NATIONAL ECONOMY BILL.

HC Deb 14 September 1931 vol 256 cc527-648

Order read for resuming Adjourned Debate on Amendment to Question [11th September], "That the Bill be now read a Second time."

Which Amendment was, to leave out from the word "That," to the end of the Question, and to add instead thereof the words: this House, whilst recognising the necessity for preserving the country's finances on a sound basis, cannot accept proposals which will deprive masses of the people of necessities of life whilst others remain in the enjoyment of luxuries, and will aggravate unemployment by restricting the purchasing power of wage-earners; nor can this House approve the Second Reading of a Bill abrogating Parliamentary control by authorising the making of Orders in Council designed to supersede existing Acts of Parliament or reverse settled national policy without the previous specific assent of the House of Commons.

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

Mr. ARTHUR GREENWOOD

I propose to take up this discussion at the point where it was left by the somewhat provocative speech of the Secretary of State for Dominion Affairs, but let me say that I am not going to spend all my time in unseemly and futile discussion of what has happened in the past. I am not going to ignore that aspect in the opening of my speech, but I do wish, as soon as I can, to pass to the substance of this Bill which, so far, has not been discussed in the House. Certain statements were made and were hailed with great enthusiasm by right hon. and hon. Gentlemen opposite as to what happened on occasions when none of them were present. I have been brought up in the belief that majority opinion should prevail. In present circumstances, the words and the views —honestly held —of a minority sitting on the opposite side of the House, are accepted by large numbers of people as against the views of the majority sitting on this side.

I do not wish to repeat what has been said by the Leader of the Opposition and my right hon. Friend the Member for Central Edinburgh (Mr. W. Graham) as to what happened, but the impression which remains indelibly printed on my mind is that during all the discussions which took place on this proposal and that proposal, the suggestions put forward were purely tentative in character; that no decision of any sort or kind was taken, and that the Prime Minister himself repeated that time and time again. Indeed, he himself was reluctant to come to decisions — [An HON. MEMBER: "He always is."] —for reasons that we now know, because it appears that he favoured proposals far in excess of any that had ever been submitted. I illustrate that statement with one case. When the Cabinet committee of which I was not a member — [An HON. MEMBER: "What a pity."] —I was nearer to it than the hon. Member opposite. When the Cabinet committee came to the larger body of responsible Ministers, there was no suggestion that the rate of unemployment benefit should be cut. If there ever was a decision taken by the Cabinet it was that, and yet that very question was raised again and again, day after day. There was no decision on that or any other question which was binding on the Members of the Cabinet. That was the position which all of us took. When the right hon. Gentleman the Secretary of State for Dominion Affairs was speaking on Friday of the difficulties of those who were negotiating with outside bodies he said: I at once say then that if the conception is that the Prime Minister and the Chancellor of the Exchequer, representing the Government of the country, are told by their colleagues to go and meet someone else, and tell them certain things provisionally, what is the decency and where is the decency of repudiating it afterwards?" [OFFICIAL REPORT, 11th September, 1931; col. 487, Vol. 256.] The right hon. Gentleman is far more skilled in industrial negotiations than I am. [HON. MEMBERS: "Hear, hear!"] That is the point of my argument. The right hon. Gentleman knows perfectly well that all kinds of tentative suggestions are made on such occasions. I have no doubt that the right hon. Gentleman himself, in the course of a very long and distinguished career as a trade union leader, has himself "tried it on the dog" in putting forward suggestions, and has not regarded himself as having made a specific promise or given a definite undertaking.

The SECRETARY of STATE for DOMINION AFFAIRS (Mr. J. H. Thomas)

We have reached a stage at which it is very important, and I am sure that my right hon. Friend in his opening speech made it clear, that we should at least agree on what are the facts. I put this to my right hon. Friend. I was not dealing and did not on Friday deal with anything about the unemployed proposal, but I ask him now this question about the £56,000,000 which, according to the "Notes to Speakers," issued this week was "provisionally accepted." Those are the words of the Leader of the Opposition and also in "Notes to Speakers "—

The CHANCELLOR of the EXCHEQUER (Mr. Philip Snowden)

Issued by the Labour party.

Mr. THOMAS

Yes, issued by the Labour party this week. I ask my right hon. Friend to tell the House, would he say that the teachers' 15 per cent., the soldiers and sailors, and all the other items, were accepted by him, if that had been agreed to?

Mr. GREENWOOD

This is really a pure quibble about words. It is all right for the right hon. Gentleman to say that I have introduced the question of unemployment. I have done so to prove my contention that there was nothing in the nature of a decision made by that larger body of Ministers, and that the suggestions put forward were put forward primarily as extracts from the May Report, which obviously the Government had to consider, and were put forward as tentative suggestions.

Mr. W. THORNE

And that was said on Thursday afternoon.

Mr. GREENWOOD

It has been said time and time again, but we shall have to go on saying it. Nobody was expected to be hound, and I never expected any- body to be bound, by these proposals until the whole set of proposals had been collated. That is the situation as far as 14 or 15 Members of the old Cabinet are concerned. I deplore the difference of opinion. [HON. MEMBERS: "Why!"] Well, I do deplore a difference in the interpretations which are being put on events, but to those of us on this side of the House it is clear that we did not give any kind of final binding undertaking about any single provi- sion. [Laughter.] Hon. Members seem to be amused, but I am stating my view. As I say, I am sorry about these differences of interpretation as to what happened, and, though I am not prepared to run away from that subject, I do not think that it is the major question before the House.

Before I leave that part of the subject, however, I would like to refer to the question which the Prime Minister put on Friday to my right hon. Friend the Member for Platting (Mr. Clynes). He asked, as between £70,000,000 and £56,000,000, whether the £14,000,000 is a difference of principle or not. The implication in what the Prime Minister said was that it was a matter of degree. I say that it was a matter of principle, because we had then got back to the point as to whether, whoever else suffered, the unemployed were to suffer with them; and, if there was one question more than another which led a number of old colleagues to part ways, it was this very question represented by the difference between the figures quoted by the right hon. Gentleman.

The real difference, if I may put it so, between the late Government and the present Government is that the late Government were prepared to consider all possible proposals, however drastic they might be, if they would achieve true equality of sacrifice. So far as the present Government are concerned, they seem to have swallowed the May Report holus bolus, including the cut in the rates of unemployment benefit, and have not given us, as I will try to show in a moment, that equality of sacrifice of which hon. Members opposite are so fond of talking. That really was the breaking point. It was on this matter of who was to foot the bill, and we parted company simply because a number of us could not accept the view of equality of sacrifice taken by the other two political parties and the banks. I say that, realising the difficulties with which the late Government and the present Government were faced, but it seems to me that if this was to be the way out of it demanded by other parties in this House, demanded by interests outside this House, then those who believed in that policy ought to be the instruments for carrying it out.

I should prefer, myself, to come to the form of the Bill, because, as I say, on Friday we did not have a great deal of light thrown on the Bill either by the Prime Minister or by the Secretary of State for the Dominions and Colonies. This Bill is proposed legislation which will leave the House in complete ignorance, or almost, complete ignorance, of the things to which it is committed. The only information that we possess—it cannot be drawn from the Bill—is to be drawn from Command Paper No. 3952 which has been circulated, and it is important that we should examine what it is that we are leaving in the hands of the Government to deal with by Order-in-Council. There is the question of education, the question of teachers' salaries, on which hon. Members in all quarters of the House are thoroughly unhappy today, a question which is to be settled, not by full and complete negotiation, but by the fiat of the State, for these things are to operate on the 1st October. We are to leave them to a process of what they themselves call a general slowing down of the service and further economy measures, quite unspecified, which are going to reduce the cost of the education service.

I think we ought to know, before the Second Reading of the Bill is adopted by the House, what this slowing down means. Does this slowing down mean a postponement of the building of new schools to meet growing populations, in the areas of new housing districts? Does it mean the postponement of building to meet the needs of overcrowded schools and bad schools7 Does it mean a restriction of the school medical service? We do not know, and as for the other economies contemplated, they are not specified either. I should like to know how far this restriction of education development is to cut into the substance of our education system, and the same, of course, applies to the Ministry of Health, for the very same words, these ominous, sinister words, appear under the Ministry of Health and the Department of Health for Scotland: It is expected that there will be some slowing down as a result of the measures for regulating development. We are entitled to know what that means, because those so-called economies may prove to be ultimately disastrous for the nation. We were hardly out of office before local authorities up and down the country which had always been reluctant to undertake the necessary expenditure took the bit between their teeth and passed the wildest resolutions about economy, postponing their housing schemes and indefinitely postponing all kinds of schemes of development; so much so, that the Government themselves got alarmed and appear to have taken some action last week to restrain the most reactionary of the reactionary local authorities. Therefore, we are entitled to know, when we are agreeing to economies in the Ministry of Health expenditure, what form these economies are going to take. I would like to ask the Minister of Health whether he has any proposals which in any shape or form will slow down the building of working-class houses from now on, and whether his new colleague, the Paymaster-General, whom we used to know as the right hon. Member for Penryn and Falmouth (Sir Tudor Walters) and the Minister of Health see eye to eye about the rural housing question. The ink is hardly dry upon that Statute yet, and we should like to be assured that the enthusiasm and energy of the new Paymaster-General are going to be behind the success of that particular piece of legislation.

4.0 p.m.

I should like to know whether the Minister of Health proposes to adopt that proposal of the May Committee's Report which suggests a reduction of the housing subsidy next April. We know that he is capable of it, because he has done it before. He did it once or twice before. Once, by the grace of God, we stopped him before it was too late, but he is quite capable of doing it again, because he takes, and is entitled to take, a different view of the solution of the housing problem from the view which I take myself; and, if he is not going to make any reductions of subsidy by Order-in-Council, is he by administration going to do anything which will in fact slow down the building of houses, because slowing down appears to be the order of the day in the Board of Education and the Ministry of Health? I should like to ask him whether, in his consideration of the financial aspect of the problem, he has thought about the Prolongation of Insurance Act and whether or not that is to go by the board before the end of this year. I would also like to ask him whether the rapidly developing maternity service, which has shown some considerable growth in the last 12 months, is to come under this slowing down process, which appears to be now the considered policy of the Department. Then something must, of course, be said about the question of unemployment, because here we get to the question which really marks off that side from this side more than any other single question. Ten per cent, off the unemployment benefit is the price which the unemployed of the country has had to pay for the establishment of a National Government composed of and supported by people for whom nothing leas would do than that cut of 10 per cent. It is this proposal more than any other proposal which has won the enthusiasm of Tory Members of this House. Nothing would satisfy the older political parties but that. They have had their way, and the unemployed were sold for a mess of pottage, £12,800,000. The seriousness of the cut is not confined to its immediate effects. What always influenced my mind was the repercussion of any cut on the unemployment benefit upon present wage levels, for there is a good deal of evidence that employers' organisations in recent years have repeatedly pressed for a revision of the unemployment benefit, because they were unable to revise wages without it.

Therefore, it follows that, in addition to this cut in what will be received by the unemployed, in addition to the cuts in wages which will be forced by the Government on servants whom they can directly or indirectly control—[An HON. MEMBER: "What about Civil Service wages?"] I am on the general question. In addition to the cut in unemployment benefit, in addition to the cut in Civil Service salaries, in addition to the cut that is to take place in the wages of municipal and other officers, there is going to be, following this, a general drive for the reduction of the present wage level, and the effect of such a reduction in the standard of life—an immediate reduction in the standard of life—will make no contribution whatever to the restoration of trade, and will intensify the situation at home by restricting the home market. Therefore, the proposal to cut unemployment benefit is, perhaps, the most far reaching of all the proposals put forward by this Government, and, per- haps because of its far reaching nature, has received such enthusiastic support from Members on the other side of the House.

But we must go a little further with this question of unemployment, benefit. I, myself, want a little more light on this aspect of the problem of the transitional benefit period. Under the procedure referred to, the Exchange will request the Public Assistance Authority to assess their need and to determine the amount payable (not exceeding the rate for ordinary benefit) and such determination will be final. This will put upon public assistance authorities a new responsibility, a new work, for which there is to be no State assistance, and I think that this new function of doing the dirty work for a Government Department is not one which local authorities should be asked to do.

Mr. THOMAS

If we are going to argue it fairly, is it not true that, having considered the whole thing, my right hon. Friend who is now speaking agreed that. a means test was essential?

Mr. GREENWOOD

There was one thing on which I was clear, and the right hon. Gentleman knows it, that never would I have agreed to the unemployed going to the Poor Law. [HON. MEMBERS: "Answer the question."] I am going to give my answer. I was prepared, and I am prepared, to agree to-day to a national scheme which involves the investigation of the question, but not under Poor Law auspices, for remember what this means. It means that these people will still receive the Poor Law taint. They have to be assessed by the Poor Law, and not only so, but the public assistance authorities are forbidden to give any family, however urgent its need, any more than the rate of unemployment benefit. That is a new principle of Poor Law administration in this country. It has never happened before. Indeed, it is fundamental to Poor Law administration that you grant relief according to need, and not according to a fixed scale laid down outside by reference to some other scheme. And when one looks at the figure that will be saved by this, £10,000,000, it is clear that, in addition to the cut in unemployment benefit, there is going to be a substantial cut in the amount of money granted to transitional workers after they have been to the public assistance authorities, and I should have hoped that all parties in the House would have done their best to have kept the unemployed from contact with the Poor Law system. There are in other parts of this Command Paper other suggested economies of which we have no particulars.

Viscountess ASTOR

The right hon. Gentleman said he would be willing to have a means test, but not under the Poor Law. Could he tell us what plans he has to deal with it?

Mr. GREENWOOD

When I change over I shall be very glad to do it. I do not think I am called upon to suggest the details of a national scheme for dealing with the unemployed.

Mr. DIXEY

The right hon. Gentleman is in full possession of the facts and has made a very interesting point. Those on this side who were not present at the negotiations would like to know the nature of the means test which he himself would have agreed to in the Cabinet Council.

Mr. GREENWOOD

The hon. Member is a little late. I have passed from that point. I am not here to answer the hon. Member's questions.

Mr. SPEAKER

We have a definite time for this Debate, and we shall get on much better without interruptions.

Mr. GREENWOOD

I am putting questions to the Government. I look at page 12, and I find some more miscellaneous economies. After we have miscellaneous economies in every Department, not specified, we have some kind of super-economies amounting to £2,500,000. The House should ask itself whether it could give honestly a Second Reading to a Bill which leaves all these questions unexplained. That, however, is not my fundamental objection to the Bill. My fundamental objection to it is that, as it stands now, even with the present Budget proposals, it does not achieve anything like equality of sacrifice. I do not think that if we are measuring sacrifice, we should concentrate on what is taken from people, but rather on what is left. [An HON. MEMBER: "A platitude."] It may be a platitude, but it is true, and it is a platitude which the hon. Gentleman does not seem to have understood yet, because, as I understand it, emphasis is being laid on what is being taken away rather than on what is being left.

It is all very well for people who do not have to do it in the real physical sense to talk about tightening their belts, but there is all the difference in the world between people foregoing certain superfluities, curtailing comforts, and, on the other hand, sacrificing real necessities of life. As a matter of fact, this Economy Bill will leave considerable numbers of people enjoying the same kind of easy, spacious life they have been enjoying in the past, and making nothing which in justice can be called a sacrifice. On the other hand, a very much larger number of people among the manual workers and the professional workers will feel in varying degrees the real pinch of the shoe. They cannot go and get another pair of shoes. The shoes they wear will pinch them hard. They are being called upon to make real sacrifices, and in hundreds of thousands of homes not confined to one single class, the economies will mean narrower and harder lives and restricted opportunities. But not so for the smaller and more fortunate class of really well-to-do people.

In those circumstances, "equality of sacrifice," which is a very fine phrase with a very fine meaning, becomes a mockery. This Bill does not give us equality of sacrifice. This Bill is going to make the economic situation worse by its restriction of our biggest market, the home market, and by reducing the purchasing power of large numbers of people. It will give us a procedure under which very far-reaching changes will be made in old-established practices in this country and in the actual law of the land without the Government having to come to the House either to present a Bill or even to take the trouble to get Parliamentary approval before they take any particular action. On those grounds, the Bill ought to be rejected, and many hon. Members opposite, as they analyse the implications of the Bill, will go into the Lobby to-night with very heavy hearts and troubled consciences.

This Bill may be the price which has to be paid to those who control society to-day. Noble efforts were made by right hon. Gentlemen opposite to do their best, in the circumstances, but it appears inevitable that in those circumstances this is the price that the country has to pay to be rescued from the difficulties of the immediate crisis. But a sense of injustice is growing in the country as a consequence of this being the one method by which you must deal with the situation, and while the forces of private and vested interests, which are so clamorously behind the Government to-day, have had their victory—[Interruption.] Let me say this in all seriousness, and I do not want to be provocative about it; I am saying what is in my heart. While there may have been an immediate victory for existing economic and financial forces, I believe that this Bill and the subsequent actions of this Government will strengthen a movement, which will gain enormously in new adherents, for superseding an order, which puts the lives of the people in the hands of a few, by some sort of society on a rational basis where equality of sacrifice means equality of sacrifice, and where no small class of people will be able to rule the destinies of a nation.

The SECRETARY of STATE for the HOME DEPARTMENT (Sir Herbert Samuel)

rose—

Mr. GEORGE HARDIE

On a point of Order. In view of the fact that today's proceedings are so intensely interesting that many Members desire to take part, is it possible for Members to impose on themselves a time limit for their speeches? If so, I am prepared to put forward a Motion, which I think will be acceptable, in order that all those who desire to speak will have an opportunity.

Mr. SPEAKER

I am afraid that that s not a matter that I can decide.

Mr. HARDIE

That is the difficulty I am trying to get over. Is it competent for the House to impose on itself a time limit by carrying a Motion?

Mr. SPEAKER

We cannot decide this by a Motion. Any limit of that kind would have to be self-imposed, and I hope that it will be.

Sir H. SAMUEL

No one would welcome a limitation of that kind more than the Member who has been called upon to address the House, because it has never been my custom to trespass more than need be on the attention of the House, and I can assure hon. Members that I shall address them to-day with such conciseness as the theme allows. I shall be obliged in the course of my observations to take up some of the points made by the right hon. Gentleman who has just spoken as to what passed prior to the formation of the present Government, and to state fully and frankly what proposals were in fact placed before the representatives of the other parties when they met the Prime Minister and the Chancellor of the Exchequer, and how far they were provisional or definite. First, however, I desire to follow the right hon. Gentleman in some of the wider issues that are raised by this Bill and in this Debate. He spoke a true word when he said that many of us who will go into the Lobby to-night in support of this Bill will do so with heavy hearts. Unquestionably, it is a grave matter to pass a Measure which will impose a serious check upon the whole movement for social reform and for national development, in which this House and the country have been engaged for many a long year past—a work in which in varying degrees all parties have taken a hand.

The great development of national education in the course of the last half century; the improvement of measures for public health; the great development in national housing; the establishment by the Government of which some of us were members 20 years ago of our great system of old age pensions, national health insurance and unemployment insurance; the extensions of those services that took place after the War; the contribution of the Conservative Government by the creation of widows' and orphans' pensions, involving a capital liability upon the State of no less than £746,000,000—all these measures were designed to do something to help our society to rid itself of some of the grave and obvious evils that, unquestionably attach to it. There is injustice in our social system and there is this contrast between great wealth and grinding poverty, and, unless our politics have no moral or rational basis at all, there is a clear duty upon society to help to reform these conditions; and not only a moral duty: quite secondarily, there is this undoubted fact, that there can be no real stability in our social system, and no security for our system of finance or anything else, unless they rest ultimately upon a contented population. Therefore, it is a grave matter for this House to pass a Measure which in some degree checks or even reverses these tendencies of social reform.

Those of us who represent the Liberal party and Liberal principles and ideas feel a profound regret that our policy of national development on which our hearts were set is necessarily subjected to some check. We have been impressed, and the whole country has been impressed, by the fact that since the War £600,000,000 has been spent on unemployment relief with nothing to show for it in the way of equipment for the nation or improvement in its resources. We have been urging constantly upon the House and upon the country that we ought, by a policy of investment and not sheer deadweight expenditure, to endeavour to give employment and at the same time to increase our resources. This Bill in some degree puts a check upon that policy. I profoundly regret, although many hon. Members on this side do not share that regret, that it has been found necessary to stop to some extent the development of the road programme. The Royal Commission on Transport declared that, although the arterial road programme was approaching an end, there was an immense scope and need for work upon other parts of our road system. I regret very greatly that measures for fostering agriculture and for the rapid improvement of housing have to be slowed down under these proposals. Therefore, as the right hon. Gentleman says, it will he with a heavy heart that we support these measures.

I agree with him when he says that the consequence must be to some extent to add to existing unemployment. It will diminish the purchasing power of those classes who are unemployed and of other classes. We must face the fact with our eyes open that the withdrawal from the country of this vast sum in taxation must mean a shrinkage of an effective demand for commodities, and consequently some decline in employment. But these are the consequences ultimately of the failure of the country as a whole to carry on to the same extent as hitherto its international trade. We have failed to sell our goods—our cotton goods in India, our woollen goods elsewhere, and our coal on the Continent. Our trade has shrunk, the whole nation is poorer—[HON. MEMBERS: "Oh!"] These are very elementary facts. The whole nation is poorer. Our export trade has declined by hundreds of millions, the revenue is declining in consequence, and we are compelled through these measures to carry forward that impoverishment to large sections of the whole nation. Undoubtedly, by diminishing unemployment allowances, by increasing taxation, by reducing the wages of the police or of the teachers, you are lessening effective demand and diminishing the call for goods.

Mr. THORNE

You are on the wrong side of the House.

Sir H. SAMUEL

If we took the opposite course and increased these allowances, increased the pay of teachers and the police, and added to the wages of our working classes generally, if we doubled the rates of wages, undoubtedly effective demand would be enormously increased. If we could multiply them tenfold, similarly that demand would be increased tenfold. But why do we not do that? For the simple reason that the resources are not there to enable it to be done. We are under the hard compulsion of financial and economic necessity, owing to the lack of resources in the nation as a whole, to carry through the measures which we find to be necessary in these circumstances. Of that necessity we are absolutely convinced. It is for that reason, and that reason alone, that many of us who for 40 years have taken an active part in the work of social reform, and many of us who in recent years have been pressing most strongly for national development; many of those who, like the Prime Minister and the Chancellor of the Exchequer, have given their whole lives to these causes, now find themselves by the action of our own hands compelled to injure the very causes in which we most passionately believe. The right hon. Gentleman said that we should go into the Lobby with heavy hearts and uneasy consciences. With heavy hearts, yes; but with uneasy consciences, no, because we see that there is no alternative.

I do not propose to go into the particular items dealt with by the Bill, but as the Minister responsible for one of the cuts in pay I must say a few words upon that. I refer to the diminution in the pay and salaries of the police. I am sure that this is deeply regretted by the whole House—deeply regretted. All of us highly esteem the work of the police, and are grateful for it; and I, for one, deplore, also, that this step has had to be taken without the opportunity of previous consultation with the authorised body representing the police forces and the police authorities. The May Committee were compelled by the necessities of the time to report in a very short period. They had to cover the whole range of national expenditure, and it was not possible for them to hear the representatives of all the different sections with which they were dealing, and to proceed in the normal way of a State inquiry.

Since their report was published I have had the opportunity of conferring with the Police Council on two occasions, and as a result we have made considerable modifications in the application of the recommendations of the May Committee, in particular in regard to pensions. Police pensions are on a different basis from those of teachers, or of the Army and Navy. If the report of the May Committee had been carried out literally and without change, the effect would have been that this emergency cut in pay would have been carried immediately into the pensions rates, and that while a man who had retired from the police force last year after 20 or 25 years' service would receive for the rest of his life his full pension, a man who retired next year, after exactly similar service, would find that his pension all through his later life would be diminished by 2s. 6d. in the £. That was an inequality which we could not accept, and consequently we have made it clear that these pensions will not be affected by the measures we propose.

Further, the cut in pay is to be carried out in two instalments. We have not come to any definite conclusion as to the manner in which the second instalment next year shall be enforced. That is left for consideration and for consultation, although it is only right to mention that the Chancellor of the Exchequer is relying in his next year's Budget upon saving a sum not less than that which was recommended by the May Committee. The general arrangement of the reductions from pay and salaries has been agreed by the Police Council. Naturally, they demurred to the fact that any cut should be made at all, but if the cut had to be made they preferred that it should take the form which is now embodied in the White Paper rather than that which was recommended by the May Committee. A further recommendation of the May Committee was that police constables and others should be retained in the service until the age of 50—retained even against their will. That would have brought some slight financial relief, but a very small relief, and we are of opinion that that recommendation should be carried into effect, only after very careful consideration, and not as part of the special emergency arrangements which are being made now in order to meet the pressing financial necessities of the State.

It should be remembered with regard to the police that while they have had considerable increases of pay since the War, it is also fully recognised that their pay previously had been very inadequate. But one of the reasons for some part of that increase was that the cost of living had very greatly increased; it was not the main, not the sole reason, but one element among others; and it should be remembered that while the Civil Service has had to subject itself to very considerable diminutions of pay in accordance with the fall in the cost of living the police have not yet had any such comparable reductions. That is the reason, or one reason among others, why it has been thought right to accept the May Committee's recommendations with regard to the police. I must apologise for having detained the House so long on this matter, but as the Departmental Minister responsible it was necessary for me to give some explanation to hon[...] Members.

To return to the Bill itself. The right hon. Gentleman has complained of its form, saying that it tends to proceed by the drastic method of Orders-in-Council instead of by making full and detailed legislative provisions. The right hon. Gentleman my predecessor at the Home Office, who moved the rejection of the Bill on Second Reading, said in the first place that such a step was indefensible, and in the second place that he himself would not hesitate to adopt it. Undoubtedly it is a drastic Measure, which could only be justified in a case of the gravest national importance, where an emergency was sudden and where delay would bring disaster. In such circumstances, it is necessary that a representative assembly like this should be prepared to adopt whatever measures the occasion requires in order to keep a grip of the situation. Much has been said in the last few months about a decline in the, prestige of Parliament. I myself do not believe that there has been any very great substance or justification for those criticisms, but I do feel that if a democratic assembly proved itself unequal to the emergencies of a sudden situation, and was not prepared to adapt its own procedure to the necessities that arose, then, indeed, its prestige would suffer heavily in the eyes of the country.

Just as an army knows that it needs generalship, so a democracy knows full well that it needs leadership, and I do not think that anything in recent weeks has met with more complete popular approval than the formation of a small Cabinet and the swiftness of its action. Nothing would be more profoundly disapproved than to see Parliament engaging in weeks and months of debate while the financial and economic position of the nation deteriorated week by week and month by month. All successful democracies have been ready in a time of emergency to curtail their own liberties, and even the powers of their representative assemblies. Long ago a Cabinet of 10 was set up—in order to save the Roman State. We are told by the historians that the Decemvirs of that day discharged the duties of their office with diligence and dispensed justice with impartiality. But they made the great mistake of continuing too long, and in their second year they came too much under the influence of the Patricians; they aroused the anger of the Plebs, and they disappeared amid universal disapproval. I hope that the Decemvirs of to-day will not make that mistake.

So far, at all events, it will be conceded that we have acted with rapidity. It is only three weeks to-day since the late Government resigned, and in those three weeks a new Government has been formed, its composition has been completed, its Measures have been framed, Parliament has been brought together, and the full proposals of the Government, complete in all their details, have been presented to the House. That rapidity has been made possible by two facts. One is the preliminary work of the May Committee. Necessarily that had to be somewhat rough and ready, and on some points it needs revision, but I think a tribute should be paid in this House to the work which was accomplished by that Committee, most unpalatable work as it must have been. By their investigations and their report they have rendered great service to the State.

The other factor which has greatly facilitated the work of the Government is the preparatory work accomplished by their predecessors. [Interruption.] No, their immediate predecessors. With regard to that, it is essential that the facts should be fully known to the House, and to the nation. It has given rise, and it will give rise, to considerable controversy, both now and in the future, and it is desirable that as one of those who took part in the discussions at Downing Street I should say what the position was as it was declared by the representatives of the Government to the representatives of the other parties. I make this statement with the full assent of the Prime Minister. It is quite proper that this statement should be made, for we were there, not as individuals engaged in some private negotiations with a view to arriving at an understanding as to our personal actions, but we were there representing large sections of the population, comprising, taken together, the great majority of the electorate and a substantial majority of the House of Commons. Further, it should be remembered that the May Committee, out of whose report these recommendations have arisen, was not appointed on the initiative of the late Government but on the initiative of the House of Commons itself, and all parties in the House.

Mr. BUCHANAN

Not all parties.

Sir H. SAMUEL

There were 21 votes against it—those of the hon. Member for Gorbals (Mr. Buchanan) and those associated with him. They, at all events, can claim that having gone into the Division Lobby against that inquiry they are absolved from responsibility for its recommendations; but the other 590 Members of the House can make no such claim, and, therefore, they cannot dissociate themselves from the responsibility. And not only that: the late Government were entitled to say that a task so unpopular and so unpalatable as that of effecting great economies of this nature could not be carried out by any one party alone, and they were entitled to ask and to know what would be the attitude of the other two parties in the House of Commons if these proposals were made. They were entitled to know that if they undertook what was really a national duty in a bold spirit their political opponents would not seize the opportunity to make party capital out of the position, to leave them with the responsibility for the proposals they had made, and to denounce them in Parliament and the constituencies for having made harsh and avoidable attacks upon the standard of life of the people. I think right hon. Gentlemen opposite were entitled to ask for an assurance that they would not be made the object of the precise political tactics in which they themselves are now indulging. These assurances were given, and, although those who spoke for the parties in those conferences could not give a definite pledge until the parties had met and arrived at their own decision, we could say what advice would be given by all the leaders of those parties, and we gave an assurance that in our opinion that advice would be followed. [An HON. MEMBER: "That is what we wanted, and we did not get it!"

Let me give my account of the events that took place as to which, for the sake of greater accuracy, as Mr. Speaker says at the beginning of each Session, I have in my hands the notes which I made at Downing Street in the course of those conversations. On Thursday, 20th August, in the morning, we were summoned to meet the Prime Minister and the Chancellor of the Exchequer, and we were informed, for the first time, of the appalling extent of the deficit for this year and next year, of which the House is now cognisant. We were told that the Cabinet Committee had met and had prepared certain proposals which it was intended to lay before the Cabinet, but they had not then been considered by the Cabinet. Those proposals included a total of economies amounting to £78,500,000. Of that sum £50,000,000 was in relation to Unemployment, but it must be understood that these were only tentative proposals suggested for consideration, and that they included no cuts in the standard rates of unemployment allowances. The £50,000,000 included a sum of £10,000,000 which represented increases in the premiums of insurance paid by the employers and employed. Therefore, they were not properly to be regarded as savings. I will not trouble to give all the details, because they were regarded as provisional, and not the definite proposals of the Government. The conference adjourned to allow us to give these matters consideration. We had consultations with our political friends and the Conservative party representatives had similar consultations, and we were all of opinion that those proposals represented a very bold scheme, and a, courageous attempt to grapple with the realities of the situation, but we doubted whether such a large sum of savings could be effected with regard to unemployment without a diminution in the scale of unemployment allowances, and we determined to raise this point at the next conference. We were prepared to give a general assurance of support if measures of that kind were laid before Parliament.

On Friday, 21st August, the Cabinet sat in the morning and the afternoon, and we had no communications with the Government until we returned to Downing Street in the evening at five o'clock. The Prime Minister and the Chancellor of the Exchequer were there and they received the President of the Board of Education and myself representing the Liberal party and the present Minister of Health and the Secretary of State for India representing the Conservative party. [An HON. MEMBER: "What about us?"] The Prime Minister and the Chancellor of the Exchequer were there, and we were invited to be present with the full knowledge and approval of the Cabinet. Before any statement of our views was made on that occasion the Prime Minister and the Chancellor of the Exchequer told us that the plans which had been stated in general terms on the previous day had been modified by the Cabinet, and that they had accepted the whole of those proposals, except those relating to unemployment. The savings they suggested in regard to unemployment expenditure to relieve the Budget, instead of being £50,000,000 were reduced to £22,000,000. Those were the proposals after they came back from the Cabinet. Of that £22,000,000, £14,000,000 was really additional taxation. There was to be a contribution of £10,000,000 from employers and employed. There was also to be a 2d. levy from those working. That was to be like an ordinary trades union levy raised in special circumstances and it was expected to yield £4,000,000. That means that £14,000,000 should be deducted from the £22,000,000, and that would leave £8,000,000 of real savings. Of that sum, £3,000,000 had already been decided upon under the Anomalies Bill passed by Parliament. The new savings on unemployment would amount only to £5,000,000 and these were to be obtained by imposing a needs test for transitional benefit. [Interruption.] The total charge for unemployment that would have fallen upon the Exchequer, apart from contributions by employers and employed, if no changes were made was estimated to be £119,000,000, and the new savings to be effected by the Government's proposal amounted to £5,000,000.

There were other savings which the Government were prepared to approve if there was general agreement upon the unemployment question. With regard to education, the Government had considered the majority recommendation of the May Report of 20 per cent. and the minority recommendation of 12½ per cent., but a figure of 15 per cent. was accepted and was estimated to produce a saving of £10,700,000. There was to be a saving of £7,800,000 on roads, and £9,000,000 on Defence Services—

Mr. A. V. ALEXANDER

Do I understand that the £10,700,000 which the right hon. Gentleman now mentions was communicated to him by representatives of the Government as having been the decision of the Cabinet?

Sir H. SAMUEL

Yes, Sir, that was included in the list of those cuts which the Government said they were prepared to undertake.

Mr. ALEXANDER

I wish to deny categorically that any such proposal was ever proposed.

Mr. SHINIWELL

As the Prime Minister apparently is the vehicle of communication on this issue, would it not be wise to have the right hon. Gentleman present in the House?

Sir H. SAMUEL

The Chancellor of the Exchequer confirms that figure. Perhaps my statement in the form I made it may have led to some misunderstanding. There was a cut suggested for education economies estimated to yield £10,700,000 and the teachers' salaries were to be cut by 15 per cent. The figure for education included some other education economies besides the cut in the teachers' salaries, and they appear in the White Paper. There was to be savings on the Defence Services of £9,000,000. [HON. MEMBERS: "No!"] The Chancellor of the Exchequer says that my figures are correct.

Mr. MACLEAN

As statements are now being made about discussions that are taking place at Cabinet meetings—[HON. MEMBERS: "No!"]—and figures are being submitted which are alleged to have been agreed upon at Cabinet meetings, is it not the right of Members of this House to ask for the Papers so that hon. Members may judge whether those statements are correct?

Mr. SPEAKER

With regard to the hon. Member's second question the same point was raised the other day. I understand that there are no Papers.

Mr. LANSBURY

We are now in the position that it has been stated that Cabinet conversations and Cabinet conclusions, which are not majority or minority conclusions, have been communicated to certain other people. All I want to do now is to peg out my claim to be able to state what I consider took place in the Cabinet. I can understand the right hon. Gentleman the Member for Darwen (Sir H. Samuel) telling us what he has told us, but he has no right to stand up and attempt to tell us what were the views of the Cabinet.

An HON. MEMBER

He has not done so!

Sir H. SAMUEL

I am simply relating to the House what was said to me.

An HON. MEMBER

Who said it?

Mr. MACLEAN

I am not imputing any falsity of statement to the right hon. Gentleman. I want hon. Members to be in a position to know what were the actual figures which the Cabinet arrived at. Was there any difference in the figures conveyed to the right hon. Gentleman the Member for Darwen and those put before the Cabinet?

Sir H. SAMUEL

The savings on education were to be £10,700,000, Roads £7,800,000, Defence Services £9,000,000, Police £500,000 in the first year and £1,000,000 in the second year; Forestry, £500.000; Unemployment Grants, £500,000; Agriculture,£700,000; Health and Doctors, £700,000, and other possible economies £1,000,000.

Mr. GREENWOOD

There must be some misapprehension. Can the Chancellor of the Exchequer tell me of any occasion when I ever accepted that figure?

5.0. p.m.

Mr. P. SNOWDEN

There were certain definite economies under the Ministry of Health Vote which were accepted by the right hon. Gentleman. There was an additional sum, but it was to be left to the Department to arrange how that additional sum should be arrived at, and it is quite true that the right hon. Gentleman never committed himself, beyond £750,000, to any definite item of economy; but he did take the reference from the Cabinet to try to find other economies.

HON. MEMBERS

Ah!

Sir H. SAMUEL

What I said was that the economies with regard to the Ministry of Health were:Doctors, £700,000; other economies, possibly £1,000,000, but that matter had to be further investigated. That is exactly what I said. Then there were: Empire Marketing Board, £250,000; Colonial Development Fund, £250,000; Miscellaneous, £2,500,000, the total being £56,375,000. Of that sum, £14,000,000, as I have said, was really increased contributions from employers and employed.

Mr. McLAREN

Is there anything about beet-sugar? [Interruption.] I want to ask the right hon. Gentleman if at that juncture any suggestion was made as to economies on the Beet-Sugar Subsidy?

Sir H. SAMUEL

As the hon. Member knows, there is a commitment there—[Interruption.]

Mr. G. HARDIE

What about the soldiers and sailors? [Interruption.]

Mr. SPEAKER

This is an important matter that we are discussing, and we cannot discuss it in that manner.

Sir H. SAMUEL

The outcome was that, out of a total deficit for next year of £170,000,000, the Government proposed economies in expenditure amounting to £42,000,000. That was excluding extra contributions with regard to unemployment expenditure. Out of an estimate of £119,000,000, there was to be a new saving of £5,000,000. After that communication had been made to us—

Mr. GREENWOOD

What date was that?

Sir H. SAMUEL

This was after the meeting of the Cabinet on the Friday. We consulted our political friends and colleagues, and we came very clearly to the conclusion that these proposals were not adequate—[Interruption]—and that in our view they would be unlikely to be approved by Parliament. We took the responsibility of saying so to the Prime Minister, whom we saw late that evening. On the Saturday morning the Cabinet met again, and at 12.30 we were invited to return to Downing Street, when we were informed by the Prime Minister that the Cabinet had been unable to modify its proposals. We were also told about some divisions of opinion in the Cabinet with regard to unemployment insurance, but it is not for me to speak about those; they have been mentioned in the "Daily Herald" in full detail, with the names of the Ministers who took the one view and the other. We were asked, supposing—the contingency was put only as a possibility—supposing that there were agreement as to a reduction in the unemployment allowances of 10 per cent., which was then estimated to yield £12,250,000, what view would be taken of that, which would bring the total of relief to the Budget up to £68,500,000. We said that in our opinion those proposals might be considered to be adequate. We did not say that they were really sufficient, but we did not say, as we had said before, that Parliament in our view would reject them. We could not express an opinion as to whether those proposals would be sufficient to restore world confidence, and whether the purpose of them would be served or not; if it was found that it would not be served, they would have to be reconsidered; but we had no reason to think, so far as we were concerned—[Interruption]—that they would be regarded generally as inadequate; and as a matter of fact the proposals of the present Government, amounting to practically the same figure—just over £70,000,000—have been acclaimed universally as a very great effort to ensure national solvency and stability. The conclusions that may be drawn from this statement are these—that, except in the section relating to unemployment, the items in the White Paper that we have produced are, with very small detailed differences, item for item exactly the items that were communicated to us on that day as having been regarded by the Cabinet as proper economies, if economies had to be made at all on those lines; and the conclusion which the House may draw is that, if right hon. Gentlemen opposite had remained in office, and if they had had the responsibility for dealing with the situation and if all their complete proposals had been accepted with regard to unemployment benefit, direct taxation, and so forth, this is the very list of economies which they themselves would have proposed. [Interruption.] The late Minister of Education will not deny that, if he had remained in office, and if the proposals of the Cabinet with regard to direct taxation and unemployment benefit had been accepted, he would have found himself under the obligation to ask the teachers to suffer a diminution of salary of that amount.

Mr. LEES-SMITH

If I had remained in office, and if the scheme ultimately put forward had included a cut in regard to the Sinking Fund, and had included the special Income Tax, which was going to hit teachers particularly, I should certainly have gone back to the Cabinet and asked for a further reduction.

Sir H. SAMUEL

The right hon. Gentleman did not demur, as I under- stand, to the Prime Minister and the Chancellor of the Exchequer being authorised to communicate to others that this was among the list of economies which the Cabinet would be prepared to submit. [Interruption.]

Mr. JOHNSTON

Statements are now being made with reference to views held and action taken by my right hon. Friend the late Minister of Education. I desire to ask some right hon. Gentleman who was present at the Cabinet discussions whether it is not the case that my right hon. Friend vigorously protested against the proposals that were put?

Mr. P. SNOWDEN

I should like the House to know that all this disclosure of what took place in the Cabinet originated, not with us—[Interruption]. As to what took place in regard to the suggestion as to the teachers' salaries, the position is this: First of all, the Cabinet decided to call upon the Minister of Education to make a cut of 20 per cent.—[Interruption]—and next, day, I think it was, the Minister came back and said that he really could not do that, that it was a too drastic cut; and he will remember that I was one of the first members of the Cabinet to sympathise with the statement that he had just made. That he will not deny, and his neighbour confirms it. Then the Cabinet decided to reduce it to 15 per cent.

Mr. LEES-SMITH

The point is this, that the Cabinet decisions on these points were subject to certain governing decisions with regard to the other methods of raising the money required, and we were told that any reduction in the Sinking Fund was absolutely impracticable. The Chancellor of the Exchequer will not deny that statement. If I had known, if the Cabinet had known, if the Cabinet had been told at any moment, that there were to be reductions in the Sinking Fund, setting free further sums of money, that decision would certainly have been reviewed by the Cabinet.

Mr. SNOWDEN

There was no relation whatever between the discussion of the question of the possible postponement of certain Sinking Fund payments and of these cuts. May I just add this? The right hon. Gentleman the Member for Burnley (Mr. A. Henderson) said that the late Cabinet had agreed pro- visionally to £56,500,000 of reductions and economies. Therefore, if right hon. Gentlemen sitting there challenge the figure of any particular item, then they must deal with some of the other items. As a matter of fact, the right hon. Gentleman the Member for Bow and Bromley (Mr. Lansbury), who has just left the House, interposed a few moments ago about a statement I made to the Labour party Executive and the Trade Union Congress Committee a day before the meeting took place to which my right hon. Friend is now referring. I do not think I gave them the exact figures in every case, but I gave them every one of those cuts, without the slightest protest from the right hon. Gentleman the Member for Burnley, who was sitting within a yard of me. [Interruption.]

Miss LAWRENCE

I desire to ask the Chancellor of the Exchequer whether at that meeting he did not most expressly and clearly tell us that those were matters which were under consideration, and gave us to understand that no decision of any kind had been reached?

Mr. SNOWDEN

It is true that I gave these as platters that had been under the consideration of the Cabinet and, to use the words of the right hon. Gentleman the Member for Burnley, had been provisionally agreed upon. I should never, with the concurrence of my colleagues in the Cabinet, have made those disclosures to the meeting if I had not had the approval of the Cabinet. I understood that to be a private meeting, but I gather from what the right hon. Gentleman said in his inaugural address to the House, and from what was repeated by the Secretary to the Trade Union Congress at the conference last week, that at that private meeting they had hidden, I suppose, under the table some shorthand writer who took a verbatim note.

Sir H. SAMUEL

rose. [Interruption.]

Mr. DEPUTY-SPEAKER (Sir Dennis Herbert)

I must ask hon. Members on both sides, as indulgence has been granted to those who wanted to correct and make interjections, that they must now give equal indulgence to the Home Secretary.

Sir H. SAMUEL

All these various reductions and diminutions of pay and salaries must, of course, have been most distasteful to the Ministers in question, but the fact remains that they were communicated as being the decision as to what the Cabinet would be ready to do in certain circumstances, and the dilemma in which right hon. Gentlemen are is that they cannot say now that certain economies are in all circumstances wrong when they said previously that in certain circumstances those economies were right. They are not free to attack in September the economies which they were ready to approve in August. They may run away from their public duty, but they cannot run away from their own selves. They cannot claim to he a patriotic party, determined to balance the Budget and save the value of sterling and, therefore, to be entitled to the confidence of the whole nation, and in the next breath criticise and attack measures of economy when those measures are an indispensable part of a policy necessary for the achievement of those objects.

Mr. DEVLIN

I am quite certain that all of us who are interested in dramatic situations will be tremendously impressed by the scenes that we have just witnessed. I suppose in the long history of this Parliament, or in the long history of this country, there never was a situation equal to this. It is a strange thing to find that the Prime Minister of the Labour party should have behind him all his old enemies and in front of him all his old friends. While I make that comment upon the somewhat extraordinary position which this House occupies today, it would be profoundly wrong of me to attribute anything but the highest motives to the Prime Minister and the Chancellor of the Exchequer. I sat beside both these Gentlemen in this House for nearly 15 years when I was, like themselves, a wanderer in the wilderness of opposition, belonging to a party which was fighting for that freedom and self-government for 40 years which its enemies conceded in the end. We tried in a hostile House and in a hostile nation to arouse sympathy for the dumb masses of the people. I should be sorry indeed to believe, and I do not believe, that to-day the Prime Minister is an apostate to the cause to which he gave such priceless service in the past. I quite recognise that a, sense of public duty has inspired him and the Chancellor of the Exchequer to take up the attitude which they occupy to-day, but every Member of the House is entitled, and I perhaps more than anyone in the House, for I belong to no party, have a right also to say I believe that the Prime Minister and the Chancellor of the Exchequer are profoundly wrong in their attitude.

This is a crisis created by pessimists and croakers. This is the final situation of a dramatic stunt worked up by the Press. This is a crisis created by trying to discredit the honour and the financial power of this nation. I know little about finance, and I am not interested in the controversy from that point of view, but I know, the repercussions of these Press productions piercing into every country of Europe and into America, the conclusion arrived at long ago before this sudden discovery took place was that this whole thing was worked up as part of a political propaganda to discredit a Government which was a minority Government, which was struggling against the fact that it was a minority Government, that it was practically the first Labour Government that ever held office—the other merely existed for a few months—the first Labour Government that had a chance of doing things. I say, as an impartial observer of these affairs, that the situation in which we find ourselves to-day is one created for the meanest of political motives. This is a crisis caused by the pessimists, and in this respect I should rightly say that never was there a situation which so justified the description which I have heard of a pessimist, that he is a person who has the choice of two evils and chooses them both.

We have heard a great deal to-day about what the Labour Government agreed to and what they did not agree to. I have merely risen for the purpose of making my protest against the reduction in the unemployment grant. It was inevitable that there should be cuts. If we were told that the nation was on the verge of bankruptcy, of course, sacrifices had to he made. Everyone, I suppose, on every side was prepared to make sacrifices. I do not want to repeat the comments made from different sides of the House as to what is precisely the character of the sacrifice which each person should make, but, if there is one section of the people who should not have been called upon to snake a sacrifice, it was the unemployed. Since everyone is ask- ing everyone else questions and trying to get answers, may I ask this question? Do I understand that, if it is true—I do not know whether it is or not—that the late Minister agreed to all these cuts except one, and that was a cut of £12,000,000 on the unemployment grants, you are prepared to create this national crisis, that you are prepared to have this country's name bandied about throughout the whole world and throughout the United States because you insisted that, before you would have a National Government, you were to save £12,000,000 out of the fund that was to pay the unemployed? I put this question as one who is interested vitally in this question of unemployment. Did the British Empire for its future existence, did the financial status of this country, did the desire to keep this country from bankruptcy—because that is what this crisis means—depend entirely on conceding £12,500,000 and robbing the poor? I saw in some publication the other day that God was fond of the poor for He created so many of them. I should like to know if that is the position taken up on the other side.

I speak again as an outsider. If those right hon. Gentlemen who belonged to the late Government agreed to all these concessions which they say they did—reduction of teachers' salaries, retrenchment upon roads, reduction of police wages, curtailment of the health services, reduction in education—that was a tremendous sacrifice for them to make. For the purpose of my argument, I find them guilty of the offence that you have charged them with. That is not to their discredit if it is true. It shows how far they were prepared to go to balance the Budget and to safeguard the financial position of the country, and, instead of it being made a cause for violent abuse of them and the reading out of this whole sordid story of what took place, the right hon. Gentleman should have got up at that Box and thanked them that they were prepared to go so far in order to secure the purpose which you say you had to secure. But when it comes to the one thing that could not be justified, the taking away from these poor people of a portion of the wretched grant that they receive for the purpose of keeping them from starvation, they found that they could go on no longer, and that is the position which, I take it, they occupy now.

I am not an Englishman. That is why I have made so few mistakes in politics. I heard a number of prophecies as to the future of this Empire if a cut was not made in the grant to the unemployed. I have listened to too many prophecies in my painful progress through Parliamentary experience. When I first came into this House I heard a Tory statesman, with financial emotion in his voice, declare from that bench on the proposal to give 5s. a week to the old age pensioners—and he declared it in violent language, demonstrated by violent attitudes—that if they spent £35,000,000—five shillings a week!—upon old age pensions England would never be able to stand it. It was just after the war in South Africa. We stood that. The architects of war can never find any money for the structure of peace. Five shillings a week. I remained in this House and I saw the party that cheered him commit themselves to a war which showed that this country which was not, according to him, able to pay 5s. a week to the old age pensioners, was able to spend £7,000,000 a day upon universal un-Christian and inhuman havoc throughout the world.

Again and again you have found this country able to pay vast sums of money for other things. Take the military services. I do not propose to take up the time of the House here, but I have statistics to show that the cost of the Army and of the Navy to-day is almost greater than it was at the time of the War. The number of our sailors are fewer, and the number of our soldiers are fewer. Most of them are now upon the dole. But the official cost of these great Fighting Services is greater than ever before. Yet these Gentlemen come here with a passion which I cannot understand. I can understand the resentment on these benches of Gentlemen who know the people, whose instincts are with the people's feelings, who live among the people and who have sprung from the people. I can understand their resentment in the fight they are making to see that the plague of poverty, described here by the right hon. Gentleman a few moments ago, does not once more infest the homes of the common people. I can understand that. But what is your grievance? What is the meaning of your passion? You would have been all right. I think that it is rather a dangerous thing for leaders of the people to demonstrate the temper which I have seen on these benches, or on any benches, because as far as I can see—I do not know this country very well, but I know it to this extent—it will be the function of all lovers of their native land to temper the temper and not to arouse it.

There will be universal resentment among the masses of the people whatever you may say about it. May I congratulate the Government upon their fortunate selection of the right hon. Gentleman the Home Secretary for the function he has discharged to-day? Whatever you may say about it, not only are the poor to bear the cuts, but the poor are to bear the taxes. They will pay the duty upon tobacco; they will pay the duty upon beer, and they will pay a portion of the Income Tax. I count some of the lowly-rated Income Tax payers amongst them, and not only do I count them amongst them, but they occupy, many of them, the most tragic position of all. Take every additional tax imposed by this Budget; it is the common people who will have to pay it in one way or another. Then there are the rents in this country. After all, I represent a constituency very much like a great industrial constituency in England and I know the proportion—

Mr. ROSS

The hon. Gentleman does not represent an industrial constituency. [Interruption.] As one of the hon. Gentleman's constituents, I was only contending that Fermanagh and Tyrone is not an industrial constituency.

Mr. DEVLIN

I represent Belfast in the Northern Parliament. [An HON. MEMBER: "Not here!"] I represent Fermanagh and Tyrone, not because it is an industrial constituency, but because I have to come here to circumvent the influence of stupidity. I know full well what a large part Irish stability has played in the councils of this nation in the past.

Mr. ROSS

You ought to know.

Mr. DEVLIN

I know that for 25 years I tried to argue that Ireland was fit to govern herself, but there was a representation sent over from that country to say that we were not able to do so. Yet it is somewhat strange that when I meet these gentlemen now in private I hear of converts to our ideals. How is it that the only place in Europe that pays its way and is well governed is the Free State? Those who were the Gods of Israel an the old days are prophets of evil and bankruptcy now. I not only retain my faith in freedom, but I believe in humanity. Any sacrifice ought to be made, and no sacrifice ought to be too great, to avoid the rousing of a feeling of resentment and of bitterness, and even perhaps of propagating the ideas of revolution among people like the English, who are stolid, difficult to move, not as resentful sometimes as they ought to be against wrong, little knowing the flair of divine discontent which has roused so many people against wrongs which they have done. Do not create a definite temper or spirit among that people, or you will be engaged in a dangerous pursuit.

Therefore, as far as I am concerned, I do not enter into the merits of this Budget. I am concerned with some of the cuts that are made, hut not too much concerned. What I am concerned with is the position of the poorest and most defenceless of the people. I am on far more human and unselfish grounds. When politicians feel there is no gratitude in politics, when you are deserted and betrayed, when people turn their backs upon you—it has been my experience for 30 years—the poor are always faithful. We should be false to our trust and false to the spirit if we turned our backs upon the people, and I hope that it is not too late yet for this Government to stop the spirit of discontent, which will grow, and this natural resentment by telling them that they will not continue with these cuts, but will leave the unemployment allowance as it is, and will depend for the future greatness and financial stability of England, not upon robbing the poor, but upon applying themselves to some great structural work that will make for national prosperity and strength.

For what purpose was this National Government formed? It did not require all the genius of England to draft a programme such as is presented to us. Anybody could have done that. With all respect to my hon. Friend opposite, I could have done it. I could have taken up the salaries, the wages, and the grants, and I could have got a shorthand writer and said: "We will cut down this, cut down that, and cut down the other thing." There was no need for passion, temper, a change of Government, or loss of party, or disappearance of prestige or a national crisis, or a universal, worldwide drastic situation. There was not any need for that at all. What a National Government ought to be, and what might have been in this country, and what all would have supported, was a Government, not to do what any clerk in an office could do, but to set itself to the task which has been neglected here by the men on whom responsibility has been placed all these years, to try to fashion out a means by which the future greatness of this country could be built up, meeting the economic and industrial difficulties by the application of experience and of brains, if these things are to be applied. That was the work which a National Government could have done, and that is the work which will have to be done yet.

I was told—I may have been wrongly informed—that the Leader of the Opposition was willing to agree to a tariff revenue to provide the amount which was to be given to the Unemployment Fund to meet the situation. But we were told that some Members of the present Government would not have Tariff Reform. But what are we going to have now? We are going to have both. We are going to have the cuts; we are going to have Protection. [An HON. MEMBER: "No, we are not."] Does the right hon. Gentleman the Home Secretary think that I am exaggerating the situation? Does he not know that if these gentlemen do not get back to power, the Tory party will get back. Does he not know that if the Tory party get back to power, we shall have Tariff Reform? Why then not leave the cuts alone until you have the product of Tariff Reform; until you have all the financial advantages which Tariff Reform will bring? That would be the proper policy. For my part—and I end as I began—although I do not question the motives of the right hon. Gentleman the Prime Minister, or of the Chancellor of the Exchequer, I believe that their attitude was a panic attitude, and the worst form of hysteria is panic patriotism. I believe, too, that one of the causes of it was a sort of feeling of inferiority complex. I am afraid that I cannot exempt the late Government altogether from that charge. Democracy is always afraid of itself. I hope the Home Secretary will not rob me of the privilege of offering one sentence, in my humble way, against his dissertation upon democracy, and what the fruits of it will be to the Liberal party if they remain where they are. Democracy is always afraid of itself, and I feel that in this case the Prime Minister and the Chancellor of the Exchequer were afraid that people would say that they were not fit to face the situation. They are not lacking in courage, for I know the courageous stand they made in times when courage was needed. Sometimes even the strongest people weaken at a critical stage.

I hope that the House in this matter will act in the spirit in which the common people want them to act. It is the common people for whom we are here to fight. The rich have always plenty of advocates and friends. It is for the common people that I plead, and I say to the Home Secretary that, with his Liberal influence in the Cabinet, he would serve best those priceless and glorious principles, which have been planted upon the banner of Liberalism during 40 or 50 years, and which he rightly said, in conjunction with those who represented Ireland, carried so many of the great social reforms that have enriched the lives of the working classes and led them along the paths of freedom if he said to the House, "We will remove these cuts, and we will not allow the common people to make this sacrifice that has been demanded of them."

Mr. MACPHERSON

I have listened with very great interest to the eloquent speech of my hon. Friend the Member for Tyrone and Fermanagh (Mr. Devlin). Like many others in this House, I have had the privilege of listening to him on many occasions in the past. Those of us who heard him then, are delighted to find that he has still his pristine vigour, his eloquence, his dexterity of argument and his sincerity. If I may so say with the greatest respect, and I have listened to every speech that has been delivered from both sides, I have not heard any speech so well delivered against the Bill. I am not surprised that the Prime Minister hated the task which he had to perform on Friday. This Bill is drastic and illiberal, and its only justification is the existence of an emergency and a crisis. I cannot think that any Liberals at any other time could possibly be found in support of such a Bill. It is the new despotism with a vengeance. I cannot help thinking that in a very short time the Lord Chief Justice of England will require another addition to his book. I have, as sincerely as I could, attempted to gauge the situation, and I am satisfied that there was a crisis, and that there is a crisis. Where there is a desperate disease, there is the necessity of desperate remedies being required.

This Bill causes much hardship and disquietude. I agree with the Home Secretary when he regretted that the great objects of the party to which he and I belong are for the moment to be handicapped. There is hardship in a great many cases. There is hardship in the case of the unemployed, to which the hon. Member for Tyrone and Fermanagh referred. I propose to deal with the severe hardship in another quarter. I refer to the reduction of 15 per cent. in the pay of the teachers. This Bill is drastic and allows of no Amendment. The teachers, so far as I can understand their case, have had no opportunity before the May Committee or anywhere else of stating their views or putting their case. If I do not support the Bill because of the drastic cut of 15 per cent. in the pay of the teachers, I am told that I am opposed to economy. It is a difficult position in which one finds oneself.

I receive a great many letters from teachers all over the country. I have had many letters from Scotland this morning, and not in a single case have I found an objection to their taking part in what is called sacrifice. I know what the life of the dominie is. I owe everything in life to the local teachers. I know the struggle that they have in the rural parts, where they have a position to keep up. The influence which they have to exert, not only in the school but outside it, is enormous. Their real trouble is that they do not wish to appear unpatriotic, because they are not, but they are left with no option except to raise their grievance in this way. Why should they be asked to pay 15 per cent., when the general cut is 10 per cent.? I see the President of the Board of Education present. I should have thought that on a subject of this kind we should have heard him. I congratulate him on his appointment and I know his great interest in economy and in education. I feel sure that the friends of the teachers in this House would be glad to know the real reason why the teachers should be asked to subscribe 15 per cent. when others are only asked to subscribe 10 per cent. They are asked to subscribe it suddenly.

Every married teacher that I know has commitments. He has children to educate. He has insurances to meet. Yet without rhyme or reason he is asked to pay much more than any other individual class. I do not think the position can be better put than in a letter which I received this morning from the secretary of the Educational Institute in Scotland. May I point out that teachers have frequently shown their willingness to bear sacrifices considered necessary for the well-being of the country. They regret that the Government has based its action in this emergency upon the recommendation of the May Committee, which heard no evidence whatever from teachers, and apparently came to its decision on the assumption that the present salaries of teachers contained an element related to cost of living. This is a positive error in fact. The minimum national scales in Scotland were drawn up after close consultation between the authorities and the teachers. In several categories they have not even yet had their normal period of duration. Does anyone deny that that is not a case of unfair treatment? The teachers have a legitimate grievance. If they were asked to pay 10 per cent., then I probably would not be making this speech. They would then say, "We are taking our fair share." The teachers are very often the poorest of the poor, considering the social position that they have to keep up, yet they are being asked to make this sacrifice, when the cost of living has nothing whatever to do with the decision in their case. They are being asked to bear an extra 5 per cent.

I quite agree that the drastic nature of the Bill shows the gravity of the crisis, and that the emergency demanded quick action. This 15 per cent. cut would never have received the sanction of any Government, Labour, Liberal or Conservative, or of anybody else, before it had received meticulous consideration, if the time had been available. Many of us on this side of the House, while prepared to support the Government in the steps which we feel they are bound to take, do strongly suggest that there should be some mitigation of the severity of this cut, especially so far as the lower ranks of the profession are concerned. I was deeply impressed with the vigorous presentation of the case put to the House by the Home Secretary. He explained the sum which was to be obtained, but I am not without hope—I am speaking particularly for the teachers in Scotland—that some method of mitigation may still be found to meet the real difficulty with which the teaching profession is faced. Education is not a question of profit and loss. You cannot set down so much on one side of a book and so much on the other when you are dealing with education. Education is a far bigger thing than a balance in a bank book, and if education is to be the first thing that is to suffer, through the instruments which are bound by Statute to give the education to the children, then it is a bad day for education. In Scotland we regard education as "a noble rage which penury can ne'er repress." The Government must find a way to mitigate the present difficulty in regard to the teachers. If there is to be, and there can be, no Amendment of this Bill, it shows the drastic nature of the new despotism.

Mr. MACLEAN

For which you are going to vote?

6.0 p.m.

Mr. MACPHERSON

I said that I had been convinced that there was a national emergency. Right hon. Gentlemen opposite were convinced that there was a national emergency. They went a long way; and included a cut. Personally, I would never have included a 15 per cent. cut. I would have stuck to the bitter end for a level cut all round, and if my speech means anything it means that there should be no unfair treatment of the teaching profession as opposed to the other professions. With that plea, I must sit down. I have endeavoured to state the case from the teachers' point of view, and if we cannot move an Amendment to this Bill in Committee which I for one should have supported, I hope we may get some guarantee from the Government that this honourable profession, which has its commitments and difficulties and a social position to keep up, will be given a promise that the Government, if not in this Bill by some administrative mitigation, will help them in the present crisis.

Mr. HAYES

My opposition to this Bill is complete, without any reservations of any kind. It is quite a simple matter to be drawn into a controversy in regard to the respective merits of the cuts in the various services covered by the Bill, but let me say that, being interested in one particular branch of the public service, the police, I ask for no relief for the police at the expense of any other public service. If it were a question of any sacrifice on the part of the police being applied for the relief of the unemployed, there would not be any objection, in the normal way, to such a proposal. But that is not the case. We have had the spectacle of Parliament being turned into a laundry, and when the washing is hung out to dry we shall find that the Government linen is still dirty. I join in the common opposition to this Bill.

I want to refer specially to the statement made by the Home Secretary as to the position of the police force. He frankly admitted that he had not been able to avail himself of the normal machinery for consulting with members of the police force in regard to the cuts that are demanded in the May Report. I say "demanded," because when the right hon. Gentleman found that the law had to be observed even by the Home Secretary, he convened a meeting of the Police Council, a body which by law consists of representatives of all shades of public authorities and the police force. The fact that policemen are but one or two as compared with, the very large number of other people is something about which I do not complain, but when the right hon. Gentleman called the Police Council together the spirit in which he approached them was: "This is definite. This is the proposal of the Government; take it or leave it. In any case we are going to apply it." I do not say that he used that phraseology, but that was the spirit behind his approach to the Police Council. They did not agree at any time that they were proposals which they could accept.

We have heard a great deal about the question of contractual obligations. This Bill destroys any faith or confidence which might have been left in the Government of this country carrying out their contractual obligations. Whenever it is a question of employés breaking their contracts in any form, there is no limit to the measure of condemnation that is poured upon them. In the case of the police service there is a long list of obligations which are positively contractual. The moment a man joins the service he has to fill in a form of application, and on the first page he is told quite definitely that all his answers must be of a very definite character; there must be no wobbling about the answers. On the last page of the application there is set forth all the rates of pay he may expect to receive and enjoy as he passes from stage to stage in the service until he reaches his pension days; and an Act of Parliament governs the measure of pension he is to receive. I accept at once the fact that the Government recognise that it is too serious a break of contractual obligations to interfere immediately with pensions, but I should like to know whether that can be taken as an undertaking that at no time, either under the powers of this Bill or by Order-in-Council, will the Government interfere with contractual obligations laid down by Act of Parliament. The right hon. Gentleman may not be able to give that assurance, because Clause 1 of this Bill says: in respect of the remuneration (otherwise than by way of pension assessed before the commencement of this Act) of persons in His Majesty's Service. That carries the implication that it does not apply to assessments made after the commencement of this Bill and unless there is a positive undertaking by the Government on this point, it will be difficult to hold the Government to contractual obligations under previous Acts of Parliament. In regard to the suggestion made by the Home Secretary that there is nothing comparable between the sacrifice made by the police and that made by the Civil Service, let me say that the police representatives were not drawn into any argument of that kind. The fact that the Civil Service may have made a greater sacrifice than the police is no justification for the action of the right hon. Gentleman. The Government appear to have taken the whole series of public services and have said it must be so much from each. There is no question of their having considered any of the factors which determine these scales, and the police are to be told that because the Government are giving a glass of poison to the Civil Service, they must expect to have two black eyes and a punch on the nose, because that is equality of sacrifice.

Hon. Members on this side know too well how in trade union negotiations employers try to play off one section of workers against another. Employers in Germany tell their people that trade union conditions are so much better in England than they are in Germany and that they must bring their standards downs. Employers in this country argue that the German workers produce more than the workers in this country, and that the British workmen would have to come down and meet that competition. I hope hon. Members will recognise that there has never been any question of the willingness of the police to take their part in a common sacrifice, and if it had been three times the amount proposed and it had been a common sacrifice and an equitable sacrifice, there would not have been the slightest kick on their part or on the part of those who speak on their behalf. They feel, however, that they have been specially selected for a special attack; to make a sacrifice which is not equitable.

The right hon. Gentleman says that there have been no comparable reductions in police pay. That is no argument, but let me remind him that the rates of pay of the police were not determined by the cost-of-living basis. He admitted that; he said that it was not the main factor, but something which had to be borne in mind. The police suffered a reduction of 12s. per week when the cost-of-living figure came down to 130, and it is obvious, from the fact that there have been no deductions from that time, that it was intended to maintain the standards which were agreed to in consequence of the inquiry held by the Desborough Committee. I hope the right hon. Gentleman will remember that 12s. per week was taken from the police at a time when they had to meet a, 2½ per cent. voluntary levy to meet the situation which arose a few years ago. In order that there should be a rigidity about their conditions, that there should not be a continual disturbing influence in their lives and in the family budget; in order to preserve contentment, and loyalty and efficiency which can only be secured by having a contented force, it was decided that a voluntary levy of 2½ per cent. should be added to their superannuation deduction of 2½ per cent., making a permanent reduction of 5 per cent. in the rates of pay in the service. May I remind the right hon. Gentleman that one of the last contributions made by the police was the prolongation of their service for four years before they could enjoy a pension? The proposal before the Police Council was that they should not he allowed to retire for at least two years more; and in addition there is the threat that the general standards are to come down regardless of any immediate proposals.

The proposed cuts in the pay of the police force are inequitable. The present Government seem to have failed, miserably and entirely, to understand the word equity. A constable receiving 70s. per week, which by the time all deductions are made means 65s. per week, is to have a cut of 5s. from his pay, but an officer who receives three times that amount is subjected to a cut of 10s. only. The measure of sacrifice, on equity, is determined not by what you take but by what you leave. A young constable with two or three children is being asked to carry a burden of sacrifice which approximates in amount almost to the amount which the chief officer of his locality is being asked to pay. I am not asking that you should increase the amount which the chief officer should pay; the principle is all wrong. I do not think a national crisis, if you accept it as a national crisis, should be an occasion for breaking down all those standards which have been won and carefully arrived at by committee after committee during the past years.

There is a permanency about this policy—[HON. MEMBERS: "No!"]—the mentality of the May Committee leaves no one in doubt. The Committee had a philosophy to which we on these benches must be opposed. The report provides an example. There is a suggestion with regard to the defence forces, the Army, Navy and Air Force. There is a refer- ence to the proposals that were made in 1925 for the pay of new entrants, and those proposals, with the low rate of pay, constitute, in the May Report, the only argument and justification for asking that the 1925 scales be applied to all soldiers, sailors and airmen. The Home Secretary has not said a word in regard to the proposals for new men coming into the police. He proposes to reduce their pay to 55s., but with deductions that will represent only about 50s.

Sir H. SAMUEL

They also have rent allowances, which are fairly considerable, and the actuarial value of the pension they will receive is a very large percentage of their pay.

Mr. HAYES

But you cannot cash at the grocer's shop the pension that you are to get in 30 years' time. Policemen would be growing wings if they could save on the pay of 50s. per week. The new entrants' pay suggested to-day will be used later on as an argument that if they can live on 55s. a week the rest a the service must do so in the interests of national economy. I hope that the Home Secretary will examine these proposals. We are in a difficulty with regard to how much he really wants to save, because he says in his White Paper £500,000 this year and £1,000,000 next year, whereas the Police Orders have declared that it is £500,000 this year and £1,000,000 next year.

Sir H. SAMUEL

I included Scotland in the £1,000,000.

Mr. HAYES

Is Scotland £800,000, and England £1,000,0000?

Sir H. SAMUEL

The White Paper includes England, Wales and Scotland. I am not sure which figure the hon. Member is quoting, but probably it referred only to England and Wales.

Mr. HAYES

The explanation would he all right, but in the Metropolitan Police Order the figure is the larger of the two, and the White Paper says £500,000.

Sir H. SAMUEL

That is because only half the savings goes to the Exchequer. The other half goes to the local authorities. According to the ordinary arrangement when police pay goes up the local authorities have to pay half the increase and the Exchequer half. If it falls, half goes to the State and half to the local authorities. Therefore in this case half of the economies goes to the Budget and half to the local authorities.

Mr. HAYES

There is a discrepancy; and many members of the Police Service, who are not so good at arithmetic, have already noticed it. I would point out, further, that the police are also making a sacrifice under the Income Tax payments that they are to be called upon to make, as they are under the Beer and Tobacco Duties. The right hon. Gentleman may think that policemen do not drink beer. If so, I can assure him that there are exceptions to the rule. It has also to be remembered that policemen in the main are drawn from the families of the working classes. In this great tragedy of unemployment there is hardly a working-class family that is not associated with the police, and many policemen, in common with other working-class citizens, are already making a voluntary sacrifice in helping their unemployed fellows.

The Home Secretary has set up a committee to examine what economies shall be proposed in administrative working. I would like him to feel sure that he is getting the proposals correct. He might add a few more of the rank and file to the committee. At present they are only as two to 14. Fortunately they are two very good men, and they will express themselves forcefully, if courteously. I would like the right hon. Gentleman to feel that all the proposals will be carefully examined and determined, and not by the people who have a vested interest in the proposals, but that in some other way the right hon. Gentleman will discover a disinterested committee. There are many experiments now being carried on which are all very well when there is plenty of money, but when things are tight, as they are to-day, economy might well be commenced on some of these fads and experiments, that are costing a lot of money already. Traffic signals are excellent things, but London is not particularly suited for their use. At any rate, they are a considerable experiment and a double expenditure is going on. You have the traffic signals, and still there must be a policeman to see that they work, and to be on the spot in order to prevent the traffic getting into confusion.

You have the police box system, an excellent thing in suburban areas and extending towns, but I question very much whether the vast expenditure involved in the 800 square miles of the Metropolitan district is justified. There are the mobile police. The tendency there is to go a little beyond the needs of the situation. Motor mobile police are very necessary on big roads where traffic is swift and heavy, but it is wasteful expenditure to have the mobile police running about central London. Moreover, is it necessary for two men to be running about together in connection with these motor duties? Why two men? There is an economy that could be effected. Is it necessary that all the higher ranks should have motor cars in central London, and that they should have chauffeurs? If chauffeurs are necessary let them be chauffeurs and not policemen. Superintendents could drive their own cars. They would not lose any dignity by it. I have to drive mine. In the mounted branch you do not have one mounted man escorting another mounted man in order to give him assistance in a time of difficulty.

You should also redistribute your strength. The distribution of strength in the Metropolitan Police is all wrong. The system has grown up over the years and needs drastic revision. If you went into that matter very carefully you could fill up your suburban areas with the existing strength, and ease up the recruitment for the next two or three years substantially. The Special Constabulary costs tens of thousands of pounds every year. I do not complain of the special constable who gives his services voluntarily and without pay, but the maintenance of buildings, the staffing, the uniforms and the equipment all mean an expenditure of many thousands of pounds. There are too many emoluments being paid in this important voluntary job and they should be reviewed. You could introduce and spread more widely the cycle patrol system. Particularly in the suburbs that would give an efficient measure of police protection.

Then there is the headquarters establishment. In New Scotland Yard in the last 10 years new appointments have been made and for every new appointment there is a deputy appointed, and for every deputy an assistant deputy, and so on. You have a civil staff administering the Metropolitan Police. If figures of comparison between to-day and the time at the end of the War could be supplied it would be found that expenditure has gone up by leaps and bounds. There is in the service a certain amount of voluntary organisation which is not costing the ratepayers anything directly. I refer to the police bands and the police orphanage which are maintained by the men. But the manner in which they are operated causes a direct loss to the effectiveness of the police service. Certain police bands play on the Embankment, at Richmond, and in Birmingham and Liverpool. I always get a special kind of thrill when I hear a police band. I think they are the beet bands in the country, better even than the Poplar Pipers, and they are very good. Music is a recreation and enjoyment for all of us in our spare time. If you are going to use a police band for public engagements the men who are in the band are entitled, of course, to regard that work as a turn of duty. If you have 30 or 40 men in a band you lose 30 or 40 policemen from the service of the community in a particular locality.

Then there is the question of the maintenance of the orphanage. It is maintained by the subscriptions of the men and by money derived from the Police Minstrels. I know that the Commissioner is seriously concerned about the way in which the money has been raised. I ask the Home Secretary particularly to note this fact, and to try, in consultation with the Commissioner, to get a complete review of the method by which tickets for this concert work are disposed of. The present selling of tickets is very undesirable. It involves the whole-time service of a number of police officers, particularly sergeants, and they sell tickets to people who are not always desirable objects for their attention. Many of these people come within the sphere of police action from time to time. If the Home Secretary wants to help the Commissioner he will see that this method is carefully considered. The men have already put forward their proposals. They are prepared to carry the whole cost of the maintenance of the orphanage out of their own subscriptions if this undesirable ticket selling is cut out and if they are given proportional representa- tion on the Board of Management of the orphanage.

I have registered my opposition to the proposals of the Bill. I hope the Home Secretary will consider how far he can make an announcement on Clause 1. I have said that I shall go into the Lobby to cast my vote against the Bill, not merely because I am interested in the police, but because I believe that the Bill crystallises the social injustices and the unfair incidence of this method of tackling the problem.

Mr. BOOTHBY

The hon. Gentleman who has just spoken has dealt, as he is well qualified to do, with the question of the police as affected by the proposals of the Bill. I am sure he will not mind if I do not follow him in detail, because I am not qualified to do so, and if I try to take the Debate into a slightly wider field. I shall vote for this Bill with very considerable reluctance, because I think that if our affairs had been properly handled in this country in recent years there would never have been any necessity for the Bill. I do not oppose the Bill because, as the right hon. Member for Platting (Mr. Clynes) described it, it is revolutionary and disturbing. I imagine that to the right hon. Gentleman anything that had a revolutionary taint about it would inevitably be disturbing. What caused the right hon. Gentleman such misgiving was the fact that the Bill empowered the Government to take action through the method of Orders-in-Council. I believe that the functions of democracy need in no way he impinged upon if the executive is equipped with considerable additional powers in order to take rapid and effective action especially in times of crisis. I think that is inevitable in view of the complex nature of the problems which confront us and the speed at which we live—a speed far greater than that of earlier times. Therefore, I welcome this innovation, and do not regard it as disturbing in the slightest degree. It will, in the long run, make for more efficiency in Government without doing any harm to democracy as a whole.

There can be no doubt, however, that this Bill will inflict hardship upon many classes of the community. With its implications, it certainly will have the effect of reducing for the time being the standard of life in this country. I do not see that any useful purpose can be served by not facing that fact. Also I think it will involve additional unemployment during the months that lie immediately ahead. I think that is inevitable. A cut in salaries and wages is an indication that, for the time being contraction rather than expansion: its the order of the day. Those are the clear implications of this Bill. It involves, contraction rather than expansion; its, effect will be, for the time being, a lower standard of living, and it must cause a certain rise in the figure of unemployment during the months immediately ahead of us. There is not the slightest useful purpose to be served by blinking those facts, and I shall vote for the Second Reading as I say, with great reluctance, because the Bill involves these harsh although, I think, necessary consequences.

I do not think the House has been greatly interested in, and I am sure that no great profit has been derived from the "back chat" which has gone on between, members of the late Government on Friday last and to-day about what happened in the Cabinet before the last Government fell. On the facts, there is no doubt at all that to the principle which lies behind this Bill the last Government were completely committed, and every hon. Member on both sides knows it. Hon. Members on the back benches opposite are certainly entitled to say that if the last Government had brought in these proposals, they would have voted against them. We do not quarrel with that view, but over and over again hon. Members on both sides have asked for the truth and the truth is that, in principle, the late Government were committed to these economies and to balancing the Budget. We have it on the word of the Leader of the Opposition that the late Cabinet had agreed to £56,000,000 of economies. Nobody can deny that, after what has transpired and after what the Home Secretary has said, and whatever hon. Members on the back benches opposite may feel themselves free to do, we on this side are equally free to say that the members of the late Cabinet are not entitled to assault the principle underlying this Bill, or indeed to attack the Bill savagely at all.

It is obvious that having set their hands to this task and having agreed in principle to this policy they all, with four exceptions, ran away, rather than see it through to its only logical conclusion. I think those were four very honourable exceptions. I agree with the hon. Member for Tyrone and Fermanagh (Mr. Devlin), who said that it is all a rather sordid story, and I think it is much better in this Debate to leave it alone and to seek to inquire, first, whether this Bill, which is admittedly unpleasant, is necessary at the present time; and, secondly, if it is necessary, what are the causes that have led to it? I hold that the Bill is necessary. Three weeks ago to-day, whatever hon. Members opposite may say, this country was face to face with the imminent collapse of the pound sterling.

Mr. BUCHANAN

That is a statement which has been made all along during these discussions, and as the hon. Member appears to be fairly well-informed on these matters, will he tell me what is the authority for it? Somebody has told him and he has told somebody else, but can we not get some facts about it?

Mr. BOOTHBY

The hon. Member for Gorbals (Mr. Buchanan) is probably aware that we were only sustained at that time by means of loans which were urgently raised abroad in France and America. When the National Government was formed that loan was very nearly extinguished and if it had become completely extinguished the pound might—I do not say it would, but it might—have started to go, and if it had started to go no one, not even the hon. Member, can say where it would have stopped.

Mr. MARLEY

Will the hon. Member explain to me how the security of a country like France, paying at the rate of 4s. in the pound and already owing us money, was keeping the pound on the gold standard? That is a dilemma concerning which I would like to hear him say something.

Mr. BOOTHBY

It may well be that the financial policy of the French Government has been rather wiser than our own financial policy—

Mr. MACLEAN

rose—

Mr. BOOTHBOOTHBY

I do not think that hon. Members opposite are entitled to cross-examine me. They know, or they ought to know, that the reason why France occupies such a strong position is that the French devalued the franc. I am certain we should all agree that if we had stabilised the pound immediately after the War lower than it is now, we should be in a much better position. It is easy to be wise after the event, and I am the first to admit that at that period of 1918 or 1919, we bit off more than we could chew. But it is no good now trying to argue what we might have done in 1918. The question which confronts us is what should be done in the circumstances which arose three weeks ago. It is all very well too for hon. Members opposite to talk about controlled inflation but if we allowed ourselves to be hurled off the gold standard against our will in a state of something like industrial collapse they would find it very difficult to control anything. If the pound had been allowed to go three weeks ago, nobody can say where it would have stopped. The right hon. Gentleman the Member for St. Ives (Mr. Runciman) has pointed out that the savings of our people, amounting to £2,500,000,000, were at stake. If those savings had gone down to the extent of 6s. or 7s. in the £ it would have involved far greater inflictions and a far greater reduction in the standard of life than the proposals of this Bill.

Mr. WEST

Do I understand the hon. Member to place the figure of savings at £2,500,000,000? Is he aware that that means an average of £240 per working-class family, and does he not see how stupid that is?

Mr. BOOTHBY

I am taking as my authority the right hon. Gentleman the Member for St. Ives. I am stating the figure which he gave, and I am prepared to rely upon his authority. Supposing the pound had gone, however, not only were savings involved, but the economic stability of almost every country in Europe was at stake. Hon. Members know that a large part of the world's trade is conducted on the basis of sterling bills and if every one of those bills had depreciated in value, world trade might have been paralysed. We had a responsibility not only to our own people but to the whole civilised world. That statement is no exaggeration. In addition, if there had been such a collapse it would have endangered the whole in- dustrial fabric of this country and nobody but a logical Socialist, or in other words a Communist, could have wished that to happen. Nobody who did not wish to destroy the industrial fabric of the country could have wished the pound to collapse in the conditions in which it would have collapsed three weeks ago, if steps had not been taken. Therefore I maintain that in the presentation of this Bill, distasteful as it the Government have taken the only way out, in the circumstances of the case.

The Opposition must produce an alternative policy—which so far they have made no attempt to do—before they are justified in trying to make any case against this Government at all. I have listened for three days for some constructive suggestion, some alternative policy, from the Opposition, and I have heard nothing but the most squalid recriminations and arguments as to who said what during the final Cabinets of the late Government. We still await with interest the alternative proposal of the Opposition. Until they produce such a proposal they are not entitled to attack this Government, and I do not think that they are entitled to go into the Lobby against this Bill, because up to now they have, undoubtedly, through the mouth of their Leader, expressed themselves as being behind the principle of the Bill—the principle that, whatever else happens, at the moment we must balance the Budget.

We say that this Bill though unpleasant is necessary. We have next to consider the causes leading up to its introduction. In order to try to discover those causes we have to go back a few years. The hon. Member for Tyrone and Fermanagh said that the forces behind this Bill were the vested interests of this country which were out to attack the working class. I think that is absolute nonsense. I ask hon. Members to consider what this country has been attempting to do since 1918, and I think when they consider it they will marvel, not that the crisis has come, but that the crisis was so long delayed. The remarkable thing about this country is that we should have gone on for so long attempting the impossible. What have we been trying to do? We decided to go back to the gold standard on the pre-War parity of exchange. [Interruption.] It is no good hon. Members opposite saying that it was the right hon. Gentleman the Member for Epping (Mr. Churchill) who did it. That policy was decided in 1918; the right hon. Gentleman put the finishing touch to it here, and no one was a greater advocate of that policy than the present Chancellor of the Exchequer. He approved of it thoroughly.

It is very easy now to go back on these things, I agree, and some of us have been saying for many years past that we tried then to bite off more than we could chew. I am merely pointing out that that is the policy which we adopted. In addition we decided to repay our external debts in full. We also decided to remit a large portion of the debts owed to us by foreign countries. And to one European country after another we gave financial assistance during the last 10 years in order to bolster them up at critical periods. I believe that the financial assistance which we have given European countries since the War amounts to over £100,000,000. That is over and above debt remissions to foreign countries. Last but not least, we decided in 1918, and have held to it ever since, to remain the only completely free importing country in a changed and highly protected world. Considering these various facts the marvel is, as say, not that the crisis has come, but that we should have survived so long in attempting to carry these terrific and gigantic burdens. It is a great tribute to the fundamental economic strength of this country that we stand where we do to-day and are able to put through this tremendous Budget. I believe that deep down the economic strength of this country is as great as ever, and I believe, it can be made just as great in the future.

What was the result of the policy which I have described? Our revenue began to fall. Our exports began to fall. The figures of unemployment rose, and at the beginning of this year we were faced with a budgetary crisis. Underlying the budgetary crisis, there was an industrial crisis of the first magnitude, and underlying the industrial crisis there was the crisis of the balance of trade, which went from bad to worse. This year we have imported twice as much as we have exported. Nothing was done. The hon. Member for Tyrone and Fermanagh spoke about the boldness of the late Government, but the late Government did nothing in face of a crisis that was growing from day to day. There they sat, warned from all quarters, and nothing happened.

That is not the whole story, either. Superimposed upon the national crisis involved in the industrial depression and the collapse of the figures of the balance of trade, was a world crisis in prices, as hon. Members opposite know very well. Since 1924 the index figure of commodity prices fell from 166 points to 137 points, and the result on producers in this country, on manufacturers and farmers, was catastrophic. No producer could possibly make a profit in such circumstances, for his produce was bound to bring him less than his costs of production, and our producers, whether manufacturers or farmers, have been working against falling commodity prices for the last eight or nine years.

In 1922, I would remind hon. Members opposite, the Genoa Conference warned the world that an international gold standard without international understanding and co-operation might mean the very gravest and direst peril, and that in effect is what has happened. The Genoa Conference said that a conference of the central banks ought to be held at the very earliest possible moment, to stabilise the value of gold in terms of commodites and to economise its use. That conference was never held, but what happened? The two great creditor countries in the world, France and the United States of America, refused to take goods or services or to lend on long term abroad, and the result has been an absorption by those two countries of the gold supplies available for monetary purposes without parallel in the history of the world. There is over £1,000,000,000 worth of gold in the vaults of the Federal Reserve Bank of New York and £470,000,000 worth in the vaults of the Bank of France. What was the result of that? As the value of gold steadily rose, so the value of goods steadily fell, and the burden of debt, whether national or individual, and of all debenture and fixed interest charges steadily increased.

Whatever one's political views may have been, to whatever political party one may have belonged, it was quite obvious, under those circumstances, that unless something was done, in some direction, economic disaster lay ahead, and a crisis could not be averted. All this year we have been drifting along in this country, and it did not require a genius, an economic or a political genius, all through these summer months to hear the breakers that were lying ahead. But anyone who ventured to suggest that all was not right, anyone who dared to suggest to the Chancellor of the Exchequer that our monetary policy was not the most perfect in the world, or that our fiscal system was not absolutely sacrosanct, was treated kith the utmost disdain. Over and over again, hon. Members opposite will do me the credit of agreeing that I bored them for months past by asking questions and putting points on the subject of our monetary policy and our fiscal system to the Chancellor of the Exchequer. What was the treatment that we got? We were told in effect to mind our own business and to attend to things that really mattered and were of vital importance, to attend to things like the taxation of land two years hence and electoral reform.

That is the frightful condemnation of the late Government, that during this critical period all that they invited this House to do was to jaw about the hypothetical value of the land of this country two years hence and to discuss whether we ought to have two or three motor cars at a General Election! But futile and impotent as the Government were then, we have heard to-day from the Home Secretary that they remained so right up to the eleventh hour. We continued to live in this fools' paradise until what the Prime Minister has called the typhoon broke, and I beg hon. Members opposite not to go on talking about it as if it had been purely a bankers' ramp. [HON. MEMBERS"So it was!"] How can they say that, as if the bankers of this country, who are fairly well-to-do people, wanted to ruin themselves? On the contrary, they were out to do the best they could for the country, and in the position in which we found ourselves three weeks ago, I believe they took the only possible course.

Now I want to say a word about the future. I have tried to indicate that I believe this Bill to be necessary, and I have tried to indicate some of the causes that led up to it, but what about the future? Is this Bill to be the last word? For my part, I hope it is not. The emergency has been met by au emergency Measure, but I agree with the hon. Member for Tyrone and Fermanagh that we have to have in this country, and sooner rather than later, a Government with constructive ideas and not merely a Government of negation, a Government that has ideas for improving the standard of life, a Government that is not content merely to sit back and reduce the standard of life. I think the present proposals will tide over the emergency situation, but the Prime Minister said the other day, and said quite rightly, in my view, that over and above the Budget emergency there was a financial position which had to be made sound. The proposals in this Bill, in combination with the Budget proposals, solve the immediate budgetary position, but the financial crisis will recur inevitably unless, subsequent to this Bill, we take action designed to revive industry in this country and designed, above all, to restore the trade balance of this country.

Apart from the immediate emergency, the only thing to be said in favour of the Bill is that it gives us a solid foundation of rock, at any rate, on which to build in the future, but if it were to be the last word, I should really be apprehensive about the future of this country, because in itself it, intensifies the deflationary process which has gone on. The fundamental world economic problem is the problem of over-production or potential over-production—[HON. MEMBERS: "Under-consumption "]—coupled with falling prices. How can you solve that by reducing purchasing power? Mere contraction and negation can never do it, I agree. We want not to destroy and smash agriculture, which is having the greatest difficulty to survive in this country; we want to rebuild it. We do not want to shut clown industry after industry, especially among the basic exporting industries; we want to reconstruct industry and to rationalise it from top to bottom. We want to raise wages in the long run. [Interruption.] We all want to do it, and it is significant that the country which for a brief period of time enjoyed the greatest prosperity among every class in the nation, was the United States of America, when wages were at their very highest peak.

Hon. Members opposite may ask what are the tools with which we are to embark on any constructive policy of that kind. We wait for the constructive proposals of right hon. Members on the Front Bench opposite, and so far we have waited in vain, but upon our side of the House, at any rate in the party to which I belong, we have got our proposals to make, be they good or bad, and our basic proposal is that the whole trade and industry of this country must, under existing conditions, be protected, and protected at the earliest possible moment. The issue is plain. It is to say to the people of this country, under whatever system, be it Socialist or Tory, they may happen to be living, "Do you in fact wish to have a, fiscal system now, under modern conditions, under which your wages and standards have got to be forced down to Continental levels, on the one hand, or, on the other hand, do you want to try to maintain in this country and in the British Empire a standard of life higher than that which prevails in the rest of the world, a standard that will command the admiration and the envy of the world?" That is the issue which has to be fought out, and to be fought out, in my opinion, before very long.

I would like to say one word about a remark which fell from the lips of the right hon. Gentleman the Home Secretary in his opening speech this afternoon. He said that in this crisis the House of Commons had a great part to play. He said that there had been talk of a decline in the prestige of Parliament, and he said he disagreed with that; he said he thought this House had risen to the occasion of a great crisis, and he thought it would continue to rise to the occasion. I agree. I would like to make a suggestion, and particularly to the right hon. Gentleman the Home Secretary. I agree that the House of Commons has a great part to play, and I would ask him whether he would allow this House to give a free vote, at the very earliest possible opportunity, upon the principle of Protection, not upon the detail, with the Whips of all parties taken off, and I would ask whether he would agree that the present Government should abide by the result of such a division, and that if this House, with a free vote, an consideration of all the facts, voted in favour of the principle of Protection, the pre- sent Government should proceed to apply it in the best way at the earliest possible moment.

Unless the present Government did take a step of that kind, I would not vouch for its existence beyond the immediate necessity. I believe that if it were to take such a step and embark on a constructive policy, it might well prolong its own life; but if it has no constructive policy, I believe it is the duty of the party to which I belong to see it through the necessities of the moment, but subsequently to proceed to the country with the remedy in which we believe, and to fight that issue at the earliest possible moment; because if not, I think the standard of life in this country will be lowered for some period below what the basic facts of the economic situation warrant, and that., I think, would be a real tragedy.

Mr. COVE

I cannot follow the hon. Member for Eastern Aberdeen (Mr. Boothby) into his interesting argument in any detail because my purpose in rising is altogether different, but I would like to point out, in passing, that all the criticisms which he has just uttered are criticisms against the very system of society which he supports; and, further, while he praised the policy of high wages in America, he conveniently forgot to tell us that even in America, with its high tariffs, that high wages policy has broken down and that capital in America is in as heavy waters as those in which capital finds itself in this country. I should have thought that the hon. Member, in his very constructive speech, would have told us exactly how we were to bring prosperity hack to our common folk in this country. While he advocated a higher standard of living and prosperity, and while he recognised the bad economic effects of cutting down purchasing power, he is going to-night to vote for the Bill which will do all the damage he desires to avoid.

7.0 p.m.

My main purpose to-night is to put as clearly as I can the case for the teachers as they are affected by this Bill. I welcomed the speech of the right hon. Member for Ross and Cromarty (Mr. Macpherson). I gather that he admitted that a grave injustice was being done to teachers, and recognised that teachers were being singled out for a special penalising cut. He further recognised that in any sort of fairness—although he mentioned the figure, I am not going to subscribe to it—a principle of fair relativity applied to teachers in this case would have meant not more than a 10 per cent. cut, while this proposal is a 15 per cent. cut. He recognised that it is entirely unjust to place this burden upon teachers. What I could not understand about the right hon. Gentleman was that he should have admitted the injustice of singling out the teachers, and then at the end was going to vote for that injustice.

Mr. MACPHERSON

I tried to point out to the House the difficulty in which Members like myself might be placed. We cannot move an Amendment although I would have supported an Amendment. If I were to take the view he suggests, I should be held not to agree with the other parts of the Bill.

Mr. COVE

This is exceedingly important. I have never known teachers so intensely interested in the proceedings of Parliament, or so politically minded. The right hon. Gentleman says that he cannot vote against this because it is included in the other proposals. In the first place, I understand that we are going to have an Amendment to delete education. Might we take it then that the right hon. Gentleman and the Liberal party, with which teachers are very intimately associated, as in their minds the Liberal party has been the friend of teachers and of education, will support an Amendment for the deletion of education?

Mr. MACPHERSON

What does the hon. Gentleman mean? Does he mean to delete all the provisions with regard to education, or cuts of salaries?

Mr. COVE

I understand that the right hon. Gentleman will not support the deletion of the whole of the educational proposals?

Mr. MACPHERSON

Not even the hon. Member's party will do that.

Mr. COVE

I say frankly that, if they had made these proposals about education, I would have been asked by the National Union of Teachers to fight them. The National Union of Teachers is not concerned which party it is. If, in its opinion, it is against the interests of teachers or of education, then the National Union of Teachers will oppose it. I ask the right hon. Gentleman and his friends to vote for the deletion of education even more than for the deletion of teachers' salaries. The educational damage in this Bill is not concerned with teachers' salaries. It means stagnation in the development of our elementary system, the starvation and crippling of our secondary system, and increased fees. Not only will the working classes find it impossible to send their children to secondary schools, but the lower and upper middle classes will not be able to afford to send their children to secondary schools because of these financial provisions. As far as the cut in the salaries and educational provisions are concerned, this is not a temporary measure but a permanent measure.

Viscountess ASTOR

Who says that?

Mr. COVE

The White Paper says it. It not only cuts teachers' salaries by 15 per cent., but alters the grant regulations in such a manner as to be financially disadvantageous to the local authorities. There can be no mistake about it. The leading article in Saturday's"Manchester Guardian" condemns these proposals even more vigorously than I am condemning them, and points out that the proposals as regards education and teachers are not temporary proposals to meet a temporary emergency, but are a permanent crippling of the whole education system. I, therefore, ask the party historically associated with my own party in the cause of education whether they are prepared in an emergency of this kind to effect permanent cuts on teachers and on the education services. The Minister of Education is here, and I would like to ask him what safeguard there is in these proposals that the 15 per cent. is the end of the cut upon teachers. The local authorities are not going to save one penny out of it, because it is proposed that the whole of the 15 per cent. shall go to the national Exchequer. Where, then, do the authorities come in this business? The authorities have been saying that the burden of the rates demanded cuts in teachers' salaries, but they are getting nothing out of it, and I want the Minister to tell us if he proposes any safeguard, where the safeguard is, and how the teachers are to be protected from another 15 per cent. cut on the part of the local authorities, who say that not only is the nation in difficulties but that each local authority is in difficulties.

The Liberal party are supporting proposals here which are cruel in their effect on teachers, cruel in their effect on children, and a complete reversal of the whole of the aims of the Liberal party. These proposals are based on the report of the May Committee. What is the philosophy behind that committee? Let me give a quotation: Since the standard of education, elementary and secondary, that has been given to the child of pour parents is already in very many cases superior to that which the middle class parent is providing for his own child, we feel that it is time to pause in this policy of expansion. Does the Liberal party support that? Will the right hon. Gentleman who has spoken for the Liberal party support it? [HON. MEMBERS: "Your leaders support it!"] We will down them if they dare to support it. When the May Committee was being discussed, and I heard about the terms of reference being the Geddes terms of reference, I said that that was sufficient for me, and I walked into the Lobby against the setting up of that committee. Here is the philosophy behind all this business. The poor man's child is getting an education even better than is asked for by the middle classes. It is reaction and class prejudice, and I am certain the Liberal party would not subscribe to it. Is not the right hon. Gentleman for the sake of £2,000,000—for it is only £2,000,000 that is needed to get a 10 per cent. cut—going with his party into the Lobby against what is a dictatorship imposing an admittedly unjust penalisation on a section if the community? I believe that the Liberal party hold the balance, and want to do what is fair. I am certain they do not want to do an injustice and, therefore, I am asking them, on the broad basis of the reactionary penalisation of education involved in this, and on the narrow basis of the unjust penalisation of teachers, to tell the Government now that they will demand justice both for children and for the teachers. I am sure that even this Government would meet that fair and reasonable case.

The May Committee suggested that teachers' salaries were based on the cost-of-living index figure. That is an entirely wrong consideration. I went through the negotiations. As a matter of fact, I would not have been here had it not been for the scandalous salary I received as a teacher. My salary after the War was about 34s. a week, and I had been in college and been through the War. The pre-War average given by the May Committee was 36s. a week. I and others after the War said that we would not put up with it, and the teachers, although they are a body that will not strike if they can possibly help it, and a body against whom the criticism is made of being ultra respectable, were driven by the sheer desperation of low salaries like my own to take up a strike attitude. I came out on strike, and we won. It caught on, and there were strikes here and there until Mr. Fisher said that it was exceedingly bad for the schools and was a danger to the community to get teachers into the schools full of the strike spirit. He said that to have teachers teaching the children when they were disgruntled and dissatisfied was a menace to the State. Mr. Fisher called them together and told them to meet the local authorities in order to find an orderly solution of the salary problem.

The Burnham Committee, which has been one of the most successful negotiating committees ever established in the realm of salaries and wages, settled the whole problem. It was an effective piece of arbitral machinery, and now the proposal of the Government means that the whole process of negotiating machinery, the whole work of arbitration, is to be swept away by a stroke of the pen. The teachers have contracts for their present salaries until next March. Those contracts are to he ruthlessly broken on the 1st October. How can you expect respect for contracts? How can you expect men and women in the schools to have some regard for the sanctity of contracts when with the State a contract is a mere scrap of paper? Never in my experience have I found such spontaneous rank-and-file resentment—bitter resentment—because you are driving hundreds of thousands of our teachers, not to the position of giving up luxuries, but to the position of sacrificing the necessaries of life. It is an utterly wrong idea to think that teachers are well paid. They are not. There are tens of thousands of them below 40s. or so a week. In every party there is tremendous uneasiness about this cut. The May Committee says that the teachers' scales are based upon the cost of living. Let me give one authoritative quotation. When the local authorities gave evidence before the Geddes Committee, they said this, and I hope that very special attention will be paid to it: The teachers, who urged insistently in August, 1920, the excessive cost of living, were given their option of a sliding scale of salaries, high at the moment, but falling as prices fell, or a scale based upon normal prices but continuing unaltered for a period of years. They chose the latter, and thereupon the cost of living ceased to be a factor in the scale. It was at that period that we made our contribution to the cost of living. It was then that we received a cut. If the teachers had chosen, as it is admitted by the local authorities they could have done, the principle of the index figure, they could have had a higher scale with a descending figure; but, instead of having a high scale when the figures of the cost of living were high, the teachers said, "We prefer stability; we prefer security. We believe that with that stability and security you will attract a better type of people into the profession; it will be better for the schools, better for the children, and better for all concerned not to have a high salary at the beginning, but to have a more moderate one and for that to continue." I am right in deducing from that that it was initially that we had our cut. The cut was made then because we could have had a higher scale. Now the May Committee recommend a cut, and the Government say, "We will cut these salaries by 15 per cent."

I have in my possession the budget of a married man with one child in the higher scale, which is scale IV, under which he obtains in London and the environment a salary of only £3 8s. a week. His first item is "building society, 18s. 8d." The right hon. Gentleman the Secretary of State for the Dominions knows that this is long-term commitments and that the cost-of-living index figure will not apply to it. He was the distinguished chairman of a society which was very helpful to thousands of teachers, and he knows very well that here is an item which, whatever the cost-of-living figure, will not fluctuate and will be a permanent burden and commitment which these teachers must pay or they will largely forfeit what they have saved. Then he gives "personal insurance, 5s." Variations in the index figure will not relieve that, as there is no application of the index figure to premiums on insurance policies. His other items are: rates 5s. 1d., coal and coke 3s. 1d., gas 1s. 6d., water 5d., electricity is. 1s. 10d., fire insurance 3d., travelling to and from school 6s. 3d., total £2 2s. 1d.

This leave him with £1 8s. 11d. out of which he has to find food, clothing, holidays, doctor's fees, cleaning materials and other incidental expenses. Is that a professional standard? Is that a rate of wages that ought to be paid to a man who has been to the secondary school and who, as in this case, went to the university? He was four years in the university and was 21 or 22 years of age before one penny was earned. Yet you come along and say that wages round about £2 or £2 10s. a week are a fit and proper standard for this man. One of the items that has struck me in these budgets is a commitment in the form of a loan for going to college. I knew it existed, but I did not know it was so prevalent. Various education authorities give these loans, but I confess that I did not know the extent of them. I have papers here showing that in one case, that of a man from Wolverhampton, a teacher has to pay, out of £2 a week, £30 a year back to his local authority.

The real truth of the matter—and the Government know that it is true—is that you are eating not only into the professional standards of the teaching profession, but into the bare necessaries which teachers want in order to live. There is no equality of sacrifice here. There is no equality of sacrifice to the individual teacher or to the social service of education as a whole. If hon. Members look at the figures given in the minority report of the May Committee, they will see that out of an increased expenditure over the pre-War period—an expenditure roughly of £633,000,000–60 per cent. is due to the Debt and interest on the Debt. Only 6 per cent. is due to the increase on education. Is it equality of sacrifice to allow that 60 per cent. increase to go untouched, and to cut down the 6 per cent.? Take again the relationship to national income. The May Committee in the minority report, show that the expenditure in relation to national income on the social services before the War was about 7 per cent. That has increased since the War to 18 per cent. Seven per cent. of the 11 per cent. difference is due to the increase of the War Debt; 49 per cent., is due to the increase on education. I ask the Liberals again to read the "Manchester Guardian" leader of Saturday.

The Government comes along and says, "We will deal very gently with the Fighting Services. There we can get economies, but not continuing economies or certain economies." There is no continuity or certainty in the economies proposed by the National Government on the Fighting Services, but there is continuity and certainty in the cuts on education and in teachers' salaries. It is agreed on all sides that the cut proposed in education and teachers' salaries is invidious. It is a cut, the fret of which has stirred the whole profession to the depths of its being. Never have they been so politically minded as they are at this moment.

Viscountess ASTOR

What are they going to do?

Mr. COVE

I invited the hon. Lady to meet me at Plymouth the other night. I shall be only too glad if she will arrange to have a conversation with me on a public platform. Speaking not for myself, but with the authoritative voice of the National Union of Teachers, I want to say that the union does not want to enter the political field. It does not want to have its salaries dragged into the political arena or to have education a matter of party politics. Quite clearly and distinctly the National Union of Teachers say that so far as education is concerned, it takes its stand above party politics. If the Government thrust teachers' salaries and education right into the centre of political activities, the union will have no option but to fight its battles on the political stage. If the Liberal party and the members of the Conservative party to whom it used to look as their friends fail them, the inevitable result will be that masses of the teachers teaching the children in the schools of the country will have no option but to support the Labour and Socialist party.

Major BEAUMONT THOMAS

They do now.

Mr. COVE

The vast mass of teachers, I am sorry to say, are not my supporters; they do not assist me in an election in any great numbers. There are members of other parties who know very well that teachers have supported them in their constituencies. I am going to appeal to the Minister to make some statement to-night. [Interruption.] No statement? Are we to take it that the Government are still determined to perpetrate this cut? Cannot we have some statement'? The turmoil is taking place now, the schools are uneasy now, the schools will be uneasy this week, and I am asking the Minister to re-examine this matter. Look at the facts—at the fact that the scales of salaries do not provide a living wage. Look at the facts of the teachers' commitments in respect of housing, rates, insurances, mortgages—all sorts of long-term commitments which cannot be reduced according to the cost-of-living index.

I ask the Minister to remember that this is a direct breach of contract with the teachers. I ask him to go back to the Cabinet and tell the Prime Minister and the Chancellor of the Exchequer that the Liberal party, according to the view expressed this afternoon, is prepared to ease the situation by £2,000,000. Let the President of the Board of Education convey to the Chancellor of the Exchequer and the Prime Minister the profound discontent, the disgust even, expressed by the right hon. Member for Ross and Cromarty this afternoon. Let him go back and say that an injustice perpetrated upon the teachers, which will produce a disgruntled and dissatisfied teaching profession, is a menace to the State which they wish to support. In the name of fair play and decency of treatment I ask the right hon. Gentleman to send us back unfettered to the Burnham Committee. Let the employers and the employés get together, free and unfettered. Let the process of conciliation go on, and, if conciliation round the table fails, let -them resort to what they have hitherto resorted, a decision of an independent arbitrator. The scales now obtaining are not the result of a struggle, not the scales arrived at by force, not the scales obtained merely by the power of fighting, but they are the unbiased decision of an independent arbitrator, Lord Burnham. I ask the President of the Board of Education to revert to that method. Let conciliation take its place, let arbitration, if necessary, ensue, let the machinery go on, in order that justice and fair play may be done to the teachers and the schools of this country.

Major CHURCH

Like many other hon. Members who have addressed the House I have misgivings about the cuts in the wages and salaries of various classes in this country which have been suggested. In the last speech I made before the House rose for the holidays I dealt with this very subject. On that occasion I spoke in terms of the strongest condemnation of any policy deliberately pursued by any Government which would reduce the standard of life of the people. As an illustration I referred at that time to the German nation which, to puts its budgetary position right at the behest of its foreign creditors, again and again in the last few years reduced the wages of its working people, the salaries of its civil servants and the salaries of practically every other class in the community. I said then, and I am prepared to say now to this Government, that that way lies madness, unless there be some constructive policy in addition to the purely negative policy which these economies embody. There I am on the same ground as the hon. Member for East Aberdeen (Mr. Boothby).

Economies alone will merely reduce the standard of living all round. They may possibly reduce retail prices, and bring them more into conformity with wholesale prices, but, generally speaking, that is not going to improve the trade position of this country, and if we are not to improve the trade position of the country, I do not see that eventually we shall improve the budgetary position. With regard to these temporary expedients—[Interruption]. The May Committee was set up by the late Labour Government—by a resolution of the House. The chairman of the committee was chosen, presumably, by a Member of the Labour Government, its membership was settled by the Members of the Labour Cabinet, and presumably that committee produced its report and sent it to the various members of the committee. Presumably some member of the Cabinet had a copy of the report before it was published. We are told now that the publication of the May Report—and I agree—with its damaging admissions about the country's trade and the country's credit, did this country incalculable harm in the eyes of the world, and particularly in the minds of those people in other countries with money to invest. The fact to remember is that they were just as panicked by the position of this country as they were panicked by the position in Germany a short time ago. I want to remind hon. Members what that panic position lead to. It could have been averted by the Labour Government if, eight months ago they had listened to the warning given by Germany with regard to its own budgetary position and the need for bringing down the standard of living at the demands—yes, the demands—of the creditor nations, of which we are one.

Mr. MacLAREN

Your present leader ignored the warning.

Major CHURCH

The warning was given, the whole Labour party were quite aware of the position of the country, and the Labour party were prepared to sit on and to wait. Again and again the Labour party's currency committee brought to its meeting authorities of various kinds, and practically with one accord—with the one exception of the last authority who addressed that currency meeting—those responsible representatives of the world of finance condemned the currency policy which was being followed by this country in common with the other creditor nations of Germany. The Labour Cabinet, unless they were deaf to all responsible utterances by the experts to whom they subsequently went, must have known what was the opinion of the financial world with regard to the possibilities of a grave crisis arising in connection with our national finance.

The crisis came upon the country. That is the one thing we have to face. The crisis was upon us. I agree with every hon. and right hon. Member who has spoken that it is one thing to go off the pound deliberately, to devalue your pound to, say, 16s. in the pound, and another thing to be tumbled off the pound. Like many other Members of the House, I was in Germany in 1923, during the worst period of its inflation. What happened to the professional and working-classes there? The late Government had its warnings—at least, presumably it had; but it had a Chancellor of the Exchequer who was deaf to the pleadings of everyone but the orthodox financiers. [HON. MEMBERS: "You have still got him there!"] I am not responsible for that The whole of the Labour party at their conferences—there may have been one or two small voices against it—backed his explanation again and again that all was right in the world of finance as long as this country did not attempt to go off the gold standard and as long as the pound maintained its parity with the dollar. That was the whole of the law and the prophets in the matter of finance. It was the whole of the law and the prophets of the Labour party, as accepted at the various conferences of the Labour party. Any word of criticism of the present Chancellor of the Exchequer—then the Labour Chancellor of the Exchequer—was regarded by the vast majority of those present as awful as an attack upon the Deity. If anybody ever suggested there was an alternative policy or proposed to try to free the country from its injurious effects, or to say at a party meeting that all was not well with the state of the country—[An HON. MEMBER: "You never did, anyway!"] If we urged that we must face this problem of accepting imports from countries with a depressed currency or with a standard of living which would be regarded as a disgrace to this country; if any suggestion was made that goods made under sweated conditions abroad such as would not be tolerated in this country should be excluded from this country; if we said that the conditions applying to the manufacture of goods in this country should apply to the goods that we allowed to come in from other countries; if we asked that what appeared in "Labour and the Nation" in regard to this matter should become the practical policy of the Labour party, we were told that that might come with the millennium, but that this was not the time for it.

Mr. KELLY

You know that is not correct.

Major CHURCH

I am speaking now of the majority. I agree that the hon. Member for Rochdale (Mr. Kelly) is one of the few exceptions.

Mr. DALLAS

You never raised it in the party meetings.

Major CHURCH

I have a distinct recollection of one occasion when 1. raised a similar issue in regard to the exclusion or, rather, the regulation of the imports of certain commodities in the House itself. The regulation of the import of dyestuffs is based upon a definite agreement between the Government and the manufacturers of dyestuffs, and that agreement includes a definite Clause regarding the price which can be charged by home manufacturers to dye users here. The price charged by the manufacturer in this country has to be a fair one as compared with the price charged for dyestuffs made abroad. I dared to challenge the position of the Government on that particular Clause when that Measure was being considered under the Expiring Laws Continuance Bill, and I went into the Lobby to vote against the inclusion of that Act. Subsequently, this House agreed to the decision of the House of Lords on that subject. That Act regulated imports under definite conditions, and it was possible, under that Measure, to improve the position of the manufacturers of dyestuffs.

We had opportunities of dealing with all imports in that way, but we never attempted to take advantage of that opportunity. Now we are faced with an emergency, and we are committed to a policy of doing a good deal in the direction of the reduction of wages. I recollect an address which was given by Professor Keynes, who warned the members of the Labour party what would happen unless they were prepared to balance the Budget or raise expenditure other than by increasing direct taxation. I recollect that Professor Keynes suggested that it would be well for the Chancellor of the Exchequer to bring in when he introduced his Budget in April last an emergency tariff of 10 per cent. on manufactured goods and a tariff of 5 per cent. on foodstuffs and raw materials.

Mr. W. J. BROWN

On a point of Order, Mr. Speaker, may I ask what all this has to do with the Economy Bill?

Mr. SPEAKER

Arguments of this kind have been running all through the Debate.

Mr. BROWN

If we are not limited to the suggestions contained in the Bill, I am sure that many hon. Members have other suggestions to make.

Mr. SPEAKER

I do not think I have hardly ruled anything out of order.

Mr. BROWN

If I suggest a capital levy, shall I be in order?

Mr. SPEAKER

I will wait and see what the hon. Member raises before I give a Ruling.

Major CHURCH

A certain amount of interest was aroused at the time by the announcement of those proposals by an economist who had always been identified with the Free Trade party, although he has since renounced his early faith, The question arose as to what would be the effect of a 10 per cent. revenue tariff in this country upon the cost of living, and this well-known economist expressed the opinion that a 10 per cent. revenue tariff on manufactured goods would raise the cost of living by 1 per cent., and he also gave it as his considered opinion that the effect of a revenue tariff of 5 per cent. on foodstuffs and raw materials would raise the cost of living by another 2 per cent. The two tariffs would have the effect of raising the cost of living in this country by 3 per cent.

The proposals which we are asked to consider to-day were tentatively put forward by the late Cabinet as a basis of discussion, although it is conceivable that every Minister whose particular Department was concerned would have vigorously protested against any such cuts. At any rate, those proposals covered the whole of the ground with the exception of the proposed cuts in unemployment benefit. The Labour nominees on the May Committee, in their minority report, suggested a reduction of 12½ per cent. in the teachers' salaries. As a former teacher, and one who speaks with some responsibility for the training of teachers, I regard this suggested 15 per cent. cut in teachers' salaries as thoroughly harsh and unjustified, and I would like to ask the President of the Board of Education to try to persuade his colleagues to change their opinion on this point. I know it will be said that this is an emergency measure, but I think this proposed cut in teachers' salaries should be carefully and fully considered in the light of reason tempered not merely with justice but with a good deal of common sense. After all the promises which have been made, apart altogether from what was promised to pre-War entrants and the promises made to post-War entrants with regard to the professional status achieved by the teachers, I think this is the worst of the economy cuts that has been suggested by the present Government.

I have been wondering what other positive proposals can be brought forward instead of this cut in teachers' salaries. No class in the community is more willing to bear its proper share of the burden which is now being placed upon the nation, no other class is more willing to bear its proper share, and if the percentage had been more reasonable, there would not have been such a tremendous wave of resentment among every teacher in the country, including secondary school and university teachers. I assure the Government that it does not realise the amount of resentment which it has created by what is regarded as a completely unfair differentiation, and I am still hopeful that the Government will reconsider its decision. Economies of this kind are false economies, and they are definitely destructive of the body politic. Incidentally, may I remind hon. Members on this side of the House that there are a great many Members of the Conservative party included in the ranks of elementary teachers.

I want it to be definitely understood that the last Government tentatively agreed to cuts of this kind. I am not suggesting that every member of the late Cabinet was prepared to support the proposed cuts, but I should like to know if the proposal contained in the May Committee minority report for a cut of 12½ per cent. in teachers' salaries when put forward was resisted at a meeting of the Labour Cabinet as a whole. We are now told that this proposal for a 15 per cent. cut must be accepted if we are to tide over our present difficulties, and I want to make one or two other suggestions with regard to the emergency. We have other means of raising money and other means of appealing to those who are better able to bear the burden than by reducing services of this kind, and creating in the minds of those people a feeling of resentment which is bound to, have a bad effect upon the future education of the children of this country. Is it not possible for the three leaders in the Cabinet—the Prime Minister, the Lord President of the Council, and the Home Secretary—to appeal to the patriotism of the holders of the £2,095,000,000 of 1929–47 War Loan, to come forward and offer to convert their present holding of 5 per cent. to a holding of 4 per cent. or even 3½ per cent. If that were done, it would relieve the Exchequer of a tremendous burden of interest.

8.0 p.m.

Capital is already flying and the emergency Budget is evidence of that fact. The Chancellor of the Exchequer knows as well as I do that there are a number of English solicitors and men of standing operating in foreign countries, forming holding companies in places like Luxembourg for the avoidance of tax. An appeal such as I suggest to the people of this country who hold War Loan would, I am sure, not be without response. We are in the midst of a national crisis, and the very class of people I am referring to came forward during the War with their money and their lives and many made the common sacrifice. Surely they would not he averse to such a conversion as I have suggested. Similar steps will have to be taken in other countries, and, if this country took a certain course, I feel certain that America would follow suit. There are 6ther ways of mitigating the position with regard to the teaching profession. I should like to see this question taken up by the President of the Board of Education or the leader of the House. Could we not ask the teachers to accept this cut of 15 per cent., great though it is, for a year or two as an emergency measure, and at the same time issue to them national bonds equivalent to the amount of the cut, redeemable in two years' time by which time, we are assured, we shall be in a position to redeem them? If the country's position is not improved in two years' time, there is apparently going to be no hope for the country at all. In the meantime, I suggest that there is something else for this Government to do besides making economies.

The hon. Member for East Aberdeen (Mr. Boothby) has given the House an interesting address on the subject of currency, and he has rightly said that currency is international. Is it not time that there was an international conference on this question of currency; is it not time that there was, not a seven-power naval conference, but a seven-power economic conference, in order that the heads of the various States might consider their interrelated problems and make up their minds that the present position could be remedied. One of the troubles from which the world is suffering is not dissociated from a book written by a certain hon. Member of the Labour party. He wrote "The Great Illusion," in which he suggested that, if the world went to war, the world would be so impoverished that we should never be able to live decently again. That idea seems to have bitten into the minds of practically all the Governments in the world, but I challenge it. It is not a fact. The world is not poorer, but immeasurably richer in actual and potential wealth than it has ever been before. As compared with the last century, the standard of living has risen immeasurably. The standard of living of the workers in this country, and even in Germany, the country of our late defeated enemies, is to-day considerably higher than it was before the War, and the general conditions of labour are very much better.

We do not want to go back; we do not want to retreat one inch from the ground that we have gained. There is no reason why we should. The superstructure of modern society has been built up on the basis of applied science, although that fact is very imperfectly recognised. The results of science are accepted without inquiry, and there is scarcely any evidence that the contributions of a whole galaxy of scientific men in this country are known or appreciated by any save a very few. Yet this country has added to the dignity, the wealth, the philosophic outlook of the whole world. Let me mention the names of a few of our eminent countrymen: Harvey, Newton, Boyle, James Watt, Joule, Davy, Faraday, Clerk Maxwell, Perkin, Lister, Darwin, Lawes, Bateson, Parsons, Ramsay, Rayleigh, Manson and Ross. As a nation we are not even dimly conscious of the contributions which their knowledge has made to our philosophic outlook or to the material wealth of this and other nations.

A century ago the population of Great Britain was 10,000,000, and a great many of the people were living below what we should regard to-day as bare subsistence level. To-day our population is over 40,000,000, and there are very few hungry people among us. A century ago there was misery, child labour, poverty in every town and village. The fact that we can supply our present-day needs is due mainly to the thought applied by the scientists of the last century. Let us consider this generation alone. In my lifetime I have witnessed a revolution in the methods of road travel and transport, the birth of the aeroplane and the airship, a revolution in the materials used in and the methods of warfare, wireless transmission of telephonic and telegraphic communications, broadcasting and television, the development of the cinematograph industry, the manufacture of artificial silk, the discovery of radium, the application of X-rays to the diagnosis and cure of disease; the examination of the structure of metals and of textile materials, the invention of innumerable synthetic dyes and drugs; the breeding of countless new varieties of food- and fibre-bearing plants, the discovery of many new metals and metallic alloys, the discovery of helium and other gases, the fixation of nitrogen from the air for the production of fertilisers, the production of oil from coal—

Mr. ALPASS

Is it in order for an hon. Member to read a schoolboy's essay on the progress of science?

Major CHURCH

A recital of the names of those on whose work the foundations of this country, and, indeed, of the whole world, have been built, seems to be a matter for considerable amusement among the party which pretends to have given so much care and thought to the cause of learning. [Interruption.] Perhaps I might quote to hon. Members opposite a short paragraph from Mr. H. G. Wells, in which he states his opinion that something far better can be done in the world in which we live than we are doing. He regards this problem as something which statesmanship should consider in the near future, something which might obviate some of the proposed economies of the Government. He says: In the last three centuries we have begun the surveying and mapping of the whole planet. After contours and topography follow geological surveys, biological explorations, climatology, economic appraisal. We are bringing all the material basis of human life into the sphere of the calculable. We are numbering the people. In quite a few years we shall know within quite small limits the population of the world and its rate of increase; we shall know within the limits of a few hundred tons its annual requirements of wheat and rice, steel and coal"—

Mr. W. J. BROWN

On a point of Order. Many of us on this side of the House cannot trace the slightest relevance between what is being said by the hon. Member and the National Economy Bill, and I shall be very grateful, Mr. Deputy-Speaker, if you can give us a Ruling on the point.

Lieut.-Colonel Sir FREDERICK HALL

Perhaps you are not aware, Mr. Deputy-Speaker, that the hon. Member for West Wolverhampton (Mr. W. J. Brown) has been incessantly—[Interruption].

Mr. DEPUTY-SPEAKER

That is not a point of Order. I was waiting to see how the hon. Member applied his quotation.

Major CHURCH

Perhaps I may just finish the quotation. It goes on: We shall know, within the limits of a few hundred tons, its annual requirements of wheat and rice, steel and coal, cotton and wool. We shall know how and where to get these and other staple commodities. We shall be able to work out the whole process of getting and distributing the material requirements of human life, upon lines, not of commercial adventure but of clear certitude. I submit that it is time that not merely this Government, but the Governments of the world, came to grips with the problem of distributing the material requirements of life upon something other than the present chaotic basis. My proposal to the present Government is that, instead of contributing further to another panic on the exchanges, instead of making the position of the credit of this country far more difficult by the continuance of the uncertainty with regard to the Government's attitude, the Government should show that they have something positive as well as something negative to do, and that they should at once, or with the least possible delay, make up their minds to give this House a chance to express its opinion with regard to tariffs—an emergency tariff of 10 per cent. on manufactured goods and, say, 5 per cent. on foodstuffs and raw materials—something which will be quite intelligible to the world and which will not contravene the commitments of this country with regard to its commercial treaties.

If this Government or the Prime Minister would call together, as I have already suggested, a seven-power economic conference, the principal nations of the world could face up to the realities in their own countries and the possibilities of disturbances among their own communities even worse than this which has occurred here and the recent disturbance in Germany. Let them face up these problems together, and determine that it is possible, not only to satisfy the material requirements of life, but to make life fuller and better for the peoples of all the nations; let them face this problem together as large communities, and give the world an assurance that the banking system of the world shall be brought into tune with the world's means and currency needs. At the moment we have, as the hon. Member for East Aberdeen said, two countries which seem to be in a position to hold up the rest of the world. We as a, country are assured by our own bankers, by our own economists and financial experts, that this country is extremely vulnerable, and that, if it dared to indulge in any of the schemes for the mobilisation of credit suggested by some Members of the Opposition, the credit of this country would be still further damaged and the country would probably never recover from the blow given to it.

Major HERBERT EVANS

I am sure the House will readily acquit me of excessive zeal in intervening in debate so very early in my Parliamentary career. I will promise to avoid anything of a provocative nature if I possibly can and will undertake not to follow the irrelevancies of the last speaker. Probably I occupy a happy position such as is occupied by a very few Members of this House, in having a mandate for what I am going to say with regard to some parts, at all events, of the National Economy Bill. It was my good fortune to face the electors of my constituency with this report on unemployment insurance thrown at me two days before the poll. Everyone who has been through an election will know what that really meant and the urgent need that there was for trying to make it clear that I was utterly opposed to the recommendations of the Unemployment Insurance Commission. I declared that I would pot support them in any circumstances, and I am glad of this opportunity of stating that I will vote against them not only on this occasion but on every occasion that it is my privilege to cast a vote in this Assembly. The Leader of the Opposition did me the service of mentioning the issue of a pamphlet by my opponent on this matter. I was confronted with the very serious charge that my party was responsible for not only creating the Commission but, therefore, for its decision. I had to face that. I made it quite clear what my action on the matter would be; 22,500 electors confirmed their faith in my undertaking, and I am here in personal evidence to carry that undertaking into effect.

There are one or two points in the Economy Bill upon which I desire to speak and which, I think, have not been touched upon in any section of the House. I am, first of all, rather surprised that, in their researches into avenues for economy, the Government have not tackled the problem of administration. Sitting in the Gallery behind your Chair, Sir, during the last 20 years, representing various Departments, I have often heard attitudes taken up which filled me with surprise at the considerable indifference shown by all parties to the great and important problem of administration. The legislative machine has its task to perform. Its output represents probably the wisdom of Parliament, but certainly the application of that wisdom is a matter that is left to the realm of administration. I am rather surprised that this new Government have not sought to relieve the present financial pressure which we all admit to exist by research into the hoary-headed system of administration. I am convinced that there is a very promising opening for economy in various directions, if that is the purpose of the research. I do not mean an economy that is going to cripple services. I mean economy which is going to assist administration and not make it more difficult. There are so many opportunities for economy in the realm of administration that I counsel even this admixture of a Government to look in that direction as soon as it can possibly find the time.

There are considerable overlapping agencies at work in all Departments of the State Administration: these have grown up a bit at a time, and very little notice has been taken of them. I have served under 23 Cabinet Ministers. These men come and go. They scarcely have time to understand the commitments of their Departments and, in consequence, the permanent staff has to maintain organisation that is quite unnecessary for present day purposes. If we are searching for economy, we could not do better than try to leaven up the agencies of the State that are charged with business administration. It is very difficult for legislators to give much attention to administration, but it is the thing that offers the greatest scope for modernisation. It is scarcely possible to mention any service that is not being dealt with by at least half a dozen Departments—a considerable overlapping which does considerable disservice to the State. The present Ministry, if it is to be called a Ministry, might do well in concentrating its attention upon some of these activities. I am sure they would be well repaid for their research. There is a considerable amount of overlapping in the State, too. If time permitted, I should like to regale the House with some good practical instances of overlapping which are costing the State a good deal of money, and which could, in my judgment, be largely saved, if there were the intention and desire to do so. There is a considerable overlapping in our services, the avoidance of which would assist the present financial position. I sincerely hope that, if no other word of mine carries any conviction to the mind of the House, my warning about the tendency to overlapping in administrative services may not fall upon deaf ears.

There are questions of general administration which I should like to touch upon, and which relate to the position in which we find ourselves, but, with so many desiring to engage the attention of the House, I think I could not do better than consult the convenience of the House by drawing my remarks to an early conclusion. But do not let the House conclude that because I do this now, it is going to be my regular custom. I am at this moment beginning to feel what is called terra firma. I have known the House most intimately for 35 years as an officer of a State Department and known many men who have distinguished its benches. I have been here when Mr. Gladstone spoke from the bench opposite, and from that time onwards have known almost every man who has taken any interest in Parliamentary life who has appeared in the. House. This is not the occasion to digress into things of that sort. The House is highly charged with a desire to get to close grips with the immediate problem, and I am desirous of sharing in that task.

The constituency which I have the honour to represent has an enormous mass of unemployed persons. The tendency, therefore, to limit resources which characterises the proposals of the present Government is very serious for the borough of Gateshead. [An HON. MEMBER: "Expenditure"] Somebody says, "expenditure." The man who has to depend upon 15s. 3d. per week does not have to consider expenditure. The money goes before he reaches that stage. On behalf of those, we regard this as a foul blow, a blow below the belt. I say, speaking on behalf of the unemployed men of my constituency, that it is a blow which no Government which respects the manhood of this country would attempt to inflict upon them, I say that because I represent a borough which has in it a very high percentage of ex-Service men. We were recruited in large numbers in the county to which I was sent at the beginning of the War to assist in recruitment and in which I spent my early days working in the mines. I pretend to know something of the men of that county, and I say, here and now, that this attempt to browbeat the unemployed by making this very heavy inroad into their slender allowances is unworthy of the British House of Commons.

I ought to have known, after my long experience in this House behind Mr. Speaker's Chair, that that might have been taken for a peroration. As a matter of fact, it was not intended as such, but I am quite prepared to take the hint, to thank the House for its patience and to promise to be a good deal more loquacious on the next occasion.

Mr. BUCHAN

My first and most pleasant duty is to congratulate the hon. and gallant Member for Gateshead (Major Evans) on a most interesting maiden speech. It was a speech characterised by so much modesty and lucidity that I am sure that any future contributions of his to our Debates, I hope at greater length, will be most valuable and welcome.

I have listened attentively to the discussions on this Measure in recent days, and I cannot feel that the speeches from the other side of the House have been very helpful. They have been largely concerned with recriminations between former Members of the late Government and Members of the present Government, a domestic matter in which it would be highly unbecoming for me to interfere. Except the hon. and gallant Member who has just sat down, they have not suggested any alternative scheme to this economy Measure, and they have not brought forward any very serious argument against the Measure as it stands. There has been, of course, the argument that any economies mean a loss of spending power and therefore an increase of unemployment. That is a perfectly sound point, but I think that there is an answer to it. That answer is simply that we were in a crisis which involved, unless some such measure was taken, a colossal loss of spending power and an enormous extension of unemployment.

For the rest, we have heard a great deal of melodramatic argument about the "bankers' ramp"—about the hidden hand of finance. Are my hon. Friends quite serious in that argument? They will remember that during the War we heard a great deal about the "hidden hand," a great deal in the newspapers and a great deal in London drawing-rooms, and there was nobody so contemptuous of that rubbish as hon. Members belonging to the party opposite—[Interruption.] A work of fiction is not a political argument. Really, I cannot understand this piece of melodrama from lion. Gentleman opposite. It is rather like the small boy who beats the barometer with his fists because the weather is bad.

Then I noticed in the speeches from the other side a curious note of Chauvism, of what I may describe as rather old fashioned jingoism. The late Financial Secretary to the Treasury made an eloquent speech last week which might have been made by the most crusted Tory in a remote rural parish. He declared that he was a sturdy Briton and would stand no interference from foreigners. I am amazed to hear that kind of talk from the Socialist party. I thought that the Socialist party, above all other parties, was sound internationalists. They are never tired of telling us that all nations are closely interconnected, and members one of another. Yet they seem to think that it is something degrading—"degrading" was the very word used by the late Financial Secretary to the Treasury—for Britain to be affected by the world movements of finance. They seem to think that it is a novel thing in our history for Britain to be liable to the repercussion of international movements and to have to set ourselves right with world opinion. And it is no new thing. In 1825 we had a case which is very nearly parallel. We had the same kind of fallacious remedy proposed, and no less a person than William Cobbett led an agitation to abolish the interest on the National Debt. There was a still more curious point. Recently in order to peg our currency we have had to get credits from foreign nations, but these foreign nations have been the allies with whom we fought during the War. In 1825 we had to get a peg from our enemy of 30 years. The Bank of England had to borrow £2,000,000 of gold—and that was a big sum in those days—from France, only 10 years after Waterloo.

I wish in the few words which I have to say to the House to deal only with one point. This economy Measure is an emergency Measure framed to meet a crisis which admitted of no delay. Obviously such an emergency Measure must be full of flaws. In a hurry you cannot consider nice questions of equity. Obviously, too, such a Measure must be taken as a, whole. You cannot alter any one part, because any alteration means that you must adjust every other part, and there is no time for that. If I may use the metaphor which my Noble Friend the late Minister of Education used last week, it is like the orders before a, battle. Once the battle is staged and the orders have gone out, even though they may be faulty, you cannot alter them, because any alteration would put the whole thing out of gear. That, I understand, is the argument of His Majesty's Government, and I think it is a sound argument, and I am prepared to accept it.

At the same time, it is most important to point out and to emphasise what we regard as points of unfairness. And for this reason. These economies are going to cause a great deal of hardship, and that hardship will be enormously increased if any class feels that it is being unfairly treated, that it is being asked to bear more than the burden placed upon other people—if, to adopt an excellent phrase used in a Scottish meeting on Saturday, instead of equality of sacrifice, there is sacrifice of equality. But if you frankly admit the injustice, and justify it only on emergency grounds, then you give a guarantee that this injustice will be removed as soon as things get better.

The point that I want to emphasise is the cut in the salaries of teachers. I admit that there is every justification for saving in education expenditure—on administration, on new buildings, and in many other ways. In many directions we are spending money without getting full value for it. But I do not think that is the case with the teachers' salaries. This is not a case out of which anyone is entitled to make party capital, because this side is responsible for the cut and the leaders on the other side had accepted it. [HON. MEMBERS: "No!"] I do not want to argue the point at length, because it has been fully dealt with by other speakers, but I would emphasise one or two facts. Before the War education was a grossly underpaid and sweated profession. During the War the teachers made no demand for revision. They accepted a most difficult situation, and as I know from personal experience many of them were very hard put to it to make ends meet. After the War the Burnham Committee established basic scales to make amends for an old long-standing injustice in regard to pay. The essence of the Burnham scales was an attempt to establish a fair living wage for what was admitted to be a profession of great public importance.

I cannot but feel that the May Committee was singularly unfortunate in dealing with this question. The Burnham scales, as the May Committee did not understand, had nothing whatever to do with the cost of living, and it is absurd to do as the May Committee did and bring the salaries of the teachers before the War into the argument. Those salaries were admittedly preposterous. In those days the average teacher in an elementary school only got about 36s. per week. What does the 15 per cent. cut mean? I understand that the average pay in an elementary school is £245 a year, and that includes 30,000 head teachers, who have much higher salaries.

Mr. MACLEAN

The teachers are not the only ones who are being cut.

Mr. BUCHAN

No, but I am dealing with their case.

Mr. MACLEAN

This is the third speaker who has dealt with the case of the teachers.

Mr. BUCHAN

The reduction of 15 per cent., together with the 5 per cent. for pensions, means that the average salary of £245 will be reduced to £198, or less than £4 a week. That is the average, but there will be many teachers who will get less than £2 a week. Is that a fair and reasonable wage for men and women who are doing work of great national value? Is it a fair and reason- able wage for people whose expenses for their preparatory course are considerable? I admit that a large part of that is paid by the State, but during their period of preparation they are not earning money. Is it a, fair and reasonable wage for what we are bound to regard as a liberal profession of the highest importance? I cannot believe it. It seems to me that we are in grave danger of cutting off the recruitment of the best kind of teachers, and we are in serious danger of lowering the status of a profession which it is our duty rather to exalt.

There are some words that I should like to quote from my, old friend and predecessor in the representation of the Scottish Universities, Sir Henry Craik. Sir Henry was no spendthrift, for he was an old-fashioned and austere type of economist, and he was assuredly no faddist. He said: We have to curtail expenditure and to practise economy in our schools and elsewhere, but we cannot, with culpable neglect and wilful blindness, starve those who constitute the vital element in school work, or refrain from offering to them those incentives that can attract to it its due share of the moral and intellectual forces of tile nation. This is an emergency Measure and can be justified on emergency grounds. It can hardly be changed, because it is the nature of this kind of Measure that if you once try to alter it you are apt to whittle it away altogether. But I would like to point out and to emphasise what appears to be a very genuine case of hardship. And I should like to appeal to His Majesty's Government frankly to repudiate the false reasoning on this point of the May Committee and to admit this unfairness. By doing that they will give some kind of assurance to a patriotic and honourable and hard-working and still underpaid profession that as soon as the ship of State comes into easier waters this anomaly will be the first to be revised.

Mr. BUCHANAN

I rise to criticise the Bill. One is inclined to feel rather irritable. The only proposals so far that seems to have been criticised is the proposed cut in the salaries of the teachers. I recognise that there is a great deal of weight behind that criticism, but it seems to me terrible that a comparatively small number of people such as the teachers should receive so much attention, when 2,750,000 unemployed and their wives and families are also concerned, and yet they seem scarcely to have a spokesman in these Debates. That section to-day cannot find one spokesman on the Government side.

I want to direct my remarks to the unemployment side of this question. So far, the Government have made no attempt to defend their proposals. They have rested their defence, first on a national crisis and, in the second place, they have blamed their predecessors. There has been no defence for these proposals. I listened to possibly the ablest spokesman for the Government, certainly everyone who knew him in the Labour movement knew him as the cutest debater in our councils—the Secretary of State for the Dominions. He made no defence of the proposals. He only said that they were agreed to by his late colleagues and that, therefore, they were right. Let me examine the two propositions. First, as to the crisis. I may differ from some hon. Members on this side of the House, but when I am asked to consent to terrible alterations in the conditions of the poor people of this country I am entitled to ask for the evidence. It is not sufficient to say to me that there is a crisis, and that the £ is going to fall. You must produce the evidence. All the evidence so far produced is that hon. Members opposite say that there is a crisis. The reason why the word of the Secretary of State for the Dominions is accepted is because hon. Members want to believe that he is right. No evidence has been adduced. All we are told is that the £ is in a bad way; that we are facing a crisis, and, therefore, this must be done.

The other reason given is that the Labour Government were committed to it. I did not agree with the late Government in all their proposals and I say quite frankly that they cannot escape a certain amount of responsibility. The May Committee was set up by the House of Commons, and there was also the Anomalies Bill, which was a tax upon the unemployed, indefensible and cruel. It could not be defended from a moral or human standpoint. But that is no defence for these proposals. It is not enough to say that somebody else should be in the dock. The issue we are discussing is an issue which affects the masses of the people. The hon. Member for Aberavon (Mr. Cove) in his very able speech put the position of the school teachers and education generally. If that is true, what about the position of the unemployed? Look at the White Paper—and I am surprised that no Member of the Government or on this side of the House has mentioned this. The White Paper is issued on a basis of 3,000,000 unemployed, an increase this year of 750,000. Last year the figures were 2,750,000, but they started a year back. The first act of this Government, which is to save the nation and put it on its feet is to increase the average of unemployed by 750,000. It is not merely putting the figure up to 3,000,000, you must also take into account the large number of unemployed who will be taken off the register.

Let me assume for a moment that the pound must be saved; does this save it? Is there any hon. Member opposite who for a moment thinks that with 3,000,000 unemployed and on the point of starvation you will regain the confidence of the world?

Mr. MACQUISTEN

Not with a Labour Government.

Mr. BUCHANAN

Would you get it with any kind of Government with 3,000,000 unemployed? You may stave it off for a few months or a few weeks, but inevitably it comes back again with the condition of the workers further reduced and your financial situation still in the same position. I look at these proposals to save from the unemployed about £30,000,000 of money—from an unemployed man getting 15s. 3d. per week! The Prime Minister in his speech referred to 11½ per cent.; Shylock, the money lender, could not have been any more miserable in counting up the interest payable by his clients. I have been in most scenes in this House. I listened to the Debate on Friday, and the scene at a street corner was really nothing to the scene on Friday. One side was throwing millions at the other, and they were throwing millions back, arid behind every million that was thrown were the unemployed man and his wife and family. That is the issue to-day. I agree as to the conditions of the teachers, but will the hon. Member for the Scottish Universities (Mr. Buchan) deny this, that if you put the teachers' wages hack is it of any use in my Division if the children are not fed?

This is the position. A man gets 23s. 3d., but next week, the day when this Bill comes into operation, the coal merchants have notified winter prices—2s. for a bag of coal, 8s. for rent. That is 10s. If there are four in family they get 27s. 3d., and two bags of coal make it up to 12s. Talk about equality of sacrifice! And the King makes a contribution! I have heard about what the Prime Minister and the Chancellor of the Exchequer have given to the Labour movement. Some of us have been in the Labour movement. I have had far more from it than ever I can give it, but these right hon. Gentlemen have got far more. The movement has given them place and power and privilege. The first thing that it told them was to alter the system, but, secondly, in altering the system to see that abominable poverty did not weigh on the poorest of the poor. £28,800,000. I am not a business man, for I still belong to the poorest of the people, but will the House answer this question? There is a war debt costing £300,000,000 in interest to-day. I am told that that is worth £114,000,000 more than it was worth 11 years ago. Is that denied? £114,000,000 more! What is wrong, then, with the stability of the nation? Instead of taking the £28,800,000 from the poor, the State could have taken £28,800,000 from that huge total.

Mr. MACQUISTEN

It is coming.

Mr. BUCHANAN

It is coming, but why not now? Why not at first? If the hon. Member was running the business and seeing squalid poverty hitting men and women, would he not have chosen the better way? Is there anything wrong that it cannot be done? Is it said by anyone here, as I have heard it said, "Al, we may ruin the pound and kill confidence?" I know that the Minister of Labour as an individual would never take the course that the Government propose. In many ways there is not a kinder man than he is. I would like him to come down to my place and to walk through the streets and lanes. He would then never do this thing. But he is going to do it on a community basis, though his whole heart revolts against it. Consider two issues raised in this Bill—unemployment and education. The great bulk of the Members of this House would not vote for these proposals if they were free as individuals. I challenge the Minister of Health, who is going to reply, to let us have a direct vote on the 15s. 3d. and the 8s. Even some of his Tories would rebel against him. The Liberals too would rebel. [HON. MEMBERS: "Question."] Surely decency has not gone west yet.

The Government cannot trust the House. They must force through their proposals by other means. It has been said that the Bank of England has had no part in this scheme, but I read in today's newspaper a speech by the late Secretary for Mines, who stated that the appointment of the chief of the Mines Reorganisation Department at £7,000 a year was forced, not by the Government, but by the chief of the Bank of England. Everyone on this side of the House knew what was going on for years. Some were prepared to tolerate it, but I was not. For two years the Chancellor of the Exchequer has not been the servant of the Labour party at all. He stood up at our party meetings and said to us, when asking us at one time to vote for a reactionary proposal, "Just do it, Comrades. I am in touch with leading business. In six months trade will improve." That was nearly two years ago. Yet this man is now taken as the chief apostle that the pound is safe. His policy for years has been a policy of Conservatism, placing rigid finance long before the lives of the common people. He may have served his party, and he did, but he and: he Prime Minister are away from the common people. They could never talk about threepences if they were not. We must fight this Government free from the entanglements of the past, and with absolute ruthlessness, because in no way does the Government, either in its ex-Labour Members or its present Tories, differ from the most contemptible and cruel Government that ever governed this country.

9.0 p.m.

Dr. BURGIN

The House has listened, as it always does, with the greatest interest to the hon. Member who has just spoken. He has addressed the House with his accustomed sincerity, and has done the great service of bringing us back to the point which separates the two sides of the House. I want to put this question to him. He has addressed a great part of his remarks to the 15s. 3d., the 1s. 9d. deduction from the 17s. unemployment benefit. Would his speech have been just the same whatever the deduction had been from the 17s.? Is his point that there ought not to be anything at all taken from the 17s.?

Mr. BUCHANAN

I see that there is great annoyance because the Prime Minister is going to be excluded for opposing his party. The hon. Member knows that I would have opposed my party if they had taken one penny off the 17s.

Dr. BURGIN

I was not asking about the Prime Minister. I wanted to understand the hon. Member's point and whether he went so far as to say that the unemployed whatever their number—and we all regret that the total should be growing—should in fact make no contribution at all.

Mr. LOGAN

If you were living on 17s. 3d. you would say so too.

Dr. BURGIN

I am only putting the question. The whole object of Debate is that the different parties may endeavour to understand what is being discussed and by means of this question and answer I have learned exactly where we stand. We are a mercantile and a maritime nation and very frequently in order to save an adventure something has to be jettisoned.

Mr. MACLEAN

Would you jettison the unemployed?

HON. MEMBERS

What about the interest on War Loan?

Dr. BURGIN

I propose to make my observations in my own way. The "general average contribution" is quite well known in the City of London. In order that the adventure may succeed, in order that the ship may be saved, the owners of the ship, the owners of the cargo, those who would have profited by the adventure and all the parties interested make a contribution which is known as a "general average contribution" to the general average loss. Those who decide whether or not the moment has come to make the general average contribution are those in command of the ship, and the incidence and amount of the contribution are left to average adjustors and other learned persons.

The hon. Member for Gorbals asked for evidence of the crisis. He said it was not enough to be told that the pound was in danger of slipping and that had certain buttressing measures not been taken, the pound would have slipped. In common with other Members of this House I was in France when the franc went. I was in Austria when the krone went, and in Germany when the mark went, and I know that certain signs preceeded the fall in value of those currencies. I can tell the hon. Member for Gorbals from my own personal knowledge, that some of those signs were unmistakably present in the City of London in the month of August. You do not as a rule advertise that there is a run on your own hank. Credit and confidence are remarkably tender plants. They can be withered overnight by a chill blast and the fact that a crisis, grave in character, was imminent is a matter of which it is not necessary to give evidence on the one side or have admissions on the other. It is a fact of which judicial notice would be taken.

The hon. Member for Gorbals (Mr. Buchanan) and other Members on the Opposition side, in referring to the economies proposed under this Bill at the expense of the unemployed are rather arrogating to themselves the task of spokesmen for the interests of the unemployed. I claim to represent the unemployed in my constituency as much as hon. Members represent the unemployed in their constituencies and I think that it is a libel on the unemployed to suggest that they are not willing to contribute with the rest of the community. [Interruption.] I repeat that statement. I think it is a slur to suggest that the whole number of the unemployed, who belong to all classes of our people, and to all political parties and to none, are not willing when facts and figures are clearly put before them, to make their contribution to the national requirements. The extent of it is a matter of discussion.

Mr. LOGAN

Would the hon. Member defend 15s. 3d. a week for a man to live on?

Dr. BURGIN

No one is defending 15s. 3d. a week for a man to live on. I started by making it perfectly clear that if the choice before the unemployed man who in certain circumstances receives 17s., is whether he is to agree to receive 15s. 3d. in some circumstances or risk the 17s. dwindling in value—if that is the choice—[HON. MEMBERS: "It is not!"]—If that were the choice, I say that the unemployed would be prepared to consider the facts and certainly would not adopt the blind Canute-like attitude of "seventeen shillings and not one penny below it." It is a question of quantum, not a question of principle. It is a question of amount. It is a question upon which no one can form a judgment until the whole facts have been placed before him. Unfortunately the facts are known to few and are by them disputed. The only point I want to make on unemployment is that those on this side claim also to represent the unemployed.

Almost all the points with regard to education have been fully covered by the speeches of the hon. Member for the Scottish Universities (Mr. Buchan), the hon. Member for Aberavon (Mr. Cove) and others who have preceded me, including the right hon. and learned Gentleman the Member for Ross and Cromarty (Mr. Macpherson), but I think we ought to say that when one looks at a balance sheet, one does not look only at the liabilities or at the economies which can be effected. One looks also at the assets and this country is proud to have among its greatest assets a magnificent body of teachers who are zealous and loyal and willing to give of their best. Hon. Members in this time of strain will not be led astray because there may be in their post bags letters with which they disagree or because there may be unfortunate observations in the Press. These do not represent the feelings of teachers as a whole.

There is no more loyal body of servants of the State than the teaching profession. [An HON. MEMBER: "Why not give them a square deal?"] Certainly, and I am going to make an appeal to the President of the Board of Education. Whatever may be said about the main pillars of the Economy Bill not being touched, I ask him to consider whether he might not take the teachers into his confidence. The May Committee drew wrong conclusions in this respect and their report is not accepted, but neither the fact of the May Report nor the fact that the late Government were prepared in certain conditions provisionally to accept certain figures, justifies the cut. Those facts are not relevant, but the teachers would be quite willing, if the whole of the circumstances were explained to them, to see what they could do to meet the national needs, and may I ask the President of the Board of Education to consider this fact? It is undoubtedly of great importance that the value of the pound sterling should be kept intact. It is also of some consequence that the value of a Government undertaking should be kept intact. In 1925 His Majesty's Government, through the then President of the Board of Education, gave an undertaking that certain scales should be maintained for a period of time. It is essential that the importance of that undertaking not being fully kept should be present to the mind of the Government. A great deal of uneasiness and of anxiety would be dissipated if the President of the Board of Education would take the teaching profession into his confidence and make quite clear to them some reason why a Government undertaking given now is a more value than a Government undertaking given in 1925.

We have to face the fact that the Government undertaking of 1925 is rot going to be fully honoured, and if the President of the Board of Education, recognising the existence of the negotiating machinery, will take the teaching profession into his confidence, he will find response and he will find willingness, but let him bear in mind that teaching is a very wearying job. I have not been a public teacher of law for over 20 years without knowing sonic-thing of the necessity of the teacher to refill the tank, to study, to equip himself for his task, and nobody can pretend that teaching in this country is going to be improved by teachers being subjected to a strain all round. It may be too late to question the total aggregate of the education economies, but it may not be too late to appeal to the President to consider, administratively and by action within his power, hew that total is to be arrived at and over what period of time. Why, if the police cut is to be in two instalments, is the education cut all to be made as from the 1st October? Cannot the President of the Board of Education at this time take the teachers into his confidence and, by powers which he possesses, render this cut, drastic and, as we consider, excessive, more tempered to the shorn lamb and more possible of general acceptance?

Mr. MARLEY

I want to appeal to the hon. Member for Luton (Dr. Burgin), who has just sat down, not to make so much of an appeal to the President of the Board of Education, but to take his courage in his hands, follow the temper of his own speech, and vote against the Economy Bill. There has been nothing more disgusting to me, apart from allusions made to what may have been accepted by our own Front Bench here, than hon. Members opposite saying, "How much we sympathise with the poor teacher; please do something for him, as we would not dream of voting against this Bill in order to get the teacher out of his difficulty." All this has been worked upon the assumption that there was any need for this Economy Bill at all, and that there was no alternative but to come and cut everyone. There are hon. Members opposite who have said, "You people cannot say anything because you were prepared to do the same." It is like the burglar caught with a poor unemployed man's margarine in his pocket, who said, "Don't blame me for burglary, because I heard a rumour that somebody else was going to do it if I did not do it. If hon. Members opposite are trying to ride away with the idea that because certain people on our Front Bench may or may not have agreed to these cuts, I want to assure them that if they had so agreed, this party would have repudiated those leaders at once.

I want to ask the Chancellor of the Exchequer a very simple question. In the Budget which he presented the other day, he has increased direct taxation by 6d. in the £ and Surtax by 10 per cent., but he told this party and this House, on his Budget in April, that the limit of direct taxation had been reached, that we had reached the stage of diminishing returns, and that any further increase of direct taxation would ruin the country and destroy the reserves from which capital came. Has anything changed since then? Have we a different situation? According to his own report, he is likely to get less and less, as capital is so depleted, but now he can find an extra 6d. from the Income Tax and another 10 per cent. from the Surtax. When some hon. Members on this side asked it in order that the unemployed should get more, it could not be found, nor could it be found for the schemes which were put forward by the Liberal party.

Has this crisis developed suddenly? Did it come on immediately during the recess? Was there no forewarning of this crisis? Certain people evidently had some forewarning of it, because they suggested in February that there ought to be a National Government and that Mr. Ramsay MacDonald ought to be the head of it. [HON. MEMBERS: "Order!"] I am quoting from the "Observer," which said that there would be no doubt that, if approached, Mr. MacDonald might be prepared to become the head of such a Government. We are not faced with a sudden emergency; and, if we are, what are we told? We are told that the credit of this country is so low that we cannot borrow further all over the country, that we have to go for a loan to the United States and to France. We are to go to France, a country that has repudiated its debt to the extent of 80 per cent., a country that has compounded with its creditors for 4s. in the £. That is international finance, and we are to go to a country like that for assistance.

It sounds more like the activities of a diddle 'em club than international finance. We are told to believe that we are in such an emergency that France, which has repudiated her debt to the extent of 80 per cent.—and the hon. Member for East Aberdeen (Mr. Boothby) said she was wise in doing it—can help us. We are told that international finance is so obsessed with the credit of France and with our own financial instability that France will lend us this money for an international loan. [An HON. MEMBER: "She has done it."]—Yes, on the terms of 6i per cent., and 89 per cent. of it subscribed by the issuing houses and companies of this country.

Mr. P. SNOWDEN

That is absolutely untrue.

Mr. MARLEY

That is according to the information that I have, and I think, if my right hon. Friend refers to his own statement, he will remember that he said that 60 per cent. of it was a bankers' loan. I am informed that 69 per cent. has been subscribed by people in this country.

Commander SOUTHBY

Totally wrong!

Mr. MARLEY

I want to ask this very simple thing. If we had to descend so low as to cut the unemployment benefit, was there no other resource in the country that could be equally taxed? We are told by the hon. Member for East Aberdeen, and by practically everyone in this House who opposed the Chancellor's gold standard policy, that hanging on to the gold standard has increased the share of the bondholders in this country by 60 or 70 per cent. in the last 10 years. In other words, the gold standard and the payment of War Debt interest at the present rate has increased their holding in this country to that extent. But they are not compelled to make sacrifices; they have to be asked. As the Irishman says, "You axe one and you axe the other," but in their case it means that you ask them. We are told that we cannot say to investors, "We are in a difficult position, and will you accept a lower rate of interest? "We are told that we cannot do that because we would get no more advances. Did France do it? We are told that, if we had not got this loan in France, the pound would have gone off the gold standard. International finance would not have let the pound go off the gold standard for a minute. At the suggestion that Germany was getting into trouble every financier in the world rushed to see how Germany could be helped. Yet we are told that the greatest financial country in the world was to be allowed to collapse. I was in Germany at the time of the inflation and, if the only alternative, in order to get rid of the bondholder, was to allow the pound to go off the gold standard, I would do it to-morrow. I know that the middle-class was hit, because I saw what happened, and I am speaking as one of the middle-class. If you did that, your unemployment would vanish, although it is true you would not get rid of your difficulties and would go back to the same difficulties afterwards. But the result in Germany was that the bondholders to the extent of 95 per cent. were wiped out.

There are two other matters I wish to put to the House. The Chancellor of the Exchequer has always been a believer in the gold standard. He has believed that this country ought to keep upon the gold standard at any sacrifice. If there is anyone on the other side of the House including the Chancellor of the Exchequer, who will tell the House definitely that these cuts and economies are going to save the country, then we may be able to accept these sacrifices with equanimity. There is, however, no guarantee that these cuts are going to save the pound. We are told by people who know finance intimately that this is a further deflationary process and that, by restricting the amount of public expenditure and the amount of money circulating in the country, you are further deflating and that this will be followed by a drop in prices.

These economies do not touch the actual cost of production of any manufactured article in the country. In point of fact, the additional taxation proposed by the Chancellor of the Exchequer will tend to increase the cost of manufacture. It is not going to help you at all in the competition in the world market. You are diminishing your home market without any diminution in production costs, and you are going to increase unemployment in this country through deflation. In other words, we are getting further stuck on the gold standard which we had a chance of getting off and gaining a little prosperity before this ramp. Have we not got men with sense and courage who will say "We will not hitch ourselves to this gold standard"? The first question I asked in this House seven years ago was if anyone had ever seen this gold standard, and if they would bring it in so that we could look at it. The result of the gold standard is that two countries on the gold standard are so held up that they cannot exchange goods by means of it. We are told that Brazil and the Farm Board of America have exchanged commodities against commodities, which could not be exchanged by the American currency.

Can the Chancellor of the Exchequer say to the unemployed man and the teacher that this is only a temporary sacrifice and that they will get it back later? Can he assure us that this is the end of the sacrifices, and that we shall not have other demands for further economies made in a few months' time? is he sure that, when we have balanced our Budget and put our House in order, there is going to be no more unemployment, no more destitution and a revival of trade? There is no such guarantee forthcoming, and the Chancellor of the Exchequer has gone back on almost everything he has said in his life. He told us, as members of the party, to remember that there always was a source of wealth from which expenditure of this kind could be found, and that he knew where to find it when he had the time and the power. Teachers, police and unemployed—every dog in the way of the Government to kick they have kicked. It was not because they wanted to vent their spleen on that particular dog, but because it was in their way. There are other dogs to be kicked yet, the railwaymen, and the other sheltered industries who are said to be getting more than their share. The Leader of the Conservative party, the right hon. Member for Bewdley (Mr. S. Baldwin), said that the wages in sheltered industries would have to come down. After all these sacrifices, there is still no guarantee of an increase in trade and of getting back to prosperity. The right hon. Member for St. Ives (Mr. Runciman) cannot guarantee that after these sacrifices we are going to have a revival in trade, that we have seen the last of these economies, that there is going to be no further call upon those who can least afford it to give generously, or that a further process of deflation will not be necessary to keep us on the gold standard. We have hitched the waggon of international finance to a star, and we have dragged the poor people all over the world barefooted and lacerated after its chariot.

Sir GERVAIS RENTOUL

The hon. Member for North St. Pancras (Mr. Marley) made one remark of significance. He said that, if the present Front Bench opposite had accepted these proposals, they would have been repudiated by the whole of the party. The Home Secretary remarked earlier that the present situation was a test for democracy. Certainly to anyone who believes that the democratic system of Government, with all its faults, is nevertheless the best that human ingenuity has yet devised, the attitude of hon. and right hon. Members opposite, and the kind of speeches to which we have listened during the past few days, are distinctly disheartening, because there has been a refusal to face the stern facts of the situation, coupled with a spirit of irresponsibility in some quarters, and of apparent levity in the face of one of the greatest crises which this country has ever been called upon to meet.

What is the position in which we find ourselves to-day? The existence of the crisis is now generally admitted. [HON. MEMBERS: "No!" It certainly was admitted by the Leader of the Opposition. It has been admitted by many of those who have spoken on the other side of the House, and it is certainly admitted by most responsible and thinking people in the country. It is, moreover, a crisis of the utmost magnitude and gravity which can only be met and overcome if the most urgent and drastic steps are taken. Unless that is done, the whole nation may well be involved in common ruin. I agree with the hon. Member for Luton (Dr. Burgin) that of those facts no proof seems to be necessary to anyone who has attempted to study the situation. The fact of the matter is that it is a situation in which long-distance remedies are for the moment of no avail. That fact seems to be lost sight of in some of the suggestions that have been put before the House. For example, there was the suggestion that the vexed question of teachers' salaries might be referred to the Burnham Committee or some form of arbitration, without any regard to the amount of time that that would take. Weeks and possibly months would be involved at a moment when it is almost still a question of hours.

Mr. EDE

Still?

Sir G. RENTOUL

Yes, because we are not by any means out of the wood yet. [HON. MEMBERS: "Hear, hear!"] I do not think that anyone on this side of the House would deny that. We are still in the midst of the crisis and a situation of the utmost anxiety is still in front of us. The disease has reached the stage when the surgeon and not the physician is required. There is no time now to discuss the origin of the matter.

There are only two possible ways for the moment in which we can hope to bring immediate relief—economies and taxation. The latter has been dealt with in the Budget statement, and we are now discussing the former. To all of us—and no one on this side of the House has ever attempted to dispute it—the economies and the cuts that are now proposed are terribly drastic and disagreeable. There is hardly one of them for which we would have voted if time had been normal and if we had not been forced by the necessities of the situation. What is the alternative Even the late Government were compelled to accept in principle nine-tenths of the economies that are now proposed, including, as we know, and as cannot too often be repeated, even this drastic 15 per cent. cut in the teachers' salaries; including also, as we have heard, certain cuts in unemployment relief.

HON. MEMBERS

No!

Mr. McKINLAY

If you say that often enough, you will believe it yourself.

Sir G. RENTOUL

I am not saying it. It was said by a member of the late Government, the Secretary of State for Dominion Affairs, on Friday. He pointed out very clearly that there were certain cuts, and he defined them in his speech. He pointed out that everyone must admit that if people received less than they were having, it was a cut. He asked, What is the reduction to 26 weeks but a cut, and what were the other proposals in regard to unemployment benefit but cuts? Therefore, in principle the members of the late Government—no one suggests that they did it willingly—were compelled by the facts of the situation to face up even to cuts in unemployment relief. It is true that a certain number of them ran away, or, if that phrase be objected to, repudiated responsibility when they began to realise how intensely unpopular these cuts were likely to be with the people affected. They ran away in the same way as the rank and file opposite are now repudiating responsibility for what we know their present leaders accepted when they were in a position of greater responsibility for national requirements, and less freedom to consider their personal and party advantage.

With regard to the present Bill, I feel very strongly that there is no alternative, however much we may hate the prospect, but to accept its proposals as a whole. You cannot upset at this eleventh hour the balance of the whole scheme. If we start tinkering in one direction, we are bound to do it in another. I submit that as far as it was humanly possible, the Chancellor has endeavoured to adjust the sacrifices demanded equitably over the whole population. Of course, complete equality of sacrifice is impossible. [HON. MEMBERS: "Hear, hear!"] May I appeal to hon. Members opposite to apply their minds to the facts. However desirable equality of sacrifice may he as an ideal, it is impossible to achieve it with mathematical accuracy. These sacrifices are being demanded from all classes of the population. Who is to measure exactly what those sacrifices amount to? The right hon. Gentleman the Member for Miles Platting (Mr. Clynes) attempted—although I should have thought he was too old a Parliamentary hand to embark on such a risk—an excursion into the art of definition. He said that a sacrifice meant going without something you need as opposed to something that you want. I suggest to him that that definition entirely begs the question, because what are really one person's necessities may be luxuries to another. [HON. MEMBERS: "Oh!"] A motor car may be a luxury, and no doubt is to a great many people, but to a doctor in a busy practice it will be a necessity if he is to carry on his work of healing. A thousand similar illustrations could be given, and I suggest that all classes in reason are being called upon to make a direct contribution.

We have heard a great deal about the teachers during the Debate. We have all been subject to an intense amount of lobbying on behalf of the teachers. I make no complaint or objection whatever to that, because it is a vitally important matter. Some hon. Members opposite object to anyone on this side of the House expressing sympathy with the teachers or with the unemployed or with anyone else affected by these economies. [Interruption.] Certainly. I have a great amount of sympathy with the teachers. What is the alternative? I have not only received a very large number of letters, but have had the opportunity of discussing the position personally with some of the teachers in my own constituency. The impression left on my mind as a result of those discussions is that the teachers, when you talk over these matters with them, are a great deal more reasonable and patriotic than some of those who claim to speak on their behalf in this House; but there are one or two ways in which, I would submit, the position might be somewhat ameliorated.

I suggest this as a result of representations that have been made to me. Firstly, I think it would assist the position if it could be made clear that these cuts are an emergency measure only. It has been repeatedly emphasised that all these economy proposals are emergency proposals, but if a definite assurance could be given that this is not regarded as a permanent reduction for all time, and that whenever the circumstances of the nation permit, the position will be reconsidered and restored—if that assurance could be given, without, obviously, pledging the Government to any particular time, because it is obviously impossible to do that—it would do a great deal to reconcile the teachers to the present position. Secondly, I would ask the Government whether this 15 per cent. cut could not be scaled in some way as between the higher and lower paid classes of teachers—without interfering with the financial requirements of the Budget. [Interruption.] My time is short, and I am trying to put forward a few considerations which are regarded as of first-class importance by a large number of teachers in my constituency. Some discretion might be given to the Board of Education and the education authorities, in accordance with the statement made by the Prime Minister on Friday that when an instruction is given to a Department to save a certain sum that does not necessarily mean that it must be saved in any particular way so long as the total saving is achieved.

Thirdly, I feel the position with regard to superannuation allowances needs to be made a little clearer, and I ask whether some further assurance might not be given about that. I promised to sit down at a certain time, and I intend rigidly to fulfil my undertaking, but I would say in conclusion that I do believe that there is not only every justification for this Bill but that in the circumstances no other course was open to us. The steps taken during the past few days in facing up to the stern necessities of the situation have won for this country, as we know, the admiration of the world, and every credit ought to be given to those who stood by the Prime Minister and who did not shirk their share of responsibility, or put private, personal or party interests above those of the nation or its hour of trial.

Mr. LANSBURY

I think I must do something which I had not intended to do, that is, say one or two words on the personal controversy which has taken place. I should not have done so had I not had handed to me a statement that the Prime Minister this afternoon told a deputation of unemployed people that every Member of the Labour Government had agreed that benefits should cease at the end of 26 weeks. He said no Member of the late Government had opposed it. I only want to say that if that statement is accurately recorded there is not a vestige of truth in it. [HON. MEMBERS: "Where is the Prime Minister?" The next thing I want to say regarding all the statements that have been made about these proposals is that my late colleagues who sit opposite know per- fectly well that there was never unanimity in the Cabinet. They know perfectly well that because there was not that agreement every proposal was sent forward tentatively, to be finally decided at the end. About that there can be no dispute among truthful men. [Laughter.] There is a great deal of hilarity on the part of certain hon. and right hon. Members because these differences have shown themselves among men who were formerly colleagues. I suppose there are men in this House who have read the story of political parties during the last 100 years, and they will know, from the time of Sir Robert Peel verging towards Free Trade down to the time when the father of the right hon. Gentleman who is to close this Debate left Mr. Gladstone in 1886 that when these men met in Debate afterwards there was always great controversy as to what they said, what they believed, and what they did, when they were in the Governments which they had left. The father of the right hon. Gentleman uttered this very simple saying in this House one day when he was being rebuked: "What I have said I have said."

The MINISTER of HEALTH (Mr. Chamberlain)

indicated dissent.

Mr. LANSBURY

Well, if the statement was not made in this House, it was made by him elsewhere in answer to criticism similar to that which has been applied to us. I want to say this—that in a Cabinet, at least in the one single Cabinet that I know anything about, there are never votes in the ordinary sense. The Prime Minister, like the clerk at a Quakers' meeting, takes what he considers is the conclusion, and men who disagree have the choice of either acquiescing or resigning from the Cabinet. Every ex-Minister who has resigned has claimed the right to put his own view as to the case on which he resigned and general policy, and that is all I want to do in this controversy, That is what I intend to do.

From the first I have taken a heterodox view of this crisis. The right hon. Gentleman the Member for Epping (Mr. Churchill) uses much better language than I can use, and the substance of what he said the other night has been stated by me in public and private over and over again. This country is not a poor country, and since the War it has stood up to every obligation which it has entered into or was called upon to enter into. We have paid away more money than any other nation, and while other nations with whom we fought have forced us to forgive their debts, or part of their debts, while other nations have paid some of their creditors who are our nationals at the rate of £10,000,000 for £50,000,000, Great Britain has paid and met every one of her obligations, and I refuse to accept at this time of day the argument put forward by hon. Members opposite that this £12,500,000 cut required for the unemployed is the only obstacle to securing loans from abroad.

10.0 p.m.

I refuse to believe that international financiers would have allowed the pound to slump for a, reason like that. Great Britain to-day is one of the greatest creditor nations of the world. Nobody will deny that fact, and for us to be told Chat this great nation must, at the bid- ding of Mr. Montagu Norman, and men in America, people with whom we never come in contact, accept their terms, is to tell us that we do not know how to manage our own domestic affairs. The social services of this country have been the subject of attack, not only here but elsewhere. It has been said that people abroad were afraid that this nation was living beyond its means and that we should not be able to pay our way. I would like someone to tell me in what particular quarter of the globe there is any danger—I am not talking of Great Britain's moneylenders, but I am speaking of Great Britain as a nation—of us defaulting in our payments. We paid America every penny which is due to her on the day it was due. Anyone would imagine that the people who talk and write on this subject were some sort of supermen. The unfortunate thing is that no two of those men agree about anything. It has been my painful duty to study what the various committees have reported. I am not going to give away any of their secrets, but I am, entitled to say that a large number of the reports of those committees are the views of experts who have been appointed to deal with those particular subjects, and their reports cancel each other out.

I want to look at this question as an ordinary person. The thing I discover is that, in this world of finance, the gentlemen who manage things in the City are exactly what the right hen. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) said about them in a famous speech, they are a muddle-headed lot of people. The financial geniuses who govern finance in this country, and whom we are told keep us going, are the gentry who allowed money to go out of the country at a time when they were being warned that money ought to be kept in the country because of the difficulties that would arise in Germany. Everybody knows that. The Chancellor of the Exchequer knows it much better than I do, but it does not suit him to acknowledge it. The right hon. Gentleman knows that it is perfectly true that many moneylenders in this country have borrowed money to lend to Germany, and they borrowed as they say short and lent it long. When Germany appeared to be on the point of collapse, these people were called upon to pay up the money. Perhaps we shall now be told what the drain of gold really consisted of.

I do not think that anybody on the Treasury bench will deny the simple fact that this crisis had nothing whatever to do with the Budget of this country. [Interruption.] There is not a bankers' monthly report which does not contain the statement that the crisis arose because of the situation that had arisen in Germany and Central Europe generally. No one denies that fact, and consequently I am entitled to say that the gentry whom we are asked to trust with the finances of this country are gentlemen who have proved themselves absolutely incapable and incompetent, and the sooner we sack the lot the better.

Sometimes it is imagined that this sort of thing is something exceptional, but ever since we have had banking arrangements and gambling in stocks and shares and other things of a similar character crises have occurred every now and then, and some of them have been bigger than others. I remember one crisis when was a boy quite as big as the present crisis—I refer to the smash of Baring Brothers. Then they telegraphed for Mr. Disraeli, and he said, "Get on with the job; it has nothing to do with me. "—[Interruption.] If I have given the name of the wrong firm, I am sorry. [Interruption.] At any rate, I am perfectly certain that it was one of the crises in the City of London. [Interruption.] It is no fairy tale; hon. Members opposite are only proving my case if they prove that there is another one that I have not mentioned. [Interruption.] There is nothing muddle-headed except with the bankers. The point I am making is that these gentlemen who control currency, who control banking, are all individually and collectively responsible for the position in which they find themselves, and as, when they make money for themselves, they hold on to it, they should, like any other people who fail, put up with the consequences. We ought to arrange matters so that their business, when it fails, shall not pull down the credit of the country. I do not deny at all that when they crash they may bring us down too, but I think that intelligent statesmen should take steps at the earliest possible moment to remove the credit system out of their hands and so organise it that these accidents do not happen—[Interruption.]

The handing of pieces of paper by people one to another adds no value to anything. I know I shall be told that it is that invisible thing, credit, which is being dealt with. I will tell the House an absolutely true story. During the War a certain council wanted to be very patriotic and lend some money to War Loan. They had not any money, so the gentleman who moved the resolution said, "I know, Mr. Mayor, that we have not any money, but I also know that the bank manager will lend us some money," and so we borrowed £5,000 and put it into War Loan; we did nothing hut sign a piece of paper. We handed that to the bank, and I think we paid them interest on the overdraft. They wrote something in a book, and then I expect they gave some money to the Government, or passed some bits of paper to the Government, and that is how the loan worked. [Interruption.] But the credit on which that piece of paper was used had nothing to do with the bank; they added no credit to it; the credit behind that £5,000 was the belief of the Government that if necessary the people in the back streets of Poplar would pay the bond. No one can deny that.

This thing that you call national credit is not something that is woven round the banker; it rests on the labour of the people who live in the back streets of this country. I have heard the right hon. Gentleman say that very same thing to audiences in the country. [Interruption.] Then why should we pay interest to bankers for our own credit? Why should anybody have made any money at all out of that transaction of the Poplar Borough Council? Our credit was there; it could have been put behind the Government; and there ought to have been no payment of commissions, no payment of interest to anyone at all; no addition to War Debt because nothing was lent beyond the credit of Poplar. Our credit remained, when the time came we found the money, and the banks never found anything. All that the bankers of this country, the so-called moneylenders who pass bits of paper, do, is to gamble with the credit of the nation. [Interruption.] What are these people asking us to do? The Prime Minister has said that all these facts are now known by people outside the Government, and we are at liberty, I understand, to discuss questions and matters that went to the Leader of the then Opposition and to the Leaders of the Liberal party.

It has been said that there has been no interference whatever with the affairs of our country, that the bankers, international and national, have only done what any lenders would be expected to do—they wanted to make sure that they would get their money back. That is their business. I should have no objection to that if they were dealing with semi-bankrupts, but I have an objection to it when applied to this country. The fact in regard to this matter, and hon. and right hon. Gentlemen opposite know it as well as I do, is that we have been told again and again that, if we wanted to save the pound, no matter how we balance our Budget, whether we make a cut or impose taxation, unless we cut unemployment benefit the pound would go "swop." I say that that is a foul thing ever to have been allowed to happen to this country. I went home one night thinking over these things, and, remembering that the right hon. Gentleman quoted something from Swinburne the other night, I also remembered something that Tennyson had written because of interference by a certain monarch in the domestic affairs of this country: "As long as we remain, we must speak free,

Tho' all the storm of Europe on us break;

No little paltry state are we,

But the one voice in Europe; we must speak;

That if to-night our greatness were struck dead,

There might be left some record of the things we said.

If you be fearful, then must we be bold. Our Britain cannot salve a tyrant O'er.

Better the waste Atlantic roll'd

On her and us and ours for evermore.

What! have we fought for Freedom from our prime,

At last to dodge and palter with a public crime?

Shall we fear them? our own we never fear'd.

From our first Charles by force we wrung our claims.

Prick'd by the Papal spur, we rear'd,

We flung the burthen of the second James.

Tho' niggard throats of money-lords may bawl,

What England was, shall her true sons forget?

We are not money-lenders all,

But some love England and her honour yet.

And these in our Thermopylae shall stand,

And hold against the world this honour of the land."

These bankers have said to us, "Your social services are attracting the notice of the unemployed masses in the United States, who marching with banners dernand unemployment benefit as in this country." The bankers and the capitalists have said, "Wages must come down, social services must be stopped, and Great Britain is the country that we must attack." This has been going on all through these two years. We have been discussing in committees one after the other what to do in order to meet this situation, and we are told that we ran away. We are told that we gave up. The people who ran away are those who sit over there. They have capitulated to the moneylenders, and what have they capitulated to do? The right hon. Gentleman is now to be put in charge of the whole of this business of crushing and beating down the unemployed. I know the right hon. Gentleman's administration. I know what his cruel orders can do. Before the ink is dry on his appointment, already the London County Council are plundering the poor old dame's pensions and reducing the relief of these old, people by a shilling a week. I suppose that is equality of sacrifice.

The hon. and learned Gentleman who preceded me said you could not really make it equal. I agree that you cannot. I said in one of these discussions that my salary was some £2,000 a year. You could have cut it by £1,800 or £1,000 and still I should be in a better position than the unemployed. Who is there in this House, myself or any one else, who is going to suffer a single moment of hunger or privation? The right hon. Gentleman talked of his great post bag. I, too, have a big post bag. It comes from widows and from ex-service men. Do you Liberals who are here remember Dr. Macnamara pleading in this House for those who formed what he called the living wall in France and Belgium. Again and again he appealed to us to do their memory justice, and we have failed them. To-day you are going to crush their children and their grandchildren further down. This mean, miserable destitution test means that the children are to keep the parents and the parents are to keep the children. The right hon. Gentleman once said that this business of making the family take care of the unemployed meant that individuals had to bear what was a national responsibility. Under the proposals contained in this memorandum they are going to the Poor Law. I suppose we shall be told that we agreed for them to go to the Poor Law. You know that is absolutely untrue. If I were not in the House, I would call it by another name than that.

May I say this about economy and the unemployed generally? I have had a good deal to do with teachers in the East End. They are the people to whom the children, the parents, and the whole community go, and they thank them and feel glad that they have such men and women doing unpaid work for hours on end. They are fighting their fight. The police are fighting their fight, and we shall aid them. There are the unemployed left. I came to this House as one who stood for the unemployed. I have never been elected but, in the main, through their votes and through the votes of very poor people indeed. My constituency is one of those where there is a dead level of poverty. I believe that we should be able to transform Capitalism into Socialism. It may very well be that what is happening today will prevent us from doing it in a peaceful, ordered manner. [Interruption.] I do not know. But I know that in the office that I represented in the late Government I had to go to the Roman Wall in the North of England. I stood there one day and wondered how the Roman soldier would think and feel could he wake up and see the England of to-day. I also remembered that that mighty Empire just went out; that this country, which had had four centuries of its civilisation, which had been ruled from end to end by the Romans, went back in civilisation after four centuries of Roman rule. Yes, after four centuries of Roman occupation, barbarism succeeded it.

No one will deny that. I asked myself why? The Romans were a cultured race. The Romans were people who knew more than the barbarians. The Romans were people who had the art and science of the time at their disposal and did wonderful and marvellous work here. I will tell you why they failed. They failed because they founded their Empire upon force, domination and materialism. The House may say to me what they will, but I say this finally to everybody here, that this nation has built up a great and mighty Empire in all parts of the world, but, like the Romans, we are decaying at the centre, because we worship the god of materialism, the god of gold. We worship not human life, not brotherhood, not comradeship, not love, but we believe in a gospel of riches and poverty. Well, I do not.

There are two phases of life. There are the givers and the takers. For my sins, I have been on the side of those who believe that the law of life, for individuals and for States, is not what they get, but what they give, and the test of Christianity and of British civilisation is, "Can you apply, and will you apply, the principle of brotherhood alike?" If you believe in the true doctrine of the Founder of our faith, then you must reject this Bill; you must throw it out. Rich and powerful as we are, we must say, "If there is a crisis, and if there is a need, then all of us will come down together and share whatever there is to share with one another." We must accept the teaching embodied in the words "Unto this last as unto thee." Unless this is done, this nation will go out as Rome went out.

I will conclude with scone lines which the two right hon. Members opposite will remember well. The poor and the downcast of this country have had great champions in those two right hon. Gentlemen. They have sat on platforms with their colleagues here while this song of Edward Carpenter's has been sung, and they have cheered when the crowd has cheered, and sung it with them. Here it is—[HoN. MEMBERS:"Sing it!"] If hon. Members wish it to be sung, my hon. Friends on this side will sing it:

• "Over your face, a web of lies is woven,
• Laws that are falsehoods pin you to the ground;
• Labour is mocked, its just reward is stolen,
• On its bent back sits idleness enthroned.
• From each wretched slum, let the loud cry come,
• 'Arise, oh England for the day is here!'
• Forth then ye heroes, patriots and lovers,
• Comrades of danger, poverty and scorn,
• Mighty in faith of freedom, your great mother,
• Giants refreshed in joy's new rising morn;
• Come and swell the song, silent now so long,
• 'England is risen and the day is here!'"

My final words are these: We may be beaten to-night. Our flag for the moment may go down, but, as was said of a great political reform, it will arise again and it will be borne by the common people, marching with us, and we shall sweep out of power and out of place the men who have usurped power.

Mr. CHAMBERLAIN

The right hon. Gentleman at the end of his observations said that he had always taken a heterodox line upon this subject. I have no doubt that that was the reason why he was selected to wind up the debate. The colleagues of the right hon. Gentleman knew that he could be relied upon not to be trammelled in any way by any decision at which they had arrived, that he could be counted upon never to come within one thousand yards of the point, and that he would do, as he so often has done before, raise as much class privilege as possible—[Interruption]—to divert attention from the true point. If he expressed his theory on banking, finance and history at as great length as he has spoken tonight, I am not surprised that the meetings of the Cabinet were so extraordinarily prolonged. The Amendment which we are discussing is not the personal Amendment of the right. hon. Gentleman but the official Amendment of the Opposition, and it is the views of the official Opposition and not the personal views of the right hon. Gentleman that we have to meet.

The Amendment asks the House to reject the Bill on two grounds. First, on the ground of the alleged unfairness of its provisions, and, secondly, on the ground of the method of its procedure. The whole of the debate has centred round the first of these two grounds of objection, and, therefore, we may almost take it that the second objection is more a matter of form on the part of the Opposition—[Interruption]. The procedure which has been adopted in this Bill is not without precedent. In the opening days of the great war an Act was passed authorising the making of Orders-in-Council for public safety and the defence of the realm—[Interruption]. This Bill has precisely the same purpose. The lives of His Majesty's subjects may not be in danger, but certainly their livelihood was threatened by the crisis which this Bill is designed to avert—[Interruption]. In spite of the doubts of some hon. Members opposite, it cannot be seriously contested that a crisis did exist, and a very serious crisis.

The right hon. Gentleman the Member for Nelson and Colne (Mr. Greenwood), who I am surprised not to see in his place to-night, and as far as I know he has not been here at any time during the Debate, said at an earlier stage of our proceedings that neither he nor his colleagues had ever denied that there was a crisis and only a week ago, speaking to his constituents in the Colne Division, he told us that we had been trembling on the very verge of national ruin. It is at least a remarkable fact that those who were nearest to the centre in that period, as well as members of the parties on this side of the House, were the most convinced not only of the imminence but also of the seriousness of the crisis which was upon us. And, indeed, the right hon. Gentleman need not have stopped when he said that we were trembling on the verge of national ruin, because it is quite certain that if the flight from the pound had actually taken place it would not have stopped in this country. Other countries in the Empire would immediately have been involved, as well as a large part of Europe and also countries on the other side of the Atlantic; in fact, the whole world would have felt the impact of the blow. There cannot possibly be any doubt about the terrible consequences which would have followed if the flight from the pound had been allowed to take place—[Interruption.] I hope the House will realise that the danger which was averted was only averted provisionally, if one may use a word which seems to be a favourite one on the other side of the House, and that any delay in putting into operation the proposals which the Government are bringing forward in This Bill might very well have the effect of bringing back the very danger from which we have, at any rate for the time, been saved. Therefore, the answer to that part of the objection of hon. Members opposite is that the procedure is demanded by the national safety. That is the only, but sufficient, justification.

I have now to deal with the more serious part of the Amendment. I ask the House to consider for a moment how this crisis could have been met at the time when it became imminent. I notice that the right hon. Gentleman the Member for Nelson and Colne, in that same speech from which I have quoted, stated that there were two ways in which it could have been met. The first way was by the mobilisation of foreign securities. Be said that that method had not been chosen because the bankers could not be expected to see a method different from their own. My first comment on that is this: That if the Government really thought that that was the best way to meet the crisis, then their behaviour was singularly weak if they allowed themselves to be diverted from it merely because the bankers preferred another method. The fact is that the right hon. Gentleman did not do justice either to himself or his colleagues. That was not the reason. That reason was only given by the right hon. Gentleman in order to create prejudice against the bankers among his constituents. The truth is that the bankers knew that that method would not serve the purpose and would not avert the crisis.

My right hon. Friend the Member for St. Ives (Mr. Runciman) on Thursday used words which it is not necessary for me to repeat, but I will add this: I think he showed great moderation in even accepting provisionally the figure of £400,000,000 as being the total amount of the foreign securities that might be available for the purpose, because, as he truly stated, the only foreign securities which could have been of any use for this purpose were dollar securities, and £100,000,000 is a very big estimate of the amount of dollar securities held in this country.A little while ago the "Economist" estimated the amount of dollar securities held in this country at about £100,000,000. Certainly, even taking the £100,000,400, it is the fact that not more than a fraction of that amount could have been mobilised without taking such drastic measures, as, I am sure, could not be contemplated in the present circumstances. Therefore, I think we may dismiss the method of demobilisation of foreign securities.

I turn to the other method of the right hon. Gentleman, which was in fact the method that the late Government adopted. That method was to try to establish credits or to borrow money elsewhere, in order to support the exchange in New York and Paris. There is another statement which has been made and which has been discredited in the course of the Debate, and that is that this was a bankers' conspiracy. The right hon. Gentleman the Leader of the Opposition stated only a few days ago that he would never dream of making such a charge. The great international financier, the right hon. Gentleman who has just addressed the House, thinks that all bankers are muddle-headed and only he is clear. My right hon. Friend very clearly demonstrated the complete want of any foundation for the suggestion that this was a bankers' conspiracy.

Really, there is something rather comic to me about the attitude of the late Lord Privy Seal on this matter. He and those who follow him seem to forget entirely that the foreign bankers were not coming to this country begging us to accept a loan from them. On the contrary, it was we who were going to them to ask for a loan. [Interruption.] That is precisely what the late Government had to do, and it was the duty of the foreign bankers, when approached, to state under what conditions they thought it possible to raise the money. [Laughter.] I do not understand the hilarity among hon. Members opposite, because that is precisely what the Leader of the Opposition said the other day was the natural and proper thing for them to do. But the moment they say what those conditions in their opinion were, the right hon. Gentleman says, "What presumption." His attitude is that they should hand over the money at once and make no conditions at all.

The attitude of the right hon. Gentleman is that of the highwayman, but in the days of the highwaymen they took the precaution first of all to see that their pistols were loaded and primed, because if the pistol did not go off at the right moment, then the consequences were apt to be disagreeable for the highwayman. What was the position on 13th August, the day when I was asked, in company with my right hon. Friend the Lord President of the Council, to see the Prime Minister and the Chancellor of the Exchequer? The position was that the credits which had already been obtained in New York and Paris were nearly exhausted.

Mr. THURTLE

Who says that?

Mr. CHAMBERLAIN

Therefore, a loan was unobtainable at the time, and we were told that it would remain unobtainable unless foreign confidence in the stability of British credits was restored. There was a widespread impression in foreign countries, not confined to any one country in particular, that the root of the financial trouble in this country was the condition of the Unemployment Insurance Fund, and they were convinced that unless the Government of this country did intend to make the necessary reform in that fund, by putting it on a proper insurance basis, it was quite probable that confidence would not be restored. When we found that the Government had decided to accept economies of £56,000,000 only, although the deficit was £170,000,000, and when we found that in that £56,000,000 the saving on the Unemployment Insurance Fund was only £5,000,000, can the House wonder that all of us, Liberals and Conservatives—[Interruption]—considered that those savings were inadequate, and not likely to restore that confidence which had been shaken?

Let the House remember that we had been invited by the Government to come and be informed of what their proposals were and to express our opinions upon them. [Interruption.] We had at once accepted that invitation. We had put aside all thoughts of party interest—[HoN. MEMBERS: "Oh!"]—in order to try to make our contribution to what appeared to be the danger of a great national disaster. [Interruption.] Our task was not made easier by the fact that the official organ of the party opposite immediately tried to exploit our presence in London and to use it for party purposes. [Interruption.]

Mr. SPEAKER

It is very difficult for the right hon. Gentleman to speak if he is subjected to these constant interruptions.

Mr. CHAMBERLAIN

We have had speeches from various right hon. Members opposite purporting to give the effect of the conversations which had taken place, and in view of that fact and of the fact that the Leader of the Opposition gave the House his account of those conversations, or what he said had been reported to him in those conversations, I think I, as one who took part in them, am also entitled to give my version of what took place. There was no ultimatum. There was no demand for a specific increase in the economies. There never was a demand for a specific cut in unemployment benefit. Our views were put forward as suggestions, as honest expressions of opinion as to what we thought would be the steps necessary to avert the crisis which had brought us to the verge of national ruin—[Interruption]—and I am sure the House will be relieved that I can tell them to-night that in every particular I can confirm the figures given to the House this afternoon by my right hon. Friend the Home Secretary and that those were the figures which were given to us during those conversations.

We find ourselves then in this position, that to-day, instead of the Government being in the dock, it is the members of the Labour party. One after another has had to get up and try to explain and defend his action. What has been clearly established is this, first, that the late Government accepted economies amounting to £56,500,000, and, secondly, that those £56,500,000 included every single one of the proposals which are before the House to-day, except the 10 per cent. cut in the unemployment benefit. What theta is the use of the right hon. Gentleman opposite pretending he does not know what is included in the cut which is to take place?

Mr. GREENWOOD

We have only got the White Paper.

Mr. CHAMBERLAIN

The figure in the White Paper is identically the same figure as was accepted by the late Government. The right hon. Gentleman says he does not know what is in the figure, but, if there is any difference between what he proposed and what I am going to propose, he knows it, and not I. The right hon. Gentleman was fully conscious of his difficulties. He knew very wed that to attack any of these proposals was to attack the very course which his own Government had accepted. Is, therefore, the difference between us, the rate of the unemployment benefit, such a vital principle as to warrant the late Government resigning and running these risks? That, of course, may have been his own personal view, but it was not the view of his leader, because I want to add this to what was said by the Home Secretary this afternoon. In the original proposals as put before us and before they were submitted to the Cabinet—we had been discussing the proposals of, the Committee—we were told that there were under consideration proposals, not merely to reduce the number of weeks from 52 to 26, not merely to increase the contribution, not merely to put a means test on to those in receipt of transitional benefit, but also to adopt the trade union practice of deducting the contribution from the benefit. We were told that the contribution was to be is, a week. What is the difference in principle between deducting 1s. a week from the unemployment rate and taking 1s. a week off it?

Dr. ADDISON

Was the right hon. Gentleman also told that, when that suggestion was referred to a committee, it was unanimously rejected?

Mr. P. SNOWDEN

Will the right hon. Gentleman tell the House at whose suggestion that proposal was made and referred to a committee?

Dr. ADDISON

I do not remember. [Interruption.] I know the suggestion came from the right hon. Gentleman—

Mr. SNOWDEN

No, no.

Dr. ADDISON

—and was referred to a sub-committee and rejected.

Mr. SNOWDEN

Does the right hon. Gentleman say that suggestion came from me?

Dr. ADDISON

No.

HON. MEMBERS

From whom?

Mr. CHAMBERLAIN

The Leader of the Opposition is not in his place, but I cannot help thinking that even he would have remembered from whom that suggestion came. The late Home Secretary said that under this Bill cuts were going to be subject to the secret decision of the Cabinet. There is not a word of truth in that. The cuts are set out clearly in the White Paper. What the right hon. Gentleman has forgotten is that he and his colleagues agreed in the end by a majority definitely to accept all the proposals with the exception of the one relating to unemployment benefit. With

regard to that one, I assure them that this was considered—[HON. MEMBERS: "And rejected!"] You do not consider a matter which is of such vital importance unless—[Interruption.] To make these economies is as disagreeable and distasteful a task as could be undertaken by any Government. It requires more courage—[Interruption.] A Government formed as this Government has been for a specific purpose must always be at a disadvantage. Everybody recognises that, although the measures that we have taken have for the time being averted the disaster which threatened us, in the long run they must fail unless we restore the trade balance. [HON MEMBERS: "Swallow the tariff!"] Everybody admits that these proposals must have an immediate effect on increasing unemployment, but to complete the programme we want a constructive programme to stimulate the progress of industry and agriculture. This country cannot long await that constructive programme. The sooner we conclude this business the sooner the Government or its successors will be able to begin on the work of building up.

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

The House divided: Ayes, 310; Noes, 253.

Division No. 469.]	AYES.	[11.0 p.m.
Acland-Troyte, Lieut.-Colonel	Bracken, B.	Cobb, Sir Cyril
Ainsworth, Lieut.-Col. Charles	Braithwaite, Major A. N.	Cockerill, Brig.-General Sir George
Aitchison, Rt. Hon. Craigle M.	Brass, Captain Sir William	Cohen, Major J. Brunel
Albery, Irving James	Briscoe, Richard George	Colfox, Major William Philip
Alexander, Sir WM. (Glasgow, Cent'l)	Broadbent, Colonel J.	Collins, Sir Godfrey (Greenock)
Allen, Lt.-Col. Sir William (Armagh)	Brown, Col. D. C. (N'th'I'd., Hexham)	Colman, N. C. D.
Amery, Rt. Hon. Leopold C. M. S.	Brown, Ernest (Leith)	Colville, Major D. J.
Ashley, Lt.-Col. Rt. Hon. Wilfrid W.	Brown, Brig.-Gen. H. C. (Berks, Newb'y)	Conway, Sir W. Martin
Astor, Maj. Hn. John J. (Kent, Dover)	Buchan, John	Cooper, A. Duff
Astor, Viscountess	Buchan-Hepburn, P. G. T.	Courthope, Colonel Sir G. L.
Atholl, Duchess of	Bullock, Captain Malcolm	Cowan, D. M.
Atkinson, C.	Burgin, Dr. E. L.	Crichton-Stuart, Lord C.
Ballile-Hamilton, Hon. Charles W.	Burton, Colonel H. W.	Cranborne, Viscount
Baldwin, Rt. Hon. Stanley (Bewdley)	Butler, R. A.	Croft, Brigadier-General Sir H.
Balfour, George (Hampstead)	Butt, Sir Alfred	Crookshank, Capt. H. C.
Balfour, Captain H. H. (I. of Thanet)	Cadogan, Major Hon. Edward	Culverwell, C. T. (Bristol, West)
Balniel, Lord	Campbell, E. T.	Cunliffe-Lister, Rt. Hon. Sir Philip
Beamish, Rear-Admiral T. P. H.	Carver, Major W. H.	Dalkeith, Earl of
Beaumont, M. W.	Castle Stewart, Earl of	Dairymple-White, Lt.-Col. Sir Godfrey
Bellairs, Commander Carlyon	Cautley, Sir Henry S.	Davidson, Rt. Hon. J. (Hertford)
Bennett, Sir E. N. (Cardiff, Central)	Cayzer, Sir C. (Chester, City)	Davies, Dr. Vernon
Berry, Sir George	Cayzer, Maj. Sir Herbt. R.-(Prtmth, S.)	Davies, E. C. (Montgomery)
Betterton, Sir Henry B.	Cazalet, Captain Victor A.	Davies, Maj. Geo. F. (Somerset, Yeovil)
Bevan, S. J. (Holborn)	Cecil, Rt. Hon. Lord H. (Ox. Univ.)	Davison, Sir W. H. (Kensington, S.)
Birchall, Major Sir John Dearman	Chadwick, Capt. Sir Robert Burton	Dawson, Sir Phllip
Birkett, W. Norman	Chamberlain, Rt. Hn. Sir J. A. (Birm., W.)	Denman, Hon. R. D.
Blindell, James	Chamberlain, Rt. Hon. N. (Edgbaston)	Despencer-Robertson, Major J, A. F.
Boothby, R. J. G.	Chapman, Sir S.	Dixey, A. C.
Bourne, Captain Robert Croft.	Christle, J. A.	Dixon, Captain Rt. Hon. Herbert
Bowater, Col. Sir T. Vanslttart	Church, Major A. G.	Duckworth, G. A. V.
Bowyer, Captain Sir George E. W.	Churchill, Rt. Hon. Winston Spencer	Dudgeon, Major C. R.
Boyce, Leslie	Clydesdale, Marquess of	Dugdale, Capt. T. L.
Eden, Captain Anthony	Kedward, R. M. (Kent, Ashford)	Richardson, Sir P. W. (Sur'y, Ch'te'y)
Edge, Sir William	Kindersley, Major G. M.	Roberts, Sir Samuel (Ecclesall)
Edmondson, Major A. J.	Knight, Holford	Robinson, Sir T. (Lancs, Stretford)
Elliot, Major Walter E.	Lamb, Sir J. Q.	Rodd, Rt. Hon. Sir James Rennell
Elmley, Viscount	Lambert, Rt. Hon. George (S. Molton)	Rosbotham, D. S. T.
England, Colonel A.	Lane Fox, Col. Rt. Hon. George R.	Ross, Ronald D.
Erskine, Lord (Somerset, Weston-s-M.)	Latham, H. P. (Scarboro' & Whitby)	Rothschild, J. de
Evans, Capt. Ernest (Welsh Univer.)	Law, Sir Alfred (Derby, High Peak)	Ruggles-Brise, Colonel E.
Everard, W. Lindsay	Leigh, Sir John (Clapham)	Runciman, Rt. Hon. Walter
Falle, Sir Bertram G.	Leighton, Major B. E. P.	Russell, Alexander West (Tynemoulh)
Ferguson, Sir John	Lewis, Oswald (Colchester)	Russell, Richard John (Eddlsbury)
Fermoy, Lord	Little, Graham-, Sir Ernest	Salmon, Major I.
Fielden, E. B.	Llewellin, Major J. J.	Samuel, A. M. (Surrey, Farnham)
Fison, F. G. Clavering	Locker-Lampson, Rt. Hon. Godfrey	Samuel, Rt. Hon. Sir H. (Darwen)
Foot, Isaac	Locker-Lampson, Com. O. (Handsw'th)	Samuel, Samuel (W'dsworth, Putney)
Ford, Sir P. J.	Lockwood, Captain J. H.	Sandeman, Sir N. Stewart
Forestier-Walker, Sir L.	Long, Major Hon. Eric	Sassoon, Rt. Hon. Sir Philip A. G. D
Frece, Sir Walter de	Lovat-Fraser, J. A.	Savery, S. S.
Fremantle, Lieut. Colonel Francis E.	Lymington, Viscount	Shakespeare, Geoffrey H.
Galbraith, J. F. W.	McConnell, Sir Joseph	Shepperson, Sir Ernest Whittome
Ganzoni, Sir John	MacDonald, Rt. Hon. J. R. (Seaham)	Simon, Rt. Hon. Sir John
Gault, Lieut.-Col. A. Hamilton	MacDonald, Malcolm (Bassetlaw)	Sinclair, Sir A. (Caithness)
George, Major G. Lloyd (Pembroke)	Macdonald, Sir M. (Inverness)	Sinclair, Col. T. (Queen's U., Belfast)
George, Megan Lloyd (Anglesea)	Macdonald, Capt. P. D. (I. of W.)	Smith, Louis W. (Sheffield, Hallam)
Gibson, C. G. (Pudsey & Otley)	Maclean, Sir Donald (Cornwall, N.)	Smith, R. W. (Aberd'n & Klnc'dine, C.)
Gillett, George M.	Macpherson, Rt. Hon. Jamas I.	Smith-Carlngton, Neville W.
Gilmour, Lt.-Col. Rt. Hon. Sir John	Macquisten, F. A.	Smlthers, Waldron
Glnssey, A. E.	Maltland, A. (Kent, Faversham)	Snowden, Rt. Hon. Philip
Glyn, Major R. G. C.	Makins, Brigadier-General E.	Somerset, Thomas
Gower, Sir Robert	Mander, Geoffrey le M.	Somerville, A. A. (Windsor)
Graham, Fergus (Cumberland, N.)	Margesson, Captain H. D.	Somerville, D. G. (Willesden, East)
Granville, E.	Marjoribanks, Edward	Southby, Commander A. R. J.
Grattan-Doyle, Sir N.	Mason, Colonel Glyn K.	Spender-Clay, Colonel H.
Gray, Milner	Meller, R. J.	Stanley, Lord (Fylde)
Greaves-Lord, Sir Walter	Merriman, Sir F. Boyd	Stanley, Hon. O. (Westmorland)
Greene, W. P. Crawford	Miller, J. D.	Steel-Maltland, Rt. Hon. Sir Arthur
Grenfeil, Edward C. (City of London)	Milne, Wardlaw-, J. S.	Stewart, W. J. (Belfast, South)
Gretton, Colonel Rt. Hon. John	Mitchell, Sir W. Lane (Streatham)	Stuart, Hon. J. (Moray and Nairn)
Griffith, F. Kingsley (Middlesbro' W.)	Moore, Lieut.-Colonel T. C. R. (Ayr)	Sueter, Rear-Admiral M. F.
Gritten, W. G. Howard	Morris, Rhys Hopkins	Taylor, Vice-Admlral E. A.
Gunston, Captain D. W.	Morris-Jones, Dr. J. H. (Denbigh)	Thomas, Rt. Hon. J. H. (Derby)
Hacking, Rt. Hon. Douglas H.	Morrison. W. S. (Glos., Cirencester)	Thomas, Major L. B. (King's Norton)
Hall, Lieut.-Col. Sir F. (Dulwich)	Morrison-Bell, Sir Arthur Clive	Thompson, Luke
Hamilton, Sir George (Ilford)	Mulrhead, A. J.	Thomson, Sir F,
Hamilton, Sir R. (Orkney & Zetland)	Nail-Cain, A. R. N.	Titchfleld, Major the Marquess of
Hammersley, S. S.	Nathan, Major H I.	Todd, Capt. A. J.
Hanbury, C.	Newman, Sir R. H. S. D. L. (Exeter)	Train, J.
Hannon, Patrick Joseph Henry	Newton, Sir D. G. C. (Cambridge)	Tryon, Rt. Hon. George Clement
Harbord, A.	Nicholson, O. (Westminster)	Turton, Robert Hugh
Harris, Percy A.	Nicholson, Col. Rt. Hn. W. G. (Ptrsf'ld)	Vaughan-Morgan, Sir Kanyon
Hartington, Marquess of	O'Connor, T. J.	Wallace, Capt. D. E. (Hornsay)
Harvey, Major S. E. (Devon, Totnes)	Oliver, P. M. (Man., Blackley)	Walters, Rt. Hon. Sir J. Tudor
Haslam, Henry C.	Oman, Sir Charles William C.	Ward, Lleut.-Col. Sir A. Lambert
Henderson, Capt. R. R. (Oxf'd, Henley)	Ormsby-Gore, Rt. Hon. William	Warrender, Sir Victor
Heneage, Lieut.-Colonel Arthur P.	Peake, Capt. Osbert	Waterhouse, Captain Charles
Hennessy, Major Sir G. R. J.	Penny, Sir George	Wayland, Sir William A.
Hills, Major Rt. Hon. John Waller	Percy, Lord Eustace (Hastings)	Wells, Sydney R.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.	Perkins, W. R. D.	White, H. G.
Hope, Sir Harry (Forfar)	Peters, Dr. Sidney John	Williams, Charles (Devon, Torquay)
Hore-Belisha, Leslie	Peto, Sir Basil E. (Devon, Barnstaple)	Wilson, G. H. A. (Cambridge U.)
Horne, Rt. Hon. Sir Robert S.	Power, Sir John Cecil	Windsor-Clive, Lleut.-Colonel Georgt
Hudson, Capt. A. U. M. (Hackney, N.)	Pownall, Sir Assheton	Winterton, Rt. Hon. Earl
Hunter-Weston, Lt.-Gen. Sir Aylmer	Preston, Sir Walter Rueben.	Withers, Sir John James
Hurd, Percy A,	Purbrick, R.	Wolmer, Rt. Hon. Viscount
Hurst, Sir Gerald B.	Pybus, Percy John	Womersley, W. J.
Hutchison, Maj.-Gen. Sir R.	Ramsay, T. B. Wilson	Wood, Rt. Hon. Sir Kingsley
Inskip, Sir Thomas	Rathbone, Eleanor	Wood, Major McKenzIe (Banff)
Iveagh, Countess of	Rawson, Sir Cooper	Young, Rt. Hon. Sir Hilton
Jones, Llewellyn-, F.	Reid, David D. (County Down)
Jones, Sir G. W. H. (Stoke New'gton)	Remer, John R.	TELLERS FOR THE AYES.—
Jones, Henry Haydn (Merioneth)	Rentoul, Sir Gervale S.	Commander Sir B. Eyres Monsell
Jones, Rt. Hon. Lelt (Camborne)	Reynolds, Col. Sir James	and Major Owen.
Jowitt, Rt. Hon. Sir W. A. (Preston)	Rhys, Hon. Charles
NOES
Adamson, Rt. Hon. W. (Fife, West)	Arnott, John	Benn, Rt. Hon. Wedgwood
Adamson, W. M. (Staff., Cannock)	Attlee, Clement Richard	Bennett, William (Battersea, South)
Addison, Rt. Hon. Dr. Christopher	Ayles, Walter	Benson, G,
Alexander, Rt. Hon. A. V. (Hillsbro')	Baker, John (Wolverhampton, Bilston)	Bevan, Aneurin (Ebbw Vale)
Allen, W. E. D. (Belfast, W.)	Barnes, Alfred John	Bondfield, Rt. Hon. Margaret
Alpass, J. H.	Barr, James	Bowen, J. W.
Ammon, Charles George	Batey, Joseph	Bowerman, Rt. Hon. Charles W.
Angell, Sir Norman	Beckett, John (Camberwell, Peckham)	Broad, Francis Alfred

Brockway, A. Fenner	Jones, J. J. (West Ham, Gilvertown)	Richards, R.
Bromfield, William	Jones, Morgan (Caerphilly)	Richardson, R. (Houghton-le-Spring)
Bromley, J.	Jowett, Rt. Hon. F. W.	Riley, Ben (Dewsbury)
Brooks, W.	Kelly, W. T.	Riley, F. F. (Stockton-on-Tees)
Brothers, M.	Kennedy, Rt. Hon. Thomas	Ritson, J.
Brown, C. W. E. (Notts, Mansfield)	Kenworthy, Lt.-Com. Hon. Joseph M.	Romerll, H. G.
Brown, Rt. Hon. J. (South Ayrshire)	Kinley, J.	Rowson, Guy
Brown, W. J. (Wolverhampton, West)	Kirkwood, D.	Salter, Dr. Alfred
Buchanan. G.	Lang, Gordon	Samuel, H. Walter (Swansea, West)
Burgess, F. G.	Lansbury, Rt. Hon. George	Sanders, W. S.
Buxton, C. R. (Yorks. W. R. Elland)	Lathan, G. (Sheffield, Park)	Sandham, E.
Cameron. A. G.	Law, Albert (Bolton)	Sawyer, G. F.
Cape, Thomas	Law, A. (Rossendale)	Scurr, John
Carter, W. (St. Pancras, S.W.)	Lawrence, Susan	Sexton, Sir James
Charleton, H. C.	Lawrle, Hugh Hartley (Stalybridge)	Shepherd, Arthur Lewis
Chater, Danial	Lawson, John James	Sherwood, G. H.
Clarke, J. S.	Lawther, W. (Barnard Castle)	Shield, George William
Cluse, W. S.	Leach, W.	Shlels, Dr. Drummond
Clynes, Rt. Hon. John R.	Lee, Frank (Derby, N.E.)	Shlllaker, J. F.
Cockt, Frederick Seymour	Lee, Jennie (Lanark, Northern)	Shlnwell, E.
Compton, Joseph	Leonard, W.	Short, Alfred (Wednesbury)
Cove, William G.	Lewis, T. (Southampton)	Simmons, C. J.
Cripps, Sir Stafford	Lindley, Fred W.	Sinkinson, George
Daggar, George	Lloyd, C. Ellis	Sitch, Charles H.
Dallas, George	Logan, David Gilbert	Smith, Ben (Bermondsey, Rotherhithe)
Dalton, Hugh	Longbottom, A. W.	Smith, Frank (Nuneaton)
Davies, D. L. (Pontypridd)	Longden, F.	Smith, Lees-, Rt. Hon. H.B.(Kelghley)
Davies. Rhys John (Westhouqhton)	Lunn, William	Smith, Tom (Pontelract)
Day, Harry	Macdonald, Gordon (Ince)	Smith, W. R. (Norwich)
Devlin, Joseph	McElwee, A.	Snowden, Thomas (Accrington)
Dukes, C.	McEntee. V. L.	Sorensen, R.
Duncan, Charles	McKinlay, A.	Stamford, Thomas W.
Dunnico, H.	MacLaren, Andrew	Stephen, Campbell
Ede, James Chuter	Maclean, Nell (Glasgow, Govan)	Strachey, E. J. St. Loe
Edmunds, J. E.	MacNeill-Weir, L.	Strauss, G. R.
Edwards. C. (Monmouth, Bedwelity)	McShane, John James	Sullivan, J.
Edwards, E. (Morpeth)	Malone, C. L'Estrange (N'thampton)	Sutton, J. E.
Egan, W. H.	Manning, E. L.	Taylor, R. A. (Lincoln)
Evans, Major Herbert (Gateshead)	Mansfield, W.	Taylor, W. B. (Norlolk, S.W.)
Freeman, Peter	March, S.	Thorne, W. (West Ham, Plalstow)
Gardner, B. W. (West Ham, Upton)	Marcus, M.	Thurtle, Ernest
Gibbins, Joseph	Marley, J.	Tinker, John Joseph
Gibson, H. M. (Lancs. Mossloy)	Marshall, Fred	Toole, Joseph
Gill, T. H.	Mathers, George	Tout, W. J
Gossling, A. G.	Matters, L. W.	Townend, A. E.
Gould, F.	Maxton, James	Trevelyan, Rt. Hon. Sir Charles
Graham, D. M. (Lanark, Hamilton)	Measer, Fred	Turner, Sir Ben
Graham, Rt. Hon. WM. (Edin., Cent.)	Middleton, G.	Vaughan, David
Greenwood, Rt. Hon. A. (Colnel	Mills, J. E.	Vlant, S. P.
Grenfell, D. R. (Glamorgan)	Milner, Major J.	Walkden, A. G.
Griffiths, T. (Monmouth, Pontypool)	Montague, Frederick	Walker, J.
Groves, Thomas E.	Morgan, Dr. H. B.	Wallace, H. W.
Grundy, Thomas W.	Morley. Ralph	Watkins, F. C.
Hall. F. (York, W.R., Normanton)	Morrison, Rt. Hon. H. (Hackney, S.)	Watson, W. M. (Dunfermline)
Hall, G. H. (Merthyr Tydvil)	Morrison, Robert C. (Tottenham, N.)	Watts-Morgan, Lt.-Col. D. (Rhondda)
Hall, J. H. (Whitechapel)	Mort, D. L.	Wedgwood, Rt. Hon. Joslah
Hamilton, Mary Agnes (Blackburn)	Mosley, Sir Oswald (Smethwick)	Weilock, Wilfred
Hardle, David (Rutherglen)	Muff, G.	Welsh, James (Paisley)
Hardie, G. D. (Springburn)	Muggeridge, H. T.	Welsh, James C. (Coatbridge)
Hastings, Dr. Somerville	Murnin, Hugh	West, F. R.
Haycock, A. W.	Naylor, T. E.	Westwood, Joseph
Hayday, Arthur	Noel Baker, P. J.	Whlteley, Wilfrid (Blrm., Ladywood)
Henderson, Rt. Hon. A. (Burnley)	Noel-Buxton, Baroness (Norfolk, N.)	Wilkinson, Ellen C.
Henderson, Joseph (Ardwlck)	Oldfield, J. R.	Williams, David (Swansea, East)
Henderson, Thomas (Glasgow)	Oliver, George Harold (likeston)	Williams, E. J. (Ogmore)
Henderson, W. W. (Middx Enfield)	Palln, John Henry	Williams, Dr. J. H. (Llanelly)
Herrlotts, J.	Paling, Wilfrid	Williams, T. (York, Don Valley)
Hicks, Ernest George	Palmer, E. T.	Wilson, C. H. (Sheffield, Attercliffe)
Hirst, G. H. (York W. R. Wentworth)	Parkinson, John Allen (Wigan)	Wilson, J. (Oldham)
Hirst, W. (Bradford, South)	Perry, S. F.	Wilson, R. J. (Jarrow)
Hoffman, P. C.	Pethick-Lawrence, F, W.	Winterton, G. E.(Leicester.Loughb'uh)
Hollins, A.	Phillips, Dr. Marlon	Wise, E. F.
Hopkin, Daniel	Picton-Turbervill, Edith	Young, R. S. (Islington, North)
Korrabln, J. F.	Pole, Major D. G.	Young, Sir R. (Lancaster, Newton)
Hudson, James H. (Hudderstield)	Potts, John S.
Isaacs, George	Price, M. P.	TELLERS FOR THE NOES.—
Jenkins, Sir William	Qulbell, D. J. K.	Mr. Hayes and Mr. William
Johnston, Rt. Hon. Thomas	Raynes, W. R.	Whiteley.

Question put, and agreed to.

Bill committed to a Committee of the Whole House for To-morrow.—[Sir B. Eyres Monsell.]

The remaining Government Orders were read, and postponed.