks or by other persons with whom no definite agreement had been made and no contract signed, and about whom no information was available. What an amazing position it is! Upon that we are asked to pass a Resolution governing the whole business. It seems to me to be a policy of Bedlam as far as Parliamentary procedure is concerned. The Lord Advocate cannot possibly justify it. What is the defence? It is that, after all, the Government want to secure the passage of a Bill for which there may be limited Parliamentary time. That is all. Yet the Government admit that they introduced a Bill in almost entirely the same form, with the exception of the extension of title, last Session. They have had the Bill before them for consideration since then. Now, in December of the same year, they come and ask for a Money Resolution and have no terms of contract and no arrangement made with the banking interest concerned. If the arrangement with the banks fails, is it not reasonable for Members to ask who are the other interests with whom the Scottish Office are confident. that they can make an arrangement? When we were dealing with the English Act we were told quite plainly who they were. The Bank of England took a certain proportion of the shareholding of the corporation to be subsidised by public funds, and the rest of the shareholding was taken by four banks. The Lord Advocate really is asking the Committee to give him a blank cheque. We have already said that we do not. want to offer opposition to the principle of the Bill, but really the Lord Advocate is not treating the Committee with the respect that it deserves by leaving it in this position.

Question put., and agreed to.

Resolution to be reported upon Monday next.