THIRD SCHEDULE.—(Enactments Re- pealed.)

HC Deb 16 December 1929 vol 233 cc1083-145

Captain CROOKSHANK

I beg to move, in page 16, line 19, column 3, at the end, to insert the words: and Sub-section (5) of Section thirty-five. This is a very small Amendment. Subsection (5) of Section 35 of the Act of 1920 merely states that one of the provisions of the Rules Publication Act, 1893, does not apply to any regulations made under that Act, and I think that, in view of the attacks which have been made on the subject of legislation by regulation, we should re-insert into any Measure that we can the old provision that, in the case of any Statutory Rule, notice should be given when it is proposed to make any change. As a matter of fact, that is a recommendation which the Lord Chief Justice himself has made in his authoritative work on this subject, and I commend it to the right hon. Lady and ask her if she will be good enough to accept the Amendment.

Miss BONDFIELD

I regret that cannot accept the Amendment.

Captain CROOKSHANK

Are we to have no reason given?

Earl WINTERTON

I really think we might have some reason for the refusal to accept this Amendment. If the right hon. Lady cannot give a reason, perhaps the Parliamentary Secretary can. It is really treating my hon. and gallant Friend with rather scant courtesy merely to say that the Amendment cannot be accepted, without giving any reason. Perhaps, when they have searched for the reason, one of the hon. or right hon. Gentlemen opposite will give an answer to my hon. and gallant Friend. [Interruption.] It is not a question of courtesy. The lack of courtesy is on the part of the Government. My hon. and gallant Friend made a perfectly reasonable request, but all that the right hon. Lady said was that she regretted that she could not accept the Amendment—[Interruption.] I would remind hon. Gentlemen that it is usual for even the most incompetent Minister to give some reason for not accepting an Amendment.

Commander WILLIAMS

If we are not going to have a reply on this Amendment, I can only say that it is most unusual. I do not think I have ever before heard a Minister refuse to give a reply on an Amendment that has been called on the Report stage. We all have very great sympathy with the right hon. Lady in her difficulties with this Bill, but, after all, if people accept office, it is expected that they should understand what it involves. When the Minister simply says, blankly, "No. I cannot do this," do not wish to be unjust, but it looks as if she did not know anything about the matter. I should not like that to go out to the country; I think it would be a terrible thing; it looks as if the right hon. Lady had as little knowledge as the Liberal party at the moment. It looks as if she were like the Leader, or the owner, I should say, of the Liberal party—as though she were of a, proud disposition and would not let us know what it is about. There is nothing really to hide. I am only endeavouring to help the right hon. Lady in her very difficult position. I see the Parliamentary Secretary getting some information, and, directly he comes back and says that that information is available, I will give way. This is not a minor point. It is a point which the Lord Chief Justice emphasised very clearly, and I hope that at any rate the right hon. Lady will let us have some reply.

Sir ARTHUR STEEL-MAITLAND

As soon as the Parliamentary Secretary comes back, I would really ask whether we cannot have a reply about this. The point is quite simple. The Sub-section says: Section 1 of the Rules Publication Act, 1893 (which requires notices to be given of a proposal to make Statutory Rules) shall not apply to any Regulations made under this Act. It is scant courtesy to the Opposition. We have not obstructed any business. The Amendment has this very substantial reason for it, that by this Bill the Department are taking important powers for Regulations which ought not to be allowed to pass sub silentio. There is a real, valid reason now for saying that there ought to be notice of proposals to make Statutory Rules after all that has happened.

Miss BONDFIELD

There was no intention of discourtesy to the House. I knew that hon. Members were very anxious to get on with their Amendment. It is clear, as the right hon. Gentleman must know, that a Department like mine has to make Regulations and cannot wait 40 days to lay them on the Table of the House before anything can be done. It would be a perfectly unreasonable and hampering request to the administration to accept the Amendment. It was not with any lack of courtesy, but I thought it would have been perfectly obvious, certainly to the Front Bench, that such an Amendment could not be accepted.

Amendment negatived.

Amendment made: In page 17, line 10, leave out the words paragraph beginning 'In the case of,' and to insert instead thereof the words: words from In the case of any person formerly,' to the end of Sub-section (2)."—[Miss Bondfield.]

Motion made, and Question proposed, "That the Bill be now read the Third time."—[Mr. Lawson.]

Sir A. STEEL-MAITLAND

I beg to move to leave out from the word "That" to the end of the Question, and to add instead thereof the words: this House declines to assent to a Measure which places increased and multi plied burdens on the Exchequer and is calculated, according to the official statement of the Government Actuary, to bring about a deficit in the Unemployment Insurance Fund during the year of upwards of £2,000,000. I have listened in the course of all these Debates to the speeches of Ministers, and their tone always gave me the sensation of listening to someone repeating the old verse: The good that I would, that do I not, And the evil that I would not, that I do. If I can picture to myself the Minister, with her knowledge of the subject and the. sources of information that she possesses, I cannot imagine anyone who would be more likely to think of that verse as applying to her own case. Look at the Bill for a moment in its effect on unemployment. We have a Government that came into power on the pretence that it can solve the problem of unemployment. The Prime Minister says they alone have a programme and they alone are the people who possess the ideas that will enable the problem to be solved. Again the Chancellor of the Exchequer himself told us that in twelve months time, when returned to power, he was confident that they would make a great impression on the magnitude of the problem. They have been in for nearly seven, and the only impression they have created is that they are perfectly incapable of dealing with the problem. What has happened up to now is that, instead of any reduction or improvement in unem- ployment, up the figures have been going week by week one after another until they are now more than 200,000 more than when they came into power. [HON. MEMBERS: "What about the figures under you a year ago?"]—a rise more rapid, in the same period of the autumn, than when we were in power a year ago. While the figures for unemployment have been rising wages have been falling, until there is a decrease of over £60,000 a week, a reduction of £3,500,000 a year. That is the moment the Government have chosen to force through the House a Bill which imposes an immense increase in taxation and a burden on the taxpayer. The Clause that was hastily redrafted and re-inserted on Report adds £2,000,000 of burden to the Unemployment Fund, so that it would no longer balance at the assumed figure of 1,200,000, and it adds a burden on the Exchequer equivalent to an increase of £50,000,000 on the National Debt—that one last hastily drawn Clause which the House has never been given an opportunity of criticising or analysing satisfactorily.

That course of action, as the Chancellor of the Exchequer knows quite well, of imposing one burden after another on finance has a disastrous effect on industry and employment. That is recognised by the Leaders of the Socialist party themselves. Not only does it hit industry and employment generally but it hurts industry in its most vital and most vulnerable part, in the matter of foreign trade. We all by now recognise—the Lord Privy Seal with the rest these days —that the greater part of our unemployment is due to the falling off of foreign trade. The one thing we wish to do above all others to improve the state of employment is to regain some of our lost foreign trade, and it is precisely these burdens placed on the taxpayer that make it the more difficult to regain it and the easier for the loss to become still greater. The Government have done this with complete deliberation. I was not in the House on the Second Reading but I took a great interest in what went on, and I read the very striking warning given by the right hon. Gentleman (Mr. Lloyd George) the Member for Carnarvon Boroughs. It is seldom that I have the privilege of seeing eye to eye with him, but in this case most of us could agree with every word he says: We are undoubtedly piling up a tremendous bill which this country ultimately cannot bear. I want to put that quite seriously. I can understand the hon. Gentlemen below the Gangway. They know that the country cannot stand it, and their purpose is to break down the system. From their point of view, as a tactical move, it is perfectly right to propose these additions year by year, because, if they succeed, the system will inevitably break down."—[OFFICIAL REPORT, 21st November, 1916; col. 771, Vol. 232.] At the end of his speech he said he proposed to give the Measure a Second Reading because it would be subjected to a close scrutiny in Committee, and he believed that Amendments would be moved to remove some of the objections to it. He was an optimist. The Amendments that have been made in Committee have meant a further imposition of over £4,000,000 of expenditure a year, the least justifiable and the least useful of all the expenditure that the Bill imposes, and it has all been the result of the amazing procedure of the last 10 days.

I would ask the House What is the justification for all this expenditure now that we come to review the Bill and look back upon it? The only claim that the Government can produce in justifying it is that it is the one way they know of meeting the objection to the condition about genuinely seeking work. That is absolute nonsense. We were, on all sides of the House, quite ready to join in meeting objections to genuinely seeking work. [An HON. MEMBER: "Why did you not do it?"] There is objection on the part of hon. Members opposite that we did not make speeches on the subject on Clause 4. [Interruption.] What sweet simplicity on that side of the House! As if they did not know that, if we were to support the Government in resisting a bad Amendment or bad proposal by making speeches, it would be one way of making their own extremists determined to force it upon them. It is perfectly obvious from the point of view of getting the Bill as little unreasonable as it might be that is was far better not to make speeches upon it in support of the Government.

It is not a Bill to meet objections about genuinely seeking work. It is a Bill, as the hon. Member for Westmorland (Mr. O. Stanley) said in his very striking speech, which for the first time takes away any defence that any of us had in the past for saying that it was not a system of doles. It is a Bill which transforms the whole insurance scheme into a system of doles. It is a Bill for the endowment of people whom the Attorney-General calls "work-shys." It is a Bill for the enrichment of people who are not deserving at the expense of the good workmen. [Interruption.] I say that quite deliberately. It is proved, and proved beyond all question by the Official White Paper issued by the Government themselves. Let me compare for a moment speeches by Ministers opposite with the official papers. Barely a month ago the Lord Privy Seal stated his opinion in public: If you ask me what it is that disturbs me most, I have no hesitation in saying that it is anything which makes men and women rely upon other efforts than their own. [HON. MEMBERS: "Hear, hear!"] Hon. Member cheer that. This Bill does the opposite. [An HON. MEMBER: "No, it does not!"] Let hon. Members read their own Official White Paper: The obligation placed on the claimant … is confined to taking steps to search for work in accordance with directions given … by the Employment Exchange. They go on to point out that if he does not do so, the proof that he does not lies upon the Exchange, and the Exchange in all probability will not be able to produce the proof. It is a pure farce. Take the next statement of the Lord Privy Seal: What disturbs me also is anything that tends to make people look to the State for the assistance which they themselves ought to provide. Let any hon. Members read the other sections of their own White Paper. The new provision introduced by the Attorney-General will have the effect of bringing other persons into benefit. Married women who have done little or no work since marriage; seasonal workers during the off-season these two classes will serve as illustrations of the considerable group of new claimants consisting of persons who, so to speak, are not really in the market as competitors for employment, but who hold themselves out as such if they are thereby enabled to qualify for benefit. The White Paper proves up to the hilt every single statement that I have made, that it is not the removal of difficulties in the way of a person who ought to get benefit, but that it is making it easier for people who ought not to get benefit. That is the effect of the redrafted Clause which we have before the House. That is the answer of this House to the appeal of the right hon. Gentleman the Member for Carnarvon Boroughs in giving the Bill a Second Reading. Four to four and a half million pounds more of expenditure upon doles to the unemployed at a time when we have £3,500,000 a year less earnings in wages of the employed. I say that to vote for this Bill on the Third Reading is the final destruction of any true insurance scheme and the creation of a system of gigantic relief to take its place—relief very largely to the undeserving at the expense of the good and honest workman. [Interruption.]

There is one more item which is even more significant than the changing of the Bill. It is the way in which the change in the Bill was made. When the Attorney-General brought in this new Clause, there was one striking phenomenon which occurred, and that is, what happened to the party below the Gangway, at the present moment represented by the hon. Member for Leith (Mr. E. Brown) and the hon. Member for Bodmin (Mr. Foot). It was really very remarkable. Not a single leader of the Liberal party voted for the new Clause —not one. If any one examines the Division list, he will find that there is no presence there of the name of the right hon. Gentleman the Member for Carnarvon Boroughs, or of the right hon. and learned Gentleman the Member for Spen Valley (Sir J. Simon), the right hon. Gentleman the Member for St. Ives (Mr. Runciman), the right hon. Member for Darwen (Sir H. Samuel), or the right hon. Member for North Cornwall (Sir D. Maclean) or any other of the leaders of the Liberal party. The hon. Member for Leith and his hon. Friend the Member for Bodmin and the other Members of the rank and file deserted them. They followed the Attorney-General. I suppose it was that the old influence of the Attorney-General was too strong. They that had loved him so, followed him, honoured him, Lived in his mild and magnificent eye, I forget the name of the poem—[An HON. MEMBER: "The Lost Leader"]—but it begins with the lines: Just for a handful of silver be left us, Just for a rihand to stick in his coat. Our objection to the action of the Government is much more vital. We always said, that, when it came to a crisis, the Government would always surrender to their own extremists. We have been met sometimes by critics who said, "Oh, surely you can trust the backbone of a Government when it possesses the Lord Privy Seal and the Chancellor of the Exchequer among its members." We have pure proof of the absolute justice of what we thought. There never was a more spineless capitulation to the extremists. I ask the House to condemn this Bill for its intrinsic demerits. It is a bad Bill, because it reduces the insurance scheme to a dole system, because it brings children into the dole system who ought never to be there, because it endows the work-shy and enriches the undeserving at the expense of the honest and good workman, because it increases taxation enormously, and because it is one of a series of Measures which is increasing unemployment as well. Therefore, we condemn it, but we regard it also as a proof of a danger which is graver and more far-reaching. It is proof that, when a crisis comes, this Government cares nothing for the employer, or employe, or the taxpayer, or for industry, or for employment. It proves that, when the hour of trial comes, there is no national interest so great that the Government will not betray it at the dictation of its extremists.

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden)

I do not think that the speech to which we have just listened has been worth the trouble which has evidently been expended upon its preparation, but I certainly congratulate the right hon. Gentleman and those who are associated with him in this Amendment upon their colossal audacity. This Amendment asks the House to reject this Bill on the ground that it imposes unanticipated financial burdens upon the Exchequer. The right hon. Gentleman says that, when the Minister of Labour was faced by the question of doing the right thing or doing the evil thing, she chose to do the evil thing. May I give the right hon. Gentleman another quotation, but not from the same source: The evil that men do lives after them. This Bill is the inevitable consequence of the policy which was pursued by the right hon. Gentleman, in association with the late Chancellor of the Exchequer, during the last five years, and which brought the fund into a state of bankruptcy. The purpose of this Bill is to try to restore something of solvency to the Insurance Fund. What was the position with which we were faced when we took office In the last 12 months, for which matters were under the control of the right hon. Gentleman, £12,000,000 was added to the debt of the Insurance Fund. When we left office five years ago, the debt on the fund was just over £5,000,000. When we took office, it was not far short of £37,000,000, or within £3,000,000 of complete exhaustion of the borrowing powers. The reckoning was only sufficient to cover an average unemployment of 1,000,000, whereas the figure had been from 200,000 to 400,000 above that figure during a considerable part of the tenure of office of the late Government.

The late Government, by the Act of 1927, reduced the contributions from 25¾d. to 21d. If that had not been done, the debt on the fund to-day, instead of being nearly £40,000,000, would have been only £20,000,000. We were faced by this problem, and there were three courses open, any one of which the Government might have adopted. We might have raised the contributions. If the contributions had been kept at the figure at which they were in 1927 we should not have had to deal with the financial problem which is embodied in this Bill. That was one thing that we might have done. Another was that we might have increased the borrowing powers. After consideration, the Government rejected both these alternatives. The right hon. Gentleman talked about the burdens upon industry due to the proposals which are made in this Bill. We rejected the idea of raising the contributions, because we believed that if that were done it would have been a more direct burden upon industry than if the necessary funds to achieve solvency were drawn from general taxation. I rejected borrowing for the reason that the floating debt, thanks to the financial policy of the late Government, has been immensely inflated. My great object is to reduce it and not to increase it.

Having rejected these two possibilities or courses, we were left with one other course, and that was for the Exchequer to assume the responsibility of keeping the fund solvent. That is the financial scheme which is embodied in this Bill. How are we going to do that? The financial proposals of the Bill are very complicated and very difficult to explain. I am going to make an attempt to explain them, but I am not very confident of my success in doing so. Our proposals will add to the Exchequer contributions to the fund a sum of £14,000,000. How is that made up? By the first Unemployment Bill of this year the Exchequer assumed the responsibility for equal thirds in the contributions. That involves an Exchequer contribution of £3,500,000. The other items making up the £14,000,000 are these—and an examination of these items will show how practically each one, with very insignificant exceptions, has been made necessary and inevitable in order to restore solvency to the fund and enable benefits to continue to be paid. Increased benefits to young persons is a very small additional annual charge on the fund of £370,000. Increased rates for dependants will cost—I am speaking now not of the cost to the Exchequer but of the increase to the fund—£1,750,000 a year. Then the altered conditions on which the right hon. Gentleman poured so much of his vitrol are responsible for the main financial burden on the fund. This will amount to about £7,250,000. Now as to the Exchequer share in these increased burdens on the fund. There is, first of all, the Exchequer recoupment for transitional benefit, which, without the two conditions I have mentioned, would have amounted to £7,100,000. Then the increased cost of this recoupment, owing to the improved benefits, including what is called the genuinely seeking work provision, amounts to £3,400,000. The net result of all this is that in effect the Exchequer is paying into the fund £14,000,000, while increased benefits will amount to £9,400,000, so that the Exchequer is paying in addition into the fund an excess sum of £4,600,000. I said that I had doubts whether I should be able to make these complicated figures clear, I have done so to the best of my ability, and it explains the increased Exchequer contribution of £14,000,000. There is an item of £500,000 which is due to the normal growth of expenditure under the Bill.

Sir A. STEEL-MAITLAND

Administration expenses.

Mr. SNOWDEN

Provision was made in last year's Estimates for an Exchequer contribution of £12,000,000. Next year the additions made in this Bill will bring the total Exchequer contributions up to £26,500,000, and, as I have pointed out, only a small part of that is really due to increased benefits; a larger bulk of it, of course, is due to that much debated Clause dealing with genuinely seeking work. It is not within my province, except so far as finance is important, to be an expert on the administration of the Unemployment Fund. As a matter of fact, I know very little about it. I have never had any practical experience of its administration, but, on the matter of genuinely seeking work, may I be permitted to say this: There are three classes of workmen, and the vast majority of each, perhaps I may say 99 per cent. of the workers, probably more than that, are honest, straightforward men, who prefer work to benefit, who feel a personal humiliation at being out of work, who when they are out of work will strain every nerve to get work. Then, there is the class which we may call the inefficient, who like work, who want to work, but who experience the greatest difficulty in getting work because of their lower vitality and their industrial inefficiency. Then there is that negligible class of men who perhaps would prefer to live, if I may use the expression of the right hon. Gentleman opposite, in State-endowed idleness rather than earn their living by work.

The point it seems to me is this, and I am not speaking as one who is at all an authority on these matters, that it is much better that one man in a thousand should get this benefit, even though he does not deserve it, than that 999 men out of the 1,000 who deserve it should not get the benefit. That seems to me to be the justification for the Clause of the Bill which is going to be such an expensive item to meet. I am prepared to defend it, and to justify it. I do not want to spend money unnecessarily, not a single penny. Over and over again throughout his speech, the right hon. Gentleman sneered at the Government and at their surrender to what he calls the extremists. I know of no such surrender. I know of Amendments which have appeared on the Paper which would have been very expensive indeed; but they have not been accepted by the Government. There was one Amendment which appeared on the Paper to restore a condition of benefit which was abolished by the right hon. Gentleman; an Amendment upon which, on its merits, a great deal might be said. Indeed, the difficulty of a Chancellor of the Exchequer is always this, that it is always very easy for an hon. Member to make out a good case for a particular Amendment and it is often very difficult to resist it. The Chancellor of the Exchequer has to decide not merely on a particular Amendment; he has to look at the financial problem as a whole and consider how much he can possibly afford.

There were three Amendments on the Paper, one to which I have just referred to reduce the waiting period to three days. That would have cost, I think, £4,000,000 or £5,000,000. The Government in 1924 could well afford it. The financial position in those days was very different from what it is to-day. I had a surplus of £30,000,000 on my Budget. My successor next year inherited, if I may be permitted to quote his own words, as the result of my careful husbanding of the national resources a surplus of nearly £40,000,000—the only surplus he ever had. We were able to do things in those days which we cannot possibly afford to do now. That Amendment would have cost £4,000,000 or £5,000,000. It was resisted. Is that an evidence of a surrender of the Government to the extremists 7 There was a further Amendment dealing with what I believe is technically called the continuity condition. I do not understand it, but it has something to do with raising the continuity interval from 10 weeks to 12 months. That would have cost another £5,000,000. We would not accept that. Is that further evidence of the spineless nature of those who are responsible? There was a further Amendment proposing to raise substantially the scales of benefit. That would have cost £12,000,000. Twelve and nine make 21. If those three Amendments had been accepted, there would have been an addition of £21,000,000 to the £14,000,000 of increased Exchequer contributions under this Bill.

There is, as I have said, a great deal to be said on each of those Amendments. But I have had to take the financial position as a whole into consideration. We are having to provide next year £14,000,000 of revenue to finance the schemes of this Bill, due entirely to the gross mismanagement of the national finances by our predecessors. We are seeing in the Tory newspapers some criticism of the extravagance of this Government. The Leader of the Opposition made the same point in the speech which he delivered in Edinburgh a few days ago. He talked about perilous extravagance and about our piling up expenditure. Yes, we are piling up expenditure in order to try to bring the finances of this country into an honest and sound condition, and —I very much regret to have to say it—we are not at the end of our task yet by a long, long way.

Let me give the Leader of the Opposition some figures. I regret that the late Chancellor of the Exchequer is not here, though I shall have other opportunities of reminding him of these facts. During the last three years—I hope that my hon. Friends on this side, at any rate, will make a note of the incontrovertible facts that I am about to submit to the House—the raids and forestallments of revenue have amounted to over £50,000,000; the sinking fund provision has fallen short by some £30,000,000. Legislation passed by the late Government has not been financed out of revenue. The year after next I shall have to find—[Interruption.] Hon. Members might have noticed that I hesitated before I made that statement; therefore I deliberately made it as I did. The year after next I shall have to find additional revenue amounting to £15,000,000 to finance the rating legislation. In the last three years the late Government undertook expenditure amounting to £95,000,000 for which they made not one penny of new provision. That is the explanation of the increased Exchequer contribution in this Bill. We are compelled unless benefits should no longer be paid, to make this provision. Officially, I need hardly say, I do not like it. If I had £14,000,000 to spend, preferably I would spend it upon something which would be more directly re- munerative. But unfortunately we cannot spend the same money upon two purposes at the same time.

9.0 p.m.

Reference has been made to what the Government actuary has said. He is stated to have said that there will be an increase of upwards of £2,000,000 in the Exchequer contribution next year and that in addition £2,000,000 will be added to the debt. The Government actuary does not say so. What he says is that upon the basis of a certain number of unemployed, 1,200,000 on the average, there will be an additional £2,000,000 of debt; but the Government actuary does not commit himself to the statement that there will be an average of 1,200,000 unemployed. The right hon. Gentleman opposite quoted something which I am recorded to have said, that in 12 months time we would make an impression upon unemployment. I stand by that statement, and I add this further—that we are not going to be judged by our unemployment policy at the end of 12 months. I certainly am not going to be judged on my financial policy on my first Budget. It will take, at the shortest two to three years to restore the finances of the country to the position in which they were in 1924. But I shall be gravely disappointed if the average of unemployment during the next 12 months is not below 1,200,000. Therefore that increase of debt is not likely to mature.

I state this further: If unfortunately something happens and our hopes are disappointed, I am afraid that we shall be compelled in a Bill next year to make further provisions for keeping the Fund solvent. I do not anticipate, however, that that very regrettable necessity will arise. I ask the House to give a Third Reading to this Bill. As I have said, the Bill is necessary. It gives moderately increased benefit; it will restore the Fund to solvency; and it will also redress a grievance which has been most keenly felt by hundreds and thousands, and indeed millions of men, among the most honest and hard working, of our industrial population.

Mr. FOOT

It is extremely difficult to follow the Chancellor of the Exchequer and one in my position can only recall those lines: As in a theatre, the eyes of men, After a well grac'd actor leaves the stage, Are idly bent on him that enters next, Thinking his prattle to be tedious. In the same way, in following the Chancellor of the Exchequer I have to ask Members of the House to allow me to explain a vote which I gave the other evening when I voted against the new Clause which I think is the essential part of this Bill. Some hon. Members will recall the discussion which took place on the 5th December. I said that I had heard practically every word of that Debate and that I did not know when I had been called upon to give a vote which cost me more anxiety and apprehension. I am bound to say that what I have heard since on that point in this House, including the speech of the Chancellor of the Exchequer to-night, has not lifted that apprehension from my mind. I voted the other evening against the new Clause—the Clause which took the place of the original Clause 4 of the Bill —and I want to bring before the House, some of the considerations which weighed with me, as one who voted for the Second Reading of the Bill. If I have not heard every word of these discussions I have read every word of them, and have read as diligently as I could the evidence given before the Morris committee. I have read what the majority of that committee had to say and I am still not satisfied that I ought to give my vote in favour of the Clause which was passed the other night.

It is the central part of the Bill. I think there can be no doubt about that fact because, when the Minister introduced the Measure, she did not deal with this Clause in its order. She took Clause 4 first of all and dealt with the other Clauses as subsidiary or ancillary to it. The Gibraltar of the situation is Clause 4. A great deal of what has been said by the Chancellor of the Exchequer had o bearing upon Clause 4, but I want the right hon. Gentleman to see the matter as it appears to me. I agree with him absolutely as to the fourth statutory condition. I do not think that anyone can sincerely and vigilantly read the evidence given before the Morris committee without coming to the conclusion that that condition ought to be swept away. I do not think that the charge of administrative persecution was proved. I think it was not proved as far as I can see from the evidence, but there was, undoubtedly, a cumulative grievance and bitterness and discontent, with a hardship inflicted on the most helpless part of the population. My sympathy, first of all, is with the unemployed people. I refuse to think of the unemployed in terms of figures and statistics and curves and descriptions in bulk. I always remember a famous passage by Carlyle in which, referring to the time when the aristocracy of France referred to the "masses of France," he says: Masses indeed! But follow them, if you will, over the broad land of France into their hovels and into their hutches, and you will find, strangely enough, that the masses consist of units, and every man stands there with his own heart and sorrows and covered with his own skin, and, if you prick him, he will bleed. I refuse to approach this question of unemployment except from the recognition, as I said the other evening, that those who are in most need have the first claim upon the community. The fourth statutory condition was, I think, a hardship inflicted upon these men. It had to be swept away and the majority of the committee so reported. Then changes were suggested in this House and were embodied, after deliberation, in the Bill and I think it is simply playing with words to say that the Bill as introduced by the Government, after, as I suppose, responsible deliberation, did not bring about a very substantial change. [HON. MEMBERS: "No!"] Of course it brought about a change. It changed the condition—changed it from a condition into a disqualification—and It lifted the onus off the shoulders of the man and placed it for the most part on the insurance officer and the machine. [HON. MEMBERS: "No!"] At any rate, that is my submission and it. was the opinion of the majority of those on the committee and it was the opinion of the Government. It was the opinion of the responsible officers of the Government who explained it in this House. I hope I shall say nothing provocative. There is no attraction to me in making this speech which I must make to-night. I shall be happy to hear all that is said, and I shall refer directly to the hon. Member for Camlachie (Mr. Stephen) who has been kind enough to speak to me on this matter.

I say that it is playing with words to suggest that there was not a substantial change made by the Bill as it was put before the House. I heard the proposals put before the House by the Minister. I heard them explained by the Attorney-General and in those proposals there was a statutory declaration of the principle that the unemployed man must himself seek for work. That undoubtedly was the centre of the proposals in Sub-sections (2) and (3) of Clause 4 of the Bill as it was introduced. The Minister herself said it was "essential." She said that the House ought to be warned against a grave mistake, and the Attorney-General said afterwards: There is a danger of being led away by our sympathy to do something which is really unwarranted.''—[OFFICIAL REPORT, 5th December, 1929; col. 2693, Vol. 232.] That was a warning not by anyone on these benches but by a responsible officer of the Crown in relation to a Bill upon which there had been months of deliberation. I was convinced by the Attorney-General. I listened to every word he said. It has been suggested that every speech made from these benches was against that Clause but such is not the case. I stood here in my place and said that I thought there should be in the Measure, as it left the House, an expression of the statutory obligation upon the unemployed man himself to look for work. Then the Government gave way and promised to bring in another Clause. That was on 5th December, and by 12th December great things had happened. There was a Financial Memorandum which did not reach me until just before midnight on the Wednesday night. I do not know very much about the Financial Memorandum but I think the criticisms of it have been undeserved. I am inclined to think that if ft had supported hon. Members opposite in their contention they would have quoted it with great eagerness. Whoever was responsible for the Memorandum was a courageous man. He discharged his duty and expressed his opinion frankly.

We cannot set the Financial Memorandum on one side, otherwise it is no use having financial memoranda at all. I assume that the officer who hurriedly had to prepare it, discharged his duty in such a way that he can justify his views in the light of the experience of the next year or two. There is the difference between a civil servant and a Minister. The Minister is here one year and not here the next, but the officer is here next year. He has to stand the criticism and the test of experience. In this case he made a criticism in the Memorandum as to the immense expenditure involved and then came the Debates upon 12th December. I think they were amazing Debates. I came to hear what the Minister had to say on the point which she had described the week before as "Essential." She dismissed it, I thought, in a few perfunctory phraees. What was essential on the 5th of the month had become unimportant on the 12th. What was cardinal on the 5th had become almost irrelevant and unimportant on the 12th; and the attitude of the Attorney-General on the 12th was such that I have no words left in which to express my surprise. On the 5th he had put that question that he is never likely to be allowed to forget: Are we to legislate on the lines that these people should think that they need do nothing themselves; that they should wait at home, sit down, smoke their pipes, and wait until an offer comes to them? "—[OFFICIAL REPORT, 5th December, 1929; col. 2687; Vol. 232.] I can imagine the derision that would have arisen in this House if that bad been said from the Front Opposition Bench, but it came from the Attorney-General. That was the question that was put on the ah. On the 12th we had the answer, and the answer was in the affirmative. [HON. MEMBERS: "No"] My submission is that as the Bill at present stands there is no obligation whatever upon a man to lift a finger. [Interruption.] That was the interpretation given by the Attorney-General. If that is wrong, then all my argument is wrong, but the assumption is that a man who is away from his Employment Exchange need not himself, until he has received written instructions, lift a finger to find work. [Interruption.] I would not have minded so much if the Attorney-General had said that he had to bow to the will of the House, but what I could not stand was that he should have made this change, and then spoken proudly of it and, in full view of the House, adjusted the plume upon his helmet and pinned the medale upon his own breast. That is what he did in the course of the Debate, and he congratulated himself upon his courage, when he had been obliged to give way and to change the position which he himself had taken on the 5th of the month.

My suggestion is that there is one statement made by the Attorney-General on the 5th, and there is another on the 12th, and I had to make my choice between the two. I was convinced by what he said on the 5th; I was not convinced by what he said on the 12th. I went with him in his advance; I was not prepared to go with him in his retreat. [An HON. MEMBERS: "He advanced further!"] I do not know about that. I hope that, for his own reputation, the Attorney-General will not be obliged to make speeches like that with the short interval between them or seven days. Otherwise, there may come upon him the words once written in describing a statesman in this House a very long time ago: His ready tongue, with sophistries at will, Can say, unsay, and be consistent still. The submission that I make is what I tried to say on the 5th. [Interruption.] My hon. Friend who represents Middlesbrough lives in a distressed area, and I. can quite understand his desperate concern on these matters, but we who live away from those distressed areas can also be concerned, although we are not brought into such close contact with the problem. There is a difference between one place and the other. There is a great difference where the workpeople scarcely ever see the Employment Exchange at all. I live in a part of the country where my people do not usually go to the Employment Exchange. Because of the distance, they do not go to register, and they do not go to receive their money, under what, I think, are the very reasonable arrangements made by which a man is not required to go eight or nine miles just to sign a paper, and his money is sent to him instead. There are some exceptional parts of the country where the Exchange is 100 miles away from the men concerned; and there should be some recognition of the difference between the distressed areas and the ordinary areas of the country. I was astonished to hear what was said by the hon. Member for Ebbw Vale (Mr. A. Bevan), who speaks also for a distressed area, and who made a speech from an experience of winch I know nothing. He was criticising the Attorney-General, and he said: The Attorney-General let the thing out in all its naked horror at the beginning of his speech. He let the Committee understand that what he desired to do was to devise a Sub-section which would leave the applicant for benefit to understand that he was expected to seek out the employer. I never expected to listen in the House of Commons to a spokesman of a Labour Government making such a statement as that."—[OFFICIAL REPORT, 5th December, 1929, col. 2696, Vol. 232.] That may be quite right as far as the hon. Member for Ebbw Vale is concerned, but I thought it was common ground with most people that the unemployed man owes a duty to those of his fellows who are contributing to the fund. [Interruption.] I hope there is nothing provocative in that. I am a man of peace, and I do not want to stir up wrath. The hon. Member for Ebbw Vale said he never expected to listen in the House of Commons to a spokesman of a Labour Government make such a statement as that an applicant should be expected to seek out the employer. I should have thought it was a very proper obligation upon him. The trouble is not in explaining this to the employers, but in explaining it to the workpeople. While these Debates have been going on, I have received a letter from my part of the country from a foreman in a certain works in the northern part of Cornwall, not a constituent, but a man knowing something of what is going on here. He writes: We have about 30 men employed on the works. The progress of the works is absolutely dependent on weather and tides. The men are required every minute it is possible to work, but at other times they have to stand off, without pay. It is impossible to pay them standing-off pay, or retention money, and keep the cost of the work within the estimates "— This is a public concern— and the limited amount of money available for the works. Unfortunately, the past few weeks these men have not received as much money as they would have done had they been wholly unemployed, and on the dole.' This naturally causes dissatisfaction, and to-day some of the men asked the foreman to discharge them, so that they could go on the 'dole.'

HON. MEMBERS

Shame!

Mr. FOOT

I am not blaming the men, but there is the position, which is made difficult by reason of the temptation—!

Mr. LAWTHER

"Lead us not into temptation." [Interruption.]

Mr. DEPUTY-SPEAKER (Mr. Dunnico)

Hon. Members will have an opportunity of replying.

Mr. FOOT

I am using the term used by the Minister of Labour in speaking of temptation, and I will tell the House of a paragraph to which she put her name in the Blanesburgh Report, where it speaks of the benefits that should be given: It should provide benefits definitely less in amount than the general labourer's rate of wage, so that there may be no temptation to prefer benefit to work. [Laughter.]—The laughter of hon. Members opposite should be aimed in another direction than over here. That the temptation exists, who can deny? I agree with all that is said from the benches opposite to the effect that the great majority, the overwhelming majority, of the workmen and women are as deserving as any class in the community and probably more deserving than many classes, but while I will admit that, I say that it is pure political pedantry to deny that there will be, for a certain number, a temptation such as is here described. The trouble is not between the ordinary classes in this country, between the employer and the workmen, but between one workman and the other. That is where the disaffection exists. I went down the other evening to a part of my constituency where the men go out day after day to work in perilous conditions and when they come back after a perilous journey over the rocks with great danger to themselves, there is not a man in that community who in the last two years has on the average earned as much as is provided here. [HON. MEMBERS "Shame!"] It is not a question of trouble with employers. There are no employers there. [HON. MEMBERS: "Middlemen!"] Yes, middlemen, and I hope my hon. Friends who talk about middlemen will insist on having something done. That is the fact to-day and the difficulty is not between employers and workmen but between one man and the other. Just as in the old story of the men who went into the vineyard, the trouble at the end of the day was not between the owner of the vineyard and the workers, but between those who thought they had done a full day's work and the others who had not. I do not say they were justified, but the trouble did not arise between the owners of the vineyard and the men.

Mr. STEPHEN

What was the answer, and does the hon. Gentleman approve of the answer?

Mr. FOOT

Of course I know and I approve of the answer. For myself I would say that the unemployed man should not suffer because he is unemployed, but I want to guard against this if I can. The hon. Member for Camlachie (Mr. Stephen) took a very proper stand on this matter when it came before the Committee. He brushed aside all considerations about this being an insurance fund and when he was questioned he said that he and his friends stood for the principle of work or maintenance, a definite job or benefit—nothing more and nothing less. I think that is a perfectly understandable attitude and I appreciate the position that he and his colleagues took up, but this is not the principle of work or maintenance. If it is to be done, let it come forward as a proper scheme and not as part of an insurance scheme where you collect contributions from many people, who can have those contributions protected only by ourselves. There is an obligation in regard to those people who have been paying in and who have no choice in the matter. I do not want to quote trade union regulations, although they were quoted by the Minister. Every trade union regulation has this provision and insists on the obligation upon the man himself to seek work. [HON. MEMBERS: "They are voluntary organizations!"] Whether voluntary or not, surely my hon. Friends will realise that there is just as much obligation to look after the money contributed and with which we have to deal as there is for a trade union to look after the money contributed by their members.

Mr. T. GRIFFITHS

The point I make is that you cannot get out of the State schemes but you can out of these others.

Mr. FOOT

That is certainly no argument. I was submitting that we had the interest of these contributors in our hands and, whether we like it or not, we are the trustees for them and must discharge that trust in the same way that we discharge our trust in the case of national money. Therefore, I think in this Clause the Bill goes further than it has any right to do, and although I welcome the concessions that have been made by the Minister and what else has been done in the Bill to help to meet the needs of the unemployed, I cannot see that there is any case for this new Clause, and unless there is some additional and more convincing argument than I have yet heard, I shall very reluctantly be obliged to withdraw my continued support from this Bill, which I have been very glad to give so far. I simply ask it we ought not to have in relation to national funds a similar obligation to that which exists in every well-managed trade union in the country. That contention, not easily made, I submit in all sincerity for the consideration of the House.

Mr. MAXTON

I have listened twice to the hon. Member for Bodmin (Mr. Foot) upon this same Clause, and, as in previous cases, I have been tremendously impressed with the fact that he is a man genuinely and honestly struggling with what is an intellectual and moral difficulty for himself. There are two moral difficulties in relation to this: first, he is afraid that when the onus to look for a job is taken off the man, that man will not look for it.

Mr. FOOT

In some instances.

Mr. MAXTON

I represent a constituency that is very badly hit by unemployment. I know the men and women who have been unemployed for extended periods, and on their behalf I say that the devices, schemes, private enterprise and initiative that they show in the attempt to earn a living—selling newspapers in the streets, calling at the doors exchanging old clothes for earthenware and pottery, selling rosettes of the rival colours at football matches and going round various places where crowds congregate, in the attempt to make a living for themselves—the amount of private enterprise and initiative shown by those people, who are supposed to be the down and outs, is very much greater than any I have seen on the part of private Members in this House during the years I have been here. Here for the most part we follow like sheep, but there those people, driven back on their own resources, make all sorts of attempts to find work for themselves in any method of earning a livelihood. I do not see the danger of the principle of self-help, private enterprise and initiative being destroyed, even supposing that the failure of statesmen, industrialists and financiers in these last eight or nine years has made it impossible for all the population to be employed at any one time. That is the important point which the hon. Member should get into his Fnind—that the system cannot employ the whole population which is prepared to work, and the man who is unemployed cannot decide. He has no power to decide what the bulk of unemployment is going to be. It is we here who have the major responsibility, and the captains of industry and so on outside. More and more it is recognised that if this failure to employ the men of our working population is to be rectified in the future, it is here that it is going to be done. An unemployed man cannot reduce the total number of unemployed by one; he can only decide that he is going to be in and somebody else is going to be out.

We, as representing the whole community have no right to take advantage of the position. We have a duty to see that the man who is outside the range of employment which the community can provide has got to be maintained decently and in decent physical conditions. Nobody in this House attempts to deny him that right. Nobody would get up and dare to say plainly, bluntly and honestly, that that man has got to starve if he is unemployed. But hon. Members and right hon. Members above the Gangway seem to think that if he is maintained in a definite irregular way by a cross between private charity and the Poor Law, his character, self-respect and independence of spirit are maintained. If by a series of devices and subterfuges he gets a penny here and sixpence there, scrounging on his friends and relatives and the Poor Law, his self-respect and manhood remain, but if he walks down honestly to the Employment Exchange, and signs his name and gets his money, in some way he is debilitated morally. It is far more decent, it far more makes for man- liness if there be a straight bargain between the man and the community, and that is what this Bill does with reference to the unemployed man.

The Chancellor of the Exchequer seemed to make some apologies for surrendering to his so-called extremists. [Interruption.] Let me say that he made some sort of defence against the charge that he had surrendered; I do not want to spoil a good point by putting it in language that is not absolutely accurate. I may say, incidentally, that it is one of the greatest jokes against present-day society that the man who comes here and asks for an extra 3s. for an unemployed man can be dubbed an extremist. That is a joke on the whole body politic, but I hope that there will be many similar surrenders, if they are to be called surrenders. I hope that this House as a whole will not regard it as undignified for the Government to alter their proposals in the face of the genuine criticism of this House.

The other point which my hon. Friend the Member for Bodmin is worrying about is that men who are employed should receive less than what they can receive when unemployed. I am disturbed about that, but not very much disturbed about it, for surely the remedy is the obvious one of not to get the unemployed man down below the level of the lowest scale of wages that is paid anywhere in the country, but to get. the least paid man anywhere well above the allowances that are paid for unemployment. At the proper moment, the group with which I am more closely associated will present in this Chamber a scheme to secure a living income going into every home and to every employed man.

Mr. FOOT

A married man with three children receiving unemployment benefit will get more than any agricultural worker.

Mr. MAXTON

I will make special arrangements to have sent to the hon. Member the living wage proposals of the Independent Labour party.

Mr. FOOT

Before the hon. Member sends it to me, will he convert and convince his own Front Bench?

Mr. MAXTON

Can two things go on simultaneously? I am not casting my bread on one particular set of waters only, and I think that I can say on behalf of my Friends that we shall be delighted to send a copy of our scheme for raising the wages of the workers to every Member of the Liberal party. I think that our funds will stand that. It seems to me that that is the intelligent, the sane and the moral way of cutting into the vicious circle which a vicious social order has created. You have got to begin somewhere, and here is a point where we should begin. I am sorry that the Chancellor of the Exchequer did not accept the higher level of scales that we proposed, because I believe that those scales would just provide a basic physical efficiency. After all, when you have argued all round the question of demoralisation and self respect, it is, fundamentally, a question of physical efficiency —the ability to keep yourself fed and clothed decently. A man driven on by fear of starvation cannot be considered in the category of moral or non-moral at all; he is driven on by pure physical necessity. The question whether a man is moral or non-moral arises only after he has got the material things of life. I hope that the hon. Member for Bodmin and the right hon. Gentleman the Member for Bewdley (Mr. S. Baldwin) will both depart from their niggling attitude towards this Measure, wipe out the sins of the past, and come into the Lobby in support of the Third Reading of this Bill.

Mr. CULVERWELL

The hon. Member for Bridgeton (Mr. Maxton) has made a speech which is generally familiar to us, and I cannot help thinking that it is a waste of time at this late stage of the Bill to address to the House a speech of that sort, which he must have made on many occasions upstairs to Members of his own party. It is a speech with which the right hon. Lady must be very familiar by this time, and it is one which has been successful in securing the abandonment of her resistance to the extremists. At this stage of the Bill, I do not wish to pursue the arguments of the hon. Gentleman; but I would like to express my strong opposition to this Bill, an opposition which has been in no way broken down by listening to most of the debates which have taken place on the Bill. Nearly every speech has convinced me more than when I first saw the Bill that this Measure is vicious in principle and will be burdensome in practice.

My first great objection to it is one shared by every Member on this side of the House, the Bill abandons the whole spirit of insurance, and, instead of being an Insurance Bill, is really a poor relief Measure. It draws into insurance a class of persons among whom there need be little unemployment. I do not wish again to go into the figures which indicate a decrease in the number of juveniles and a consequent shortage of unemployment among them in the next few years. I am sure hon. Members opposite will find that these young boys and girls are being asked by the Minister to contribute to the fund either in order to bolster it up, or else that they will be led into the temptation of living in idleness. That is my first objection to the Bill, that it brings into insurance a new class of workers amongst whom there is little chance of unemployment, and can only have the effect of either demoralising them or of using their contributions to bolster up the fund.

My second great objection, which is shared by all the Members of the Conservative party and, judging by the speech of the hon. Member for Bodmin (Mr. Foot), by a great many Members of the Liberal party, is that in the middle of the proceedings on this Bill, which was the result of many months of consultation and careful consideration, the Minister has changed the whole principle on which benefit has been paid out in the past. She has altered the whole basis of the Bill, and shifted the onus of proof from the claimant on to a Government Department. If anything is a surrender to the extremists, that is. The hon. Member for Bridgeton (Mr. Maxton) was not singing quite so high a note to-night as I thought he might have sung, because if there is one Member of the House who has emerged in triumph from these debates, it is surely he, supported by his friends. He has secured from the right hon. Lady against her better judgment, a complete surrender on what we regard as a vital principle regarding the paying out of unemployment benefit. If I may use a simile without being disrespectful, I would suggest that for a long time the right hon. Lady has been engaged to the hon. Member for Bridgeton, but that since June, when the banns were put up, she has been carrying on with the right hon. Member for Tamworth (Sir A. Steel-Maitland). For months she has accumlated evidence in support of her behaviour, and came down to the House, accompanied by her legal adviser, fully prepared to defend herself against the action which the hon. Member for Bridgeton was bringing aginst her, an action for breach of promise. [HON. MEMBERS: "Oh!"] In the middle of the trial she abandons her defence, gives up her new love, the right hon. Member for Tamworth, and returns to her old love. I think that is a correct summing-up of the situation, and the right hon. Lady must not be surprised if we on this side of the House accuse her of fickleness, instability and weakness. I only wish I could think that the right hon. Lady and the hon. Member for Bridgeton would live happily ever afterwards, but I am confident that she will never derive happiness from association with such a spendthrift as the hon. Member for Bridgeton, and the Chancellor of the Exchequer has made it pretty clear this evening that the hon. Member will never receive such a liberal allowance as will satisfy him.

That brings me to the third great objection which we on this side have to this Bill. It was the objection which was brought against it by the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) at the beginning of the discussions on the Bill, when he spoke in very forcible terms. In that speech the right hon. Gentleman drew attention to the heavy cost of this Measure, and pointed out that, whilst individual items of expenditure could be justified in this House, and were exceedingly difficult to resist as individual items, yet in their cumulative effect they imposed such a burden 'as made it impossible for industry to carry on; but in spite of that the Members of the party of which he is leader have spent most of the time since in proposing Amendments which would have added to instead of lessening the cost of the Bill. I would like to refer to a speech made the other day by the Lord Privy Seal. He realises the great burden which our social services impose on the competitive power of our industries in world markets. He realises, as members of his party are beginning to realise, and as, apparently, they did not understand during the Election, that you cannot add to the burden of the social services in the way this Government are doing without crippling the competitive power of our industries in world markets. The Lord Privy Seal said: Our social services, too, were infinitely higher than those of any other nation. They must be paid for, and could only be paid for, by exports, and that was why he refused to subscribe to the belief that we could cure unemployment by merely spending money. Any fool can spend money. I recommend that remark to hon. Members opposite— If you add to the dead weight of the capital of the country, you render it more difficult for your own people to compete in world markets. You do not help unemployment, you aggravate it. That is a speech which might have been made, and, in fact, was made, by nearly every Conservative candidate at the last General Election, and for speeches like that many of us were howled down, abused and criticised at public meetings. Yet the Lord Privy Seal is a Member of a Government who have made an abject surrender of the principles which he has laid down, and of the principle., which the right hon. Lady herself had laid down previously. We can only regret that the course of the discussion on this Measure has been so much handicapped by the shilly-shallying methods of the right hon. Lady. She makes up her mind to a course, after months of deliberation, and then alters the whole principle of the Bill and asks us to sanction that alteration of principle upon the Report stage. I feel that the right hon. Member for Tam-worth had the support of most Members of the House when he complained bitterly of the gagging of the Opposition by the Government. That is the last thing one would expect from a Socialist Government, which is supposed to believe in democracy and freedom of speech, and I should like to add my protest against the regrettable manner in which this Debate has been conducted by the right hon. Lady.

Hon. Members opposite are paying far more attention to the unemployed than they are to the employed, and I believe that the working men and women of this country who, in the long run will have to pay for this costly Measure, will see how unwise it is that their savings and their contributions should be spent upon those who are not properly certified claimants on the Fund. We on this side protest against this lavish and reckless distribu- tion of public money. It is by these methods, by this half-hearted attempt, this first instalment, the effort to fulfil the fantastic and impracticable promises which hon. Members made at the last election that they will be judged. They will not be judged by a lavish and reckless distribution of money but by the amount of unemployment which the Government finds for the people by a sound and economic policy.

Mr. MUGGERIDGE

It has at last been recognised that the responsibility for unemployment must be placed upon the Government. There is really no way out of it. Hon. Members on the opposite side of the House wriggle and try to put the cost of the maintenance of the unemployed first on this fund and then on the other, but ultimately their action makes it clear that they are quite aware of the fact that in the end you have somehow or other to support your unemployed. Full responsibility for the unemployed is now frankly accepted by this House through the various Bills which we have passed. I want to point out that what the Government have done has been done in order to meet this responsibility. The Government, have decided to cover the risks of unemployment by a form of insurance. It is said in the last resort that you must take care of the people who are thrown out of employment, and the way the Government propose to do it is by supporting an insurance scheme and accepting the ultimate risk for which they practically admit responsibility.

In the first place, this insuranuce scheme is a very imperfect attempt to take on the full responsibility for the social conditions for which they admit responsibility. This Unemployment Insurance Bill has come along, and it has taken as a step further to the full condition of State insurance for unemployment. It is an admission taking us a long step further along the line of acceptance by the State of full insurance responsibility for the unemployed man. The Government have not attempted to get rid of that responsibility; they are attempting to organise their acceptance of that responsibility, and I have no doubt that every civilised country in the world, sooner or later, will follow our example and accept the principle of national insurance. On the other side, there have been various attempts to show that this is not an Insurance Bill, and I wish to reply to that argument by saying that this Bill is far more an Insurance Bill than the one which preceded it. It is an insurance against unemployment. It is an insurance against unemployment in the same way that one can get in the City of London an insurance against fire, except that in this case, on account of the conditions prevailing and the responsibility of the Government, it is made compulsory, but the principle is the same.

10.0 p.m.

Those who are opposed to this Measure say: "No, the unemployed ought to be made to seek work, and have the responsibility thrown upon them." That suggestion is quite inconsistent with the practice that applies with regard to fire insurance. If I have a loss in my house through fire, the only thing I have to prove is that the article destroyed was destroyed by fire, but, if the insurance society wishes to dispute (my claim and say, "Yes, there has been a fire, but you made it yourself," the onus of proof is upon the insurance society and not upon me. With regard to unemployment insurance, the principle, which has now been fully accepted by the Government, will be more and more accepted by future Governments until the whole responsibility for the care of the unemployed falls upon a properly constituted Insurance Fund. Hon. Gentlemen opposite wish to adopt quite a different principle from that which has been adapted by the fire insurance people. The only thing you ought to have to prove with regard to unemployment is that you are unemployed, and, if you are unemployed, then you are entitled under any proper insurance scheme to insurance benefit so long as you are unemployed. Hon. Members opposite say that a man may be unemployed by his own action because he will not accept work. In that case, the onus of proof rests upon those who dispute the fact. This Bill contains the much disputed Clause 4, which adopts the true principles of insurance. Until we adopted that Clause and worked out this principle along the lines now proposed, we had not brought unemployment insurance up to the same business footing as insurance against fire, and other risks which you can insure against in the City of London. All you have to prove in the case of fire insurance and other risks is your lass. If it is alleged that your loss is self-imposed by your own action, the onus of proof rests upon the insurance society. At last, the Government have put the unemployed insured man upon a proper footing, and, if he falls into unemployment, whether it is due to his own action or somebody else's, the onus of proof is upon the State.

In the country, there are three parties to our system of national insurance. There is the employé who is a compulsory contributor, and there is also the employer who is likewise a compulsory contributor. In addition to these two parties, the State comes along as a third party but with an unlimited liability. By the mere fact of making unemployment insurance compulsory, the State accepts the liability to pay the scale of benefits whenever unemployment occurs. In other words, it accepts unlimited liability. The Chancellor of the Exchequer has just told us that insurance has been adjusted to this particular case. The State, as a third party to the insurance, is bound to take up its unlimited liability and meet the necessities of the situation, and to see that every unemployed man is insured.

If I am correct in my reading of this Bill as the nearest approach that we have yet made to a competent and complete insurance against unemployment I want to say that to some extent it is an epoch-making Bill because it deals with unemployment along the only lines upon which you can deal with it until you can find, as the Government are trying to find, other means for dealing with unemployment—the only lines upon which in a civilised community you can really meet unemployment. I am persuaded that, although successive Governments will take every step they can to increase the volume of employment, if you like by stimulating trade, they will never go back upon the principle of insurance that is now adopted, and that what we are laying now is the foundation stone of a system of insurance that shall adequately deal with the problem of unemployment in our community. That, to me, is one of the great virtues of the Bill.

I have listened to speeches from the other side, but not one of them would convince a man who is capable of thinking out the problem from the social point of view. They all deal with small quibbles—the quibble, for instance, that this is an addition to the cost of our social services. Is not the Poor Law a social service I The Poor Law unfortunately is a social service, although I am one of those who believe that it is in process of disappearing, of being dissolved into its component parts, to be dealt with in a way entirely different from that which has been handed down to us from Elizabethan days. That costs money, and unless hon. Members opposite will take the courage of their convictions and say that, rather than add to the social burdens of this community—whether they are burdens contributed to through the taxes or whether they are burdens contributed to through the rates —they would rather that the unemployed man dropped down in his tracks and died, it is not for them to complain that this Government by their action have added to the cost of our social services. It is quite clear however that they are not prepared to take that line, and their argument is a mere quibble, a mere attempt to put on to the local ratepayer the cost which rightly belongs to the State.

If there is one thing that is more clear than another to anybody who is a student of unemployment and its causes, it is that unemployment is not a matter that arises from local conditions, but that it arises from national causes. Anything that affects our trade, for instance, will immediately react on such localities as West Ham and the great Division that I represent, the Division of Romford, where a large number of dock labourers live. The unemployed there have to be supported by the Board of Guardians when they have run out of benefit by leaps and bounds through any prolonged trouble in the docks of London, although the docks are outside my own particular constituency.

The problem is a national one. I am not saying that on this side or on that that we have arrived at the solution of it, but, so long as we admit that it arises from national causes over which the individual victims have no control at all, we as a House must not only face up to our responsibility, we must not only inquire into the causes, but we must not shrink under the burden that has been voluntarily undertaken in this and preceding Parliaments, of facing up to the ultimate financial costs of keeping these victims of an industrial system which we have not created, but which we are carrying on, and for which we are not responsible except as regards studying and finding the proper one to put in its place. We must face up to the necessity of meeting the needs of these people and keeping them at least in a. physical condition to become fit citizens of this country. That is an unavoidable necessity.

I rejoice in this Bill although it is only a small beginning. Hon. Members on the back benches behind me have complained about the 2s. for children. To offer 2s. for children is to belittle our own species; I say so frankly in this House. To offer a woman 2s. to keep her child—an English child, a precious gift to the community—[Interruption.] Hon. Members opposite laugh, but there is no more precious gift than a well-born child to this community, and I say that to offer the mother of a child 2s. a week is to belittle our own race and to put into contempt and disdain our own species. If I were going away for a holiday, I should hesitate to ask an hon. Member opposite, who might possibly be a friend of mine, to take care of a dog while I was away and to offer him 2s. for its keep. I should be ashamed to do it. But here we have had to accept the situation. I say, however, that, although these benefits are necessarily limited, they contain the principle which in this House we have more and more to face up to, namely, that we are responsible for keeping the men and women who through no fault of their own are thrown out from any opportunity or avenue of earning their own living—for keeping them in such a condition of physical and moral welfare that they will not cease to be citizens of this country.

Mr. E. BROWN

I do not share the enthusiasm of the hon. Member for Rumford (Mr. Muggeridge), and I doubt if he will in 12 or 18 months' time—

Mr. MUGGERIDGE

We will have another Bill.

Mr. BROWN

All I can say is that, if the hon. Member says that, he does not believe in his own argument about this being an Insurance Bill and an insurance system. Under this Bill money is to be spent in certain ways which, if I had my way, I would spend in other ways. [HON. MEMBERS: "Which way?"] For instance, I would rather have had a reduction of the waiting period than an increase of 2s. for dependants. [Interruption.] I was asked the question, and I answered it. I take the Bill as it is. To me the heart of the Bill is in what was known as Clause 4, and I am bound to say that I welcome the change that has been made. I do not agree with the statement that has been made that it was a climb-down on the part of the right hon. Lady to the extremists. The men who are known as extremists in this House had very little to do with that change; speeches came from every quarter of the Chamber in favour of the change. Moreover, whether or no the hon. and gallant Member for Kelvingrove (Major Elliot) approves of the change, he certainly did not approve of the Clause as it was originally drafted. He made that quite clear on the Second Reading. Let me recall to his mind what he said. Whatever he may say about the present Clause, in discussing the original Clause he made the same criticism that I made myself when I first read it. He said: The tests proposed are of a vague and unsatisfactory character, and that opinion is shared by a great many people on the right hon. Lady's side of the House. She says with the utmost assurance that this proposal shifts the onus from the applicant to the Employment Exchange but some of her own colleagues say with equal emphasis that it leaves the onus where it is now."— [OFFICIAL REPORT, 21st November, 1929; col. 763, Vol. 232.] There is another point in the same speech to which I will come in a moment, but I want to say about this change that it is a victory of the House of Commons over the Departmental mind. A great deal has been said inside the House and outside in recent months about the new despotism. This is the third major Bill dealing with this problem on which I. have spoken in the last five years. There has been the Bill of the right hon. Gentleman the Member for Preston (Mr. T. Shaw), the Bill of the right hon. Gentleman the Member for Tamworth (Sir A. Steel-Maitland), and this Bill. It is lime that this House, as a House, paid attention to the deep-seated feeling in the necessitous areas, where the bulk of these men are to be found. The House in 1924 accepted too easily the adaptation from extended benefit to standard benefit of the words "genuinely seeking work." The right hon. Gentleman's mechanical majority in 1927 in my judgment—II said so- when I sat two seats behind here — accepted Departmental opinion far too easily as to the effect of his rendering of the necessary legal formula to put into operation the phrase "genuinely seeking work."

The Bill gives me one thing that I want. Whether it gives it in the way that I want it is another matter. It gives me, for the first time, an objective test which is to be applied by the insurance officer to the case of men seeking benefit. Whatever the higher officials of the Department may think, the officials who have to do the practical administration in the Employment Exchanges will welcome having to deal with objectives rather than subjective tests. It is no wonder that Members for industrial seats feel warmly about the matter. The old system was called "not making every reasonable effort." In 10 months in 1926 in the port of Leith, where there are 25,000 insured persons and nearly 5,000 unemployed, through no fault of their own. There were 445 claims ruled out. Under "not genuinely seeking work" in the 10 months of this year there were 1,357 claims disallowed.

There is no man who knows the port of Leith, or any other of these districts, who does not know that what the Chancellor of the Exchequer has said is literally true. The fares of my hon. Friend the Member for Bodmin (Mr. Foot) need not trouble him. The great mass of these men, if they can smell a job, will make every effort to find it. [An HON. MEMBER: "Speak up!"] I intend to speak up on this matter. If these 1,357 claims, representing hundreds of men, could come here to-night, they would speak up, because they would feel as warmly as I feel on their behalf. The great bulk of these men will make efforts to find available work no matter what form of words this Bill may have in it, or any other Bill. We have for the first time a chance of catching the man who is a shirker instead of getting, as we have always had before, an Act which has let slip the shirker and entrapped the honest man. The re-drafted Clause 4 in a faint degree, at any rate, shows that the House of Commons at last is more aware than the Department has been, or than Ministers have been, as to the deep-seated feeling there is in these areas as to these subjective tests and their results. The form of words in my judgment gives the insurance officers a great deal more power than some of my friends recognise. I shall not be surprised in a month or two to hear complaints that the objective tests are not too mild but too stringent.

Mr. HOFFMAN

You are supporting it.

Mr. BROWN

I am. Nevertheless I say that. It is far better to give the insurance officers a situation in which there is a definite question to be put and a definite procedure to be followed, and a definite judgment to be given, than to put into the Bill this vague and unsatisfactory test to which the hon. and gallant Gentleman the Member for Kelvingrove (Major Elliot) referred in his Second Reading speech, or the vague and unsatisfactory laws we have passed in previous days. The hon. and gallant Gentleman did not only point out the vague and unsatisfactory nature of the original Clause but he pointed out that it might be said that the diligence test proposed in that Clause might be worse than the genuinely seeking work Clause of the 1927 Bill.

Major ELLIOT

indicated assent.

Mr. BROWN

The hon. and gallant Gentleman agrees and stands by his words. It is not necessary for me to say another word. If he says his words about the reasonableness and the diligence of the claimants' efforts are on Third Reading what they were on Second Reading, there is only one way you can evade the issue you there raise, and that is by putting into your Act the objective test. That test is in this Bill, not because of concessions to the extremists, but because at last, the House of Commons not possessing on the Government side a mechanical majority, but arguing out, I am afraid with some passion, what is really the case as to the effect in these black spots, which have been black spots so long we shall be able to go to our constituents and tell them they will be able to satisfy, not a vague form of words which the House of Commons cannot make fit two millions of differing cases, but objective tests. For that reason, I shall go and vote for the Third Reading of this Bill with more satisfaction than I did on the other two major Bills on which I have bad to vote on previous occasions.

Major SALMON

Those of us who had the privilege of listening to the Chancellor of the Exchequer to-night must have been surprised when he totally evaded one important point in the Memorandum of the Ministry of Labour. In paragraph (8) it says that it must not be overlooked that the new provision may have the effect of bringing a certain number of persons into benefit, for example, married women who have done little or no work since marriage and seasonal workers during the "off season." The point I want to make is that in arriving at the figures, the Ministry state in paragraph 11, Excluding any charges that may arise in the case referred to in paragraph 9, the effect on the Exchequer may be summarised as follows: The increased charge on the Exchequer in 1930–1931 will be about £2,000,000. The attention of the House and the attention of the Minister has been called to the fact that there is in existence a. real contingent liability and yet it is not being reckoned. We are told that the £2,000,000 really provides the necessary money for dealing with the new Clause 4. What strikes me most forcibly is that everyone in the House who has spoken from the Socialist benches has rather assumed that it is quite easy for the House to vote money irrespective of the fact that it is a contributory insurance scheme and not a relief of the guardians. As a matter of fact, the criticism one hears from the Socialist party about unemployment insurance to-day is that the benefits are not sufficient. If the benefits are not sufficient, they are as much as can he afforded actuarially to make the Fund sound or solvent. You can so easily increase the benefits, but, if you increase the benefits you must in return be prepared to provide for the payment of extra contributions on the part of the three parties involved, namely, the State, the employer, and the employe. That is what would be a sound proposition. That is not the recommendation of the Government. The Government's recommendations are, first of all, that they are dealing with an insolvent Fund. They say that they are the trustees of the public purse. How do they fulfil that trusteeship? They add to the liability, not because they found the Fund insolvent. If they found it insolvent, it is no reason why they should make it worse than it is. Admitting that it is insolvent, it is insolvent from many causes. I do not want to cause a long discussion on those causes, but the fact remains, through circumstances over which the late Government had no control, that the Fund did become insolvent. What has arisen? The Fund is insolvent. The Government say: "We will increase the rates to the unemployed. Not only that, hut we arc going to brush away all the protection that the Fund has had in the past a $ regards the provision for genuinely, seeking work. I believe that the introduction of the new Clause 4 will have a psychological effect upon vast numbers of persons. In the past they knew that they must attempt to get work, because they realised that they had to go through a very severe examination. I believe Plat the psychological effect of doing away with the existing protection will mean an increase in unemployment. When one hears it suggested by hon. Members opposite that it is a good thing to increase benefit because that will force, up wages, I reply that that is a very unsound argument, and one that is bound, not to increase wages but to decrease wages.

Mr. MUGGERIDGE

Is the hon. and gallant Member addressing me?

Major SALMON

I am addressing the hon. Member for Bridgeton (Mr. Max-ton). My point is, that the more money you distribute through the Unemployment Insurance Fund, which money if not provided by the three contributors must be provided by the Exchequer, the greater is the charge upon industry. The Chancellor of the Exchequer takes the responsibility, and says: "I am finding the deficiency." Of course he is finding it, but at our expense. He is finding it at the expense of industry, and the mere fact of the right hon. Gentleman having to find the money at the expense of industry means that he has to increase taxation. Some hon. Members opposite may think that it is a very good thing to increase taxation, but it has been proved time after time that the higher the taxation the greater the burden upon industry. In these days, as we have been often reminded, even by Members of the Socialist party, what we require is an increased export trade. If you are going to kill the manufacturer by forcing upon him such taxes, local and national, that he is not able to manufacture and compete with the world, you are not going to decrease unemployment but increase it.

Hon. Members opposite say that there is not sufficient being paid under the present insurance scheme to those who are out of work, but I would remind them that the cost of living has gone down since the time when the present rates were agreed upon.

Mr. McKINLAY

Is it not a fact that the cost of living has gone up?

Major SALMON

The cost of living has gone up during the time that the present Government have been in office. The Minister, who will reply, will be able to say that since she has been at the Ministry of Labour the cost of living has gone up, but during the period when the Conservatives were the dominant party the cost of living went down. We must not look upon this from a sentimental point of view. If we are going to deal with this as an insurance scheme, let us treat it as an insurance company would treat it. I wonder whether an insurance company, having a report from their actuary as to the contingent liabilities which exists by reason of the new Clause 4, would be prepared to offer the rates which are proposed in this Bill? I think they would not. They would recognise their responsibilities. The great trouble of the Socialist party, as was said by the Minister of Health, is that they have only to wish for a certain thing and they can have it; the country can afford it. What does it mean. It means that whilst they are pandering and promising, and giving large sums of money away, they are creating very great burdens for industry upon which we all depend. [An HON. MEMBER: "It is not out of industry; it is out of profits!"] We cannot live in this country except by our industries, and however you may argue, this will prove to be true. I hope the House will accept the Amendment and reject the Bill. Instead of being a good thing for unemployment it will only increase unemployment and do irreparable damage to this country in the near future.

Mr. SEXTON

I do not propose to detain the House for any length of time. I have only a few words to say, and they will not be controversial. I should not intervene at all, because the case for the Bill has been fully made out, but for the fact that I desire to say that the right hon. Lady has performed a most difficult task with that characteristic courage and ability that I always believed she possessed. Even her opponents on the other side of the House will admit that she has piloted this Bill through Committee stage and up to the present moment with great ability. She has found friends in unexpected quarters, and enemies where they ought not to have appeared. That is all I wanted to say. I heartily congratulate the right hon. Lady at the end of her task on the manner in which she has performed it. She has done excellent service which I think is recognised in all parts of the House.

Mr. MARJORIBANKS

I should like to associate myself as a very junior Member of the Opposition with the observations which have just been made by the hon. Member for St. Helens (Mr. Sexton). We all realise on this side of the House, whatever we may think about other ladies, that the right hon. Lady has a heart—

Mr. HOFFMAN

And a head—

Mr. MARJORIBANKS

Yes, and a head too. I do not think we can allow this Debate to conclude without congratulating the right hon. Member for Bridgeton (Mr. Maxton).

Mr. HOFFMAN

Right honourable?

Mr. MARJORIBANKS

I beg his pardon, honourable, but not right. I think we ought to congratulate the hon. Member for Bridgeton upon his great triumph.

Mr. HOFFMAN

It is not his triumph. You are wrong.

Mr. MARJORIBANKS

When I saw him sitting in his place he looked sad. There are moments when success makes one sad, especially when one thinks how much more successful one might have been. I am sure that he wished to be far more successful even than he has been, I would not have intervened had it not been for a challenge offered by the right hon. Gentleman the Chancellor of the Exchequer, who indulged in a far wider field of controversy than the present Bill. He went back not only to unemployment, but to the causes of this Bill; he went back and blamed the last Government for their financial policy; he said that he held them entirely responsible for the present situation. What do you think, Mr. Speaker, are the two functions in home government which are most necessary, which were most necessary during the last four years? The first, I suppose, was economy—above all things it was necessary to retrench. The second, I suppose, was to spend more money upon the social services, upon those who find the struggle in life difficult. What would you say of the Government which achieved both those things, which, whereas it spent in 1928 something like £20,000,000 less than the Socialists in 1924, spent something like £12,000,000 more on social services That may be regarded as a triumph of financial policy which right hon. Gentlemen opposite can not possibly evade—[Interruption]

Mr. SPEAKER

I must ask hon. Members to give the hon. Member a patient hearing.

Mr. MARJORIBANKS

There is another aspect of the Debate which cannot escape attention, and that in spite of the black ingratitude of the Front Bench opposite. That is the magnificent part which has been played in these Debates by my right hon. and junior Member for Preston (Sir W. Jowitt). I do not know whether he was present in the House on Friday. If he had been he would have heard one of the Secretaries of State say that after the mess which the lawyers had made of this Bill it was time that a layman—and such a layman! —intervened to save the situation. The right hon. and junior Member for Preston, the Attorney-General, deserves the very highest prize from hon. Members opposite for the magnificent pieces of sophistry in which he has indulged during these Debates. I am referring to a speech which he made on the first Thursday on which the Bill was discussed. He then said: I do not want any hon. Member to be under the impression that because we have taken this course in regard to Sub-section (1) we have therefore in any way weakened the position which we take in regard to Subsections (2) and (3). If I allowed the Committee to believe that, I should be in danger of misleading it. "—[OFFIEIAL REPORT, 5th December, 1929; col. 2641, vol. 232.] It is my business to stand up for him, because we lawyers, irrespective of party, must all hang together. At that time the right hon. Gentleman was pressed by his Front Bench, by his Government, and of course he had to say what he did. Therefore we were not surprised when certain eventualities happened and we found him saying something quite different on the following Thursday. He said on that occasion: I do not make the smallest apology for having had the wisdom and good sense and courage to give effect to my second thoughts. If we are not to be influenced by what is said in the course of the Debate, then debate becomes a mere formality."—[OFFICIAL REPORT, 12th December, 1929; col. 726, Vol. 233.] But had he been influenced by what was said in the Debate? He showed no signs of it on the previous Thursday. He fell back upon the collective wisdom of the House. We on this side are growing accustomed to know that the collective wisdom of the House means the pressure brought on right hon. Gentlemen opposite by the hon. Member for Bridgeton. I do not blame the Attorney-General. He was speaking not merely for his Government, but for his party—for the whole united party. He was holding a magnificent brief and he argued it splendidly, and I think he ill deserves attacks by the Secretary of State for Scotland upon his competence or his clarity of mind. I think that sometimes when he sits on those ungrateful benches opposite, he must cast a longing eye back to that small country from which he came—that country which may be regarded as a buffer State, but which, in reality, at this time controls the whole political situation. He may regret leaving it and he may want to return to it, but I think he will find some little difficulty in passing the immigration authorities. I believe that he is regarded in his old party as one who is politically dead and I understand, although I have not been there, that an epitaph to him has been erected in the National Liberal Club inscribed, "Not lost, but gone before." There is no doubt that after this Debate, in spite of the dissensions between the hon. Member for Leith (Mr. E. Brown) and the hon. Member for Bodmin (Mr. Foot) the Liberals will, in a body, follow their hon. and right hon. Friends of the party opposite into the Lobby, because we know, as the prophet said: The ox knoweth his owner, and the ass his master's crib.

Major, ELLIOT

After the intervention of my hon. Friend who has just sat down the House will not be disposed to think lightly of lawyers or to regret their contributions to our discussion. [Interruption.] We have not all had the honour of being High Commissioner for the King to the Church of Scotland and it is well known that the corps to which my hon. Friend belongs is colloquially known as "The Devil's Own." But if the House will allow me I will depart from the controversy between those skilled and analytical intellects, the lawyers of the House of Commons. We have had speeches from the Attorney-General of which one could only say that they were too convincing; they succeeded in making a perfect case on the one side, and, a week later, an even more convincing case on the other side. It is to the wider issues which have emerged from the long Debates on this subject that we should address ourselves in the closing stages of the discussion. The points which have emerged from the consideration of this Bill are all of secondary importance compared with the main one, that there is a fundamental difference of opinion as to the objects of this Bill between the Chancellor of the Exchequer and his hon. Friend the Member for Bridgeton (Mr. Maxton). It is a perilous situation because the House is not getting clear guidance and does not know where it is going. First one rein of the horse is pulled, arid then the other, and there is not that clear direction for which the House would look to the Government Benches at this moment of all others.

The House of Commons was assured only to-night by the right hon. Gentleman the Chancellor of the Exchequer that the purpose of this Bill is to vote the fund into a state of solvency. I took down his words, and I have no doubt that those words express the intention with which he has scrutinised his actions and with which he has acquiesced in the expenditure of the sums of money which he has sanctioned in the final stages of this Bill. But that is not the purpose of the hon. Member for Bridgeton, nor the purpose of the hon. Members who sit and vote with him, nor the purpose of that powerful organisation in the Liberal party which offers to circularise them with yet more circulars and books and information. Surely, if the soul of a party could be saved by paper, the Liberal party's soul has been put beyond the range of damnation. The hon. Member's function was to bring it home to the Chancellor of the Exchequer that the purpose of this Bill was not to vote the fund into a Slate of solvency, but to vote the unemployed man into a state of solvency.

Mr. HOFFMAN

Hear, hear!

Major ELLIOT

Of course, the hon. Member for Central Sheffield (Mr. Hoffman), undismayed even by the rebuke of Mr. Speaker, comes chiming in; at any rate, he is opposed to the Chancellor of the Exchequer, whoever else is agreed with him. The purpose of these two sections is fundamentally different, because the Chancellor of the Exchequer's object is to stop the leaks in the fund, but the hon. Member for Bridgeton's purpose is to increase the leaks in the fund. The hon. Member for Bridgeton has put before himself and his organisation the simple object of raising the consuming power of the masses of this country by the process of voting to them larger and larger sums of public money, and he is honestly convinced that by doing that all our difficulties will be swept away. He says there is no need for finding overseas markets, that the markets are at home, that there is no need to develop our trade within or without the Empire, and that in the markets in Manchester, in Sheffield, in Glasgow, and in London we have the source of all the trade that is needed. All that is needed is to increase the unemployment benefit, to relax the restrictions on the spending of public money, to pile up the expenditure, and no harm can come or will come to the country from that process. The more money you give to the unemployed, the more they will themselves create the market that this country desires; and in one of those epigrams of which he alone has the secret he says he would enable the unemployed man to eat his way back into a job.

I do not think I have unfairly stated the contention of the hon. Member and those who sit with him, but that is funda mentally opposed to the argument which the right hon. Gentleman the Chancellor of the Exchequer addressed to the House this night, and the danger of the situation is that the Chancellor of the Exchequer is bending and weakening and surrendering to the demands of the hon. Member for Bridgeton and his friends, without in any way acceding to the fundamental thesis upon which those demands are based. That seems to me to be a situation of peril, a situation which this House will have more and more brought home to it in the days which are immediately ahead. The Chancellor of the Exchequer said he was moving, he hoped, towards a state of greater and greater solvency. He said he would refuse to be judged by one year's result of his finance.

Mr. HOFFMAN

Hear, hear!

Major ELLIOT

The hon. Member for Central Sheffield, like a cuckoo clock, comes chiming in. The Chancellor of the Exchequer is making the case that he is gathering together the resources of the nation, that be is husbanding them. He wishes to reduce the floating Debt, to do everything possible to oonserve the national resources, and to promote economy, and by that means to bring the country back—for it is back that he looks, not forward—to the halcyon days when he was in power in 1924 and left the magnificent surplus of which he was so proud to his successor in office, to whom he feels so very little kindliness in any other way. He is willing to inherit money from him, but he cannot credit him with any other merits. Both of these Chancellors of the Exchequer regarded themselves as the watchdogs of the Treasury. They regarded it as their purpose to restrain expenditure. They regarded it as their purpose, if they spent money, to spend it with a grudge and to keep down expenses. The majority of his own party—not merely extremists but mass upon mass of the staid everyday members of the party—regard that as a heresy which they will do their best to root out of the Government and the Front Bench.

If we are to accept the position which the Chancellor lays down, then we can look forward with a certain degree of equanimity to the future of the county. Although heavy burdens are laid upon us, we are chastened for our good. Al- though the Chancellor puts on taxes and levies of this kind, he is doing it to restore the state of the national finances. Our objection is that as fast as he gathers these resources they are scattered to the winds again by members of his own party. Like the web of Penelope, everything that the Chancellor weaves during the day the hon. Member for Bridgeton undoes during the night. Under those conditions, economy was far from the achievements of the household of Penelope, and, when the master of the house finally came back, he found that a sad amount of waste and revelry had taken place during his absence.

I do not wish to follow the Chancellor into the analysis he gave of the National finances. [HON. MEMBERS: "Why not?"] Because I am anxious not to press unduly on the time of the House on the Third Reading of what is, after all, an Unemployment Insurance Bill. If I were to follow the Chancellor into the very wide field into which he ambled, I should want a much longer time, and we know that the right hon. Lady is nearing the conclusion of her long task, and is anxious to come to the end of it, and so am I. The Chancellor failed altogether either to grasp or to answer the contentions which hon. Members have brought against him from this side. Our contention was not in respect of national money which he is pouring into the fund to restore its solvency. Our contention has been that, while he is pouring this money into the fund to restore its solvency, other hon. Members are opening fresh crevices in the fund through which the money is pouring out. The surrender which was made to the back benches of his party opens a new avenue of expenditure which bears both upon the Exchequer and upon the fund.

For the first time, as far as I know, the Minister responsible for the fund comes down and presents an account by the Government Actuary. It says that, if the figures of unemployment remain those upon which the whole of the calculations of this Bill are based—not merely the new Clause 4 but the whole Bill, and not merely hasty calculations which took place on Friday after the Thursday's Debate, but the calculation of five or six months, based on the whole period of (he right hon. Lady's administration—we must realise that the additional ex- penditure is such as will involve an increase in the debt of the fund during the year by upwards of 2,000,000. There is no provision of any kind made to meet that. There is no provision made to increase the borrowing powers nor are fresh contributions asked for, not merely from workmen and employers but from the State. The expenditure to be provided for by the right hon. Gentleman goes to some £14,000,000 over and above what was found in the year before, and, in addition to this expenditure, we are now being asked to put the fund into a new deficit. This is the first time that a Minister responsible has come down and said, "Vote me a deficit which I see no way to meet."

We shall pass from the Third Reading of this Bill to-night to the first of the new Supplementary Estimates, that for £3,500,000 for the Ministry of Labour. We were assured by the Prime Minister that that might or might not carry us on until we meet again in January, that it might or might not suffice the Fund, that it would be necessary for yet further sums of public money to be voted into this Fund; and, however we took it, if the figure of 1,200,000 people unemployed holds—and these are the figures given, not by us, but by the Government Actuary—the debt on the Fund will have risen by £2,000,000 during the year, and it will be necessary either to increase the floating debt, or to borrow more money, or raise the contributions, or to declare that the Fund is bankrupt and cannot. pay the benefits which it is proposed that it should pay.

These trust funds are matters which it is very necessary for the House to regard closely. There are, for example, two trust funds, with one of which I was closely connected, which were raised last year on behalf of the miners in England and Scotland. The trustees of the Scottish fund paid a more lavish scale of benefits. I was one of the trustees on behalf of the Government contribution. The miners, who were after all the main beneficiaries, asked for an increase in the scale; they said the money was there, and asked for a greater distribution of benefits. We did our best to point out that money was slowly gathered and quickly scattered. In May, the last Government went out of Office and the new Govern- ment came in. All through the summer the distribution from the Fund proceeded at the increased rate. The English fund was more sparingly used and more jealously guarded. I put a question to the responsible Minister for the English fund a week or two ago, and his answer was that there is money in that fund to carry through the winter; the distribution can still proceed, and the same benefits can be maintained for the people who are in dire necessity in the black spots in the distressed coal-mining areas. I put the same question to the Secretary of State for Scotland, and the answer was that the Scottish fund is nearly exhausted; a small sum of £10,000 has been found in the balance, and, when that has gone, there will be no more for the miners in the distressed areas of Scotland, who this winter will have to face a black winter without any assistance. The money was distributed during the summer in higher benefits, while in England it was guarded and still remained to help the English miners through the winter. [An HON. MEMBER: "What has that to do with this Bill?"] That is an example of two trust funds within our own experience, one of which was rapidly spent, and one of which was p reserved.

Mr. MAXTON

A little further back when the contributors to the National Health Insurance Fund piled up a surplus, the hon. and gallant Gentleman's Government, with his approval and support, raided it.

11.0 p.m.

Major ELLIOT

The hon. Member is in complete error. I remember the occasion of that Debate. He has been led away by the propaganda leaflets of his own party. He ought to know how unwise it is to bring such leaflets on to the Floor of the House. No raid was made upon the funds. The Treasury under issued a certain amount of the money which in future would be attracted to these funds by the increased amounts of money which were being piled up; but there was no raid whatever on the funds. If anybody wishes for confirmation of that, let him ask the Under-Secretary of State for Scotland, my successor, or the Minister of Health, who, I regret to see, is not in his place. The lesson of the rash use of these funds has been strikingly brought home to us by that single example. The trust fund which was raised for the benefit of the distressed people in the black spots of the country will not be available this winter in the case of one set of people, the Scottish miners, while it will be available for the English miners. Therefore, distress will bear more harshly on the northern kingdom than on the southern kingdom. It is a lesson which we ought to remember when, as here, we are asked—

Mr. HARDIE

Does the hon. and gallant Member say that in the distribution of those funds there was any waste?

Major ELLIOT

Surely the point which the hon. Member raises is exactly the point which the House is asked to determine. We were asked to spend money without knowing where more money was coming from, just as here, on the report of the Government actuary, we are asked to- spend money out of the Insurance Fund which will run it into a deficit of £2,000,000 in the coming year—that is, on the figures which the Government actuary was given by the Ministry of Labour—without knowing where that £2,000,000 is coming from, The Chancellor of the Exchequer said, "I am not to be judged on a twelve months analysis of my financial administration," but the actuary is concerned with the twelve months immediately in front of him. It is not one year ahead or two years ahead or three years ahead when these deficits to which the Chancellor of the Exchequer looks forward are going to accumulate on his head. That is not what the actuary is looking to. He is looking to the administration of the Fund, on which he has been asked to report, and he has to look at it over the next twelve calendar months, during which this drain falls upon it. He says: During that time a drain greater than the income will arrive upon this fund, and I see no means whatever of meeting that drain. The right hon. Lady said in defence of her case that it was unreasonable to suppose that all these things would fully materialise. She said we had not counted what might take place on the credit side. She said there may be a revival in trade. All one can say is that this must have been present to the minds of the responsible officials when they drew up the estimate of 1,200,000 people out of work, and it was upon these figures that the Govern- ment actuary drew up the Report which the House has had represented to it only within the current week.

With regard to Clause 4, a great hole was knocked in the bottom of the Fund by the right hon. Lady when she accepted the decision of Thursday's Debate. Convincing as the speeches of the Chancellor of the Exchequer and the Attorney-General and the speech of the right hon. Lady in introducing the Bill may have been, they cannot get outside the report which was presented upon, their own proposals, and they stand convicted of one of the most arrant incompetence and of a surrender which it is difficult to characterise as anything but abject when those proposals were presented to the House. Their own report says that while 65,000 persons were brought in by the original proposal another 80,000 or 90,000 were brought in by the new Clause 4. Under these circumstances what becomes of the fine -speeches which were made by the Attorney-General and others on the Treasury Bench defending the original Clause 4, knowing that it was going to strike 90,000 persons off benefit whom they afterwards decided should be added. Here was a mistake of 90,000 out of 150,000. Was that an error or did they know that their proposal would strike off 90,000 and they afterwards gave way to the hon. Member for Bridgeton (Mr. Maxton) and his friends on this point. That is a fundamental difficulty which the Chancellor of the Exchequer has failed to explain.

Did the Government know, in the first place, that 90,000 persons would be struck off by the original Clause 4, and why did hey determine to strike them off? If the Government thought their original proposal was just, why did they add another 90,000 to the register? That is a question which the House has a right to ask and demand an answer. The Chancellor of the Exchequer says that these contributions of public money are necessary to put the fund into a state of solvency. I will refer the right hon. Gentleman to his own White Paper, which says that the annual cost will be between £4,000,000 and £4,500,000 a year. Did the right hon. Gentleman suppose when he made that statement that he was saving that sum at the expense of those whom he afterwards said should be placed on benefit? Does the Chancellor of the Exchequer now admit that he is spending £4,500,000 which is being improperly given to those who should not be on benefit? One or other of those two things must be true. Does the right hon. Gentleman now admit that he was in error to the extent of 90,000 or £4,500,000, and that he was an unfaithful prophet to that extent? The Chancellor of the Exchequer says that he was approached for another £5,000,000 and another £12,000,000 for other purposes which he could not meet. I think some of those purposes might reasonably have been held to be quite as pressing as the Bill we are considering. Was that summing up of our national needs taken coolly and calmly in a way in which our national finances should be considered? The granting of 2s. for a child was described as an insult to our species, but even that was condoned by the Chancellor of the Exchequer and put on the Statute Book. Clause 4 contained the greatest evil in the Bill, and all the other evils had to go by the board. The Chancellor of the Exchequer went upstairs and said, "You must not press me any more; the box is empty, the Treasury is bare, and I cannot find you any more money."

Then we had the extraordinary position of the right hon. Gentleman coming down to the House and defending himself because of his firmness, of the hon. Member for Bridgeton, that gallant highwayman, galloping up to the Treasury windows, thrusting his pistol through, and saying, "Your money or your life!" The Chancellor of the Exchequer comes out and says, "I will take a firm stand; here is my money, but I refuse to give you my life." He has done more; he has, by turning out his pockets, convinced the highwayman that he has no more money at present, and that he must be left to go and gather some further loot.

The discussion is not between me and the Chancellor of the Exchequer, or between us on this side of the House and and the Chancellor of the Exchequer. The right hon. Gentleman represents the old order of things, and he will not very much longer be there in power. The discussion of the future is between myself and those who sit on this side of the House, and the back-benchers on the other side. The discussion is with the younger rising force that we see there. It will before very long overthrow the old men, whom it is already embarrassing. Some day or other the great Debate has to be broached on the Floor of this House and threshed out to its end; and it will be all the less easy to resolve as long as we have this smoke-screen put up by the so-called Iron Chancellor that he is restoring the national finances to a state of solvency.

That is not the argument that is really the driving force of his party; that is not the argument that it put in the back streets; that is not the argument that is responsible for their great majorities in the industrial cities of this country. The arguments which have been put there are the arguments from the back benches, and those are the arguments which this House as a whole will have to meet and grapple with some day. That great cause will require discussion and determination in this House, and sooner or later this House will need to make up its mind upon it. The experiment, for it is nothing more, that is being tried in this Bill will fail, and everybody knows that it will fail; and a new demand will come to this House, a new demand which will need to be resisted, at some time or other, in this House. This House is no fit trustee for public funds unless it clearly understands that there is a strong, determined and growing section which says that the business of the trustee is not to keep these funds, but to squander them. Until the House is fully seized of that position, until the House realises that behind this pasteboard facade of a respectable Government there is the real driving force of a determined effort to change fundamentally the whole basis of society in this country—[Interruption]—and to do it through the engine of taxation and through that great and powerful Department of which the Chancellor of the Exchequer is nominally in control—until the House faces up to that great issue, there will be no reality in politics in this country.

Our only objection to the Debates upon these subjects is that those Debates have not approached the fundamental division of opinion which does truly exist. When that Debate comes, then this House will be crowded, then the papers will take an interest in the Debate, then the country will take an interest in the Debate. Until the time when that Debate is broached, and the interest of the country and of the House is focussed here on the Floor of this House, this Bill might as well pass as another, for all these Bills are fundamentally unreal, and will need to be swept into a wastepaper-basket within the next 12 months—aye, and this one will be swept away sooner even than that.

Miss BONDFIELD

I am sure the House has enjoyed the spectacle of the hon. and gallant Gentleman enjoying his flight of imagination. Let me conic back to a few plain facts. The hon. and gallant Gentleman referred particularly, and at very great length, to the question of the actuary's report. On not one, but on several occasions this report—I am referring to the Memorandum on the financial effect of certain Amendments—has been misquoted in a way that it is very difficult to understand. The basis of the figures supplied to the actuary is perfectly well known to hon. Members opposite. The actuary is presented with what the Ministry of Labour regards as a possible figure at which the unemployment register may keep. Every successive Government has had to make a guess at what that figure is likely to be. No one could possibly tell beforehand with exactitude the average for the next 12 months, but I happen to have the figures of what the averages have been and how they have been dealt with in the financial estimates of the late Government. I want to give two groups of figures, because really they are an effective reply to the criticism we have just heard, the total figures I have here for a very long period showing the live register in relation to the debt. I only propose to take comparable figures. On 31st December, 1927, the live register stood at 1,336,303 persons. The figure for 30th June, 1928, ran down to 1,192,564. On 31st December, 1928, it rose again to 1,520,730. In June, 1929, it went down again to 1,117,800. On 30th November, 1929, it rose again to 1,285,500. Undoubtedly there will be a further increase but it has not yet reached within measurable distance of the 1,520,000 which were the figures at the end of last year.

Let us compare that with the financial provision that the last Government made to meet a situation like that. After the 1925 Act the balancing point of the fund was 1,200,000. By that I mean the measure of provision made to meet the possible average register. The Economy Act of 1926 left a balancing point of 1,050,000. After the Act of 1927 the balancing point had dropped to 1,000,000, and that was the figure at which it remained when I came into office, a balancing point of 1,000,000 in a year when the December figure went up to 1,500,000. The inevitable result of arranging the finances at that balancing point was to increase the deficit of the fund, and they did so increase that deficit year by year. I have gone into the matter of the 1926 deficit referred to by an hon. Member on the back benches. We analysed that in 1926, and allowing that the dispute of that year was entirely responsible for the deficit it still leaves—[HON. MEMBERS: "Hear, hear!"] I was assuming, I do not admit it; we will assume that for the moment. Making the whole allowance for the total cost of that, had the finances of the fund remained as they were in 1924, and had they not. been interfered with, by the subsequent can-Se to which I have just referred, the deficit on the fund to-day would have been £20,000,000 and not £38,000,000. The balancing point of the July, 1929, Act, which went through the House with general consent, was raised from 1,000,000 to 1,090,000, but I informed the House at the time that this was merely a measure of protection to make quite certain that we should not overstep the £40,000,000 debt which was the limit up to the end of December.

It was a precautionary measure, and we informed the House at that time that it was obviously not enough to carry us over the financial year; that we should have to conic before the House with fresh proposals. When the present Bill passes, the balancing point of the fund will have been raised to 1,160,000, 160,000 mare than the balancing point when I came into office. The fund has been relieved of all liability for the transitional payments. The transitional payments will be made from the direct Treasury grant to which the Chancellor of the Exchequer referred. I wish to point out to the House, and I think it is most essential that the House should realise the importance of this provision in the Bill. For the first time since the transitional idea was introduced in the 1927 Bill, for the first time since the decision was made clear with regard to the 30 stamp boundary line, an attempt is being made to restrict payments from that fund to that boundary line. We are saying that there will be debited against the fund only those charges for persons who have got the 30 weeks working period, and for the first time we have been able to present to the House a statement showing exactly what is that proportion of lives unable owing to the present economic conditions to get 15 weeks' work in a year. We shall be able to see the extent of the employability in that group. I would beg the House to remember this side of the question, that it is an infinitely sounder balance sheet than any other balance sheet on this subject for the last five years. I beg of the House to realise that what is in the Bill is only part of the operation which is now going on. Hon. Members have referred to Clause 4. When I introduced my original Clause 4, I said quite frankly to the House that I was not satisfied with the wording, and that I had done my best to construe into the Clause what I believed was possible, and what I thought would have the result of doing away with the not genuinely seeking work hardship, against which the whole House protested with such indignation. I am not ashamed of the sentence which I used on that occasion and I am glad that I used it. It was, that I desired to commit this Clause to the collective wisdom of the House.

I meant that sincerely and without any reserve whatever. I was not satisfied with the Clause and I told the House so. I told the House of the difficulties and the House has given me the benefit of its advice. I want to promise the House that as far as the Department is concerned it will take this Clause in the spirit in which the House passes it and will endeavour to apply it to restore what has been allowed to fall into disuse. Perhaps the word "disuse" is a wrong one to use, and I will say that it will be our endeavour to restore what has been overlaid by the operation of paying out benefit, namely, the work-finding side of the machine. That side has been buried. This Clause will give an impetus to that machinery. We will endeavour at least to restore the original function of the Exchanges, to ensure that the function of the Exchanges shall be the provision of work, canvassing for work, which was originally intended to be their purpose when the Act of 1909 was passed.

The only other point is the question of the spirit of insurance, which has been referred to on more than one occasion. I want to echo what some hon. Members have said. I do believe that in normal circumstances it will be possible to take care of that group which we call the unemployed by means of the insurance principle and by means of contributions to the Fund; but we are still in the backwash of a terrible catastrophe. We are still in the throes of the transitional period in our industrial life. We have to-day an industrial revolution going on; a revolution of new forms; new conditions, which are taking away from millions of men the sort of hereditary channel through which they normally got their work. These have been swept away by changes over which no party, no political ideas have had the slightest control. Great economic forces, the development of science, the development of new ideas applied to industry in other parts of the world have to some extent interfered with our unchallenged position in the international world of trade and commerce. To-day this country is facing a crisis in which its future will depend upon the degree to which we have co-operation on the right lines, and in getting employer and employed working together. Are the employers blameless for the mess in which we find ourselves? Have the employers done all that they could to try and bring us round the corner as quickly as possible, instead of wasting time in squabbles between themselves all over old-fashioned shibboleths which are out of date. I ask the House to realise that in this business of trying to develop our economic system there is going to be tragedy on the part of whole generations of men who have spent their lives in industry, who have helped to build up the fortunes of the last generation. These men are amongst the most terrible tragedies which confront us; the most pathetic spectacles. Employers do not want to employ them. They do not want to go to the work-house; they hate the workhouse, and it is the business of this House to try to help them to maintain their self-respect by coming to their assistance in the way that we are doing in this Bill.

I ask the House to give me the Third Reading of this Bill. I ask the House to realise that in what I have said I am quite sincere. I ask those representatives for Divisions in areas where the distress black spots are, where the festering sores are most manifest, to help us in reorganising the Exchange system in those areas, to try to get co-operation

between the employers, the workers, the three-fold contributors. I have faith to believe that we can make this scheme work to the advantage of the whole community.

Question put, "That the words proposed to be left out stand part of the Question."

The House divided: Ayes, 273; Noes, 199.

Division No. 105.]	AYES.	[11.31 p.m.
Adamson, Rt. Hon. W. (Fife, West)	Freeman, Peter	Lloyd, C. Ellis
Adamson, W. M. (Staff., Cannock)	Gardner, B. W. (West Ham, Upton)	Longbottom, A. W.
Altchison, Rt. Hon. Craigle M.	Gardner, J. P. (Hammersmith, N.)	Longden, F.
Alexander, Rt. Hon. A. V. (Hillsbro')	George, Major G. Lloyd (Pembroke)	Lovat-Fraser, J. A.
Alpass, J. H.	Gibbins, Joseph	Lunn, William
Ammon, Charles George	Gill, T. H.	Macdonald, Gordon (Ince)
Angell, Norman	Gillett, George M.	MacDonald, Rt. Hon. J. R. (Seaham)
Arnott, John	Glassey, A. E.	McElwee, A.
Aske, Sir Robert	Gosling, Harry	McEntee, V. L.
Attlee, Clement Richard	Gossling, A. G.	McKinlay, A.
Ayles, Walter	Gould, F.	MacLaren, Andrew
Baldwin, Oliver (Dudley)	Granville, E.	McShane, John James
Barnes, Alfred John	Greenwood, Rt. Hon. A. (Colne)	Malone, C. L'Estrange (N'thampton)
Beckett, John (Camberwell, Peckham)	Grenfell, D, R. (Glamorgan)	Mander, Geoffrey le M.
Bellamy, Albert	Griffith, F. Kingsley (Middlesbro' W.)	Mansfield, W.
Benn, Rt. Hon. Wedgwood	Griffiths, T. (Monmouth, Pontypool)	Marcus, M.
Bennett, Capt. E. N. (Cardiff, Central)	Groves, Thomas E.	Markham, S. F.
Bennett, William (Battersea, South)	Grundy, Thomas W.	Marley, J.
Benson, G.	Hall, F. (York, W. R., Normanton)	Matters, L. W.
Bentham, Dr. Ethel	Hall, G. H. (Merthyr Tydvil)	Maxton, James
Bevan, Aneurin (Ebbw Vale)	Hall, Capt. W. P. (Portsmouth, C.)	Melville, Sir James
Birkett, W. Norman	Hamilton, Mary Agnes (Blackburn)	Messer, Fred
Bondfield, Rt. Hon. Margaret	Hardie, George D.	Middleton, G.
Bowen, J. W.	Harris, Percy A.	Millar, J. D.
Bowerman, Rt. Hon. Charles W.	Hartshorn, Rt. Hon. Vernon	Mills, J. E.
Broad, Francis Alfred	Hastings, Dr. Somerville	Milner, J.
Brockway, A. Fenner	Haycock, A. W.	Montague, Frederick
Bromfield, William	Hayday, Arthur	Morgan, Dr. H. B.
Bromley, J.	Hayes, John Henry	Morley, Ralph
Brothers, M.	Henderson, Right Hon. A. (Burnley)	Morrison, Herbert (Hackney, South)
Brown, C. W. E. (Notts, Mansfield)	Henderson, Arthur, Junr. (Cardiff, S.)	Morrison, Robert C. (Tottenham, N.)
Brown, Ernest (Leith)	Henderson, Thomas (Glasgow)	Mort, D. L.
Brown, James (Ayr and Bute)	Henderson, W. W. (Mlddx., Enfield)	Moses, J. J. H.
Brown, W. J. (Wolverhampton, West)	Herriotts, J.	Mosley, Lady C. (Stoke-on-Trent)
Burgess, F. G.	Hirst, G. H. (York W. R. Wentworth)	Mosley, Sir Oswald (Smethwick)
Burgin, Dr. E. L.	Hoffman, P. C.	Muggeridge, H. T.
Caine, Derwent Hall-	Hollins, A.	Murnin, Hugh
Cameron, A. G.	Hopkin, Daniel	Nathan, Major H. L.
Cape, Thomas	Hore-Belisha, Leslie.	Naylor, T. E.
Carter, W. (St. Pancras, S. W.)	Horrabin, J, F.	Newman, Sir R. H. S. D. L. (Exeter)
Charleton, H. C.	Hudson, James H. (Huddersfield)	Noel Baker, P. J.
Chater, Daniel	Hunter, Dr. Joseph	Oldfield, J. R.
Church, Major A. G.	Isaacs, George	Oliver, George Harold (Ilkeston)
Clarke, J. S.	Jenkins, W. (Glamorgan, Neath)	Oliver, P. M. (Man., Blackley)
Cocks, Frederick Seymour	John, William (Rhondda, West)	Owen, H. F. (Hereford)
Compton, Joseph	Johnston, Thomas	Palin, John Henry
Daggar, George	Jones, F. Llewellyn- (Flint)	Paling, Wilfrid
Dallas, George	Jowett, Rt. Hon. F. W.	Palmer, E. T.
Dalton, Hugh	Jowitt, Rt. Hon. Sir W. A.	Perry, S. F.
Davies, E. C. (Montgomery)	Kedward, R. M. (Kent, Ashford)	Peters, Dr. Sidney John
Davies, Rhys John (Westhoughton)	Kelly, W. T.	Pethick-Lawrence, F. W.
Day, Harry	Kennedy, Thomas	Phillips, Dr. Marlon
Denman, Hon. R. D.	Kinley, J.	Picton-Turbervill, Edith
Devlin, Joseph	Lang, Gordon	Ponsonby, Arthur
Dickson, T.	Lathan, G.	Potts, John S.
Dudgeon, Major C. R.	Law, Albert (Bolton)	Price, M. P.
Dukes, C.	Law, A. (Rosendale)	Pybus, Percy John
Duncan, Charles	Lawrence, Susan	Quibell, D. J. K.
Ede, James Chuter	Lawrie, Hugh Hartley (Stalybridge)	Ramsay, T. B. Wilson
Edge, Sir William	Lawson, John James	Rathbone, Eleanor
Edmunds, J. E.	Lawther, W. (Barnard Castle)	Raynes, W. R.
Edwards, E. (Morpeth)	Leach, W.	Richards, R.
Egan, W. H.	Lee, Frank (Derby, N. E.)	Richardson, R. (Houghton-le-Spring)
Elmley, Viscount	Lee, Jennie (Lanark, Northern)	Riley, Ben (Dewsbury)
Evans, Capt. Ernest (Welsh Univer.)	Lees, J.	Riley, F. F. (Stockton-on-Tees)
Forgan, Dr. Robert	Lewis, T. (Southampton)	Ritson, J.
Roberts, Rt. Hon. F. O. (W. Bromwich)	Smith, Frank (Nuneaton)	Vaughan, D. J.
Romeril, H. G.	Smith, H. B. Lees (Keighley)	Viant, S. P.
Rosbotham, D. S. T.	Smith, Rennie (Penistone)	Walker, J.
Rowson, Guy	Smith, Tom (Pontefract)	Wallace, H. W.
Salter, Dr. Alfred	Snowden, Rt. Hon. Philip	Watkins, F. C.
Samuel, Rt. Hon. Sir H. (Darwen)	Snowden, Thomas (Accrington)	Watson, W. M. (Dunfermline).
Samuel, H. W. (Swansea, West)	Sorensen, R.	Wellock, Wilfred
Sanders, W. S.	Spero, Dr. G. E.	Welsh, James (Paisley)
Sandham, E.	Stamford, Thomas W.	Welsh, James C. (Coatbridge)
Sawyer, G. F.	Stephen, Campbell	West, F. R.
Scrymgeour, E.	Stewart, J. (St. Rollox)	Westwood, Joseph
Scurr, John	Strachey, E. J. St. Loe	Whiteley, Wilfrid (Birm., Ladywood)
Sexton, James	Strauss, G. R.	Whiteley, William (Blaydon)
Shaw, Rt. Hon. Thomas (Preston)	Sullivan, J.	Williams Dr. J. H. (Llanelly)
Shepherd, Arthur Lewis	Sutton, J. E.	Williams, T. (York, Don Valley)
Sherwood, G. H.	Taylor, R. A. (Lincoln)	Wilson, C. H. (Sheffield, Attercliffe)
Shield, George William	Taylor, W. B. (Norfolk, S. W.)	Wilson, J. (Oldham)
Shiels, Dr. Drummond	Thomas, Rt. Hon. J. H. (Derby)	Wilson, R. J. (Jarrow)
Shillaker, J. F.	Thorne, W. (West Ham, Plaistow)	Winterton, G. E.(Leicester, Loughb'gh)
Shinwell, E.	Thurtle, Ernest	Wise, E. F.
Simmons, C. J.	Tillett, Ben	Wood, Major McKenzie (Banff)
Simon, E. D. (Manch'ter, Withington)	Tinker, John Joseph	Wright, W. (Ruthergien)
Sinkinson, George	Tout, W. J.	Young, R. S. (Islington, North)
Sitch, Charles H.	Townend, A. E.
Smith, Alfred (Sunderland)	Trevelyan, Rt. Hon. Sir Charles	TELLERS FOR THE AYES—
Smith, Ben (Bermondsey, Rotherhithe)	Turner, B.	Mr. Allen Parkinson and Mr. Charles Edwards.
NOES.
Acland-Troyte, Lieut.-Colonel	Crichton-Stuart, Lord C.	King, Commodore Rt. Hon. Henry D.
Albery, Irving James	Croft, Brigadier-General Sir H	Knox, Sir Alfred
Alexander, Sir Wm. (Glasgow, Cent'l)	Crookshank, Capt. H. C.	Lamb, Sir J. Q.
Allen, W. E. D. (Belfast, W.)	Croom-Johnson, R. P.	Lane Fox, Col. Rt. Hon. George R.
Amery, Rt. Hon. Leopold C. M. S.	Culverwell, C. T. (Bristol, West)	Leigh, Sir John (Clapham)
Ashley, Lt.-Col. Rt. Hon. Wilfrid W.	Cunliffe-Lister, Rt. Hon. Sir Philip	Leighton, Major B. E. P.
Astor, Maj. Hn. John J. (Kent, Dover)	Dalkeith, Earl of	Lewis, Oswald (Colchester)
Astor, Viscountess	Dairymple-White, Lt.-Col. Sir Godfrey	Llewellin, Major J. J.
Atholl, Duchess of	Davidson, Rt. Hon. J. (Hertford)	Locker-Lampson, Rt. Hon. Godfrey
Atkinson, C.	Davies, Maj. Geo. F.(Somerset, Yeovil)	Long, Major Eric
Baillie-Hamilton, Hon. Charles W.	Davison, Sir W. H. (Kensington, S.)	Lymington, Viscount
Baldwin, Rt. Hon. Stanley (Bewdley)	Dawson, Sir Philip	Macdonald, Capt. P. D. (I. of W.)
Balfour, George (Hampstead)	Dixey, A. C.	Macquisten, F. A.
Balfour, Captain H. H. (I. of Thanet)	Duckworth, G. A. V.	Maitland, A. (Kent, Faversham)
Balniel, Lord	Dugdale, Capt. T. L.	Makins, Brigadier-General E.
Beamish, Rear-Admiral T. P. H.	Eden, Captain Anthony	Margesson, Captain H. D.
Beaumont M. W.	Edmondson, Major A. J.	Marjoribanks, E. C.
Bellairs, Commander Carlyon	Elliot, Major Walter E.	Mason, Colonel Glyn K.
Berry, Sir George	Erskine, Lord (Somerset, Weston-s. M.)	Meller, R. J.
Bevan, S. J. (Holborn)	Everard, W. Lindsay	Mitchell, Sir W. Lane (Streatham)
Birchall, Major Sir John Dearman	Falle, Sir Bertram G.	Mitchell-Thomson, Rt. Hon. Sir W.
Bird, Ernest Roy	Ferguson, Sir John	Mond, Hon. Henry
Boothby, R. J. G.	Fermoy, Lord	Moore, Sir Newton J. (Richmond)
Bourne, Captain Robert Croft	Fielden, E. B.	Moore, Lieut.-Colonel T. C. R. (Ayr)
Bowater, Col. Sir T. Vansittart	Fison, F. G. Clavering	Morrison, W, S. (Glos., Cirencester)
Bowyer, Captain Sir George E. W.	Ford, Sir P. J.	Morrison-Bell, Sir Arthur Clive
Boyce, H. L.	Forestier-Walker, Sir L.	Muirhead, A. J.
Bracken, B.	Fremantle, Lieut.-Colonel Francis E.	Newton, Sir D. G. C. (Cambridge)
Braithwaite, Major A. N.	Galbraith, J. F. W.	Nicholson, O. (Westminster)
Brass, Captain Sir William	Ganzoni, Sir John	Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)
Briscoe, Richard Georqe	Gault, Lieut.-Col. Andrew Hamilton	Oman, Sir Charles William C.
Brown, Col. D. C. (N'th'I'd., Hexham)	Glyn, Major R. G. C.	O'Neill, Sir H.
Brown. Briq.-Gen. H. C. (Berks, Ncwb'y)	Grace, John	Ormsby-Gore, Rt. Hon. William
Bullock, Captain Malcolm	Graham, Fergus (Cumberland, N.)	Peake, Capt. Osbert
Burton, Colonel H. W.	Greaves-Lord, Sir Walter	Penny, Sir George
Butler, R. A.	Greene, W. P. Crawford	Percy, Lord Eustace (Hastings)
Butt, Sir Alfred	Gretton, Colonel Rt. Hon. John	Peto, Sir Basil E. (Devon, Barnstaple)
Cadogan. Major Hon. Edward	Gunston, Captain D. W.	Pownall, Sir Assheton
Carver, Major W. H.	Hacking, Rt. Hon. Douglas H.	Purbrick, R.
Castle Stewart, Earl of	Hall, Lieut.-Col. Sir F. (Dulwich)	Ramsbotham, H.
Cayzer, sir C. (Chester, City)	Hamilton, Sir George (Ilford)	Rawson, Sir Cooper
Cayzer, Maj. Sir Herbt. R. (Prtsmth. S.)	Hammersley, S. S.	Reid, David D. (County Down)
Cazalet, Captain Victor A.	Hartington, Marquess of	Remer, John R.
Chadwick, Sir Robert Burton	Harvey, Major S. E. (Devon, Totnes)	Rentoul, Sir Gervais S.
Chamberlain, Rt. Hn. Sir J. A.(Birm., W.)	Henderson, Capt. R. R.(Oxf'd, Henley)	Roberts, Sir Samuel (Ecclesall)
Christie, J. A.	Heneage, Lieut.-Colonel Arthur P.	Rodd, Rt. Hon. Sir James Rennell
Churchill, Rt. Hon. Winston Spencer	Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.	Ross, Major Ronald D.
Cockerill, Brig.-General Sir George	Howard-Bury, Colonel C. K.	Ruggles-Brise, Lieut.-Colonel E. A.
Colfox, Major William Philip	Hudson, Capt. A. U. M. (Hackney, N.)	Russell, Alexander West (Tynemouth)
Colman, N. C. D.	Hurd, Percy A	Salmon, Major I.
Colville, Major D. J.	Iveagh, Countess of	Samuel, A. M. (Surrey, Farnham)
Courtauld, Major J. S.	James, Lieut.-Colonel Hon. Cuthbert	Samuel, Samuel (W'dsworth, Putney)
Courthope, Colonel Sir G. L.	Jones, Sir G. W. H. (Stoke New'gton)	Sandeman, Sir N. Stewart
Cranbourne, Viscount	Kindersley, Major G. M.	Sassoon, Rt. Hon. Sir Philip A. G. D.

Savery, S. S.	Steel-Maitland, Rt. Hon. Sir Arthur	Waterhouse, Captain Charles
Shepperson, Sir Ernest Whittome	Stuart, J. C. (Moray and Nairn)	Wayland, Sir William A.
Skelton, A. N.	Sueter, Rear-Admiral M. F.	Williams, Com. C. (Devon, Torquay)
Smith, Louis w. (Sheffield, Hallam)	Thomas, Major L. B. (King's Norton)	Windsor-Clive, Lieut.-Colonel George
Smith, R. W.(Aberd'n & Kinc'dine, C.)	Tinne, J. A.	Winter-ton, Rt. Hon. Earl
Smith-Carington, Neville W.	Titchfield, Major the Marquess of	Wolmer, Rt. Hon. Viscount
Smithers, Waldron	Tryon, Rt. Hon. George Clement	Womersley, W. J.
Somerset, Thomas	Turton, Robert Hugh	Wood, Rt. Hon. Sir Kingsley
Somerville, A. A. (Windsor)	Vaughan-Morgan, Sir Kenyon	Worthington-Evans, Rt. Hon. Sir L.
Somerville, D. G. (Willesden, East)	Wallace, Capt. D. E. (Hornsey)	Young, Rt. Hon. Sir Hilton
Southby, Commander A. R. J.	Ward, Lieut. Col. Sir A. Lambert
Spender-Clay, Colonel H.	Wardlaw-Milne, J. S.	TELLERS FOR THE NOES.—
Stanley, Maj. Hon. O, (W'morland)	Warrender, Sir Victor	Commander Sir B. Eyres Monsell and Major Sir George Hennessy.

Bill read the Third time, and passed.