CUNARD (INSURANCE) AGREEMENT BILL. (Hansard, 20 November 1930)

§ The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. W. R. Smith)
I beg to move, "That the Bill be now read a Second time."
It is not necessary for me to say a great deal, because the subject was fairly and extensively examined when my right hon. Friend moved the Money Resolution in connection with the Bill. I am encouraged in that view by the fact that on that occasion the Bill was welcomed by all sections of the House and that, I venture to think, very largely because it is in itself a contribution towards providing employment in an industry which is very much in need of it, and more especially in the district in which the proposed ship is to be constructed. The position is this. The Cunard Shipping Company, which in the past have achieved a great distinction in the ships that they have put upon the various seas, and particularly upon the Atlantic, are making a further attempt to bring more distinction to British shipping and to bring back what might be termed, if not the blue riband of the Atlantic, certainly a position of success as far as shipping is concerned. But the magnitude of the task is such that there is a doubt as to whether or not the insurance can be covered by the ordinary means, through the ordinary insurance companies, and what the Government have consented to do by the agreement that has been entered into with the Cunard Company is to provide the insurance that they may not be able to obtain in the open market. The conditions of that insurance were very fully explained on the Money Resolution, and I do not know that I need enter into them in any detail.
I will give some figures so far as the size of the ship is concerned. The information that I have is that the new ship will be 1,018 feet in length, which I 806 am advised is about 15 times the length of the "Aye" lobby; it will be of about 73,000 tons and will have in cubic feet about 7,300,000. I think these figures will indicate that this ship is one of considerable magnitude. Having regard to the fact that the Government have entered into this agreement—to take up the balance of the insurance that the Company may not be able to obtain in the ordinary insurance market—I ask the House to give a Second Reading to the Bill.

§ Mr. ALBERY
When the matter was last discussed in the House we were told that the rate—I think it was 30s.—was to be charged for the construction. I want to ask whether any steps have been taken to make sure that this is in fact a reasonable rate. I also wish to remind him that on that occasion a statement was made that the Chairman and Vice-Chair-man of Lloyds had given him an assurance that at least half the amount of this risk would be placed with underwriters at Lloyds. If this is wrong, I stand to be corrected.

§ Mr. W. R. SMITH
What my right hon. Friend said was that we had received the very fullest assurance from Lloyds that the rate proposed to insure the ship was reasonable so far as the market rates were concerned. I do not think he said that Lloyds would take up half of the insurance, hut he did anticipate that at least half of it would be taken up through the ordinary market.

§ Mr. ALBERY
do not think that differs in substance from what I have said—that he can anticipate that about half the insurance for construction purposes can be placed with underwriters at Lloyds.

An HON. MEMBER
No, he never said so.

§ Mr. ALBERY
I am not particularly well versed in insurance and I only want to clear up one or two points. Has the 807 right hon. Gentleman had any advice as to what proportion he is likely to be able to place in the marine market? The Government may have to take up the whole of the premiums, and that is a thing which we must take note of. I should like to know whether the hon. Gentleman has any further information on that point.

Lieut.-Colonel Sir FREDERICK HALL
I welcome the suggestion of the Government in a scheme of this magnitude. There never has been a ship like the one proposed. It is estimated that it will cost between £4,500,000 and £5,000,000 sterling. It shows plainly that if we are to bring back the blue riband, which I hope to see brought back to this country, if we are to maintain our position of supremacy in the mercantile marine, we have to go ahead, and I congratulate the Cunard Company for the pluck and courage they have had in going into the question of the construction of a ship of this magnitude. I say, further, that if it had not been for the help of the Government the Cunard Company might have been in a difficult position to find sufficient cover for about half the value. My hon. Friend referred to the question of marine insurance, and he is under the impression that perhaps it may be necessary for the Government to assume the whole risk. I have never heard any suggestion of that kind, and I do not think that my hon. Friend need worry upon that score. I should hope that the market would be able to cover somewhere in the neighbourhood of £2,500,000. I am sure from my knowledge of the marine underwriters that they will do all that they possibly can, in any reasonable manner for the safety of their book, to take up as much as possible of this business. They have always recognised that their duty is not only to cover insurance plainly and simply, but to render any assistance that they can to the great shipping community.
There is one question I would like to ask the hon. Member with regard to the schedule. On page 7 reference is made to premiums payable to the Board of Trade, and it says: in respect of the insurances against ordinary marine risks premiums at the respective gross rates payable in respect of the corresponding insurances placed in the open market with the addition in both 808 cases of two and one half per centum of the said gross rates and subject to deductions in both cases from the rates so augmented of It is a recognised custom in the insurance world that insurances of this nature are subject to a brokerage of 5 per cent. and 10 per cent. discount, and I want to make plain that there is to be no additional charge on the shipping community; that it is not the intention of the Government to debit the shipowners with an additional 2½ per cent. of the premiums, but, on the other hand, that the Government are going to give the same returns in commissions and discounts, because I do not think it is the intention of the Government to go into the transaction from a profitable point of view. I hope there is to be no cheese-paring, and that it does not mean that there is to be 2½ per cent. additional charge on the premium. Perhaps the hon. Member can make that plain. I only want to say once more that I appreciate the efforts put forward by the Cunard Company.

§ Mr. BROCKWAY
I want to put one question. In return for this service which the State is rendering the Cunard Company, are any conditions being required regarding wages arid the charges which are to be asked from the public by the company?

§ Mr. THOMAS LEWIS
On the Report stage of the Financial Resolution, my colleague in the representation of Southampton raised the question of the accommodation for seamen on these ships. I think he was ruled out of order and told that he could mention it on the Second Reading of the Bill. I recognise that this subsidy is of rather an unusual character, and one is loath to oppose it. I am aware of the great importance of these ships from the point of view of employment. But I think it will be news to most Members that the accommodation for the crew on these palatial liners is of the worst possible description. The conditions are nothing short of abominable. Every possible luxury—luxury almost unnecessary on account of the shortness of the trip of five-and-half to six days—is provided for the passengers. There are swimming baths, tennis courts, and every other luxury, but the quarters of the crew are of the worst possible description.

§ Mr. PYBUS
Have you seen the plans of the ship?

§ Mr. LEWIS
I have seen all the ships that sail from Southampton. I have visited the "Olympic" and other ships, and for 20 years I have been urging the importance of improved conditions for seamen. I went upon a deputation to the late Prime Minister when he was President of the Board of Trade eight years ago. He was very sympathetic and was staggered with the position put before him by the deputation. He promised to visit Southampton at an early date, but nothing has been done. For years and years this question has been brought to the notice of the Board of Trade, and I am merely asking whether the President of the Board of Trade will put in a request—he cannot demand it; the thing has gone too far—on behalf of these men who follow the sea. We talk of the slums of our towns, but these slums of the sea are ten thousand times worse than the slums we so often describe in this House. It is the cause of a tremendous amount of ill-health among seamen. The health of the seamen is absolutely the worst of all occupations; far worse than the miners, and most of the sickness and ill-health are due to the accommodation on the ships. The accommodation is worse on the big liners than on the smaller 810 ships. I ask the Minister to make inquiries into the hygiene of the crews' accommodation. They are divorced from civil life and for 40 weeks out of the 52 they are on the seas, and it is the place of the Government to see whether they can put in a word with the Cunard Company asking them to give better accommodation than is now done. If they do that it will be one of the finest things that the Board of Trade has done.