HC Deb 10 March 1930 vol 236 cc951-1010
Mr. LLOYD GEORGE

I rise to call attention to the present position of unemployment in this country. The time has arrived when the House ought to review that position. The Government have been in office between nine and 10 months. When they came into power the unemment figures were [HON. MEMBERS: "Power?"]—do not let us quibble about anything like that, when they came into office—1,100,000 in all. The latest figures are 1,539,300. The figure of 1,100,000 was regarded as very all arming.

Mr. J. JONES

It was 2,000,000 when you were in office.

Mr. LLOYD GEORGE

Yes, but I brought it down by 500,000, and you have put it up by 400,000. [Interruption.] I hope we are going to have a fair Debate. Surely this is a matter that concerns everyone. I repeat that the figures were regarded as alarming at that time—so alarming that not merely the Members who sit on the Liberal benches, but those who are now sitting on the Government benches, made a feature of the extraordinary number of people who were still unemployed after nine years. The right hon. Gentleman the Lord Privy Seal, when he undertook his very onerous and very difficult task—I am perfectly certain he has the sympathy not merely of the whole House but of the country in his extraordinarily difficult duty—appealed, and rightly so, for patience. I think that he said in so many words that no impression would be made on the figures until the month of February. He led us to believe that by February there would be a definite impression made upon those alarming figures. I am sorry to say that the figures are 147,000 worse than they were this time last year. They are 200,000 worse—this may be of some use to hon. Members who have interrupted me—than they were when I left office. The right hon. Gentleman must be disappointed, and he would be the first to admit it. That disappointment is shared by everyone in the country.

I think the time has come for a very candid and fearless review of the whole position, not so much in a spirit of criticism or of censure, but, if possible, in a spirit of helpfulness, and, if I may call it so, in the spirit of converting the House into a Council of State. The House of Commons cannot escape responsibility. I have heard many Debates on unemployment in this House, and I think hon. Members will agree with me that if any stranger had come to the House and had seen what was going on, he would have thought that the Debate was some topic of no particular importance, because of the atmosphere of boredom in the House. The House has generally left this matter to the Government of the day; it has never shown any responsibility as the High Court of the nation, examining grievances and the relations of the problem, and insisting upon remedies being applied. The time has come when the House of Commons ought to shoulder its supreme responsibility in the matter and insist that action be taken. At the present moment we can examine the matter in a spirit of tranquillity. On Thursday next he shall have all the heat and fumes of controversy; we shall all descend together again to the old fiscal crater. I understand that it is beginning to show signs of eruption. That will be the arena. It is not a good atmosphere in which to examine a problem of this kind.

I am not venturing to say anything that would be regarded in the least like censure. I am only saying that it is far better to examine a problem of this kind when you are free from any of those controversial issues, and for that reason I am not going to conclude my address by moving a reduction of the Vote. The House should take counsel together and act authoritatively. The Lord Privy Seal, everyone will admit, has worked hard. No one can accuse the right hon. Gentleman of any slackness. He has thrown himself with all the energy of which he is capable—there is no man who can show a more explosive energy when he likes—into the examination of this problem. If I were to make a criticism of him it would be this that his action has been too lop-sided. He has concentrated upon one particular aspect of the subject—and I am glad that he has attended to that—and that is to effect what he regards as a permanent remedy in the industries of this country by achieving further efficiency in those industries. But what the right hon. Gentleman has overlooked is that there is a temporary problem which has to be attended to as well as the permanent one.

The right hon. Gentleman in concentrating on rationalisation and in giving thought to other remedies, forgets that by that very process he is increasing the temporary evil whilst he is finding no remedy for it at all. I go beyond that and say that some of the remedies which he is applying to temporary conditions are of a character that will contribute to the permanent efficiency of the industries of the country. Otherwise they would be no use. But the right hon. Gentleman, as far as those remedies are concerned, has taken too narrow and too limited, and I think far too timid, a view of his responsibilities. I think he has treated the matter as if conditions were normal, and has forgotten that he is dealing with an emergency. Effective steps have not been taken to overcome emergencies. I shall point out later that I think he could have taken more effective steps to overcome delays, even in those remedies which he himself has sketched out. They are not delays of his Department, but delays in all sorts of things, in Whitehall, in municipalities, in corporations, and, above all, when dealing with lawyers and engineers and surveyors and all sorts of people who have to be brought in before a start could be made with any of the projects which the right hon. Gentleman has initiated. There is too much on paper. You cannot make roads or railways out of that.

4.0 p.m.

I would like to review what I consider to be the present position, as far as trade and employment are concerned. I shall invite the right hon. Gentleman, if he will, to give his view to the House, because he is in closer contact with information than I am. But I have made some inquiries. Trade depression and unemployment are world-wide. They are not dependent, as far as I can see from a survey of the situation, upon any fiscal system. You have got it in Germany; you have got it in the United States of America. Figures vary from the particular point of view of the person who is arguing for the time being, but, at any rate, there is general agreement that unemployment in these two great Protectionist countries is very alarming. In Germany the figures are over 3,000,000, and in the United States of America they are given at between 3,000,000 and 5,000,000. As far as British trade itself is concerned, I do not think there is any cause for anything in the nature of panic. I cannot see any symptoms of decline in British trade as a whole. It is perfectly true, when you take some of the more important industries in this country, that the country is suffering very considerably, but, taking trade as a whole, as far as I can see, so far from there being a decline, there has been a steady progress. World trade, of course, has suffered a good deal as one of the results of the War, but world trade is making progress. All that you "an say about it is this: The progress that international trade is making is not comparable with that which it was making before the War. The ratio of increase has slowed down very considerably, and our proportion of it is not quite what it was, but, as far as I can see, taking the figures for a number of years, our export trade has increased. One has to reduce the figures to something which is comparable, because the values fluctuate very much from year to year, but my recollection is that during the year 1920, which was the lowest period of our trade, we had recovered something like 50 per cent. of our international trade. Last year we had recovered up to 85 per cent. That represents a very substantial progress in the course of nine years, and, therefore, there is no reason to feel that sense of despondency and panic which would come from an indication that this country was losing grip of this great trade.

There are several other factors which one must take into account. I ventured to call attention to them once before, but I think they are worth emphasis once again. We are the country with the greatest international trade in the world, and, therefore, we are more dependent on international trade than any other country. Take our great rivals. The United States of America have a population of 40 per square mile. France, a very prosperous country, has a population of 192 to the square mile. Germany has 345 to the square mile. We in Great Britain have to maintain a population of 481 per square mile. Therefore, when there are any difficulties in international trade, we naturally feel it far more seriously than any other great country in the world. There are only two other countries of which I think it worth while to give figures, because they contain a lesson. Holland has 605 to the square mile, and Belgium 674. Neither of those countries by the way—it is quite incidental—has high tariffs; Holland is substantially Free Trade, and Belgium more so than it was before the War. But I am not calling attention to that. They are the only two countries which have developed their agriculture and their industrial side simultaneously, concentrating and using the whole of the power and credit of the State for that purpose. That is worth our while remembering when discussing the problem of unemployment in this country.

The balance of our foreign trade last year, I see from the paper which has just been issued by the President of the Board of Trade, including our invisible exports, was £150,000,000 in our favour, which is £40,000,000 more than it was in 1927. In addition to that, as far as I have been able to ascertain, and I have made careful inquiries, every year there is a balance of savings which amounts to a very considerable sum, which is available for investment. That is not a matter to be overlooked when you come to the remedies for unemployment. But take any test. There are none of those symptoms which accompany a decline or a decay in a nation. Clothing is better, and so, on the whole, is food. People certainly consume more expensive food. There is more travelling. There is more spent upon amusement. Then as to houses. I was talking to a very distinguished gentleman whom I met with the Prime Minister the other night at the Foreign Office. He had been here up to the beginning of the War, and then had left and came back, I think, to a Conference over which the Prime Minister presided. He said to me, "The change that I find in this country is not so much in London as outside. What staggered me when I drove outside was the numbers of new houses that are going up." No one can look round without finding very beautiful houses all over the country. The population is better housed, and, although it is true that houses are subsidised, they are occupied. That really counts. When you have symptoms of decay and decline in a country, you can see the thing crumbling. There are none of those symptoms in this land. An hon. Friend of mine the other day was talking about the distributing trades. The increase in the number of people employed in the distributing trades is very significant. You must have something to distribute before you can employ more people there. [An HON. MEMBER: "Foreign goods!"]

I will come to an observation made by my hon. Friend. He took the number of multiple stores and their prosperity in the South of England as a proof of increased luxury in the South at the expense of the North. The multiple stores are not maintained by people who buy luxuries. Had it not been for the working population of this country, those multiple stores would all have been in the Bankruptcy Court.

Mr. WISE

I was drawing attention, not to the multiple stores, but to the great West-end emporiums, which mainly supply goods which the working-class do not buy.

Mr. LLOYD GEORGE

I was using the very words of my hon. Friend, but I will take even those emporiums. The hon. Member would be amazed to find the percentage of goods sold to people who are not of that class, and I have made inquiries about it. Had it not been for what they do sell to people of that class, I doubt whether some of them would pay a dividend. You might take, for instance, the co-operative stores, which are multiple stores. The hon. Member will find that there is an enormous increase not merely in privately-owned but in co-operative stores as well, and I am just putting it to him to cheer him up. At the present moment there is no doubt that there are very disquieting figures. Take the railway traffic returns, which I have always examined, because I think, on the whole they are the best test of whether business is going up or going down. It is true that there is a slight advance as compared with last year in the quantity of merchandise which is carried on the railways. Coal has gone down, for reasons I do not know; but merchandise has gone up, and if that rate of progress is kept, at any rate we shall be better off at the end of the year than we were at the beginning.

As my right hon. Friend knows very well, the most disquieting feature is that with regard to raw material, and it is very extraordinary and very odd that we should be suffering from an over-production of the things we all want. That seems to be the case now. There is over-production of wheat, cotton and rubber. There is not so much of wool. Then there is steel. I am taking raw material for the moment. There is an over production in raw materials as we all know, and that is one of the reasons which are responsible at the present moment for a kind of stagnation in trade. It introduces an element of uncertainty. Nobody wants to buy his cotton at a certain figure when he anticipates that, perhaps, next month, if he waits, that figure will go down, and he will have to sell at the price of next month, and not at the present price, because by that time the raw material will have gone down. Until there is complete confidence that you have touched bottom in respect of raw material, very likely you will not get an upward tendency. But the real trouble—and the Government must face it, though I am not satisfied that the Lord Privy Seal is facing it—is the temporary depression. I have no doubt ultimately the thing will come out all right, because the tendency is upwards definitely. [An HON. MEMBER: "Are you not sorry?"] What a discreditable observation! [HON. MEMBERS: "Withdraw!"] The hon. Member, on reflection, will be ashamed of making an observation like that.

The difficulties are temporary, but "temporary" may mean a few years, and the right hon. Gentleman is there really to deal with that temporary emergency. The first is that we have not yet recovered the whole of our foreign trade, and although gradually we are doing it, having gone up from 50 per cent. to 85 per cent. already, we have really got to get up to 120 per cent., having regard to our liabilities and increased population, to be even on a level with 1913. The second is this—that employment is not keeping up with the increase in population, above all when you take into account the labour saving which is due to the process of rationalisation. I am told by those who know, and I have asked a good many people who have come in contact with these processes, that, on the whole, rationalisation has been responsible, in most of our industries, for a cutting down of 10 per cent. in labour. [HON. MEMBERS: "More!"] I give the figure which has been given to me. It does not necessarily mean a cutting-down of production but, giving the same production, there is a cutting down of 10 per cent. in labour. There are some cases in which, I agree, the cutting down is more serious, but we must take the average over all the trades of the country and I am assured that 10 per cent. is the figure which can be taken on the whole.

This is also very largely responsible for the huge unemployment in the United States of America. Although production has increased labour-saving appliances have been introduced at such a rate—as they always are after a big War, as they were after the Napoleonic Wars—that a considerable number of people have been thrown out of employment, not because production has gone down, but because the methods of production are of a character which saves the actual employment of labour. The right hon. Gentleman—I think rightly so—is quickening that process in this country, because in the long run, undoubtedly, it will lead to more employment. But, although I do not anticipate that 1,500,000 will still remain unemployed, although I anticipate that there will be a considerable reduction, I shall be very surprised if the right hon. Gentleman, unless he takes much more drastic methods than he is adopting now, can get over that refractory 1,000,000. The right hon. Gentleman above the Gangway brought the figure under 1,000,000 for a few weeks, but back it went again, and somehow or other it seems that you are unable to break through this 1,000,000 which is a sort of Hindenburg Line of resistance. I cannot see our getting below it unless some strong definite bold action is taken and that without delay.

How is that surplus of 1,000,000, which you are constantly increasing by your rationalisation, although you may be absorbing it by degrees in trade, to be utilised? How are you to deal with it? I cannot discuss the question of tariffs. I wish I could. It would be much more exciting, but I realise that I should be completely out of order in doing so. The only observation which I would make has nothing to do with the merits of that question. Even assuming that the merits were all on the side of right hon. and hon. Gentlemen above the Gangway—an assumption that staggers one—there is the time problem. You have four very doubtful events to get over before you can get the full advantage of this great, new, united, federated and welded policy.

I am now dealing solely with the question of time and I am trying to prove that this is very largely for us a temporary problem. There is first of all this difficulty. You must get a Dissolution. I do not know when a Dissolution will take effect. [HON. MEMBERS: "Ask your party!"] It depends upon right hon. Gentlemen opposite, more than upon right hon. Gentlemen on this side, either above or below the Gangway. I am very glad that the Prime Minister is here. I have just one quiet gentle word to say to him. I do not know whether he wants an immediate Dissolution or not. If I were in his place I would not—not with 1,500,000 unemployed. It depends entirely upon the extent to which he can impress upon his colleagues the importance of what he said at the beginning of this Parliament, namely, that he meant to treat this Parliament as a Council of State. He is not in a position—and I am very glad of it because I have always thought it was bad for legislation—where all he has to do and all that Ministers have to do is to give orders, knowing that they have a sufficient majority. When they have to consider the opinions of the House as a whole it is a very good thing for Bills, and a very good thing for the quality of the work which we do. If the right hon. Gentleman has been too busy with very big affairs outside to do so recently, will he now just look into that matter and give instructions to his Ministers to carry out the orders which he gave in June last that he means this Parliament to be treated as a council, where we are all to be consulted, where our suggestions shall be taken into account and not as a place where we are to be dragooned.

Lieut.-Commander KENWORTHY

Stop obstructing!

Mr. LLOYD GEORGE

The hon. and gallant Gentleman who knows something about obstructing, knows perfectly well, if he brings that charge against hon. Members on these benches, that he is making a charge which has no warrant in fact at all.

Lieut. Commander KENWORTHYrose—

Mr. LLOYD-GEORGE

Let me finish. I think if my hon. Friends and I wish to engage in obstruction we can do better than this.

Lieut.-Commander KENWORTHY

I have said nothing about hon. Members there. I asked would the House behave in that way? There has been, as the right hon. Gentleman knows, very notorious obstruction above the Gangway.

Mr. LLOYD GEORGE

I am getting away from the point, but perhaps you will allow me, Mr. Speaker, to make an answer to that remark. I have seen obstruction, and I have taken part in obstruction, and if that is the best that hon. Members above the Gangway can do in the way of obstruction, I do not think much of their gifts. I have seen a Clause passed in a single night which in the old days before hon. Members became so degenerate as I understand from the hon. and gallant Member opposite they now are, would have taken at least a week. I do not think that the hon. and gallant Member's remark is a fair remark. But do not let us be drawn away from the point. I am trying to make an honest examination of the position. That is the first event—the Dissolution. The second event which has to be considered is this, that you must secure an effective majority. The third event is that you have to square the Dominions, and that is not so easy as squaring Lord Beaver-brook. You can square him by scaring him, but you cannot scare the Dominions. The fourth is the Referendum. Well, all that must take time and that is the only point I make about it. It must take at least—what? Three, four, five winters, if you take all these events together? Meanwhile you have the 1,000,000 out of work, and you have to deal with that problem. That is why I think something ought to be done to deal with the temporary position.

Then I understand that there is a great memorandum on this subject. I have only seen it in the Press and you cannot depend upon the Press always, if they are, to use the old American phrase, reconstructing. I have seen suggestions that the right hon. Gentleman the Lord Privy Seal and his colleagues, who would be even more responsible than he if this policy were carried out, have been invited to solve the problem easily and by a short cut by giving pensions to everybody over 60. That is a wasteful, extravagant and fantastic proposal. I am going to put in a word for the sexagenarian. What would become of this Government if you got rid of all the men in it who are over 60? There is the Prime Minister, the Chancellor of the Exchequer, the Foreign Secretary. Can you imagine this Government without them? I would say that the rest of them are very much "on appro." [Interruption.] I was going to say that some of them are not shaping very well, but we must wait. Then there is the Lord Privy Seal. By the time he reaches 60 he will have learnt two or three things which he does not seem to know now, and I am very glad to find that he is under the charge and tuition of a very competent septuagenarian, the First Commissioner of Works, who, I believe, has taken him in hand and is trying to teach him some of the elements of this problem. More power to his elbow—if it is the elbow that he uses on these occasions.

I hope, at any rate, that that is not the sort of short cut to which the Government will find themselves committed. It is a prodigious task. It would simply be crushing and it would not answer the purpose. I remember that the ablest generals in the War were over 60. [An HON. MEMBEE: "Was there any?"] Marshal Foch was one of the ablest men who ever undertook a task of that kind. What is it that ought to be done? May I suggest to the Government that they ought to make a real survey of the needs of the nation. [An HON. MEMBER: "You did 20 years ago!"] I daresay, but this is not 20 years ago. We are considering what has to be done now. The State ought to take stock of tasks which, sooner or later, must be undertaken if the efficiency of the nation and the well-being of its people are to be maintained and increased and use its credits and its powers to the full to anticipate and accelerate the performance of these tasks. The Government, in my judgment, have taken much too limited, much too narrow, in some respect much too unimaginative, a view of the scope of these tasks. That is the difficulty. It is really not a question, as the Lord Privy Seal has said on more than one occasion, of spending money in order to find work and employment. If it were merely a question of just ladling out money in order to find a job, I should be entirely in accordance, but the whole point to consider is as to whether it is a job that ought to be done, whether the nation will be better for its being done, and whether you are getting value for your money.

I will give a very summarised survey of what I consider to be the things that the right hon. Gentleman and his colleagues ought to be taking in hand. Take agriculture. We are far behind practically all the Western countries of Europe in the matter of agriculture, and my criticism of the Government from that point of view, is that, as far as I have been able to ascertain from the public Press, there is no representative of agriculture on the Committee for Unemployment. It is a mistake—[An HON. MEMBER: "Chancellor of the Duchy!"]—I do not regard the Chancellor of the Duchy as a representative of agriculture. I remember very well an hon. Gentleman, a scion of the aristocracy, getting up from those benches, some time ago now, very well groomed—we all remember him—and beginning his speech by saying, "Mr. Speaker, I aim not an agricultural labourer." I think the Chancellor of the Duchy could very well say the same thing. I would not regard him as a representative of agriculture, and I do not think that he himself would claim that. There ought to be, on a Committee dealing with unemployment, some live representative of agriculture, and especially if you are looking for permanent remedies.

As I have pointed out already, Holland and Belgium are finding employment for an infinitely larger proportion of people than we are, because they have combined the development of their industrial side with their agricultural side. We have got the richest land in Europe. At least, there is no country in Europe than can compare on the whole with us. Taking acre for acre and mile for mile, this country is the richest, and yet, according to the statistics of the Ministry of Agriculture, it is less productive per acre than almost any other country; we are employing fewer hands per 100 acres, and we are more dependent on overseas for food supplies that we could produce here. You could double the production of agriculture, and you have got a market at your own doors. That is a factor which is well worth considering. it is the best market for agricultural products in the world. There is nothing you can put 2 per cent. on at the present moment for which you could get a secure market except agricultural products.

I think we could do far more at the present moment to employ a great number of our young people, especially in the colliery areas, by putting them into training centres for agriculture. I was rather struck by what an hon. Member, who, I think, sits right behind the Government bench, said the other day in the League of Nations discussion. He said there were 200,000 men in the colliery areas who will never find a job in the mines again. I think that is probably true. Would it not be far better that they should be trained for a development of the great natural resources of this country in the soil? In afforestation, we are far behind, and we have not even made up for the devastation of the War. In reclamation, we are practically doing nothing. In Holland they are reclaiming a tract of territory the size of Oxfordshire. In Italy, I found they were spending enormous sums of money in irrigation, and they propose to put 200,000 families on land which is now being reclaimed. Our canals are less adapted to modern needs than any canals in the world. In telephones, we are the sixth in Europe and the tenth in the world. In electricity, we are still lagging behind.

I am going to come to another branch, which I want to urge upon the right hon. Gentleman the Lord Privy Seal. During this Parliament, although we have put it forward, I have not put a case for it—I should like to have the attention of the right hon. Gentleman to this—and that is roads as a means of finding employment. I cannot understand the reluctance of the Government to putting forward a big, broad, strong programme upon that. One hon. Member, sitting on a back bench opposite, has referred to road development as if you were going to turn people on to stone-breaking. There is nothing that would provide more useful labour, immediately, than a big road development programme. I am afraid the right hon. Gentleman the Lord Privy Seal is suffering a little from the railway obsession—we have all got our professional prejudices—and I want him really to get away from that. It is needed badly.

Let me give one fact in order to show how little the importance of a road programme has been appreciated by the Government. The road transport of this country, including repairs and construction, employ" three times as many men as do the railways of the country. Numbers equal to one-eighth of all the insured population in this country are employed, in one shape or another, on traffic connected with the roads. Some 150,000 of the railwaymen are being employed in delivering their goods from the railways. Still more, employment on the railways is stationary, and I do not think that anything the right hon. Gentleman can do can increase it very materially. On the contrary, employment on the roads is increasing year by year—on road transport. It is not merely passengers, but goods. If the right hon. Gentleman would take the trouble to look at the figures, he would find that the most remarkable growth is not in the number of vehicles, but in the weights they carry. Did he see that letter in the "Times" to-day from a number of very distinguished gentlemen at Oxford? They began like this: The immense increase in the volume of heavy motor traffic passing through Oxford gives rise to great apprehension for the safety of our college buildings. If he goes to any town, like Oxford, which is on some kind of trunk road, he will find the same thing. Coming up today, I was amazed to find the number of lorries on the road, carrying traffic which about 10 years ago it would have been thought incredible would ever have been on the roads, and that is going on. You have doubled the number of vehicles in 10 years, but you have quintupled what you are carrying. Why? For one very good reason, and that is that it is the only way in which a man can command the time and method of delivery of his own goods without being at the mercy or the choice of anybody else. The result is that it is more convenient. Whatever the right hon. Gentleman may or may not do, road traffic is bound to develop at a great rate, and the only question is whether you are going to take steps to prepare for it, to make ready for it

I wish the Minister of Transport were here. [HON. MEMBERS: "He is."] I am very glad to see him, but I wish he were not so far on the side, because that is what I am rather afraid of. He will bear out what I say now, that there is no part of the country where there is not an urgent demand for widening roads, for straightening roads, for new bridges, for by-passes, for tunnels at level crossings, and for trunk roads. Every county is in that condition. A rather important technical journal for engineers, dealing with roads and road construction, says—and I commend this to my right hon. Friend: Probably the present Government is the last which will have railway support in its obstruction of a bold road policy. The roads are overcrowded; they are not adapted to motor traffic; they are getting less and less adapted to motor traffic; there are thousands of bridges which are quite unsuited to motor traffic; there are alarming accidents, which are growing every year; and there is the appalling loss of time of business people in deliveries, because of the fact that the road accommodation is not adequate.

The Government, I see, are bringing in a Housing Bill. I am very glad, and I am very glad that the Minister of Health has it in charge, because there is no one in this House who has made a better impression by his Parliamentary efficiency than the Minister of Health. I know nothing about his Bill, but may I just say this? You will never solve the slum problem or the housing problem until you get better access to the country from the towns. I heard a Debate, introduced by my right hon. Friend the Member for Sevenoaks (Sir H. Young), the other day, on rural amenities, and there were two or three hon. Members opposite who opposed the Bill on the ground that it did not go far enough. They put the case that what you really want for the health of the community, especially children, is to take them out of these great crowded towns and plant them in little suburbs outside. I thought it was quite sound. Roads are the first essential to a solution of that problem, and of agriculture, and you will never solve it until you get better roads. The agricultural problem is a marketing problem very largely. [Interruption.] Anybody knows that who knows anything about the difficulty of getting his stuff to the market. It costs too much, and you have got to organise it.

This is the last point which I want to put to the right hon. Gentleman. The right hon. Gentleman ought, in my judgment, to have taken far more drastic powers to deal with the emergency. I have seen in our country the delays which are attributable to the lack of these powers—all sorts of people stopping business. The railway companies say, "We will not consent to your doing that until we know what you are going to do five miles away." One has nothing to do with the other, but the right hon. Gentleman has not at the present moment the power to put a thing through. There are delays in Whitehall; a clerk in the Treasury, for instance, can cause delay. I will give an illustration of the sort of thing that is going on. The right hon. Gentleman sanctions a scheme or the Minister of Transport sanctions a scheme. The scheme is agreed between the Ministry's engineers and the engineer of the county, but a clerk at the Treasury suddenly says, "This road is too wide; it ought to be 24 feet instead of 36." After weeks of delay that is overcome, but, meanwhile, the whole thing has to stop. There ought mot to be the possibility of that sort of thing, because the unemployed are out of a job the whole of the time.

The right hon. Gentleman ought also to reconsider the ratio which the local authority contributes, and the percentage of those whom he insists shall come from distressed areas. I find that almost impossible to work. The Minister of Transport knows the difficulty in the case to which I am referring. Taking the county as a whole, the percentage is low, but it was discovered that the towns which were contiguous to the place where the job was to be done had a higher percentage than many of the areas that are regarded as distressed. It is almost impossible to work. The right hon. Gentleman has taken too narrow a view altogether of what the State can do, although it is communal; I wish I could overcome the prejudice of the Socialist Government against communal enterprise. This is all public authority work. The right hon. Gentleman ought to take much more drastic powers for overcoming the little difficulties that create delays. Then where is his Betterment Bill which he proposed? That Bill was to have been introduced immediately, but it has not been done.

I have done my best to avoid anything in the nature of criticism, except where it was inevitable, and I could not avoid It. I have tried to review the situation quite fairly. Our failure year after year to deal with the problem of unemployment is leaving a bad impression abroad. I would just remind the right hon. Gentlemen of what his colleague said about the action of the Government. The Chancellor of the Duchy of Lancaster, speaking in this House, said: I do not think anyone would suggest that any measures taken by the present Government are affecting the unemployment situation materially one way or the other, either beneficially or adversely. That is a criticism by a Member of the Government which came from that Box. I am appealing to the right hon. Gentleman and to the Government to take this great tragic problem in hand boldly, and to take the necessary measures to deal with it effectively.

Mr. WHEATLEY

The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) said, in his opening remarks, that he did not want to introduce the atmosphere of the crater, and I am sure that we were all interested to see how he would impress the House in his new capacity as a fire extinguisher. Speaking for myself, I have a sneaking preference for the old fiery leader over the gentleman to whom we have listened this afternoon. He told us early in his speech that there was really no ground for panic. Indeed, he painted such a picture of all things being, if not well, at any rate comparatively well in this little island of ours—

Mr. LLOYD GEORGE

I said as far as trade was concerned.

Mr. WHEATLEY

I thought that that was the most surprising part of the right hon. Gentleman's speech, and it was the most disappointing part, because he told us that trade was good, and he produced evidence. He told us about the multipie shops and the co-operative societies and these large concerns being in a state, if not of prosperity, certainly of being a long way from bankruptcy. What struck me was that in this period of fairly good trade we have 1,500,000 unemployed, and I wondered what we might expect in the way of unemployment when we have to enter a period of depression, when the co-operative societies are not going well, and when the multiple concerns cease to pay a dividend: I wondered whether we are likely to have not 1,500,000 unemployed, but 4,000,000. Then the right hon. Gentleman expressed surprise that these shops are doing well. In many of the industrial districts the shopkeepers are literally living on the dole, and, if it were not for the Unemployment Insurance Fund, there would be wholesale bankruptcy among the small shopkeepers.

The right hon. Gentleman tried to leave the impression that the period of rationalisation was temporarily painful and was not likely to last; and that, when the operation was over, the patient would be in a much better condition than he is to-day. What reason has the right hon. Gentleman for thinking that what he considers the results of industrial rationalisation are temporary? I wish he could have satisfied my mind that these results are temporary, and that, when we have brought the industries of Britain up to the standard of efficiency of the world, then all will be well. I do not agree with the view that our industries are badly managed compared with the management of industries in other parts of the world I believe that the very efficiency of their management has hastened the problem with which we are confronted. The right hon. Gentleman reminded me of a speech which I delivered recently when dealing with this subject. He said that we have a surplus everywhere. We have a surplus in wheat, steel, rubber, tea, coffee and coal, a surplus in all the requirements of the human kind. Surely, that must have convinced the mind of the right hon. Gentleman that the problem which we are up against is not one of production at all. It is the rationalisation of consumption that we require, more than rationalisation of production.

I have frequently stated in this House that it is not creditable to our intel-ligen that we cannot solve a problem like that. We have not only a surplus of everything, but 1,500,000 of surplus labour, people who want to produce goods, and Who are skilled in the production of goods. It should be for intelligent people the easiest matter in the world to solve a problem like that. The right hon. Gentleman spoke of agriculture having a market for double the present output at its own door in, Britain. Can he tell us anything in human requirements that could not double its production to-day and cot find a market at its own door? Could we not consume the whole quantity of goods which we produce? Could we not consume a greater quantity of coal at home than we are consuming for domestic purposes? If we could find an outlet for everything that we produce, would not that, at any rate to some extent, produce an outlet for the surplus labour which the Tight hon. Gentleman deplored? Whenever he and any Member on the other side of the House, and many Members on this side, turn their attention to this problem, the first thing they seek is an improvement in our methods of production. When the right hon. Gentleman thinks of roads, he is not thinking of roads in the sense that goods in greater abundance may reach our rural population, but he is thinking of roads as an aid to the production in the rural parts of the country.

Mr. LLOYD GEORGE

And distribution too.

Mr. WHEATLEY

I listened to the right hon. Gentleman's appeal to the Prime Minister to treat the House as a council of State, for so little had been produced in the way of constructive policy. If the right hon. Gentleman's speech is to be regarded as a sample of what we might expect from the initiation of a council of State in this House, there is not much encouragement for the new policy. I expected something better. Here is his constructive programme. He began by chaffing the party above the Gangway for the slow nature of the preliminaries, the inevitable preliminaries to the policy which is ther object. He said, "Give us speed; give us something now," and the first thing he mentioned is a national survey. Here is something to deal, not with the ultimate, but with the immediate, something that will not keep us waiting two, three, four or five winters. Has the right hon. Gentleman any experience of national surveys? Does he knows that a national survey would probably take as much time as the unification of the Conservative party?

Mr. LLOYD GEORGE

That took a fortnight.

5.0 p.m.

Mr. WHEATLEY

Well, if we are to conclude from that interjection that the national results of his policy would be no greater than the national results of what has taken place in that party, I do not think it is something that justifies the introduction of the system of a Council of State. But, seriously, I did expect that we were going to get something substantial from the right hon. Gentle-man, because he as well as any Member of this House could give us a constructive policy if it were possible to improve the defreioncy in consumption by an improvement in production. The right hon. Gentleman must know that be is wrestling with the impossible when he is trying to find through the rationalisation of industry—however much our desine for that in itself may be—an outlet for the surplus goods of every kind which we see to-day.

The next item was that we were to use the national credit to a very much larger extent for the development of these roads. My colleagues here remind me that that policy has been denounced by the accepted financial authorities on the other side of the House. The late Chancellor of the Exchequer, speaking in the Debate on the Address, stated that we had only a limited pool of credit, and that if we used that credit for making roads it would withdraw it from other forms of industry and create mare unemployment than we should relieve. The late Chancellor of the Exchequer, in support of that statement, quoted words of exactly the same meaning used by the right hon. Gentleman the Member for St. Ives (Mr. Runciman), who, I understand, is the financial authority of the Liberal party. Speaking for myself, I do not accept that view, I do not agree with that theory, but both parties opposite accept that theory. [Interruption.] Well, does the late Chancellor of the Exchequer speak for the Conservative party when he addresses the House on questions of finance? [HON. MEMBEBS: "No!"] He does not! Does the right hon. Gentleman the Member for St. Ives speak for the Liberal party when he addresses the House? [HON. MEMBERS: "No!"] I think the House is entitled to know, because if he can get up in this House and advise us on questions of finance from the Liberal point of view and the Liberal party, when it suits them, can repudiate the right hon. Gentleman, that is not, I submit, treating the House fairly.

Mr. FOOT

The right hon. Member for St. Ives (Mr. Runciman), both in this House, in his constituency and in the country has supported the policy of using the national credit for the development of our harbours and our national resources.

Mr. WHEATLEY

That is quite true, because whoever holds that theory would be bound to yield to the contrary view to some extent. Otherwise, we could not have harbours, we could not have docks. To say that because he would use that credit to the limited extent of constructing a harbour that, therefore, he holds to the view in the full sense of the policy laid down this afternoon by the right hon. Gentleman the Member for Carnarvon Boroughs is not reasonable. We are entitled to know whether the ex-Chancellor, when speaking from the Con- servative benches, or the right hon. Member for St. Ives, when he makes pronouncements on finance, have the support of the parties behind them.

I wish the House to believe that I would like this problem solved, irrespective of what political party succeeds in solving it. I come from a Division where men are being turned out in hundreds every week, and I wish the right hon. Gentleman or someone would give us the evidence on which is founded the belief that the present industrial difficulty is temporary. I can see no evidence of it at all. The right hon. Gentleman told us that rationalisation had led to a 10 per cent. displacement of labour. I do not want to question his figures, but I can find no evidence for them. I am assured by people here who speak for the textile trades that the displacement in those trades has been 33 per cent.; and I am told that in the steel trade, taking the years from 1920 to 1927, there has been a displacement of labour which comes to about the same figure. I have the steel figures in my mind at the moment. During the seven years from 1920 to 1927 the output per man employed in the steel industry increased by 51 per cent. in the pig-iron department and by 68½ per cent. in the finished steel department. If we lived in intelligent circumstances, we should regard that as a national benefit.

Is it not a dreadful thing that we should fear over-production? In one part of his speech the right hon. Gentleman aroused sympathy for the slum population, but a slum population are people who are not merely living in decayed houses, but are people who are under - fed, under - clothed, under-educated, under-shod, who are short of all the requirements of life. Can we imagine anything more depressing than that in one part of his speech the right hon. Gentleman should tell us we are embarrassed with our riches in goods and in another part tell us we are embarrassed by the poverty of the people through the shortage of those goods! Is it any wonder that a large section of the British people are entirely losing faith in Parliament when people who have devoted their minds to this problem and have had special training in the art of solving public problems cannot solve the simple problem of bringing the surplus goods to the starving population?

The point I was at was the effect that rationalisation of industry was having on the displacement of labour. In the steel trade, in the textile trades, and, I have no doubt, in all trades, during the past seven or eight years, there has been a 33 per cent. improvement in production, but at the same time the actual wages, which represent the purchasing power of the consumers, have steadily decreased in inverse ratio. In the steel trade wages were £5 3s. 1d. a week in 1920, but in 1927, when the output per man had gone up by fully 33 per cent. on the average, wages had come down to an average of £3.

How can we hope to go on under an industrial system which reduces the purchasing power of its people as it increases their productive power? How can any intelligent man or woman expect that we can continue the output of goods at a greater rats than we can consume them, and how else can we consume them at a greater rate than by giving the people the power to buy those goods? I wish the country would settle down to this problem, because this is the problem which is eating the very life out of the nation. This is the problem that in its very nature will kill the nation. We cannot escape from it. I prophesied a year ago that we should have 1,600,000 unemployed now. I prophesy now that we shall have 2,000,000 unemployed during the next winter. The right hon. Gentleman talked about improving agriculture. All over the country there is an agitation against the insufficiency of the markets for the agricultural products we have now. Are not the warehouses of Canada, America, and Liverpool glutted with surplus wheat which they are waiting to dump on our markets? Have not our people held up their hands in terror at the prospect of getting goods as cheaply as they could be supplied from that source? What a situation—that we are in danger of being ruined by free food! What a menace! We have had meetings of farmers, labourers and landlords in Scotland and elsewhere wondering how they were going to get a market for their potatoes, how they are going to get from the people who take potatoes as much money as will enable them to continue the production of potatoes.

We are bringing about some wonderful amalgamations. The unity of the Liberal party and of the Conservative party will be nothing compared with the union of the agricultural labourers, the landlords and farmers for political purposes which is now taking place in every part of the country. It shows that we are in difficulties when the cherished political traditions of masses of our people are being lightly scrapped in view of the menace with which we are confronted. The menace is that if we get free food from Canada, or food at half price from Canada, it will ruin the food producers of this country. The political policy of the right hon. Gentleman's party in the 19th century went a long way to ruin agriculture in order to boost the production of pots and pans, and we cannot now afford to go any further on the way to ruin. That is the problem. Week by week we are improving our power of production, and week by week that is leading us into circumstances in which there is greater insecurity that a large number of our people will get a fair share of those goods.

There is the problem which I appealed to the Leader of the official Opposition to apply his mind to three years ago. I appealed to him not to set up committees to help to find a way out of the difficulties that beset production to-day, but to set up a committee that would apply its mind to the task of how to use the enormous output which modern knowledge and methods give us for the betterment of our people, and how to organise our political machinery so that no backward nation outside this nation would be allowed to use its backward methods to impede the path of progress of the nation of which we are citizens. Whether that appeal come from people who claim to be extreme Socialists, or from the other side, surely it is an appeal which in present circumstances is worthy of serious consideration. We cannot have any monopoly in the rationalisation of industry. We cannot introduce into any branch of production to-day a machine that will improve production without our rivals in every part of the world having an offer of that same machine to-morrow. You cannot get any further by reducing wages just as you cannot get any further by maintaining long working hours. There is no road that way.

We have been told that Britain requires to keep on its way to prosperity, but surely the proper way for the State to attempt a solution of this problem in face of the existence of so many surplus goods is to provide the people with more food and enable people to have more goods. Surely the same argument applies to clothing and to the textile trade. I know the difficulties which naturally appear when you think of this system. We shall be told how one trade ruins another, how coal gets dearer, and that manufacturers cannot sell steel in competition with their foreign competitors. Surely such arguments are all the more convincing that you are up against a great national problem, and you want a great scheme of national orgnisation to deal with it.

My criticism of the Lord Privy Seal has always been that the right hon. Gentleman has been attempting to find a solution along the lines pursued by both parties opposite. This nation has not failed to solve this problem because the parties opposite are inferior intellectually to the party on this side, but they have failed to solve it because they have applied wrong methods. We have been told to-night that in the remedy to be applied there must be nothing in the nature of Socialism, but, when that statement was made at the Labour Conference, I told the Lord Privy Seal that the people whose policy he was pursuing would before very long be denouncing him in the country as a failure. The Lord Privy Seal has failed, not through any fault of his own, but on account of the policy which he has pursued. He has adopted a policy which belongs to the Nineteenth Century and one which is not suitable to the needs of to-day.

I do not think the parties opposite have any serious desire of forcing a General Election this year. I am not going to be frightened by what the right hon. Gentleman the Member for Carnarvon Boroughs has said in order to get concessions from our Front Bench; in fact all I say in that respect is good luck to him. I think the Government should have sufficient courage to ask the House to proceed on the right lines in order to solve this problem. I am sorry that the Government have indicated no particular plan in this direction. Up to the present, the policy has been that the Lord Privy Seal waits upon somebody about constructing a new road, a new bridge, an improvement in railway sleepers, or a special order for coal from Canada; but that is not the way to face a problem like that of unemployment. This is not a problem which arises only once or twice in the history of a nation, but it is a big permanent problem.

The right hon. Gentleman the Member for Carnarvon Boroughs pointed to the desire of local authorities for making roads, and he said that they want more roads. In the city from which I come, hundreds and thousands of pounds have been spent on useless roads. Behind the house in which I live, a useless tramway track has been put down in order to provide work for the unemployed. Up to the present not a single tram has gone over that line, because it would cost £18,000 a year to maintain a service along it. The only labour that will be given by that undertaking in the future will be lifting up the rails which have been laid down, taking down the cable, and repairing the road which will be injured by the laying down of the tramway track. That is the kind of thing that has taken place in almost every district in Glasgow. I wish the Lord Privy Seal would ask those connected with local authorities what they think of these proposals for solving a great national problem by such pettifogging methods as those which I have described.

The right hon. Gentleman the Member for Carnarvon Boroughs has chaffed the Lord Privy Seal about having an obsession for railways and not being able to get away from the railway track. I wish the right hon. Gentleman would get back again to the local authorities, because I am sure he would find the information he would get from them very useful when he comes to address this House on the problem of unemployment. We are dealing with a very big problem. The policy which is being adopted can only afford temporary relief, and this problem is only temporary in the sense that it is not eternal. You have continued to deal with this problem in this way from 1920 to 1930. We have been told that the number of unemployed has never been below 1,000,000, that it is now 1,500,000, and that the number of unemployed has been as high as 2,000,000.

Therefore, we cannot accept the view that it is temporary in the ordinary sease in which that word is used, because it is really a permanent national problem.

The difficulty is due to the fact that our country is highly developed industrially. At the present time, you have very few of the demands that we had in the Nineteenth Century for materials for railways, bridges, the equipment of mills, and the erection of docks and harbours. Just at the time when that outlet closed you reached the stage when your output doubled; consequently, your outlet has been halved during the time when your output has been doubled. You are therefore embarrassed with riches, and you do not know what to do with them. You have a population containing a large percentage of unemployed at a time when there is a surplus of all kinds of goods in the country.

Therefore, it is not a problem of work at all. It is time someone changed the whole philosophy of the present system which means that if the Almighty gave us all the goods we require which are alleged to have been given in the Garden of Eden with no necessity to work we should still be bound to starve. Is that the new philosophy? I think we ought to give our people a higher standard of living and a much higher standard of education than they are getting to-day. Surely, we have in this country the most efficient and the most intellectual race that has ever appeared up to now on the face of the earth. I think that is an idea to which this country ought to apply its mind. Is not the foundation of all your wealth material goods and a superabundance of those goods, and, if that is so, why not take advantage of that to remove poverty from the path of the people? Let us remove from this House a great deal of the political humbug that exists to-day, and let us devote our brains and our time to the saving of our people from the disease that threatens them if the present system of distributing wealth is allowed to continue.

Mr. FISON

In rising to speak for the first time in this House, I am sure that I shall receive the indulgence which is always accorded to a Member on the occasion of his first addressing the House. I must confess that I was rather surprised that this Debate on unemployment should have been initiated by the Liberal party. After all, the Government owes its continued existence to the support which it receives daily in the Lobbies from hon. Members who sit on the benches on this side of the House below the Gangway, and I feel, and I believe that the country feels, that the indictment of the Government made by the Leader of the Liberal party this afternoon is really an indictment of their attitude in supporting the Government and maintaining it in office. As far as I am concerned, I shall try to point out to my constituents that the responsibility of the Government in its failure to deal with unemployment is a responsibility which must be shared by all those who support it day by day.

I want to draw attention to one or two aspects of the problem of unemployment which are not, I think, very controversial. Unemployment has had to be faced by every Government in a greater or lesser degree, and the fact that, since the coining into operation of the Unemployment Insurance Act, weekly figures have been published and additional data have been available, has had two results—it has focused public opinion upon the size of the problem, and it has also tended to focus attention upon the problem of dealing with those who are unemployed, that is to say, the problem of providing for their maintenance, rather than upon the problem of dealing with the causes which produce unemployment. The very size and consistence of the figures has naturally drawn people's attention away from what is really the important part of the subject, and has made them think more of the human side. The propaganda of the Socialist party has been directed to that object. For many years their speakers up and down the country have deliberately concentrated, or tried to concenttrate, the attention of the electors upon the problem of relieving the unemployed, rather than upon the problem of rooting out the causes of unemployment. It was easier to win votes and seats in Parliament by suggesting to the unemployed what would be done to relieve them, than to explain the rather complicated proposals—and they must necessarily be rather complicated to explain from a public platform—for dealing with the causes. I would hardly like to suggest that the reason for that was that the party opposite had in fact no cure for unemployment in which they believed. I think that, perhaps, it was because they had no cure for unemployment in which they thought they could make the electors believe, and so attention has been directed, for one reason or another, more to the problem of dealing with the people who are unemployed to-day than to the causes of their unemployment. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) this afternoon went back to that aspect, and asked the Lord Privy Seal to direct his attenteion more to the present problem than to the permanent part of the problem.

As far as I can see, the Government appear to have no constructive proposal for dealing with this problem. With the support of the Liberal party, they have made one contribution—they have increased expenditure upon pensions and upon Unemployment Insurance. The Liberal party cannot get over their responsibility in respect of that, for not only did they support the Government in the Division Lobby, but from time to time, when they thought, perhaps, that some electoral advantage might be gained from doing so, they made proposals and brought forward Amendments which would have increased the expenditure under the Bills which have been passed. I think that that policy of increasing expenditure upon the relief of unemployment, and especially the policy of using the Unemployment Insurance Scheme as a means of doing it, is a retrograde policy, and one which is damaging, and will eventually destroy, the whole object for which Unemployment Insurance was instituted.

I have never understood, and cannot understand to-day, why men engaged in industry who have regular employment, who seldom draw any benefit from unemployment insurance, should willingly and without complaining go on contributing week by week their quota to the scheme—a scheme which benefits chiefly, and indeed almost entirely, their less fortunate comrades who draw from the scheme far more than they pay into it. I say that I do not understand this, and I think that it is because they do not understand exactly what they are doing. They are still under the impression that this is an insurance scheme.

They pay into it because they feel that some insurance scheme is necessary, and nobody disputes that. The Minister of Labour put the point very openly and fairly the other day when she was discussing the question of bringing agriculture into Unemployment Insurance. She said then that she wished for good lives as well as bad lives, for good industries as well as bad industries, and that she hoped to get from the agricultural industry a full contribution to keep the Unemployment Insurance Fund solvent for the benefit of the more unfortunate industries. A number of industries, which may have, perhaps, a low percentage of unemployment, are being asked to contribute for the benefit of those which have a large percentage of unemployment, and the result may be that unemployment will be increased in industries which, while they have a low percentage of unemployment, are, nevertheless, like agriculture, on the verge of bankruptcy.

The Unemployment Insurance Scheme has been used by successive Governments, and may be used by other Governments unless we are very careful, to cover up and hide certain aspects of unemployment which people are rather afraid to face. In all districts, and especially in the depressed districts, the great majority of the men unemployed are men who are willing and anxious to work, men who are physically fit and are skilled. But in every district there is a residue, and a fairly considerable residue, of what I may call unemployable men, who, through no fault of their own—because they are of poor physique, because they have had indifferent health, and because they are unskilled and, therefore, for unskilled work, require to be of good physique and in good health—are to all intents and purposes unemployable. There is also a certain number of men who are unwilling to work regularly. People are often afraid to face up to that fact, but there is no doubt about it at all, and the people who know it best are these men's fellow workmen. There is a certain number of men who prefer to exist on what they can draw in unemployment benefit, rather than work for a wage which, perhaps, after all, gives them only a slightly better condition of life. I am in favour, and I think everyone is in favour, of insurance against unemployment. I think that industry should support those engaged in it. But these men, who are in fact practically unemployable, can hardly be allotted to any particular industry, and yet the Unemployment Insurance Scheme is used to support them, and they are, in fact, an incubus upon those who are producers.

One constructive proposal that might be made to help to relieve of this incubus those who are producing would be to take out of the scheme these men who are unemployable, and devise a new scheme to carry them. It could be done in exactly the same way and for exactly the same reasons as the last Government took the rates off productive industry, and made them a national charge upon the whole of the people. I am sure that people under-estimate the number of men who are living on this insurance scheme, who are, in fact, being paid for by those who are working, are adding to the cost of production in this country, and, in turn, are increasing unemployment in other industries. It is with those who are unemployable that the Government have to deal, and, as far as I can see, up to the present, they have no constructive scheme for that purpose.

When the Leader of the Liberal party mentioned the question of agriculture, I thought he was going to propose that the Government should bring out a strong agricultural policy, but I do not think that he had in mind what I have in mind. I am told that there are about 700,000 men employed regularly in agriculture, and some people say that, with a really strong agricultural policy, that number could be doubled. I do not necessarily accept those figures, but I am sure that, with a strong agricultural policy, between 200,000 and 300,000 more people could be employed in agriculture. I do not suggest that that is to be done except by giving direct assistance to agriculture. The Beet Sugar Subsidy gave direct assistance to sugar beet growing, and it has provided a very large amount of employment in that industry. I believe that it would be a good stroke of business for the State to spend more money on developing agriculture in this country, and so to bring about the employment of more men on the land. The putting back of from 250,000 to 300,000 men into employment would save the State, would save the taxpayer, in unemployment relief, something like £12,000,000 to £15,000,000, taking the cost of such relief as £50 per man per year, and far less money than that, applied to agriculture, would have the effect of enormously increasing employment on the land.

It is not only a question of material benefit. There is a benefit far greater than the material benefit. To stop the flow of men to the towns, to lessen the burden of the slum problem, to take men back to the country and to the fresh air, would, in the long run, be a benefit of far greater importance to the nation than the material benefit of dealing with the problem of unemployment to-day. Unless we can improve the health of the nation, we shall always have a body of unemployable people hanging round the neck of industry, and having to be supported by industry. I suppose that what struck many of we most of all during the War was the observation of those splendid bodies of men who came to England from our Dominions and Colonies. Nobody who saw them could have failed to be struck by their splendid physique and appearance, and, although climate might have had something to do with it, I think there is no doubt that it was in their open-air life on the farm that was to be found the cause of their fine physique. Not one of them was unemployable. I believe that, by concentrating upon agriculture and trying to increase the number employed in agriculture, as it could be increased for quite a reasonable expenditure, by thus taking men back to the country, we shall be doing something, not only to deal with the problem of unemployment to-day, but to deal with the problem of unemployment in the future, by making it possible to raise a race of men and women who will not be unemployable.

Sir ROBERT ASKE

I desire to offer very sincere congratulations to the hon. Member who has just spoken, and to express the hope that we shall have the pleasure of hearing him on many future occasions. I am sure he will regard this afternoon as one of the red-letter days of his life. I desire to follow the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) in the line he adopted, which is the development of the Liberal policy with regard to unemployment. I also desire to adopt his attitude, which was one entirely free from any carping criticism but was intended to be more in the nature of a stimulant. We on these benches, particularly those who represent industrial constituencies, are very anxious that the Lord Privy Seal should succeed in the efforts he is making. Our fear is that he is Likely to fail, but the problems are too great for us to allow any party considerations to interfere in the matter. The great problems of unemployment have to be regarded from two angles. The first is the provision of immediate work as an emergency measure for a situation of emergency, and the second is for the more distant future in preparing the way in our industrial economy. As I understand it, the former is the more immediate. The Lord Privy Seal has shown, in the work he has done up to the present, great affection for the railways, which was perhaps somewhat natural. The railway and dock undertakings are to some extent competitive with the railways. It is of the utmost importance that our harbours and dooks should be brought up to the highest pitch of efficiency, not merely because by that means we reduce the cost of handling our commodities, and thereby reduce the cost to the manufacturers and to the consumers, but also because it enables this country to compete more advantageously with Continental ports.

On this question of harbours and docks the right hon. Gentleman has had one great advantage over any former Minister. During the last few months the Port Facilities Committee has held an exhaustive survey of 60 of the principal ports of the country, which has been conducted from the standpoint of representing to the right hon. Gentleman work that is needed in order to bring the ports up to date, and it has been found that in the majority of them various work is required in order to bring them up to the pitch of efficiency that they ought to have. For all these ports, up to the present only seven schemes have been approved. Ten other schemes are before the Minister and are awaiting approval. But, notwithstanding an the other ports which mean to be brought up to date, no schemes have yet been submitted. Here is a field which would be productive of a considerable amount of employment, and which deserves the right hon. Gentleman's immediate activities. I would, in particular, ask his attention to two practical points. First of all, a large number of these ports are quite small and their revenues are correspondingly small, and, important as they are to the coasting trade, they are not able to provide means with which to bring the ports absolutely up to date. The scale that has been adopted with regard to schemes which have been approved has not been to the maximum. In every case the maximum scale should be applied, and the right hon. Gentleman should give special consideration to all the smaller ports with a view to greater financial relief. These smaller ports are in the main used by the coasting trade, which provides a cheap means of transport for heavier traffic from one part of the country to another, and it is most essential, as a matter of fairness to the coasting trade, that there should not be the great advantages which have already been given to the railways, unless some corresponding advantages are given to the struggling coasting trade, which did so much for the country in the War and on which so much of the prosperity of the country depends.

The next feature to which I wish to draw attention—and it applies to ports that are quite small—is this: The right hon. Gentleman is being blanketed by the Treasury. It is provided in Part I of the Act that financial assistance is to be given in the case of capital expenditure in development, reorganisation and re-equipment. The question of re-equipment is of far greater importance than either development or reorganisation, but the Treasury has taken the view that no matters of replacement or renewals of equipment are to be regarded as capital expenditure, and so they are left out of the benefit of these provisions. Matters like belt conveyors, up-to-date electric cranes, elevators, the electrification of a dock power system, are all maaters which are of the life of the ports. They are absolutely vital. No business man would call any of these matters anything but capital expenditure on re-feqpipment. The Treasury is standing in the right hon. Gentleman's way in preventing development. A very great part of the report of the Ports Facilities Committee is on the matter of renewals and replacements, and the work of that Committee will be to a large extent neutralised unless the right hon. Gentleman can come to the assistance of these ports and see, what I am sure is the intention, that renewals and replacements are re-equipment of a capital nature within the meaning of the Act. I leave that to the right hon. Gentleman's sympathetic consideration.

The next point I wish to mention is this: The right hon. Gentleman might be more active in seeing that the use of home manufactures is encouraged, particularly by the public and quasi-public Departments of the country. Perhaps I should make it plain by a simple illustration. The other day a question arose as to automatic road traffic signals, and the Minister of Transport said there were difficulties in the way of adequate production by English manufacturers, and he thought it would be necessary to experiment with imported articles. That is a direct discouragement to work at home. Newcastle can produce and supply as many automatic road signals, made to the requirements of the Ministry of Transport at competitive prices, as the Minister and all the bodies under his direction can pay for. The signal in question has been exhibited at the North-East Coast Exhibition all the summer, and at the British Industries Fair. The right hon. Gentleman ought to see that, in matters of this kind, where British manufactures can be supplied they ought to be supplied and the experiment made with them, instead of giving a direct encouragement to our foreign competitors. I consider that that is good Free Trade doctrine.

My third point is that it is possible to take the figures of the various sections of unemployment and to consider under each head in what way numbers of these men can be employed. That is a practical way in which the problem ought to be approached. I propose to take, as an illustration of that, one that I have pressed upon the right hon. Gentleman previously, because it is one of the largest sections of the unemployed community—I moan the building trade. The figures show that no fewer than 153,000 building operatives are on the unemployment register, and if to that number is added those who are engaged in public construction, that gives another 44,000. Altogether there are in this trade 197,000 men unemployed. That is about 13 per 6.0 p.m.

cent. of the whole problem with which the right hon. Gentleman is faced. There are more men unemployed in this one trade than in any other, with the one exception of the textile trade. Here is one of the largest sections of the unemployed community. The work that can be given to them complies with all the right hon. Gentleman's own requirements, being work of an economic character. One has to consider whether there is not available, ready to the right hon. Gentleman's hand, work on which these men can be usefully and profitably employed. You can find the way the men can be employed by looking at any industrial area in this country. You will find there a great shortage of houses, and that the people in those areas are asking for work to be done which only these unemployed builders can do. I will take a recent illustration. In the St. Lawrence Ward, Newcastle, a survey was recently held, and it was found that 58 per cent. of the people were living in an overcrowded condition, many of them six, eight and 10 in a single room. In one building consisting of 10 rooms there were nine families, with a total of 58 people. In the whole of Tyneside 34 per cent. of the people are living under overcrowded conditions, and four of the largest and most important of those areas are represented by present Ministers of the Crown. In this one city there are at least 1,000 unemployed builders. I suggest to the right hon. Gentleman—and I am quite sure that in this I shall have the support of those who sit on the back benches opposite—that this is one of the most crucial social problems of the present day, and that it is, in the whole unemployment question, the part which is easiest of solution.

The position is quite unique. On the one hand, you have this vast army of unemployed, and, on the other hand, you have the need for the work to which the men can be put. There is no excuse for this work not being put in hand, because this very work of building houses occupies a prominent position in the pages of "Labour and the Nation." Does the Lord Privy Seal propose to put these men into work building houses, and, if so, when? If the answer is "Yes," why is not the work well under way at the present time? Because there is more need for this work to be done than for any of the work to which the right hon. Gentleman has given his attention. I wish to make these further suggestions. It is no use looking to any problem of slum clearance as affecting this question. Slum clearance, unless it is accompanied by the building of houses, merely causes more overcrowding than ever. Slum clearance is merely the taking of people out of one locality and putting them into another. That does not reduce overcrowding at all. What is wanted in this country is the provision over the next two years of at least 500,000 houses. This question cannot be solved by allowing matters to drift along in a spasmodic way as is the case at the present time. An estimate has to be made—and that can be done without much trouble, because all the data is available—as to the number of houses which are required in each locality, having regard to any possible transference of labour. Having found the number of houses which are required the question then is to put on to the building of those houses the men who are unemployed at the present time. I ask the right hon. Gentleman to say where the difficulty is in getting that done. It needs, no doubt, some drive; it needs great organisation. It means that, having got this data together, there should be a scheme for the mass production of houses. The way in which houses can be built cheaply is by adopting a method of mass production.

I am told by gentlemen who are at present engaged in building houses by mass production that there is no reason at all why houses, provided there is a scheme of more than 300 houses, cannot be built at the present time to let at rents of about 7s. 6d. a week, and above that to provide both 5 per cent. interest and a sinking fund which will wipe off the capital amount within 40 years. That is actually being done at the present time by one of the right hon. Gentlemen who sits on these benches. That is the need. The need is not for any of those ideal building estates. That has been the folly of the past. This is an emergency matter. It has to be dealt with from the point of view of an emergency measure, and, if necessary, it may be that the existing building regulations may have to be relaxed. The thing is to get these people who are at present living under these conditions into decent habitation. I wish to urge upon the right hon. Gentleman, in further support of the arguments which I have advanced, that at the present time about £7,000,000 or £8,000,000 is being paid every year in unemployment benefit to these building operatives. That would go a long way towards the provision of a large number of houses. There is this further suggestion. Although the immediate problem would be the employment of those 150,000 builders it has to be borne in mind that for every two men who are pus to work on the actual building of a house another man is put to work in connection with the production of the materials and the transport necessary to provide the builders with the materials with which to work. I hope that the light hon. Gentleman will really put forward his best efforts upon this question. There is no question within our social system which is more worthy of his best efforts, and if he succeeds great honour will be his. If he fails, one will have to take the view that a great deal of responsibility for the continued unemployment of these men and for the continued existence of their women and Children under the distressing conditions in which they live at the present time must, to a large extent, be shouldered by him.

Sir ARTHUR STEEL-MAITLAND

I hope that the Lord Privy Seal has received comfort and guidance from this afternoon's Debate. When I read a speech which he delivered about 10 days ago I marked this passage in it. Having said that he had had thousands of suggestions and heaps of criticisms and abuse, he went on: I am still waiting for these people to come down from the sky to the earth and say: 'This is what ought to be done. Do it now'". I wonder whether this afternoon he thinks that from the multitude of counsels from those benches he has received wisdom. First of all, we had the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) counselling him to double the production, I think it was, of agriculture. There is no one on these benches who is connected with agriculture who would not be delighted to see that done, but if the right hon. Gentleman the Member for Carnarvon Boroughs had gone on to explain by what method he would enable the farmer in Eastern England or in Scotland who had to pay something like 40s. per ton in growing potatoes to double his production when he can only get 22s. a ton as the price for them, then indeed he would be giving a boon to this country which would be far better than any of the rest of the great schemes which he has adumbrated.

The right hon. Gentleman the Member for Shettleston (Mr. Wheatley) followed, and criticized the remedy suggested by the right hon. Gentleman the Member for Carnarvon Boroughs both as regards agriculture and as regards roads. The positive suggestion by the right hon. Gentleman the Member for Shettleston was that if you only redistribute wealth, then all will be well. It may be good on other grounds—we are not disputing that to-day—to redistribute wealth, but if by taxation he takes £l from the pocket of the Lord Privy Seal, and gives it to somebody else, would that in itself give more employment? How the second person in spending it is going to create a lot of employment, when the first person on whom the Lord Privy Seal would have spent it loses his, remains to be proved. At the same time there is a real seriousness about the Debate this afternoon which has been conspicuously absent during those long dreary Debates on unemployment when I had the task of responding as the Lord Privy Seal has to do to-day.

The figures are a great deal more serious than ever the right hon. Gentleman the Member for Carnarvon Boroughs has shown them to be. When the party opposite came into office, unemployment was 60,000 better than 12 months previously. That 60,000 has been wiped out, and the figure on the picked month of the Lord Privy Seal is 147,000 worse. In other words, there has been a falling back of between 200,000 and 210,000. That is not all. If you had a great catastrophe in one industry, that would be serious enough. The country could understand that if there was a mass of unemployment in one industry and that when circumstances changed it might get better, it did not necessarily mean that there was a great deal of hardship, or that there was much of which to be apprehensive as regards the country as a whole. But during this period employment in the mining world has also improved very greatly. There are between 60,000 and 65,000 fewer unemployed in the mining industry than when the present Government came into office. In other words, the falling off throughout the whole of the rest of the country has not been 207,000. It has been nearly 270,000, that is as regards the country as a whole outside the mining industry. That is the deterioration which has taken place judged by the comparison of the previous year, and yet, at this time last year, there was still continuing that very hard weather which, in itself, was an abnormal cause of unemployment. That makes the question serious enough.

We have had a discussion this afternoon of one of the measures which the Lord Privy Seal has taken in order to deal with it—rationalisation. In this respect I admit my entire concurrence with the policy of the Lord Privy Seal. It is all very well to argue that men will be put out of work, and that may be true, but the number of men who have been put out of work by the rationalisation effected by the Lord Privy Seal is comparatively small. In all those industries to which the right hon. Member for Shettleston (Mr. Wheatley) referred, the amount of unemployment owing to rationalisation has not been very great. He gave a figure of 33 per cent. I have not had an opportunity of looking up that matter since he spoke, but, if, as I think, it proves to be a grossly over-estimated figure, the effect of rationalization, whether it be in the woollen trade, the cotton trade, the iron trade, or the engineering trade, is much less than 33 per cent. What we have to reckon with is the fact that the great mass of unemployment in this country up to recently has been due, as the Lord Privy Seal has been made well aware since he came to his present office, to the shrinkage in the volume of our foreign trade. The result is that it is not a question of whether we want to rationalise or not, but that we must rationalise when we are competing with foreign countries in our overseas markets, if we want to keep what trade is left, much more, if we want to regain a little of what has been lost.

The point before us this afternoon is not only the unemployment that is due to the falling off in our foreign trade. That is serious enough, but the fact is that, little by little, this country, in its internal production and its internal consumption, has been taking up a good deal of the unemployment caused by the loss of foreign trade. The growth of new industries, the growth of the motor trade, the growth of the artificial silk trade, and the spread of minor new industries, have mitigated to a considerable extent the unemployment that has been caused. What is hitting this country so hard to-day is another cause in addition to anything that may be due to the loss of our foreign trade. I have no wish to make a party score on this point, but it is a fact that 75 per cent. of the depression in the present situation is due to the lack of security that at present exists in the business world. The hon. Member for Plaistow (Mr. Thorne), at Question Time a day or two ago, shouted out that employers were turning men off and making them unemployed. As if an employer would turn men off just for the pleasure of creating unemployment! No person would be fool enough to cut off his nose to spite his face. Wherever one goes throughout the country, one finds precisely the same situation in the business world. Business men do not know where they are. They do not know what the future holds in store for them, and the result is that they are not going to enter upon fresh business commitments until they have some confidence and some security with regard to what may be in store for them if they launch out upon fresh business.

I talked to one particular class of professional men who have good reason to know what is taking place, and that is the architects. In one place, I found that in regard to one big factory the plans had been put into cold storage until they know the future. In another case there were five new plans for extensions which are not to be proceeded with again until they are more certain of the future. As regards rationalisation, then, I agree with the Lord Privy Seal. But the great bulk of the excess of unemployment that is now being created is really due to no other cause than the general apprehension and the depression in the whole of the business world at this moment. Is there any wonder? In the first place, we have the whole burden of taxation looming in the next Budget; we have more millions foreshadowed for the year to come; we have statements by a responsible Member of the Cabinet, the Secretary of State for War, as to what he would do in wiping millions off the National Debt. We have a treatment of the unemployment situation whereby people who read the Parliamentary reports and keep pace with what is happening realise that, by a stroke of the pen, the Government will have substituted one clause for another in a way that is tantamount to adding £50,000,000 to £60,000,000 to the National Debt. How can you ask a manufacturer to launch out when he does not know what the price of his coal is going to be. Coal is an important factor in any manufacturing production and it is a vital factor in some.

Lastly—I do not want to stress this too much to-day—we have the statement from the Chancellor of the Exchequer that, whatever may be his other reasons, the delay in letting the safeguarded industries know what is in store for them, has had practically no effect upon the situation. When we consider the cumulative effect of all these causes, there is not a single man of business who wants to start out to make any progressive step forward until he knows what the future is going to bring forward. It is no good the Lord Privy Seal or other Members of the Government talking about the American situation. Of course, the American situation last November affected affairs, but the recovery in America has been far more rapid than the recovery in this country. That can be traced in many ways. I trace it from the stocks and shares. At the present time there is no doubt much unemployment in that country, but the recovery in the price of American stocks and shares is more marked than the recovery of the price here.

Again, it is all very well to complain of the high price for credit, but the price of credit has been reduced to 4 per cent. While the increase in the Bank Rate may, if it is put high enough, create a set-back in time of prosperity the lowering of the Bank Rate will not of itself, without any other effect, help matters when you have a state of acute depression. You may get credit as cheap as you like, but no manufacturer will set about the manufacture of goods, however cheap money may be, unless he knows that there is a good chance of selling them, and no merchant will buy them unless he knows that there is a prospect of sale in the future. That is the cause of the situation at the present time. Let me contrast it with what we were led to expect. We were told, a year ago, that: The Labour party gives an unqualified pledge to deal immediately and practically with the question of unemployment. Its record on unemployment is a guarantee that this pledge will be kept. The Chancellor of the Exchequer, in referring to the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) said: The unquestionable fact is, that whatever programme the Liberals may adopt they have not the remotest chance of ever being in a position to carry it out. Then he went on to say: We are the party that has never undertaken a mission and did not carry it through.

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden)

indicated dissent.

Sir A. STEEL-MAITLAND

If not, I withdraw it, and return to "Labour and the Nation": Its record on unemployment is a guarantee that its pledge will be kept. The most important attack upon unemployment is to restore prosperity to the depressed industries and to develop our country. This programme will not only provide employment for large numbers of those who are now out of work, but its reaction on other industries would be immediate and beneficial. A Labour Government will set to work at once by using export credits and trade facility guarantees to stimulate the depressed export trades of iron and steel, engineering and textile manufactures. Shipbuilding and shipping will immediately be benefited and by the increase of foreign trade, the improvement in these industries will be a great addition to the purchasing power in the home market. It is interesting to contrast those statements with what has been done. Take the suggested increase in foreign trade. I will take the first five months of last year in the export of manufactures. There was an increase of over £7,000,000 for the first five months of the year before, up to the end of May. That had been turned into deficit of £5,000,000 by December, and in January of the present year there was a decrease in the export of manufactures of £9,000,000 as compared with January of last year. That is the way in which they fulfil the promise of an increase in our foreign trade. Take the export of raw materials. The export of raw materials in January of articles mainly unmanufactured showed an increase of £250,000. If it had not been for an increase of £1,250,000 in the export of coal there would have been a decrease in those figures, I suppose the Government chose coal, because it shows the one advance, as a subject on which to experiment, in order to help it to join the other depressed industries.

We were told that "Shipbuilding will immediately be benefited." I turn to the latest figures published by the Ministry of Labour about shipbuilding. The "Ministry of Labour Gazette" for February shows there are 5,700 more unemployed in the shipbuilding industry than there were the same perod in the year before. The Government we were told were going to stimulate the depressed export trades of iron and steel, engineering and textile manufactures. I turn to iron and steel. After the stimulus has been applied, there are 5,300 more unemployed than there were in the year before. Engineering has responded to the stimulus by having 12,000 more unemployed than in 1928 and 3,000 more than a year ago. Take the textile manufactures. In the cotton trade there are 55,000 more unemployed than in 1928 and 47,000 more than a year ago; in the woollen and worsted trade there are 13,000 more unemployed than a year ago. If I take the percentages of increase in unemployment compared with a year ago, I find that the increased unemployment in the cotton trade is 8.7, woollen and worsted trade 5.4 per cent., artificial silk trade 5½ per cent., jute 7.2 per cent., hemp 1.9 per cent., hosiery 1 per cent., other textile industries, 2.1 per cent., carpets 2.3 per cent., bleaching, dyeing and printing nearly 5½ per cent. All these are increases in unemployment compared with a year ago. Compare those results with the promises of the Government.

I have already stated that much of the depression that exists at the present time in the business world is due to the uncertainty as to what the future has in store. We have been asked more than once to treat this question in a nonparty fashion. In quoting the Government's pledges this afternoon perhaps I have treated the matter in a party manner. I have quoted the pledges on the score of which hon. Members opposite obtained their votes in the country. That is what they will have to face in the country unless they can persuade us to treat it in a non-party fashion. In that case the Lord Privy Seal himself will have to change his tactics. I wish it could fee treated in a non-party fashion, but he first and foremost of his colleagues is the person who prevents it being so treated. He makes an appeal for a nonparty treatment and within the next few minutes will make a flagrantly partisan speech. He has done it in this House and outside. Like a chameleon he can change from red to pink; pink to a neutral tint and back again.

He is also quite incurably inaccurate in his statements. I do not profess to say that he is deliberately inaccurate, but it is surprising that his inaccuracies whenever he commits them, and that is frequently, are always on his own side. A year ago he grossly over-stated the amount of unemployment that existed; and a week ago he under-stated it by over 100,000. We want to know what the Government are really doing. In answer to a question of mine, the Lord Privy Seal said that he had stated his policy fully, and that I was not in the House when he made his earlier speeches. I have read them, and, with the exception of rationalisation to help our foreign trade, he has never made a speech in which he has given us any real policy. He will have to come down to earth. He promised information in White Papers in regard to relief works, but it has never materialised. We have asked him for his policy over and over again. I do not believe in relief works and public works. Hon. Members below the Gangway do. We want to know why he believes in them himself. Unless we can get from him something quite specific this afternoon we shall have to go to the country, as I trust we shall soon, and ask those who in the iron and steel trade, in the engineering and textile trades, in the shipbuilding and shipping trades, and all the other trades which were to get the blessings of the present Government, whether they accept the present situation. And I do not care how soon we go to the country.

The LORD PRIVY SEAL (Mr. J. H. Thomas)

The right hon. Gentleman who has just spoken opened his speech by contrasting the Debate up to that moment with his previous experience. I thought a note of regret was expressed that we were discussing unemployment in what he called a non-party atmosphere, but if any evidence was needed that he did regret it he made it abundantly clear before he finished his speech. He accused me of being persistently inaccurate; not deliberately. That is to say, he thinks I am suffering from a disease of which he is the victim, but at all events I want to submit to the House that from my opening statement on unemployment I have never once attempted to minimise the gravity of the problem or to hide the facts even when they were against me. There are three questions, and three questions only, that I am called upon to answer. I admit quite frankly that the figures are bad. No one can do other than admit that. I do not propose to make any comparison merely of a seasonal kind; I admit frankly and fully that anyone speaking from my position can do no other than admit that the figures are not only disappointing but worse than anyone had a right to expect seven or eight months ago. Therefore, the three questions I have to answer are these: Are the causes beyond the control of the Government, are the Government responsible; is the Government taking all possible steps to deal with the position; and what are the prospects for the future?

If we put ourselves in the position of a Council of State, forgetting for the moment whatever party capital has been made either on this side or the other side of the House, it will be agreed that the problem of unemployment will always remain something which carries with it too much of human tragedy to be always considered from a party point of view. I repeat, that the answer I am called upon to give to-day is an answer to those three questions. I am going to submit that the Government is in no way responsible for the present abnormal situation. There is a world reaction in trade; and those who want to take comfort either from the protectionist or free trade argument can make their deductions from either of the countries I am going to quote because some are protectionist and others free trade. Germany at this moment, with all her protection, has 3,258,000 unemployed. That is the latest figure we have. Italy has 408,000 unemployed and 21,349 partially unemployed. America gives us two extreme figures. In the Senate last week one Senator made the statement that in his view 6,000,000 was the correct figure of unemployed. Another put it at a minimum of 3,000,000, and the President of the American Federation of Labour put it at 22 per cent. of their membership. Anyone with a knowledge of America and of the way in which our unemployed statistics are calculated would be justified in saying that based upon the same data as our own figures the number of unemployed in America would be much nearer 6,000,000 than anything else. Curiously enough you get two extreme remedies.

Lieut.-Colonel FREMANTLE

Can the right hon. Gentleman give us the percentages, as he has in America?

Mr. THOMAS

I have given the only percentage quoted by the President of the American Federation of Labour. Similar statistics to those given in this country are not prepared by the Government in America. Extreme remedies have been suggested. In the view of the Secretary of State for Labour, Mr. J. W. Davis, all would be well if the Senate would give them more protection at once. The President of the Federation of Labour says that an immediate solution would be found if prohibition was abolished. That shows the extremes to which folks will go in their remedies. It is almost as difficult as the three solutions which have been suggested this afternoon. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) said, "Roads," and the right hon. Gentleman the Member for Tamworth (Sir A. Steel-Maitland) says, "No, do not spend the money in that way." My hon. Friend behind me says, "Neither of you have a solution. The real solution is Socialism in our time." At all events, I put it to the House that it is idle to discuss this abnormal situation without regard to the world position.

I do not agree in the least with the right hon. Gentleman's suggestion that the cause of this abnormal situation is a lack of confidence in this Government; the obstinacy, as he called it, of the Chancellor of the Exchequer. I will deal with that later. The right hon. Gentleman knows, no one better, that the real cause is a slump in raw material. He knows perfectly well that cotton, steel and silver all make a marked contribution to the abnormal situation. Everyone knows perfectly well that trade is not done in a falling market. For the last few months it has been falling, falling, falling, with the result that no manufacturer will take the responsibility of giving orders. If any proof is necessary as to the abnormal state of the situation, it is to be found in the fact that during the last 12 months there has been an increase of 146,000 in the number of the unemployed. Of those, no fewer than 126,000 are women and girls, chiefly in the textile and distributive trades. I ask bon. Members to put themselves for a moment in my position. I have mentioned an increase of 126,000 women and girls and an increase of 146,000 in the unemployed in the year. Who is there who would suggest that the Government could have any short remedy for that abnormal state of affairs?

What is true of cotton is equally true of wool and of silver. We talk about the great masses of the people reading these Debates. How many of the masses of the people know the repercussions of a drop in the price of silver on Lancashire trade?—Lancashire trade buying raw cotton on a gold basis, manufacturing articles on a gold basis, shipping them on a gold basis, selling them in a country on a silver standard with £30 depreciation in every £100 right away. That state of affairs existed not only to-day, but has existed during the past six months without any break. Therefore, I am entitled to ask, in what way the Government are responsible for that state of affairs? [HON. MEMBERS: "Why blame the last Government? "] I did not hold the last Government responsible. I held the last Government responsible for taking no steps to remedy the position. Incidentally, the last Government did not have that sharp drop in commodities that I have mentioned.

HON. MEMBERS

There was the General Strike.

Mr. THOMAS

The question I had to answer was, is this abnormal situation due to any action of the Government? I am trying fairly to answer that question. I answer, first, by showing the abnormal effect that the drop in raw materials has upon the position. I put it quite clearly that we as a Government are not responsible. The right hon. Gentleman minimised the effect of the recent American slump. My answer is that the repercussions of that slump are found here to-day, and we are feeling the effects to-day. The Government were not responsible. We are feeling to-day the effects of the new Australian tariff. Lancashire and the hosiery trade are feeling the effects of that tariff. The Government are not in any way responsible for that situation. I have given the House the main causes of the abnormal situation. Let me proceed at once to deal with the second question—are we as a Government taking all possible steps to meet the situation so far as it lies under our control? I submit that the effects I have dealt with so far are such as time alone can heal. No action of any Government can deal with the abnormal situation of the over-production of the raw commodities I have mentioned. Any Government which attempted to deal with it artificially would make a profound mistake and probably do more harm than good. [HON. MEMBERS: "What about coal? "] I propose to show later on the figures of each trade, including coal. My short answer regarding coal is that if I have to choose between people working under starving conditions and a demand for people to pay a bit more for decent conditions, I am prepared to encourage something that will give better wages and a higher standard of living.

At all events I proceed to deal with the second question put to me by the right hon. Member for Carnarvon Boroughs. The right hon. Gentleman said in effect, "Whilst we admit that the general situation must be dealt with by means of a long range policy, what are you doing to deal with the immediate situation and with those who may be thrown out of work as a result of your action?" I do not quite understand why so much publicity is given to the suggestion that we favour railways as distinct from roads or any other form of transport. When I introduced the Development Bill I made it clear that all public authorities were eligible. I made it clear that there was to be no distinction and, incidentally, the same Committee, a nonparty committee, is responsible alike for the sanctioning and the amount of grants to all. So that at least the Government cannot be accused of any partiality as between one interest and another. But the Government took the step of dealing with this question by refusing absolutely to admit either for Government assistsance or trade facilities anyone outside a statutory company. The reason was, and my justification to-day is, that in dealing with certain individual trades—trades which the right hon. Gentleman himself mentioned—I am satisfied that much of the trouble and unemployment in some of these industries to-day is due to the last Government's policy of giving trade facilities when it would have been much better for those concerned not to have had the facilities. Anyone examining the shipping position to-day, anyone brought face to face with it as I am brought face to face with it, is compelled to admit that the Government responsible for trade facilities is very largely responsible for the abnormal and disastrous position that some of these trades are in.

Sir A. STEEL-MAITLAND

In that case how does the right hon. Gentleman explain the fact that that occurred in 1924, when his own party was in office, and will he say how he came, at the last election, to give as one of his cures for unemployment the grant of trade facilities?

Mr. THOMAS

The answer is very simple. The trade facilities that I have given I have enumerated, but I have also made it perfectly clear why I excluded shipping, shipbuilding and the coal industry. None of the trade facilities that I have enumerated would come under that category. The trade facilities that I suggested were facilities that would not add to the dead-weight capital of the country, would not bolster up inefficiency, would not even encourage over-capitalisation, but would apply only to those undertakings in which it could be shown that the nation would be more efficient as a result.

Sir A. STEEL-MAITLAND

The right hon. Gentleman has stated that the grant of trade facilities to shipping had an ill effect, due to the Conservative Government. Will he kindly explain how it was that his Government in 1924 granted those trade facilities to shipping, though at that time they were opposed by Conservatives?

Mr. THOMAS

When I dealt with the question of shipping I dealt with it from the standpoint of all trade facilities, and any that were given by the 1924 Government would come under precisely the same category of my criticism. I am called upon to justify my policy. I am being pressed from all quarters to-day to state why I do not apply trade facilities in 101 different directions. I am giving the reason why I do not do it. I proceed now to answer the right hon. Gentleman's question—how are we as a Government distributing our work fairly as between one industry and another, and what sanctions have been given? I have here a prepared statement:

Railways, total amount of schemes sanctioned, £8,000,000.

Docks and Harbours, £6,000,000. That is an answer I think to the hon. Member for Leith (Mr. E. Brown).

Mr. ERNEST BROWN

In that list Leith is concerned. I have had a wire from Leith Docks saying: We have had no word from any Department as to the result of the application on 25th November to the Unemployment Grants Committee, and this threatens dislocation of arrangement for continuing work for unemployed men.

Mr. THOMAS

That is rather unworthy, seeing that in the negotiations regarding Leith Docks and when there were difficulties that the hon. Gentleman wanted me to get hold of, which he knows I did, he was always quite ready to come and tell me about them, and did not raise matters in the midst of a speech, when he knew perfectly well that I could not possibly answer him.

Mr. BROWN

Surely the right hon. Gentleman is unfair. He has used this money for weeks now in that statement. I have had this telegram only within an hour, and therefore I could not give the right hon. Gentleman the statement.

Mr. THOMAS

I leave the House to judge. No Minister could keep in his head such figures as those with which I am dealing. It is fairly obvious that a Minister's Department must supply him with the figures. I am quoting from the figures showing what has been sanctioned 7.0 p.m.

by the Government. I repeat railways £8,000,000, docks and harbours £6,500,000, water supply £3,000,000, electricity £10,000,000, land reclamation £1,250,000, unclassified roads £2,500,000, trunk roads £10,000,000, road improvements £14,000,000. Here is the Government's contribution of £65,000,000 sanctioned on schemes which will all ultimately tend to the efficiency of the nation. There have been complaints of delay and I ask the House to observe the situation. At half-past seven this evening a Debate will take place on a scheme, not included in these figures, costing £3,000,000, which has been waiting for weeks for this Parliamentary sanction before it can go upstairs. It is a scheme which is included in the Liberal Yellow Book. I am not complaining of the delay, but that scheme with at least 30 other schemes cannot be undertaken until this House has given the necessary sanction. The right hon. Gentleman asked why the Government did not themselves take power over matters of this kind. I would point out to him that it is impossible, and that this House will not only claim but will always exercise its right in that particular respect. That is not the only delay. I sanctioned a scheme for Hull which I considered was long overdue, and which the Hull Corporation assured me would meet with the unanimous approval of the people of Hull. After weeks and months of negotiations, when the Government grant had been sanctioned the scheme was turned down.

I submit that an expenditure of £65,000,000 in 10 months is the best answer to those who assume that the Government are doing nothing. I do not attach the importance to these schemes that the right hon. Gentleman does. From 1920 to 1927 no less than £190,000,000 was spent on roads and bridges and other relief works, yet no one can suggest that it gave any permanent contribution to the unemployed problem. I have applied myself therefore to seeing if we can provide temporary employment on the lines I have indicated pending a fuller investigation and a practical attempt to find a further remedy. In spite of those figures, I am not one who at this moment is going to despair. [Interruption.] I admit frankly that there are a number of factors, some of which I have given, contributing to the present situation, but I also admit that there is a mean attempt on the part of some people to exploit the situation. I am not referring to anyone in this House or to any party in this House, but I am referring to a responsible firm who issued a circular broadcast, which is reprinted in foreign countries, a prominent old-established city firm who can actually print a circular, broadcast it, and suggest that this country is not only down and out but that there is no hope of recovery and they advise people immediately to transfer their money from this country abroad. I say that anyone guilty of that conduct ought themselves to leave the country, because the country would be better without them. I would go further and say that the tendency always to magnify the unemployment figures as against the employment figures also does incalculable harm.

Brigadier-General Sir HENRY CROFT

Does not this firm include all the leading lights of Liberalism in the City?

HON. MEMBERS

Name!

Mr. THOMAS

It would be mean on the part of anybody to associate any particular political party with this particular firm. I have said that I do not take such a pessimistic view. I believe that there are a number of factors that tend to give encouragement. I believe that the reduction in the Bank Rate is going to be a very helpful factor. The immediate effect will not be felt, but I am certain that in a few months' time we shall get immense benefit from cheap money. When I look at the shipbuilding industry, to which the right hon. Gentleman referred, I get far more encouragement. Last year we produced 5ft per cent. of the total tonnage of the world, and, instead of the figure of unemployment being on the increase, as the right hon. Gentleman said, the figures of unemployment in that industry to date show a reduction of 8,000 on January, 1929.

Sir A. STEEL-MA1TLAND

The right hon. Gentleman accused me of inaccuracy. This is the "Ministry of Labour Gazette" for February, 1930, and on page 64 it gives the figures for the numbers insured and the percentages unemployed in shipbuilding and ship-repairing, and shows that, with a total in the trade of 204,000, there was an increase of between 2 and 3 per cent. It is a very small figure which I cannot see in this light, but there was an increase in unemployment of between 2 and 3 per cent. over 23rd January, 1928.

Mr. THOMAS

I have not seen what the right hon. Gentleman quoted, but for the purpose of this Debate I had taken out the figures of each industry, and the figures for shipbuilding for the end of January, 1929, and the end of January, 1930, show a decrease in unemployed in shipbuilding of 8,000. That must be borne out by the statement I have already made that last year constituted a record for the shipbuilding industry. That is what justifies me in saying that I was not pessimistic upon that head. When I come to marine engines, there was an increase of 20 per cent. last year; ships launched 5 per cent. for the year—

Mr. LLOYD GEORGE

Increase of employment?

Mr. THOMAS

Yes, increase of employment. The right hon. Gentleman drew attention to coal. He will be pleased to know that the output for 1929 was the highest for any year since 1924 and, as he rightly pointed out, there was also an increase in those engaged in the industry. The same figure of increase applies to the pig-iron industry, steel ingots and castings, and electrical engineering. The best figure of all is that, notwithstanding the increase, the capacity of the country generally is to be measured by the fact that there were 750,000 more people employed last year than six years ago. I presumed that the House, and especially the Opposition, were really anxious to find something that would encourage them, that they were not anxious to have merely dismal figures, and that they would be delighted with any improvement. Therefore, I am dealing at this moment exclusively with those who merely content themselves all the time with magnifying the unemployment situation.

Sir A. STEEL-MAITLAND

The right hon. Gentleman is criticising us, and I have a right to put this question to him. If he criticised us for this, why did he himself say: The meanest statement that was uttered to-day was the half-truth that there were more people employed to-day than when the Government took office?!

Mr. THOMAS

Surely, the right hon. Gentleman and the House must be aware that in this part of my speech I was dealing with the facts that would warrant my being optimistic. I pointed them out. I pointed out that, bad as was the position with regard to the drop in raw materials, immediately bottom was reached there, there must inevitably be a very sharp revival. Everyone knows that the number of those who are hanging off purchasing the goods of the country at the moment is gradually being depleted, and there will be a sharp rebound from that position. I have already indicated that cheaper money must have its effect and I conclude by making this statement. I suppose that judging from any figures such as we have discussed this afternoon condemnation may be made against the Government. What I have refused to do is merely to make a spectacular effort on the assumption that spending money will cure the evil. I do not believe that it will and I do not intend to do it. What I do know is that there are a number of industries in this country and they must be treated in different ways. Some have too much capital and it has to be wiped out. Some are in need of capital and it has to be found. [HON. MEMBERS: "Oh!"] Oh yes, there are both cases. I find, every day, many industries in that position, and hon. Members know perfectly well that steps are being taken to find the money. I find there are other industries with far too many units; some industries with no co-operative buying organisation and no real selling organisation.

All these things are being dealt with, trade by trade and industry by industry. It is the case, as the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) pointed out, that the process of rationalisation, temporarily, may have a bad effect, but I am certain that in the end the effect will be to the benefit of the nation as a whole. In the interval the Government are not standing by. The Government are doing all that they can, not favouring railways as against roads, or docks against harbours, but merely taking the broad comprehensive view of trying in the end to make the nation more efficient. I cannot answer the individual questions put to me about various harbours, because there is a deputation discussing that matter on Thursday of this week, but I assure the House that, however unpleasant to me may be the task, and it is unpleasant to have to stand by and see the figures go up week after week, it might tempt some folk to make a spectacular effort with a view to trying at least to encourage themselves by merely saying, "Money will do it." I am satisfied that it is a world cause. I am satisfied that there are factors for which this Government are not responsible, and for those for which the Government are responsible, we, at least, will bear our share of the responsibility.

Sir H. CROFT

May I rise to make a personal apology? I referred to a firm which was mentioned by the Lord Privy Seal and I said that some of the gentlemen associated with that company were members of the Liberal party.

Mr. E. BROWN

"Leading lights!"

Sir H. CROFT

Yes. I had been informed that a Mr. Ian Macpherson was a director, by somebody who imagined that it was my right hon. Friend in this House. I have since been informed that that statement is incorrect and I desire to apologise to the right hon. Gentleman.

Mr. KINGSLEY GRIFFITH

I am sure that I can speak on behalf of my hon. Friends sitting here when I say that we recognise to the full the desire of the hon. and gallant Member to apologise for an inadvertent statement. I am sure that no one desires to depress the Lord Privy Seal by unreal ground of pessimism. At the same time, it is idle for the right hon. Gentleman to cheer himself by unreal grounds of optimism, and, when he comes back to the old Tory argument that, because there is an increase in the amount of employment, that entitles him to be cheerful, let me remind him of what the present Prime Minister said on 24th July, 1928, referring to a statement of the late Chancellor of the Exchequer to the effect that employment was increasing steadily and that there were then 360,000 more people employed than had been the case four years previously. The present Prime Minister said: What has that to do with the question of unemployment? The right hon. Gentleman seems to be surprised. Why was he content with four years ago. Why did he not go to 40 years ago, and if he wished to console himself in even greater measure he might have gone to 400 years ago. If that argument was good against the late Chancellor of the Exchequer it is equally good against the Lord Privy Seal and therefore no one ought to accept that statement as a real ground of optimism. One cannot help feeling that there must dwell in those Despatch Boxes on the Table some kind of malign spirit which, as soon as the right hon. Gentleman cross over to that side of the House depresses them and deprives them of all the hopes which they formed while sitting on these benches. The right hon. Gentleman to-night has been very pessimistic about roads and bridges. His own Prime Minister speaking in the Debate to which I have just referred laid down what I imagine my right hon. Friend the Member for Carnarvon Boroughs would welcome as a perfectly sound basis: Are we making the best use of our own material; are our own national resources being developed as they ought to be developed? Having put that general question the right hon. Gentleman took individual instances and said: There is the whole question of the roads and bridges to be re-built…Nobody who has gone over our roads will be satisfied with what has happened…From John o'Groats to Land's End there are roads to be widened and surfaces to be made new."—[OFFICIAL REPORT, 24th July, 1928; cols. 1109–1112, Vol. 220.] That was what the Prime Minister thought in July, 1928, and, as for the money, there was going to be no difficulty about that because in the same Debate the finest financial authority of the party opposite said: You are not going to palliate much less solve the unemployment problem unless you are prepared to spend money. We have spent £600,000,000 in supporting the unemployed in idleness. That money should have been devoted to the development of the Empire and the resources of our own country. Everyone will be surprised to hear that that statement is from the present Chancellor of the Exchequer. I wonder whether that is the kind of thing which he at present addresses to the Lord Privy Seal in any confabulations which they may have. Does he say "Comrade"—or however he addresses the right hon. Gentleman—" what is wrong with you is that you have not large enough ideas, and you will not spend enough money." I should like to hear the Chancellor of the Exchequer talking in that style because he thought at the time to which I refer that If these plans were adopted they would cost money but the Government"— that was the Government of the hon. Members now above the Gangway—

"prefer to give it in the form of a miserable dole to keep men from work."—[OFFICIAL REPORT, 24th July, 1928; col. 1217, Vol. 220.]

Who is giving the miserable dole to keep men from work now? The situation has changed. But it was not only on that occasion or from those speakers that we heard those arguments. The right hon. Gentleman the Home Secretary has laid down what I think we should all agree is the essence of the matter, when he said that any Government in any such prolonged period of unemployment had to choose between paying for idleness and paying for work, and that the dole must be turned into a wage. That is exactly what is being suggested from these benches this afternoon, but owing to some change in the geographical distribution of hon. Members, because they are sitting on those benches instead of here, the old Tory ideas have infected them, and it is from them that we now hear the hopeless doctrine that all this is useless and only a temporary remedy. I suggest that even a temporary remedy is better than nothing. Only last November we had the Prime Minister saying that his previous Government in 1924 had left behind them enough schemes of work in the pigeonholes of the Departments to deal adequately with the temporary relief of unemployment. If it was true in November that those scheme were waiting for hon. Gentlemen above the Gangway merely to pick out of the pigeon-holes. how much easier for those who knew where to find them? They would not have wanted the Lord Privy Seal for that purpose, or the First Commissioner of Works. It would have been enough to have sent the Chancellor of the Duchy of Lancaster just to pick these schemes out of the pigeon-holes. But the fact is that there has been a complete change of view on the part of right hon. Gentlemen on the Front Bench opposite.

I think it is very lamentable, and in quoting these arguments from their own speeches I have not done so with a view to reproaching them, unless the words themselves are a reproach. I have done so because I hope to rekindle in them some of the old optimism which they were prepared to show when they were in Opposition. If those arguments were good enough when used against hon. Members above the Gangway, surely they are good enough now. At least, right hon. Gentlemen opposite cannot complain that they have been badly treated from these benches this afternoon. We have come forward with suggestions in which we are willing and anxious to co-operate. All we are anxious for is that some move should be made. Compared with the glowing prospects which were held out in those previous unemployment Debates, what has been put forward by the Lord Privy Seal this evening is only a beginning. He is only beginning to tinker with the edge of the problem: and if more courageous views are adopted, and a larger programme instituted, then we on these benches will be ready to co-operate in every possible way. But it gives us cause for melancholy reflection when we see, little by little, the old arguments for doing nothing infecting the Front Bench opposite, and—to judge from some of the cheers which I have heard this evening—spreading further and further up the back benches, until the tide threatens to overwhelm even the right hon. Gentleman the Member for Shettleston (Mr. Wheatley). I hope it will not do so. I hope we shall be able to claim the right hon. Gentleman and his friends at least as allies when we say that we are not content with what has been done and are looking forward to much greater progress in the future.

Mr. WISE

I could not help thinking when I listened to the speech of the Lord Privy Seal that he seemed to have brought together in the House to-night two separate statements. One was an admirable statement analysing the causes of the difficulties of the position, a statement as to which one can have no cause for complaint because it is perfectly true that the right hon. Gentleman is suffering from an international position which is not of his making. The other which I thought was less admirable, was that in which he got down to the practical measures which he proposes for dealing with that situation. I do not think the House can accept the view that the world difficulty of which the right hon. Gentleman complained, is some act of God with which we cannot cope. It is up to this House and to this Government to find a method of dealing with that situation, either alone or in co-operation with other countries. We are entitled to know, and we ask again, what this Government propose to do in that connection. He referred to this world over-production, as he said, of raw materials—

It being Half-past Seven of the Clock, and there being Private Business set down by direction of the CHAIRMAN OF WAYS AND MEANS under Standing Order No. 8, further Proceeding was postponed, without Question put.