HC Deb 05 May 1930 vol 238 cc666-90

Considered in Committee under Standing Order No. 71A.

[Mr. ROBERT YOUNG in the Chair.]

Motion made, and Question proposed, That it is expedient to authorise the President of the Air Council to agree, with the approval of the Treasury, to pay subsidies to any persons and to furnish facilities for their aircraft, in consideration of those persons maintaining in accordance with the agreement a regular service for the carriage by air of passengers, goods, and mails, and to authorise the payment out of moneys to be provided by Parliament of any sums required by the President for the fulfilment of any such agreement: Provided that the aggregate amount of the subsidies payable under all such agreements shall not exceed one million pounds in any financial year, and no subsidy shall be payable under any such agreement after the thirty-first day of December, nineteen hundred and forty."—[King's Recommendution signified.]—[Mr. Montague].

The UNDER-SECRETARY of STATE for AIR (Mr. Montague)

The reason for this Motion and the Bill which is to be introduced, is that, after full consideration of the constitutional position and practice, and of the precedents, it is considered to be desirable in future that the Secretary of State for Air should have statutory authority to make those long-term agreements with air transport companies entailing the payment of subsidies over a period of years, which have been found necessary all over the world in reference to civil aviation in its present state of development. A number of these agreements have been made in the past, and it is expected that a number of agreements of a similar character will be made, notably for the air service to South Africa, which it is hoped to institute before the end of the present year, and for the air service to Australia, which is now under discussion with the Government of Australia, and which, we hope, will come into operation in the not too distant future.

I would like to emphasise that the existing agreements have, as a matter of course, been throughout subject to the approval of the House. White Papers have been laid, and not only have the main provisions been presented to the House by that means, but the funds required to pay the necessary subsidies year by year have been voted annually by the House under Vote 8, which has been put forward for discussion when the Estimates have been introduced with the specific object of facilitating a discussion of the Government's civil air policy and the general question of subsidy arrangements. It has been felt, however, that on the whole, it would be advantageous, as well as in accord with the established usage, to give the Secretary of State for Air express statutory power to make arrangements of this character in view of their long-term nature, and the fact that such agreements once made must be binding upon successive Parliaments for their whole currency, and may exceed the life of a Parliament with whose approval they were originally concluded.

Though there are no precise precedents, it has long been customary when dealing with similar agreements which are to be binding on future Governments and Parliaments, to make them a subject of statutory authority, as is now contemplated. For the rest, there will be no change in the present procedure. It is intended in the future, as in the past, as and when each new agreement reaches its appropriate stage, to inform Parliament of its main features, and there will, of course, continue to be opportunities for discussion in the annual Debate on the Air Estimates. I will not trouble the Committee with an explanation of the reasons for taking the figure of £1,000,000 gross as the overriding aggregate amount for all subsidies possible under such agreements for any one financial year, because that is fully explained in the Memorandum which is in the hands of Members. I think that the reasons for that figure are clear.

Lieut. - Commander KENWORTHY

Which Memorandum is that?

Sir SAMUEL HOARE

I am sorry that you, Mr. Young, should have had to read out so long a Financial Resolution, because it seems to me that this Resolution, and the Bill which is to be founded on it are totally unnecessary. It is a work of departmental pedantry. For 12 years ago, since Exchequer grants were first made to civil aviation, and during the five years of my own experience, a certain procedure has been adopted. As many as five long-term agreements were made during my period of office. Details were given of them, White Papers were laid, and opportunities were offered to the House to discuss them, but not a soul in any party in the House ever suggested that further authority was needed by the Government. Yet to-day we are asked to take up the time of the Committee with a Measure which, owing to its financial character, will take up a lot more time in future, and will do something which is not at all needed. If statutory authority has been needed during the last 12 years, why did not someone say so? We have had a number of these agreements; I was responsible for five of them, and there has been no suggestion in any part of the House that any Bill of this kind was at all necessary.

I should have thought that the Government had quite enough upon their hands without embarking upon a new Bill of this kind and taking up time which, so far as the Opposition can judge, is urgently needed by the Government for getting through the programme which they already have upon their hands. Having said that, I should not like it to be supposed that I rise to oppose the Motion. If the Government like to waste the time of the Committee and of the House, that is their affair, and I am not going to suggest to my hon. Friends that they should oppose Amendments to it or vote against it. Assuming that a Financial Resolution and a Bill are needed, the details of this Motion seem to me to be unobjectionable. It is obvious that, if you are to make contracts with civil aviation companies, and if the subsidy is to be something more than a yearly dole, these contracts must last for a number of years. When I first went to the Air Ministry, there were in existence a number of short-term agreements running, in most cases, for only a year. The result was that the operating companies were merely living upon the amount of dole from the Air Ministry, and at the end of the year they came along and asked the Air Ministry to make up a deficiency.

With that experience behind them, and with the further experience of contracts which we have made with the Imperial Airways Company, it is quite clear that, if ever the Treasury and the Air Ministry are to get their money's worth, contracts of this kind must be made for a number of years, and should, I suggest, be made upon a descending scale, so that in the later years smaller subsidies should be paid. In this way an incentive would be given to the operating companies to make their services economic and independent of Government assistance. That has been the basis of the action of the Air Ministry for many years past. So far, then, as the question of authority to make long-term agreements is concerned, I say, without any reservation, that the only agreements that are worth anything at all are long-term agreements, and that short-term agreements, judged by past experience, leave you in the end in no better position than when you began them.

The second part of the Financial Resolution deals with the actual amount of money to be voted for the next 10 years, which is a sum averaging £1,000,000 year. That may seem to some hon. Members a large sum. Of course, £1,000,000 a year is a substantial item of national expenditure, but when we look at the expenditure of foreign countries, £1,000,000 a year is really quite a modest sum to spend on civil aviation in subsidies. Our neighbours in France are spending three times the amount that we are spending; in Germany twice that amount is being spent; and in the United States of America something like seven times that amount. Those figures show that £1,000,000 a year is not an unreasonable sum for this country to spend on civil flying. It is often thrown in our teeth that we spend so small a sum upon civil flying. It is a small sum, but when I say that I do not wish it to be thought that the efficiency of the civil flying in any country ought to be judged upon the amount of subsidy that is being voted in support of it. If civil aviation were merely a matter of spending money, it would be a very simple affair.

I suggest that the real test to apply to expenditure of this kind is not the amount of money to be spent over the next 10 years, but the test of the efficiency, the safety and the regularity of the country's civil aviation services, and, no less, the important question of whether that civil aviation is ever likely to become self-supporting and independent altogether of Government subsidy. Even if it would be in order to do so, I do not wish to go into detail on all those points on this occasion, but I will venture to tell the Committee that, judged by these tests, our civil aviation will stand comparison with that of any other country. Take, for example, the question of whether or not our civil aviation is becoming more or less dependent upon Government subsidies. Year by year our civil aviation is becoming less dependent upon subsidies. It would be possible to give figures to show that year by year the operations of the Imperial Airways Company are becoming more self-dependent, and I very much hope that during the next 10 years, the period in which this money will be spent, we shall see our aeroplane services become self-supporting altogether. The whole basis of the last two agreements we made with Imperial Airways Company was that after a term of years they would need no further Government subsidies at all. In the case of the agreement we made for the India route, I think there are still six or seven years to run, and I hope that during that time the service will become so completely self-supporting that at the end of the period it will need no such aid as is proposed in this Vote.

Mr. MONTAGUE

It has eight years to run.

Sir S. HOARE

Unless things have greatly changed in the last 12 months, I very much hope that the eight years will prove to be a sufficient period. I imagine that this Resolution covers subsidies to airships as well as aeroplanes, and I also hope that during the period in which these grants will be payable we shall see a commercial airship service operating between this country and the distant countries of the Empire and of the world. I can quite imagine that in its early years such a service will need substantial subsidies, and I certainly hope that in this 10 years we shall see at least one Empire airship service in actual operation. Let me end as I began by saying that I think the Government are wasting the time of Parliament in asking for this Resolution and this Bill, but, if they want the Resolution, then so far as I am concerned, I say, "Let them have it."

Lieut. - Commander KENWORTHY

The opening sentence and the concluding sentence of the right hon. Baronet's speech were extraordinary. Here is the temporary leader of the Opposition complaining of an opportunity given to Parliament to discuss the voting of £1,000,000 a year for the next 10 years, £10,000,000 in all! What has become of the economy campaign? Here is an opportunity for checking possible extravagance, yet the right hon. Baronet hotly complains that my hon. Friend the Under-Secretary of State for Air is giving Parliament an opportunity of examining the expenditure. I entirely disagree with the right hon. Baronet. Being a supporter of the Government, I want to help their business through, but I would like to ask for some information about the Vote. This civil aviation question is so important that on the few opportunities we have of discussing it, apart from the question of the air defence of the Empire, we have a, right to ask for information. The right hon. Baronet asked whether this money included subsidies for airships? May I reinforce that request for information? If any of the money is to go to airship development, how much is to be used for that purpose? I am very anxious that too much money shall not be spent on subsidising airships, to the detriment of the heavier-than-air services, especially when the Imperial air routes are extended to the Antipodes and South Africa. I hope the time will come when the whole £1,000,000 will be usefully expended on heavier-than-air craft carrying mails and passengers to distant parts of the Empire, and I should be alarmed if there were a chance of its being swallowed by an Air Ministry that might possibly have gone temporarily airship mad. It is a curious disease, this airship disease. People start by being sceptics, and then become tremendous enthusiasts, thinking that aeroplanes are absolutely useless and that nothing matters but airships. I am a little afraid that that disease might afflict an Air Ministry in future years, and that heavier-than-air mail transport might be starved.

My next question is whether the Air Ministry is in continual communication with the Postmaster-General, who, I am sorry to see, has been called out of the Committee. The Postmaster-General can help enormously in the very ideal the right hon. Baronet has in view, namely, that civil aviation shall one day become self-supporting. A tremendous filip can be given to it by proper payment being made for the carriage of mails. There is the question of air transport between England and Ireland and between the Isle of Man and England. Those routes could be opened with a passenger-carrying service. There is also the question of the carriage of mails to Australia and South Africa. I hope that in the matter of these services the collaboration between the Air Ministry and the Postmaster-General is of the closest; I have no reason to doubt that it is not, but I would be very glad of reassurance on that point. I must again point out, as I have in previous Sessions, that whereas we vote these large sums of money every year they are not spent. The right hon. Baronet did not spend anything like the money that we voted and that he could have spent on subsidising civil aviation. He spent only £360,000 on civil aviation subsidies in his last Estimates, including the National Flying Services and the light aeroplane clubs. He could have spent £1,000,000, but spent only £341,000 on civil aviation subsidies. My hon. Friend is spending only £428,000. That is a welcome advance, but it is not £1,000,000, and I am sorry that he is not doing more to encourage this vitally-important Imperial service.

When we are tying our hands in this way I think that we have a right to know a little more about the policy and the work of the present monopoly of Imperial Airways Company. I am not attacking the company. I have, in my humble way, paid a tribute to what I think is their very efficient service, and the devoted care and attention to their duties shown by their representatives in very unpleasant and out-of-the-way parts of the world, and I am sure the right hon. Baronet will bear me out in that. They have a splendid staff, especially in the Middle East, and they have a wonderful service which has combined commercial efficiency, as far as I can see, with the devotion to duty of a great public service. Therefore, I make no attack upon them, but we have to judge by results, and it is the woeful fact that we are still only the sixth or seventh nation in civil aviation. The comparison between this country and the leading Continental countries is very gloomy for those who had hoped to see this country leading in civil aviation, as I believe we do in design and in the art, of flying. Is it convenient for my hon. Friend to make any statement with regard to future policy in this matter? On 18th March, when the House went into Committee on the Air Estimates, my hon. Friend the Member for Northampton (Mr. Malone) raised the question of policy and of monopoly of information and the Under-Secretary then stated: That is one of the questions being considered by the consultative committee. That was a reference to the consultative committee on civil aviation set up by my Noble Friend the Air Minister— and I had better ask the hon. Member to wait until the whole question has been thoroughly gone into by the Committee."—[OFFICIAL REPORT, 18th March, 1930; col. 2000–1, Vol. 236.] That was some six weeks ago. Is my hon. Friend in a position to say anything further on that subject?

I see that the Memorandum refers only to certain European services and the weekly service to India and the hope of an extension to South Africa. On that occasion my hon. Friend the Member for Northampton drew attention to the important question of the West Indies. A civil aviation service between the West Indian islands would achieve far more than connecting those islands. It could be a great link between North and South America and of immense importance. Again my hon. Friend the Under-Secretary replied that the consultative committee was looking into the matter. I would like to press him now as to whether he can give the Committee any further information on these points—the policy with regard to the future of the monopoly at present enjoyed by Imperial Airways Company, and whether it is intended to maintain it; and the question of the extension of the Imperial air lines. In spite of the presence of an hon. Friend who sits for one of the Essex Divisions, and who always becomes hilarious when I mention it, I must refer again to the air mail route between Galway Bay and the Continent passing by way of the North of England, and across the North Sea to Hamburg. When the Air Estimates were under discussion my hon. Friend the Under-Secretary said negotiations were going on. Have those negotiations succeeded? Have we any hope this year or next year of seeing something done, or is a German company to be allowed to step in and organise this very important air service route which would bring about a saving of many hours, amounting, indeed, to days, in the transport of mails across the Atlantic to the Continent.

I hope that the Under-Secretary will not mind my pressing him for further information. I am afraid I have neglected my usual practice of giving him notice of these questions and, therefore, I shall not mind if he has not the necessary information at the moment, but I do ask for a little hope, guidance, and encouragement for the people outside this House who are trying to organise these services, and for the great municipalities who have established their own aerodromes at the request of the Air Ministry. The right hon. Member for Chelsea has insisted on the national importance of this responsibility on the part of municipalities, and I should like to know whether they are to get any encouragement.

Civil aviation in this country will not come into its own as long as it is under the Air Ministry as at present constituted. It is bound to be overshadowed by the military service. That is unavoidable I fear. Recently, when I was flying in the Middle East, I had occasion to apply to the military authorities for information about the times of the air mails, and while they were courteous and willing to help they made it perfectly clear that this branch of civil aviation, our longest air route, was no concern of theirs. They said that they did not interfere, that they had no official connection. If there was an accident and the pilot and his passengers were captured by any tribe they sent out an expedition, but that was the only kind of interest to which they would confess. As long as civil aviation and military aviation are under one roof the military is bound to overshadow the civil side. What is the remedy? The remedy is to put civil aviation under the Ministry of Transport. That would be the salvation of civil aviation. I do not make any kind of reflection on my hon. Friend, who has only been a few months in office, but we expect more important results and greater developments in civil aviation from him than the right hon. Member for Chelsea was able to achieve during his five years of office.

Sir HILTON YOUNG

I rise to ask the Under-Secretary to elucidate further this rather curious procedure. I confess that his explanation and the comments of my right hon. Friend the Member for Chelsea (Sir S. Hoare) must have left the Committee somewhat mystified as to its intentions. If I understood the explanation of the Under-Secretary, which I followed with close attention, it is this—that it is necessary for him to get statutory powers in order that the Air Ministry may have authority to make contracts involving the expenditure of public money covering a term of years. If that is the doctrine it is certainly mystifying statutory authority may be necessary, but if it is, how is it reconciled with the existing procedure in regard to other spending departments? I ask for enlightenment. What is it that differentiates the position of the Air Ministry from the position of the Board of Admiralty when they make contracts covering a term of years and involving the expenditure of public money, or from the Secretary of State for War who is always making big contracts covering a term of years involving the expenditure of public funds? Or take an analogy which is closer still, the analogy of the Post Office. What is it that distinguishes the position of the Air Ministry from that of the Postmaster-General who is making contracts of the same kind? Is it the case that all these spending departments base their powers to make such contracts on particular Statutes and if so, what are the Statutes upon which the powers are based?

There is here something more than a mere question of procedure; there is a question of some practical importance. Since the business activities of the Government are regrettably constantly extending, it is desirable that they should be able to conduct them in a businesslike way and free from red tape regulations devised for a different state of society. This leads me to the second question I desire to ask: whether the Bill which is to be based upon this Money Resolution is intended to make any difference in the manner in which specific contracts are to be presented for the consideration of the House of Commons. The manner in which they have been presented hitherto is eminently practical. A White Paper is issued stating the nature of the contract and there is an opportunity for discussion on an appropriate occasion such as the Estimate. That procedure, I imagine, has been satisfactory in practice, and should be maintained. But some doubt may arise lest it be intended to restrict the opportunities for the consideration of these important agreements. Every agreement relating to a subsidy is important from the point of view of public control. There may be an intention to alter the procedure. The Committee I think would deprecate any reduction of the opportunities on the part of the House for the consideration of these agreements, or any advantage being taken of these new powers which are now being sought to deprive the House of Commons of opportunities for considering each agreement.

I should like to have an assurance from the Under-Secretary that it is not intended to deprive the House of Commons of any opportunity, on a proper occasion, of considering each particular agreement. On the other hand I think we should make sure that there is no intention to commit an error in the opposite direction, and introduce into this new sphere of business the obsolete and elaborate system of control which exists in regard to mail contracts made by the Post Office. I hope it is not intended to duplicate the cumbersome system which is necessary in regard to those

Major Sir ARCHIBALD SINCLAIR

I confess that when I saw the White Paper I was more hostile to it than I am now after hearing the speech of the Under-Secretary for Air. I shared the mystification which previous speakers have expressed as to the need for this Bill, and the only reason which occurred to me was that if the Money Resolution was voted and the Bill was passed the Secretary of State for Air would be free to spend a million pounds a year on this object without coming to the House of Commons. The Under-Secretary, however, has made it quite clear that there is no such intention and that every agreement will be brought before the House of Commons. The right hon. Member for Sevenoaks (Sir H. Young) has referred to the practice of other Departments of State, and the Air Ministry has entered into large contracts for a term of years which they have brought before the House of Commons without any need for the statutory authority which the Bill will provide for in the future. I ask the Under-Secretary, who has a mastery of the business of his Department, to make clear to the Committee exactly what the Bill is intended to do and how his Department will be in a position to act more effectively for the promotion of civil aviation in the future than they are at the present time.

It is quite true, as the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) has said, that this country leads in design and in air flying. Where we lack is in the actual mileage on our air routes. That is not a reproach on successive Secretaries of State for Air, who have shown great keenness in the discharge of their responsibilities; still less is it a reproach on the Air Ministry, who have devoted themselves to the promotion of the interests of civil aviation. It is a reproach on the country as a whole, on public opinion as a whole, on the lethargy and ignorance which have characterised the inhabitants of this country on this question. I am sure that the promotion of civil aviation will receive some little impetus from the general welcome which the proposals of the Ministry have received this afternoon but, obviously, there is great need for pressing on in this matter, and in so far as this Bill means that the Secretary for Air will have at his disposal larger resources for the promotion of aviation, bearing in mind what is the true test of progress, it will be helpful and to the advantage of this country.

The hon. and gallant Member for Central Hull referred to the possibility of handing over civil aviation to the Ministry of Transport. I hope the Under-Secretary will strengthen his grasp, and will not for one moment allow it to be handed to the Ministry of Transport. It would be a most retrograde step. We lead in design, and great steps are being taken by the Air Ministry in research work. In all these ways we are making progress. If we were to divorce civil aviation from the Air Ministry, which is the main source of energy in all these developments, and put it under another Ministry, where it would no longer share in the same research work or in design and construction development, it would be a most retrograde step. It is much better to allow all our research work to be centred in one Department, which can devote all its energies, with the full support of this House, to the development of all forms of aviation. In this way civil aviation gains enormously from its association with the developments on the military side.

Lieut.-Commander KENWORTHY

Has the hon. and gallant Member considered the analogous case of the mercantile marine and the Admiralty? What mercantile marine should we have had if it had been associated with the Admiralty?

Sir A. SINCLAIR

The formation of the mercantile marine preceded the formation of the Navy. In fact, in the mercantile marine you had the foundation of the Navy. In the air the development has been exactly the reverse. In the first place, you had a great military machine. Then you had this infant, this child, of civil aviation. The best way in which you can develop civil aviation is to give it the advantage of a connection with the developments which are mainly proceeding for military purposes. Therefore I hope that the Under-Secretary will give us a little explanation of the purpose of this Bill. So far as I understand its purpose and the policy which lies behind it, I give it my full support.

5.0 p.m.

Mr. MATTERS

I want to endorse in one sense the appeal made for some further enlightenment on the question of policy. The Prime Minister, replying to a question whether it was proposed to separate civil from military aviation, answered in the negative. He said civil aviation in this country was not under military control, that the Air Ministry was the Department which looked after civil aviation, and he added that the Government did not contemplate any alteration in the existing system. That is quite true. Civil aviation is under the Air Ministry, but nobody who is at all familiar with the conduct of the Department is under the slightest doubt that military needs are the basis of air policy, and these military needs—I am not complaining in the least—have a crippling effect on the development of the aircraft industry, and to a considerable extent on the development of aerial services in other parts of the Empire.

Reference was made to the situation in the West Indies. Those islands are peculiarly adapted to commercial air services. I am given to understand that the whole question of air services in the West Indies is under consideration by the Civil Aviation Department of the Air Ministry at this time. But it has probably been under consideration ever since aviation was developed, and nothing has been done in the West Indies. They suffer very badly from the lack of ordinary commercial steamship accommodation, so that the position is ideal for an air service. These islands represent ideal jumping-off places. The distances are not great, and an air service is probably, within reason, tine ideal system, for mail communication at least, and possibly passenger communication.

In respect of the airship construction industry, if I may discuss that matter within the bounds of this Resolution, the great difficulty is that the military needs of the Department are always paramount over the construction of machines of different types. It is agreed that the machines made here are recognised to have the best and fastest engines in the world, but they cannot be sold abroad except under conditions which practically make their export impossible. I think the Minister will agree when I say that excellent machines, probably superior to those of any aircraft manufacturing country in the world, are prepared here under the stimulus of military needs, but unfortunately the military needs dictate that the sale of these machines abroad can be permitted only after long and expensive tests.

The CHAIRMAN

The hon. Member is not in order in discussing the aircraft construction industry within the terms of this Resolution.

Mr. MATTERS

I am sorry that I cannot discuss this question: it is vital and has a most important bearing on the future of civil aviation, because unless aircraft constructors can turn out these machines under the sanction of the Air Ministry for aerial services, these services will have to suffer; but if I cannot, within the rules of debate, continue that subject, I must satisfy myself with saying that I do hope the Ministry will seriously consider whether it is not possible to a considerable extent to separate the military needs of the Ministry from the requirements of civil aviation, and in such remote parts of the Empire as the West Indies, and no doubt other areas, thus give a stimulus to civil aviation.

Captain HAROLD BALFOUR

I feel that I cannot allow this Resolution to pass without some words of protest against it, as I happen to disagree on major points with every speaker who has spoken on it. I will start with the hon. and gallant Member for Hull (Lieut.-Commander Kenworthy). He spoke of the possibility of an air service from Galway across the North Sea. But the prospects of civil aviation vary inversely to the facilities of other forms of transport over a particular area. If there are roads or good railways the chances of civil aviation are very small as compared with the prospects from one place to another in, say, Western Australia or Canada; and when the hon. Member suggested that this service was a crying need he was speaking with that eloquence and sincerity which everybody admires, which gives him always Hull as the centre of his arguments, whether he is speaking of aeroplanes or trawlers. The right hon. Baronet the Member for Chelsea (Sir Samuel Hoare) sits on my own Front Bench, but I should like profoundly to disagree with a great deal that he said, and I do not think I entirely agree either with the gentleman who spoke just before him. The right, hon. Member for Chelsea has to defend a continuation of what he initiated, and, while I have the honour of sitting on these benches, it is what I shall never be afraid to condemn from the point of view of one interested in aviation.

There are eight more years to run of this monopoly, this agreement, with the Imperial Airways, and although we are voting £1,000,000 for a subsidy we are really voting the greater part of that subsidy to Imperial Airways. The right hon. Gentleman said that long-term agreements are eminently desirable. I think they are, but a long vision is even more desirable than a long-term agreement, and I cannot see the end of the 10 years' agreement into which we entered with Imperial Airways carrying us very much further towards making that company a self-supporting economic proposition. The reason I make that statement is that the whole basis of the present agreement for payment of subsidies on air lines in this country—and although we talk of air lines we have only one, and that is Imperial Airways, so that I am quite sure no hon. Member will take exception if I use the name of Imperial Airways—the basis of our agreement with that company is a policy which is not good for aviation under the conditions in which the subsidy is paid. It is based on a policy which, as results prove, is good for certain portions of aviation. It is good for safety and poor for machines, it is excellent for the shareholders, but it is very poor as far as the development of our civil aviation goes.

There had to be a start somewhere, and I want to say—I was not in the House of Commons at the time, but I have had something to do with aviation—that it was a splendid start. Do not let us continue, however, to shut our eyes to the fact that there will have to be a quick change of direction when the subsidy agreement comes to an end. I know the Government is bound to this long-term agreement, but long before it comes to an end we shall have to warn Imperial Airways and other companies that we shall not necessarily continue. We must not in the ninth year wake up to find a financial crisis, the whole country saying that civil aviation must go on, and that a subsidy is wanted in order to keep it going. I think this Resolution will be passed, but I would give it with considerable reluctance unless there is to be some long vision which has as its ideal the making of aviation a self-supporting proposition, not from London to Manchester, but possibly from Montreal to Vancouver, and across Australia. Let us think of long distances, and, if necessary, let us spend on them some of the money we have spent in the past. We should shut down the London to Paris service if that were needed in order to have an Indian or Australian service. If we are to give this money, I hope it will be with a view to an aviation which in the future will not be dependent on the House of Commons passing such a Resolution.

Mr. MANDER

I think the hon. Member was unfortunate in saying that services succeed in indirect ratio to the existence of inland transport. There is, for example, the service from Croydon to Le Bourget.

Captain BALFOUR

I did not say that the air service was not working satisfactorily from some points of view, but as civil aviation it is a failure, because it can never be self-supporting. If you are going to judge on success of running, it is a success, but as an economic proposition it is a failure.

Mr. MANDER

That is for the future to decide. The hon. and gallant Member holds one view and I hold another. In rising to support this Resolution, I would like to put one or two questions. In the last 10 years I have made a great deal of use of facilities for air transport to the Continent and back, and I should like to pay a tribute to the care and skill of the pilots and to the efficiency of the ground organisation which has built up a service second to none in the world. I want to ask if this grant would be available for such a purpose as this: The Belgian Sabena Company runs a service from Brussels to London regularly. Would it be possible to pay a subsidy to that service in order that letters posted one night in London could be taken to Brussels and delivered there next morning and vice versa? Would it be available for that purpose, or would that be a matter for an Estimate by the Post Office? I should also like to know whether this money would be available for the airship service? Suppose the R.100 or the R.101 were to run a service to Montreal, would the money which we are now voting be available for a purpose of that kind?

What other routes are contemplated? There is a service running to Delhi, and there has been a statement made that that service will ultimately be extended to Calcutta, Rangoon, and then to Australia. Has the Under-Secretary any further in- formation on that point? I would like to know if the Government contemplate any other services in addition to those to Australia and South Africa? Do they contemplate establishing a service to the Irish Free State or to Ulster? I should also like to ask a question in connection with the service now running to India. Has it been definitely decided not to continue negotiations with the Italian Government for running down the coast of Italy, and has it been decided to continue the service via Athens? I hope that is so, because it is a quicker route, and, in those circumstances, no useful purpose would be served by continuing the negotiations with the Italians when a better alternative route is available.

I should like to ask whether, in making the grant for a subsidy, it would be possible to attach conditions for controlling the type of machines to be used, or the engines. For example, would it be possible to make a condition that a three-engined machine should be used for a particular service? I think Imperial Airways continued too long with their two-engine Handley Page. I hope that we shall be able to insert some conditions giving control over the type of the machine, and the number and power of the engines that may be employed. Will any of this money have any conditions attached to the granting of it relating to the military side of aviation? There is a general feeling amongst nations dealing with disarmament that civil aviation should be allowed to develop on its own. I think it is very important that we should not allow any connection to grow up between civil and military aviation, and I should like the Under-Secretary to assure us that there is no sort of connection and no thought of dealing with aircraft from the point of view of development for war purposes. I hope that we shall have a clear and definite assurance on that subject, and, if we do not have such an assurance, I am sure many hon. Members will be very dissatisfied. Those are the only points I wish to put to the Under-Secretary, and I hope that he will be able to give an answer to them.

Mr. MONTAGUE

I have been asked to explain more fully the reasons for this Resolution and the necessity for moving it. I have also been asked a question about long-term agreements. The reason for making long-term agreements a matter of statutory authority is simply to bring the whole question of air transport subsidy into more satisfactory relation to constitutional usage. It has been felt that on the whole it would be more satisfactory, as well as in accord with established usage, to give the Secretary of State for Air express statutory power to make agreements of the character under consideration, that is to say, if such agreements are made they should be made under definite statutory authority for the whole period, whatever changes there may be in Parliament.

So far as procedure is concerned, there is no proposal whatever to make any difference. The main provisions of the agreements which have been approved hitherto have been issued in the form of a White Paper, and the whole question of subsidies has been under discussion when the Air Estimates have been introduced. That means that while in the past there has been no doubt whatever about the authority of Parliament, it has nevertheless been thought necessary to give this definite statutory authority which I have already explained. This is merely a question of constitutional usage, and the placing of air transport subsidies under the same constitutional usage and procedure that applies to other Departments. That is my answer to the questions which have been asked me in regard to what happens in the case of the Admiralty and the Post Office.

I must take exception to the way in which hon. Members have been speaking about an annual expenditure of £1,000,000. That sum is a gross covering figure, but there will not be an expenditure of anything like £1,000,000 for the purposes indicated by the hon. Member. I only wish there were such a sum as that available for civil aviation. With regard to subsidies this year for the London-Karachi route, the total is £333,000, which is a long way from £1,000,000, and the subsidies, even after including further subsidy in respect of the anticipated extension for the South African service, are in the nature of diminishing subsidies, and there is a gradual diminution of the amount year by year. It is hoped and believed that, within the amount appropriated, it may be possible to extend the advantages of civil air transport. The gross figure has to be taken into account in relation to appropriations-in-aid. The expenditure incurred for the South African service include considerable appropriations by the South African Government and other Governments in the areas in which the service will be run at the end of the year.

I am asked whether this Resolution and the Bill will allow money to be spent on the subsidising of airships. The word "subsidising" seems to have been confused with Government expenditure for development. I would like to point out that we have spent a good deal of money on research and development in connection with our airship programme. The question of subsidies has to do entirely with the policy that will be decided upon after the airship tests have been undergone and when we know the exact position, and that expenditure is quite apart from any further development for commercial purposes.

Mr. MANDER

Then it would be quite in order to use the money for such purposes?

Mr. MONTAGUE

That is what I was going to say. If commercial aviation develops, it will be possible for the money to be used in that way, just as it is used for subsidising the development of heavier-than-air transport services. The question of the monopoly policy in regard to existing subsidies to Imperial Airways has been referred to. Subsidies will last for a number of years. That does not mean a monopoly of services, but it is a policy which was decided upon as an experiment as the result of previous experience and the direct outcome of the conclusions of the Hambling Committee. We were compelled to accept the principle of the monopoly subsidies. Competition was tried before the present system, and it was a disastrous failure. May I quote the conclusion of the Hambling Committee on that point? They say: We believe strongly in the many-sided advantages to be derived from healthy competition in business, but we cannot apply that description to the competition which existed between the British operating companies under the 'temporary' and 'permanent' schemes, nor do we think it could be applied to any competitive conditions which could be created in civil air transport as it is at present. The amount of the subsidies and compensations paid by the Air Ministry under these schemes was approximately double the passenger and freight revenue, so that the burden of the financial risk was mainly on the Government, which was, therefore, in effect competing with itself. There was not sufficient demand for air traffic to afford the conditions essential to real competition, and the result under the 'permanent' scheme was, therefore, to increase the number of British aeroplanes on the London-Paris route, with consequently increased expenditure on flying costs, insurance, and depreciation, and to reduce the number of passengers per machine, while the unnecessary cost of separate organisations and independent managements was maintained. I think that that is a very fair explanation of the reasons why a monopoly subsidy policy although not originally undertaken, was ultimately imposed upon the Government of the time, and I am afraid that the existing condition of civil aviation, both in regard to European and Imperial routes, is very little different now, from the point of view of the necessity for concentration and the avoidance of waste in unnecessary competition.

With regard to the comparison that was made by the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) of our services with those of foreign countries, it is not strictly correct to say that this country is seventh in order in Imperial mileage, because, if you are going to make comparisons, you must make fair comparisons—you must compare Imperial conditions with Imperial conditions; you must compare Imperial services with Imperial services. If you do that, and treat the other countries upon the same lines, we are not the seventh, but the second. The total number of British Empire aerial miles flown is 20,850, without taking into account the Projected South African services. That is the second largest mileage, the first being that of the United States of America, which is 46,622. France comes next with 17,500, and then Germany with 16,500, and Italy was 7,303. That is taking, in each case, not merely internal lines or lines going out from the major country, but the whole of the services which can strictly be described as belonging to the respective countries and their interests, and in that respect the British Empire does not stand seventh, but actually second in mileage, while it is true to say that our standards of efficiency in aircraft manufacture, and, even more important, our standards of safety, bear very favourable comparison indeed with any other similar standards in any part of the world.

Lieut. - Commander KENWORTHY

When my hon. Friend talks of the distances of the routes flown, can he compare the number of machines operating? Obviously, if you fly a certain route once a year, you can total that up, but I hope that what my hon. Friend says will bear every investigation.

Mr. MONTAGUE

The figures I have given are actual mileage figures, not passenger miles. So far as it may be true that you can have a long mileage with very little service and very few passengers, the comparison would be rather in favour of this country than against it, because it is in the long services of some other countries that you have infrequent flights. I cannot at the moment give the particular countries, but I have come across a number of instances where there have been long mileage arrangements but where the passenger mileage was comparatively small, so that really that fact would make the position of this country more satisfactory than otherwise.

With regard to the position in the West Indies, no one regrets more than I do the fact that it has been impossible so far to find a satisfactory solution of the problem in regard to the West Indies. It is a problem which has to do, not merely with Air Ministry initiative, but with the whole question of finance, and it is a matter of inter-Colonial communication and not Imperial communication. That means, of course, that it is necessary that there should be interest to the extent of practical and financial assistance from the Colonies involved. That is not a very advantageous prospect at the present moment. The Colonies are poor, except Trinidad, and, so far as Trinidad is concerned, we do not find that there is very much chance of obtaining financial support at the present moment. That, however, does not mean that the Air Ministry are leaving anything undone that can be done in order to get aviation services going in the West Indies. It will be recognised, of course, that the West Indies are a link between Canada and South America—a very important link in what might be a very valuable and important commercial relationship: and the civil aviation side of the Air Ministry is doing everything possible. I think that the hon. and gallant Member for Caithness (Sir A. Sinclair) knows what we are doing. We are doing everything possible to get things going in the West Indies, and we have an eye also to the larger Imperial issue of relations between Canada and South America.

I was asked whether the practice will be altered. My answer is "No"; that is to say, the House will have a full statement of every project and every suggestion for expenditure of money upon subsidies in the way that it has had in the past, and just as much opportunity of discussing the whole question of subsidy policy and civil Air policy as it has had.

The exceedingly interesting question has been raised of the relations between civil aviation and military aviation, and it has been suggested that military needs have a crippling effect upon civil aviation and the civil aviation industry. I can assure the Committee that that is not the case. Military aviation does not control the policy or the work of the civil aviation side of the Air Ministry. The reason why the two are associated is fairly well known, I think, at any rate to those who have studied closely the question of aviation generally. It is, as has been pointed out, that, from the standpoint of research, of design and of structure, and from the standpoint also of ground organisation, military and civil needs are almost precisely the same, and they cannot at the present moment be separated. They use the same engines, they use the same principles of propulsion, they use aerodromes of the same character, and meteorological services of the same character. The whole thing is one at the present time, and for that reason it would be not only unwise, but I think disastrous for civil aviation, if it were taken away from direct association with military needs.

That, however, does not mean that military needs have a crippling effect so far as the industry is concerned. I think it would be true to say that but for military needs there would be no civil aviation industry at all in this country. The industry depends upon the demand for military machines, and in that way again, in the actual conditions of the production of craft, the two sides of aviation in this country are inextricably mixed, and they could not with any advantage be divided at the present time, whatever might be the possibilities in the future. From the standpoint of ideas of militarism, I can, however, assure the Committee and hon. Members who are interested in the subject that there is, I will not say no possibility, but no actuality of interference by the military side on behalf of military needs with the fullest possible development of civil aviation.

With regard to war purposes, the hon. Member who raised the question wanted to be assured that the Air Ministry had not in mind any question of war purposes at all. It is as well to be frank. Of course, the Air Ministry has in mind the question of war possibilities. That is part of the business of the Air Ministry. Aerodromes are serviceable in time of war; pilots are necessary in time of war; particular kinds of planes are required. How far airships or the ordinary commercial planes might be adaptable I do not know; I am not a technical expert; but, of course, an Air Ministry must have these things in view: that is to say, it must take account of the fact that, in regard to routes, for instance, the route from one part of the world to another is very probably not only commercial, but strategic. All these things must be considered if and when you are considering the subject of potential war; but that is not the same thing as saying that war policy and war ideas govern the question of aviation so far as commercial development is concerned.

The only other point with which I have to deal is, I think, that with regard to Italy. If there are others, there will be plenty of opportunity for me to deal with them in greater detail on the Second Reading of the Bill or on the Report stage of the Resolution. With regard to the question which was asked as to the route via Athens to Alexandria, the negotiations are still being undertaken with the Italian Government, and it is anticipated that before long satisfactory arrangements will be made for a route via Corsica and Naples to be undertaken. I do not know if that is a sufficient answer to the hon. Member who asked the question. I have tried to deal with all the points that have been raised, and I hope that we may now have the Resolution.

Question put, and agreed to.

Resolution to be reported To-morrow.