Commons Sitting of 22 July 1929

Preamble
The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.
Barmouth Urban District Council Bill,

Clyde Navigation Bill,

Derby Corporation Bill,

Grand Junction Company Bill,

Hendon Urban District Council Bill,

Lords Amendments considered, and agreed to.
Sutton District Waterworks Bill [Lords],
Read the Third time, and passed, without Amendment.
Edmonton Urban District Council Bill,
As amended, considered:—
Ordered,
"That Standing Orders 223 and 243 be suspended, and that the Bill be now read the Third time."—[The Chairman of Ways and Means.]
Bill accordingly read the Third time, and passed.
Birmingham Corporation (General Powers) Bill [Lords],
Tyneside Tramways and Tramroads Company Bill [Lords],
Read a Second time, and committed.
London Electric, Metropolitan District, and City and South London Railway Companies Bill [Lords],
Ordered,
"That, in the case of the London Electric, Metropolitan District, and City and South London Railway Companies Bill [Lords], Standing Orders 84, 214, 215, and 239 be suspended, and that the Bill be now taken into consideration provided amended prints shall have been deposited."—[The Chairman of Ways and Means.]
Bill, as amended, considered accordingly.
Ordered,
"That Standing Orders 223 and 243 be suspended, and that the Bill be now read
878
the Third time."—[The Chairman of Ways and Means.]
King's Consent signified; Bill read the Third time, and passed, with Amendments.
Romford Gas Bill [Lords],
Ordered,
"That, in the case of Romford Gas Bill [Lords], Standing Orders 84, 85, 214, 215, and 239 be suspended, and that the Bill be now taken into consideration provided amended prints shall have been previously deposited."—[The Chairman of Ways and Means.]
Bill, as amended, considered accordingly; Amendments made.
Ordered,
"That Standing Orders 223 and 243 be suspended, and that the Bill be now read the Third time."—[The Chairman of Ways and Means.]
King's Consent signified; Bill read the Third time, and passed, with Amendments.

Ministry of Health Provisional Orders (No. 11) Bill,

Ministry of Health Provisional Orders (No. 12) Bill,

Read the Third time, and passed.

Inverness Water and Gas Order Confirmation Bill [Lords],

Leith Harbour and Docks Order Confirmation Bill [Lords],

London, Midland, and Scottish Railway Order Confirmation Bill [Lords],

Read the Third time, and passed, without Amendment.
Greenock Burgh Order Confirmation Bill,
Considered; read the Third time, and passed.

PETITION.
Brigadier-General CLIFTON BROWN: I beg to present a petition from the inhabitants of Woodley, Sonning, and Earley, the Rural District of Wokingham, the Woodley Labour party, and others, praying this honourable House not to permit the Minister of Health to sanction the erection of an institution for the reception of tramps and vagrants in the midst of their beautiful rural district without a public inquiry.
ORAL ANSWERS TO QUESTIONS.
  INDIA.

    FILMS.
    Mr. DAYasked the Secretary of State for India whether he has received a copy of the Report and conclusions arrived at by the Committee which was appointed by the Governor-General in Council to consider the production and introduction of cinematograph films in India?
    The SECRETARY of STATE for INDIA (Mr. Wedgwood Benn): Yes, Sir. A copy was received by my predecessor and was placed by him in the Library.
    Mr. DAYasked the Secretary of State for India whether ho has any information and can state whether the exhibition of any films has been prohibited in India during the past two years; and, if so, will he give particulars, including the names and titles of such films and the country of their origin?
    Mr. BENN: The censorship of films in India is a matter for the local authorities, and I do not receive reports of the action taken by the Indian Boards of Films Censors in respect of the films submitted to them. I will, however, send to my hon. Friend a list of 47 films, the exhibition of which is known from the information in my possession to have been prohibited during the last two years.
    Mr. DAY: Can my right hon. Friend say the country of origin of the majority of these films?
    Mr. BENN: No. There are six British films only.
    Colonel HOWARD-BURY: Can the right hon. Gentleman say from what country most of these films which were prohibited came? Are there not a great many films which should not be shown at all in India?
    Mr. BENN: I could, of course, prepare a list showing the countries of origin and would willingly do so; but I may say that I have looked through the list, and objection occurred in nearly every case on grounds of ordinary decency and morality.

    MILL STRIKE, BOMBAY.
    Major POLEasked the Secretary of State for India if he will make a statement concerning the present position in regard to the mill strike in Bombay, giving the number of workers affected and information as to the progress made by the court of inquiry set up under the Trade Disputes Act?
    Sir FRANK NELSONasked the Secretary of State for India the present position in Bombay in regard to the stoppage of work in the cotton mills?
    Mr. BENN: The latest information in my possession is that approximately 109,000 men and 64 mills were affected by the strike out of 77 textile mills in Bombay. Out of these 77 mills about 70 are working to-day with approximately 74,000 men. This number includes 46,000 strikers who have resumed work. A preliminary meeting of the Court of Inquiry was held on the 6th July, and has been several times adjourned to secure the attendance of representatives of the Girni Kamgar Union. The terms of reference of the Court were published in the Bombay Gazette Extraordinary of 3rd July, and are briefly: to inquire and ascertain the exact nature of the dispute in the 64 mills, the extent of the respective responsibility of employers or workers, the causes and responsibility for the prolongation of the strike, and the nature of the difficulties in the way of settlement.
    Sir F. NELSON: Is the right hon. Gentleman satisfied that this unfortunate stoppage was purely a trade dispute, and will he assure the House that there were not more sinister reasons behind it?
    Mr. BENN: I think the Government of Bombay have done the right thing in setting up a Court of Inquiry, but I certainly should not be wishful of prejudging whatever their findings may be.

    VIZAGAPATAN HARBOUR.
    Commander OLIVER LOCKER-LAMPSONasked the Secretary of State for India when the Vizagapatan harbour will be opened for shipping; and what further delays are likely?
    Mr. BENN: The latest progress report expresses the hope that the new harbour will be opened for shipping in 1932. Investigation of the dredging problem has

    881
    shown that completion by 1930, the date which had at one time been hoped for, is now out of the question.

    TRIAL, MEERUT.
    Mr. W. J. BROWNasked the Secretary of State for India whether his attention has been drawn to the address on behalf of the prosecution delivered by the Crown prosecutor on the opening day of the magisterial inquiry in the Meerut conspiracy case; whether he will explain why a full report of this address was drawn up and distributed at the expense of the Government of India; if he will say how widely this distribution was made; and whether a full report of the address will be made available for Members of Parliament in the form of a White Paper?
    Mr. BENN: Yes, Sir. In view of the importance of the matter a verbatim note of the prosecuting Counsel's speech was taken and was, I presume, distributed to the Press who received all other facilities for reporting the case: but I have no information as to the extent of the distribution. Until the trial is over it is premature to consider the laying of a White Paper.

    RELEASED PRISONERS, BENGAL.
    Mr. THURTLEasked the Secretary of State for India if it has yet been found necessary to re-arrest any of the released Bengal criminal ordinance prisoners who were detained so long on the ground that their release would involve danger to law and order?
    Mr. BENN: No person has been rearrested under the Bengal Criminal Law (Amendment) Act, but one of the persons released after detention is now under trial at Lahore under the ordinary law.
    Mr. THURTLE: May I take it that the right hon. Gentleman has drawn the obvious moral from the information which he has given to the House, and will not repeat the sins of his predecessors?
    Mr. SPEAKER: That question does not arise.

    OPIUM CONSUMPTION (INQUIRIES).
    Mr. CECIL WILSONasked the Secretary of State for India whether the Committee appointed in July, 1927, to
    882
    examine the position with regard to opium in the Malwa States has presented its Report; whether the Government of India has taken any decisions arising out of that Report; and whether the Report will be published?
    Mr. BENN: The Committee has reported. No decisions have yet been taken. The question of publishing the Report has not yet been considered.
    Mr. WILSONasked the Secretary of State for India whether all the Committees appointed in the Autumn of 1927 by five Provincial Governments to inquire into the high consumption of opium in certain areas have presented their Reports; whether the local Government which arranged to make a similar inquiry has presented its Report; what action the Government of India has taken or proposes to take upon the Reports; when Reports not yet presented may be expected; and whether all the Reports are to be published?
    Mr. BENN: Four of the six inquiries have been completed. As soon as the remaining two are finished the Government of India propose to convene a Conference to collate and compare the results obtained before the Local Governments pass orders. The publication of each Report is a matter for the Local Government concerned. The Bengal Report has been published.

  CHINA.

    ARMS TRAFFIC.
    Mr. DAYasked the Secretary of State for Foreign Affairs whether the British Legation in China have made representations to the British Government during the year 1928, drawing the attention of the British Government to the disregard of the arms embargo; and whether his Department has taken any action?
    The SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Arthur Henderson): No representations were received during 1928 nor action taken beyond that referred to in the reply returned to my hon. Friend on 13th June of last year. I would add that, in view of the changed situation consequent on the conclusion of treaties with and the recognition of the National Government,

    883
    the Arms Embargo Agreement was, by a unanimous agreement of the Diplomatic Body in Peking, cancelled as from 26th April last, on which date this decision was formally communicated to the Chinese Minister for Foreign Affairs.

    EXTRA-TERRITORIALITY.
    Mr. HANNONasked the Secretary of State for Foreign Affairs if he has received any recent communication from the British representative in China on the attitude of the Chinese Government towards the proposals of the Powers on extra-territoriality; and if he can make a statement on the present situation in relation to that question?
    Mr. A. HENDERSON: Proposals in regard to extra-territoriality have been made, not by the Powers, but by China. On 27th April the Chinese Government addressed notes to six Powers, including ourselves, asking for the abolition of extra-territoriality. The reply of His Majesty's. Government is under consideration, and will, I hope, shortly be sent in. I should prefer to defer any statement on the subject till then.

  GREAT BRITAIN AND PORTUGAL.
  Mr. AYLESasked the Secretary of State for Foreign Affairs whether, with reference to the Treaty with Portugal involving military commitments on behalf of this country to maintain the integrity of Portugal and her colonies, he can state what is involved in such an undertaking; and whether, in view of our adherence to the Covenant of the League of Nations, His Majesty's Government will take an early opportunity to terminate the treaty?
  Mr. A. HENDERSON: The obligations derived from the ancient treaties of friendship and alliance with Portugal, all of which have been published, may be described in general terms as an obligation to go to the assistance of Portugal in defence of her territory against external attack. I see nothing in this obligation which is in any way inconsistent with the Covenant of the League of Nations, in the larger obligations of which the obligation towards Portugal may now be regarded as merged. I see, therefore, no reason for wishing to terminate an
  884
  association which has united the two countries in friendship for many hundreds of years.

  TRADE AND COMMERCE.

    BRITISH ECONOMIC MISSION, SOUTH AMERICA.
    Mr. HANNONasked the Secretary of State for Foreign Affairs if he will communicate to the House an outline of the scope of the investigations to be undertaken by the British Economic Mission to South America which leaves this country on 2nd August, and the countries which the mission proposes to visit; and what preliminary arrangements have been made to facilitate the work of the mission?
    Mr. GILLETT (Secretary, Overseas Trade Department): The British Economic Mission to South America has been appointed to consider Anglo-Argentine and Anglo-Brazilian relations, industrial, commercial and financial, with a view to their development in the mutual advantage of the respective countries. The mission is investigating in this country the general aspects of our economic relations with Argentina and Brazil prior to its departure for South America. Preliminary arrangements for facilitating the work of the mission abroad are being made by His Majesty's representatives in the countries to be visited, while the representatives in London of the Governments of those countries are also giving their hearty cooperation. The mission will visit Uruguay in the interval between the visits to Argentina and Brazil.
    Mr. HANNON: Can the hon. Gentleman say whether the Mission will give attention to the extent to which British manufactured goods are now being competed against in South America?
    Mr. GILLETT: I understand that full powers have been given to the Commission to investigate every possible aspect of trade and industry.
    Mr. MATTERS: Will the hon. Member consider the advisability of sending a similar Mission to visit the important West Coast republics, Chili, Peru, Bolivia and Venezuela?

    SAFEGUARDED INDUSTRIES.
    Major THOMASasked the Prime Minister, in view of the proposed abandonment of Safeguarding and pending international agreement as to wages and labour conditions generally, what steps the Government propose to take with a view to maintaining in employment persons who may be displaced from safeguarded industries by the competition of sweated foreign labour.
    The PRIME MINISTER (Mr. J. Ramsay MacDonald): I cannot undertake to answer so hypothetical a question.

    FOREIGN IMPORT DUTIES.
    Mr. HANNONasked the President of the Board of Trade whether it is proposed to address representations to foreign Governments for the reduction or abolition of import duties imposed upon British goods imported into their countries, in view of the intention of His Majesty's Government not to renew the Safeguarding Duties at present in force, thereby facilitating the free importation of foreign manufactured goods into this country?

    With reference to the first part of the question, the following table shows the quantity and declared value of the total imports of condensed milk into the United Kingdom during the years 1927 and 1928. It is understood that the bulk of these imports was in tins.

    Description.

    Quantities.

    Declared Values.

    1927.

    1928.

    1927.

    1928.

    Milk, condensed:

    Cwt.

    Cwt.

    £

    £

    Not sweetened

    …

    …

    …

    411,485

    425,406

    1,159,774

    1,161,655

    Sweetened:

    Whole

    …

    …

    …

    253,272

    297,015

    608,479

    715,100

    Separate or skimmed

    …

    …

    …

    1,854,759

    1,951,025

    3,271,783

    3,372,826

    As regards the second part of the question, I am advised by my right hon. Friend the Minister of Health that there is no difference in nutritive value between imported and British condensed milk of the same description. With regard to the third part, I regret that I have no information as to the comparative prices of imported and British condensed milk of the same description.

  RHINELAND EVACUATION.
  Colonel WEDGWOODasked the Secretary of State for Foreign Affairs whether His Majesty's Government is in any way committed for or against the proposed committee of verification and conciliation which the French Government demand in connection with the evacuation of the Rhineland?
  Mr. GILLETT: No such general representations are in contemplation, but representations respecting the Customs treatment of goods in which this country is specially interested will continue to be addressed to foreign countries whenever it appears desirable to do so.
  Mr. HANNON: Are we to assume that the policy of the Government is to make our market more and more available for foreign commodities while the other markets of the world are being closed against us?

  RHINELAND EVACUATION.

    TINNED MILK (IMPORTS).
    Rear-Admiral SUETERasked the President of the Board of Trade whether he can give the quantity and value of tinned milk imported into this country; whether it contains the same nourishment as similar brands produced in our home factories; and how it compares in price?
    The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. W. R. Smith): The answer in this case also includes a table of figures. The hon. and gallant Member will, therefore, perhaps agree to its circulation in the OFFICIAL REPORT.
    Following is the reply:
    Mr. WISEasked the Secretary of State for Foreign Affairs whether this country is bound by any undertakings given by the late Government to support the French proposal for a continued inter-Allied control of the Rhineland permanently or until 1935 by the establishment of a committee of verification and conciliation?
    Mr. A. HENDERSON: His Majesty's Government, as well as the French, German, Belgian, Italian and Japanese Governments, were committed by a decision taken at Geneva last September to the principle of the proposed commission. The composition, operations, object, and duration of the commission are matters which will form the subject of negotiations: on these points His Majesty's Government have not committed themselves, and do not propose to commit themselves until the Conference meets. My hon. Friend the Member for Leicester, East (Mr. Wise) is, however, mistaken in referring to inter-Allied control; it is the intention that Germany shall be represented on the commission on the same footing as the other Powers interested.
    Colonel WEDGWOOD: Did I understand the right hon. Gentleman to say that this country and Germany were equally committed to this commission? In view of the fact that the German Government have now, obviously, changed their mind on the question, are the British Government still as free as the German Government to change their mind?
    Mr. HENDERSON: I must ask for notice about change of mind.
    Colonel WEDGWOOD: Is not the right hon. Gentleman aware of Herr Stresemann's speech last week?
    Mr. WISE: Can the right hon. Gentleman say whether any negotiations on the details to which he referred have taken place since September last?
    Mr. HENDERSON: Not that I am aware of.
    Dr. MORRIS-JONESasked the Secretary of State for Foreign Affairs whether he has yet received a deputation from a non-party organisation known as the Women's Peace Council; and, if so, whether, in view of the doubt in the minds of the women of this country, as expressed by this deputation, as to whether His Majesty's Government are-prepared to treat the question of the evacuation of the Rhine independently of the question of reparations, he is prepared to make a further statement so as to relieve the anxiety felt in this matter?
    Mr. A. HENDERSON: Yes, Sir; I received a deputation representing the Women's Peace Crusade on Thursday last. I informed them, just as I have on several occasions informed the House, that His Majesty's Government retain complete liberty to withdraw the British troops from the Rhineland if and when it seems expedient to them to do so. To that statement of the position I am afraid I can add nothing.

  RUSSIA.

    DIPLOMATIC RELATIONS.
    Mr. R. A. TAYLORasked the Secretary of State for Foreign Affairs if he has received any reply in response to his invitation to the Russian Government to appoint a responsible representative to visit London; and if he has any statement to make on the matter?
    Mr. SMITHERSasked the Secretary of State for Foreign Affairs if he has received a reply to his communication to the Soviet Government inviting a representative to come to this country; and, if so, can he state the name and official position of such representative and when he will arrive?
    Mr. A. HENDERSON: No reply has yet been received from the Soviet Government, and consequently I have nothing to add to the statement which I made to the House on 15th July. The second part of the question put by the hon. Member for Chislehurst (Mr. Smithers) does not arise.
    Mr. TAYLOR: Does the right hon. Gentleman hope to be able to make a statement on this matter before the House rises?
    Mr. HENDERSON: That will depend upon whether I get any reply.
    Mr. SMITHERS: Are we to understand that the British Government have initiated these negotiations, and that their initiations have bean entirely ignored? Can I have an answer?
    Mr. HENDERSON: The hon. Member presses for an answer. I surely must wait a certain period of time, to give an opportunity to the Soviet Government to decide upon its policy. I have been long enough in this House to know that the British Government sometimes take a long time to make up their mind.

    POLITICAL AND ECONOMIC PROBLEMS.
    Mr. BOOTHBYasked the Secretary of State for Foreign Affairs whether the political and economic problems relating to the Union of Soviet Socialist Republics will be discussed in the forthcoming negotiations between Great Britain and the United States of America?
    Mr. A. HENDERSON: As far as His Majesty's Government are concerned the answer is in the negative.
    Mr. BOOTHBY: Does not the right hon. Gentleman think that the outstanding difficulties between ourselves and Russia are much more likely to be removed if we acted in co-operation with the United States of America?
    Mr. HENDERSON: There is serious objection, as I gather from questions, to our acting in any way in regard to Russia—
    Viscountess ASTOR: Do not break their hearts.
    Mr. HENDERSON: But I am convinced that to mix this question up with the conversations on naval disarmament would not lead to clarification.

    BRITISH TRADE COMMISSION.
    Mr. KELLYasked the Secretary to the Overseas Trade Department whether a report has been presented to his Department as to the result of the work of the committee of business men who recently visited Russia?
    Mr. GILLETT: A statement of the work of the committee of business men who recently visited Russia, signed by the chairman, has been received by my Department. I am informed that the general Report is in course of preparation, and will be issued as soon as possible.
    Mr. KELLY: May I ask when the Report is expected to be presented to the Department?
    Mr. GILLETT: I am afraid that I have no information on that point.

  YUGO-SLAVIA AND BULGARIA (FRONTIER DISPUTE).
  Mr. BEAUMONTasked the Secretary of State for Foreign Affairs whether
  890
  British mediation has been offered in the boundary trouble between Bulgaria and Yugo-Slavia; whether it has been accepted; and, if so, what form it will take?
  Captain CAZALETasked the Secretary of State for Foreign Affairs whether he can give the House any information concerning the recent frontier troubles between the Serbo-Croat-Slovene State and Bulgaria; and whether His Majesty's Government have made any communication to either State on the subject?
  Mr. A. HENDERSON: His Majesty's Government and the French Government are offering friendly advice both at Belgrade and Sofia with a view to facilitate direct negotiations between the Governments concerned.
  Mr. BEAUMONT: Can I have an answer to the second part of the question, whether the communication has been received or not?
  Mr. HENDERSON: There, again, I must wait a little time.

  MALTA.
  Lieut-Commander KENWORTHYasked the Secretary of State for Foreign Affairs whether a note has been handed by His Majesty's Minister to the Vatican with reference to the recent events in Malta; and, if so, what is the nature of the note?
  Mr. A. HENDERSON: If my hon. and gallant Friend is referring to a recently published letter from the Pope to the Bishops of Malta and Gozo denouncing the Maltese Government, the answer is in the negative. Though I can as yet make no statement on the subject, the situation created by the despatch of this letter is receiving careful consideration.
  Lieut.-Commander KENWORTHY: I do not know whether it was due to my faulty wording of the question, but my right hon. Friend has not answered what I endeavoured to ask him. Have we presented a Note to the Vatican on behalf of ourselves?
  Mr. HENDERSON: Not that I am aware of. I read the question the other way.
  Colonel WEDGWOOD: May we take it that His Majesty's Government will support the rights of these responsible Governments to look after their own affairs?

  FRENCH FOREIGN LEGION (BRITISH SUBJECTS).
  Commander O. LOCKER-LAMPSONasked the Secretary of State for Foreign Affairs whether British subjects enrolled in the Foreign Legion in French service lose any rights as British citizens; and what French official channel exists through which communications can be made?
  Mr. A. HENDERSON: The answer to the first part of the question is in the negative. The free enjoyment by British subjects of their rights as such is, however, naturally curtailed during the period of their service under a foreign Government and in a foreign land. The diplomatic channel is open for communications to the French Government relating to legionaries of British nationality, but if the hon. and gallant Member has in mind the question of their release from the Legion I would remind him that my powers of intervention are limited by the fact of such persons having entered into a voluntary contract for a period of five years' service.

  RENUNCIATION OF WAR (TREATY).
  Mr. AYLESasked the Secretary of State for Foreign Affairs whether he will issue a White Paper stating specifically the conditions under which this country would hold itself obliged to enter into war in the light of our adherence to the Multilateral Treaty for the Renunciation of War as modified by the two White Papers, United States, Nos. 1 and 2, of 1928?
  Mr. A. HENDERSON: I will consider the advisability of publishing a White Paper on the lines suggested by my hon. Friend.

  ANGLO-EGYPTIAN RELATIONS.
  Mr. THURTLEasked the Secretary of State for Foreign Affairs when King Fuad of Egypt is expected in this country; and if it is the intention of his Department
  892
  to have conversations with King Fuad regarding the relations between Egypt and this country?
  Mr. A. HENDERSON: King Fuad of Egypt arrived in London on Saturday on a private visit. Having regard to the private nature of the visit, it is not proposed to have conversations with His Majesty regarding the relations between Egypt and this country.

  INTERNATIONAL COURT OF JUSTICE (OPTIONAL CLAUSE).
  Captain EDENasked the Secretary of State for Foreign Affairs whether he is yet in a position to state what reservations, if any, the Government propose to attach to their signature of the Optional Clause?
  Mr. A. HENDERSON: I am not yet in a position to make a statement.
  Captain EDEN: Will the right hon. Gentleman make a statement before the House rises?
  Mr. HENDERSON: Not unless it is on Friday, as there is a Committee sitting on Thursday.
  Captain EDEN: May I ask if we can have an assurance that the Government will not sign this Clause without first enabling the House to discuss the very important question of reservations?
  Mr. HENDERSON: No. I can give no such assurance with regard to signing. The House will have an opportunity to discuss the matter before ratification.
  Captain EDEN: Does the right hon. Gentleman propose to sign without giving the House any power to insist upon adequate reservations?

  FISHING INDUSTRY.

    MORAY FIRTH (FOREIGN TRAWLERS).
    Major WOODasked the Secretary of State for Foreign Affairs whether, in view of the great damage done to fishermen's gear by foreign trawlers in the Moray Firth and other areas from which British trawlers are excluded, he will consider the advisability of having the question brought before the League of Nations?
    The SECRETARY of STATE for SCOTLAND (Mr. William Adamson): I have been asked to reply. As I indicated in my reply to the hon. and gallant Member's question last week, I appreciate the importance of this matter, and the suggestion in the last part of his present question is one of the points which I have undertaken to consider.
    Mr. BOOTHBY: Is the right hon. Gentleman aware that this is a matter which has been reported on by successive Governments for the last ten years, and that nothing has yet been done?

    FISHERMEN and FISHING BOATS in England and Wales on 31st December, 1913 and 1927.

    —

    1913.

    1927.*

    Estimated number of fishermen employed in sea fishing:

    Regularly

    37,870

    30,556

    Occasionally

    7,512

    3,940

    Total

    45,382

    34,496

    HERRINGS (EXPORTS).
    Sir G. RENTOULasked the President of the Board of Trade what was the quantity of herrings, fresh or frozen, exported from the ports of Yarmouth and Lowestoft during the fishing seasons of 1924 to 1928 inclusive?

    STATISTICS.
    Sir GERVAIS RENTOULasked the Minister of Agriculture the number of fishermen, and the number of fishing boats, engaged in the industry round the coasts of Great Britain in 1913 and at the present day?
    The MINISTER of AGRICULTURE (Mr. Noel Buxton): As the reply contains a number of figures, I propose, with the hon. Member's permission, to circulate it in the OFFICIAL REPORT.
    Following is the reply:
    Mr. W. R. SMITH: The answer takes the form of a table of figures; and, with the hon. Members permission, I will circulate it in the OFFICIAL REPORT.
    Following is the reply:

    THE FOLLOWING TABLE shows the quantities of HERRINGS, fresh or frozen, exported from the ports of Yarmouth and Lowestoft, registered in the five months, August to December, 1924 to 1928.

    —

    August to December.

    1924.

    1925.

    1926.

    1927.

    1928.

    Cwts.

    Cwts.

    Cwts.

    Cwts.

    Cwts.

    Exports from the Port of—

    Yarmouth

    …

    117,012

    62,709

    58,286

    47,399

    45,479

    Lowestoft (including Southwold)

    …

    331,210

    609,971

    568,760

    500,227

    511,308

  CHINA AND RUSSIA.
  Captain EDENasked the Secretary of State for Foreign Affairs whether he has any information as to the present state of diplomatic relations between the Soviet Government of Russia and the Chinese Government?
  Mr. A. HENDERSON: I am informed that the State Council at Nanking decided on the 20th instant to break off all relations with the Union of Soviet Socialist Republics, to withdraw all Chinese diplomatic officers from Russia, to request all Soviet diplomatic officers to leave China and to place all Chinese nationals in Russia under the care of the German Ambassador at Moscow. I understand that the Soviet Government had previously informed the Chinese Minister at Moscow (on the 17th instant) that they are breaking off all diplomatic relations with China.
  Captain EDEN: Have the Government made any representations either separately or in conjunction with other Powers to either of the two parties concerned?
  Mr. HENDERSON: Yes. As a result of a communication which we received from the United States Government on Saturday, we sent an intimation both to the United States Government and the French Government, and we associate ourselves with them in all the efforts they are making to secure a pacific settlement.
  Brigadier-General Sir HENRY CROFT: May I ask the right hon. Gentleman whether he will give an undertaking that there will be no closer diplomatic relations with either of these Powers until he is certain that the Kellogg Pact has not been violated?
  Mr. HENDERSON: For me to give an undertaking like that, in view of the fact that it has not been decided which of the two countries is at fault, would not be acting in the interests of peace.
  Commander LOCKER - LAMPSON: May I ask whether the right hon. Gentleman will do everything in his power to prevent the use of gas by the Soviet Government?
  Major WOODasked the Secretary of State for Foreign Affairs whether, in view of the fact that the rupture of diplomatic relations between Russia and China constitutes such an emergency as is contemplated by Article 11 of the Covenant of the League of Nations, His Majesty's Government will, under that Article, request the Secretary-General of the League to summon a meeting of the Council in order to take such action as may be deemed wise and effectual to safeguard the peace of nations?
  Mr. HENDERSON: His Majesty's Government have informed the United States and French Governments that they entirely associate themselves with the effort which those Governments are making by friendly advice to both sides to bring about a relaxation of the tension that has arisen between the Governments of China and the Union of Socialist Soviet Republics. The hon. Member may rest assured that His Majesty's Government are prepared to exhaust every means to secure a peaceful settlement of the dispute.
  Major WOOD: Seeing that this machinery has been set up for this special purpose, would it not be better to make use of it?
  Mr. HENDERSON: The hon. and gallant Member must be aware that when

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  one of the nations is a member of the League and the other is not it is not an easy matter to put the machinery into operation.
  Major WOOD: Is the right hon. Gentleman not aware that it is definitely stated that this machinery is to be used even if the countries concerned are not members of the League?
  Mr. HENDERSON: I am well aware of that fact, but I repeat that it is not easy to put that part of the machinery into operation.

  PORTUGUESE WEST AFRICA (BRITISH SEAMAN'S ARREST).
  Mr. HORE-BELISHAasked the Secretary of State for Foreign Affairs whether he has received a reply to the representations made by His Majesty's Ambassador at Lisbon to the Portuguese Government, as long ago as January last, regarding the arrest, on the charge of theft of £l, of Mr. A. J. Brewer, who was detained for nine months while awaiting trial in Portuguese West Africa and subsequently sentenced to 300 days' imprisonment and £18 fine or another 90 days in prison; and if he is now in a position to make a statement about this case?
  Mr. A. HENDERSON: The Portuguese Government replied on 25th April to the original representations made to them. The further representations of 20th June, to which I referred in my answer to the hon. Member on the 8th instant, were made as a result of that reply which I regret to say was unsatisfactory. Pending the receipt of a reply from the Portuguese Government to the representations of 20th June already referred to it would be inopportune for me to make any full statement about the case.
  Mr. HORE-BELISHA: Are we to assume that His Majesty's Government are insisting on proper redress being made to Mr. Brewer?
  Mr. HENDERSON: I have intimated that the first reply is unsatisfactory, and the fact that we are making further efforts is an indication that we are doing what the hon. Member desires.

  AGRICULTURE.

    POLICY.
    Dr. MORRIS-JONESasked the Minister of Agriculture whether he is aware of the marked difference in the conditions of the agricultural industry in Wales as compared to those ruling in England; and whether, before any legislation is initiated by him, he will consider the desirability of establishing a commission or a committee of inquiry to report thereon?
    Mr. N. BUXTON: The Ministry has a Welsh Department with headquarters at Aberystwyth under the control of a Welsh Secretary, whose advice is available on matters relating to the agricultural industry in Wales. In these circumstances, I do not consider that any useful purpose would be served by the establishment of a commission or committee of inquiry as suggested by the hon. Member.
    Viscount WOLMERasked the Minister of Agriculture what steps he proposes to adopt to relieve the agricultural depression now prevailing?
    Mr. N. BUXTON: I must ask the Noble Lord to await the statement on the agricultural policy of the Government which I hope to make in due course.
    Viscountess WOLMER: Has the right hon. Gentleman got any policy?
    Mr. KEDWARDasked the Minister of Agriculture whether the Government propose to call a conference of the three political parties in the House of Commons to consider ways and means of helping the basic industry of agriculture?
    Mr. N. BUXTON: I would refer the hon. Member to my reply to a similar question put to me on the 18th July by the hon. Member for Eye (Mr. Granville), a copy of which I am sending to him.
    Mr. KEDWARD: Is the right hon. Gentleman aware that since he replied to that question, he suggested himself that I should put down this question; and therefore, I hoped to have some different decision, especially in view of the Prime Minister's suggestion that we might cooperate on these matters?
    Mr. BUXTON: I might say that the reply indicated that the great differences between policies and parties constituted

    899
    an obstacle, but that I was anxious to secure the greatest possible agreement under the conditions which exist.
    Mr. SKELTON: How can the right hon. Gentleman tell the difference between the Conservative and the Labour agricultural policies, since he has just told us that he does not know yet what the Labour policy is?

    FOOT-AND-MOUTH DISEASE.
    Mr. GRAHAM WHITEasked the Minister of Agriculture if he has any evidence to connect any recent outbreak of foot-and-mouth disease with the importation of plate pollards?
    Mr. N. BUXTON: In one recent case suspicion attached to plate pollards as being the possible medium whereby foot-and-mouth disease was introduced, either through the pollards being infected or through the sacks in which they were contained being contaminated by South American animal products carried on the same vessel, but no proof was obtainable that the outbreak was due to this cause. Moreover, although a total of 26,128 sacks of plate pollards was carried on this vessel, no other outbreak occurred, which could be connected in any way with this cargo.

    WAGES.
    Mr. OLDFIELDasked the Minister of Agriculture if he proposes, in the near future, to establish machinery for the adjustment of agricultural labourers' wages upon a national basis?
    Mr. N. BUXTON: I must ask my hon. Friend to await the statement on the agricultural policy of the Government which I hope to make in due course.
    Brigadier-General CLIFTON BROWN: Will that statement be made before the House rises?
    Mr. BUXTON: No, Sir.

    MEAT AND WHEAT (BULK PURCHASES).
    Mr. OLDFIELDasked the Minister of Agriculture whether he proposes to establish machinery for the bulk purchase of meat and wheat?
    Mr. N. BUXTON: Perhaps my hon. Friend would allow me to defer a statement till I am able to make a general announcement on the agricultural policy of the Government.
    Earl WINTERTON: Will the right hon. Gentleman say what is approximately the date when that statement will be made?
    Mr. BUXTON: In the autumn, at the earliest possible opportunity.

    CO-OPERATIVE MARKETING.
    Mr. OLDFIELDasked the Minister of Agriculture what steps he proposes to take to encourage the co-operative sale of agricultural produce; and whether he will consider making the use of cooperative societies compulsory in the sale of certain classes of produce?
    Mr. N. BUXTON: I am considering what further steps can usefully be taken to hasten the marketing of produce along co-operative lines, and while I doubt the utility of compulsory methods in this connection, I shall be glad to consider any proposals which my hon. Friend may have in mind.
    Sir H. CROFT: Will the answers be given before or after the election?

    IMPORTED TOMATOES (MARKING).
    Viscount LYMINGTONasked the Minister of Agriculture whether the Government proposes to give effect to the recommendations of the Committee relating to the marking of imported foreign tomatoes?
    Mr. N. BUXTON: I am not yet in a position to add anything to the statement which I made on the 11th July, in reply to a question by the right hon. Member for Bury St. Edmunds (Mr. Guinness), a copy of which I am sending to the Noble Lord.

    TITHE.
    Viscount LYMINGTONasked the Minister of Agriculture if the Government will set up a commission to reexamine the question of tithes on agricultural land and include in the terms of reference not only the question of the cost of stabilisation, but the unequal incidence of the tithe on different areas of land?
    Mr. N. BUXTON: I do not consider that any useful purpose would be served by setting up a commission to consider the question of tithe rentcharge. This subject was exhaustively discussed when the Tithe Act of 1925 was under con-

    901
    sideration, and, so far as I am aware, no serious difficulties have arisen, since the passing of that Act, in the administration of the law relating to tithe rent-charge.
    Viscountess LYMINGTON: Is the right hon. Gentleman aware that considerable reference was made to it in the election addresses not only of his party, but of the Liberal party?
    Mr. BEAUMONT: Does the right hon. Gentleman think that the present arrangement is satisfactory?
    Mr. BUXTON: I understand that the Act is working well and difficulties in administration have not been raised.
    Mr. KEDWARD: Is the right hon. Gentleman aware that tithe on a good many farms is practically the full agricultural value of the land?
    Mr. BUXTON: That is the subject of another question.
    Sir G. RENTOULasked the Minister of Agriculture whether, having regard to the present depression in the agricultural industry, he is prepared to introduce legislation in order to remove or lessen the burden of tithe; and whether he is in a position to state the policy of the present Government in regard to this matter?
    Mr. N. BUXTON: The Government is not prepared to introduce legislation on the lines suggested by the hon. Member.

    LAND DRAINAGE.
    Mr. HURDasked the Minister of Agriculture the purport of his recent communication to the Wiltshire County Council on the subject of land drainage and of their reply?
    Mr. N. BUXTON: The Ministry has been in correspondence with the Wiltshire County Council on the subject of the maintenance of land drainage schemes which were carried out by the Council with financial assistance from the Ministry during the period 1921–26. The points raised cannot be set out shortly in reply to a Parliamentary Question, but I shall be happy to furnish the hon. Member with a copy of the correspondence when it is completed.

    BRITISH SUGAR (SUBSIDY) ACT.
    Mr. ROTHSCHILDasked the Minister of Agriculture whether it is the intention of His Majesty's Government to set up some form of inquiry into the past operation of the Sugar Subsidy Act with a view to ascertaining whether in its present form it ensures that the benefits accruing from the Act are equitably apportioned between the factory and the grower of sugar beet?
    Mr. N. BUXTON: I would refer the hon. Member to the reply which I gave on the 16th July to the hon. Baronet who sits for Caithness and Sutherland (Major Sir A. Sinclair). The report which is being prepared in my Department will review the past operation of the British Sugar (Subsidy) Act, 1925, and will provide data on which to base an opinion as to the distribution of the benefits which the Act has conferred.

  ALLSCOTT BEET-SUGAR FACTORY.
  Miss PICTON-TURBERVILLasked the Minister of Agriculture the number of hours daily worked by the men in the Allscott sugar-beet factory?
  Mr. N. BUXTON: During the last campaign a 12-hour day was worked at this factory, except at the weekly changeover when the men worked a somewhat longer spell followed by a corresponding period of rest.
  Miss PICTON-TURBERVILL: Is the right hon. Gentleman aware that the longer period is no less than 18 hours consecutive work? Would it not be possible for the Government to reduce the 12 hours shifts to eight hours, as in other factories, and, if that were done, would it not make a difference of 50 per cent. of unemployed men in a very badly devastated unemployment area?
  Mr. BUXTON: I am aware that reports have been received as to the hours of work in this particular factory, and pressure is being brought to bear with a view to a great change next season.
  Miss PICTON-TURBERVILL: Is the right hon. Gentleman aware that a large number of aliens are working there and keeping out our men, and that, whereas at the beginning of the factory, it was necessary to have aliens, it is no longer necessary to have so many?
  Mr. BUXTON: I was not aware of that fact, and I shall certainly make inquiries.
  Mr. DAY: Can the right hon. Gentleman say how many of the men are working 18 hours a day at week-ends?
  Mr. BUXTON: There have been exceptional cases reported to the Ministry.
  Miss PICTON-TURBERVILL: Is the right hon. Gentleman aware that it is not exceptional but every week-end when the sugar is being produced?

  BANK OF INTERNATIONAL SETTLEMENT.
  Mr. WISEasked the Prime Minister whether any opportunity will be given for the discussion in the House of the proposals in the Young scheme for the Bank of International Settlement before the proposed conference?
  The PRIME MINISTER: Parliament will be duly informed of the decisions that may be taken by His Majesty's Government in conjunction with the other Governments concerned, in regard to their proposals, and they can then, if desired, be debated by the House. But I cannot give any pledge that an opportunity will be found for a discussion before the Conference takes place, and I think that any such discussion is to be deprecated, as likely to embarrass the Government in the forthcoming negotiations.

  ELECTORAL LAW.
  Mr. HURDasked the Prime Minister whether in any inquiry into the Franchise Law, he will include among the subjects for consideration the position of nurses who, by the nature of their duties, are often unable to vote in their places of residence, and the justice of enabling them to give an absent vote as is done in the case of soldiers and sailors?
  The PRIME MINISTER: Beyond assuring the hon. Member that the point of his question will not be overlooked in our considerations, I can add nothing to what I have already said regarding terms of reference.

  NATIONAL THEATRE.
  Mr. REGINALD YOUNGasked the Prime Minister, if, in order to promote the artistic sincerity and dignity of Great Britain and to encourage the best elements in the British theatre, he will consider the establishment of a national theatre on lines somewhat similar to those followed by many European Governments?
  The PRIME MINISTER: I have a great deal of sympathy with the scheme which my hon. Friend has in mind. There are, however, serious difficulties arising partly from the number of similar schemes which are put forward. In present circumstances, therefore, I would only be holding out false hopes if I were to answer otherwise than that I regret that I cannot give a promise of a Government subsidy.
  Mr. HOLFORD KNIGHT: Has it been represented to the Prime Minister that there are various schemes for a national theatre?
  Mr. JAMES HUDSON: If those who are pressing the various schemes would come to an agreement, would the Prime Minister be prepared to reconsider the answer that he has made?
  The PRIME MINISTER: I think that my answer is partly an invitation to them to do so.

  CIVIL LIST PENSIONS.
  Sir WALTER de FRECEasked the Prime Minister whether, as the Civil List Pensions scheme was fixed when money had a different value than now, he will consider the appointment of a small select committee to consider whether the time has arrived to bring this whole system of awards more in accord with public wishes, both in respect of pension amounts and selection of applicants?
  The PRIME MINISTER: I will consider the hon. Member's suggestion, though I do not consider the procedure he suggests is very suitable.

  COAL MINES ACT.
  Mr. D. G. SOMERVILLEasked the Prime Minister whether he is now in a

  905
  position to make any statement on the intention of the Government with regard to the Coal Mines Act, 1926?
  The SECRETARY for MINES (Mr. Ben Turner): I have been asked to reply. I cannot at present add anything to the answers that have already been given on this point.
  Mr. SOMERVILLE: When do the Government propose to carry out their Election pledges?

  REPARATIONS (CONFERENCE).
  Captain EDENasked the Prime Minister where the forthcoming conference on reparations is to be held?
  Mr. A. HENDERSON: The matter is still under consideration between the Governments concerned, but I hope that a definite decision is now imminent.

  PRESERVATIVES REGULATIONS (FRUIT PULP).
  Colonel HOWARD-BURYasked the Minister of Agriculture whether he is aware that black currant pulp of the 1928 crop is being imported from the Continent in large quantities at 1½d. per pound; and whether, seeing that preservatives are used in this pulp, he can issue an Order to prevent the importation of this deleterious substance?
  The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Miss Lawrence): I have been asked to reply. My right hon. Friend is not aware of the particular importation referred to, but he knows that preserved fruit pulp is imported from the Continent for jam making, and he is not prepared to prohibit it on grounds of public health. Under the Preservatives Regulations, fruit pulp is not allowed to contain any preservative other than sulphur dioxide, and this is almost wholly eliminated in the process of jam making, the maximum proportion allowed in the jam being 40 parts per million.
  Colonel HOWARD-BURY: Is the hon. Lady aware that this 1928 fruit pulp is coming in and is being sold by grocers as this season's fruit jam? Is she aware that these foreign importations are
  906
  killing the home trade, and is it part of her policy to encourage foreign imports at the expense of British growers?

  KEW GARDENS.
  Mr. BENNETTasked the Minister of Agriculture whether the charge for admission to Kew Gardens is to be continued?
  Mr. N. BUXTON: I am glad to announce that the admission fee of one penny to the Gardens on days other than student days will be abolished. I am arranging that the change shall be brought into operation on August Bank Holiday.
  Mr. ORMSBY-GORE: What will be the charge on the other days?
  Mr. BUXTON: It will remain as now.
  Dr. VERNON DAVIES: What is the estimated loss?
  Mr. BUXTON: About £5,000.
  Commander LOCKER-LAMPSON: Who will bear it?
  HON. MEMBERS: You will.

  HOUSES OF PARLIAMENT.

    LIGHTING.
    Mr. STRAUSSasked the First Commissioner of Works when the present lighting system was installed in the Houses of Parliament; and whether he will investigate its adequacy on practical and aesthetic grounds?
    The FIRST COMMISSIONER of WORKS (Mr. Lansbury): Electric lighting was first installed in part of the Houses of Parliament in 1883 and has since been extended on various occasions, and in particular to the Chamber of the House of Commons in 1912. Many of the fittings now used in the House were originally gas fittings, but are considered to be efficient, and the heavy expenditure on replacing them would seem to be unnecessary. If, however, my hon. Friend has in mind any place where he considers that the lighting should be improved, I shall be happy to consider the matter.
    Mr. DAY: Is the right hon. Gentleman aware that it is absolutely impossible for messengers to find Members on the Terrace of the House?
    Earl WINTERTON: Will the right hon. Gentleman give sympathetic consideration to the fact that in some parts of the House the electric lights are unshaded, and that it is held by medical advisers that unshaded electric lights such as are used in most public buildings are inimical to the eyes?
    Mr. LANSBURY: I shall be very glad to give that matter consideration.
    Mr. BEAUMONT: Will the right hon. Gentleman investigate the question of the natural, as well as the artificial light in the House?

    INDICATORS (TERRACE).
    Mr. HURDasked the First Commissioner of Works if he will cause indicators to be placed on the Terrace, so that Members who are in consultation with constituents there may carry out their duties in the House as occasion arises?
    Mr. LANSBURY: An indicator placed on the Terrace of the Houses of Parliament would be visible from a very small portion of the Terrace only, and there is already an indicator in the Members' Smoking Room which opens directly from the Terrace. In the absence, therefore, of a general demand from hon. Members, I feel that the provision of an indicator, as suggested, is unnecessary. There are also difficulties in the way of placing an indicator in the open air.
    Mr. DAY: What would be the cost of an indicator?
    Mr. LANSBURY: I think the cost would be very small, but it is considered to be quite unnecessary.

  GOVERNMENT DEPARTMENTS.

    OFFICE OF WORKS (HOLIDAYS).
    Mr. REGINALD YOUNGasked the First Comimissioner of Works if any salary or wage-earners employed in his Department, or employed by contractors working under agreement with his Department, are not allowed annual holidays with pay; and whether, if this
    908
    is so, he is able to take steps whereby his own Department and his contractors will grant this right?
    Mr. LANSBURY: So far as direct employés are concerned, the general rule in my Department is to grant holidays with pay to all full-time employés engaged for regular work (including seasonal work). The only exceptions to this rule are caretakers, who, in my Department as in all other Departments of the Service, continue to receive their pay when absent from duty, but are required to provide suitable substitutes at their own expense. An extension of the right to these employés and to employés engaged for temporary work, or as temporary substitutes for regular employés, is a matter that could only be considered in connection with a review of the general service arrangements for granting holidays with pay. The conditions granted to the employés of contractors working under agreement wish my Department have to satisfy tin: terms of the Fair Wages Resolution, and I have no power to call upon contractors to grant conditions which are more favourable than those commonly recognised by employers and trade societies in the trade in the district where the work is carried out.
    Mr. ALBERY: Can the right hon. Gentleman give any reason why caretakers should be excepted?
    Mr. LANSBURY: Because they have privileges which other workmen do not possess.
    Mr. W. J. BROWN: Is not the right hon. Gentleman aware that the Civil Service practice is to give leave with pay, and without calling upon the individual civil servant to find a substitute; and, if that is the general Civil Service practice, why cannot he apply it to these poor charwomen?
    Mr. LANSBURY: I am not aware that it is the general Civil Service practice in regard to caretakers. I am not aware that that practice differs in any way from that which obtains in the Department of the First Commissioner of Works.
    Mr. H. W. WALLACE: Is the general review to be undertaken by the right hon. Gentleman's Department?
    Mr. LANSBURY: No, Sir. It is not.

    STAFF ACCOMMODATION (BASEMENTS).
    Mr. W. J. BROWNasked the First Commissioner of Works whether he is aware that certain staffs in the Office of Works and the Ministry of Health are obliged to work in sub-basements and basements much below ground level and lit in the main by artificial light; that it is now proposed also to put Board of Trade staffs in these basements, and that the Chief Medical Officer of the Ministry of Health has reported adversely on the use of these basements for this purpose; and whether he will provide alternative accommodation and so avoid the employment of the staff under these conditions?
    Mr. LANSBURY: A small number of staff work, during part of the day only, in the sub-basement, which is lit by artificial light. Other staffs work in the basement courts which enjoy good natural light, and it is proposed to utilise other similar courts for Board of Trade staffs. I am informed that the Chief Medical Officer of the Ministry of Health has not reported adversely on the use of the basement, but, on the contrary, this officer and an officer of the Medical Research Council reported that, subject to the execution of certain works, the basement courts were quite suitable for occupation by clerical staffs. Effect has been given to the recommendations of these officers. Under ordinary circumstances, I should prefer that all staffs worked above the ground level, but at present we have no other available accommodation. My hon. Friend may be assured that everything possible has been done, and will continue to be done, to keep these offices as light, airy and healthy as possible.
    Mr. BROWN: Is there any prospect within a reasonable time of Montagu House site and the site in Whitehall where the Treasury now stands being utilised for the erection of really adequate public buildings?

  PRIME MINISTER (MOTOR CAR).
  Mr. DENMANasked the First Commissioner of Works whether, pending a decision by this House as to a revision of the emoluments and allowances of the office of Prime Minister, he will secure for the Prime Minister the use of a motor car at the public expense?
  Mr. LANSBURY: I would refer my hon. Friend to the reply given by the Prime Minister to the hon. Member for North Paddington (Mr. Bracken) on the 15th instant, when it was stated that no action could be taken on this and cognate questions except in pursuance of an expressed general opinion of this House.
  Mr. DENMAN: In view of the partially satisfactory nature of the reply, I desire to give notice that I propose to call attention to this matter on the Motion for the Adjournment in order to get an indication of the House's views.

  BOTANIC GARDENS, EDINBURGH (PERAMBULATORS).
  Mr. MATHERSasked the First Commissioner of Works whether he can now indicate the result of his consideration of the proposal to permit perambulators to be wheeled through the Botanic Gardens, Edinburgh?
  Mr. LANSBURY: There are many difficulties in the way of adopting my hon. Friend's proposal, but as an experiment, in order to be able to gauge whether inconvenience is caused, I have agreed to authorise the Regius Keeper to allow perambulators carrying young children to be wheeled through the gardens, for a period of three months. It may interest my hon. Friend to know that permits for vehicles carrying invalid children or adults have always been obtainable under the existing practice.

  TRAFALGAR SQUARE (SEATS).
  Mr. JAMES GARDNERasked the First Commissioner of Works whether he will consider the provision of seats in Trafalgar Square similar to those now provided in the Mall?
  Mr. LANSBURY: I propose to consider my hon. Friend's suggestion in consultation with the police authorities. Certain objections to the placing of seats in Trafalgar Square have, I understand, existed in the past.
  Mr. GARDNER: May I remind the right hon. Gentleman that the police made similar objections to the provision of seats in the Mall?

  HYDE PARK (RAILINGS).
  Mr. JAMES GARDNERasked the First Commissioner of Works whether he will take steps to approve the amenities of public spaces under his control, thus following the example of many English and Continental cities, notably Brighton, by removing the railings surrounding Hyde Park?
  Mr. LANSBURY: My Department is all in favour of getting rid of railings in parks, unless they definitely serve some necessary purpose, and it is aiming at the gradual abolition of railings wherever possible. The railings around Hyde Park are, however, required to enable this open space to be shut at night-time.
  Viscountess ASTOR: Will the right hon. Gentleman consider abolishing the railings around private parks such as St. James Square?
  Mr. MACQUISTEN: And will the right hon. Gentleman also take into consideration the large amount of railing around the Marble Arch every Sunday evening?
  Mr. LANSBURY: I should like to inform hon. Members that, wherever possible, railings are being taken down at the present time.
  Mr. GARDNER: Why is it necessary to close Hyde Park at night?

  HISTORICAL BUILDINGS (PRESERVATION).
  Major CHURCHasked the First Commissioner of Works whether he will consider the desirability of introducing legislation having for its object the protection of our national historical buildings at present under ecclesiastical control, for example, Westminster Abbey, from acts calculated to destroy their historical significance?
  Mr. LANSBURY: As at present advised, I am not prepared to promote legislation with this object.

  JUSTICES OF THE PEACE (ADVISORY COMMITTEES).
  Dr. MORRIS-JONESasked the Solicitor-General whether any steps are contemplated to review the number and
  912
  composition of advisory committees in the counties, county boroughs, and municipal boroughs of England and Wales?
  The SOLICITOR-GENERAL (Sir James Melville): Advisory committees for the appointment of justices of the peace are being reconstituted and reappointed for fixed terms of office. Provision is made for the automatic retirement of half the members of the committees every three years. The work is being carried out as expeditiously as possible, having regard to the inquiries which must be made as to the suitability of existing members, and of persons recommended for appointment and also having regard to the need for reviewing the composition of committees already reconstituted, at the end of their terms of office.
  Dr. MORRIS-JONES: Will the hon. and learned Gentleman make representations to the Department for which he answers in this House, that there is very considerable dissatisfaction in the country generally with regard to the constitution of these advisory committees, and will he take it up as an urgent matter?
  Mr. EDE: What steps are taken to fill casual vacancies on the committees?
  The SOLICITOR-GENERAL: I should like to have notice of the latter question. With regard to the former, I am not aware of any dissatisfaction in the country generally, but, if such dissatisfaction exists, and if it is aptly communicated, steps will be considered in reference to it.

  UNEMPLOYMENT (STOCKPORT EXCHANGE).
  Mr. HAMMERSLEYasked the Minister of Labour whether she is aware that the administration of the Stockport Employment Exchange has become harsh and unjust during the last month; and whether she will give immediate instructions to the officials to conduct then-duties with less administrative harshness?
  The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. Lawson): The answer to the first part of the question is in the negative. The second part, therefore, does not arise.
  Mr. HAMMERSLEY: Is the hon. Gentleman aware that the question refers to an alteration in the personnel of the Exchange during the last month, and, if I bring details to his notice, will he look into them immediately?
  Mr. LAWSON: I am not aware of the point put by the hon. Member, but, if he brings details to my notice, I shall be pleased to have them investigated.

  WASHINGTON HOURS CONVENTION.
  Lieut.-Colonel GRANT MORDENasked the Minister of Labour whether, when she published her decision to ratify the Washington Eight Hours Treaty, she had taken the advice of the Law Officers of the Crown?
  Mr. LAWSON: When the Government came to their decision in this matter they were aware that, as is well known, it would be necessary to introduce legislation amending the existing law, and there was, therefore, no occasion to consult the Law Officers at that stage. In framing the necessary legislation, the Government will, of course, have the assistance of the Law Officers.

  POST OFFICE.

    RURAL TELEPHONES, ROSS-SHIRE.
    Mr. MACPHERSONasked the Postmaster-General when he proposes to extend the rural telephone service to the Ullapool-Lochbroom district of Ross-shire; and whether, in view of the isolation of townships and villages and their distance from medical or other assistance in a case of emergency, he will establish accommodation exchanges and/or call offices at such places as Dundonnell, Strathcannard and Achiltibuie?
    The ASSISTANT POSTMASTER-GENERAL (Mr. Viant): A canvass of prospective subscribers in this district is being carried out with a view to ascertaining if there is sufficient demand for telephone facilities to warrant the considerable capital expenditure which would be involved in providing them. The question of the provision of call offices at the villages named is under consideration.
    Mr. MACPHERSON: Will the hon. Gentleman consider the advisability of
    914
    not demanding a large minimum number of subscribers, as at the present time the number is too large in all rural districts?
    Mr. VIANT: I might add that the whole question is under consideration.
    Mr. LEIF JONES: Will the hon. Gentleman consider the advisability of going ahead of the public demand in this matter?
    Mr. VIANT: I am afraid I cannot add anything further to my original reply.

    POSTAL CONFERENCE (COMMEMORATIVE STAMPS).
    Captain CAZALETasked the Postmaster-General at what date the official issue of postage stamps commemorating the Postal Conference in London will cease?
    Mr. VIANT: The commemorative issue will be discontinued when the present stock is exhausted, which I anticipate will occur towards the end of August.

  QUESTIONS TO MINISTERS.
  Sir WILLIAM DAVISON: On a point of Order. May I not put a Private Notice question to the Minister of Health, which I understand he is prepared to answer?
  Mr. SPEAKER: The question the hon. Member wished to ask was submitted to me, and I would not allow it to be asked as a Private Notice question. It must be put on the paper in the usual way.

MESSAGE FROM THE LORDS.
That they have agreed to—
Isle of Man (Customs) Bill, without Amendment.
That they have passed a Bill, intituled, "An Act to make further provision with respect to the construction of certain references to rateable value in enactments relating to the drainage and protection of land." [Land Drainage Bill [Lords].
Land Drainage Bill [Lords].
Read the First time; to be read a Second time upon Wednesday, and to be printed. [Bill 16.]

ORDERS OF THE DAY.

  HOUSING (REVISION OF CONTRIBUTIONS) BILL.
  Order for Third Reading read.
  The MINISTER of HEALTH (Mr. Arthur Greenwood): I beg to move, "That the Bill be now read the Third time."
  It will be within the recollection of hon. Members that the Money Resolution which originated this Bill and the Bill itself have so far passed through all their stages without much debate. The Bill is one which I described at an earlier stage as containing a very modest proposal. That proposal is merely one to continue for the present the existing subsidy under the 1924 Act and to discontinue, as the late Government suggested, the subsidy under the Housing Act of 1923. All that I need to do this afternoon is to deal with some of the statements which were made by the right hon. Member for Edgbaston (Mr. Chamberlain) during an earlier stage of our discussions. In the first place, the right hon. Gentleman discovered a mare's nest, not, I imagine, the first that will be discovered by hon. and right hon. Members on the other side. We were told that there must have been something in the nature of a Government crisis on this matter, and in order to bolster up this purely imaginary case, the late Minister, my predecessor, quoted some statements from a public newspaper reporting a speech of the Prime Minister's, when he might have saved himself all the trouble by reading the OFFICIAL REPORT for the 3rd July, where the Government's policy was outlined and where it was made quite clear that a short Bill, merely dealing with the continuance of the subsidy under the 1924 Act, would be brought in during this part of the Session.
  I should like especially to refer to what was, in effect, the late Minister's apologia for his own policy insofar as it affects this Bill, namely, the question of the relation between subsidy and prices. The right hon. Gentleman, if he will allow me to say so, has an obsession on this question. He has convinced himself that there is that intimate relation between subsidy and prices that he wishes
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  to exist, and it is extraordinarily interesting to observe that hon. and right hon. Members opposite are always prepared to invoke the aid of the twin gods demand and supply when it supports their own pet theories to do so, but that they are equally prepared to ignore their existence when they do not support those theories. The question of the relation between subsidies and prices is, of course, very complex. It is broadly true that the prices of houses will follow the trend of the general price level, and it would be an astonishing thing if the prices of houses to-day stood as high as they did, say, in 1920, because obviously the price level at that date was much higher than the price level now. Apart from the change in the level of prices as a whole, which is reflected in the change in the prices of houses, the outstanding factor which has governed the level of the price of houses has been the change in demand and supply.
  I am astonished to think that hon. Members opposite should have thrown over what, I believe, is the only cardinal part of their economic faith which will stand the test to-day. There is obviously a close relation between the demand for houses and the price. We were reminded last week of the course of the price level of houses under the Act of 1919. It was perfectly obvious that when the then Minister of Health resigned, and his place was taken by Lord Melchett, who had orders to liquidate the existing housing responsibility, the price of houses would fall. The price of houses fell because not another house was ordered. It was obvious, therefore, that the price of houses would fall, and when the right hon. Gentleman the Member for Edgbaston took office in 1923, and introduced his Housing Bill with a new subsidy, what was the situation that confronted him? The builders in this country were virtually bankrupt. They had done everything to build houses at prices which were uneconomically low; they were prepared to do anything to get orders, but there were no orders. The right hon. Gentleman became the fairy princess who came with the orders, and prices rose.
  Prices rose after the right hon. Gentleman's Act was put on the Statute Book because the demand for houses increased. In 1927, when he reduced the subsidy, and the demand for houses fell off, quite

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  naturally the price of houses fell. I have never denied that that would take place; indeed, I argued that that was precisely what would happen, that the right hon. Gentleman would have his glow of exaltation when prices had fallen, and that we should be able to say, "Yes, but you have not got the houses," and that is precisely what happened. Obviously, in the change of the price level with regard to any commodity, you will always find a number of contributory factors. In the late Parliament I analysed some of them at length. The right hon. Gentleman the Member for Edgbaston added some of them up, and said, "Yes, they will account for £50 in the fall of the price of houses." Then, jumping about 15 hurdles all at once, he said, "The rest of the reduction is due to the fall in the subsidy," without saying a word then or since as to the change which took place in the demand for houses.
  I want to carry back the minds of Members who were here in 1923, when the right hon. Gentleman introduced a subsidy of £6 per year for houses falling within a particular size. The idea in the mind of the right hon. Gentleman was to reduce the price to the buyer. He said, "Here is a gap between the price at which the builder can build houses and the price at which people are prepared to buy houses; how can I bridge that gap and bring down the price to the level which is within the competence of the purchaser so that he may buy?" He said to himself, "I will introduce the subsidy," and he introduced the subsidy with that object. If it did not have that object, it had no object at all, except to put money into the pockets of the master builders. If it were not devised with a view to lowering the prices of houses to the purchasers it was a proposal which had no real value at all. The position in which the right hon. Gentleman found himself therefore was that in 1923 he put on a subsidy in order to reduce the price of houses, and in 1927 he reduced it also in order to reduce the price of houses. He never suggested that the subsidy would raise the price of houses. On the contrary, it was to reduce it, and yet when circumstances changed, he used the same argument to show that, if only he took off the subsidy which he put on, it would reduce the price of houses. The right hon. Gentleman cannot have it both ways. He
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  cannot say that, if he puts on a subsidy, it will reduce the price of houses, and that, if he takes it off, it will again reduce the price of houses, because had he done that monthly at regular intervals, houses would have been as cheap to-day as it was possible for houses ever to be. The right hon. Gentleman is guilty of the old fallacy of post hoc, ergo propter hoc.
  I do not want to press him unduly on that, but I want to put a question to the House which has never been answered in the course of the Debates on the relation of subsidy and prices. How exactly does a reduction of a subsidy reduce the prices of houses? That is a very pertinent question to put in this discussion. There is only one answer. It is that by reducing the demand for houses, and in no other way, can the reduction of a subsidy affect prices. The right hon. Gentleman said, "Ah, but early in 1927, before the subsidy was actually taken off, the prices of houses began to fall." Certainly, they began to fall in advance of the Act, not because of any subsidy, hut because of the anxiety and uncertainty on the part of master builders, and their desire to get in early for what orders there might be; but it is true to say that anybody might quite well reduce the prices of houses to-day to a level which would bring into the bankruptcy court practically every master builder in this country.
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  If I were from now onwards to refuse approval for the building of a single house more than those that are on the stocks to-day, of course, the prices of houses would fall substantially, and as soon as orders were put out again, the prices obviously would rise. That is precisely what happened during the last two years. The right hon. Gentleman cut his subsidy and saved his money, and must have known that the only way in which the reduced subsidy could be effective in reducing prices was by reducing the demand. The real difference between hon. Members opposite and ourselves is that they have put the emphasis always on prices, while we have put the emphasis on houses. I am not suggesting that that means that the right hon. Gentleman does not care about houses, nor does it mean that I do not care about prices; it is a question of the emphasis placed upon one

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  or the other of the two things. The right hon. Gentleman has succeeded in reducing the subsidy, and in reducing the price of houses, but he has also reduced the number of houses that have been built. May I ask the House to consider for a moment or two what was the right hon. Gentleman's object in introducing the subsidy of 1923? It was to restore private enterprise in the building of houses. The right hon. Gentleman was not concerned with the development of municipal enterprise. He was concerned with the restoration of private enterprise. He wanted to bridge a gap that existed between 1923 and to-day. He believes that that gap has been bridged, and he has said that in his judgment the subsidy under the 1923 Act should come to an end. I agree with him, but my reasons are rather different. I am not inclined to disagree with his view that the subsidy under the 1923 Act has served its purpose, but the truth is that in the last year or two the situation has been saved by the building of houses by local authorities under the Act of 1924, and that the subsidy of the late Minister has not saved the situation either as regards private enterprise or local authorities building under the Act of 1923.
  What has happened? If you go back to 1925 when, it must be remembered, the 1923 Act had had a year's run more than the 1924 Act, the number of subsidy houses built by local authorities amounted to about 27 per cent. of the total number of subsidy houses built, that is, in the year ending 31st March, 1925. In the year ending 31st March of this year, the proportion of subsidy houses built by local authorities, had increased to 53 per cent. and was twice the percentage that it had been four years before. Let me put it another way. In the year ending 31st March this year, the number of houses built by private enterprise under the Act of 1923, was about the same as it was in 1925, four years ago. It was less than three-quarters of the number built by private enterprise in 1926. In other words, building by private enterprise, even with the subsidy, has become relatively less important. But if you turn to the Act of 1924, you find in the year ending 31st March this year, the num-
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  ber of houses built under the Act of 1924 was about double the number built in 1926. In other words, the real contribution to-day is being made by the local authorities rather than by private enterprise, and from that point of view, as far as I am concerned, the 1923 Act subsidy can go. But I would like to make it clear to the House that that does not necessarily mean that all house building eligible for public assistance must necessarily be carried cut by local authorities. As I said last week, my primary object in continuing the subsidy under the 1924 Act at its present level is to enhearten and encourage the local authorities, but it is true that public utility companies and other bodies and private persons may, if they wish, continue to build under the 1924 Act, provided, of course, they fulfil the special conditions which were laid down in 1924 with regard to houses being let, and so forth. Most hon. Members will, of course, be familiar with chose conditions, and it will be interesting to see to what extent public utility companies, large employers, and so on, are prepared to use this Act in order to provide houses to be let.
  There is little point in my detaining the House at any length. Last week I was accused of introducing a proposal which did nothing. That was a statement by the right hon. Member for Edgbaston, and a little later he went on to scarify the House by saying it would cost £27,000,000 capital expenditure. It is not a Bill, as the right hon. Member for West Woolwich (Sir K. Wood) has already been told, for dealing with the larger aspect of this question. It is a Measure to get continuity of effort on the part of local authorities pending a more comprehensive Measure including slum clearance. It is, of course, easy now for the right hon. Member for West Woolwich to appear as a housing reformer, filled with enthusiasm for slum clearance, which appeared very low in the programme of the late Government, seeing that they did nothing about it, and when he criticised me for not having done enough, and pointed to the tremendous importance of dealing with slum clearance, I was very glad to think that at a later stage this Session I shall have his whole-hearted support. I am asking for the Third Reading of this Bill merely as a preliminary

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  step to a larger Measure. I have been criticised—I think the word to use is "condemned" —by the right hon. Gentleman the Member for West Woolwich for not having done more. I have not done more, because I was concerned primarily to avoid discontinuity of building, and to give the Government time to produce a Measure of a much larger kind, and the fact that hon. Members have not thought it worth while so far to divide against this Bill, or the Money Resolution which preceded it, leads me to believe that they are prepared to allow me to have the Third Reading of the Bill.
  Everybody in this House realises that it would not have been possible at this stage of the Session to have brought in what, I hope I might call, a first-class Measure with any degree of success, partly because it would not have been fair to the House, and partly because it would have been impossible for me to have framed it, and I am asking now just for this simple thing. There is one item of policy in it, and that is the intention to support the late Government in getting rid of the subsidy under the Act of 1923. That is an act of policy. The decision to prolong the existing subsidy and the Act of 1924 is not an act of policy. It does not prejudice in any way what may happen in the future. It is a reasonable thing to do to permit me to stop an act which, I believe, would have prejudiced the building of houses under the Act of 1924, to avoid the great slump in house building which followed the introduction of the cut in the subsidy in 1927, and if I can get local authorities, as I understand I can, to continue their building pending a larger Measure, then I shall consider this Bill will have been amply justified. It is in that spirit that I bring what I call this small Measure to the House.
  Sir KINGSLEY WOOD: I have heard many speeches by the right hon. Gentleman, all of which I have enjoyed, but I do not think I have ever heard him make a more apologetic speech, at any rate during the last four or five years. He seems to be very uneasy about this particular Measure. He has been ploughing the waves very heavily during the last ten minutes or quarter of an hour. I wonder why it is. I think the reason
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  is this; If you hold the views which the right hon. Gentleman holds with regard to the subsidy, there is really no explanation, and there is no excuse for the proposals which are before the House to-day. The right hon. Gentleman said that my right hon. Friend the Member for Edgbaston (Mr. Chamberlain) had raised a mare's nest in his speech on the Financial Resolution when he referred to the statement of the Prime Minister. He did not explain what the mare's nest was. He simply contented himself with referring to a quotation in the OFFICIAL REPORT.
  What did the Prime Minister say at Durham a few days ago? He said what everyone would have expected him to say when enunciating the policy of the Socialist party in relation to the housing subsidy. He told his audience at Durham that it was his intention and the intention of his Government to go back to the 1924 Act, and he certainly—as, I think, anyone who will compare the reports in the various newspapers will agree—gave them to believe, as we should all expect, that the full subsidy was to be revived by the present Government. It has always been the policy of the Socialist party. I remember very well when my right hon. Friend first introduced what we call the "cut." It was strenuously opposed by every Member of the Labour party in Parliament at that time. It was denounced most vigorously and most streunously, and the real difficulty of the right hon. Gentleman this afternoon is the thought that he is not following out, not only the policy of the Socialist party, but he is not following out to their proper and logical conclusion the arguments which he has addressed to this House this afternoon.
  I said he was apologetic. So he was, and, I think, unduly so. He said that this was merely a minor Measure, that he obviously could not be expected to bring in a great housing scheme at the present time, and that it was right that the House should wait until the autumn for a larger Measure. That was a reasonable statement only in this sense, that the mere fact of preparing a Bill of that character would take a considerable time. But I dissociate myself from the view which has been expressed by Ministers so often during the last few weeks, that they can

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  not be expected to produce their policy within three weeks, when they had carefully prepared their policy before the Election. But where do we stand as far as this Measure is concerned?
  I want hon. Members opposite to realise that this Measure does all that the Minister of Health intends to do so far as subsidies are concerned. In his Bill in the autumn he does not intend—as I understand him, at any rate—to deal further with the question of subsidies, because during the debate on the last occasion he said:
  "Therefore, I propose for the time being, that is to say, until after September of next year, when the next revision is due, to maintain the subsidy under the 1924 Act at its present level."—[OFFICIAL REPORT, 15th July; col. 73, Vol. 230.]
  Therefore, there is no question that in the autumn, at any rate, the right hon. Gentleman is not going to deal with this particular side of the matter. He has made his decision to continue the subsidy on the present level, and hon. Gentlemen opposite, although they have been announcing this policy of subsidies up and down the country as their main solution of the housing question, must not expect anything further at the present time.
  But if the Minister believes that subsidies are good, that they accelerate house building and do not affect the question of cost, why is it that we have not gone hack, as the Prime Minister promised at Durham, to the full subsidy of the 1924 Act? Nobody has told us that. Neither the Minister of Health nor the Parliamentary Secretary has explained why they are not going back to the full subsidy, and we await their explanation. It may be, for I have not yet heard it disposed of, that there has been a change of mind. I cannot think the Prime Minister can have been so sloppy and inexact nine days ago when making the statement he then made. I cannot think the Labour party are so inconsistent that this change should have occurred within the last nine days. As I understand it, they need have no apprehension about their political fate in this matter. The hon. Member for Withington (Mr. E. D. Simon), who, I believe, is the chairman of the Liberal Housing Committee, and who spoke for the Liberal party, made practically the same kind of speech as the Minister of Health. He is a full believer
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  in the subsidy. He would even go further. I have had the pleasure of reading his writings and books, and he would give subsidies for the purpose of housing people with large families. Therefore, the right hon. Gentleman need have no anxiety so far as his political fate is concerned. The chairman of the Liberal Housing Committee, whom we welcome with us again this afternoon, is fully in favour of the policy of subsidy. Why, then, are not the Government going on with their full subsidy proposals? The hon. Member for Withington will not stop them. During the last year or two his life has been spent, very rightly and properly, in advocating subsidies for houses. He is an entire supporter of the proposal.
  May I, as an outsider, make a suggestion as to why the Labour party have not gone on with the full proposal this afternoon? Is it that the Chancellor of the Exchequer has intervened? Has he stepped forward at the last moment and said, "No, I am looking after the nation's purse and I am not prepared to have the nation's money spent in this way—going into the pockets of all sorts of people."? At any rate, we have had no explanation, and I hope hon. Members opposite will support me in demanding an explanation, because they will have to give an explanation to their constituents. What are they going to say when they go back to their constituents in the autumn? For months and months they have been telling them that the subsidy for housing was cut down by the wicked Conservatives, and now, apparently, they are to go back without any explanation from their leaders on the Front Bench, and say, "We are very sorry we do not know why it is so, but for some unaccountable purpose the right hon. Gentleman, in whom we place so much reliance, is not going on with the full subsidy." At the meetings of the Independent Labour party, even at meek gatherings of that description, surely some one will get up to ask, "Why is it that the Minister of Health acted in this way?" The right hon. Member for Shettleston (Mr. Wheatley) in a powerful speech in the course of the Debate the other day, put the Socialist policy most clearly. I have not condemned the right hon. Gentleman with anything like the severity shown by the right hon. Gentleman who was the Minister of Health in

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  the 1924 Government. A very notable Minister of Health he was, and it is his Act of Parliament that the Socialist party are relying upon to-day. Why are they not continuing his full policy? I think I can say on behalf of Members in all parts of the House that we should like an explanation from the Government on this matter.
  Nothing interested me more the other day than the speech which we all enjoyed, because it was a very splendid effort, of the Parliamentary Secretary to the Ministry of Health. She gave a unique explanation of the rise and fall of the Addison house. My hon. Friend the Member for Falmouth (Sir J. Tudor Walters) must have heard the explanation with as much enjoyment and amusement as I did. She had got the novel idea—where she got it from I do not know, but she had got it somehow—that the soaring of the price of the Addison house to £1,100 or £1,200 was somehow or other due to the rise of the wholesale prices index figure. I can imagine the situation; because the hon. Member for Falmouth and myself were associated with the question at the time. Apparently the builders stood back and saw prices soaring up to £700 and £800 and said, "It is the wholesale prices index figure that is doing it." There is an hon. Gentleman here this afternoon whom I hope we shall hear in the course of the Debate who has been a builder and contractor for 20 years. He must have gone through that anxious time when we saw these prices soaring and the wholesale index figure doing all sorts of things and the nation's money going—where? [HON. MEMBERS: "West!"]
  But that was not the explanation which the right hon. Gentleman the present Parliamentary Secretary to the Board of Agriculture gave, and surely he ought to know something about the price of the Addison house and why it rose. I do not criticise him for a moment. He said the cause of the tremendous rise, and undoubtedly the great waste of money, was the system which was adopted of limiting the financial partnership of the local authorities with the State to the proceeds of a penny rate. He said that because we gave the local authorities so little financial interest in house-building at that time they naturally did not exercise that vigilance and care in relation
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  to the price of houses we expected from them and would have seen had they had a larger financial interest. Another explanation which we have not heard from the Parliamentary Secretary to the Ministry of Health but which was given by the Parliamentary Secretary to the Ministry of Agriculture blamed the Labour party. He said the unions had failed to meet their obligations in regard to increasing the personnel of the trade, and that from first to last he had never had the slightest support and assistance from the Labour party.
  There was another explanation which he gave only as lately as 25th May. He said then that the reason for the high cost was not this extraordinary behaviour of the wholesale prices index figure but that the rise was due to the profiteer, and that he was refused additional powers which would have helped to stay the rise in prices. I wonder why it is we hear nothing about the Profiteering Bill in connection with these proposals? I have never heard a speech in this House from the right hon. Gentleman during the past 4½ years until to-day unless he has mentioned the Profiteering Bill. What has become of the Profiteering Bill in connection with his proposals? As I have always understood it, the submission of the right hon. Gentleman was, "Yes, we must have subsidies"; but hon. Gentlemen opposite will be sorry to hear that so little is the faith of the right hon. Gentleman in building contractors that he must have a Profiteering Bill. This afternoon we have not heard a single word in connection with that matter.
  One of the most interesting things I saw during my official connection with the Ministry of Health was a letter which came to my notice a few days after the cut in the subsidy had been first announced. It came from a building contractor. He addressed a letter to a local authority with whom he had a building contract. He had entered into a building contract, he saw the announcement in the papers that the cut in the subsidy was to come some months later, and he wrote a letter in these terms:
  "Dear Sir,—In order to meet the reduced subsidy we have brought down the price of tiles, machine-made quality, by 9s. 6d. per 1,000."
  It was sufficient for this gentleman to see an announcement of a reduction in

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  the subsidy. There was no question about theories for him; no question about the wholesale index price or matters of that kind. He brought down the price straight away. [HON. MEMBERS: "Profiteer!"] He did not wait until the cut in the subsidy was made. He wrote out a letter straight away, and said, "We have cut down the price already." I think that is a very illuminating record.
  Mr. WINTERTON: Will the right hon. Gentleman give us the date of that letter?
  Sir K. WOOD: I think that question should be addressed to the Department. There is another explanation which has been offered by hon. Gentlemen opposite. They found it very difficult to get over the fact that houses were only costing £339. That is the average price, and that fact is the best contribution which has yet been made to housing in this country. There is also the fact to be borne in mind that at the time when my right hon. Friend the Member for Edgbaston was in office houses of all kinds, including those with the subsidy and those which were built without subsidy, were built at the rate of at least 160,000 a year. When my right hon. Friend left the Ministry of Health £339 was the average price for a house. I wonder whether the Labour party will be able to point to a record like that when they leave office.
  Of course, some explanation has to be given if you are going to say that subsidies are a solution of the house building problem. It was said the other day that there had been scamping in connection with house construction in recent years. That has been said again and again in this House. The explanation was not the index figure, because that is the latest suggestion. The previous suggestion was that it was the scamping of houses, and the charge was made against the late Government that the houses they had erected were badly built, and that our policy had brought about the building of the worst kind of houses. I wish to say, in the first place, that the specifications for house building have not been altered by the Ministry of Health. As a matter of fact, in many cases, owing to the reduction in the cost of materials, improvements have actually been made in the standard of houses. I am very anxious
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  to disabuse the minds of hon. Members opposite on this question, and I would like to remind them of a reply which was given by the Minister of Health on this matter on the 18th July. The right hon. Gentleman was asked by the hon. Member for Stourbridge (Mr. Wellock):
  "Whether he has any information as to the quality of houses including materials, fittings, and finish, erected by local authorities under the Acts of 1923 and 1924 during the last 18 months as compared with previously."
  The following interesting reply was given by the Minister of Health:
  "For some years specifications have been entirely a matter for the local authorities, and I have therefore no detailed information of the subject, but on a number of occasions during the last 18 months my Department have been informed at interviews that improvements in specifications have been made, and these with such other particulars as are available indicate that local authorities generally are fully alive to the importance of maintaining and improving the average standard of construction previously observed in houses erected by them."—[OFFICAL REPORT, 18th July, 1929; col. 644, Vol. 230]
  Therefore, there is not a word of truth in the allegation that the cost of these houses has been brought down by bad materials, bad specifications or bad finish. The Minister of Health is witness to that statement. If you take the small reduction in size in relation to the cost of the house and the small reduction in wages and cost of material, and make a very generous allowance, you can account only for a reduction of £37 10s. What are the facts? So far from the local authorities having been prevented from getting on with their schemes in consequence of the wicked scheme of reducing subsidies, the result of the cutting down of the subsidy has been that the price of building a house has been reduced to £339, and we have been building houses at the rate of 166,000 a year. [An HON. MEMBER: "That includes non-subsidy houses!"] Why should they not be included? Does anyone challenge that? In addition to that fact, the local authorities are much better off from a financial point of view in being able to give their orders.
  I will bring my remarks to an end by saying that if the Minister of Health can end up with a record such as that which I have described, we shall be the first to congratulate him. What is the posi-

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  tion? What is the record which my right hon. Friend the Member for Edgbaston has left behind in relation to housing? My right hon. Friend has restored private enterprise, and a great building industry has been built up. The supply of building materials required for housing purposes has been multiplied many times, and the number of men who have entered the building industry has increased steadily, and, so far as the house-building programme is concerned, not only during the past 4½ years has there been a record established in house-building for this country, but it is a record which has not been exceeded by any other country in the world.
  Sir J. TUDOR WALTERS: I think it would be a truism to say that all subsidies and all tariffs are contrary to rigid economic principles. Consequently, there must be some sound reason given why we should depart from those principles and adopt subsidies. I have listened with great interest to the discussions of this subject, and, although every party represented in this House has been responsible for subsidies, we are not quite satisfied yet whether they are good or bad. On this question, my memory goes back to the commencement of 1919, when I was associated with the Parliamentary Secretary to the Board of Agriculture in passing the Housing Act which has been the foundation of all modern housing, and which for the first time imposed upon local authorities the obligation to provide houses for the working-classes. When we came to consider the question of building houses, we found that it was a proposition which would not pay. At that time, the output of building materials was very small, and the building of houses was an unattractive proposition. Consequently, we had to depart from sound economics by granting inducements to people to build houses. What did my right hon. Friend the Member for Swindon (Dr. Addison) do? He fell back upon the subsidy. After that, the Labour party came into office; they wanted to accelerate still further the building of houses, and the measure they adopted was to increase the subsidy. One thing is quite clear, and it is that, whether subsidies be good or bad, they have in fact produced the houses. I think the record of house building during the past few years is a magnificent one,
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  and I can conceive no such achievement as this in the social progress of any other country.
  What has been the cost of these houses? It is true that we have secured the houses at a very great cost, and it is only natural that we should ask why house building has been so costly? Why have the figures in the case of ordinary houses soared to such unprecedented prices? I am bound to say that I think subsidies have had something to do with that state of things. At one time, I was associated with the Government's house-building programme until I was forcibly removed from that position by the election of 1922. Since then I have been devoting myself to the actual building of houses, and I have been the chairman of a great working-class house-building trust which has erected 20,000 houses since 1922. We have adopted every conceivable method of building. I would like to point out that the association with which I have been connected has been a nonprofit earning association. It has paid no dividends. Perhaps that may commend itself to hon. Members opposite, and they will not be inclined to regard me as a profiteer. We have adopted every conceivable method of house-building. We have built houses by direct labour, buying our materials in large quantities for cash. We have also built our houses under sub-contractors, and by the orthodox method of the all-in contract. I have kept a detailed account of all these transactions, and therefore I am in a position to tell exactly the cost of the labour of every house, and what the materials cost. I have spent some time in examining these figures. I have come to some conclusions in relation to the subsidy, and, if I am not taxing the patience of hon. Members, I will venture to give a few instances.
  There is this great question of supply and demand which we have talked so much about. Of course, if the demand for house-building is greater than the supply of materials, and the labour available, then up go prices, because there would be more people wanting to buy than there are sellers of houses, and consequently prices must rise. That was the difficulty of my right hon. Friend the Parliamentary Secretary to the Ministry of Agriculture who has been blamed so much because the price of the houses

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  under his scheme soared up. He found that there were not sufficient supplies of materials and labour and soaring prices resulted. The Minister of Health was quite correct when he said that a larger demand for houses sends up prices. When a subsidy increases the demand for houses, it therefore puts up the prices. That ought not to be allowed to go on indefinitely. If the arguments of hon. and right hon. Gentlemen who believe in Safeguarding have any substance of truth in them, a larger production means cheaper prices; the more of a particular commodity that you produce, the lower the price should be.
  It would seem to follow from that argument that, as soon as you have established a full and adequate supply of materials, and a full and adequate supply of labour, the more houses you build the cheaper they ought to be, and I think there is some substance in that. At any rate, my own experience is that, if I ask for tenders for 500 houses, I get them at a much lower price per house than if I asked for tenders for 100 houses, and that, if I am buying 10,000,000 bricks, I buy them much more cheaply than if I am only buying 10,000. Therefore, I do not think that the supply-and-demand argument has been quite correctly applied during this discussion. When you get your demand stabilised and your supplies equivalent to it, that is to say, when you get a regular building programme—not 100,000 houses this year and 200,000 the next, but a regular building programme—you will get a better output of houses at lower prices. One of the reasons why the price of houses soars and does not come down as much as it ought is that we have not rationed our house-building, that we have been too irregular, and have not stabilised the market. Therefore, if I discover that, with a large building programme, with a full supply of materials, and plenty of available labour, prices are not coming down, there is something wrong, and I want to know what it is.
  I have looked into that question with the greatest possible care, and have come to the conclusion that the subsidy has something to do with it. I will explain why I think that that is so. If you put a boom, which I think is the correct nautical term—a barrier—across a tidal river, you prevent the water from falling
  964
  to its natural low level, and a subsidy is something like such a boom across building trade prices; it seems to prevent them from falling to the lowest possible level. If I were asked why that happens, I would say that I imagine there is something in the psychology of the matter. An hon. Member of this House, speaking the other day, said, in connection with house-building and the subsidy, "All the builders want a bit out of it." That throws an interesting sidelight on the condition of affairs. You have your local authorities and your public utility societies arranging their building programmes, and devising the particular schemes that they will carry out; and, in making their financial adjustments, they know that, in addition to the rents they will receive from the tenants, they will receive another rent, namely, a subsidy from the State. That, I think, tends to less economy in administraion, and I think that the contractors, and builders' merchants, and builders generally, feeling that there is this State money—easy money, as they call it—will exact the maximum prices possible.
  I do not want to weary the House with detailed figures, and, therefore, will merely put my conclusions. After careful examination of these figures during the past eight years, I have come to this conclusion as to the effect of the subsidy on prices—it is often exaggerated, but it is very real and very definite—that about one-half of the capital value of the subsidy goes into the pockets of the building material merchants, the contractors and the workpeople, and that only about half the subsidy ever inures to the benefit of the tenant. That is my considered opinion. My financial experts who have been working with me say that two-thirds of the capital value of the subsidy goes as an endowment to the building trade, and only one-third goes to the tenant. I think that that is an exaggeration, but I do think it is a fact, and an unfortunate fact, that, while we are spending all this money, something like half the capital value of the State subsidy forms a permanent endowment for the building trade in its various branches. How is this to be prevented?
  We cannot look at subsidies in an abstract, dispassionate light to-day, as though they were not in existence. A certain position has been created, and, if the subsidy were to be withdrawn

  965
  to-morrow, down would go the output of houses, inevitably. You cannot, by the nature of present conditions, get your houses without a subsidy; let us make up our minds to that. But are these conditions permanent? My memory goes back to a housing scheme which I carried out many years ago, before the War, as chairman of the Leicester Corporation Housing Committee. It was one of the half-dozen housing schemes that were carried out under the Act of 1890. I remember that, when we built those houses, we borrowed all the money at 3 per cent. interest. If I had to carry out a scheme to-day—say a scheme in which the cost of the houses, all in, was £400—I should have to borrow that money at 5 per cent. If I could borrow it, as in the case of the Leicester scheme, at 3 per cent., I should save £8 per house, or 10s. more than the subsidy. If the interest charges could be reduced by 1 per cent., that would mean a saving of £4 per house, and I think that that would be of as much benefit to the actual tenant of the house as the full £7 10s. subsidy.
  There is another aspect of the question, namely, that of rating. I have had taken out the figures for the rates that are being paid on the 12,000 houses in colliery villages which have been built under my supervision during the last six years, and I find that the rates range from 2s. 6d. per week, or £2 10s. per annum, to £15 per annum. Actually, in the case of some of these cottages, the annual rates amount to £15, the average being about £10. If my Conservative friends, in their benevolent desire in connection with de-rating, had been less affectionate towards the so-called producer, and had included working-men's dwellings in their de-rating scheme, if they had given us 75 per cent. off the rates of these houses, they would have given us a sum of money which would have amounted to more in real value than any subsidy, because—and I want to emphasise this point—the whole benefit of reduction of rates goes into the pocket of the tenant. No profiteer comes between, no trade comes between, so that the tenant of a house is better off with a £3 15s. per annum reduction in rates than with the present £7 10s. subsidy. In the United States of America they realise that that is the case, and, in their attempt to supply the shortage of houses there, they have given the most
  966
  generous abatements both on local rates and on State taxes, and they have found that they have got all the houses that they want without any cash subsidy of any kind. I think it would be very desirable if we were to turn our attention just now, when we are beginning to realise the cost of the subsidy, to getting cheaper houses than under the subsidy by a generous measure of cottage de-rating and by a better management of the finances of the country by right hon. Gentlemen who now occupy the Government Benches, so that the cost of borrowed money may be considerably less than it is.
  There is one other direction in which I think there is some hope. I do not think we have reached finality as regards the cost of building, I do not know whether the House realises how entirely new are the methods of building that we have been adopting. The old-fashioned pre-War methods were entirely different. They did not produce such good houses, but they did produce houses at very low rates. We are now trying, and I think rightly, to do better, but our methods are as yet untried, and there is a great deal of room still for reduction in the cost of building without in any way decreasing efficiency. Take the production of materials. I have tried this myself, and I find that I can make bricks more cheaply than I can buy them. I have made some millions of bricks, although I had no previous experience. Indeed, I find that in a great many things of which I have had no previous experience I can do better than the experts. The reason for that seems to be that the tendency of the amateur is to simplify the methods of the expert. We have not yet solved the problem of the production of materials. The real reason why materials are so dear is because they are produced in such insignificant quantities. A large output of materials will mean very much cheaper costs.
  Then there is the question of building methods. The clumsy methods employed by some of my friends in the building trade appal me. You could not run a factory in that way; you could not run any business in that way. Consider the number of men who come and look at a job and go away to think about it, the number of unnecessary foremen who have elaborate consultations and get no

  967
  "forrader." What is wanted is a real live reorganisation of the building trade. I have managed to get some four or five firms working with me during the last few years who can turn out twice as much as the ordinary contractor. I want to see the workmen in the building trade getting good wages and providing plenty of houses, but I do not want to see so much overlapping as there is in the building trade; I do not want to see so many men coming along and doing small sections of a big job; I want all the work well organised. I do not want to see any kind of sweating, or depriving the men of the full opportunities of their industry, but I am entirely satisfied that, with a proper reorganisation of the supplies of materials and of the actual work of house-building, very substantial progress can be made. I am trying now to get, and I think I shall succeed in getting, very good houses built at a cost of, not £340, as mentioned by the right hon. Gentleman the Member for West Woolwich (Sir K. Wood), but £260. What I want the local authorities to do now, or at any rate during the next 12 months, is to set to work and give us cheaper houses. That is what the people want, and I do not think that this House or the country would grudge a subsidy, even a larger one than at present, if it did not go into the pocket of the builder, but if it went to provide cheaper houses for the poorer sections of the community.
  Mr. HAYCOCK: May I ask what is the superficial area of the houses to which the right hon. Gentleman has just been referring?
  Sir J. TUDOR WALTERS: They are A. 3 houses.
  Viscountess ASTOR Viscountess ASTOR rose—
  Sir J. TUDOR WALTERS: I am talking about broad general principles, nut from any political standpoint.
  Mr. SPEAKER: I ought to tell the right hon. Gentleman that if he is basing his argument for or against a subsidy he is in order, but that a general Debate on housing would not be strictly in order on the Third Reading of this Bill.
  5.0 p.m.
  Sir J. TUDOR WALTERS: I will abide by your Ruling, Sir. You have given me a very free hand, and the prisoner in the dock has managed to say some of the things he wanted to say. I should
  968
  like to say one or two words on some of the administrative details as set out in the Bill. I notice there is a larger subsidy for rural houses. I want to emphasise the importance of doing something for the housing of the agricultural labourer. My first emphasis was upon cheap houses for the town dweller, and I should like to expand that on some future occasion. When I compare the amount of money paid in subsidy for urban houses and the relatively insignificant amount paid for the rural housing, I at once realise how neglected rural housing has been. I should like to see the Minister of Agriculture, in co-operation with the Minister of Health, take up the building of 100,000 houses for farm labourers. I think I could show him a scheme under which they could be let at half a crown a week, including a nice garden, not weekend dwellings, but for the bona fide worker on the land. They could be built by the county councils. They should not be tied to any farm or farmer. A hundred thousand houses of that kind with good gardens at an all in rent of half a crown a week would be an incalculable boon to the agricultural labourers. They are a very much neglected class. I have spent my life largely in agricultural districts and years ago I was a landowner. Thank God I got rid of it, but I have still intense sympathy with the agricultural labourer, and I think the Labour Government would earn gratitude for itself if it took up the work that previous Governments have neglected and house agricultural labourers.
  I support the Third Reading. I believe that, although a subsidy is an extravagant method of achieving the house-building programme, up to the present it is the only method we have before us. We should turn our thoughts in the direction of revising our methods of getting cheaper money, and taking the burden of rates off the cottage dwellings and that, with a proper reorganisation of the building trade, would make it possible for us to obtain good dwellings for an economic price at a rent the tenants could afford to pay. But that time is not yet and, until it comes, the House must, I think, if it wishes for the provision of houses to be continued on an adequate scale, support the Third Reading of the Bill.
  Mr. TOM SNOWDEN: I have listened to the speeches on this question with considerable interest and a certain amount of instruction. It is somewhat unfortunate that I should have to speak after such an eloquent and instructive address and it would be unseemly on my part, as a new Member, to say anything that could be construed to be a lecture to the House. It is only because, like so many other Members, I have had some interest as chairman of a local housing committee that I venture to make a few observations. It seems to me that, if we are going to get the best out of this or any other Measure, the first thing we have to try to do is to give each other credit for being sincere. Although we may differ from the point of view of others, surely on this all important question co-operation is far better than recrimination. I am not, therefore, going to say anything, I hope, which will savour of lecturing. It is all a question of policy and the expenditure that is incurred in pursuing that policy. My experience has been that it is far better to get the idea that the development of our social services does not dissipate wealth but creates it, and it is the desire to try to get the best out of that that has prompted me further to make these few observations. We have a false idea of values. There are a good many Members present who have spent considerable time in local administrative work who are growing tired of us spending our time and our means in trying to deal with effects instead of removing causes, and it is because we want to remove these causes that we are supporting this Bill. I cannot help but think that in every quarter of the House, having regard to the circumstances of hundreds of thousands of people, we want to sweep this scourge away for ever. I do not care who gets the credit for introducing a Bill or for making a contribution in whatever form, if it will mean a mitigation of this social evil. I heard a speech last week from the hon. Member for Withington which did me good, because he seemed to find it in his heart to give credit to others, although it was not his own particular party, for having made a contribution in 1924. If we can pursue it in that light we shall get somewhere. There was a speech made by another Member to which I should like to take exception, because
  970
  he seemed to deplore the fact that the subsidy would mean unnecessary expenditure. The hon. Member for St. Albans (Lieut.-Colonel Fremantle) said:
  "There appears to be either ignorance or indifference to the housing question, or else there is an ignorant defence of it regardless of the amount of money spent, to which we are opposed."
  This is the point that rather distressed me.
  "We medical officers of health urge as strongly as we can that the Treasury should reduce the vast sums which were spent by the late Government upon housing in order to provide more money for other important health services which are calling out for treatment.—[OFFICIAL REPORT, 15th July, 1929; col. 102, Vol. 230.]
  I regretted to hear that speech because, if the subsidy will encourage housing—and I believe it will—it will remove evils caused by bad houses and, in consequence, reduce possible expenditure on the other matters to which the hon. Member referred. If it will do that, we ought, without the slightest hesitation, to do whatever we can to remove the causes which are responsible for the things which, no doubt, the hon. Member had in mind.
  Lieut.-Colonel FREMANTLE: I only said it was an extremely extravagant way of doing it.
  Mr. SNOWDEN: It is rank waste to have to spend the money we are doing caused directly by bad housing. [Interruption.] If he agrees with it, surely the hon. Member will support the Bill and encourage us to build houses, even though the subsidy will mean a certain expenditure. It is better to spend it on housing than have to spend it in building hospitals.
  Lieut.-Colonel FREMANTLE: The whole point is waste. So far as it goes to improving housing, we are all in favour of it. I only pointed out the wastefulness of it.
  Mr. SNOWDEN: I differ from the hon. and gallant Gentleman and I should like to think he does not represent the views of other medical officers of health, or even of the medical profession. At any rate, it would not do for the medical officer in the West Riding of Yorkshire to adopt the views expressed here. At any rate, I will not enter into a controversy with the hon. and gallant Gen-

  971
  tleman. I have not said it in that spirit at all. I feel confident, from my experience in Lancashire, that it is only a question of proportion and we are satisfied that, because it was announced to the country that the subsidy was to be reduced, and finally abandoned altogether, local authorities in the towns and cities were reluctant to proceed on what they might call their larger schemes. Like other Members, I do not care for subsidies. I do not know anyone who does. A subsidy to me is something in the nature of a bribe, and I am not so sure that those for whom the subsidy is intended receive it, but until we have decided on safer and better ways of dealing with the matter at the source, in respect of the land question and other things that could be mentioned, which I should not be allowed to develop at this juncture, we are compelled to face the situation as it is and offer something in the nature of an inducement to get along with this important matter.
  The withholding of the subsidy, the withholding of anything in the nature of an inducement, whatever it might be, means a continued poverty of body, mind and soul to hundreds and thousands of men, women and children in this country. The right hon. Gentleman the ex-Parliamentary Secretary to the Ministry of Health said that the prospective tenants would have to pay increased rents in consequence of the subsidy and other things. I would remind the right hon. Gentleman and hon. Members of this House that in the small towns, and more particularly in the larger towns, there are scores of families living in rooms, in attics, and even in cellar dwellings who are paying more than 8s., or 10s., or 15s. a week. They are paying as much as £l a week for rooms in houses and would be much better off paying 8s. 6d. or 10s. a week for houses that are subsidised. They are living in rooms with miserable facilities and are impairing the health not only of themselves but of the other occupants of those houses.
  Is it not worth something to have a subsidy for slum clearance? Those who have known what it was to have been brought up in a small back-to-back house, amidst a large family, and who now enjoy better housing facilities ought to
  972
  find great joy in making contributions, either in taxation or in rates, to enable less fortunate ones to enjoy the facilities which they themselves enjoy. The right hon. Gentleman the Member for Penryn and Falmouth (Sir J. Tudor Walters) suggested that there was not much altruism in the building or in any other trade or business. Let us admit frankly that there is not, but there is a desire to build houses which this Bill will encourage. I believe that the people in the country generally will be prepared to pay the cost that will be incurred, and will find great joy in it because of the fact that they are tired of merely preaching and teaching the need for better housing conditions, better opportunities, and giving to men and women a better outlook in life. It is far better that we should do that and know that we have made a contribution to the solution of this problem than dream by day and by night and never do anything. It is because I feel very strongly that something can be done on these lines, that I hope that this Bill will pass the Third Reading and that we can anticipate eventually a more comprehensive Measure that will enable us to express ideals of which we are not ashamed even in this House. I, therefore, support this Bill with a considerable amount of interest, knowing, as I do, that if we can get continuity and encouragement from this Bill we shall get to business in cur respective spheres, in our towns, villages and cities, with the object of sweeping away for ever the bad social conditions which are a disgrace to civilisation.
  Miss RATHBONE: I claim the indulgence which this House always extends to a Member who addresses it for the first time, but I cannot claim indulgence as a novice on the housing question. For the past 19 years I have been a member of the Housing Committee of the Liverpool City Council, one of the local authorities which has been, I think, most active in the matter of housing both before and since the War. In that way, I have had considerable opportunities of observing the effect of the various changes in Parliamentary policy on the action of the local authorities which have been controlled and guided by Parliament. The present Debate is limited to the question of whether His Majesty's Government are right in continuing the subsidy at the present level. I have noticed that prac-

  973
  tically the whole of the Debate that has taken place has turned upon the question of the effect of the subsidy in two respects. First, on the cost of building, and secondly, on the number of houses that are built with the aid of the subsidy. Upon those two questions I will not intervene, but surely there is another factor which affects the question of whether we want the continuation of the present subsidy, which so far has hardly been touched upon. That is the question whether this subsidy will assist in the production of houses which will meet the need of those who cannot pay economic rents. After all we do not pay subsidies for the sake of houses. We pay subsidies for the sake of tenants, and not for all tenants, but for those who are incapable, without the aid of the subsidy, of providing suitable housing accommodation for themselves. If there were not such tenants we should still need a housing policy for town planning purposes, but we should not need housing subsidies.
  Practically every speaker has assumed that the whole question, or almost the whole question, is to secure a continued, and, if possible, a steady supply of that admirable type of houses with which we have all become so familiar—those three-bedroom houses, with or without parlour, with their little gardens fore and aft, which are spreading themselves round every industrial centre in a broad zone, like a sort of milky way, houses that are a refreshing contrast to the dingy rows of brick boxes, with slated lids in which the great majority of the wage earners have hitherto been compelled to be housed. I agree that we do need a practically unlimited supply of those houses, but I agree with one proviso, namely, not at present rents. The question of rents is vital because it determines who will benefit from the houses, whether the houses will benefit those suffering from the housing shortage most acutely and suffering from it longest, and least by their own fault. The question of whether such persons can enter the new houses depends upon the rents at which the houses will be rated. The rents at present vary according to the type of the houses, according to the variations in building costs of the locality and according to the variations in rating in the locality, from about 8s. to 24s., or even more in London. But for the three-bedroom, kitchen house, which we all
  974
  recognise as the most needed type of house, I believe the average rent, taking the country over, is about 13s. The Housing and Town Planning Association have recently calculated as one result of rather an exhaustive consideration that the cost of that type of house might be reduced to a minimum of something like £400, and that at that price, with the aid of the subsidy and with rates averaging 40 per cent., it could be let for 11s. But there seems no prospect of a reduction either in minimum cost below £400 or in rent below 11s.
  The point I want to impress upon the House is that houses at 13s. or even at 11s. are not going to meet the really acute housing need. Who feels that need? Surely those who are at present living either in overcrowded houses or in structurally insanitary houses. Is our present policy doing anything at all appreciable to relieve the need of those two classes—the dwellers in the overcrowded and the structurally insanitary houses? The hon. Member for Withington (Mr. Simon), who spoke the other day in the Debate, has recently produced an admirable little book, which, I hope, everyone interested in the housing problem will read, called "How to abolish the slums." The hon. Member for Withington has shown himself an enthusiastic advocate of subsidies, and of this particular subsidy, and yet the very words with which he began this book are:
  "We have built over 1,000,000 houses since the War. We are well on the way to solving the housing problem so far as the clerk and the artisan are concerned, but we have done nothing for the poorer workers. The condition of the slums in which they are forced to live is probably worse to-day than it was at the end of the War. The overcrowding is almost certainly no better, and the condition of houses is now certainly much worse."
  That startling statement cannot statistically be proved until the census of 1931 is to hand. I do not think anybody who has practical experience of the housing problem in great cities will doubt its truth. I have not forgotten that the present Bill does not pretend to contain the complete housing policy of the Ministry, especially its policy with regard to slum clearance. We must wait for that until the autumn, but before accepting a Bill the object of which is to keep on the subsidy at the present rate—and, as the

  975
  right hon. Member for Penryn and Falmouth (Sir J. Tudor Walters) said, there is no indication that the autumn Bill is intended to raise the subsidy—we are surely entitled to ask, whom are we supplying? Otherwise, when the Slum Clearance Bill makes its appearance and when some of us propose Amendments and extensions to that Bill, we may be told: "That would be very nice, but the country cannot afford it." We shall find that we have spent so much money on the slighter and less pressing needs that there is none left for those who need houses the most. It is no use clearing away slums if there are no houses provided at rents within the capacity of the slum dwellers. It has been said that this is only a small Bill. It will only prove small if it fails in its object of increasing the supply of houses. The Financial Memorandum estimates that if 100,000 houses are built in a year under the Bill the additional cost will be £150,000, but, as the Parliamentary Secretary pointed out in reply to the hon. Member for Withington, that is a mere arithmetical platitude. The Bill concerns a difference in the amount of housing subsidy of 30s. per house. Therefore, if 100,000 houses are built in a year, the extra cost will be £150,000, and if 200,000 are built in a year the cost will be £300,000. That is the direct cost. In considering the real extra cost which the Bill is going to place upon the Exchequer, we must add the capitalised value of £6 per annum for 40 years, multiplied by the number of houses that would not have been built if the Bill had not been passed. As no one can compute that, it is easy to represent it as a small Bill.
  I am not opposing the Bill, but I would ask whether a Government which represents the party which considers itself specially the party of the under-dog cannot take some steps to secure that the money that we are providing through this Bill and through previous Bills, or at least some portion of it, shall benefit those lower paid workers who cannot afford the present rents? It is quite possible to do that under present legislation, through administrative regulations and through the influence of the local authorities. The crux of the matter is that the local authorities have assumed that because
  976
  the subsidy is placed on the house, so much per house, it necessarily follows that the subsidy adheres to the house and must be used to lower the rental of the house by a flat rate amount equivalent to the amount of the subsidy. If the object of the subsidy is to provide for those who cannot pay an economic rent, it ignores the fact that capacity or incapacity to pay an economic rent is a personal factor, which does not adhere to the house but adheres to the tenant. Moreover this factor varies in the tenants. It is not merely a question of the prudent people who are going to be housed, or whether they are slum dwellers, or whether a proportion of the houses are in a particular locality, but what is the occupation of the people who are housed and what are their wages.
  There has also to be met this factor, that the capacity or incapacity of an individual to pay an economic rent varies according to the number of people who have to live on his wage. Take a man who is a municipal employé, earning the standard rate of wage for such labour of 50s., and assume that he has three children, who are nearly finishing at school. What is that man's capacity to pay rent? About 6s. a week, allowing for the barest necessities and the lowest standard of life for the family. Wait, however, for three years, when all his children has entered the labour market and has become an asset and not a liability. In those circumstances, his capacity to pay is 15s. or 17s. a week, which would enable him to take advantage of the present type of house. The result of deducting the subsidy from the amount of the rent on a flat rate basis is that the rents are lowered by 3s. 6d. all-round. What proportion of the would-be tenants of municipal houses would be able to pay the economic rent value of the house, reduced to the precise extent of 3s. 6d. a week, neither more nor less? I should say that it is a very small proportion. Of those who need houses most sorely, nearly all of them living in insanitary or overcrowded conditions, the great majority cannot even think of entering into a corporation house, because the difference between the rent charged and the economic value of the house and their capacity to pay cannot be bridged by a mere 3s. 6d., or anything like it. Of those who do enter the houses, a con-

  977
  siderable proportion pay the rent by pinching it off the food bill, while to others who do not need the 3s. 6d., it is a mere addition to their pocket money.
  With respect to the subsidy of £75, or later £50 paid under the Chamberlain Act, my experience is, and I suppose it is the experience of most housing authorities, that when the buyer of the house—the houses built by the aid of the Chamberlain subsidy were invariably sold—entered the house, he almost invariably applied to the local authority for leave to put up a garage, in order to house the motor car on which he had set his heart. A very laudable ambition, but is there not something wrong with a housing policy which for 10 years has been pouring out millions of the nation's money in aid of housing for people who can afford to keep motor cars, and has done practically nothing to relieve the 10 per cent. of the whole of the population who, according to the returns of the Registrar General, are living under a miserably inadequate standard of housing, and in overcrowded conditions?
  I believe that the error in the past has been in the method of applying the subsidy. It ought never to have been used for a flat-rate reduction of rents. It would have been far better if the local authorities had fixed the rents—I know that I am enunciating a heresy in the view of most people here—at the economic value of the house, and had then used the subsidy according to principles clearly laid down and carefully thought out, to relieve the needs of those who most needed housing relief, those who were living in insanitary or overcrowded conditions, those who were suffering—there are many who cannot be even touched under the present subsidy arrangement—from infectious tuberculosis, affecting those crowded together with them in one-room tenements; those bringing up young children and whose wages for a temporary period are dragged down by the cost of rearing their children. It is quite possible, even under the present Statute, to meet the needs of these classes. I believe that it has been done to some extent by certain small authorities, such as Banbury, Rotherham and others, which have adopted the plan of making a rebate off rent of 6d. for each child, balanced by 1s. on the rent for each lodger.
  978
  It may be said that these look like trumpery schemes, but proud municipalities such as Birmingham, Liverpool and the London County Council need not be ashamed of taking a lesson from small municipalities. There are very few great social experiments in this country that have not begun on a small scale in obscure places and by obscure people. When we have once departed from the economic basis of rent, what is the use of ignoring the factor that incapacity to pay is a personal thing and does not attach to the house, but to the tenant? I suggest that the Ministry, while thinking out their big slum clearance policy, should give every possible encouragement to local authorities to use their subsidies in the way I suggest and get rid of the idea, for which I believe there is no basis in the Statute itself, that because you give a subsidy to aid in the building of houses you need to spend that subsidy on a flat-rate reduction equal over all houses. Why should they not use the subsidy in the form of rebates of rents for children? The principle is not new. There is not one hon. Member in this House who is entitled to it who does not accept from the Chancellor of the Exchequer the rebate on his Income Tax in respect of his wife and the number of his children. The principle is extraordinarily easy to apply. While there may be administrative difficulties in the rebates on rents based on income, because it is possible to misrepresent or conceal your income, it is practically impossible to conceal or misrepresent the number of your children. A baby is the most easily provable fact in existence.
  May I make a suggestion which is not irrelevant to the purpose of the Bill? It has been repeatedly pointed out that this is a marking-time Bill, to give the Ministry time to consider and bring forward their bigger schemes. Is not the House justified in suggesting that they should be allowed to consider the policy of the future with His Majesty's Government, through a Select Committee? We have had ample evidence from this Debate that the ex-Minister of Health and the ex-Parliamentary Secretary to the Ministry of Health and the present Minister of Health and the present Parliamentary Secretary to the Ministry of Health, have arrived at precisely opposite conclusions as to the effect of the

  979
  subsidy on the cost of building and the supply of houses. Presumably, they have had precisely the same data to consider. Why may not the House bring its collective wisdom to bear upon the same problem and have an opportunity of considering the data, not merely with a view to determining the effect of the subsidy on the supply and cost of houses, but the much larger question of the effect of the subsidy on the kind of rentals and the kind of tenants; the practicability of the slum clearance scheme, which will be useless unless we have houses in which the dispossessed people can be put; the limits of the possibility of reconditioning, to which ex-Ministers are known to attach much greater practical importance than many of us who have been long thinking of that method believe it will have; the possible effect of the Kent Restriction Acts upon the housing problem, and also the effects of transport facilities upon the housing problem?
  During the closing years of the War, I think there were nine committees appointed to discuss various aspects of the housing problem, but they were nearly all of them content to consider the structural aspects of the housing problem, the cost of building, the type of houses, building materials, labour supply and so forth. Now, after the lapse of 10 years, I suggest that we want a Select Committee to consider the housing problem from the tenancy side, to see how we can manage to put up enough houses and to see that those houses pass into the hands of those whose housing needs are the sorest. At present our housing policy may be compared to our having built, at vast cost, a reservoir intended to relieve the thirst of people who are dying of thirst, and then allowing the first call on the water to go to those who need water only for the watering of their roses.
  I thank the House for the patience with which it has listened to me, and I am glad that the first occasion on which I have had the opportunity of addressing the House has enabled me to express an opinion which, whether it be a right opinion or a wrong opinion, is the fruits of nearly 20 years of theoretical and practical study of the housing problem, and which has led me to the conclusion that while our study of the housing problem for 20 years, even our pre-War
  980
  housing problem, has been honestly and painstakingly applied, and has done much good, it has done far less good than it might have done, because it has been vitiated from the first by the economic fallacy that, when you are dealing with a State benefit, which is certainly limited to a comparatively small number of people, because you cannot subsidise houses for the whole population, you can best use that subsidy by a flat-rate reduction of cost; all-round. The problem of incapacity to pay an economic rent is a personal problem and can never be solved, whatever the subsidy may be, by so mechanical a device as a flat-rate arithmetical equal reduction of rent by the amount of the subsidy upon the houses built by the local authorities.
  Dr. VERNON DAVIES: It is my duty and my privilege to express our deep appreciation of the speech which we have just heard from the hon. Member for the Combined English Universities (Miss Rathbone), a Lady who has come to this House with a very well-deserved reputation in social and housing questions, and a reputation which, I am sure, will be enhanced by the speech which she has delivered. I can assure her on behalf of the House that we shall always be pleased to listen to her, although, perhaps, we may not always quite agree with her. The question before the House is one of vital importance to the people of this country. The housing of the people is not a political question, and this House is to be congratulated upon the tone of the Debate, because on all sides there seems to be a general desire to see that houses are built, and built at an economic rate. The very fact that we have had two Housing Acts, one in 1923, a Conservative Act, and the other in 1924, a Labour Government Act, running side by side throughout the years is distinct evidence that this House is determined that the matter shall not be a political one and that the two classes of houses shall have a fair trial.
  The question we have to decide to-day is between two theories. One is the theory of the late Minister of Health, who after great consideration and as a result of his prolonged experience came to the conclusion that a subsidy has a distinct effect upon the cost of houses; that if the subsidy is raised there is a tendency for the cost to rise, and, on the other hand,

  981
  if the subsidy is reduced there is a tendency for the cost of houses to be reduced. If there is one thing necessary to ensure a sufficient supply of houses at an economic rent it is that they should be as cheap as possible. It seemed to me that the late Minister of Health was on the right lines, and I approved and supported his policy throughout the last Parliament, At the beginning he said that it was an experiment. His theory was that the subsidy had a distinct effect on prices, and that if he reduced it a little he would expect to find a fall in prices. Although hon. Members opposite strongly criticised and ridiculed this view, and prophesied that he right hon. Gentleman was wrong, the facts simply proved that he was right. The number of houses built increased in number, and decreased in price; and decreased by more than the fall in the subsidy. When anyone makes a prophesy, acting upon a theory, and the prophesy comes true, there is fairly good evidence to suspect that the theory may turn out to be true, and I supported my right hon. Friend when he further reduced the subsidy in the last Parliament, because what I want, and what I am sure every hon. Member wants, is to produce a sufficiency of houses at an economic rent which the poor of the country can afford to pay.
  Now we have this Bill brought in by the present Minister of Health who takes the exactly opposite view. Although he will not deny that subsidies may have some effect upon prices he is not concerned so much with the matter of prices as with the building of houses. He says: "I want houses and as quickly as possible, even if I cannot get them cheaply." That helps the building of houses, but it does not help to build them at an economic rent which the people can afford to pay. Hon. Members must be puzzled to know which of the two right hon. Gentlemen is correct. Is the subsidy theory good or is it bad? We have had a remarkable speech this afternoon from the right hon. Member for Penryn and Falmouth (Sir J. Tudor Walters), whose knowledge and experience are probably unrivalled in this House and in the country. Every word he uttered must receive the very careful consideration of all hon. Members, and of all those who are interested in housing. When he deliberately makes the statement that he is convinced from his experience that
  982
  part of the subsidy goes to the builder and that the whole benefit is not going to the tenant in the lowering of rent, it is a point which we must bear in mind. If it is so it means that this Bill is simply going to put more and more money into the hands of builders and builders' merchants, or other parts of the building trade. It means that we are deliberately offering this bribe to the builders, and we are saying: "We will give you such and such a bribe if you will promise to build so many houses." Is that the policy of this House? Is that what this country desires? Are we to go on our knees to the builders and say: "Will you please build houses to house the poor people of this country? And if you do, we will give you a bribe for doing it."
  Mr. MacLAREN: That is what you did to the farmers.
  Dr. DAVIES: That remark brings up the question of subsidies altogether. During the discussions in this House on the coal subsidy I heard the strongest arguments used against it, and the greatest complaints made about it by the Liberal and Socialist parties. During the same Parliament I heard bitter complaints with regard to the beet sugar subsidy, and particularly from the Liberal party which opposed it for all they were worth. I understand that the policy of some hon. Members of the Liberal party has changed a little, and an hon. Gentleman, the Member for Withington (Mr. Simon) believes in the subsidising of families; thus giving a premium to fertility to the poorest classes in the community. If we are to give a subsidy, the question is how much we are going to give; and for how long; and whether it should or should not be passed on to the tenant. Are subsidies to help the building trade and the building rings, if there are such rings? I am making no accusation, but I am sure the idea of the Minister of Health and the Parliamentary Secretary is that any benefit from the State should really filter down to the tenant.
  Mr. MacLAREN: Or the patient.
  Dr. DAVIES: We are talking about housing. I am afraid the policy of the Government may not have that effect, but I am not prepared to vote against it for a moment because I think the question is more or less an experiment. I would like

  983
  to suggest to the Parliamentary Secretary that the Minister of Health has a sufficient amount of information in his Department to enable the House to come to a considered opinion, and when the scheme which is germinating in the brain of the Minister of Health comes to be considered in the next Session it might be well if a White Paper was laid before Parliament giving the whole arguments for and against a subsidy; what it has done in the past, and what it is expected to do in the future. This House could then come to a reasoned opinion with definite knowledge on the subject. If the Minister of Health is right in his theory it would be to his great advantage, and to the advantage of the country. If, on the other hand, it points in the other direction I am sure he is a big enough man to acknowledge it. I believe he is trying to do the best he can for housing, but this difference of opinion between two different theories leaves me to-day as undecided as ever I was.
  My belief up to the present time is that the late Minister of Health is correct in his theory and that the Government are making a grave mistake, but I do not go as far as to say that I am right. The arguments of the Minister of Health, from an economic standpoint, seem to me so higgledy-piggledy, so upset, that we are not in a correct position to form an accurate conclusion. It would be a great advantage if the Ministry of Health would issue a White Paper giving all the information and all the relative facts to enable us to form a conclusion. If, in the production of this White Paper, the right hon. Gentleman found that he was wrong, that his subsidy policy was retrograde, not progressive, then he would, of course, be compelled to alter the whole of his scheme, and it might alter the whole of his housing policy. I hope we shall have such information, any-how, as will enable us later on to come to a very definite conclusion as to whether a subsidy is right or wrong. If it is right, then how much it should be, and for how long it should continue; and is it to go to the tenant in the reduction of rent or as a bribe to the builder to help him to build houses?
  Mr. STRAUSS: I had intended to follow the excellent advice which my hon. Friends have given me to keep my ears
  984
  wide open and my mouth shut tight until I had been in the House some considerable time, but this is a matter on which I feel so keenly, and on which I have had a certain amount of experience as a member of the largest building authority in the world, the London County Council, that I intend to throw discretion to the wind and say a few words to the House. Comments have been made by previous speakers as regards the inadequacy of the subsidy in stimulating building in rural areas. I can say nothing about rural areas, but I do know That housing in London has not been proportionate, or anything like proportionate, to the demands for houses reckoned on a purely population basis. The proportionate number of assisted schemes which have been put up in London compared with those put up throughout the country is something like 12 per cent., while the proportion of population in Greater London as compared to the whole country is about 20 per cent. London seems to have suffered as well as the rural areas. I was much struck by a point made by the right hon. Member for Edgbaston (Mr. Chamberlain) when this matter was before the House on the last occasion. It struck at the kernel of the matter. The right hon. Gentleman said:
  "It is a question which I bate never been able to get a satisfactory answer, or indeed to get any answer at all from the party opposite. This is the question? 'How can a cut in the subsidy possibly force local authorities to reduce their rate of building unless it has had the effect of putting up the price to them?' "—[OFFICIAL REPORT, 15th July, 1929; col. 81, Vol. 230.]
  6.0 p.m.
  I do not like to rash in where angels fear to tread, but surely the answer is this: Local authorities are, of course, the authorities which carry out housing schemes. Until a few years ago they built very few houses, practically none. It is since the War that they have undertaken the building of houses after pressure put upon them by the Government; and they react very closely indeed to the attitude which the Government take in attacking the housing problem. When these subsidies were cut on the first and second occasion, there was strong opposition from local authorities. They were keen and anxious to go on with their building schemes, and a deputation from the County Councils Association and the Association of Urban and Rural District Councils waited on the Minister of

  985
  Health and asked him not to cut the subsidy. They wanted a bigger subsidy for building, and they were prepared to provide a bigger subsidy out of rates in order to go on with their housing schemes. The Minister cut the subsidy, with the inevitable result that there was a reaction in the housing activities of the local authorities; they slackened their schemes or stopped their schemes, because they felt that the central Government was not really as keen as themselves in dealing with the housing problem. It was a natural and psychological result. There may have been, as has been argued previously, a certain economic result, in the fall of prices, but it is certain that there was a definite human result in that fewer houses were built and overcrowding was consequently made worse.
  As regards London I have not exactly a criticism but a comment to make on this Bill, in that it does not really touch the kernel of the difficulty of relieving overcrowding in London. As a member of the London County Council I have every week families coming to me and asking me what I can do to get them out of their housing difficulty. They are probably living four, five, six, seven and even nine in one room. The father of the family may be perfectly well able to pay the rent which is demanded in the ordinary way for a house built under these schemes. He may be getting well above the average London wage, say, £3 5s. or £3 10s. a week. Sometimes the parents bring along a certificate from a doctor saying that it is absolutely essential that the children should be taken out into the fresh air for their health sake. Yet these people cannot, and will not, under this Bill, be able to get houses any more easily. Many of these men are ex-service men. It happens that one of the most famous V.C.'s in the War, Lieutenant Michael O'Leary, lives at this moment in my constituency, with a wife and five children, in a tiny little room, although he has recently been promised better accommodation.
  The crux of the matter is this: The man is willing to pay the rent. He maintains that he will be able to pay it. But his work is in London, and the houses which are available are all outside London. If he is to get a house he has to pay, on top of the rent, which he can
  986
  manage, a considerable fare, which he cannot manage. From the estate at Becontree, for instance, he has to pay a fare of 1s. 1d. or more a day. If there are several children over the age of 14, as there often are, not only the father, but the other children who are wage-earners also have to pay this exorbitant amount in fares. It is that which makes it impossible for the most overcrowded people in London to obtain houses in which they can live. I very much hope that when the Government's bigger scheme is brought forward in the autumn very serious consideration will be given to the essential matter of stopping the pulling down of houses in order that factories might be put in their place, and, even more important still, that provision will be made for the transfer of factories in London to the newer estates, by financial inducements if necessary, and that encouragement will be given to new industries to go to these estates outside London so that the estates can be changed from the dull dormitories that they now are into live and thriving satellite towns.
  As one who has been very closely in touch indeed, during the last few years, with housing in London, I welcome this Bill, and particularly the announcement that it is the forerunner of something greater in the autumn. I am sure that this legislation has brought hope to thousands of Londoners and, I suppose, to people in other big towns as well who had given way to despair. If the Government did nothing more than pass this Bill and the other larger Measure which is to come later, it would, on that alone, have more than justified its election to office.
  Mr. E. D. SIMON: I wish to congratulate the hon. Member who has just spoken on the very valuable and interesting speech he has made, especially in reference to housing in London. I want to deal with one matter which was mentioned by the hon. Member for the Combined English Universities (Miss Rathbone), and that is that the Bill will not provide houses for the poorest workers with the larger families. That is quite clear. It is a matter which, I understand, the Minister of Health proposes to deal with in a later Bill. None the less it is very valuable that the matter has been brought forward to-day. I want to deal this afternoon shortly with one point. I

  987
  am very glad to see that the right hon. Member for West Woolwich (Sir K. Wood) has returned to his place. The point to which I wish to refer is the main and fundamental question as to whose pocket the subsidy goes into. Will this extra 30 shillings go into the pocket of the builder or will it enable us to get cheaper houses? It has been erroneously stated that I have an affection for subsidies. I am very far indeed from liking subsidies for their own sakes. There is one thing that I want and care more about, and that is the building of cheap houses at rents that the workers can afford to pay. I put that first. If it involves subsidies, I am prepared to waive my objection to subsidieis. The question is whether or not subsidies are really an important factor in providing cheap houses.
  The right hon. Member for West Woolwich said, on the Second Reading of the Bill, that there were two bodies of opinion—one that held that the only way in which to get houses for the lower-paid members of the community was to pay an adequate subsidy; and the other that held that the sooner we got rid of the subsidy the better and the more quickly would houses be built. You could not have stronger statements on two differing points of view. If the right hon. Gentleman really felt that the sooner we got rid of the subsidy the better it would be and the more quickly would houses be built. Why did he not carry his convictions into effect when he had the power during three years? Why did he not wipe out the subsidy altogether and get the houses built more quickly?
  It really is an economic question, into whose pockets the subsidies go. It is extraordinary that in this House the opinion on this economic question seems to depend entirely on the party to which a Member belongs. Almost everyone in the Conservative party believes that subsidies do not enable you to let cheaper houses to the workers, but almost everyone on the other side of the House believes that they do. Suggestions have been made that a Select Committee or some kind of Committee should be appointed to consider the matter. I would almost like to suggest a Committee of economists to advise the Government where the subsidy goes. It is generally agreed that what we want is a house at
  988
  a rent of something like 10s.—not more than 10s.—for the artisan class, and then some very much cheaper house for those who cannot afford to pay that rent. What are the figures? Let me first quote the figures given by the right hon. Member for Edgbaston (Mr. Chamberlain) the other day. I will show by one set of figures how the subsidy under proper conditions affects the price.
  In December, 1922, the right hon. Gentleman said, the lowest price for the non-parlour house was £346. At that time there was no subsidy available; builders were practically in bankruptcy. In the first quarter of this year there was a subsidy available, a very large subsidy indeed, the capital value of which was no less than £187. If the right hon. Gentleman's figures were correct one would think that with a subsidy of £187 the price of the house would be very much higher. In fact it was nothing of the kind. The price in the first quarter of non-parlour houses was actually lower than in December, 1922, that is to say £339 compared with £346. If you take the capital value of the subsidy at £187, and deduct that from the £339, which was the cost of the house, you are left with the actual figure, on which you have to charge interest and sinking fund, of only £152. That is to say, that in the first quarter of this year the average non-parlour house was only £152, on which interest and sinking fund had to be charged. That was owing to a subsidy of £187.
  I would like to challenge right hon. Gentlemen on the Front Opposition Bench as to whether they really think that if that subsidy were abolished we could in some extraordinary manner start building satisfactory non-parlour houses for £152. Everyone knows that it is wholly out of the question. The most optimistic suggestion of my right hon. Friend the Member for Falmouth (Sir J. Tudor Walters) was that he could build them for £260, but he did not give the area of the house. It probably was something like that of some of the houses built in Birmingham, which are very small indeed and very much below what most people in this House would be prepared to accept as reasonable A 3 houses. The houses in Birmingham, I believe, are of 320 square feet, and are very much smaller than most of us would accept as reasonable houses, which are generally

  989
  put at 700 or 750 feet. Those are striking figures. I hope that the right hon. Gentleman will tell us how he is going to get a decent A 3 house built for £152, which is the actual average price, after deducting the subsidy, in the first three months of this year.
  Before deducting the subsidy the house cost £339, and the economic rent on that is 14s. After deducting the subsidy the economic rent is 10s. We have, therefore, by the gradual reduction of price and with a subsidy of £7 10s., now arrived at a position in which the local authority which builds economically and does not build unnecessary large houses, can let them at 10s. a week. That is a very great advance, and it should undoubtedly begin the process, which has not yet begun, of drawing families out of the slums into these houses, if you can build a large number of them. That is why I welcome this Bill. It means practically 10s. a week rent for these houses with a subsidy of £7 10s. That is a very great achievement. We can now, thanks mainly to the Act of 1924, hope to do this. The building trade has been expanding and is able to build 160,000 houses a year of a kind which the economical local authority can let at 10s. a week.
  I hope that the right hon. Gentlemen on the Opposition Front Bench will let us know how they believe it to be possible to let a house of that sort at 10s. without a subsidy. My right hon. Friend the Member for Penryn and Falmouth said there were other forms of subsidy such as reduction of rates and reduction of interest. I remember that in 1924 the right hon. Gentlemen the Member for Shettleston (Mr. Wheatley) said that under real Socialism there would not be any interest, and he would then let the houses at 3s. 3d., but that was a very fantastic calculation. If you like to give a subsidy in the form of a reduction of rates, it really makes no difference whether you do it in that way or the present way. The point is that either by a reduction of rates, or a reduction in the rate of interest, or by an actual subsidy of the present type—somehow, you have to bring that price down to somewhere in the neighbourhood of £150. I am very glad to know that nobody in the House wants to cut down the size of houses and therefore we are left with
  990
  this question. The price of £339 is not necessarily a minimum price. It might be possible to bring it down to £260 and the right hon. Gentleman would have the best of our good wishes if he succeeded in doing so. He would be doing a very good service if by means of mass production or in any other way he found it possible to achieve that result and it would be possible either again to reduce the subsidy to a certain extent, or to reduce the 10s. to 9s.
  I should like to say how much I agree with the hon. Member for the English Universities that it would probably be a mistake to increase the flat rate subsidy beyond the present figure. The right hon. Gentlemen the Member for West Woolwich taunted the Minister of Health with not increasing this figure to £9 and was good enough to assure him of my support if he did so. The right hon. Gentleman is quite wrong on that point because I think it would be the greatest possible mistake to put the subsidy back to £9 for the reason given by the hon. Lady. If there is any more money available I hope it will be applied not to increasing the flat rate subsidy, but in enabling local authorities to build much cheaper houses for those large families in the slums who cannot be drawn out of the slums in any other way. Taking into account land, drains and roads which add about £50 to the cost, roughly speaking the cost of a decent non-parlour house is about £400 which by the subsidy is brought down practically to the equivalent of £200. If the right hon. Gentlemen on the Front Opposition Benches believe that reduction of subsidy is the quickest and best way to get cheap houses, I hope they will explain by what means they propose to bring down the cost of houses from £400 to £200. That is the crux of the whole question and if they could do that, I would be in favour of abolishing all subsidies. But I believe it to be utterly impossible and for that reason I wholeheartedly support the Bill.
  Mr. F. RILEY: I have listened to a good many of the speeches upon this subject during this and the previous Debate on the Bill. I was particularly interested in the speech made last Tuesday by the hon. Member for Withington (Mr. Simon) who seemed to divert the discussion to the main problem of dealing

  991
  with those cases in which greater difficulty than the ordinary is experienced in paying the rents. I was also interested in the speech of the right hon. Member for Penryn and Falmouth (Sir J. Tudor Walters), because I remember his work 20 years ago. He expressed the hope that at a future date it would be possible to build houses at a price of £250 or £260. I wonder if he left out of account some of the influences which might be encountered in any such scheme as that. At the risk wearying the House, I should like to relate an instance from my own area. A parish council not 20 miles from London, two years ago instituted an inquiry and discovered that the housing conditions of a large number of the people were extremely bad. There was a very keen tussle with the parent body—the rural council—ending, as was perhaps inevitable, with an appeal to the Ministry and a public inquiry. The rural council were instructed to build houses and presumably those houses were to be built for the people who needed them most. With hardly an exception, the schedule of information showed the names of people who were on very low wages.
  The scheme has been going on for nearly two years; 10 houses have been built and all the houses are not yet occupied. Now it is discovered that the tenants have to pay a total of 15s. 6d. or 16s. per week, with the result that the very people for whom the houses were intended will not be able to occupy them. Most of the people who were quite ready to give information about wages, number of children and so forth, were on very low wages. An agricultural worker's wage is 31s. per week and it is a question whether an agricultural labourer with 31s, per week can afford even the 6s. mentioned by the hon. Member for the Combined English Universities (Miss Rathbone). There you have a case in which the purpose of the Act has gone astray—I will not say that it has been abrogated, because there were difficulties but I think it should be open to somebody to get the report of the analysis of costs in connection with such a scheme. I do not know how far the land purchase factor entered into that scheme, but I suspect that it was an important factor and I know that nearly eight months were consumed in negotia-
  992
  tions between the rural committee and the only land-owner who could sell or did sell land, before an agreement was reached on that matter.
  There you have an interest which might cut across any scheme of the kind in similar circumstances, unless, while we are dealing with the question of houses, we also deal with the ownership of land. That appears to be a fair deduction from our experience. The right hon. Gentleman the Member for Penryn and Falmouth has a wide experience of building. He has built all sorts of property from mansions and large residences to farm cottages. I would welcome any advice or assistance which he could give in work of this kind, but I think the Government must necessarily take into account any influences which may cut across the purposes of building or the machinery for building. One of the tragic things about the housing problem is the manner in which other things are affected by it. The other day I heard of the case of a young boy aged six years who was attending one of those excellent institutions known as open air schools and who constantly wanted to go to sleep. Sleep is part of the routine of an open air school and a very excellent provision too; but this boy wanted to sleep all the time, and when the circumstances were investigated by the teachers, they found that he belonged to a family of six who lived in one small room and that the sleeping accommodation of this little boy was the bottom of a cupboard. There is an instance where the question of housing affects the question of education. It may be that in the future we shall consider the whole social question from one point of view, but these are matters which I suggest to the House and the Cabinet as worthy of consideration.
  The question of ability to pay is another aspect of this subject which we ought to bear in mind and from which those of us who have any connection with industrial areas cannot escape. I represent a constituency, part of which is an industrial town. I refer to Stockton-on-Tees. In that town there are 14,000 houses. In nearly 1,700 houses two families live; in over 70, three families live; in nearly 30, four families live; and there are seven cases of six families living in a six-roomed house. Things of this sort make us afraid when we consider them from the point of view of

  993
  overcrowding. The difficulty of the house rent factor is likely to be felt most where there is a large degree of unemployment, and the unemployment figure in Stockton since 1920 has been almost static. It has stood at about 4,500 in a population of 68,000. That is tragic. There is no other word to describe it. How can these people who are now living in one or two rooms hope to move into houses which the local authority has built while insecurity of employment is just a normal factor in their lives? So we have this tragedy of the housing shortage cutting across education and employment and hitting us wherever we look. An hon. Member has referred to housing conditions in London, but I have here a report of an independent inquiry which has been made and no more terrible document, I think, has been penned of late years.
  It is the sort of thing from which one would like to escape in silence, but we can purchase silence too dearly. We have been too silent about the terrible conditions in which our people live. There are tens of thousands of young and inexperienced persons upon whom these terrible housing conditions are imposing a severe test, which never ought to be imposed, even upon adults. They are bearing it, and they are fighting it magnificently and successfully, but the social organism which supports it and which expresses its attitude even in silence is utterly condemned. Those who have read the Report of the Glasgow Housing Committee know what a fearful document it is. It reveals a condition of things which literally makes every right-thinking person in the Kingdom quite afraid of the future. It is not that our people cannot stand these conditions; it is not that they are going to be subdued by them, but that they create such a burden as our constitution is quite unjustified in placing upon them. I would, therefore, appeal to the Government not to be satisfied with the small thing in their housing proposals. I hope that, when their next Bill comes forward, it will propose something so definite that those least able to pay will be taken care of first, certainly. If we do not do that, the charge against us in the future will be a very serious one indeed. I support this Bill, as I say, in the hope that the next one may be both a wider and a better Bill.
  Brigadier-General CLIFTON BROWN: I do not know if it is the first speech of the hon. Member for Stockton-on-Tees (Mr. F. Riley), who has just sat down, but, if so, I am pleased to give him my very sincere congratulations, and I hope we shall often hear him again. He will forgive me for defending myself as an agricultural landowner about one point, and I wish hon. Members would realise that an agricultural landowner is very different from an urban or town landowner. I have 50 odd cottages, for most of which I get 3s. rent, and I do not get 6s. for any of those that are not let for that to my own labourers or estate workers. I do not think there is any local authority or anyone else in the country who really helps in this problem of low rents as the agricultural landowners. What we all want is enough houses, and houses at rents which people can afford to pay; and, looking at this Bill from that point of view, I must own that I think we are right to go on giving a subsidy for a bit longer at the present moment. I have never quite agreed with the last two cuts proposed by my own party, though I think the first cut has been justified from the point of view that it has cheapened building and, therefore, tended to bring down rents. I have always said, in my election addresses and on the platform, that the Socialist 1924 Act was a most useful Act for local authorities.
  In my own constituency, at Hunger-ford, a year ago they built 120 to 150 houses, in a very poor agricultural district, with the agricultural subsidy, and those houses worked out at very little over 5s. rent; and at Newbury, lately, they have been putting up houses under that same Act, and they work out at 7s. rent. I can assure any Minister of Health that if he wants to help the country people—and that is what I want to do—he should certainly continue that Act and help local authorities to go on building. If local authorities in the country districts can build and let houses at those rents, why cannot the Minister fix the rents? Would it not be possible to say to the local authorities, "You get this subsidy, and therefore your houses are not to cost more than 5s. or 7s. rent "? I know there are objections very often to fixing a minimum, as it is apt to become

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  a maximum, but I hope that something of that sort might be done in future legislation, so as to ensure that the subsidy goes to the tenants and not to the builders of the houses.
  Another point to which I should like to draw the attention of the Minister of Health is this: Subsidies must be carefully looked after, and in very many cases where you get a subsidy the houses are not let to workers and agricultural labourers, but to other people, who make better tenants for the local authorities. Local authorities, like private owners, like to get us much rent as they can, and the result very often is that the poor labourer gets left. There is one other point from the country point of view which, though I am afraid it cannot be altered in this Bill, will, I hope, be kept in mind, and that is that in every village and town in this country there are old people, who do not require the big subsidy houses. They can neither afford the rent nor do they require such houses, but their children, who have grown up in the village, do. Very often there is a shortage of houses, and you ought to have a couple or three or four almshouses in every village, or more in a bigger town, where the old people could be moved into the two-roomed cottages, and those cottages could be let at rents of 3s. or 4s. almost without any subsidy.
  I have great sympathy with the plea of an hon. Member opposite that a certain amount of de-rating should be applied to our housing, instead of a subsidy; it might be applied to small houses for old people which could be excused paying rates for 25 years. You would then get private enterprise building a great many of these houses, which would help considerably. Where I think the Minister may fail and may not provide the number of houses necessary is if he does not encourage private enterprise, either in the way I have suggested or in other ways, or enable private enterprise to believe that it is quite safe in building houses and able to get 3s. or 4s. rent for them. I do not think we should have had any success in producing houses in the past if we had only trusted to the local authorities and subsidies and had not had the full benefit and help of private enterprise. What we want to do is to look
  996
  at this problem from the point of view of producing houses at rents which the poor people can afford to pay, and I can assure hon. Members opposite that, if they will treat private enterprise fairly, it will not only be cheaper for them, but they will get the numbers required and will help to bring rents down to what the people can afford to pay.
  The PARLIAMENTARY SECRETARY to the MINISTRY of HEALTH (Miss Lawrence): With some regret, I recall the House from the Debate to the Bill. This is a very small and modest Bill, but we have had a very long, a very expert, and a very interesting discussion. The feature of the Debate has, I think, been the number of Members who to-day and on a previous stage of the Bill spoke for the first time in this House. I think that is a sort of indication of the extreme interest with which the House considers this question and I may say that it is very encouraging to my right hon. Friend the Minister. Let us consider for a moment what an enormous and wide Debate we have had. Almost every Member who has spoken has attacked the root problem which lies before the Government, namely, the question of securing enough houses at rents low enough for the poorest class of the inhabitants to pay, and every other Member proposed some new and interesting manner of dealing with the question. The Debates have been very fertile in suggestions. We have had the question of lower rates of interest to be charged for the loans to the local authorities, we have had, from three or four quarters of the House, a proposal as to special de-rating for small house property, we have had, from other quarters of the House, and particularly from the hon. Lady the Member for the English Universities (Miss Rathbone), a proposal of a kind of family allowance. The right hon. Member for West Woolwich (Sir K. Wood) asked why we did not get on with the Housing Bill before the autumn—
  Sir K. WOOD: I asked why you did not go back to the original subsidy.
  Miss LAWRENCE: The right hon. Gentleman gave a regular cross-examination about what we were going to do in the autumn with reference to the subsidy, and why we did not put up the sub-

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  sidy, and he showed an enormous curiosity about a whole number of things. My point is that, with a House so interested and so critical, with a House so desirous of exploring every possible avenue, we could neither have brought in a Housing Bill at this period of the Session, nor could we have restored the original subsidy. The hon. Member for Withington (Mr. E. D. Simon), for instance, said that if we had attempted to go back to the 1924 subsidy, he would have opposed it, because he could think of a better way of spending the money. What is quite certain is that if the House had once embarked on the fascinating topic of how we could spend any increased subsidy, we might have spent August and September here before we should have finished, and I think that is plain to everybody who considers the question and the extraordinary fertility of the suggestions which have come from various hon. Members.
  Now I turn to the Bill. I will give the House two or three figures to show why we want this Bill. I have here the figures of the different classes of houses that were built in the quarter ended September, 1927, the quarter before the subsidy cut, and the figures after that quarter. Under the 1923 Act the local authorities built 6,486 houses in the quarter ended September and 2,176 in the next; private enterprise built 37,000 houses in the quarter ended September and 8,000 in the next. The local authorities, under the Financial Provisions Act, 1924, built 45,000 houses in the quarter ended September and 13,000 houses in the next quarter. Altogether, under assisted schemes, 89,000 odd houses were built in the quarter ended September, 1927, and 24,000 houses in the quarter ended January. I want this House to consider what sort of objection would have been raised if we had forced production up in one quarter and had such a slump in the next. The actual figures were 89,900 houses in one quarter and 24,300 houses in another. In a slump of that kind you make prices capricious and disorganise the trade. These are the only considerations that led us to bring in this little emergency Bill before the autumn. It would have done a very bad service to house building if we had dislocated the trade, and it would have done a disservice to employés if we had created
  998
  an artificial slump in the building trade in the months of October and November. That is the only case with regard to this little Measure, and it has so far won the favour of the House that there is not going to be a Division on the Third Reading, any more than there was on the Second Reading, or any more than there was any Amendment in Committee.
  I want to say one or two words about prices. Some people talk about these grants as if they are subsidies of the same nature as subsidies for the sugar beet industry or for the coal trade. People say that subsidies are unpopular but grants-in-aid of local finance are perhaps the most popular thing in the country of which I know. This is not a subsidy in the usual sense of the term. It is a grant-in-aid of the finances of local authorities. It is not a new thing that the State should make a grant-in-aid of capital expenditure of local authorities. When we are building a clinic, the interest on the capital ranks for grant, and it is exactly the same principle, though a rather different shape, when the State contributes to the capital expenditure on housing. No one ever argues that the fact that the capital cost of education was defrayed by the State was a factor in raising prices. People argue that builders raise their prices more when the money comes from taxes than when the money comes from the rates. We are giving the money on the grounds that the local authorities have had more burdens than they can properly pay from the rates. That has been the justification of the State assisting local authorities in housing. To cut off the subsidy would really leave the local authorities, very much overburdened as they are, to shoulder the whole of the burden. The truth of the matter is that you can alter the price of houses enormously by certain manipulations. You can bring them down to whatever price you like and push them up to scarcity values, but you can do that without a subsidy.
  The late Parliamentary Secretary seemed to think that I said that the wholesale price index had something to do with causing the prices of the Addison houses to go up. I said that it was absurd to drawn any conclusions about the subsidy with regard to the Addison houses in the time of acute money crisis from 1923. When we had

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  that violent crisis every single commodity was not only going up and down with the rise and fall of money, but was being blown about with every wind of panic, and it is quite a senseless thing to talk about the Addison subsidy when every business man knows that money values changed violently every two or three hours. That is what I said in regard to the Addison subsidy, and that is why I took the index of wholesale prices as an indication of the depth of the fall and the quickness of the recovery of the value of money. This Bill is the smallest thing in the world. It is to prevent dislocation in prices and employment. The greater considerations which Members have urged are occupying the mind of the Minister, and will be published before the discussion in good time. It will obviously be improper of me or of my right hon. Friend to indulge the House at this stage with any glimpse of what he is proposing. The object of the Bill is to get out of the way one of the obstacles to a rational scheme of housing.
  Question put, and agreed to.
  Bill read the Third time, and passed.

DEVELOPMENT (LOAN GUARANTEES AND GRANTS) BILL.
Considered in Committee.
[Mr. ROBERT YOUNG in the Chair.]

DEVELOPMENT (LOAN GUARANTEES AND GRANTS) BILL.

  CLAUSE 1.—(Power of Treasury to guarantee loans.)
  The CHAIRMAN: An Amendment handed in by the hon. Member for Stockport [Mr. Hammersley]—in page 1, lines 18 and 19, to omit the words "a public utility," and to insert instead thereof the words "any industrial, commercial, agricultural or business"—is not in order as it is outside the scope of the Money Resolution. An Amendment handed in by the hon. Member for Chislehurst (Mr. Smithers) is also out of order for the same reason.
  Mr. SANDHAM: I beg to move, in page 1, line 19, at the end, to insert the words
  "Provided that wherever public assistance is given to a limited liability company the Treasury shall acquire an equitable measure
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  of control of the company concerned by the appointment of directors on the board of the company."
  In moving this Amendment, I should like to call the attention of the Committee to the words contained in Clause 3:
  "In this part of this Act the expression 'public utility undertaking' means an undertaking carried on under statutory powers by any body of persons for providing means of transport or communication, gas, electricity, water or power, but does not include any such undertaking which is carried on by a body of persons to whom a grant may be made under Part II of this Act."
  I have no desire to waste the time of the Committee, and, if my desire for brevity interferes with clarity, it is a result of my inexperience in the House. In dealing with this Amendment, it must not be understood that I am condoning any of the injustices accruing from the usages of the statutory powers of a public utility company, particularly those affecting the holding of debentures. At the same time, I am not unmindful of the remarks of my right hon. Friend the Lord Privy Seal when he said:
  "While I am entrusted with this position, I am not going to ask Parliament to give me any power which means the loss of effective and absolute Parliamentary control. It is rather surprising that I should be accused of seeking to do that, because I have always fought everybody on my own side or on any other side on that question. My record is well known. I have never hesitated to say: 'No. Parliament is the guardian of the public purse and Parliament must have absolute control!'"—[OFFICIAL REPORT, 19th July, 1929; cols. 796–7, Vol. 230.]
  7.0 p.m.
  I desire to move this Amendment, in the first place, as an advocate of Socialism, in the second place because I am a staunch believer in disarming criticism, and, in the third place, because I wish to develop even greater confidence in our present Government. My object is to help and not to hinder the very arduous tasks of the Lord Privy Seal and the Chancellor of the Exchequer. I realise profoundly the gravity as well as the urgency of this great problem and the evil of capitalism, namely unemployment. At the same time, I was moved in the Debate by the prevalent anxiety among right hon. and hon. Gentlemen of both Oppositions to protect the welfare and interest of the funds of the Treasury. I desire to disarm criticism among the community

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  in general by the introduction of this Amendment and in particular among the business firms and limited liability companies who do not benefit or participate in these schemes for the relief of unemployment.
  I am reminded of the position of two very important statutory public companies. One of them had the maximum of capital, but a lack of technique in the industry, while the other company had the technique but lacked the capital. These two companies got together and it was suggested that they should exchange three directors from each of their Boards in order that each might help and watch over the activities of the other. The results secured were certainly very satisfactory. The company that was anxious to receive the capital got what it wanted, while the company which was anxious to get the technique also got what it wanted. In this matter, I am anxious that we, as a House, should have the interests of the House covered by control by representatives on these boards of directors. If this object can be secured as it was secured in the case of the two companies I have mentioned, surely the Government themselves are in an equally satisfactory position to see to it that their representatives on the boards of directors of companies, which are receiving grants or loans, should have an equivalent amount of control and watchful interest over the companies. If that point be agreed, then it covers the object of this Amendment.
  At the same time, I assure the Committee that it is not my intention to hamper the Government by pressing this Amendment to its logical conclusion. I am not stiff-necked about this business; as a matter of fact, I am resilient in my attitude. I want to help the Government and not to hinder them. If, therefore, we can be assured by the Lord Privy Seal and the Chancellor of the Exchequer or by either of them that this matter will receive the careful consideration of their Departments, that assurance will to my mind enable this Amendment to be withdrawn, and in that spirit I move the Amendment standing in my name.
  The LORD PRIVY SEAL (Mr. J. H. Thomas): The House will, I am sure, agree that no one could move an Amendment in a more agreeable form than my hon. Friend. Not only do I congratulate
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  him on the very concise and illuminating statement of his case, but also on his wisdom when he suggested not pressing it to a Division. I would ask the Committee to bear in mind the object of the Amendment. I gather that it is to say, in substance, that, if there is Government money, then in some way there ought to be Government control. That is the view behind the Amendment. I am sure, however, that if my hon. Friend will look at the Amendment he will see how impossible it would be. The Amendment says:
  "Wherever public assistance is given to a limited liability company the Treasury shall acquire an equitable measure of control of the company concerned."
  The Committee will see at a glance that there would be considerable difficulties as to what was an equitable measure of control. For instance, I have in mind a case where the maximum amount of guarantee is perhaps £2,000,000, but the total capital of the company may be more than £100,000,000. In that case, an equitable part would be a leg or a hand of an individual and not even his head judged from the standpoint of the amount of money invested. It is therefore impossible to talk about an equitable control.
  I would rather put it to the Committee in this way. This Amendment is dangerous from the Treasury's point of view, because you cannot have an individual member of a board sharing in the responsibility of a board and then have the Government blamed for his individual actions. That arose in the discussions on the Anglo-Persian Oil Company. A principle is involved in this respect. There is nothing at the moment to prevent the Treasury insisting on having a member on the board if the circumstances warrant them in doing so. On balance, however, I think it is a mistake for me to appoint one member on a board and then hold him responsible for any criticism that follows. The public, too, might then blame the Government because of the action of the Government nominee. For those reasons, I give this assurance to my hon. Friend and the Committee. If, under any circumstances, the Treasury feel that some representative ought to be there, we shall not hesitate to act. To make it a condition would not only be undesirable, but I do not see how it could have a good effect, and for this

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  reason. Up till now I could conduct no negotiations at all. It is quite true that I have seen all sorts of people, but, so far as discussing any scheme is concerned, I cannot possibly discuss it until I get this Bill. We are nearing the end of July therefore before I can even discuss a scheme, because I cannot discuss schemes until I know the terms. If this Amendment is accepted, it would mean that, before these companies could do anything, they would have to come to Parliament to ask for power to alter their Articles of Association. That would mean further delay. I understand the motive behind this Amendment, but to endeavour to give effect to it is absolutely impossible.
  Mr. WALLHEAD: I would like to point out that there is another aspect of this question, namely, the fact that without this money many of these companies would be absolutely derelict and bankrupt, and from that point of view—
  Mr. THOMAS: That is another point, I am doing something to see to that aspect of the matter.
  Mr. WALLHEAD: I only wish to draw-attention to the fact that, whatever hon. Members on the other side of the House may say, we in this country are passing through a transitional period in which capital now finds itself unable effectively to carry on without the aid of the State. As far as we are concerned, we are not prepared to come continually to the rescue of Capitalism unless we get some compensation in the way of State control.
  Mr. D. G. SOMERVILLE: I would like to say a word in favour of this Amendment, because it seems to have certain possibilities. In order to get a State representative on the boards of these companies you would have to get directors appointed and, as directors are always paid, surely it would be very convenient for the Government, if they wished to reward some faithful servant in the Socialist party, to appoint him a director of these companies. This Amendment would also help to carry out the Socialist scheme of gradualness, because by appointing directors to these public utility companies they would gradually get the control and so fulfil the scheme of the Chancellor of the Ex-
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  chequer. In time, the State and the Government would control the whole of the companies of this country. The Amendment therefore appears to offer advantages to the Government, and I would like to support it.
  Mr. LEE: On a point of Order. Is the Amendment withdrawn?
  Mr. SANDHAM: May I be permitted to withdraw the Amendment?
  The DEPUTY-CHAIRMAN (Mr. Dunnico): The hon. Member rose too late.
  Amendment negatived.
  Mr. SMITHERS: I beg to move, in page 2, line 18, to leave out the words "the near future," and to insert instead thereof the words:
  "six months after the date upon which this guarantee is made."
  I bring this point to the notice of the Lord Privy Seal because I think the expression "the near future" is too indefinite. Supposing the Government gave a guarantee to a public utility company and the company did not carry out the conditions of that guarantee and the Government were compelled to take the company to Court. How is the judge to decide upon such words as "in the near future"? I am not wedded to the limit of six months, and I would not mind any other period the Lord Privy Seal thinks better, but I do ask him to fix a definite period.
  Mr. THOMAS: If I were thinking only of being able to get something done right away I should be delighted to accept this Amendment, but I wonder what the Committee would think if I did accept it. It would mean that a dock, harbour or other company could come along and say, "We want Government assistance for a job that we are going to do ourselves in six months' time."
  Mr. SMITHERS: No.
  Mr. THOMAS: It is no good the hon. Member saying that. That is what the Amendment means, though he has frankly said that he is not riveted to a period of six months, and that his only object was to get some statement from us as to what is in our minds. I have already told the Committee that in the case of the Lord St. Davids Committee I altered the acceleration period from

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  five years to three years. Therefore, a municipality can be given a grant on the usual terms if they state that they will undertake at once work which in the ordinary course would not be done for a certain number of years, provided that the number of years is a minimum of three—at least, they are entitled to have their case considered. In this case it is difficult to lay down a period. There are certain waterworks and certain electricity undertakings which might say they would not be justified in commencing certain work now and did not intend to start it for 12 months; but I do not think even a period of 12 months would meet the case, and what I have in mind at the moment is a period of somewhere about three years, being the same period as for the Lord St. Davids Committee. Here again the Committee must observe the difficulty that presents itself, because if the putting in hand of an undertaking were to be speeded up by three years there clearly could not be the same claim for assistance as there would be if it had not been proposed to undertake it until five years or 10 years hence. Therefore I do not want to dogmatise. We ought to be free to consider the merits of the schemes themselves and their ultimate value to the community. I certainly could not agree to a limit of six months or even 12 months, and I hope the hon. Member will accept the explanation which I have given.
  Mr. SMITHERS: I only inserted the term of six months in my Amendment to see whether the right hon. Gentleman was willing to put in any limit at all and I would like to know whether he will do so. May I ask, further, whether the committee or the body which gives the guarantee will have administrative powers to ensure that the work is proceeded with as fast as possible?
  Mr. THOMAS: As I have said, we cannot lay down a hard and fast rule, and I am sure that a member of the St. Davids Committee who is present will confirm me in that view. All we can do is to issue a set of instructions as a general guide to the committee. Those instructions will be issued in all cases to this committee—certain clearly defined principles upon which they must work, and it will be for the Government to see that the conditions laid down are strictly observed.
  Sir LAMING WORTHINGTON-EVANS: The right hon. Gentleman has said that these schemes are going to be subject to general instructions. Ought not this Committee to be told what those instructions are—at least in general principle? When the previous schemes were in operation there was a Treasury Minute dealing with them. I referred to it in the House the other day to show what some of the conditions of that Treasury Minute were. If the right hon. Gentleman will tell us now or at some other time what the conditions of the Treasury Minute are he may be able to satisfy us that this rather vague Clause should stand. I, myself, do not object to the vagueness of this Clause. My hon. Friend the Member for Chislehurst (Mr. Smithers) will notice that this Amendment is a limitation on the power of guarantee. I do not want to limit the power of guarantee provided it is used for the purpose of ensuring employment, and I see the difficulty the right hon. Gentleman is under in agreeing to three years or a year or six months; the point is the scheme has to be put forward with a view to providing employment.
  Mr. SMITHERS: The right hon. Gentleman says the expression "the near future" referred to the guarantee. I would point out that it is a question of
  "the probability or not of the scheme in question not being proceeded with in the near future,"
  which means the work and not the guarantee.
  Sir L. WORTHINGTON-EVANS: The Government are taking the power to guarantee, but in considering whether or not they will do it they take into account whether a scheme would in the ordinary course have been proceeded with in the near future. That is the limitation, and I do not disagree with that limitation; but the right hon. Gentleman has said that conditions are going to be laid down. When I was speaking the other day and said there ought not to be secret instructions but instructions of which the House knew, my suggestion was greeted with cries that it was an unworthy one. I repeat that. The right hon. Gentleman says that instructions will be given to the committee regarding the general lines upon which schemes are to be approved

  1007
  or not to be approved. I agree that that should be done, but I think the House ought to know what the conditions are going to be.
  Mr. THOMAS: I am quite sure that the House is entitled to know, but the right hon. Gentleman is mixing the things. I reminded the right hon. Gentleman before, and I repeat now, that those instructions were issued by the Treasury with regard to something as to which there was no statutory power. It is no good the right hon. Gentleman shaking his head.
  Sir L. WORTHINGTON-EVANS: I am not shaking my head.
  Mr. THOMAS: Those instructions were issued after the power had been taken. This Bill regularises the position by laying down the conditions. The Bill says, first, that no scheme can be considered which does not mean an acceleration of work. That was contained in the Treasury instructions. The Bill also mentions the condition that the scheme must find immediate employment. That was a point, too. The third point is that when the House meets in November any instructions given to the committee can be communicated to the House. But I put it to the Committee that with the restrictions laid down here, which are essential, surely an opportunity might be given to the committee itself to be guided by their experience. In the case of the St. Davids Committee there were changes from time to time based on experience.
  Sir L. WORTHINGTON-EVANS: But the right hon. Gentleman does not know his own Bill. My hon. Friend was perfectly right in calling attention to the vagueness of these words. I was honestly trying to help the right hon. Gentleman and suggested that though these words are vague we ought not to make them so precise that they will interfere with his reasonable administration; but when the right hon. Gentleman says he is going to issue instructions to the committee I ask him why he cannot let us know what those instructions are to he, because then we should get rid of this vagueness and he would get the power which he requires.
  Mr. LLOYD GEORGE: I hope the hon. Member will not press his Amendment,
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  because I do not see that it can achieve the object which he has in mind. The effect of the Amendment would be that the Government could utilise the credit of the Treasury in any case where without that guarantee there would be no probability within six months of the scheme being initiated. So far from its being a limitation, I think that is almost an extension of the powers of the Lord Privy Seal. I do not agree with my right hon. Friend that on the whole the guarantees here are not adequate. I do not know whether my memory plays me false, but I think that on the whole they are practically the same powers as existed under the Trade Facilities Act. First of all the Government have to be satisfied that the scheme will provide employment. The second consideration, and perhaps this is the more important, is that in the near future—the insertion of this six months would not make a penny of difference one way or the other—
  Mr. SMITHERS: I have said more than once that the term "six months" was put in the Amendment only for the purpose of drawing attention to the vagueness of the present wording. I am not wedded to the term of six months if the right hon. Gentleman the Lord Privy Seal would agree to either two years or three years.
  Mr. LLOYD GEORGE: That is where I think it would be a mistake. What the Government have to be satisfied about is whether, without utilising the credit of the Treasury, there is any chance of the work being proceeded with in the near future. Whatever schemes there are it is vital that they should be initiated at the earliest possible moment. I would not have a limit of six months. We have the winter in front of us, and should there be any prospect of a scheme being initiated, provided the Government use their credit to assist it, which would not have been started without that credit, then I think we ought to give the Government a free hand. I am glad to take this line with regard to this particular scheme, because I took a very strong view with regard to the limitations in the matter of the free gifts or grants. I shall have something to say about them later on, as I anticipate there will be a statement from the Treasury Bench, because we were promised on Friday that one would be made.

  1009
  This, however, is a totally different matter. This is a question of the utilisation of the credit of the Government for the purpose of initiating work, and I trust that after the explanation given by the Lord Privy Seal it will not be necessary to divide on this Amendment. I do not see that it is desirable to restrict unduly the powers of the Government with regard to the utilisation of the State credit for the purpose of initiating schemes at the earliest possible moment. With regard to the instructions which have to be given, I have no doubt that the Lord Privy Seal will be in a position to inform the Committee, but naturally he wants his Bill first before he can issue his Minutes.
  Mr. PYBUS: As the member of the Unemployment Grants Committee to whom the Lord Privy Seal has referred, I would like the Committee to concede the very widest powers as regards anticipation. It is a very serious and difficult matter to be too rigidly bound to fixed rules to administer schemes which come from the different authorities. If you have a fixed rule regarding anticipation and the time which a scheme must be started, you may find that one of your very best schemes has been turned down. With regard to the danger of schemes not proceeding as quickly as promised, which was raised by the hon. Member for Chislehurst (Mr. Smithers), I can assure him that under the Lord St. Davids Committee schemes, if the work is not finished by the time arranged, a portion of the grant may be lost. For these reasons and as a result of some experience I urge the Committee to give the Committee the very widest powers.
  Mr. ERNEST BROWN: I think, if a period of six months is fixed, the proposal would be quite hopeless, and I hope the Amendment will not be pressed.
  Mr. SMITHERS: I beg to ask leave to withdraw my Amendment.
  Amendment, by leave, withdrawn.
  Question, "That the Clause stand part of the Bill," put, and agreed to.

  CLAUSE 2.—(Power to make grants towards meeting interest charges on development loans.)
  Mr. CHURCHILL: I very much regret that I was not able to be present during the Debate which took place on Friday.
  1010
  We have been promised that a statement would be made to the Committee as to the view which the Government took in regard to the limit of the expenses under this Clause.
  The DEPUTY-CHAIRMAN: I must remind the right hon. Gentleman that there are some Amendments to this Clause.
  Mr. CHURCHILL: I understand that you have already put the Question, "That the Clause stand part of the Bill."
  The DEPUTY-CHAIRMAN: No, I only called the Clause in order to proceed with the Amendments.
  Mr. CHURCHILL: I think it would be more convenient if we could discuss the Clause after we have had a full explanation of the intentions of the Government.
  Mr. LLOYD GEORGE: I understood that there was an Amendment to be moved in page 2, line 43, which would raise the whole question. That Amendment has been suggested in order to have a Debate in which the whole question can be raised. The Question "That the Clause stand part of the Bill," would come better after we had disposed of all the Amendments. I think it would be better to have an Amendment on the specific issue of the limit to be imposed in line 43.
  Mr. THOMAS: I am prepared to deal with this matter on the question of the Clause if that is for the convenience of the House.
  The DEPUTY-CHAIRMAN: I simply announced Clause 2 in order to call upon the first Amendment, and I would remind the right hon. Gentleman the Member for Epping (Mr. Churchill) that it is not in order at this point to discuss the general question. Of course, in this matter I am entirely in the hands of the Committee, but, strictly speaking, the right hon. Gentleman the Member for Epping is not in order at this stage in discussing the general question, more especially in view of the fact that I have before me an Amendment on Clause 4 dealing specifically with this question.
  Mr. CHURCHILL: I submit that it would be more for the convenience of the

  1011
  Committee to have this important decision taken upon the Government policy before proceeding any further with the discussion of this Clause and the following Clauses. The statement of the intentions of the Government might affect the view which the Committee would take and such a course might shorten the discussion. Supposing the Government made a statement which the Committee regarded as being very unsatisfactory, undoubtedly there would be a closer criticism than if the Lord Privy Seal was able to make a reassuring statement.
  The DEPUTY-CHAIRMAN: Might I suggest to the right hon. Gentleman the Member for Epping that this could be done if he would move to report Progress.
  Mr. LLOYD GEORGE: I think the whole discussion of this question should be raised by an Amendment to Clause 2 which deals with grants to public utility companies. That is exactly where we desire to raise the question of a limit. The Amendment suggested is to insert in page 2, line 43, after the word "may," the words:
  "within the limits of the amount fixed in advance by the Government Department."
  That would enable hon. Members to raise the whole issue of the limitation. If we have a discussion now on the whole Clause we cannot move Amendments, but, if an Amendment were moved now dealing with limitations, it would be permissible for my right hon. Friend the Member for Epping to make his speech on that issue.
  Mr. CHURCHILL: I still submit that it would be for the convenience of the Committee if we could have some statement in regard to the intentions of the Government. I do not wish to take up a controversial attitude by moving to report Progress, and I should be quite willing to move an Amendment to leave out the word "Treasury" in the first line of the Clause.
  Mr. E. BROWN: That would not he in order, because it would leave the Clause incomplete.
  The DEPUTY-CHAIRMAN: I understand the purpose of the Amendment is
  1012
  to enable the Lord Privy Seal to make a general statement to the Committee.
  Mr. BROWN: Surely, if an Amendment is moved to allow a Minister to make a statement, it must be in terms which will read. To leave out the word "Treasury" as suggested, would leave the Clause in an incomplete form.
  Mr. WALLHEAD: I wish to raise the question of the undesirability of continually having manuscript Amendments placed before the Committee. I assume that some importance is attached to those Amendments, and surely it would be for the convenience of the Committee to have them placed on the Order Paper instead of being handed in at the Table.
  Mr. BROWN: We have done our best to meet the Government, and all we desire is to have this question of the limit discussed.
  Mr. CHURCHILL: I beg to move, in page 2, line 41, to leave out the word "Treasury," and to insert instead thereof the words "Board of Trade."
  I move this Amendment in order that a discussion may take place on this question.
  Mr. W. J. BROWN: There are Amendments on the Order Paper, and manuscript Amendments have been handed in. Under these circumstances, I want to know whether it is in order for a right hon. Gentleman to move verbal Amendments which take precedence—
  The DEPUTY-CHAIRMAN: It is perfectly in order.
  Mr. LEIF JONES: If the word "Treasury" is left out, it makes nonsense of the Clause. I think we should be told what words it is intended to insert if the word "Treasury" is struck out.
  The DEPUTY-CHAIRMAN: The Amendment is to leave out the word "Treasury" and to insert instead thereof the words "Board of Trade."
  Mr. THOMAS: I do not know what the Amendment means, and I do not think anyone else does. The situation is this: A distinct promise was made on Friday that, between then and the Committee stage, an effort would be made to consider the request of the House that some limit should be inserted in the Bill or a

  1013
  Statement made indicating the Government's views of a limit. We have discussed in all its bearings the difficulty of inserting any figure in the Bill, which we could not—the House itself would have to take that responsibility. The difficulty is, first, that, if you put a small figure, it would look ridiculous, while if you put an extreme figure it would do harm, and in neither case could you justify it on any negotiations which have taken place. I gather that the House accepted that situation, and that what they wanted to know was what was likely to happen between now and when the House reassembled—what was the maximum commitment that was likely to take place, so that, when the House reassembled, the ordinary Vote would be put down, and the House would be in full possession of the whole of the facts.
  In view of that, we have decided that, just as £25,000,000 is mentioned in Clause 1, so we would undertake that there shall be no commitment of any sort or kind to a capital expenditure of more than £25,000,000 as between now and November. In making that statement and in giving that figure I would clearly indicate on behalf of the Government that it is merely a token figure; it is not based upon any negotiations, because, as the Committee ought to know, I have not even started, and cannot start, negotiations, I cannot even issue a circular either to local authorities or public utility companies, until this Bill is through, for the terms and conditions cannot be determined until Parliament itself has determined them. Therefore, I do not ask the Committee to assume, and in fact I go beyond that and say that I do not think—I wish I could think—that even a capital expenditure of £25,000,000 will be undertaken in this period—I do not think so for a moment. But the Government give that guarantee to the House, the same figure as is indicated in the first part of the Bill—though I do not think it will be reached—in order to meet the general view expressed by the House that some limit should be fixed. Accordingly, the figure of £25,000,000 is named by the Government.
  Mr. CHURCHILL: I should just like to ask the right hon. Gentleman a question before I address myself to the topic. When the Chancellor of the Exchequer spoke on this subject on Friday, he said:
  1014
  "If it is the wish of the House in Committee to insert a figure, such as £5,000,000, the Government will agree to that being done, but of course on this understanding. It is impossible at the moment to say whether under this alternative scheme any such figure as £5,000,000 would be a final figure."—[OFFICIAL REPORT, 19th July, 1929; col. 824, Vol. 230.]
  The Chancellor of the Exchequer was, I believe, understood to be referring to the gifts or grants to be made to these companies under Clause 2. The Lord Privy Seal this afternoon has used the expression "Capital expenditure," and he has mentioned a figure of £25,000,000. I would be very much obliged to him if he would be so kind as to relate these two figures, and explain exactly whether they cover the same ground or not. Is this £25,000,000 intended to be a measure of the gifts or grants which may be made to these public utility companies under Clauses 2 and 4, and is it, therefore, five times larger than the figure foreshadowed by the Chancellor of the Exchequer? How does it stand?
  Mr. THOMAS: The Chancellor of the Exchequer was, as the right hon. Gentleman has said, dealing with one aspect of the question—he was dealing with a full commitment of the Government. The right hon. Gentleman was present and I think he will acquiesce in what I say. The Chancellor of the Exchequer was dealing with a full commitment of the Government. I am not dealing with that but I am prepared to give an undertaking that between now and the reassembly of Parliament the loans on which interest grants may be made under the Clause shall not exceed £25,000,000. That makes it perfectly clear, as I stated to the House, that, if any body or bodies covered under the Bill came along with schemes of the capital value of £25,000,000—it may be that interest for one year may be paid, or it may be for two years or three years, and, as I have clearly indicated, you cannot lay down the conditions in every case—no capital expenditure above £25,000,000 will be dealt with by the Government between now and the re-assembly of Parliament.
  Mr. LLOYD GEORGE: I would like to understand fully what the Lord Privy Seal proposes to do. I and my hon. Friends here have indicated clearly that we will not press him for the insertion of any limit in the Bill, because I think

  1015
  that that would be a mistake. We were only pressing for some definite guarantee from the Government that before the House met they would not commit the country beyond a certain limited figure. The right hon. Gentleman has now given that limited figure, but there are one or two questions that I should like to put to the Government. These grants apply to two categories. They apply, in the first instance, to public utility companies like railway, water and other companies, which are making a profit. That is under Clause 2. But they also apply, under Clause 4, to public utility bodies—which probably means local authorities and others—that make no profits. I understand that the £25,000,000 will apply to both categories, and that—
  Mr. THOMAS: No; I thought I had made that perfectly clear. I have not dealt with the St. Davids Committee; I did not mean that at all; I was only dealing with Clause 2—£25,000,000 of capital expenditure.
  Mr. LLOYD GEORGE: That is for the profit-making concerns.
  Mr. THOMAS: Yes.
  Mr. LLOYD GEORGE: That is the first question that I wanted to put. My second question is this. I understand that what the right hon. Gentleman means by the £25,000,000 of capital expenditure is the capitalisation of the amount of the guarantee which is given to these companies. The suggestion was made by the Chancellor of the Exchequer that for 10 years, perhaps, the whole of the interest might be paid, that afterwards perhaps one-half might be paid, then one-third, until it reached vanishing point at 15 years. What this indicates is that the Government are proposing something which, capitalised as a liability at this moment, would be a maximum of £25,000,000.
  Mr. THOMAS: Certainly not. Let me make it perfectly clear. It is that the total capital sum upon which any guarantee of any sort or kind—I thought I had made it perfectly clear before—would be £25,000,000. That is quite clear and definite.
  Sir HUGH O'NEILL: That is to say, grants.
  Mr. THOMAS: Well, I will use the term "grants."
  Mr. LLOYD GEORGE: It is in respect of a capital amount of £25,000,000.
  Sir HILTON YOUNG: As I understand it, the definition given by the right hon. Gentleman is not a precise limitation as regards the possible actual expenditure. The capital amount might be quite nominal. If I may illustrate my argument by putting a hypothesis which I do not mean to have any shadow of offensiveness at all, but which I state just to illustrate the possibilities, the nominal capital amount might be artificially reduced, and thus, by fixing a very high nominal rate of interest, a nominal capital amount of £25,000,000 might be made to cover almost any kind of annual grant. I only suggest that to show that there is no absolutely precise definition of the possible amount to be spent.
  Mr. THOMAS: Do not let us quibble. I have already said that up to now I am unable even to issue a Circular to any body. I want the Committee clearly to understand what is meant. I have explained, and I repeat, that there is no such shady transaction as that indicated by the right hon. Gentleman the Member for Sevenoaks (Sir H. Young). Who are the bodies concerned? They are all bodies under statutory obligations to this House. That is the first thing to keep in mind. They have all to prove their case, first to a Government Department, then to a business Committee, and then to the Treasury. I submit to the Committee that, surely, that is a check and that no such shady transaction could pass muster with a business man.
  Sir H. YOUNG: Of course, I do not for a moment suggest, any shady transaction; I was only venturing to point out to the Lord Privy Seal that the limitation which he proposes is not a specific monetary limitation on the commitments or grants which may be made out of the Exchequer. That is a point of substance, and not a quibble. Next I should like, again without a shadow of ungraciousness, to express regret that the limitation is not to be inserted in the Bill. I do not for a moment suggest that an undertaking given by the Lord Privy Seal is not as absolutely binding as an Act of Parliament, but, in a matter of financial regularity, it is of more than

  1017
  formal importance that the forms under which the national business is transacted should be maintained, and I do suggest that it would be desirable that those who in future may be referring back to precedents and so forth should be able to find this limitation standing on the same authority as the power to make the expenditure.
  8.0 p.m.
  Sir L. WORTHINGTON-EVANS: I am afraid that the Lord Privy Seal has not given us a very definite limitation. He says that the capital sum in respect of which grants are to be made shall not exceed £25,000,000, but the grants may under the Bill be for 15 years. Let us assume for a moment that the interest is 5 per cent. If a grant is made for one year on £25,000,000, it is £1,750,000; if it is made for 15 years it is £18,750,000. The undertaking that the right hon. Gentleman has given is that the power taken by the Government is to be anywhere between £1,250,000 and £18,750,000. That is playing with the House. That is not really giving a limitation; it is not really stating what the Government's intention is; it is taking so wide a margin that it is not a security at all. I can understand that for platform purposes the Chancellor of the Duchy of Lancaster might say that under Clause 1 £25,000,000 is to be the limit of the capital in respect of which guarantees are to be given, but let us leave the platform. Let us look at where we are now, in Committee of the House of Commons, with the duty to consider our expenditure and the powers to be given to the Government. The Chancellor of the Exchequer on Friday intimated that the total liability of the taxpayer in respect of grants was £5,000,000. [HON. MEMBERS: "No!"] It is clearly recorded in the OFFICIAL REPORT. I thought that was a short and sufficiently accurate way of stating it. He did not pledge himself to that. He said he would consider it between Friday and Monday, but he did mention the figure of £5,000,000 as a possible limit of the financial liability. If you are going to have a limit at all, let it be a limit of the taxpayers' money. Do not let it be a limit indirectly of the capital sum to be guaranteed when it may be £1,250,000 or it may be £18,750,000.
  Mr. CHURCHILL: I understand we shall be able, on the Question that the
  1018
  Clause stand part, to discuss this matter further and I should like to ask leave to withdraw the Amendment, which I moved for the purpose of allowing the question to be raised now, and to thank the Lord Privy Seal for the information he has given.
  Amendment, by leave, withdrawn.
  The DEPUTY-CHAIRMAN: The next Amendment, in page 3, line 3—to leave out the words "public utility" and to insert instead thereof the words "industrial, commercial, or agricultural business"—I have to rule out of order as outside the scope of the Bill.
  Mr. J. W. BOWEN: I beg to move, in page 3, line 17, after the word "Kingdom," to insert the words "to the need of area development."
  I should imagine that maiden speeches are very fast losing their popularity and attraction, so far as this Parliament is concerned, at any rate. I can only, therefore, hope to secure the indulgence and tolerance of the House for a few minutes in order to attempt to make a modest contribution. The Amendment is designed to assist the Government and not to retard the progress of the Measure. My difficulty, rather, is that there is a connection between my Amendment and Part II of the Bill. The right hon. Gentleman might be able to help me later on as to the drafting of the Amendment in that connection. In considering the Bill before us, and the power to be given to the Treasury, we recognise that in any contribution towards the solution of the problem of unemployment there should be kept in view the next step in a constructive effort. In other words, unless there is some co-ordination or connection in the proposals, there is likely to be failure before the proposition gets very far. The Treasury is, rightly, the authority to secure that co-ordination, but in connection with the vast proposition that is before us in this Bill, and the probability of something more developing, we have to have regard to possible difficulties arising from wasteful competition. I want to suggest that the Bill does not give the Treasury sufficient authority to prevent that. If I may give some indication of what I mean, I should like to ask my right hon. Friend to tell us, in regard to road and railway transport, to what extent competitive schemes will be dis-

  1019
  couraged. Unlimited competition will probably mean the downfall of efforts in the direction of either assisting railways or making roads. The Treasury may possibly find some conflict between business aims and public requirements. Road and railway competition has become notorious, and therefore, when it is proposed that there should be some regard to the development of railways and an extension of road making, it is pertinent to ask whether the Treasury has sufficient power to see to that matter or not.
  My Amendment, I think will help the Government in that connection. Railways and roads are different forms of traction. Roadmaking cannot be denied. Roadmaking, however, can be regarded to some extent as a subsidy to commerce, and, as railways are a national highway for commerce, they ought to be expected to make some contribution to unemployment, because they have statutory privileges; they have public obligations, and they have also moral responsibilities to their own special community. We have seen how they have encouraged the community who have trained themselves and lived and had their being at places like Crewe and Harwich, but in such places there are hundreds of men discharged from their work or on short time; the municipalities are powerless, and the community itself is apprehensive lest worse should befall them. Therefore, the simple question I should like to put to my right hon. Friend is: Will the railways be expected to carry a little more of that burden if grants are to be made? I should be prepared to take some risks, because of the desperate needs of the situation, but I am anxious to get the best results and to encourage the Government in their great task. I think, however, it would be wise of the Treasury to take powers which I do not see in the Bill to ensure that they are satisfied that the need of area development proposed by any public utility company is such as to satisfy them and such as would not lead to further unemployment which competition of a wasteful nature would bring about.
  Mr. THOMAS: Let me first congratulate my hon. Friend on a very able speech giving a very clear indication of his interest in Crewe. I am quite sure that his constituents, when they read it, will
  1020
  congratulate themselves on their wisdom in having sent someone who can so adequately and so early look after their Interests. Therefore, I not only appreciate and understand the Amendment, but I am going to give my hon. Friend reasons why, having made his speech, he should now withdraw the Amendment. I rather gathered that its only object was to see, as far as it is humanly possible, that in all the schemes that are considered some definite object shall be in view. That is to say, if, for instance, you are looking at a dock, the only improvement you would sanction at the dock would be something that would facilitate the shipping at the dock. If you are looking at railways, you will only sanction a development which would tend to the general comfort of the passengers, and ultimately to a cheaper and more efficient transport. When you are looking at roads, you should say, "How many corners can I cut off?" So you go on from stage to stage, and I have it all in my mind, but I am sure it is much too dangerous ground at this stage to ask me to say what will be the balance as between railways and roads. What has to be kept in mind is that improvements are necessary in both. It is not a question of merely assuming that you can use one against the other. It is not a question of assuming that one is better than the other. It is a question of realising that both need improvement and, if that improvement can be brought about simultaneously with finding employment, that, after all, is the only test we ought to apply. My hon. Friend having indicated not only short time at Crewe but pensions for the railway men at Crewe, all of which are kept back by the poverty of the railway companies, he should be able conscientiously to support the Bill, which will bring about efficiency and enhanced prosperity from which the people of Crewe, whom he so ably represents, will be the first to benefit.
  Amendment, by leave, withdrawn.
  The CHAIRMAN: The next Amendment I have to rule out of order.
  Motion made, and Question proposed, "That the Clause stand part of the Bill."
  Mr. CHURCHILL: I have now had a very few moments to consider the effect of the statement the Lord Privy Seal has

  1021
  made, and I am bound to say it confirms the general impression, and the first impression, I formed when the schemes were presented to the House. It shows that he is proceeding with prudence and caution and with due regard to the susceptibilities and the principles and the authority of the Treasury. I must say I think the debate that took place on Friday and the earlier debate, have really been of very great advantage, because we have clearly ascertained, not the final but the immediate limits of the Government scheme for dealing with unemployment and, as I say, those limits are extremely modest, and rightly so, because undoubtedly it would have been easy for the right hon. Gentleman to put a very sensational figure into his Bill, or into his speeches, and then he would have found he would not have been able to spend the money in the time or would only have been led into wanton and wasteful expenditure.
  Therefore, as I say, I think that it is reassuring to the Committee to be in possession of the full statement he has made to us this afternoon. I am very glad that the Government have deferred to the sense of this House now in Committee in placing us in possession of their scheme and of the maximum limit of their scheme as far as the present period is concerned. £25,000,000 is the mass of capital development in respect of which the Government may make grants of interest between now and the next assembling of the House in three months' time. It is quite true that the commitments into which the Government may lead us may extend for as long as 15 years, but even if the commitment is at its maximum of 15 years, as I calculate, the total commitment that can be made in the next three months will not exceed £18,000,000 or £19,000,000 sterling. Taking the 5 per cent. guarantee as covering loans during the whole 15 years within the limit of this £25,000,000 capital development, the total amount will not exceed £1,500,000 a year, or £18,000,000 or £19,000,000 in 15 years.
  I do not really feel that I have the slightest reason to alter the view which I have taken throughout this discussion, that this is a very moderate and circumspect proposal. There has never been in these discussions any collusion between the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) and myself. [Interruption.] When I say
  1022
  no collusion I expect to be believed. I expressed the opinion which at first sight was, apparently, the only line to take. I wish only to say that although there has been no collusion, in my view there has been no inconsistency. I took the view throughout, and I take it now, in the possession of this much fuller information, that the scheme is ordinary and sagacious. I said that the Chancellor of the Exchequer won the first round, and in my opinion he has won the second round. That is my view. It is true that the right hon. Gentleman the Member for Carnarvon Boroughs drew attention, and I am very glad he did so, to the serious financial vagueness of this particular provision. The Government have met that, and the Chancellor of the Exchequer has acknowledged the advantage of the measure of the discussions which have taken place in the House.
  So that we really congratulate ourselves in both cases. We have a moderate scheme, and we have a correct financial procedure. I am bound to say that I do not see why this limit should not be mentioned in the Bill. The Chancellor of the Exchequer certainly spoke of the subject as if the £25,000,000 could be inserted in the Bill, naturally only of a temporary character, but the Government do not feel that they wish to make an insertion. I should not wish to press them unduly. I am very anxious that they should feel that we have not hampered them in any way in their treatment of this great problem of unemployment. We have never sought to impose a limit upon them. We have asked them to express their view as to what the limit should be. That was their responsibility. They have acted up to their responsibility, and they have told us what the limit is, and for my part I think that it is a very moderate limit. I am bound to say that I do not think they could possibly have adopted a more modest limit as far as this coming period of three months is concerned.
  It only remains, as far as this House is concerned, to wish the right hon. Gentleman success in spending wisely and judiciously these limited sums to which he has now the power to commit us. But, before this Clause passes from us, and now that we have before us the limit of the Government scheme, I must reiterate my opinion, which I have expressed several times, that the effect of

  1023
  these schemes upon the volume of unemployment will be utterly negligible. However skilful the right hon. Gentleman does his work, however shrewdly and thrifty he makes his bargains, whatever competent business men he calls to his aid, I must express my conviction that whatever the future course of the unemployment figures may be, they will not be appreciably influenced or affected by anything he has proposed in this Bill, not only in the next two or three years, but during the whole course. The levers which are being applied may be well polished and placed in the right positions, may have heaving upon them the full strength, energy and adroitness of the Lord Privy Seal, but they are levers which are miniature levers. They are not capable of moving this vast mass. We have heard of using a steam-hammer to crack a nut, but it is the other way round. He is throwing a nut into a steam-hammer. I cannot imagine anyone believing that proposals on this scale, however useful they may be in some respects, will be a solution of this hideous problem of 1,200,000 persons unemployed which has played such an immense part in all our political and social controversies, and is undoubtedly the main preoccupation of all who are responsibly concerned, in Office or in Opposition, with the affairs of this country. No, Sir, the evil is gigantic and the scheme is modest in the extreme.
  I do not blame the right hon. Gentleman for the course which he has taken. More especially do I think that he has a right to proceed with caution when there is, to put it mildly, very grave doubt as to whether even modest applications will produce modest results, when there is very grave doubt whether the launching of the scheme will have any effect whatever upon unemployment, and will not create as much unemployment by a transference of credit from other quarters. There was a battleship which sank in the Mediterranean many years ago and they endeavoured to raise it, but after six or seven weeks they found they were pumping the Mediterranean in and out of the battleship which was sunk, and it may well be that the. Treasury view, which has so consistently been put forward in the many discussions which have taken place since the War, is
  1024
  economically correct. As I have said, I am not in a position to range myself in absolute endorsement of that view in its entirety. I think that the efforts which all of us have made under every Government that has taken place since the War to try to mitigate unemployment by favouring and fostering public works and stimulating enterprises preclude me from taking that view in its entirety. The right hon. Gentleman might perhaps say that there is no such thing as a Treasury view, and that there is only the Chancellor of the Exchequer's view. I do not think that is true. Where it is a matter of politics, of course, only the Minister is concerned, but where you come to highly technical matters, whether connected with the defence forces or with finance or with public health, in some respects, in regard to these technical matters, apart from political matters, the view of these expert officials, who give their whole lives to the study of these questions, is a matter which acquires an independent and separate validity.
  Mr. E. BROWN: Does it not matter how the questions are put to them?
  Mr. HOLFORD KNIGHT: A validity independent of Parliament?
  Mr. CHURCHILL: I do not understand that. The point is, what is the truth. The question is, can you by borrowing money and spending it upon public works, diminish the volume of unemployment? If you can, then everyone will be very glad, and we will support the Lord Privy Seal's scheme with greater confidence than we do. If you cannot then, of course, it is no use encouraging hopes amongst unemployed persons that they are going to have relief from their sufferings through the application of a remedy which it is believed will not be effective at all. However that may be, I maintain that the scale upon which the Government proposals have been framed is not of a character to enable any appreciable effect to be made upon this great social evil. I do not intend to press this matter any further, because the right hon. Gentleman has been most conciliatory with the Committee to-day, and the Government have given us further information. I think there is one point, on Report, that I will speak upon when the time comes.

  1025
  Meanwhile I will support the right hon. Gentleman in getting this Clause through.
  Mr. LLOYD GEORGE: I, also, have had an opportunity since the Lord Privy Seal made his statement of considering this matter and of consulting with my right hon. Friends, and with my hon. Friends who are associated with me, and we are of opinion that the Lord Privy Seal has redeemed very faithfully the undertakings given by the Chancellor of the Exchequer last Friday. I have risen to express satisfaction with the statement that he has made. So far as I am concerned, any opposition or criticism which I was directing against this Clause has been completely mollified. I had some misgivings, on merits, about these grants to these companies, but if the right hon. Gentleman says that he cannot find the necessary opportunities of providing work for the unemployed in the coming winter without embarking upon schemes of this character then, whatever misgivings I may have had, I shall certainly not convert my misgivings into an opposition to his proposals. His responsibilities are very great indeed, and it is the business of the House of Commons to do all in their power, within the means at their disposal, to assist him to carry through his great and very anxious undertakings. For that reason, I wish to express my satisfaction.
  May I also express satisfaction at the statement that the right hon. Gentleman made in reply to the hon. Gentleman for Crewe (Mr. Bowen). I have always been a little afraid of the right hon. Gentleman's railway obsession. It is a very natural one and a very honourable one for him, but I have always been a little afraid that he concentrates, in regard to his projects, rather too much upon the railways, to the exclusion of—[An HON. MEMBER: "Roads!"] Not merely roads, but other things as well. There are a great many other things which I hope the right hon. Gentleman is considering, which could provide employment. I was glad to hear him destroy completely the illusion that if you develop road schemes you necessarily do harm to the railways, or, on the other hand, that if you develop the railways you must necessarily injure the roads. The roads and the railways are both
  1026
  partners in a great undertaking, assisting each other in the transport facilities of this country, and I was very glad to hear the right hon. Gentleman say so. It will completely dispose of a great many arguments which I heard during the General Election, in criticism of certain schemes with which I was associated.
  With regard to what was said by my right hon. Friend the late Chancellor of the Exchequer, I fundamentally repudiate everything that he said. I utterly disagree with everything he said, except that he accepted the Lord Privy Seal's proposals. I think that what he said was heresy of the most indefensible character. The idea that if you spend money in this way you will not promote employment and that you may really prevent useful employment in other directions, is a doctrine which I never heard of outside the Treasury, and that doctrine was engendered in the Treasury during the time that it was presided over by the right hon. Gentleman. I certainly never heard of it in the past. When I was Chancellor of the Exchequer, I was responsible, with the full sanction of the Treasury, for setting up the Development Board. It is perfectly true that at that time we did not get as much cash as I should have wished, but I never heard the doctrine put by the Treasury that you might not use national credit for the purpose of developing agriculture and other industries. What is true of agriculture must be equally true of other industries, if there is no credit that you can get without the assistance of the Treasury. The real point is, whether you are spending money for the purpose of making employment, for some purpose of re-equipment and reconstruction and for something that enriches the nation, or whether you are throwing your money away.
  Mr. CHURCHILL: I should be misleading the Committee if I ever suggested that the Treasury view is that no development should be done by public money. What I said was that development by borrowed public money would not be beneficial in reducing unemployment.
  Mr. LLOYD GEORGE: I think the right hon. Gentleman went far beyond that. He gave the extraordinary illustration about the derelict battleship, and about pumping the same water in and out. If you were able to raise some

  1027
  treasure by those means, the money might be well spent. The whole point is whether the money which the Lord Privy Seal is asking this Committee to vote is to be used for the purpose of improving the transport of this country, or for the purpose of improvement by means of drainage or by improving the quality of the land, or for any other purpose which enriches the country and makes it a country that will provide useful and healthy employment for the people who dwell here. That is really the whole question. It is not this country alone that goes in for these development schemes. I could provide examples for the right hon. Gentleman where public money has been used in ways of this kind, in the Dominions and in the United States of America, where they are contemplating raising huge sums of money upon public credit for the purpose of assisting agriculture and the commerce of the country. The same thing applies in France, and in Italy more particularly, where there are enormous schemes of land reclamation for the purpose of providing employment for the surplus population. I should be very sorry indeed if any party in this House, and especially the Conservative party, were to commit themselves to a policy like that. It would be fatal to the future of this country with its enormous population and with the growing competition which makes it very doubtful whether we shall recover within the next 10, or 15, or 20 years the necessary export trade to enable us to provide employment. If the Conservative party commits itself to the proposition that public credit is not to be used for the purpose of developing the natural resources of this country, and of the Dominions and Colonies, it would be a fatal day for the prospects of this land. I am entirely in disagreement with the doctrine which I understood the right hon. Gentleman laid down, and I hope that he will take time not merely to consider the proposal of the Lord Privy Seal but also to reconsider that very extraordinary doctrine.
  Mr. THOMAS: I have come to the conclusion that half-past eight in the evening is a much better time for the consideration of a Bill than 12 or one o'clock in the day: the whole atmosphere seems better. Let me say, first of all,
  1028
  that I fully appreciate the late Chancellor of the Exchequer's handling of the situation. He wound up by saying, "You are going to do nothing." In that case all I can say is: "Thank you very much for your support for doing nothing." The right hon. Gentleman has raised an issue which will have to be fought out sooner or later. This is not the time to do that, but I want to say this quite frankly for myself. I am not unmindful of the difficulties but the position shortly stated is this. The right hon. Gentleman says that if you raise £100,000,000, or £50,000,000, the net result will be that credit will be restricted by the banks, and that whatever employment you may find in spending the £100,000,000, it is more than counterbalanced by other industries suffering as a result of the expenditure.
  Mr. CHURCHILL: Unless you spend it to better advantage.
  Mr. THOMAS: My view is that it all turns on how far you can expand your own credit within the gold standard. It turns on that absolutely. There are fundamental differences on this subject I know. The greatest financiers in the City are divided. I have heard excellent views on either side, but if the policy of the right hon. Gentleman is correct, then we have, whether we like it or no, to accept the fact that 1,200,000 men are doomed for all time, unless some unforseen economic change comes to their rescue. If that policy is to be accepted there is an end to this country. The people will not tolerate it; and there is no reason why they should. They would have the right to say: "No, we demand something better, and we are going to have it." I have never represented that this Bill with its limitations is to be taken as the measure of my view as to what is necessary. If it was I should not be worthy to sit here for two minutes. It is not by a long way the measure of what we shall have to do, but it is a step, the first step, and a necessary step, to deal with the problem immediately. There will be many other steps to follow, and they will all cost money. I do not want to deceive the House. But I submit that we are taking a practical step in saying: "Do not let us waste money on unnecessaries." For instance, if our trade is suffering as the result of a lack of efficiency at the docks, which I can show to

  1029
  be the case, that we cannot compete with the foreigner because some of the plant at our harbours and docks is absolutely obsolete, surely anything which will tend to find employment and make us more efficient to compete with the foreigner must in the end be of advantage to the community.
  In spite of all criticisms I am going along that path, and I am going to see how far in the expenditure of public money we can add to the improvement and efficiency of the country as a whole. There will be other stages to follow, which are necessary, and I shall not hesitate to ask the House for its approval. I thank the Committee for the tone of this Debate. I have endeavoured honestly to give all the guarantees that it is possible to give, and I believe we shall be able to do something between now and November. At any rate, I will give a guarantee to the Committee that we will do all we can to falsify the predictions of the right hon. Gentleman and that when we re-assemble in November he will be the first to say: "Well done: I was wrong, you were right." I hope the Committee will assist me in getting the Third Reading of the Bill this evening.
  Mr. E. BROWN: I only want to detain the House for a few moments. I interrupted the late Chancellor of the Exchequer and said that the technical answers you get from technical experts depend on the technical questions put to the technical experts; and if the right hon. Gentleman during the last five years, instead of sitting for the Epping Division, a delightful seat from the point of view of employment, had sat for his old constituency, Dundee, he might very well have drafted his questions about unemployment from an entirely different point of view. No hon. Member who sits for an area in which there is a large number of unemployed will accept for one moment that it is the Treasury doctrine which has been enunciated by the right hon. Gentleman to-day. It may be the Treasury doctrine given to the right hon. Gentleman in answer to his particular type of question, but it is not the whole doctrine and, therefore, private Members hope that the right hon. Gentleman will be kind enough to put his own point of view so that we may be able to deal with it on its merits. Those who have large numbers of unemployed in their con-
  1030
  stituencies understand that this is only a beginning. We take the words of the Chancellor of the Exchequer on Friday as meaning exactly what he said:
  "The House must really understand that any figure that we may suggest cannot be regarded as a final figure. We shall claim freedom to come to the House if we have schemes which we think are practical. We shall claim freedom to come to the House at any time and ask them to increase the figure."—[OFFICIAL REPORT, 19th July, 1929; col. 824, Vol. 230.]
  From the point of view of those who sit for areas where there is grave unemployment the sooner the Lord Privy Seal comes to the House and asks for bigger figures the better we shall be pleased.
  Mr. MUGGERIDGE: It appears to me that one point has been overlooked in this Debate, and I should like to bring it to the notice of the Committee. We are committed to the expenditure of a sum of money for the purpose of aiding many private limited company undertakings. Those undertakings are not run exclusively in the public interest. They are run ultimately to provide a profit, or at any rate a certain rate of interest, for those who have contributed money to them. I am not objecting to that, but I do regret that the House is allowing Part II to go without putting in a precautionary provision such as this: that if we are going to spend the taxpayers' money in refreshing these undertakings, which have not been managed so well that they do not stand in need of the refreshing capital that we are proposing to pour into them—if we are to use the taxpayers' money for that purpose, we ought at least to take the precaution of seeing that when in future we choose to become the possessors, by purchase, of these undertakings, the money that we are spending now in the shape of grants will be deducted with interest from any compensation that is paid to these utility concerns. That at least ought to be guaranteed. Otherwise we are making a very bad bargain for the taxpayers, and we may be forced into the position that taxpayers will be compelled to buy back their own money. I am glad of the opportunity of making my protest, because I can see the time coming when these national utility concerns will become national in the true sense of the word.
  Mr. MACQUISTEN: Provided the expenditure creates assets, there can be no

  1031
  fault in encouraging it. If it is unwisely spent, of course it will be a national loss. I suggest that the Government or the State has assets of its own in which money might be wisely spent before any goes to the outsiders. I can mention an asset in Scotland on which a satisfactory sum might be spent and employment might be given to a large number of men. For 100 years the State has owned a canal at the head of the Peninsula of Kintyre. Although it has belonged to the State, up to 1913 it has always paid its way and has been of immeasurable convenience to fishing craft and small vessels. It is only nine feet deep. As recently as 1913 the route of the canal was surveyed by engineers, who reported that a 20-feet sea canal could be made for less than £800,000, with one lock instead of the 15 that are there now. Such a development would enable reasonably sized ships to use the canal and to save 100 miles of sea journey through stormy waters. The traffic is there, but reasonable facilities are necessary. The scheme would open up a large tract of land for settlement and would provide employment for many thousands of men for several years, and the very class of men to whom we wish to give employment, namely, the miners. Why do the Government not take up a scheme of that kind? There must be many other State-owned assets of the kind in the country. The Government should begin with these. I put a question to the Minister of Transport about this scheme. It would mean not only an improvement in transport, but supplies of fresh fish for the people in Glasgow, better facilities for conveying country produce, and the development of a splendid area on the other side of the canal. It would all be of the greatest benefit to the Scottish people.
  Lieut.-Colonel Sir A. LAMBERT WARD: The Lord Privy Seal asked that he might get the Third Reacting of his Bill to-night. I submit that in the case of a Bill founded on a Money Resolution it is not possible for him to do so.
  The DEPUTY-CHAIRMAN: That is a question which should be raised in the House and not in Committee.
  Mr. SMITHERS: I regret very much that I feel compelled to say a few words. I hope the Chancellor of the Duchy
  1032
  realises that I am anxious that the Government should get the Bill. In all sincerity I am anxious to support any scheme which will help unemployment. I want, however, to refer to a sentence in the speech of the Lord Privy Seal. He said that there were more schemes to come and that they would all cost money, and he added that his policy was to expand the credit of the country as far as he could within the gold standard. Some hon. Members on the other side of the House seem to think that it is easy to raise money, and that the mere raising of it will cure unemployment. I want to thank the Government for coming down to the House and limiting the expenditure under this Bill, and for letting the country see that the Treasury is still using effective control. I want to try to put right a point of view expressed by the Chancellor of the Duchy at a meeting reported in the "Times" of to-day. He is reported to have said:
  "Mr. Churchill and Mr. Lloyd George combined to put a limitation on she amount of money that the Government would spend before the autumn."
  Let me return to the Lord Privy Seal's statement about extending credit within the limits of the gold standard. There is a limit to the amount of money that you can raise, and you may raise it on such conditions that the harm to the unemployed will more than outweigh the good that can be done by putting some men back into work with the small amount of money that you raise. We have talked a lot in the last few days about Treasury control. The Lord Privy Seal said the other day that the Chancellor of the Exchequer for the time being was the Treasury, and was in control. But there is a much sterner and harder master of our financial possibilities than the Chancellor of the Exchequer or the Treasury. I can only explain it as being, owing to our insular position and our complete dependence upon credit, the economic facts prevailing throughout the world. I take it that Treasury control means that when any Government puts up a financial proposal for the examination of Treasury experts, those experts tell the Gvernment how far they can go, and what will be the result of that particular financial proposal. The limit to the amount that any Government can spend is the limit which they can raise without depreciating the price of Govern-

  1033
  ment securities or damaging national credit. We have to-day talked about £25,000,000 under Clause 1 of the Bill and £25,000,000 under Clause 2 of the Bill, and I understand that further grants are liable to be made under Clause 4. Presuming for a moment the sum to be £50,000,000, the State is assuming a liability of £2,500,000 a year in interest, supposing the money to be raised at 5 per cent. or thereabouts. You may get some men back to work, but the Government will put round the neck of the country as a whole—not of the capitalists, but of the country, because it will tend to increase the cost of living to the whole community by increasing taxation—an annual liability of £2,500,000 per annum.
  9.0 p.m.
  I repeat that there is no one more anxious than I am to help the unemployed, but I wish to point out that in raising these large sums of money, we ought to remember our present commitments and make a survey of our existing debts. I have before me the financial statement for this year. When the Government talk of raising large sums of money, I would remind them that in the year 1929–30 there are £65,000,000 of liabilities falling due to be met. In the year 1930–31 there are £134,000,000. In the year 1932–33, £121,000,000; in the next year there are £265,000,000; in the year following that £116,000,000 and so on up to 1947. It is also to be remembered that our total national debt is £7,500,000,000. Let us by all means make-grants, as far as we can afford them, to help the unemployed; but if anything be done whereby the gold standard is affected or our pound sterling depreciated in terms of dollars, then the raising of that money must do more harm than it can possibly do good. Therefore I would ask the Chancellor of the Duchy of Lancaster not to go into the country saying "We could not carry out our schemes because the Opposition would not let us vote the money." Let him rather own up to the difficulties, and be sincere and say that the position and the safety of this country in relation to the world make it impossible to raise an unlimited amount. If we over-borrow or over-tax, we shall create a situation which, far from diminishing unemployment, must tend materially to increase it.
  Question, "That the Clause stand part of the Bill," put, and agreed to.

  Clause 3 (Definition of public utility undertaking) ordered to stand part of the Bill.

    CLAUSE 4.—(Power to make grants to local authorities in connection with development works.)
    The DEPUTY-CHAIRMAN: The first Amendment in the name of the hon. Member for Chislehurst (Mr. Smithers)—in page 4, line 6, to leave out the word "him" and to insert instead thereof the word "her"—I must rule out of order on a question of interpretation. An Act of Parliament cannot be altered every time there is a change of Minister.
    Mr. SMITHERS: I beg to move, in page 4, line 6, to leave out the words
    "him with the approval of the Treasury for purposes of this Part"
    and to insert instead thereof the words
    "the Treasury for the purposes of Part I."
    I move this Amendment in order to ask the Chancellor of the Duchy of Lancaster to explain why two committees are necessary to control activities under this Measure—one for Part I and another for Part II. No doubt the right hon. Baronet will be able to give good reasons, but it would appear on the face of it that in dealing with a big national question of this kind it would be better to have one committee to review the whole situation as regards trade facilities grants, grants to public utility companies and grants to local authorities. It would seem to be better to have one committee, if possible, to make a survey of the whole country, to take into account the Treasury view as to raising money and to be able to say, "We are in a position to give so much in trade facilities grants, so much to the public utility companies, and so much to local authorities." Is it not possible to have one committee?
    Mr. CHURCHILL: I think it would be convenient if I put to the right hon. Baronet another question which arises on this matter. We have been told that the limit of £25,000,000 is applicable to Clause 2, but I am not quite clear as to whether or not it also covers expenditure under Clause 4, and perhaps the right hon. Baronet in his reply will make that point clear.
    The CHANCELLOR of the DUCHY of LANCASTER (Sir Oswald Mosley): I think my right hon. Friend made it quite clear that the limit to which he referred related only to Clause 2 and not to Clause 4. As the right hon. Gentleman is aware, Clause 4 merely gives statutory authority to the existing work of the Lord St. Davids Committee which will be carried on in practically the same way as hitherto. The undertaking of my right hon. Friend in no way related to Clause 4. The Amendment which the Committee is asked to consider will have the effect of handing over the work under Part I of the Bill, as well as under Part II, to the same Committee, and that is not considered to be desirable, because the two Parts of the Bill relate to very different kinds of work and undertakings, for the consideration of which different qualifications would very often be necessary. It is proposed to meet the point raised by the hon. Member by establishing a liaison between the two Committees, by appointing one or more members who might be members of both Committees. To give one Committee the task of reviewing both Parts of the Bill not only would impose too great a strain upon that one Committee, but also differences in composition would make the proposal impracticable. I hope, therefore, the hon. Gentleman will see his way not to press his Amendment.
    Mr. SMITHERS: It is proposed that Part II should be worked by the St. Davids Committee?
    Sir O. MOSLEY: It is the same procedure which has hitherto been dealing with that work.
    Commander WILLIAMS: I rather agree with the hon. Member for Chislehurst (Mr. Smithers) that it would be better if you had one single head Committee to deal with the whole of these questions, divided, if you like, into two separate sub-committees. When you have two different Committees, with merely one or two members belonging to both, it seems to me quite clear that you are not really co-ordinating these schemes so as to have one big national scheme. I say, quite frankly, that it is a great pity that the Chancellor of the Duchy could not have seen his way at any rate to consider, between now and the Report stage, whether it would not
    1036
    have been better to organise one first-class, strong Committee to deal with unemployment as a whole, and then divide it into sub-committees to deal with the two different lines under the Bill. We have heard a certain amount to-night about the financial side of this question. It may well be that one side or the other during the next few months may prove of greater advantage, and whichever side does prove to advantage, then: is bound to be a certain natural jealousy between the two Committees. At the end of three or four months, when the Lord Privy Seal comes to us again, he would be in a much stronger position if he could come with the assurance, at any rate by that time, of having amalgamated the two Committees.
    Sir H. YOUNG: The answer of the Chancellor of the Duchy to my right hon. Friend the ex-Chancellor of the Exchequer leaves me in some little doubt. The Clause with which we are dealing says that the Minister may, on the recommendation of a Committee, make certain grants. I understand the hon. Gentleman to say that no limitation exists, because under this Clause the Ministry of Labour will only be carrying on transactions of the same nature as those carried on by the St. Davids Committee. The Committee, under this Clause, is not necessarily the same, I understand. I rather gathered that the intention was that it should be a new body. I do not know what the intention is, but possibly the hon. Gentleman could enlighten us about that.
    Mr. THOMAS: If there is a doubt as to whether there is any intention to change the St. Davids Committee, I can say that there is no intention of changing the personnel of the St. Davids Committee.
    Sir H. YOUNG: That removes a possible doubt under the wording of the Clause. It follows that the actual personnel of the Committee will be identical, and I am sure that all those who are acquainted with the very admirable work done by the St. Davids Committee will be glad that there is no doubt on that score. The doubt left in my mind by the answer of the Chancellor of the Duchy was this: He said there was no necessity for a limitation in amount because the transactions would be similar. Does it

    1037
    follow from that reply that whatever limitations attach to the expenditure of the St. Davids Committee at present will also attach to the expenditure under this Clause?
    Mr. THOMAS: In regard to the personnel of the Committee, the hon. Gentleman could not have heard the ex-Chancellor of the Exchequer a few moments ago. So far as appointing one Committee is concerned, it would lead to an absurd situation, which must of necessity break down, but, on the other hand, one can foresee that it would be unwise not to have some kind of liaison between the two Committees. Incidentally, let me say that these Committees must for the next few months, by the very nature of things, be in an experimental stage, but in order to avoid that very point, I have decided that I will ask a member of the St. Davids Committee to join the other Committee, and that in itself will form the liaison and relieve that difficulty. With regard to the other point, as my hon. Friend has pointed out, here again it is a continuation of the work. Originally the St. Davids Committee was set up, and a certain sum was mentioned. Here again I can give the same assurance on this Clause as I did before. I have discussed the whole matter since the Debate on Friday, and I undertake in precisely the same way to name the same figure in this case as in the other, so that there can be no difficulty. Then, when the House reassembles in November, we ourselves will put down Votes—
    Mr. SMITHERS: Another £25,000,000?
    Mr. THOMAS: Yes, so that, in other words, you will have three £25,000,000. I anticipated that someone might ask during the Debate whether the same assurance could be given, and in order to anticipate that, I have come to the conclusion, and now say, that the maximum expenditure, on precisely the same conditions, namely, temporary expenditure, will be £25,000,000 for each, or £75,000,000 in all.
    Sir H. YOUNG: I am very much obliged to the right hon. Gentleman, who has elucidated more even than I asked in my question, because he has now told us that there is to be a third limitation of £25,000,000 applying to Clause 4. I understand that this also is to be a limitation upon the nominal capital sum,
    1038
    but not of the actual grants which may be made out of the Exchequer, and I think attention ought to be drawn to the difference, because this House is wont to be a careful guardian upon the control of actual grants from the Exchequer, and we have to observe that the limitation which the right hon. Gentleman has given is not a limitation upon possible grants out of the Exchequer, but an indirect limitation which may have some possible effect in checking those grants, which is a very different thing. Finally, I believe that he has removed a slight doubt which was raised by the answer of the Chancellor of the Duchy of Lancaster, because I understand from the right hon. Gentleman that the Committee which will carry on the work of administering these grants—which he tells us will be the same Committee as at present existing, with a possible liaison connection—will operate under the same limitations as the other Committee.
    Mr. THOMAS: I announced to the House the amended conditions when I dealt with the question on Second Reading, and I have altered the period of acceleration and the percentage under these changed conditions.
    Sir L. WORTHINGTON-EVANS: May I ask whether under existing conditions there is power to pay interest out of capital during construction, because under these conditions, and the proviso beginning in page 4, line 15, power is taken to pay interest out of capital during construction. Is that a new condition or not?
    Mr. THOMAS: No, I do not think that it is.
    Mr. WOMERSLEY: It is not so far as the Lord St. Davids Committee have worked in the past.
    Mr. SMITHERS: In view of the concession which the Lord Privy Seal has given us for this liaison between the two Committees, so that they may know what is going on, I beg to ask leave to withdraw my Amendment.
    Amendment, by leave, withdrawn.
    The CHAIRMAN: I am not quite sure about the next Amendment in the name of the hon. Member for Middlesbrough, West (Mr. Kingsley Griffith). I do not

    1039
    see how the words which he proposes can be incorporated in the Bill, but I will hear what the hon. Gentleman says.
    Mr. KINGSLEY GRIFFITH: In view of what has been said from the Government Front Bench, it would be wasting the time of the Committee to move the Amendment. I therefore do not propose to move it.
    The CHAIRMAN: The next Amendment in the name of the hon. Member for Chislehurst (Mr. Smithers) is out of order, as it is not in accordance with the Money Resolution. The hon. Member is asking to take words out which are incorporated in the Resolution. The subsequent Amendment—in page 4, line 36, to leave out the words "otherwise than for profit"—also goes beyond the Money Resolution.
    Motion made, and Question proposed. "That the Clause stand part of the Bill."
    Mr. EGAN: Before this Clause is finally approved, I would like to appeal to the Lord Privy Seal to give consideration to a point which I think will be useful to him. He is appealing to local authorities to put forward schemes, and there is one important scheme which public authorities are anxious to adopt, but, owing to lack of finance, very much hesitate to undertake. I refer to the provision of water. The Lord Privy Seal might take into account the fact that only the greatest of our cities can possibly make provisions for big schemes. My own town had a scheme estimated to cost £750,000, but, owing to the War, the cost went up to £1,500,000, and we now hesitate to embark upon it, although there is a growing demand and the gathering grounds are there, unless we are assured of very great assistance from the Government. I need hardly labour the importance of water both for industrial and domestic purposes. This morning, we have passed a Housing Bill which will compel every house built in future to have some provision for baths. That means that there will be an ever-growing consumption of water, and municipalities will have to make provision for that growing need. The simplicity of the scheme which I am suggesting lies in the fact that it will not enter into competition with any other trade.
    1040
    I am asking that the Government will give a lead to the municipalities by making provision for reservoirs. It would be a great benefit in starting employment, and the men could be easily conveyed to the different areas that would be marked out. Agricultural workers, miners, and men in the distressed areas are ready and anxious to help, and they can be brought within easy reach of this work. The great danger that would follow to the health of the country from a shortage of water would bring the whole House in accord in this matter, and this is a scheme which they would wish the Government to take in hand. I believe that the facilities which the Government are extending from Scotland to Cornwall are so easy of approach that some such scheme as this would mean thousands of men being taken off the unemployment register in a short time.
    I appeal to the Government to give consideration to another point. Even now, 10 years after the war, we have men suffering from chest troubles, and there are no sanatoria for them. If these men were taken on to the hill tops, it is probable that the change of air, as of employment, would do a great deal to save medical expense. It is still due to the men that we should take every precaution to save them from the evil effects of the War. I only intervened to appeal to the Lord Privy Seal that, in considering these matters with local authorities, if he could give an indication to them that the Government would take the lead by making reservoirs, and afterwards arrange with the different local authorities to take their supplies of water from them, it would go a long way to giving thousands of men employment and making a necessary provision for the health of the country.
    Mr. THOMAS: We appreciate the remarks of my hon. Friend, and I am delighted to find that anybody associated with Birkenhead is such a strong advocate of the provision of water. I am sure that Birkenhead will be as grateful to him for bringing public attention to this important matter as I am. Curiously enough, I was considering this matter this morning, and have taken steps to invite those responsible to come and see me,

    1041
    and for a very sufficient reason. I think I am correct in saying that the situation at this moment is so serious that, unless there is a break, large numbers of men and women will be thrown out of work. I am not dealing with the danger of the water supply for health purposes, but actually from the standpoint of employment. One could hardly use sufficiently strong language to express the dangers that may arise from a serious water shortage in this country. One remembers that it is the wettest place in the world, and you have only to read the warnings every day. The first thing that occurred to me was that surely here was a fruitful field both for employment and public health. After all, the municipalities and other public bodies are very largely responsible for this important question, but there is a Government responsibility as well. If there is any real danger in the end, the country will expect the Government to take some action. Therefore, I am not only considering it from the standpoint of public health and the interests of the community, but I am also considering it in its particular and peculiar relationship to my immediate problem. Therefore, without prejudicing or anticipating any negotiations, I do say to the hon. Member that I appreciate the object which he has in drawing the attention of the Government to this matter. It is not being lost sight of, and certainly the necessary steps will be taken to deal with the situation.
    Mr. LEIF JONES: I do not want to detain the Committee, but I must be allowed to express my satisfaction at hearing the statement of the Lord Privy Seal that he is going to set in hand the provision of water supplies for this country. Nothing is more urgent, because there is hardly a village in the country that has a really proper water supply. In my own constituency in Cornwall, one village after another village during the election asked for help, so that they might get their water supply. The necessity for it is recognised by every hon. Member. The modern standard of health and cleanliness and sanitation calls for a good water supply everywhere. I need not emphasise it. What I do emphasise is that it is especially fitted to meet the requirements of the Lord Privy Seal. It can never be done except on a large scale and by Govern-
    1042
    ment help and interference. The villages in the rural districts are too poor to pay the cost of a water supply, with the best will in the world. In my own district in Yorkshire, I have been trying to get a water supply for villages for over 30 years. We have had various schemes brought forward, and they always break down in the end over the terrific expense which would fall on the local ratepayers if they were carried out. Now is the moment. You want work and the villages want a water supply, and, with the help of the Government, the local authorities will be able to carry out these schemes. I am most thankful to hear this statement of the Lord Privy Seal. I must express my gratitude for a wide water supply scheme in my own constituency for which sanction has been given. The work is proceeding. The Government gave sanction last week, and it is being proceeded with. This could be done all over the country very quickly and would give employment and add immensely to the wealth of the nation and be a national asset. You can confer no greater boon on the villages of the country than by pressing on these schemes in every possible way. I thank the Lord Privy Seal for what he has said.
    Mr. WOMERSLEY: This has been an interesting discussion about the water supply, and I should like to point out to the last speaker that the scheme to which he refers received sanction under the Circular and the scheme that was issued by the late Government. I should like to point out to the hon. Member for North Bristol (Mr. Ayles) that his authority and any other authority could have come to the Lord St. Davids Committee long ago and have got a grant towards an improved water supply if they had eared to do so. It is no new principle that is being introduced, excepting that, if I rightly understand it, the Lord Privy Seal now states that he is prepared to bring forward schemes which will make the Government responsible for the water supply of the whole country.
    Mr. LEIF JONES: The application was sent in to the committee some time ago, and what the Government have done is to quicken up their action.
    Mr. WOMERSLEY: I have had a good deal of experience of the committee, and I do not accept the right hon. Gentle-

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    man's statement for a moment. If he is to give credit for things, he should not give credit for what has not been done. The Lord Privy Seal is going about his job in a right and proper way, but I do not think he wants to take any credit for what the late Government have done in this matter.
    Mr. JONES: I was informed by the clerk of the local authority that this scheme had been sent in some time ago, and part of it—the sewage disposal part—had been sanctioned, but that was useless unless at the same time they get sanction for the water scheme. It might have done more harm than good. They were held up, because they could not get a decision from the committee. Representations were made to the committee about a fortnight ago, and I am happy to say the scheme has now been authorised.
    Mr. WOMERSLEY: I am very interested in hearing the right hon. Gentleman's story. It brings us to this point again. It would not be the Lord St. Davids Committee who would be holding this matter up. It would be the Treasury. [Laughter.] I can assure hon. Members who are laughing that when they bring schemes to the Lord Privy Seal he has to go to the Treasury for sanction, and he knows as well as I do that he will be up against a problem when he reaches the Treasury. I rose merely to point out that it has been possible for some considerable time now for local authorities to get considerable assistance toward any scheme for improving the water supply of a district, and I want to ask the right hon. Gentleman a straight question. Does he intend the Committee to understand that he is considering the taking over of the responsibility for the water supply of this country by the Government instead of leaving it as at present for the local authorities?
    Mr. THOMAS: I never suggested anything of the kind, and it would have been absurd for me to make any such statement on the lines indicated.
    Mr. WOMERSLEY: Then what will be the difference between his scheme and that of the late Government?
    Mr. THOMAS: I will tell the hon. Member in a sentence. If any local authority or anyone else responsible for the water supply of this country cannot satisfy me or my experts, who will have to be the judges, that adequate provision is made, then it will be for the Government to take steps. On the other hand, I do not think that would be the situation. My own view is that a number of bodies are handicapped and prevented from doing what they desire, and if after seeing them steps can be taken to assist them that is the line that will be taken and no other.
    Commander WILLIAMS: I do not wish to follow the Lord Privy Seal on this particular question of the water supply, although I would like to congratulate him on his singularly charming speech on this subject. I think it is only a pity that the Noble Lady the Member for the Sutton Division of Plymouth (Viscountess Astor) did not happen to have the privilege of hearing him. Neither will I deal with the very curious and interesting claims of the right hon. Member for Cam borne (Mr. L. Jones), because I do not think they are very relevant in this instance, but I would like to say a word about the Clause as it stands. We have-learned during the pasasge of the Clause that there are to be three distinct and large sums of money raised. That is an interesting position which we shall have an opportunity of going into more fully on other stages of the Bill. As various hon. Members have taken the opportunity of putting different projects before the Lord Privy Seal, may I draw his attention to others which I think will be of considerable value to him?
    Very important development work can be done in connection with some of the smaller fishing harbours round the coast. Some of them require dredging and some of them are in need of repair. Considerable work has been going on during the last few years, and all I would ask him, now that he has a vastly extended sum of money with which to help these public works is to see that these undertakings get their share of the money. I hope he will look upon them with at least as much favour as did the late Government, which did a great deal to help in regard to west country harbours. I speak from a rather peculiar situation, not only as the representative of my own Division but also as

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    the representative of a vast number of fishing villages over the whole west country with which we have been in close touch for many generations.
    Mr. R. RICHARDSON: I am delighted to find that the Lord Privy Seal has taken up the question of water supply, but I would ask him to look at it from a still wider point of view. It is not satisfactory for local authorities to have to supply water for their own areas. Many of them cannot afford the money to extend their area for catching water, and many people in those localities have to do without water for days together. The water is also cut off from 6 o'clock at night until 6 o'clock in the morning, and thus not only are households hampered but in some cases work is at stake, because water cannot be found to generate steam for the raising of coal and for other industrial purposes where works are operated during the night. I ask him to consider having schemes for wider areas. It is a hopeless undertaking for such areas as that mentioned by the right hon. Member for Camborne (Mr. Leif Jones) to undertake this work single-handed. They can only get their water with the help of others. I therefore urge on the Lord Privy Seal to look at the water supply question from a national point of view. We must not
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    continue to waste water in the way we are doing. There must be co-ordination, so that there may be water for all, and not for a few only. This is one of the things which will give more employment in relation to the money spent than almost any other proposal. I know I am pushing at an open door in this matter, and I trust the Lord Privy Seal will take action on the lines I have indicated.
    Question, "That the Clause stand part of the Bill," put, and agreed to.

  Clauses 5 (Provisions as to manner of making and fees on applications), 6 (Duration of powers), 7 (Expenses of Committees) and 8 (Short Title) ordered to stand part of the Bill.
  Bill reported without Amendment; to be read the Third time To-morrow.
  The remaining Orders were read, and postponed.

  ADJOURNMENT.
  Resolved, "That this House do now adjourn."—[Mr. Hayes.]
  Adjourned accordingly at Sixteen Minutes before Ten o'clock.