HC Deb 16 February 1933 vol 274 cc1201-319

3.50 p.m.


I beg to move, That this House deplores the entire failure of the Government to deal with the problem of unemployment and its continuance in a course of policy which, by lowering the purchasing power of the masses and restricting the flow of trade, has resulted in an increase of over 400,000 unemployed in twelve months; and this House calls upon the Government to initiate and carry through a far-reaching plan for the utilisation in the interests of the nation of the national resources in land, credit, materials, and man-power which are now lying idle, so as to increase the total production of wealth in the country. I want, at the outset, to say that in putting down this Motion of Censure on the Government and raising once again the question of unemployment, we think that we should at least have the support of the Lord President of the Council and his late colleagues, who set us a splendid example during the last Parliament on how to pursue a Government on so vital a matter as unemployment. I think that almost every week there was either a Motion on the question of unemployment or a Motion of Censure on the Government in one form or another. As conditions are very much worse to-day—[HON. MEMBERS: "No!"] Yes, considerably worse—we propose to take every opportunity of raising this most vital and important question. It has been said by a great Socialist that either society will settle the unemployment problem or the unemployment problem will settle society. There is a growing body of opinion in the world that that statement is true, and because that is a fact we are determined to press this question on the attention of the House.

In regard to one side of the question, we are not following the tactics of the Lord President of the Council and his colleagues. They charged the late Government with being the cause of unemployment. We do not charge this Government or any other Government of the past century with having caused the conditions which have produced the world economic crisis, but we do charge the Government with this fact, that whatever steps they have taken they have made conditions considerably worse and that, in the main, they have done nothing or any importance to deal with this great question. They have settled down, in the face of the criticism of their own supporters and in face of the appeals made to them by their own supporters, to a sort of complacent satisfaction that everything is well in the best of all possible worlds while they are on the Treasury Bench. We do not accept that point of view. We say that the Government have been, not only remiss, but very reactionary in regard to this great question.

Every intelligent employer of labour, certainly some of the largest employers of labour in this country, believe that the hours of labour should be regulated, if possible, by international agreement. At Geneva, however, the representatives of the Government have taken the line of blocking the proposal to establish a convention with that object in view. The Prime Minister ought to tell us the reason why the Government have taken that line. I have heard him say—I was going to say on thousands of occasions—certainly on many occasions, that a reduction in the hours of labour is one of the means of dealing with unemployment. Now he is at the head of a Government which is opposing not the actual introduction of a 30 or 40 hours' working week, but the proposal made at Geneva for establishing international agreement on this subject. The right hon. Gentleman cannot deny that the representative of the Ministry of Labour took that line.

The MINISTER of LABOUR (Sir Henry Betterton)

As the right hon. Gentleman has referred to the representative of the Ministry of Labour at Geneva, may I repudiate his statement as being not even remotely true?


I repeat the statement that the representative of the British Government at Geneva most definitely took that line, and it is unworthy of the right hon. Gentleman to interrupt me in that fashion. He knows very well that what I am saying is true. He also knows that the Labour representatives at that conference emphatically repudiated his representative and protested against his action. So far as that matter is concerned the Government's action has not only been reactionary but is opposed to the best progressive minds in the capitalist world in this country. Sir Harold Bowden has put it on record as his opinion that not merely a 40 hours' working week but even a less working week is necessary, and that a restricted age period will have to be introduced. We recognise that it is probably impossible in a general way to carry through that principle without some international agreement. Instead of the Government supporting us enthusiastically in that attitude, they have enthusiastically taken the other line.

Let me come to the Government's complacency and especially the Prime Minister's complacency. I have read his letter to the Bethnal Green local authority. I am glad that the Bethnal Green Corporation has given him a good answer. That local authority happens not to be a Labour Council. It is made up of representatives of all parties. Therefore it cannot be said to be actuated by spite or prejudice, Socialist prejudice, against the Prime Minister. Its appeal to the Prime Minister brought from him a statement which I think hon. and right hon. Members must regard as one of the most extraordinary statements ever made by a Prime Minister on such a subject. There will be many things for which the Prime Minister will be remembered, but I think this is one that will be remembered to his discredit for ever, because in that document he talks about arresting the growth of unemployment during the past year. I do not quite understand on what the right hon. Gentleman bases that statement. The argument is that unemployment increased during one period of 1929–31 and that it has not increased in the same ratio during 1932. Of all the amazing arguments, that is the most amazing. The right hon. Gentleman knows perfectly well that the European crisis which broke out some six months before his late Government went out of office came because of the expected failure of Germany and Austria to meet their liabilities. I thought that the nonsensical statement, still made in this House, that that crisis was caused because of something that this country was or was not doing had been exploded long ago.

There is not a single banker or financier in this country—I challenge any hon. or right hon. Member to find one—who will now stand up and say that the crisis which broke over Europe during' June and August of 1931 had any- thing whatever to do with the affairs in this country except in regard to the money market in the City of London. This nation had met all her obligations. This nation was under no obligation she could not meet, and the debtors of this nation had no right, and could have no right, to call in question our stability. It was the stability of the money lords of the City of London at stake, and that of nobody else. That caused a crisis not only in Europe but in America and in this country, and, obviously, when a crisis breaks out the figures run up very rapidly.

But taking the right hon. Gentleman's own period of office, the figures for January this year show an increase of 176,000, making a total of 2,903,000 out of work, and 170,000 on the Poor Law. Add to those the workers who are not insured, as I mentioned some weeks ago, and as the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) mentioned yesterday, the new army of black-coated proletariat, who were represented at a meeting in London the other night by university professors who came down to deplore the fact that now there is no room for men trained in the universities, and they did not know what occupation they were going to follow. The two right hon. Gentlemen, the Minister for Health and the Minister for Labour, can add also those by your cynical, your brutal administration of transitional payments—[HON. MEMBERS: "Oh!"]—I will repeat those words for the benefit of hon. Members—the cynical, callous, brutal administration. Let hon. Members go to their constituents and jeer at them as they are jeering at me. You push these tens of thousands on to their families, and if you add them all together, you will find that the number will total well over 3,500,000. That is the figure which, with the utmost complacency, the right hon. Gentleman discussed yesterday and the Prime Minister dealt with in his letter to Bethnal Green.

There is another point in which the right hon. Gentleman will be interested. There have been 245,000 people added to the Poor Law roll since September, 1931—perhaps somebody will tell us how much advantage that is to the community—and 306 persons out of every 10,000 of the population of this country are in receipt of Poor Law relief. In the county of Durham, one of the divisions of which the right hon. Gentleman represents, 667 per 10,000 are in receipt of Poor Law relief. I wonder if those who jeered at me just now, when they sit at home and listen to the wireless, have ever heard the gentleman who Has been sent round to visit these desolate areas up and down the country, and have heard the piteous stories which are told by him as to the conditions which he finds. A Press friend of mine said the other day that if we had any imagination in this country, we would gather together the very best writers we had, and send them broadcast through the land to write down actually what is happening in this country, so that the country could have a picture. I can give a word picture of what happens in my own division.

Everybody here knows, and nobody can contradict it, that these terrible, degrading, demoralising conditions, forced upon masses of people, are calling forth protests from nearly all the organised clergy throughout the country. I believe there is not a ruridecanal conference in an industrial area that has not put on record its opinion that the unemployed are being crushed both in body and soul by the conditions under which they are living. Medical officers in many parts of the country also bear their testimony. When questions are put to the Minister of Education or to the Minister of Health, some vague statement is made on the subject which means nothing at all, and they get round the fact that medical officers of health are reporting a steady deterioration in the children attending the schools. That has been repeated in this House, and no notice has been taken of it whatsoever. I know a school in Poplar where there is a very large percentage of the children having to be attended to because of the tendency to phthisis. Everybody knows that phthisis is, in the main, a disease which arises from poverty and overcrowding. If children are under-nourished and live under bad conditions, it is evident that they will suffer, and if you want to know the reason they are suffering, it is the atrociously low payments which are being made, and the forcing of people on to the family.

It is argued—I heard Lord Snowden argue it one day—that it is cheaper to keep them on these miserable doles than to find them work. I do not deny that you are saving money, but you are heaping up for yourselves conditions which, I am sure, this House will live to repent. Everywhere the physique of the people is going down. Before the War the same thing was happening, and you discovered it when you came to get recruits for the War. The number of C.3 men was enormous in relation to the population. If the Secretary of State or the Under-Secretary of State for War is here to-day, he can speak as to the number of men who, because they are physically unfit, are rejected by the Army, and this is growing, and has been growing for some time past. It means that the population is being forced to live under the real subsistence line. Then there is scarcely a day but one reads of suicides and murders, most of them attributable to sheer despair. Everyone read the story of a poor woman who was starved to death. I undertake to say that there are thousands of cases like that which never come to light. The doctor gives a certificate that death was due to consumption, bronchitis or influenza, whereas, in many cases, it is because of sheer starvation. And what else can we expect on the paltry sums that are given even under the ordinary rates of benefit? You talk about it being cheap. Is crime cheap? I read the other day in the Press that the crimes in London had gone up 200 per cent. How many are there that never come to light at all? The report of those in authority was that the increase was among the younger people. Can anyone wonder at this increase in crime among young people? It seems to me that you have got to set that against your money gain. You may have gained it at too great a cost in the life and well-being of the people.

The right hon. Gentleman and his Government take this line. They cannot pay any more money; they cannot give any bigger allowances; and, at the same time, they cannot set people to work. I will come back to that in a moment. The right hon. Gentleman, in his letter to Bethnal Green, and previously, said that there are these shemes for the rich people to help the poor, and that we must, in the main, rely on this to help redress the balance. Personally, I am built in the sort of way that if people are in trouble and I can help them, I am very glad to do so, and so I believe are all the Members in this House. I have nothing at all to say against anyone helping a person who is in distress in any sort of way, but when every night I have to face a poster going home on the Underground Railway appealing for my unemployed clothes to go to unemployed men, and read the various appeals, and I listen to the right hon. Gentleman over the wireless, I think it is disgusting, it is a disgrace, for the British Government to throw this on to the shoulders of private charity. It ought never to have been possible for any Prime Minister of this country to have done this. Let anyone go to industrial areas and ask how far this private charity is able really to touch the fringe of the question. It cannot begin to touch the tiniest bit of it. If hon. Members want to know whether that is so, let them hear what Lady Londonderry, in her appeal, circulated on behalf of the Personal Service League, states that some of her correspondents have said to her. I did not publish this; her ladyship has published it, and I think this House ought to take notice of it, because it brings very vividly to light the truth of the statement of the clergy and others to which I called attention just now. This is what the British Sailors' Society of Lowe soft said: We are exceedingly grateful to you and the members of the Relief Organisation for the two magnificent bales of clothing you have so kindly sent.…The distress is most keen. People cannot live on clothes. Many of them are not living; they are only existing. When I say that, I am told not to talk sob stuff. They are merely existing. That is the statement which is made by the representative of the British Sailors' Society at Lowe soft. Then the University Settlement, Shire hump ton, said: We found that mothers had cut up their underclothing for children. That is what the woman who gave up her food for her children did, and, having done so, died, and people can only sneer at it. [HON. MEMBERS: "Shame!" and "Withdraw!"] The hon. Member for the Sutton Division of Plymouth (Viscounts Astor) has just come into the House, and knows nothing at all about it.

Viscountess ASTOR

I know—


The statement goes on to say: men and lads were unfit to seek work for lack of boots and trousers; and some were in rags. These cases can be matched in every industrial area of the country. There is Don caster. A district nurse there says: I am a. district nurse in a very poor mining town, and nearly all my mothers are without clothes for the babies. Here is a statement from Cannock in Staffordshire: There is terrible poverty, women bringing babies into the world and no clothes to put them in. Girls unable to go to service because they have no clothes, and the women without shoes and clothes to wear. Here is another statement from Colwich: If only people understood and could realise that if you are unemployed you do not starve, but you have no money to replace clothes. In the Potteries the distress just now is terrible. This statement finishes with the slogan: We cannot escape our responsibility. That is what I want to say to the House of Commons. We cannot escape our responsibility. It is the responsibility of every man and women in this House; and I repeat that private charity will not even touch the fringe of the question. The few extracts which I have read prove conclusively what has been said from below and above the Gangway, that the Government are keeping the unemployed in a state of semi-starvation. The Prime Minister and Ministers in general have taken the line that public works are futile. No Socialist and no trade unionist has ever said that relief works are a cure for unemployment. We have never advocated mere relief works. The right hon. Gentleman, to his credit, was the first statesman in this country, as a Minister of the Crown, to bring forward a proposal that the working people of this country when out of work ought not to be driven to the Poor Law, and he issued a circular telling local authorities that they ought to take active steps to find useful employment for the unemployed. It is a disgraceful distortion of the truth for the Prime Minister to talk as if all the work carried out since 1920 has been a burden on the community. It has been no such thing.

In a previous Debate I interrupted the Minister of Labor and asked whether he would produce figures analyzing the expenditure of local authorities, assisted by the Government, on roads, railways, gas, electricity and parks since 1920. The notion which the Minister of Labor tried to suggest that this money was all wasted is so much arrant nonsense. He knows that money spent on housing and on other public works is not wasted. We heard from the right hon. Member for Hill head (Sir R. Home) the other evening that had it not been for the action of the previous Government of the right hon. Gentleman the Prime Minister the tube developments which are now taking place would have been impossible. But all the money which has been spent in this way is piled up in a lump sum and treated as if it was money which has been thrown away on made work. It is not true. It has been spent on works of public utility, which are of service to the nation. I am not going to take it from the Prime Minister that the money spent on the housing estates in Poplar, which he inspected, has been money wasted. It is remunerative in many ways. It has been spent for the well-being of the community, and will give a return not only in better housing of the people but in better health. The Government have shut all this down and say that they cannot now carry on such work.

The hon. and gallant Member who opened the Debate yesterday, and also the hon. and gallant Member for Harrow (Sir I. Salmon) asked that works of this character should be put in hand. The hon. and gallant Member for Harrow said that he would support the building of public offices. I do not know how much money you are going to make out of that type of building; but if I had proposed it the Chancellor of the Exchequer would have poured scorn upon it and would have asked what return we were likely to get on the expenditure. But last night, Mr. Deputy Speaker, you had to rule out of order a Bill which had passed all its stages in this House except Third Reading because the Government have determined that the grant which was to have been given shall not be given. A bridge or a tunnel is absolutely necessary on the Humber. There is some disagreement as to whether it should be a bridge or a tunnel, but the grant for the work has been stopped simply because of this craze for economy, which in this particular case is sheer madness. Work on the Dart ford tunnel and at Alexandra Palace has also been stopped. While it is true, as the Prime Minister said, being a good Socialist, that unemployment is inherent in the capitalist system, we repudiate altogether the doctrine that the work on housing, drainage, the prevention of floods, the sweeping away of slums, the reconstruction of railways, work on idle land, the growing of food and the reorganisation of transport, is not good and useful work. We say that at a time when ordinary industry is in a bad way such work ought to be undertaken. There are some things which you can hold over when trade is flourishing, but when trade is bad these are the sort of occupations which should be taken up.

I am not going to apologise for speaking about agriculture. The first speech I made when I entered Parliament in 1911 was on this subject, and I said then what I say now, that if this country is in a bad way from the point of view of employment there is one field to which you can apply. If you desire to balance trade and to stop imports because you are unable to send out exports, if you say that you must develop the industries within this country, then agriculture is the one industry which should have been taken in hand long ago. I shall be told that the Minister of Agriculture has a lot of schemes up his sleeve. He has a lot of committees. We used to be criticised about the number of committees, but this Government have gone one better, they have a committee every other day. The fact is that not a single extra man has been found employment on the land during the year and not a single acre more has been brought under cultivation. If you want to stop imports surely you ought to find work for the men at the docks and the mines, who will be displaced, by reorganising the land system of the country. The Government have done no such thing.

Let me deal for a moment with the question of unemployment as a world problem and as a national problem. It is perfectly true, as the Prime Minister has said, that unemployment is inherent in the capitalist system. In America they have appointed a committee to investigate the causes of unemployment. It is the same in other countries. Unemployment is rife in every civilised country of the world; whether they are on the Gold Standard or off the Gold Standard, whether they have balanced their Budget or whether they have an unbalanced Budget, whether they are Protectionists or Free Traders, whether they are self-contained or, like ourselves, are dependent on the outside world. Unemployment is common everywhere, and every student of the problem knows that it does not matter whether a country is Free Trade or Protectionist. I am surprised that the hon. Member for Stockton-on-Tees (Mr. Macmillan) is continually raising this question with the Labour party in these discussions. It is not a question as to whether you are Free Traders or Tariff Reformers. Whatever you are you have unemployment arising from a cause which is well known, and that is the abundant power to produce and the failure to consume within your own country, or outside your own country.


The right hon. Gentleman has misunderstood my remarks. All I did was to call attention to the conflict of views between the official Motion today, objecting to any restriction of trade, which presumably is a free trade policy, and the official policy of the Labor party put forward in August, 1931, for complete control of trade by the setting up of import boards.

Viscountess ASTOR

Hear, hear.


The hon. Member and the hon. Member for the Sutton Division had better read it again and think a little more. Our position is perfectly simple.

Viscountess ASTOR

Hear, hear.


Your mother ought to have flogged you badly. There is no contradiction in our policy.

Viscountess ASTOR

On a point of Order. Does the right hon. Gentleman really believe in people flogging children?

Mr. DEPUTY-SPEAKER (Sir Dennis Herbert)

The Noble Lady has been long enough in this House to know that that is not a point of Order. Hon. Members are not entitled thus to interrupt a speech by raising as a point of Order what is not a point of Order at all.


I wish to reply to the hon. Member for Stockton (Mr. Macmillan). It is perfectly true that we believe in the national organisation and control of industry, even if that involves controlling imports or exports. Whatever it involves we stand by it. But what the Government have done by the Ottawa Agreements has been to restrain and restrict trade even within the system under which we are working—to restrict the flow of imports and exports between countries. We voted against it and told the House the reason why we voted against it, although some Liberal Free Traders voted for it. In America this question of the causes of unemployment has been considered. This House will never get to grips with unemployment until it considers what are the fundamental causes of unemployment. We have the transport world agitated because a new means of transport on the road which has come into being conflicts with the interests of the railways. Now I read in the Press a statement that we are to have fleets of aeroplanes to carry passengers from the towns to the seaside, and there will be another complication. We find that sort of thing everywhere.

I find that I am up against this: If I ask for reorganisation for agriculture, or of mining, or of cotton or of iron and steel, I am told that reorganisation will inevitably create a bigger production with less labour. That is true of every industry. In America, Mr. Hoover or a committee that he appointed, has worked out a set of figures, and here are some samples. The old-fashioned brick-maker never produced more than an average of 450 bricks per day. The modern brick plant can produce 400,000 bricks per day per man employed. Think of the difference. One hundred men working five modern brick plants can to-day manufacture all the brick that the United States is able to use in any one year. That is one fact. The adult population of North America could supply all its material wants by working four hours a day for four days a week. A century ago pig iron was produced in the United States at the rate of 25 tons per man per year. In 1929 there were blast furnaces producing it at the rate of 4,000 tons per man per year. A farmer with modern agricultural machinery can now accomplish in one hour what 3,000 hours were required to do a century ago. Between 1920 and 1929 the United States increased its manufacturing production by 36 per cent., yet during the same period the number employed in the factories actually declined by 6 per cent. Nearly half the present estimate of unemployed, now calculated to embrace one quarter of the entire working population, would not be reabsorbed in industry even if the American factories resumed their peak production of 1929. A rayon plant that has recently been set up in New Jersey runs 24 hours a day without any human aid whatever. Here is a quotation: The question thus inevitably arises whether it would ever again be possible, within the bounds of the present economic system, to provide work for the bulk of those wanting employment, and, if not, how order and prosperity can ever be hammered out under the present economic system. I think everyone in the House must agree with that statement. But what are the Government doing, what do they suggest in face of that situation? By the speeches that they make and the committees they set up they admit that this is a matter for the Government. They cannot now fall back on the old doctrine that prevailed in this House, that the handling of business and commerce was entirely a private matter. The right hon. Member for Hill head (Sir R. Home) said the other night that the chaos and confusion of London traffic must be dealt with, and that was why he supported the London Passenger Transport Bill. But what about the chaos and confusion in the industrial world and the world of economics? It is just as bad everywhere, and as far as I can see, it is not proposed to do anything, in this House anyhow. I see on the Order Paper a Motion that I would like very much to hear discussed. While I am not sure what it really means I would like to hear the Prime Minister and his friends explain it. If necessary, we could give up a day or two days that would otherwise be ours. This is what the Motion states: That in the opinion of this House there is urgent need for a comprehensive plan providing for the organisation of national industry under the advice of industrial councils"— That is a bit Socialistic, if it is not Socialism— the co-ordination of financial, industrial and political policy"— I would like to see that argued out, and to know what it really means— through the assistance of a representative investment and development board "— When we said something similar to that hon. Members opposite put it across the wireless that not the walls of Jericho, but the walls of capitalism were falling about our heads; but when hon. Members opposite say it, it is all right— and the raising of prices to an economic level by methods which would include (a) controlled monetary policy"— Talk about Daniels come to judgment. You are a lot of little Daniels. It is what Lord Snowden told us would be "Bolshevism run mad." I see the hon. Member for Winchester (Sir G. Ellis) is present. He is associated with this Motion, which goes on— (b) the attraction of new capital into the channels which would produce a better equilibrium in production, and (c) the provision of credit facilities for desirable developments for which the necessary capital cannot be readily obtained under the existing methods of banking and issuing houses.




One of the names attached to this Motion is "Sir Geoffrey Ellis." That is the hon. Member.


I hope that the right hon. Gentleman, in referring to a Resolution which is on the Order Paper, will not hold out an invitation to the House to discuss it.


I said that I would be willing to give up a day, or even two days, which we might have at our disposal in order that this Motion might be discussed. I mean in the future, not today, oh, no.


I heard the right hon. Gentleman quite clearly, and I Was hoping that in reading the Resolution he would not interpose remarks about it which might make it difficult for hon. Members who follow him not to discuss it.


Honestly, if I thought I was departing from the Rules, I should have gone into some of these matters as matters relating to unemployment and matters which it is very neces- sary to discuss. The Motion I have read proves that in this House and in the City and amongst business men there is a conviction that the economic system under which we are living must be changed, and changed fundamentally. The proposals in the Motion I have read are fundamental proposals. I hope that the Government will not give us a complacent, self-satisfied statement that things are not as bad here as they are in other countries, or as they might have been if the Prime Minister and the Dominions Secretary had been at the head of a Labor Government. That is no consolation to the unemployed and is no answer to our case. Our demand is, first, that the condition of the unemployed who cannot be absorbed either by public works or in any way, should be improved. I have always held that the number of unemployed does not lessen the need of the individual unemployed man. Whether there are 1,000,000 unemployed or only one unemployed man, the need of the one unemployed man and the need of the 1,000,000 are equal. They all have to live; their wives and their children have to live, and the rent has to be paid.

There is in this country at the moment abundant work to absorb many thousands of the unemployed. There is unemployed money. We are told that by the bank managers and others. There is unemployed land; there are unemployed raw materials. The thing that stops us is that the Government have what is from my point of view the insane theory that it is not as advantageous to spend money in that way as to spend it in a private way, that is through private employers. If we spend £5,000,000 on clearing slums away from a municipality I do not see the difference between spending the money in the way I have indicated and handing the money over to be spent by private individuals or private organisations. You circulate the money and the only difference that I can see is that you may get a better job done under public enterprise than under private enterprise.

When we ask for national ownership and national organisation of industry we claim that these are the only means whereby you can, within the limits of scientific production, bring about scientific consumption. If the world is to come out of the crisis in which it is today, it must be by means of a new basis for industry and a new basis for the relationship of men and women to industry. It must be by the use of scientific power in order to produce for the uses of mankind and not merely for private profit. At present it is private profit which stands in the way. People cannot make money individually out of the building of houses. People cannot make money in this country out of the growing of food. Yet it is true that houses are wanted and that food is wanted and we say that if the community takes control of these things it can bring production and consumption to match one another.

4.48 p.m.

The CHANCELLOR of the EX-CHEQUER (Mr. Chamberlain)

Once more the House has before it an official Opposition Motion of Censure on the Government in connection with unemployment. I wonder how many official Motions of this kind have been moved by successive Oppositions against successive Governments in successive Parliaments since the beginning of the depression. There have been so many of them that we have lost count of the number and all have been characterised by certain common features—first the ascription by the Opposition to the Government of the sole responsibility for unemployment—[HON. MEMBERS: "No"]—or, as in the present case, the sole responsibility for the increase in unemployment; the rejection by the Government of the day of that responsibility and its attribution to world causes; a general, in fact a universal sympathy with the unemployed coming from all parties and in the end a continuance of the unemployment. After so prolonged and painful an experience of this great series of discussions it might well be thought that there was nothing more to be expected today than the iteration and re-iteration of the old arguments and the old rebuttals and that if anybody expressed any hope that improvement was in sight or was about to set in that could only be set down to a sort of dogged optimism which refused to take into account the evidence.

We certainly must admit that the optimism which is felt today must be of a qualified character, and yet I think that a qualified optimism is not only more cheering but more appropriate to the present circumstances than the unqualified pessimism which has just been expressed by the right hon. Gentleman. Perhaps the difference between the attitude which he takes up, the outlook which he has expressed, and that which I consider to be more correct is to be found in the fact that when we come to consider what is to be done the right hon. Gentleman has no contribution to make except the old one that we have heard so often, the one that has failed already, the one comprised in the Motion, that once again we should begin to splash money about in the hope of finding in that way means of absorbing the unemployed, or else that we should change the whole system and substitute Socialism for Capitalism. How long is that going to take?


Ask the Prime Minister?


What, I would ask the right hon. Gentleman, are the unemployed going to do in the meantime?


You tell us now.


The right hon. Gentleman would be more effective if he kept away from the purely personal line which inspired nearly the whole of the observations which he addressed to us. Surely we may reserve personal vendettas for less serious subjects than that which we are considering now. As far as the Government are concerned, they are convinced that the long experience which the country has now gained of the efforts of their predecessors over a series of years has enabled the country to distinguish the true policy from the false. They are further convinced that there exists to-day sufficient evidence to show that we are, at last, upon the right road. I, for my part, welcome the opportunity which the Opposition have given us to state as clearly as I can the aims of the Government in dealing with the unemployment problem, the methods which we have in view to achieve that end, and the reason why we have departed from the policy followed with varying degrees of enthusiasm by our predecessors.

On the Paper there is not only the official Opposition Motion, but an Amend- ment to it in the name of the right hon. Gentleman the Member for Darwen (Sir H. Samuel). There is much in that Amendment to which I see very little reason to take any exception and, indeed, the matters mentioned in the latter part of the Amendment are all matters which, if judged upon their merits, are certainly worthy of support and some of them form portion of the declared policy of His Majesty's Government. But if hon. Members look at the first words of the Amendment they will find it clearly implied there that these proposals are put forward as a practical contribution towards the solution of the unemployment problem and as being likely in the long run to enable us to provide for a reduction in taxation. While, as I have said, on their merits these proposals are deserving of support, yet when they are put forward in that way as a remedy for unemployment they seem to fall into exactly the same fallacy, though perhaps not to the same degree, as the vague and sounding phrases of the Opposition Motion. The right hon. Gentleman opposite has recently become a convert to the doctrines of Signor Mussolini—a quite unexpected development on his part.


When was this?


I saw in an article the other day that the right hon. Gentleman spoke with approval of the policy which he said had been advocated by a distinguished Italian statesman. I venture to say to him that it is always dangerous to apply to one country remedies which may be very suitable for another country where the conditions are quite different. It is true that we have been advocating and operating relief works of one kind or another in this country for the last 12 years. So long as we could cling to the idea that unemployment was only a passing phase and that therefore all we had to do was to provide some temporary employment until normal times returned, so long it seemed a very reasonable proposition to consider the advisability of anticipating needs which would normally not arise until a few years hence. But I do not think that any thoughtful Member of this House now believes that the mal-adjustments which have brought about this world-wide unemployment are likely to be corrected so rapidly and so completely that we can look forward with any confidence to the reduction of unemployment to a comparatively small figure, within, shall I say, the next 10 years.

As a matter of fact, we have already exhausted practically all we can do by way of anticipation of needs and that remedy is no longer open to us. I go further than that. The right hon. Gentleman has been to a large extent basing his denunciation of the present Government upon a misrepresentation—I am not saying a willful misrepresentation, but perhaps I might say a misunderstanding of the Government's position. He has said that the Government are of opinion that no public works of any kind ought to be undertaken. We have never said anything of the kind. What we are saying is that the provision of public works for the purpose of providing a remedy for unemployment has been tried out and has failed. The right hon. Gentleman says it has never been tried out.


I said that nobody ever proposed it from this side.


I am not interested whether the right hon. Gentleman proposed it or not, but I am interested in the question as to whether it is a practical remedy, and for that purpose I have tried to make a rough calculation of the sum that has been spent over a period of years in State-assisted works for the purpose of providing employment and for the development of various activities of local authorities, and I find that from April, 1924, down to September, 1931—that is, about 7½ years—the capital value of works of this kind, including housing, was about £700,000,000.


Including roads?


Yes, including roads, but capital value only. I am not speaking of maintenance.


Would the right hon. Gentleman give us, as I asked the Minister of Labour to give us, an analysis of that £700,000,000, showing just what it has been spent on? It is very important that we should know. I do not mean now.


I will not give a complete analysis—I do not really think that is necessary for the purpose of my argument—but I will give some analysis, a broad analysis, and it is as follows: £450,000,000 was spent on housing.


Is that waste?


The right hon. Gentleman still misunderstands the position. It is not a question of whether it is waste or not, but of how much employment has been provided and how far it was a remedy for the problem of unemployment. I hope presently that I shall get him to take in the argument. Of the remaining £250,000,000, £90,000,000 was capital expenditure upon roads, £120,000,000 was in unemployment grants, and £40,000,000 was in grants by the Lewis Committee. That makes the total of £700,000,000—£250,000,000 besides the expenditure on housing,


By unemployment grants does the right hon. Gentleman mean expenditure by the Unemployment Grants Committee?


Yes. There is an enormous sum of money which in 7½ years has been poured out and what effect has it had in reducing unemployment? I confess that I was astounded to find that the average number of men directly employed through, the expenditure of this money was only 90,000. The actual peak was reached during the period of office of the late Labour Government, when it rose, as has already been pointed out by my right hon. Friend the Prime Minister, to 114,000.


Directly employed?


Yes, directly employed, but double it if you like, and put in the indirectly employed as well. That gives an average of 180,000; and what was the result on the total figures of unemployment? At the beginning of the period the unemployed were 1,250,000, and at the end of it they were 2,800,000. I cannot think how any thoughtful and intelligent person considering those figures can come to any other conclusion than that the expenditure of all that money—some of it remunerative in money and some of it remunerative, let us say, in health or in the general well-being of the people, but other parts of it completely unremunerative—did not even touch the fringe of the unemployment problem, but indeed left it worse than it was before. Therefore, I say that it is criminal folly to pursue that policy; to pursue it in the hope of deluding people into thinking that a policy which has continuously failed in the past is suddenly going, by some miraculous change, to succeed in the future, is a policy which certainly this Government will not support. No, it is the deliberate opinion of the Government that that policy has failed and that we must have done with it once and for all, and that is an opinion held unanimously by the Cabinet, held, that is, by men who have all tried this policy in one degree or another in the past, in separate parties, and who are satisfied now that the policy, if it ever was applicable to our conditions, is no longer so applicable.


I can see some of your colleagues looking rather concerned about that statement.


Now I want to make, not a qualification—I have nothing to qualify in the statement I have made—but an addition, because it is so easy to misunderstand, especially when you are not very anxious to understand, and it is highly desirable that in this matter the Government should not be misunderstood. I ask the House not to read into my statement more than I have said. The hon. Member for Stockton (Mr. Macmillan) yesterday used some phrase to the effect that we have now put the plug in the bath, and he thought it was time to turn on the hot water. One of The functions of the Chancellor of the Exchequer is to try to keep the House and the country from getting into hot water, and sometimes he has to put in cold for the purpose, but I do not want him or any other of the supporters of the Government to suppose that our attitude in this matter is one of rigid theory, or that we have not got exactly the same realisation as any of them may have that there may be cases, and indeed that there must be cases, where it is possible for the Government, in one way or another, to stimulate industry and, on its merits, to help forward a scheme which will give us an economic return.

My right hon. Friend the Minister of Health yesterday removed, I trust, any misunderstanding which may have existed as to the attitude of the Government towards local authorities. Undoubtedly there are many works which could properly be put in hand by local authorities today, and certainly nothing that has been said or done by the Government ought to deter them from making applications for loans. I think myself that we have spent in the past a great deal more money upon roads than we could properly afford, but I am not prepared to say, although we certainly are not going to embark on another great programmed of road building, that there are not cases where, very properly and usefully, we might spend money upon the completion of a work which is not yet completed; I am not prepared to say that there are not cases now where the replacement or the alteration of a bridge might remove a bottle neck or an obstruction to traffic; I am not prepared to say that there is no expenditure which might properly be undertaken by Government Departments in replacing or in altering buildings which are inconvenient and do not offer a possibility of carrying on work effectively and economically; I am not prepared to say that it is not possible to develop, at an even greater rate than we are doing now, the telephone programme of the Post Office. All these are matters which are constantly under review by the Departments in conjunction with the Treasury, and I assure hon. Members that there is no Member of the Government who is freer from prejudice in these matters than I am or who is more anxious to view all these questions, not from the point of view of a rigid and unyielding economy, but from the point of view of common sense.

I might give another instance of the sort of thing that I have in mind, in connection with the express vessel which was laid down for the Cunard Company and work on which has been suspended. The Government have given a great deal of time to the examination of the position in relation to that ship, though I was sorry to see the other day definite statements in the Press about the resumption of work upon the Cunarder, which certainly were not justified by any of the facts. Yet it is the case that the Government have not shut the door to assistance in some form or another which would enable the completion of that vessel, but the assistance would have to be dependent upon the fulfilment of certain conditions which would seem essential to us if the objects for which the vessel was originally laid down are to be attained. Those conditions would include, among other things, the consolidation of existing British interests. I do not think that at the moment I can say more upon that subject usefully, except that the matter is being actively pursued, but I hope I have said enough to show that in all these matters what are guiding the Government are the merits of each individual case. I want, to prevent any possible misunderstanding, to repeat that, while we believe that the merits of a case may justify assistance by the Government, we cannot and must not expect that schemes of this kind, although they may attract a large amount of popular attention, are going to make any appreciable effect upon the major problem of unemployment.

The right hon. Gentleman dealt with one other matter about which I ought to say a word at once. He quoted some very interesting figures from an American report, which I dare say many of us had seen before. There is not the slightest doubt that the displacement of labour which is going on in every industry, and in agriculture as well, throughout the world, and which cannot be stopped, constitutes one of the greatest problems that lies before the civilised world in the immediate future. There has been a dislocation of the old equilibrium, and somehow or other a new adjustment has to be arrived at. That is not a problem to be solved in five minutes. It is one of the most difficult problems that you can approach, and it will attract the best brains in every country before a final solution is arrived at. In the meantime, there must be a transition period in which things will be very difficult, and unemployment will be largely increased by the operation of these causes. The right hon. Gentleman has no right to say that a delegation of the British Government went to Geneva and opposed a proposition for a shorter working week. If he has read the report of what took place at Geneva he must know that it is an altogether misleading description of what took place. In case he has not read it, I will read it now. Here is an extract from the report of the Preparatory Technical Conference on Hours held at Geneva: The British Government delegate stated that his Government considered that the question of the compulsory limitation of the hours of work to 40 a week had not yet been sufficiently examined to warrant a definite conclusion being reached, and that therefore his Government were opposed to proceeding at the present time with the project of a draft convention. He pressed for a comprehensive inquiry into the whole question before any definite action was taken. [HON. MEMBERS: "Hear, hear!"] We are to take it from those triumphal cheers that the right hon. Gentlemen and hon. Gentlemen opposite would at once proceed to the adoption of a draft convention before they made any inquiry as to what that might mean. It has not even yet been decided what effect it will have on rates of wages, and I do protest against the right hon. Gentleman so misrepresenting the attitude of the Government from purely party motives when every sensible trade unionist knows that to interfere in this delicate matter which connects and must connect hours of work and rates of wages without having decided what would be the effect upon the competitive power of British industry is sheer folly and lunacy.

What is the Government's policy in regard to unemployment? There is no vagueness about our aims or about our methods, although, of course, in matters of this kind, where we are dealing with forces which operate over a large part of the world, it is not possible for us to do everything without co-operation with other countries. I will define what our policy is, for purposes of convenience, under four heads, although I must say by way of warning that one cannot exactly divide it in that way because one head almost insensibly slides into another. The first essential towards the recovery of trade and increased employment is the restoration of confidence. I do not think that I say anything controversial when I state that in September, 1931, confidence in this country, in regard to both people in this country and people outside, was very badly shaken. Memories are so short that it is as well to repeat that at that time we actually had to borrow £130,000,000 in France and America in order that we might keep our currency from going out of control. Therefore, the first aim of the Government is to restore confidence. Can anybody say that we have not already to a large extent succeeded in that aim?

The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) who, after delivering a speech an hour long in the Debate yesterday, has not thought it convenient to come here to-day—[HON. MEMBERS: "He has been here."] Where is he now? The right hon. Gentleman said that in his conversations with various people he could find nothing to justify any hope that things were really getting any better. I have heard him say that so many times before. In conversations of that kind a great deal depends on the way in which the questions are put. It is a curious thing that in the conversations I have had I get exactly the opposite reply. I am told on all hands that while the actual amount of business to be recorded moves only slowly upwards owing to a variety of obstacles, and particularly perhaps to the difficulties of obtaining payment from foreign customers, there is everywhere greater confidence among the buyers. As to the condition of things abroad, so far from having to borrow money in other countries, we are today embarrassed by a sort of flight to the pound which, if it were not for the existence of the Exchange Equalization Fund, might easily lead to fluctuations in the exchange value of sterling of a temporary character which would cause great embarrassment to our trade.

What is the explanation of this return of confidence? In the first instance, it was derived from the cessation of borrowing to balance the Budget—an operation, by the way, which some who have not my responsibilities are now urging upon me under the specious plea that it would be an act of boldness and courage. It was derived not merely by the balancing of the Budget, not merely by our economies and the imposition of extra taxation that we restored confidence; it was by the positive step we took to check the trade balance and to stimulate industry. By the Import Duties Act we regained control of the home market, and as the result of that the House is aware that the excess of imports over exports of merchandise was reduced by £120,000,000.


Did not the depreciation of the pound have anything to do with that?


It had something to do with it, but not the major part.


It was by far the major part.


That is not a matter which is susceptible of proof. Then the success of the Ottawa Conference, in spite of the gloomy prognostications which were made by some of those who did not wish to see this country make agreements with other countries of the Empire, helped to restore confidence. Then the cheapening of money which followed upon the great Conversion Loan operation has also contributed greatly to the same result. Our success is not complete; how could it be with the world as it is in present conditions? Checks and disappointments are inevitable, but they should not lead us to be discouraged. The right hon. Gentleman the Member for Carnarvon Boroughs yesterday told a story of how during the War, when things were not going very well, he asked a distinguished general: "How long is this War going to last, and when will it end?"


"By what means will it be brought to a conclusion?"


I am much obliged to my right hon. Friend. What was the answer he got? It was, "Keep pegging away." The right hon. Gentleman did not say what his comments upon that answer were at the time, but I can imagine them. To keep pegging away was the thing to do, and in the end it won the War. Today we have to keep pegging away if we are to succeed in bringing about trade recovery. We have had a disappointment about inter-governmental obligations. The right hon. Gentleman spoke almost with glee of the fact that no single nation had yet ratified the provisional agreement arrived at Lausanne. As a matter of fact, nobody expected that that agreement would be ratified by any nation at this stage. It has been said that I am surprised and disappointed that the United States Government was not able to agree to the suspension of the payment due last December. That was a set-back, just as we had set-backs in the War; but the right hon. Gentleman did not despair then, and I see no reason why we should despair now. Keep on pegging away. Even though we may from time to time find that we are not getting on as fast as we should like, nevertheless, if we persist we shall get there in time. I suspect that the right hon. Gentleman has changed his views, not because he is 15 years older than he was then—though it is difficult to see that he is—but because he was then in charge of national affairs and now he is not.

My second head is that we have got to raise wholesale prices. We must raise gold prices if we can, and, in any case, we must raise sterling prices. I am not now going to enter into any argument about how that can be done. The House knows there are two views upon that subject, and that one thing which is certain is that no steps that have yet been taken to that end by any country have been successful. Nevertheless, there is one case in which we here have been able to act without any assistance from other nations, or at least with assistance only to a limited extent, and that concerns meat, because ours is practically the only market for surplus meat. The arrangement made at Ottawa for the voluntary regulation of the production of meat, an arrangement which was extended after we came home, has already achieved an amount of success which encourages us to think that it might be extended with advantage to other commodities.

As to other methods of raising prices, they are really involved in my third and fourth heads, which are respectively "The provision of cheap money" and "International co-operation." Regarding money, I think it will be generally agreed that while the provision of easy credit and low interest rates will not, of themselves, suffice to produce trade recovery, yet they are an essential precedent to trade recovery. I do not think anybody will deny that we have at any rate provided cheap money. The House may be interested in these figures, which illustrate what happened to the rates of interest during last year. I have a table which compares the rates of interest in January, 1932, and January, 1933. The Bank Rates was, at the first date, 6 per cent., and it is now 2 per cent. The Treasury Bill Rate was 4.982 per cent., and it is now .768 per cent. Three months fine bank bills, 5.56 per cent. in January, 1932, now 88 per cent. Day-to-day money, 4.19 per cent., now 7 per cent. The long-term rate of interest, as measured by the yield on buying 4 per cent. Funding Loan in the market, was 5.01 per cent. in December, 1931, and 3.55 per cent. in December, 1932. That is a direct result of the Conversion Loan.


Was not the Conversion Loan just one item among others?


I cannot enter into a discussion on that point now. I say this table shows the very striking contrast between the rates of interest prevalent at the beginning of last year and at the end, I need hardly add that the present rates are the lowest since the end of the War. It is satisfactory to be able to say that, so far as we can see, the long-term rate may be considered almost as a permanent acquisition, and so far as the short-term rate is concerned it is likely to continue for a very considerable time. Some people would say that an abundant supply of money is even more important than cheap money. In order to test that we have to look at the bankers' deposits at the Bank of England, and at the deposits at the Joint Stock Banks. Bankers' deposits, which in 1931 averaged £64,700,000—not a very different figure from the preceding years—had in 1932 reached £81,300,000, and in January, 1933, they averaged nearly £114,000,000. The deposits of the public with the London Clearing Banks in January, 1932, amounted to £1,714,000,000, and in January, 1933, had risen to £1,983,000,000. Although 1932 was a year of great conversion operations, and therefore not a particularly favourable period for new issues, still, it is not unsatisfactory to see that new capital issues for industrial purposes in the United Kingdom, excluding local authority issues, amounted in 1931 to £32,900,000 and in 1932 had risen to £75,900,000.

It may be asked, "With all this money lying idle, why is it not used? "The answer to that is, "Because confidence has not yet been wholly restored, and because of the international barriers to trade which prevent the use of that money." It is in order that we may try to get the international barriers if not removed at any rate lowered, that we have urged and done all we could to promote the calling of an international conference. I know that some people get disheartened by the delays, jealousies and cross-currents which always seem to arise at international conferences so that they are sometimes inclined to say, "Why not give them a miss, do without them altogether, and see if you cannot work entirely within your own boundaries." That is a policy of despair. If these international questions are to be solved, it can only be done by international co-operation, and to those who say, "Then, are you going to wait until it is possible to convene this Conference, which is so frequently put off?" our only answer must be "Yes, we must wait until it is possible to convene that Conference," but if in the meantime we are making any progress towards a better understanding with other nations on the subjects which will be discussed at the Conference, then the time is not wasted, because when we come together we shall be nearer agreement and will find it easier to come to a conclusion. It is a hopeful sign that the Preparatory Committee of experts which met at Geneva were able to secure so large a measure of agreement upon a series of subjects upon which there was every reason to expect that there would be wide divergences of opinion.

So I claim on behalf of the Government that this policy which I have set forth under these four heads is not only a constructive policy, not only an intelligible policy, but is already producing results which can be seen and which justify us in saying it is the right policy. When we come to examine the situation we must always remember the background against which it is to be measured. All the industrial nations are being carried along, like logs on a Canadian river, by a stream of forces bearing us down the valley of depression. All of us are fighting against the current, and if we want to see whether the methods of one nation are better or worse, or more or less successful, than those of another we must not merely look at the bank but look to see also whether we are overtaking them or they are overtaking us.

I ask the House to consider these few figures dealing comparatively with employment, with production, with exports and retail trade. As to employment, in 1932 the numbers of the unemployed in this country averaged 2,813,000, an increase of 3 per cent. over the figures for 1931. In Germany they averaged 5,561,000, an increase of 22 per cent. over 1931. Insured persons who were in employment in the United Kingdom in 1932 showed a decrease of 1 per cent. over the preceding year, but the index of persons employed in manufacturing industries in the United States during the same year showed a decrease of 17 per cent. In the case of production, during the first nine months of 1932 production in the United Kingdom showed an increase of 1 per cent. over 1931. The figures for the United States showed a depreciation of 25 per cent., in Germany 22 per cent. and in France 55 per cent. The volume of exports of the United Kingdom was slightly higher last year than in the year before. Germany's exports were 30 per cent. worse. During the first nine months of 1932—the only period for which I have the figures—they were 21 per cent. worse in the United States, and in France during 1932 they were 24 per cent. worse. In the case of the retail trade, the latest returns show that the value of that trade in the United Kingdom fell by only about 4.7 per cent. in the United States by 25 per cent., and in Germany 19 per cent.; while, if we take the volume of the retail trade, it was steady in this country and in the other countries was down about 10 per cent.

In view of those figures, which show that at least we are not going down the stream like other countries; in view of the vast and admitted improvement in the condition of this country compared with last year; in view of the restoration of confidence which is apparent everywhere except when the right hon. Member for Carnarvon Boroughs is present, I ask the House not to be tempted into thinking that short cuts are a better policy than the one we have been pursuing. Short cuts are often the longest way round. I have told the House that the Government are fully alive to the possibilities of stimulating trade where suitable opportunities arise, and that they are not going to be hypnotised by any preconceived ideas or theories. I suggest to hon. Members that we cannot succeed in our aims by any panicky or hysterical changes of policy. What we have to do is to keep pegging away, as the general said, and trust to persistent and consistent efforts; and, above all, we must sustain our courage and our determination.

5.44 p.m.


I will only venture to detain the House for a short time, because I had not intended to intervene at all until I heard some of the statements which fell from my right hon. Friend the Chancellor of the Exchequer. I must say I think something should be done to express the feeling of disappointment, and even of hopelessness, which must have arisen in many hearts as he proceeded upon his precise, well marshaled, orderly discourse. What is the picture that he puts before the House and before the country? What is the proposition? It is that everything is being done that can be done and that all is proceeding satisfactorily and in due course, but that, in spite of all this, many years must pass before the figures of unemployment can be reduced to—I think he said—a small figure. That is a ghastly prospect for us all to have to face, and it was that phrase of the right hon. Gentleman's that induced me to trespass for this moment upon the time of the House.

Ten years! Is that the last word of His Majesty's Government? I rejoice to think that by the unexampled provision which this nation made for the relief of distress through insurance schemes and otherwise, and by the faithful performances of the taxpayer, material distress is to a very large extent withheld from our people, even in this terrible time, but material distress is not the whole evil of unemployment. There is this frightful moral agony of unemployment. Take the case of the 3,000,000 unemployed. You are not merely dealing with the weaker brethren, with men who hardly ever keep a job, but you are dealing with a couple of million men who have hardly ever been out of work in the whole of their lives. Take these men. I see the figure of the breadwinner, the father of the family, sitting in his chair in his cottage. Ten years! His wife has perhaps got a job —perhaps she has got his job—and his daughter may have got a job. His son, a young boy, may have got some blind-alley occupation. The father of the family, whose honour and faith are pledged to carry those dependants on his shoulders, sits there in his chair, a burden upon the house, helpless in the midst of those whom he had vowed himself to defend, his very right to exist challenged in the land for which, perhaps, he had been ready to sacrifice his life not many years ago. It is no good going to that man and saying: "Keep pegging away!" What has he to keep pegging away at?

I am not impressed by the argument of the Government, neither with those which were used by the Minister of Health yesterday, nor with those of my Tight hon. Friend the Chancellor of the Exchequer, that all measures of stimulating or subsidising production in one form or another ought to be ruled out at this time, because they have failed in the past. I do not think that it is true to say that they have failed. They may not have stemmed the enormous world tide of unemployment, but they may have mitigated it. In fact, you can show that they have to a certain extent mitigated its force. Naturally, if you have a great world tide of unemployment flowing, you will be able to show a much larger total of unemployment at the end of the year, although you may have received benefit from those measures. I deprecate altogether the non sequitur that because unemployment has increased while remedial measures were employed such measures should no longer be adopted. I think that the Government would have been very well advised last August in taking some steps to open up, as far as they could, the building trade and the development of public works. There are some very well-known, great public works, one of which I see was destroyed last night, and which at any rate would give us a better island to live in after they were completed.

I would not for a moment ask the Government to perform impossibilities or to reproach them, because they cannot cure unemployment, but unemployment has only increased about a quarter of a million in the last six months. It would have been quite possible, by taking prudent steps last summer or last autumn, to take that extra 250,000 off. It would not have rid us of the evil and it would not have solved the problem, but it would have given the Government the right to say that they had stemmed the tide and that there was a diminution, however small, and not an increase, in unemployment. Believe me, an event of that kind would have a far greater effect upon your credit, upon your national prestige and upon the reputation and authority of the Government, than anything you will get out of a £50,000,000 Sinking Fund, however strictly and punctually it is enforced. It would not have been a reasonable thing to embark on another large, bold programmed at a time when there was public panic, as there was in 1931. Of course, you could not do it when there was a great conversion operation, but all could have been put in readiness, and I am bound to say that nothing that I have heard in this Debate has shaken my view that it would have been a wise and reasonably prudent step, justified on the highest economic and on the broadest grounds of long policy, to have set on foot a programmed sufficient to have brought a quarter of a million mere men into employment at this moment.

I entirely agree that these are but palliatives. What I felt in the speech of my right hon. Friend the Chancellor of the Exchequer was the hopelessness. I greatly preferred his speech, with its carefully considered and marshaled arguments, to the Prime Minister's broadcast; that, I thought, was most deplorable. The Prime Minister likes to broadcast. He has endeavoured to secure a monopoly of it for himself, and he endeavours to exclude from the use of that great organ any opponents and any critics. I am surprised that the right hon. Gentleman did not make a better use of it. When I heard those statements about the duck pond—no, it was the paddle-pool—and the rope mats, and the renovation of the archaic Roman bridge, I thought of those men sitting in their cottages, in this distress that falls upon them, and I am bound to say that I think that that speech must have been a shock, a very great and an insulting shock to them, coming as it did from a Prime Minister who, in the first in- stance, led the Socialist party into office on the claim that he could cure—virtually cure—unemployment.

Then the Bethnal Green letter—the "death-knell Green letter" it might be called—which has been expanded and expatiated upon by the Chancellor of the Exchequer this afternoon, is virtually a statement that there is no immediate plan or policy which the Government are pursuing, other than allowing the great drift of world events to take their course. I do not think that it is right to condemn men because they cannot encounter the tide of world events, but you are entitled to condemn them if the spirit which they produce does not show that they are endeavoring as far as they can to do so. Immense powers reside in this Government. You compare its action with previous Governments; that is not fair. No previous Government, except in the War, has had the power which this Government has, an absolute power. In both Houses of Parliament, overwhelming majorities; a mighty Press to support them; broadcasting. You have every power at your disposal, and all that is to come, is what we have heard today. I am sure that when the right hon. Gentleman's speech is read it will be felt all over the country that it is very poor, thin fare for this nation, and that a far greater constructive effort, more grip, more mental energy, more resourcefulness ought to be represented by those who have those great powers, and who are in charge of our destinies. If this that we have heard today is the last word that the Government have to speak upon this problem, then indeed the outlook before us is grave and lamentable.

5.56 p.m.


The Chancellor of the Exchequer has attempted to give the impression that the Leader of the Opposition held that the Government are responsible for the unemployment problem. That was afterwards supported by the statement that the increase in unemployment was not due to the action of the Government. We have never held that the Government are responsible for the problem of unemployment, and I challenge the accuracy of the statement; but we also challenge the accuracy of the statement that the increase of the problem is not due to the action of the Government. In any case, whether the Government are responsible for the increase or not, we maintain that they should so administer the Unemployment Insurance Fund as not to permit the unemployed to starve in this country.

Reference has been made by the right hon. Gentleman the Member for Bow and Bromley (Mr. Danbury), who moved the Motion, to the very sad case which was reported in the newspapers, in which a mother starved herself in order that her children might have sufficient to keep themselves alive. We were told in the newspapers that there were nine in that family living on £2 8s. a week, and that, even in that instance, 3s. per week was coming into the home as a result of the employment of one of the members of the family. There are hundreds of thousands of cases similar to that one, and, in fact, worse, because one child was earning 3s. a week. I wish to direct the attention of the House to the statement that was made by the coroner, an educated individual, and a man in an important office. He stated that it seemed to him that there was something wrong that those people should be starving. He said: I should call it starving to have to feed nine people on £2 8s. per week and pay the rent. If there were any justification for the Motion, it would be the fact that here is an educated man who gives the impression that he was not aware that nine people were expected to live on a miserable £2 8s. per week, an amount for which this Government is largely responsible. In the Motion we ask that the Government should initiate a plan that will increase the total production of wealth in this country. I do not entertain the slightest hope that the Government will pay any regard to that item in the Motion, because they are already convinced, as has been pointed out previously from these benches, that it is preferable, and, in fact, more economical, to pay unemployment insurance benefit, rather than to provide employment for the unemployed. On 4th November last year we had a three days' Debate on this question of unemployment. The Government always ignore the fact that when men are idle there is, with 3,000,000 unemployed, an annual loss of £600,000,000 worth of wealth to this country. There is not only the payment of benefit to unemployed men—which, we contend, is wrong and economically unsound—but the possibility that there would otherwise be of producing wealth is being lost to the extent of £600,000,000 a year. As was pointed out in the Debate to which I have referred, we have never had less than 1,500,000 unemployed since 1921, and, following the same basis of calculation, we have lost in wealth, in nine years, over £2,700,000,000. That item is always conveniently ignored by the Government, who contend that it is cheaper to provide our unemployed people with unemployment benefit than it is to provide them with employment.

Reference is made in the Motion to the reduction that has taken place in the purchasing power of the masses under the present Administration, and I desire to emphasise the extent of this decrease. The rates of wages were reduced in 1932—and, by the way, I am not blaming the Government for that reduction; all that I am doing is emphasising the terms of the Motion, which points out that there has been a considerable decrease in the purchasing power of our people. Wages were reduced at the rate of over £248,000 a week, or, in a year, some £12,412,000. During 1931 and 1932 there has been a reduction in the wages of our people of over £32,400,000. What is still worse is that, while wages have been reduced, the working hours have been actually considerably increased. In 1932, the hours per week were increased by 7,500, equivalent to 375,000 for the year; and the total increase in the number of hours worked by our people in 1931 and 1932 was over 7,000,000, as compared with an actual decrease, in the year 1930, of 43,675,000. I assume that it is a mere coincidence that we should be taking part in a discussion on unemployment on the 16th February of this year, and that a Motion on the same subject was discussed in this House on almost the same day last year, namely, the 17th February. The Minister of Labour, in the course of that discussion, said: The Motion stands in the names of six hon. Gentlemen, four of whom are connected with the coal industry, and are, indeed, among the most trusted and experienced leaders of the miners. They are, I know, as disturbed as I am at the disclosure of figures which show that there is an increase of unemployment in that industry. They are anxious, as I am anxious, that this House as a House of Commons and the Government as a Government should do all that they can to help the coal industry."—[OFFICIAL REPORT 17th February, 1932; col. 1715, Vol. 261.] I would ask, what have the Government done since that statement was made in 1932? What are the facts with regard to the mining industry at the present moment? Last year, the output of coal in Great Britain was only 209,250,000 tons, showing a decrease, as compared with 1931, of over 10,250,000 tons. The output in 1932, as compared with 1930, showed a decrease of 34,750,000 tons. The 1932 output, compared with that of 1929, showed a decrease of 48,750,000 tons. It is to the credit of someone—certainly not to the discredit of those who occupy these benches—that this, with the exception of 1921 and 1926, during two national stoppages, is the lowest output of coal in this country for the last 34 years. The exports, obviously, reflect the decrease in the amount of coal produced in this country, and we find that last year, as compared with the year 1931, the exports of coal from this country were reduced by over 3,850,000 tons; while the exports for last year, as compared with 1930, show a decrease of approximately 16,000,000 tons.

As to unemployment among miners, we are told that on 19th, December, 1932, there were no fewer than 305,385 unemployed miners. The figure for 1931 was 257,223, so that the number of unemployed miners last year, as compared with 1931, was increased by 48,162. During the same discussion, the Minister of Labour said that part of that increase—there was an increase at that time—was due to the exceptionally mild winter. I submit that the right hon. Gentleman should immediately send his compliments to the Labour Correspondent of the "Times" newspaper, who, in commenting on the figures supplied by the right hon. Gentleman's Department as to the number of persons unemployed in this country, which appeared in the "Times" of 7th February, made this statement: The severe weather—for the day on which the count was taken was the coldest for four years—may explain part of an increase of between 13,000 and 14,000 in the number of building industry workers unemployed in London and the south-east, where, also, between 9,000 and 10,000 additional distributive trades workpeople were without employment. The Minister last year contended that the increase in the number of unemployed was due to mild weather; while the gentleman in the "Times," who was only stating a fact, said that the increase last year was due to the weather being of a rather severe kind. It is about time that the Government ceased giving us such childish, trivial, puerile explanations of the continual increase in the number of unemployed. Such explanations, in my opinion, are only surpassed by a statement ascribed to no less an authority than Sir Charles Marston, that be believed that the real cause of the distress and unemployment in this country was due to the fact that 75 per cent. of the people never entered a place of worship.

I have been consulting what is known as the Local Employment Index, which gives the percentage of unemployed among the insured population. I may, perhaps, be pardoned for referring for a moment to my own constituency, which is one of the distressed areas of South Wales, and is typical of many areas in South Wales. My Division is served by three Employment Exchanges, which are responsible for the registration of the unemployed, and also pay out benefit every week. We have one at Crumlin, one at Abertillery, and one at Blains. I find that the percentage of unemployed among the insured population in 1931, at Crumlin, was 20.1. In 1932 it had increased to 43.2. In Abertillery, in 1931, the percentage was 29.2, and last year that figure had increased to 66 per cent. Blains, the conditions of which are well known in other parts of Great Britain, had a percentage, in 1931, of 45.9, and last year the percentage was 78.4. That is as compared with percentages, for the whole of Wales, of 30.9 in 1931, and 38.0 in 1932. The tragedy is not to be found solely in these figures. The tragedy, in my opinion, is to be found in the conditions in Blain, where in 1931, among the juveniles, there was an increase of 113 per cent., and in 1932 an increase of over 156 per cent.—to be exact, 156.7

. We, as representatives of mining areas, claim that the continual depression in our divisions is due mainly, if not solely, to the tariff policy of the Government. Last evening my hon. Friend the Member for Spennymoor (Mr. Batey) made a similar charge against the Government. There was the usual Tory titter on the benches behind him, and it was joined by a Member who represents a mining area, and who should have known better, because, to my knowledge, he had been supplied with the information with which I am about to deal. We contend, as miners representatives, rightly or wrongly—and to put us right is the responsibility of Members of the Government—that tariffs have had the effect of reducing the amount of coal exported to Germany. This was the point made by my hon. Friend the Member for Spennymoor, and I shall be pleased to be corrected if the observations I am about to make are not well founded. We have never held the view that the reduction in the amount of coal exported from this country to Germany is due to the German quota system, but we say that the reduction in the amount of coal under that system has been largely due to the tariff policy of this Government, and has been responsible for rendering permanently unemployed an additional 12,000 to 15,000 miners in South Wales.

What are the facts? They can be found in the speech of the Parliamentary Secretary to the Board of Trade on 23rd March, 1932. He stated that in September, 1931, Germany took from this country under her quota system, which I agree was in existence before the tariff policy was tried, 420,000 tons of coal per month. On 1st October of the same year she reduced her quota of British coal to 300,000 a month. On 1st February she further reduced it to 200,000 tons a month, and on 1st March to 150,000 tons a month. On 1st April, not an inappropriate date having regard to the existence of the present Government, Germany further reduced her quota to 100,000 tons, and that is all the coal that she is taking from Great Britain. The first Bill that embodied the tariff policy of the Government was introduced on 18th November, 1931. The second Bill, known as the Import Duties Bill, was introduced on 4th February. So that the reduction from 300,000 tons per month to 100,000 tons was due, in our opinion, to the tariff measures of the Government. If it is right to assume that Germany anticipated tariffs with the advent of a Tory Administration, the further reduction from 420,000 tons per month in September to 300,000 tons in October was due entirely to the tariff policy of this Government. Even if Germany did not anticipate tariffs being introduced by this Government, the reduction of 120,000 tons per month before the first tariff Measure is less than the subsequent reduction of 200,000 tons per month.

The Minister of Labour, in a speech that he delivered on 19th March, said he believed that he was justified in entertaining feelings of unrestrained optimism as to the future. I should like to know his feelings now after the Government's tariff policy has been tried, and after the conclusion of so many international conferences. The right hon. Gentleman is not quite as optimistic today as he was 12 months ago, but the Prime Minister, with unrestrained modesty, is saying precisely the same things now. Last week he said: There are definite signs of increased activity. There are now signs of national recovery. He may be a reliable politician, but he certainly is not a person upon whom any reliance can be placed with reference to what may happen in the future. I prefer the statement of Sir Arthur Salter who said: The signs of a real revival in trade are scarcely yet visible. That is borne out by the increase in the number of unemployed from 25th January, 1932, to 23rd January. 1933, which amounts to 468,978. We are generally told that there are more in employment. the right hon. Gentleman has made that statement on more occasions than one, but he will derive no satisfaction from that source in replying to this Debate, because on 23rd January last the number in employment was a little over 9,285,000, which is 172,000 less than in December of last year and 76,000 less than in the year before. We are also told that a particular month's figures are not reliable. Let us take the year's figures. In 1932, compared with 1931, there was a decrease in the number of persons in employment of 69,000, and that is the lowest figure since 1923—another record under a tariff administration. Comparing 1932 with 1930, there is a decrease of those in employment of over 445,000 and, compared with 1929, a decrease of 868,000. The Chancellor of the Exchequer, who can always be relied upon to deliver a sour speech when a Motion is under discussion the terms of which do not agree with himself, said in November last: We have to recognise that, while we may hope to get an. increasing number of them employed in their own trades, it is a large number who are not going to find that employment, and we must make some provisions to make their lives happier and more tolerable and to preserve in them their self-respect and their fitness to take work if work should be available."—[OFFICIAL REPORT, 8th November, 1932; col. 261, Vol. 270.] The Government cannot claim that they have endeavoured to do that. They have taken from the unemployed, by the means test alone, over £10,000,000 a year and, by reducing benefits, have also taken £12,800,000 a year and from those who are in employment, in the form of increased contributions they have extracted no less than £5,000,000 a year—a very peculiar method of maintaining the self-respect of an unemployed man and making it possible, when an opportunity of employment should offer, for that man to enter an insured industry. It is a wonderful method, a typically Tory method, of making people's lives happier and preserving their self-respect.

The Prime Minister has also told the unemployed what he has done and what he is prepared to do for them. In the letter to which reference has been made this statement is to be found: With a view to doing everything possible to assist those who must in the meantime suffer from unemployment, the Government has, therefore, as you know, with the co-operation of the National Council of Social Service, enlisted the help of voluntary bodies throughout the country for the provision of occupation and recreation of unemployed persons and for caring for their welfare generally. Much excellent work in this way is already being done. That is the only gracious act of the Government to which we are under an obligation to refer. They made a grant to the National Council of Social Service, in order to maintain the self-respect of the unemployed, of £10,000, which is equal to a penny per unemployed person in the country. It is true that they have increased it to £15,000, which is equal to l½. per unemployed person, after reducing their benefits to the extent of 1s. 8d. per week, or £4 l1s. a year. Since the present Government have been in office they have three records unknown in the political history of the country to their credit. At the end of March, 1932, the number of persons relieved was 15,795–4,000 more than the year before and the highest figure for 28 years, the lowest output of coal has taken place under a Tory administration for the last 34 years and they have to their credit the largest number of unemployed. I may not be expected to compliment the Government, but I want to compliment them on the thoroughness of their tariff policy and the rig our with which they have carried it out. We are told in the "Evening Standard" today that the British Customs authorities are insisting on the payment of import duty on cups and medals won abroad in competitions and sent to the British holders. I notice that the Prime Minister has given up for the moment consideration of the crisis, and has taken to cricket. That has taken the form of a telegram of congratulation to Jar dine. May I be permitted to ask the Prime Minister whether the Government propose to impose a tax upon the "Ashes" which have been recovered by the captain of the British team? After tariffs, Ottawa and the International Conference, what next? Governmental complacence in present conditions in the country is, in my opinion, a crime, grants to charitable organisations are studied insults to the unemployed, literary vapourings from a discredited Prime Minister are indecent and unrestrained optimism on the part of the Minister of Labor is an exaggerated excuse for political ineptitude and laziness. In the words of Sir Arthur Salter: Natural forces alone are insufficient. Leadership and bold policy remain essential.

6.28 p.m.


We on these benches have little objection to the actual wording of the Motion before the House. The first part of it states the facts of the situation, and the second part appeals for a policy such as we should desire to see pursued. But the Motion is very incomplete. It leaves out what is really the main feature of the situation. It is true that the economic crisis through which the country is passing is part of a world crisis and that our distresses here are due to international causes, and could be relieved only in the main by international remedies. The Motion makes no specific reference to that which is, after all, the essential fact of the whole situation. Therefore, if it were placed upon the records of the House, it would be far indeed from dealing adequately with the situation in which we find ourselves. If the whole policy suggested in the latter part of the Motion were carried into effect, still there would be a grave measure of unemployment as long as the international trade situation was not redressed. The policy of the Liberal party has never been so limited. Although we have emphasised again and again the necessity for planning, for a large policy of construction, development and national equipment, we have always said this is only a minor part of the great policy of remedy which must be primarily international, aimed at removing the restrictions which have brought the trade of the world to collapse.

Secondly, this Motion is, of course, specifically a Vote of Censure. A day has been given to this discussion for that reason, and although the actual wording may be unobjectionable from our point of view, we have to consider whether we should be justified in voting for a Motion which has this precise character. The right hon. Gentleman the Leader of the Opposition referred to the situation in the last Parliament and the many Motions of Censure which were made by the then Conservative Opposition on the Government of that day on the ground of unemployment, and the situation today resembles very greatly what it was on one such occasion in April of 1931, when my right hon. Friend the Lord President of the Council, then Leader of the Opposition, moved That His Majesty's Government, having failed to carry out their election pledges with regard to unemployment, and having ceased even to attempt any remedial measures, do not deserve the confidence of this House."—[OFFICIAL REPORT, 16th April, 1931; col. 363, Vol. 251.] On that occasion my right hon. Friend the Member for Carnarvon Boroughs (Mr. Lloyd George), who was then the Leader of our party, advised us not to vote for that Vote of Censure—although he said that in substance it represented the facts—because he thought that it was inadvisable to pursue a political course merely on the strength of the wording of a Motion. But although my right hon. Friend the Lord President of the Council, then Leader of the Opposition, did not introduce Protection into his Motion, it was what it meant. So my right hon. Friend opposite, although he has carefully omitted from this Motion Socialism in terms, it crept into his speech, and we have to realise that that is the real purpose underlying the Motion which is before the House.


Hear, hear!


And the cheer of assent which he now gives to my observation confirms my view. [An HON. MEMBER: "A good excuse for it."] Yes. In these circumstances we have placed upon the Order Paper an Amendment to the Motion of the right hon. Gentleman which expresses the policy which we would desire to see adopted, if the House were to support it, but, unhappily, owing to the present practice of the House, that Amendment cannot be moved. The Deputy-Speaker has intimated to me, with the authority of Mr. Speaker, that he would not feel justified, in accordance with the usual practice for Debates on Votes of Censure, in calling upon any Amendment. That is very different from the practice of the House in previous days, when any Member had the right to have any Motion or Amendment, which was itself in order, moved and put to the House. That practice, which continued for centuries, gave rise to great abuses. It had to be modified and indeed abolished, and as a result we find that, although today the point of view, both of the Vote of Censure and of a mere negative may be unacceptable to various Members of the House, they are not able. according to our constitutional procedure, to submit their views effectively to this Chamber and to secure a vote on that issue. For our own part, we do not approve either of the Motion or of a simple negative of the Motion. We cannot approve a simple negative because it is true, in our view, that the Government have failed adequately to deal with the question of unemployment, and it is true that a plan is needed for public work and national development as one among various remedies that might be applied.

The Chancellor of the Exchequer, in a speech which, I think, is regarded in many quarters of the House as a very disappointing speech—far too negative and critical, and far too little constructive—took satisfaction in what he regarded as an improvement in the financial situation. There is an improvement. It is obviously true that the financial credit of the country has been restored, that money is cheap, that the Bank Kate is low, and that there are other favourable signs in the financial world, but that is due, not only—and I am sure that the Chancellor of the Exchequer would agree—to the fact that the Government of Great Britain enjoys good credit both here and in the world, but also to the appalling state of national trade. There is no opening for money. Every business man knows that that is the main reason why money is left on deposit at the banks at a nominal rate of interest, and can be obtained for long-term loans at a much lower rate of interest than before. It is a good sign in that it represents the high standard of national credit, but an appallingly bad sign in that it represents the almost complete stagnation of national trade and national industrial development.

The right hon. Gentleman said that he could speak with qualified optimism. There is certainly ground for the qualification. I am not sure about the optimism, A few months ago his colleague the Minister of Labor had to come to this House for a Supplementary Estimate for the unemployed of no less a sum than £18,000,000—a colossal sum. In earlier days it would have been regarded as a catastrophe, as disastrous, if, in the course of a year, the Chancellor of the Exchequer should have to come for a Supplementary Estimate for £18,000,000 for any purpose. To be spent merely upon maintaining fresh hundreds of thousands of people in idleness it is a catastrophe. The Minister of Labor said that the reason why he had to come to the House for this sum was that the Estimates of his Department had been framed upon an unduly optimistic basis. I hope that the optimism of the right hon. Gentleman now, even though qualified, is not like the optimism upon which that Estimate was based. At one stroke that £18,000,000 has absorbed for this year two-thirds of the whole of the savings made to the Exchequer by the Conversion Loan, and the charge for unemployment upon the Revenue is £80,000,000 this year. It is that which causes the high taxation. It is equal to an Income Tax of 1s. 6d. in the pound. It is that which is causing the difficulty and the stringency of the Budget.

The right hon. Gentleman said that it was the object of the Government to raise world prices. That was the first step, the essential step, towards international, and, therefore, national, recovery. When he and his colleagues went to Ottawa last July they declared, as one of the prime purposes of the British Government, the raising of the level of international prices. That was last July. What has happened since? They have not been raised. They have not been even kept up to what was regarded as the excessively low level which they had then reached. In six months they have fallen a further 14 per cent. If you look at the figures in the "Economist" you will see that since Ottawa, since the Government declared that their policy was to raise the international prices of the world, and that that was the only way to secure a general recovery of prosperity, so far from that having occurred, prices have fallen 14 per cent. And they were still falling last month. As long as the economic forces of today are at work, so long will there be little chance of any recovery.

The right hon. Gentleman says that he sees signs of trade recovery. There are some slight signs here and there from the appallingly low level which has now been reached, but the experts appointed by the League of Nations from all the chief industrial countries, together with representatives of the Bank of International Settlement, and others, recently reported unanimously, first, as a fact that the trade of the whole world, in a period of three years, had fallen by two-thirds. The value of goods exchanged between the nations now is only one-third of what it was three years ago. Secondly, that although there were some slight signs of improvement here and there, the nations ought not to depend upon it, that there were still unfavourable signs, and that the situation must be regarded as one of great gravity and urgency. It is no consolation to this House to be told that this last year other countries declined in their prosperity even more than we had. We were at an exceedingly low ebb and now these countries are joining us there. It is no consolation.

The hard facts are shown in the figures of the unemployed. Owing to the administrative measures taken last year, as the "Labour Gazette" told us month after month, about 170,000 of those who were on the register were removed from it. To make the figures comparable now with the previous figures of a year or two ago that 170,000 should be added for statistical purposes. That would bring the present figure far above the 3,000,000, and be by far the worst ever known in the history of the country. Let the right hon. Gentleman beware of continually trying to persuade the country that prosperity is just round the corner. When he introduced his tariff Measure in February of last year he said that now we had cleared the road for prosperity. There was a Chancellor of the Exchequer about a century ago, Mr. Robinson, who was afterwards Lord God rich and later Lord Ripon, who, when the nation was sunk at that time in the depths of depression after the Napoleonic wars, was continually telling the House of Commons that prosperity was just coming, that it-was all right, and that they need not trouble. He had the nickname of "Prosperity Robinson." Let the right hon. Gentleman beware that he does not earn a similar nickname. Let him remember also the fate of President Hoover, who was continually telling the American people that they had only to be patient a little longer, that remedial measures would be taken, that prosperity was returning, and that what was necessary was to continue the present policy. He was swept away largely through the anger and resentment which had been aroused by continual prophecies of that kind which had not been fulfilled. The right hon. Gentleman has asked for confidence. He said that although confidence had been restored, it was a fact that the money in the banks was not being used. Confidence depends upon business men feeling that they are going to get profitable orders for their goods. Confidence depends upon that. The orders do not depend upon the confidence. And the orders for the goods depend upon the market, and upon the prosperity of our customers.

The right hon. Gentleman now at last tells the House of Commons that the real cause why there is not a movement of trade and why the restoration of confidence has not been followed by greater activity in industry and more employment is the hindrances to international trade. At last, today, the Chancellor of the Exchequer tells the House of Commons frankly that what is the trouble with our trade is the hindrances to the movement of international trade, when all his life as a Protectionist he has been endeavouring to increase those hindrances. He declares that now we must base our hopes upon the World Conference to lessen those hindrances. I entirely agree with him. That is what we have been declaring and preaching from the housetops for a long time past, but he has given no indication as to the policy which the Government are going to pursue at that Conference.

Is it to be really a policy of lessening restrictions, abolishing tariffs and abolishing quotas? The President of the Board of Trade, a few days ago, said that the system of import quotas was insane. That was his word. He said that it was the curse of European trade. But the President of the Board of Agriculture, in a speech a day or so later, said that the system of import quotas had come to stay, and that it was part of the post-war economic system of the world. Even today the Chancellor of the Exchequer—in a speech in which he said that the hindrances to international trade were the main source of all our troubles—said that the ought to have more quotas and that the principle that was being applied to meat quotas should be applied to a whole variety of other articles. What is to be the policy of the Government in this matter? Is it to be one of further restriction or is it to be one of further liberation?

In regard to tariffs, we have urged in the House and out of it that what appears to be the only hope in the present state of the world of securing a large reduction of tariffs is for those countries which believe that that is necessary—and there are many of them—to group themselves together and to apply the principle as between themselves. If we wait until the countries that are wedded to Protection all agree to reduce their tariffs to a low level, we shall, in all probability, secure nothing. Therefore, the right objective at which the Government should aim is the creation of a low tariff group. That must involve a modification of the most favored-nation Clause in international treaties. The Association of Chambers of Commerce realise that, and have brought the matter specifically to the attention of the Government. They have urged that it should have consideration and that a reply should be given on that point, but the Government refuse to declare any policy with regard to that essential matter.

When two countries, small countries but commercially important, Belgium and Holland, took the lead last year and said that they would form such a group as between themselves, and invited all or any countries to join them, the British Government, instead of welcoming that step and saying: "It is on right lines, we will give you every encouragement; this is a heaven-sent opportunity to push forward what is obviously the right thing," took a directly opposite course. They appealed to the most-favoured-nation Clause in the commercial treaties, blocked the initiative of Belgium and Holland and said that they could not consent to it under existing international law. In to-day's Press it is stated that three of the important countries of central and south eastern Europe—Czechoslovakia, Yugoslavia and Rumania—have strengthened the ties that bind them and are, apparently, proceeding along the same lines in regard to tariffs as between themselves. There is a move of that kind in the world, and it is of supreme importance what course the British Government take in regard to it. If they support it, it may succeed, but if they oppose it, it will most certainly fail. That is the solution which we bring before the House of Commons to-day and, although under our existing practice and procedure we cannot move it, our Amendment does embody that as one of its prime purposes and urges upon the Government and the House that this particular point should be taken up as essential to the whole economic situation and as vital to the solution of the problem of unemployment.

The second point is in regard to capital investments. The Chancellor of the Exchequer, the Prime Minister and others continually say that they are against re- lief works, and, having said that, they seem to think that they have disposed of the matter. We are all against relief works. The Leader of the Opposition today in his speech declared himself against relief works.


Hear, hear.


We have repeatedly declared ourselves against relief works. By relief works we mean work which is of no particular value in itself, and is undertaken merely for the purpose of employing labour. That is a wrong policy, which has been tried in many countries and has failed again and again, and is wholly unsuited to a prolonged period of unemployment such as this. But the policy of national development, of capital investment—call it what you like—which we have advocated in the past and which has been advocated today, is on a wholly different footing. The Chancellor of the Exchequer says that £700,000,000 was spent in seven years, and he asks how much has been done to cure unemployment. Yes, but for that £700,000,000 you have £450,000,000 worth of houses; they are there. You have so many millions spent on roads, useful to the nation, which ought to be built. You have so many millions of pounds represented in harbors, water supplies, drainage systems. All these things are valuable to the nation. You cannot regard that expenditure as mere waste. The only expenditure during that time which has been mere waste, economically, is the expenditure on the dole to the unemployed. [An HON. MEMBER: "That is not waste."] Economically speaking it is. Speaking purely from the point of view of finance. I was careful to say "economically speaking." From the human point of view it is essential and vital, but it brings no monetary reward.


It enables them to buy goods, and that makes work for someone else.


Yes, but economically, after a period of years, there is nothing to show for it. It is not reproductive.


Except for human beings.


Except for human beings, who have to be kept alive. But the £700,000,000 that has been spent on assets represents assets which are of value, and it is not right for the right hon. Gentleman to refer to that expenditure as mere expenditure with no results. In the financial crisis of the summer of 1931, when, as he points out, conditions were very serious and we were on the edge of disaster—so to speak, we were in a motor car which was running away down hill—the Chancellor of the Exchequer, then Mr. Snowden, had to put on all his brakes. There had to be a stop put upon all kinds of expenditure until financial confidence had been restored and the credit of the nation had been made stable. That was necessary then, and that has been accomplished. There is still, it is true, ground for economy. There is no room for waste. We cannot impose further net burdens upon the rates and taxes, but so far as the borrowing of money for development and industrial progress is concerned, we are no longer on the slope of the hill; we are on the level. But my right hon. Friend still keeps his brakes on. He keeps them on too long.

Lord Snowden, who was responsible for the policy of severe restriction 18 months ago, now tells the nation that in his view that restriction ought to be no longer continued, that a more positive policy should be pursued. Every political economist says the same. The Chancellor of the Exchequer spoke today as if his policy of restriction, his negative policy in regard to development, was obviously right and must be approved by every economist. There is no great economist in England now who does not condemn it. Men like Sir Walter Layton and Sir Arthur Salter are very strongly of that view. Take Sir Arthur Salter, whose name is always received with proper respect in this House. He gave an address two or three days ago in which he pointed out the enormous increase in the deposits in the banks last year—nearly £250,000,000—and the enormous fall in the advances by the banks for industrial purposes—£120,000,000—and he went on to say: Here, then, are the monetary resources. It is the demand that lags. How can we stimulate this? There is one way, cautiously suggested by Mr. Rupert Beckett, the chairman of the Westminster Bank, and one of the most prudent of our financiers: It is the only method by which we can act quickly and decisively. It represents, in my view, the most crucial issue in British economic policy at the moment. This method is a profound modification of our policy of restricting public expenditure. We have, in my view, gone much too far in discouraging useful capital expenditure by local authorities. The only answer of the Chancellor of the Exchequer today to a declaration such as that is that we must not splash money about. Of course, we must not splash money about. But that is not to say that there is not a whole variety of most useful things which the local authorities need, many of them bringing in actual revenue, some of them necessary for the development of the services of the towns. For example, there is the building of the schools that are necessary. There has been almost a complete embargo upon the building of schools. Those schools must be built some day. Similarly there are other works of various kinds, some of which are mentioned in the Amendment which we have placed upon the Order Paper. It is not only a question of public enterprise, whether national or local, but also of private enterprise, and it should be encouraged rather than discouraged.

The right hon. Gentleman had to impose restrictions on the use of money for the sake mainly of the success of his conversion operations, but those restrictions, in our view, have been continued far too long. Instead of restricting the free use of money in any direction in which the investors in the City think it can properly be used, every encouragement should be given to its release, because every loan that is issued means capital development and, in the long run, means work—work for the building trade, work for the iron and steel trade, and so on. It is the trades that are mainly dependent upon capital expenditure which at the moment are most depressed. The right hon. Gentleman says that he is willing to consider any of these schemes on their merits. We are not proposing any schemes which on their merits ought to be ruled out. They are schemes which, in our view, should on their merits be accepted and one of the merits of those schemes is the fact that every man who is thus employed is a man taken off the dole. That has to be counted among the merits of proceeding with these schemes at the present time. That there are difficulties in finding suitable work in carrying out these measures is no doubt true. It is a tremendous and formidable problem. Canst thou draw out Leviathan with a hook? It needs energy, it needs zeal, but the right hon. Gentleman today has shown signs not only of qualified optimism but of very qualified activity and of still more qualified enthusiasm.

I have a definite suggestion to make, to which I would venture respectfully to invite the attention of the House. It is on different lines from the suggestions made hitherto, not as to the nature of the work to be undertaken but as to the means of getting it done, and getting it done quickly. We have been caught up in the complexity of our State and municipal machinery. We have Cabinet Committees, Government Departments, Departmental Committees, local authorities, committees of town councils, committees of county councils—an enormously complicated and slow-moving machine. Ministers cannot give their close, continuous and active attention to questions such as those which are under consideration at this moment. The Cabinet has an enormous range of home and foreign affairs to deal with—the American Debt, the Far East, Disarmament, everything, large and small, down to greyhound racing.

The Minister of Agriculture is overburdened with schemes for the pig industry, the milk industry and one hundred and one different subjects. I suggest, therefore, a different procedure for handling this, if we are to handle it with a sense of crisis. As it happens, the right hon. Gentleman the Chancellor of the Exchequer mentioned Signor Mussolini. For my part, I dissent entirely from the fundamental philosophy which underlies Fascism, but at all events Signor Mussolini gets things done. That is because he depends upon men, and not so much upon machinery. Is it not possible for us in this country to combine our democratic and Parliamentary institutions with a more effective system of governmental action which would bring results?

I suggest for consideration—if the Cabinet can only be induced to do it, although from the speech of the right hon. Gentleman the Chancellor of the Exchequer I doubt if they can be in- duced, to adopt a more forward policy, whether in housing or anything else—that it could be carried through effectively if the Minister concerned were to appoint an individual, in whom he had confidence, as a special commissioner. That person would have individual responsibility for preparing a scheme. He would confer with the Minister concerned, the local authorities, if necessary, and the Chancellor of the Exchequer, with a view to considering matters of finance and avoiding the danger of waste. He would make himself personally responsible for the preparation of schemes, and get over the inertia which hinders us in all these matters. There might be one commissioner to deal with housing. He would prepare a plan as, under the last Government, Sir Tudor Walters was preparing a scheme for rural housing, which could have been carried through if the Government could have given him sufficient backing. Some persons of strong personality, experience, judgment and reliability might be appointed—one to deal with housing, one to deal with land settlement, and a third to deal with Imperial migration. Migrants are pouring into this country from the Dominions, though it ought to be the reverse process. Other subjects which could be dealt with are railway electrification and temporary occupations for the unemployed.


In what way would such men differ from the chairman of the Coal Mines Commission, who is head of a commission which has been working on similar lines for the last three years?


There is not quite the same urgency in that matter. The idea is really the same. If the reorganisation of the coal mines had been left merely to the Ministry of Mines there is not in that Department, or any Department, the energy and initiative which are essential in matters of this sort. Just as it was found necessary to appoint the commission to secure the reorganisation of the coal industry, which is now taking effect in the coalfields of Fife, Cannock Chase and elsewhere, so you may have to appoint a responsible person, or a number of persons, or you will not be able, as is colloquially said, "to get a move on." The Government would remain the authority to take action in the last resort and no legislation would be involved. During the War special methods had to be adopted to secure effective administration, and so I suggest that, having been caught up in the entanglements of bureaucracy, we ought to find a new and shorter way.

I think that each Member of the House of Commons feels to the full the responsibility that rests upon us in this matter. We will not be content as a House of Commons to be engaged during the whole of this Session on measures not dealing with, unemployment, but which are merely a reform of unemployment insurance, or measures to find temporary occupation for those out of work. That is not enough; that is not dealing with unemployment, but only with the consequences of unemployment. It is not dealing with the disease, but with the symptoms. It is not trying to eliminate the microbe, but only alleviating the pains. Therefore, we place before the House today these two distinct proposals raising great questions of principle. They are questions which could be answered by a plain "yes" or "no." As to international action, it is the essence of the whole matter. Are the Government ready to agree with other countries to remove restrictions on commerce, even if the most-favourednation Clause in our commercial treaties has to be largely modified? Secondly, are they prepared on a large scale to encourage the use of idle capital and labour by public and private enterprise, in undertakings that are useful and remunerative to the nation?

I think that this House has a deep sense of dissatisfaction at the present situation. This House is not interested in party issues. It was not elected on a party basis, and it is not a question which greatly interests any of us whether the Liberal Members go into Opposition or do not. What may soon happen may be that the whole nation will go into opposition. There is a profound feeling of discouragement following upon the Prime Minister's letter to Bethnal Green, and on the three days' unemployment Debate in this House, to which all sections brought contributions in a friendly and helpful spirit with no result. Nothing occurred as a consequence of that Debate nor in the discussion yesterday on unemployment. The speech of the Chancellor of the Exchequer to-day was negative and unhelpful. Surely it is the duty of this House in the present state of the nation to insist upon a change of policy.

7.8 p.m.


I do not propose to follow the right hon. Gentleman into any of the complicated proposals which he endeavours to explain from time to time to the House of Commons. He and his friends came to this House because they succeeded in persuading the electorate that they would support the National Government. They now give most of their time to criticising and harassing the Government. It is an unprofitable thing, and one which is hardly worthy of the time of this House. We, as a nation, find ourselves faced with a very severe test of endurance in these days. Our finances are under the direction of the right hon. Gentleman the Member for Edgbaston (Mr. Chamberlain) and I hope very much that he will not allow any amount of barracking by the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George), or the right hon. Member for Epping (Mr. Churchill), to cause him to change the policy he has deliberately laid down, and that he will persist in carrying it to its conclusion.

We have had from the right hon. Gentleman the Chancellor of the Exchequer a very sober statement of the situation. Because he would not make extravagant claims, we have been told that he is hopeless. I think that anyone listening to that speech today could fairly urge that it was in no sense a hopeless speech. On the contrary, I think that if we carry our minds back to the position in August, 1931, we shall be bound to admit, not that it is remark-able how little has been done since then, but that it is remarkable how much has been accomplished. The anti-National party, led by the right hon. Gentleman the Member for Bow and Bromley (Mr. Lansbury), are very fond of taking the opportunity afforded by a Debate such as this to express their sympathy for the unemployed. Of course it is an easy thing to express sympathy, but when opportunities for more practical help are suggested the right hon. Gentleman and his friends grow very restless. For example, this afternoon the right hon. Gentleman, referring to the appeal for practical help, which has been made by the Government to the people of this country through the means of the National Council of Social Service, described it as a "disgusting disgrace" to the British Government. I venture to say that the unemployed will take a very different view, and will vastly prefer the practical expression of sympathy to which that appeal will give rise to the many useless expressions of vague sympathy they get from the Front Opposition Bench in this House.

The right hon. Gentleman and hon. Gentlemen who direct the policy of the Labor party in this House show a certain lack of imagination in repeatedly moving Votes of Censure on the subject of unemployment. It is obvious that, on every occasion, a sharp contrast must be drawn between the results of the policy pursued by the late Labor Government and the policy pursued by the present Government. The policy of the late Labor Government was a complete and utter failure, and must be contrasted with the, at least, comparative success of the policy of the National Government. It may be that the Labor party feel that the country is so utterly dissatisfied with the efforts they made, when they had the opportunity, that any criticism which may arise in these Debates can do them no harm. But, at any rate, whatever wisdom or unwisdom from their point of view there may be in raising this subject from time to time, it does afford opportunities to Members of the House to discuss different aspects of this problem in a way which would not otherwise be possible.

I would like, therefore, for a moment to refer to one aspect about which a good deal has been heard this afternoon—the question of State—assisted relief works. Reference has been made more than once to the letter written on behalf of the Prime Minister to the Bethnal Green Borough Council, and sharp criticism has been heard on the terms of that letter. Certain facts are given in that letter which its critics do not attempt to deny. They are worth repeating. The policy of State-aided relief works is to be entered upon for the one object of providing employment. The Prime Minister pointed out that in the hope that the depression was temporary the Labour Government between June, 1929, and August, 1931, initiated relief works of an approximate amount of £192,000,000. As a result of that gigantic expenditure of money the greatest number of persons directly employed at any one time was 114,000, in June, 1931, at a time when 2,600,000 persons in this country were unemployed. The bare statement of these facts is a sufficient answer to those who pin their faith to State-aided works as a complete cure for unemployment, or even as a substantial contribution to the solution of the problem. The enormous financial burden on the Government and on local authorities caused by the initiation of these schemes contributed largely to the financial collapse of this country in August, 1931.

Another argument is sometimes put forward—it has not been heard this afternoon—that a primary cause is what is known as technological unemployment; that is, unemployment caused by the introduction of machinery or rationalization, or by other methods, whereby endeavours are made to increase production and still use smaller quantities of labor. That is an old cry. It has been heard in this country ever since the Lancashire weavers destroyed Arkwright's spinning frame. It is heard whenever any new big improvement is made in machinery or whenever any new method of manufacture is contemplated. The truth is that, although the introduction of machinery, or the perfecting of a particular organisation in production causes temporary disturbance and temporary unemployment, in the long run it increases employment. Let me give two examples to illustrate what I mean. Take the cotton industry in this country. Those Lancashire weavers who destroyed the spinning frames never dreamed of the number of people for whom employment would be found in future years in Lancashire through the mechanisation of the cotton industry. The other example I take from the United States of America, and the boot industry. If we compare the period from 1890 to 1927 and contrast what happened in that part of the boot industry in America where boots are made by hand and that part of the industry where they are made by machinery, we find this remarkable result, that whereas in those 37 years the number of persons employed in the hand-made boot industry-dropped from 39,000 to 23,000, the number employed in the machine-made boot industry rose from 60,000 to 203,000. Against a loss of 16,000 persons in the hand-made part of the industry has to be set a gain of 143,000 persons in the machine-made part.

The truth is that rationalisation and improved methods of production result in greater production and, ultimately, support a larger population and raise the average standard of comfort and leisure of the masses of the people of the country. If one looks back and contrasts the position of Europe today with what it was 100 years ago one finds that Europe is feeding some two and a-half times as great a population now as it did 100 years ago, and no one will deny that the whole European standard of life of the great masses of the people has improved. The Chancellor of the Exchequer has outlined the method by which the Government are endeavouring, and propose to continue, to fight this problem of unemployment as it affects this country. The Chancellor of the Exchequer will not dissent from the statement that it can be summed up in the restoration to industry of the power to employ men and women on work which is economically justifiable.

In their efforts to bring about that state of affairs they have taken certain steps. They have prepared, and are preparing, the way for an ultimate reduction in taxation. That has been done by economies in the public services; and here I think that no words of praise are too high for the manner in which these necessary cuts in pay have been received by the great bulk of the public servants of this country. Secondly, by economies in the public Debt secured by the various conversion loans. They have, moreover, taken a most important step in endeavouring to make it possible for our industries to supply more of our own needs through restrictions on unnecessary imports by means of Import Duties. They have endeavoured to increase the sum total of the trade of the Empire through the agreement reached at Ottawa, and they are extending that principle by negotiations which they are carrying on to-day with other foreign countries. They are also engaged in the exceedingly difficult task of overcoming the difficulties due to the breakdown of the gold standard, difficulties for which the United States and France must bear a very large share of the blame. These steps, which the Chancellor of the Exchequer has outlined to-day, will in my opinion prove in the long run to be the only way of tackling the unemployment problem in this country. Progress may be slow by this method, but is it not better to go up the hill of prosperity slowly rather than rush down the hill of chaos quickly?

7.26 p.m.


The hon. Member for Colchester (Mr. Lewis) has had a university education and one would have expected a well-educated man to know that unemployment did not come to this country when the Labour Government came into office. It has been here for a long time, and it is largely the creation of the capitalist system. Indeed, supporters of the capitalist system say that it is essential that there should always be an army of unemployed. We do not say that the Government are responsible for unemployment, but Government supporters seem to be particularly anxious to make the country believe that all the difficulties from which we suffer today are due entirely to the coming into office of a Labour Government in 1929. We do not expect the present Government to get rid of unemployment. There are some parts of the statement made by the Chancellor of the Exchequer today which meet with our approval. The right hon. Gentleman will agree that we have been persistent supporters of the idea of international agreement and co-operation. I do not propose to make any further reference to that speech; there is no need for any reply from these benches. The Chancellor of the Exchequer was effectively answered from his own side, by the right hon. Member for Epping (Mr. Churchill), who made it perfectly plain that he, and those for whom he speaks on the other side, are not in agreement with the policy pursued by the Government. I have no doubt that his speech will be strongly criticised by supporters of the Government but I say quite frankly that the speech was a credit to the right hon. Member for Epping. It showed that he has some little humanity.

If I do not approach this subject from the same standpoint as other hon. Mem- bers I shall be compelled like them, to give figures. If improvement has been made it has been somewhat lopsided. The Government appear to imagine that there is no such place as Scotland, and I want to speak more particularly of the conditions in that country. There has been an increase in the number of insured persons in England, in January, 1933, as compared with January, 1932, of 37,290; not a large increase, but still an increase. In Wales during the same period there was an increase of 12,650 insured persons. In Scotland there was a reduction of 9,901. The unemployed in England increased by 152,573. Taking the increase of insured persons from the increase in the number of unemployed, it is clear that the position in England was worse in January of this year than in January of last year. In Wales there has been an increase in unemployment of 19,354, and again we are entitled to deduct from that number the number of additional unemployed during that year. That would show that the position of Wales was worsened by 6,704. In Scotland the unemployed have increased by 32,791. If you add the figures of the number of insured persons, namely 9,940, that shows that the position in Scotland has been worsened by no less than 42,731. We have in Scotland about 1,300,000 insured persons. In England there are over 10,000,000 insured persons. Unemployment in Scotland has increased by 42,000 as against 85,000 in England.

I would suggest that expenditure of public money on any form of help by the Government should be directed mainly to those areas in which unemployment is rampant. I do not think that the Government have done very much to the advantage of Scotland. Let me come to another aspect of the matter on which I want some information. Although not a university man I take some interest in figures. I may not be able to put them together in the most approved way, but I think that the figures I am about to recite are correct. According to the Census of 1931 the population of England is 37,354,917. The insured persons are 10,440,670. The unemployed, according to the January unemployment index, are 2,266,493. That is in England as a whole. Now take the five northern counties of Lancashire, Yorkshire, Durham, Northumberland and Cumberland. You find there a population of 11,849,350, or 31 per cent, of the total population of the country. The insured persons in those five counties are 3,885,070, or 37 per cent, of the total of insured persons. The unemployed in those five counties are 1,080,470, or fully 47 per cent. of the total unemployed in England. Unfortunately, the problem is not a national problem; it is confined to a comparatively small area.

Let me take another surprising return. Take the 11 counties of Bedford, Berkshire, Buckingham, Cambridge, Sussex, Hertford, Kent, Middlesex, Oxford, Surrey and Sussex. They have a population of 8,808,322, the insured persons number 1,785,250, the unemployed are 269,616. Take the three counties of Durham, Northumberland and Cumberland. You have there a population of 2,505,598, insured persons are 710,520, unemployed 268,767. That is to say that there are as many unemployed in those three counties as in the 11 counties in and around London. There are a great many hon. Gentlemen in this House who do not know what unemployment really means. If they represented constituencies of any of these northern counties they would adopt a less complacent attitude when we discuss matters of this sort.

I ask the Government whether there is any justification for such a disparity existing between men in the same country. I suggest that the five counties of Lancashire, Yorkshire, Durham, Northumberland and Cumberland have rendered an infinitely greater service to the creation of this Empire than all the rest of England put together. I have considerable sympathy with my fellow-workmen in the North of England. I do not look at this matter from a prejudiced national standpoint. I claim that the men in the North of England and the men in Scotland are as much Britons as anyone here. During the progress of the War no part of the country rendered greater service. Durham and Northumberland and Cumberland are mining, engineering, shipbuilding, and iron and steel areas. It is in these industries that there is the largest percentage of unemployed. If unemployment had existed for a few months only, or if it could be traced back only to 1929, there might not be so much ground for complaint, but hon. Gentlemen know that so far as these industries are concerned we have to go back to the end of the War. During that period right up to now there has been unprecedented unemployment in these industries, and now there is practically desolation in the homes of the people.

These industries are not to be compared with the industries and occupations and the counties in which unemployment has been known for a comparatively short time. Unemployment has become chronic in those northern areas. Hon. Members might regard with more sympathy the feelings expressed by representatives of those areas, because of the horrible conditions that have existed there for 10 or 12 years. In my own industry we have had nearly 12 months of a stoppage. We have tried to induce the coal owners and the Government to have the industry organized in a really sound and business-like way, but as we are ordinary members of the community and of the working classes we are assumed to have no knowledge of the problems with which the country is afflicted. I am sick of hearing men tell us that we do not put forward any constructive proposals. If the addition to the total of unemployed is constructive, then thank Heaven we are not constructive.

Let me come again to Scotland. According to the unemployment index, in every county but four there has been an increase of unemployed during the last 12 months. The bulk of the unemployed are in the Clyde area, and the Clyde area includes the three counties of Lanark, Renfrew and Dumbarton. I do not wonder that my hon. Friend the Member for Dumbarton Burghs (Mr. Kirkwood) is sometimes a little bit obstreperous in the House, for it is known by his colleagues from Scotland that unemployment is higher in his county than in any other county in Scotland. There is no question that the Government could modify the position in that county very materially. I do not know who is responsible for the holding up of the building of the new cunarder, but I gathered from the statement of the Chancellor of the Exchequer this afternoon that the Government have some responsibility in the matter. At least they could lend some part of the surplus capital that is looking for employment, and I think they could get reasonable conditions from the Cunard Company. That would mean & very considerable improvement in the engineering and shipbuilding industry.

We feel very strongly— and I think rightly so—on the administration of the means test. The means test only touches us and the men whom we represent. I know some of our honourable opponents who venture to justify the means test. I do not object to it if it is to be applied equally. Let it be applied all round. At present you apply it to me and you consider that £ 360 a year is sufficient for an ordinary working man Member of Parliament; but you pay £1,000 or £2,000 a year to men who render less service to the country than Members of Parliament, to men who are largely responsible for what is going on today and who do not know anything at all about the effect of unemployment upon the moral and character of the men affected by it.

I wish to God that some of the people who talk so complacently about the cure of unemployment and the relief of unemployment had a share in what I have had to deal with this week in the case of a man who served for nearly four years in the Army during the War. He is the only wage earner in the household and even if he works all the week he only gets 27s. 6d., but he has been refused relief by the public assistance committee acting on instructions from the Minister of Labor and the Ministry of Health because of a son who had also been working but who left the house at the end of last year. Is there any law in this country which compels a parent to keep at home a son who is unwilling any longer to live in his father's house? I do not believe that there is, but I know that this man, who is as decent as I am or as any of us are, who has rendered service to the country, is in this position—that he and his family are practically being starved. I have a letter from the town clerk in my constituency this morning telling me that this case is only one of a number in which people are being similiarly treated.

There is ground for considerable complaint even on the part of Tory Members against the drifting policy of the Government in regard to this matter. There is no doubt that the treatment which is being given to the unemployed could be infinitely better than it is. The Employ- ment Exchanges and the whole administration in this matter is being used in a diabolical manner for the purpose of reducing wages and a situation may be created which will prevent any real recovery by this country if that policy is continued much longer. I make an appeal to the Government. I do not urge these matters because I am antipathetic to the Members of the Government. I have no time for cursory references to individual Members. I want the Government as a whole to use all the power and influence they possess to remedy grievances which have nothing whatever to do with international conferences but affect our own people here at home. I ask them to give the same treatment to the man in Newcastle or Glasgow as is given to the man in Birmingham or in any of the towns in the South of England. Give these men at least sufficient to maintain their moral as workmen so that when the time does come when they can be reabsorbed into industry they will be able to enter into their work with the same efficiency as they had when they were unfortunately thrown out of employment.

I appeal to the good will of Members of the House. I ask them not to look upon this purely as a party matter. We do not want to make party capital out of it. We do not care who gets the credit provided that there is an improvement in the conditions but if private enterprise cannot find work for these men it is the duty of the State so to organise industry that at least the majority of them can be absorbed. If they cannot be absorbed then they are entitled as citizens of the British Empire to have meted out to them much better treatment than they are receiving under the present administration.

7.52 p.m.


I hope that I shall not be accused of complacency if I speak in a normal voice and do not refer in detail to the privations which we know are suffered by our fellow countrymen. I believe that the Government have a splendid case to put before the House and that the point made today by the Chancellor of the Exchequer cannot be contradicted—that national expenditure does not encourage employment to any marked extent and is not going to solve our great difficulty in this matter. I be- lieve that subsidies on the whole increase instead of reducing costs. If what some Members of this House are asking for is a little window-dressing, so that the steady policy of the Government can be tolerated more easily by certain members of the State, that is a different matter, but it remains the fact, as the Chancellor of the Exchequer has pointed out, that expenditure will not solve our main problem and that subsidies will put up costs. Those two facts seem to undermine completely some of the suggestions made from he Opposition benches.

It is difficult to find anything new to say on unemployment, but I should like to make some remarks and offer some suggestions with which I hope the Government will deal at the end of this Debate. Back Benchers, like myself, in dealing with these subjects, are apt to speak into very thin air and to comparatively listless hearers and sometimes we do not get any reactions to what we suggest. I believe that the normal unemployment in this country can be regarded as inherent in our industrial system. I refer to the normal unemployment of the man who goes out of a job for a week or two owing to various causes which we all know, and then goes back into another job. Unemployment insurance provides for that man, and I do not think that his is a very serious problem. The next classification is the man who suffers from long-standing unemployment, the man who has been out of employment for months. Such a man is not easily catered for by unemployment insurance. How then can we deal with him? It seems to me that the Government's policy of improving trade conditions, however slow it may be, will help that man eventually to get into work. It is the right policy and the man in that classification is susceptible to improvement in trade.

There are two things which might be done to give a slight stimulus to trade which are not as far as I know at present in contemplation. One of these is the revival of trade facilities. We have plenty of cheap money and I suggest to the Government that if trade facilities are revived, the money should be put at the disposal of industries and not of individuals. When trade facilities were in existence before, the system was for the Treasury to get into communication, say, with a company which desired to put down a new rolling-mill or something of that kind. The finance was arranged and the mill was put down but very probably —and I know that it happened in certain cases—that only caused unnecessary complication in the industry and increased production at the expense of those who were already in the industry and competing with each other as hard as they could. Therefore if the Government revive trade facilities I submit that they ought to negotiate these matters with the industry concerned, as a whole, and thus help the planning of industry, of which the Government and I believe everybody in the House are in favour.

My other suggestion is this. Many companies which have struggled and striven through this terrible period of depression now find that when, as I believe, trade is going to improve, their liquid resources, their working capital are completely exhausted. They have been helped by the banks as far as possible but the banks naturally require security, and they have no further security to offer for the new money which they must have to carry on their business. After a period of depression liquid resources are dried up and when firms want to start work again and to take on new hands and get going on production they must have liquid capital. I believe that industry in this country is going to be in a very difficult position as soon as trade revives again and that this liquid capital is urgently needed. Some of this cheap money to which I have referred ought to be made available to industry on short term loans. Perhaps by means of a big finance corporation help could be given in this way and a guarantee could be given which would definitely assist industry.

I now come to what I regard as the worst feature of this problem and that is the standing army of unemployed which I believe has increased from about 100,000 to the neighbourhood of 500,000. These are the people who have been out of employment for 12 months or more. Personally, I believe that the rates of relief at present distributed by public assistance committees are definitely inadequate to support able-bodied men or women in fitness over a period of a year or more. If we take the line in this matter at 12 months—though the unemployment may go further back than that —I do not believe the present relief to be adequate to keep these people fit and capable of taking up their work again.

Not only that, but these people fall out of health insurance. Very likely they become six months in arrears; they are called upon to pay up, and it is obviously impossible for them to do so. Therefore, they may find themselves in the unfortunate position of being out of medical benefit at the time when they certainly need it. Training schemes, unemployed centres, and the National Council of Social Service do excellent work in their way but they do not touch the terrific problem of the man who has been out of work for 12 months or more. You cannot get at him and I do not believe that he is amenable to trade improvement. He may eventually be amenable to such improvement but not for a long time, and I urge on the Government" that this class merits quite different treatment.

It may be a terrible thing to say, but I believe we have to face it, even if it costs this country a lot of money. We cannot afford to have hundreds of thousands of men festering, rotting, after 12 months' unemployment, without any hopes—and they have no hopes after that time—of getting back into work. I think the sore in our midst from that group of men is much more important than the cost of remedying that condition, whatever it might be, and I frankly and straightforwardly ask the Government to consider taking on these men and putting them to some national work. As soon as they have been out of employment for 12 months, or for some such period, they should report to some centre in their locality, and the Government should take those men and put them on to national work, slum clearance, land drainage, anything you like. This is a problem we must meet, and we cannot go on assuming that we can deal with these men by the ordinary methods of trade recovery, because they are definitely outside of it.

The final classes are those young people who want training, and they are getting training, and then the people who are gradually being frozen out of the employment field because they are unfit, or, if they are not altogether unfit, they are not as fit as their fellows. They may have rheumatism or all sorts of things which make it difficult for them to compete with other men when they go for a job, and they are gradually being frozen out of the employment field. I believe that those people, at a certain point—it is difficult to draw a line—should be taken out of the employment field altogether and dealt with separately.

My point of view is that the Government policy, as stated time and time again in this House, is uniformly correct in every field which it touches—economy, trade recovery, and the restoration of confidence in the world—but I feel that there are special points, which I have tried to mention, particularly with regard to those men who are the stagnant, standing army of people who have been out of employment for 12 months and more; and there are the various suggestions that I have very humbly made as to how the Government should use cheap money to give a stimulus to industry. I believe that we may be at the parting of the ways so far as industry in this country is concerned, and that it will never be as it was before. The future is completely new to us, and I do not think any one of us can say what is going to happen, but I am convinced that if we do not deal with this unemployment, and if the next few years cannot show a definite improvement and that we have got it by the throat and are going to do away with it, no party now in this House, however complacently they may feel that they are representing the workers' interests, will be asked to make the extraordinary, revolutionary changes which will then be demanded by the people of this country.

8.4 p.m.


We have heard during this Debate and other Debates on the same subject a re-hash of historical phenomena combined with modern technocracy. Those of us who have been in the movement long enough can go back in memory about 40 years, to when we were youngsters. Then the problem of unemployment was only just beginning to show itself, and England was beginning to lose her position as the workshop of the world. Since that time the development of other countries has taken place, but we provided the countries that we are now grumbling about with all the technical machines whereby they could defeat us in the international markets. Lancashire was then the hub of the universe; now it has become the hubbub. Machine production became the order of the day, with the result that we sent all our powers of production over the seas, North, South, East, and West, and gradually the product of those machines came back to us in the form of cheaper goods produced by cheaper labour. Although Lancashire was the home of Free Trade, Lancashire eventually became Protectionist, because when they found their markets being taken from them, they shouted out for what they had previously opposed, namely, protection against international competition.

We have now reached another stage. I heard an hon. Member opposite talking about the Luddite riots, the destruction of machinery in the early days of machine production. Well, we know that the workers at that time had no education, and the party to which the hon. Member belongs tried to prevent their having any. For years we had to fight for the right of the ordinary child of the working-class to have even an elementary education. In their ignorance, they thought the machines were the enemies. We, as Socialists, believe that the machine, properly used and controlled, is the friend of man, that instead of men having to work long hours for little pay and under bad conditions, by the aid of the scientific development of machines they would be able to produce more and more and enjoy more and more; that is, if we had proper control of all the products of human labour. But now we have reached the stage when we have annihilated space. We have bridged the oceans and conquered the air, practically; and we have won the Test Match. I heard about that this morning, almost before it was finished—a marvel of scientific development, of man's power over nature.

Yet in may own constituency I can go down to-morrow morning and, with every warehouse chock-a-block, full of everything worth having, with barges lying along the quaysides filled to overflowing with all the products of human ingenuity and labour, I shall see men, women, and children going short of the ordinary commodities necessary for their existence. We have solved the problem of produc- tion, and I believe what Lord Balfour, one of our great statesmen, who has gone, said in one of his speeches when he was Member for North-East Manchester: "The 19th century will go down to history as the century in which men tried and succeeded in solving the problem of production. I look to the 20th century, and I can see that that will be the century in which men will try, and I hope succeed, in solving the problem of distribution." Men are not poor because God is angry, or Nature is destitute. We have not got unemployment because men cannot work, because they have lost their capacity. We have unemployment because we cannot correlate our consuming power with our productive power; and every country is in the struggle, in the scramble for markets. Even in the East we see it now. Countries which a few years ago were living under conditions of mediaevalism are now coming into the international struggle for fresh markets, and, if war does take place, it will be a consequence, not of any antagonism between the races, but largely of the economic antagonism between people struggling for fresh markets.

I only pretend to be one of the common or garden Members of this House. I have not seen much of the books, and I do not know much about the figures in the books, but I do know a bit about the figures in the streets, and I see the figures in my own constituency around the docks of a morning. Let those of you who told us that Tariff Reform would be the way out, that Protection would help our people, come with me to-morrow morning to the Albert and Victoria, to the King George, or to any other of the London docks or to those of any other industrial port in the country, and see the men mustering on a half chance of half-a-day's work, and see about 60 per cent. of them turned away from the dock gates, hopeless, nothing doing. If they get two days' work a week, they are on what they call the Royal list, but the rest of them are down and out to start with.

My hon. Friend the Member for Darlington (Mr. Peat) suggests that we should segregate the unemployed, that we should divide them up into compartments. Some of them will never go back to work again—those who have been out of work for 12 months or longer. I know of men who have not had a day's work for three years. They have come to me and asked if I could do anything for them with the foreman working for the Corporation, for a few days on the road, sweeping—men I knew myself who were boilermakers and ship repairers, men who a few years ago, if you had asked them to take a broom, would have refused to touch it because they would have thought they would be demeaning themselves if they had done so. The Government are now providing sticking plaster for wooden legs. There is a story of an old lady, who came back from a drive on a cold winter's day in the West End of London, telling her footman to remind her of her annual subscription to the blanket fund for the poor of her parish, and who, when she got back home, took off her fur and sat in front of a blazing fire in her drawing room, and when the footman reminded her of her subscription said, "John, don't worry; the weather is a lot warmer now than when I was out driving."

Charity is put forward in these days, in the 20th century—charity, the conscience money which the rich man pays for the robbery of the poor—and it is put forward as a proposition in these days while the rich are grumbling about the taxes they have to pay. They say that the limit of taxation has been reached, but if that is the case, they cannot afford to give any more, and they cannot respond to the Prime Minister's appeal. I do not believe in private charity. I believe, with my friends here, in public justice, and public justice can only be done by public organisation. Many can help one where one cannot help many, and the community organised can do what no individual section of it can do; and the working-class, after all, are an important part of the community. We have developed an industrial system in this country which, after all, has been copied by every other country in the world, and to some of us on these benches the problem of unemployment is easy of solution. It is a matter of organising our industry upon a co-operative basis, the organisation of wealth production on the basis of the greatest good for the greatest number. To-day we have all the means necessary to produce wealth in superabundance. That is demonstrated. We have all the capital necessary. The banks are already saying that they have more money than they know what to do with, and that they cannot find avenues for its further investment, while, on the other hand, millions of men and women are willing to work if only they can get the chance. I am a bricklayer's labourer by profession and a Member of Parliament, some people say, by accident. I used to carry bricks and mortar up a ladder to the chap on top who did the work, when I was younger than I am now. There is an abundance of money, and there is labour in abundance. Why cannot we all work together? What stands in the way? The only things in the way are some interests that have not yet been explained to us. The whole system has come to a state of collapse. Ships are to-day going away from the Albert and Victoria Docks in my constituency on holiday cruises. They call them luxury ships. People are going in them to get away from the turmoil and the despondency that exists in Great Britain, A few years ago these same ships used to go all over the world taking merchandise and passengers and bringing goods back. To-day they are simply on the level of, "Who's next for the Skylark'?" They are big ships that used to be doing good work taking passengers and cargo, but mostly cargo. To-day they are going out with luxury travellers, although they are not luxury in the real sense, for it used to cost them £2 a day; now they can go for £l a day. If there is no cargo coming in, there is no cargo going out, and the stevedore and the docker walk the streets and wait round the docks not knowing what will happen next.

What proposals have the Government got? Nothing, and we are told if we will wait and see everything will be all right I am sorry that a man whom some of us used to respect and admire has made himself responsible for a policy of the character that has been adumbrated here to-day. He may be Prime Minister and the darling of the gods to some people, but we thought that he would at least put before the people with whom he is connected, who are mostly members of the Conservative party, the Labour point of view and would make them understand that great economic and social problems cannot be solved by merely hoping against hope and waiting for something to turn up. He is no longer the Prime Minister whom we used to know. He is Ramsay Micawber. We on these benches have not given away our principles in order to form a National Government. It is not a National Government; it is a National mix-up, a conglomeration of all things that do not matter, of men who hang together because if they do not they will hang separately.

There are already signs of a rift in the lute. The right hon. Gentleman the Member for Darwen (Sir H. Samuel) discovered that he had to leave the sinking ship, and there are others who are waiting to see which way the cat jumps. I ask hon. Gentlemen opposite what their policy really is? Do they realise the causes of unemployment? You can fiddle about with tariffs and play about with questions of the relationship of this country and other countries, but you have to recognise that the industrial system which you defend has reached the end of its tether. Just as early capitalism went, modern capitalism is going too. We see it in America. A few years ago I was told that America was going to show the world. It has shown the world—the way to bankruptcy. To-day its finances are in a state of disintegration. The private control of finance has brought it to the verge of ruin, and manufacturers are in such a position that they cannot call their souls their own. Our manufacturers are almost in a similar situation. The power of gold is uppermost, and the man who sings "God Save the King" in broken English dominates the situation.

There is plenty of work to be done. I can take you to my own Division and show plenty of improvements that can be done—useful work, not relief work. Decent houses could be built for the people, providing you can give the people the opportunity of being able to pay the rent for decent accommodation. You cannot do that under the Housing Bills proposed by this Government. The landlords in the East End of London are not the landlords we use to have, who used to own the house and perhaps build it. The new landlord is the tenant himself; he does not let the whole house, because people cannot afford to take it. He lets the rooms separately and by the end of the week he gets more out of the rooms in the house than he pays for the whole house. This man, who is making his fellow workers pay an exorbitant rent, has learned his lesson from the other fellow. The result is that in my constituency families of five, six or seven live in one room and pay a rent as much as the rent I paid for a house 30 years ago when I was married. That problem is not being touched by the Government. With them it is a case of a pot of paint and a piece of wallpaper and everything in the garden will be lovely.

We say that unemployment can only be solved when the economic facts of to-day are realised. A new system has come into operation—technocracy as it is called. The introduction of machinery in the first place brought about a new conception in the lives of the people. Now its universality is creating another mentality. Having solved the problem of producing wealth, cannot we now solve the problem of its distribution? What have hon. Members supporting the Government to offer us? What solution do the Government propose? They have the biggest majority of any Government that I can remember, and I have read back a little bit, though I do not suppose I have read so much history as hon. Members opposite. I ask the Government what proposals they are making to meet the present situation. Every country is in a similar position—every great country is in a worse position than we are. All we get from the Government is this miserable abortion, there are no serious proposals of any sort. The Government are simply waiting for something to turn up, and they will go on waiting until the end of the chapter. They have a big majority, and they can afford to wait, and for 12 months or two years they will carry on. Surely the back bench supporters of the Government have not lost all conscience. They are not afraid of their position. They went out into the constituencies, as we did, and said they had ideas for the solution of these problems. Where are the proposals now? The Government have turned them down. All the prominent persons in the Government have gone away. Perhaps they have gone to ruminate. Rodents do that, I imagine. We on. these benches say the time has arrived when the Government should either get on or get out.

8.27 p.m.


I think that so far as the back bench supporters of the Government are concerned the Debate to-night has shown three things. With great respect to the hon. Member for Silvertown (Mr. J. Jones), I do not think any really solid and constructive alternative proposals have been put forward by those who are endeavouring to censure the Government to-night. They have talked about a change-over from the capitalist system to the Socialist system as being the only hope for the future, but such a proposal is not practical politics to-day. What would happen to those whom they claim that it is their monopoly to represent—the unemployed of this country—during the transition from a Capitalist system to a Socialist system, which has always failed hitherto whenever it has been tried? The second point is that although we may agree to a small extent with some of the remarks made by hon. and right hon. Members of the Opposition during this Debate—of course, we cannot help agreeing with something, although from our point of view that is sometimes awkward—we cannot help feeling that those who are censuring us to-night will go down to history with the epitaph that they were men who worked harder and more consistently in order to achieve failure than any set of men whom Parliament has known for a long time. I do not know where the Liberal section, led by the right hon. Member for Darwen (Sir H. Samuel) stand. They are still balancing. The position, politically, of the right hon. Gentleman reminds me of the words of William Blake: Thy friendship oft has made my heart to ache, Do be my enemy for friendship's sake. I do not know whether they are following the tradition of the last two years of speaking this way and voting that. Honestly, I cannot decide from the speech of the right hon. Gentleman whether he will censure the Government by imputation and is going to support them, or whether he is supporting the Government but would like to have voted against them only he does not think it wise tactics or policy to do so.

It is common ground in this House that the problem confronting us is a most appalling one, and when the leader of the Opposition said that if we had any imagination we should turn loose the writers of this country to go round and describe the miseries of the poor, I do not think he meant to convey that we on this side do not feel equally keenly the troubles and the miseries we see around us. We may differ as to the means of solving the problem, but at any rate I ask the right hon. Gentleman to give us credit for the sincerity of our feelings. I fear he denied it to us by imputation, though I know he will not deny it in answer to a straight question.

The figures of the Ministry of Labour show that we have men of 50, 55 and 60 years of age with fine industrial records who will never again work during their lifetime, and that there are young men of 18, 20 and 21 who are never going to work again in their lives, who are never going to have a chance of working. That is the situation we have to face. Even though we have a trade boom we shall still have a high unemployed content in the population. We cannot afford to have relief works. Everybody has condemned relief works.


I take it from you that you are positive in your assertion that men of 60 will not work again, and that you feel convinced that there is no opportunity of employment for men of 18 and 20. Then the question is, What are those men going to do?


The hon. Member has almost stated my question to the Government. I do not say that all the young men will not find work, but there is a certain proportion of young men who will not get work. I do not think the Minister of Labour will deny that our population has increased and that the migration figure has dropped, and that the rationalisation of industry will, during the next few years, have an immediate effect on the absorption of men into industry. We have come to the situation that we cannot afford relief works. From the balance-sheet point of view it is cheaper to keep a man in idleness than to put him to work. It is a cruel statement to have to make, but it is so; and yet I submit that from another point of view we cannot afford to allow these men to continue in idleness ail the rest of their lives. Are we up against something which we cannot tackle? Is the position an impasse? We cannot afford to employ a man, though from the moral aspect we cannot afford to leave him in idleness. What are we going to do?

I wish to put forward a humble suggestion to the Government, and I would ask the House to receive it without adopting what I would call the "No" attitude of mind which is revealed so often when something new is brought forward. I know in my own business that when anyone brings some new proposal before me I have to steady myself to prevent me from saying "No" at once simply because it is something new. I want to think it out, and I ask the House to think it out, so that we can see whether there are any good points to come from it, and, if we see any good points, perhaps my idea may be thrown away—it does not matter the slightest bit—but some good will have come out of it.

There is an enormous number of public or private works which are not going to be done under present conditions, because capital wants a reasonable return, and labour works in accordance with strict trade union conditions. I am not advocating that we should countenance the breaking down of the hard-won and all-too-low standards of trade union work, nor do I advocate a state of blacklegging for the available jobs. My suggestion is that when a man goes on to transitional payments, having exhausted his insurable period of benefit, that benefit should not be treated as something sacrosant, something almost sacred. Could it not be made more fluid. There might be some local committee. Our courts of referees have, generally speaking, worked very well and impartially. I am suggesting a local committee that would consider applications for schemes of local public, or possibly private work, and that would assess the amount of money and of labour costs involved in them. It would receive that money, or very nearly that amount, from the public body or private individual that was going to benefit from that work. The men from the Employment Exchange should then be allowed to go and do that work, so that the money should be paid, not to those men, but to the local Unemployment Insurance Fund. It should be paid to the credit of the general fund from which transitional payments come, so that every man who draws transitional payments should have some opportunity of being able to work for them.

I would like to make this further suggestion. It is dangerous to talk of subsidies on wages. I see in the "Times" newspaper, which is always well-informed, that the Government have abandoned any such thought. I would not suggest a subsidy on exports. There are various schemes where a very small amount of help would enable an enormous saving to be made on the Unemployment Insurance Fund and would also enable men to be absorbed. I have been at some trouble to get figures about steel sleepers. I can vouch for these figures because they come from one of the railway combines. I only give them to the House as an example of what may be done. There is one railway system which does 500 miles per annum of renewal of railway sleepers. At present those renewals are done with imported wooden sleepers. Steel sleepers cost approximately £2,700 a mile, and wooden sleepers approximately £2,000 a mile, so that the railway company simply cannot afford to use steel sleepers. Approximately 10,000 tons of steel are used on 70 miles of rail. Allowing for transitional payments at 30s. a week, which is what would be paid to a man with a considerable family, means that you are spending approximately £200,000 a year in benefit for men who would be employed in turning out steel for those steel sleepers. The difference of cost between using wood sleepers on that 500 miles of railway is approximately £350,000 and you could have saved £200,000 in direct benefit, and you also save £200,000 in indirect benefit, because if you put one man to work you will be putting another man somewhere else into work as well.

This is only one small suggestion and I know that the "no" mind can easily dispute my argument and can say that there is nothing in it. We have to approach this problem with new ideas, throwing away what the "no" mind has built up, which is that we must always travel along set and carefully prepared lines. We are loyal supporters of the Government, and this is an anxious and loyal House of Commons. We want to ensure that when we go to the electors once more we can say that whether or not we have achieved everything which we had hoped for—and no man ever achieved everything he hopes for; he would be a happy man if he did; or perhaps he would be a miserable one, I do not know—at any rate, we have done our very best. We have left no stone unturned in putting forward our individual and collective efforts to solve the greatest problem that we have before us to-day. We should see that those who have an apparently hopeless future, in the present state of affairs, are given some hope by the present National Government and by the present Parliament.

8.42 p.m.


When as a younger man I used to read the accounts of the Debates in this House, I always noticed that every hon. Member, in addressing the House for the first time, asked the House for its indulgence. As the terms in which they appealed to the House seemed to me to be somewhat similar in each case, I used to think that that was a pure convention, but I assure the House on this occasion that I know that that appeal was a real necessity. I therefore venture to appeal to the House for its usual kindness and indulgence. I do not want to presume upon the kindness of the House or to stand between it and many speakers who, I know, desire to address the House on this very important question of unemployment. I have been here only a few months, and therefore I am somewhat unfamiliar with the procedure and the practices observed in the Debates. As hon. Members will see, I ought at my age to have had some little experience. I have listened to many Debates on this grave question of unemployment, and I have been impressed by what I have heard from the Government Bench and from the Front Opposition Bench. I think that the House generally realises the importance and gravity of the situation.

In approaching this question, I ask myself whether the general policy of the Government is directed to deal with this problem from two points of view—in the first place, as a problem of an emergency, and, secondly, as a problem which involves consideration of the question of consolidating our industrial and trade position so as to meet the present conditions. Those are two aspects of the problem which I imagine the House will have to consider. I was glad to hear from the Minister of Health in the Debate last evening that he was anxious to disabuse local authorities of the idea that the Government is putting a blockade—those were his words—against public works. Knowing the conditions and what is happening in some parts of the country, I sincerely hope that local authorities will take immediate advantage of the Minister's words, and will themselves put a fresh initiative into the consideration of schemes with which I hope they will trouble the Government on the earliest possible occasion. I believe it was necessary to remove this misapprehension, because, judged by the attitude of some local authorities with which I am familiar in regard to work of this character since September, 1931, it would appear that they were convinced that it would have been of no use to put forward schemes, because they would involve long consideration and protracted negotiations with the Government and eventually would be turned down.

In my own constituency, which is mainly of a rural character and skirts the seaboard, there are several thousands of people unemployed. I know—and it is obvious to anyone who is observant—that there is much work to be done in the county of an agricultural character, by way of land reclamation, road work, and the provision of adequate and satisfactory water supplies for the numerous villages on the coast. This class of work is, I venture to submit, work of urgency and of real necessity, not only for the public health, but for the development of the county agriculturally and as a health resort. I know of several schemes which had been passed and adopted at the time of the Circular, but which have not since been proceeded with, the assumption being that the Government did not regard them as coming within, the terms of the Circular. In view of the Minister's remarks, I shall certainly do my utmost to stir the local authorities to further action. In my constituency there are numerous villages on the coast, and, if I may venture to say so, it is one of the most beautiful and romantic pieces of coastline in the whole of Great Britain. There we have several villages which might very well be developed as health resorts, but to which there is no access by roads and all that roads mean in these modern days. They really need access and means of transport. All that, however, has been stopped by the Circular of 1931, and I venture to say it is time that the policy of the Government in that respect should be reversed.

Turning to the general question whether the general policy of the Government is directed to increase the trade of the country, I would submit to the House one or two instances which compel me to come to the conclusion that, in those respects at any rate, the policy of the Government is detrimental. I do not want to labour the question of tariffs tonight, but I cannot help observing that, again in my own county, there is a considerable number of expert and experienced seamen who have been unemployed, some of them, for many years. These men are seamen of long training, highly skilled in their profession, a great many of whom have occupied important positions as officers in the Mercantile Marine. They have built comfortable homes on the seaside, are educating their, families, and it causes one the utmost distress to see many of that fine body of men living on their capital and some of them, after many years of unemployment, on charity or some form of public assistance.

The cause of this is clear, if one has read the report of the Chamber of Shipping, which was published in the "Times" yesterday. Have the Government any responsibility for this state of affairs? Surely it must occur to every Member of the House that any contraction in our imports and exports must of necessity have its adverse effect on the shipping industry and on shipbuilding. Do the Government realise—I am quite sure that the House realises—the supreme importance of an industry like shipping and shipbuilding to the prosperity of this country? Mark its importance even today. As the report which was published yesterday says, 99 per cent. of' the coastal trade of this country is still carried on in British ships; 94 per cent. of the shipping trade between the United Kingdom and the Empire is still carried on in British ships; 90 per cent. of the Empire carrying trade is still in British ships; and 60 per cent. of the Imperial and foreign trade is still carried on in British ships. That is one industry in which this country is still supreme, having an overwhelming advantage over all other countries in the world. Nevertheless, in my honest judgment, the policy of the Government in regard to restrictions and tariffs is bound to jeopardise the security, success and prosperity of that great industry.

I would like to refer to one other point. We have heard a great deal, in this House and outside, of the actions taken by the Government which were made necessary in order to redress the balance of trade. I understand that a great many people, including a considerable number of members of the Conservative party in this House, have no mind on that question except from one standpoint only, and that is that you can redress the balance of international payments by reducing imports. They always forget that that can very often be more effectively done by increasing exports. We know what the Government have done to reduce imports. We know it has imposed tariffs. I should like the Government to tell us what plans, if any, they have to increase exports.

In 1930 our imports from Russia were £34,500,000, in 1931 £32,250,000, and in 1932 they dropped to £19,750,000—a decrease of 30 or 40 per cent. During the same years exports and re-exports to Russia rose from £9,250,000 in 1930 to £10,500,000 in 1932. So that at the moment when the export trade in British manufactured goods to Russia was rising the Government, just because of their obligations and promises at Ottawa, had to give notice of termination of the Russia trade treaty. As far as I know, the House had never been told what progress has been made with the negotiations for a new trade treaty. Surely the object of Government policy should not be to decrease the purchase of goods from Russia, which are mainly raw materials required by us, but to increase exports to that country, thereby providing a partial permanent solution of the unemployment problem. Here is one instance where the Government itself could adopt effective steps to redress the balance of trade between this country and Russia.

I know there are some Members who have almost a conscientious objection to trading with Russia. I have no such scruples at all. I would do as much trade with Russia as possible. I cannot see, if it were not for Russia, how our electrical industry would have progressed in the last two years, and there are many other industries which have benefited. We purchase from Russia £32,500,000 worth of goods. If the Government organised proper trade relations with Russia and we sent them £32,500,000 worth, that would mean on a modest estimate the employment of 100,000 to 150,000 men. I would ask the House to consider what steps the Government are now taking to re-establish a sensible position as regards trade with Russia. At any rate, before they come to any conclusion regarding new trading associations with Russia, the Government should consider the views of leading industrialists.

On the general question of preparing for the future by planning, is our industrial and trade situation such that we can take the fullest advantage of the revival when it comes, because I believe in a revival and I believe that revival will come suddenly. We know that there are countries in Europe which have set up their own industries since the War, and it is impossible to expect that we can recover our export trade in those industries. Before the War we exported to Italy large quantities of chemical and other products. Now they have set up their own chemical works. But there are still empty spaces in the world from an industrial standpoint. We have large tracts of territory in Asia, Africa, and South America. What are the Government doing to enable British industry to take advantage of those markets when a revival comes? There should be a systematic survey of these markets, not by trade delegations which come from some countries and go to others and are socially entertained at banquets. That is not the kind of delegation that I mean. I mean a delegation consisting of real experts who will make a thorough survey of the market of the world for the benefit of British industry.

May I draw attention to one other grave aspect of this problem? I want to know whether the Government realise the grave danger to the future prosperity of the country by reason of the fact that skilled men in all trades through idleness are becoming less skilled and fewer in number. Am I exaggerating when I say that, if this depression continues for a few more years, this country and other countries which are in the same boat will have been largely denuded of skilled expert tradesmen, and we shall not have enough skilled men to carry on the work when it revives? Do the Government realise their indebtedness to the young men of 19, 20 and 21 years of age and organise so that all these young men who receive public assistance shall have an opportunity of studying the needs of the country from an industrial point of view and learning the skilled trade which is staple in their locality? I do not believe it is necessary that 3,000,000 people and their dependants should eat the bread of idleness. I believe all of them would like an opportunity of giving some service in return and, although I fully realise the magnitude of the problem, I am not satisfied that the Government have yet done all that is possible to provide the workers with an opportunity to give service to the country.

9.3 p.m.


I consider myself fortunate on the first occasion on which I rise from these benches in being the spokesman of hon. Members in all parts of the House in congratulating on his maiden speech an hon. Friend of mine who sits in the place which I so recently occupied. He comes to the House with wide knowledge and long experience of industry, both within the confines of our own shores and in the Empire at large. I am sure I may, on behalf of the House, congratulate him upon the speech he has just made and express the hope that he will on future occasions give the House the benefit of his experience and knowledge. In the course of this Debate and of the Debate yesterday, reference has been made to the now notorious letter of the Prime Minister, for whose presence in the House I am grateful, for I prefer to speak in his presence rather than in his absence on this matter. I have a double reason for doing so. The letter was addressed to the Borough Council of the constituency which I have the honour to represent in this House, and it affords one reason, though by no means the sole reason, why I shall find myself, not in covert opposition to him. behind his back but in open opposition upon these benches face to face. The letter of the Prime Minister is a challenge, and, as far as I am able, I shall take up the challenge. Is is not a letter standing in isolation. It is indeed the culmination of a correspondence extending over a period of three months. It was as early as the middle of October of last year that the Borough Council of Bethnal Green approached the Ministry of Transport and the Ministry of Labour with this question: What scheme of unemployment relief works has the Government formulated that it contemplates putting in hand during the forthcoming winter for which unemployed men and women resident in Bethnal Green are eligible? The answer came swiftly, and it was unambiguous, for it was a blank negation. The Borough Council of Bethnal Green on the 21st of October of last year addressed a communication upon this subject to the Prime Minister. With unemployment as grave and urgent a problem as we all realise it to be, yet there was no reply from the Prime Minister to the letter of the 21st October until the 9th January of this year, and the reply is within the recollection of the House. It has appeared at length in the Press. It is relevant to ask from whence came the inquiries to the Government. They came from the council responsible for the administration of one of the inner boroughs of London which is so thickly congested that over 43 per cent. of its population is overcrowded, so depressed that not less than 17 per cent. of its population is living below the poverty line, feeling the effects of unemployment so disastrously that as much as 23 per cent. of its male industrial population is unemployed, so poor that whereas a penny rate in Kensington will produce £13,000, or in Westminster £40,000, in Bethnal Green it only produces a bare £2,000. And the only answer given by the Government to the inquiry from that local authority as to the intention of the Government with reference to unemployment was a blank and unequivocal negative. I am not at all sure whether the feature which has impressed me most unfavourably about this correspondence is that neither the Ministry of Labour nor the Ministry of Transport—nor according to my information, and I have sought the facts—despite the 2½ months delay in his reply the Prime Minister, made inquiry as to what were the schemes of work which Bethnal Green Borough Council was actually proposing to carry into effect. So little was this matter treated as of urgent practical importance and so largely as a matter to be dealt with merely by vague word generalities, that no one took any trouble to inquire as to what, in fact, was proposed.

The Prime Minister has taken the standpoint that relief work, by increasing the burden of local and State finances—I quote his words— will reduce the competitive power of British industry and delay its ultimate recovery. Does the Prime Minister know that the works of which he never even sought particulars have in fact been put in hand at a cost of £13,800. But the £13,800 which in Kensington would represent a relatively negligible penny on the rates, or in Westminster a negligible one-third of a penny on the rates, represents in Bethnal Green an equivalent of 7d. on the rates. Is not that increasing the burdens of local finance, and increasing them at the point where the increase can be least sustained? For the Prime Minister to describe as relief work the sort of project we have in mind—

The PRIME MINISTER (Mr. Ramsay MacDonald)

I suppose that the hon. and gallant Member is well aware that I did not describe them as relief works, but that they were described as relief works in the letter sent to me by the Borough of Bethnal Green.


The words "relief works" is a kind of shorthand used by the Government and by the Minister of Labour—I quote the phrase—"for works for the relief of unemployment." Works for the relief of unemployment comprise reproductive works, the initiative of the Government in setting on foot works of national reconstruction and also giving a stimulus to private industry. I make it clear that we have now over a long period of years advocated measures of national reconstruction, and that the State should give a stimulus to private industry. We do riot propose that improvised occupations be set on foot merely to maintain the moral of the unemployed. What we desire to see, but what we have failed to obtain from the Government, is a nation-wide plan for national reconstruction. The Prime Minister goes on to claim in his letter that the Government has directed its policy towards reviving ordinary industrial activity by creating the conditions under which industry can thrive. and that it has stayed the rising tide of unemployment, and has arrested the depression and that there are now signs of national recovery. Where are those signs and what is the justification for those extravagant, and, I venture to call them, fantastic claims? Are they to be found in unemployment? The figures show real unemployment now to be at a record high level. Ate these signs to be found in the returns of foreign trade? The January figures, compared with January, 1929, show a 53 per cent. reduction in imports, but a 57 reduction in the value of British exports upon which this nation depends. The Prime Minister claims that the Government have created the conditions under which industry can thrive. What success have the Government had in that direction? Is it found in stable prices? The wholesale price level, as measured by the "Economist" index, has fallen in terms of sterling by 11 per cent. since 1929. Are the signs of revival to be found in freer trade?—Not only have the Government by their domestic policy of Protection increased the world's already monstrous battlements of trade barriers but they failed signally at Ottawa, in spite of the Prime Minister's claim in his letter, to secure any appreciable reduction of tariff barriers within the Empire. By their refusal to take the lead in, or even to refrain from obstructing the formation of, a low tariff group between Belgium, Holland and possibly Scandinavia, as those countries would have wished, the Government have been driven back on the sterile process of bilateral agreements, from which they have so far reaped no single advantage and from which they are unlikely to do so.

But it is above all in their economic policy at home that the Government have defeated and frustrated even their own achievements. Following upon the financial panic which swept the Government into office there was a dramatic fall in interest which enabled their great Don-version scheme to be carried successfully into effect; but the monetary conditions which made that Conversion possible are not an end in themselves. They are only a means to an end. To-day, those monetary conditions in the financial sphere, represent—in a glut of idle money in the banks, in rising bank deposits and in falling bank advances—the counterpart of the prevailing stagnation in the industrial sphere, and I make bold to say that that stagnation has been accentuated by the Government's insensate contraction of all public expenditure, be it good, bad, or indifferent.

I am all in favour, as is every hon. Member who takes his responsibility seriously, of close supervision of administrative expenditure and the elimination of waste, but the Prime Minister in this letter, which is a long and fully considered declaration of policy by the head of the Government, seems to me to fail to distinguish between expenditure which has to be met out of taxation, on the one hand, and capital development, on the other, financed by borrowing by loans, if necessary guaranteed by the State, the service of which loans are, at most, a distant and contingent liability upon the Exchequer, and far outweighed by the positive savings in unemployment benefit to the unemployed. The Prime Minister and the Government seem to me to have thrown wantonly away all the potential advantages which the nation's sacrifice of 1981 brought into sight. For the past 12 months there has been no question of the Government's credit being insufficient to start a bold policy of development loans. There is no question of a dangerous deficit in our balance of payments. There is no question of a menacing weakening in sterling. On the contrary, the whole efforts of the Government and of the financial authorities in the City have to be devoted to checking a rise of the sterling exchange which would mean the final and most calamitous blow of all to British exports.

I am not concerned to-day to propound detailed schemes of reconstruction. I am not concerned to-day to go into details of reconstructive work which might be set in hand, directly or indirectly, by the State: There are a score of schemes in which the Government' might beneficially move. I am not prepared to go into details of schemes because, before it is worth while to speak of detailed schemes, it is essential that we should have a Government sitting on the Treasury Bench prepared to seize the situation boldly, prepared to use the national credit for expanding the national assets, prepared to use all the influence, power and resources of the State to give a stimulus to private enterprise, and prepared at the same time to contribute, with all their influence, to a sane reconstruction in the international field. We have no such Government now.

I am not advocating any wild policy of domestic inflation which would damage the position of the pound or which would have undue reactions on the outer world, but I make bold to say that there is no banker in England and no responsible business man. who will deny this proposition, that we could raise to-day, within a day, a loan of several hundred million pounds for reproductive works, without creating any disturbance in the world's exchange market. The money is lying idle in the banks, or being used for seeking feverish profits in gold shares, while the men are rotting in idleness. What is needed is an initial impetus, but the only impetus we have ever had from this Government is an impetus in a backward direction. We want from the Government in these times something which the Government alone can give. Private enterprise cannot give it.

Under this Government the hopes and the anticipations of private enterprise have been so disappointed that they are all lenders and no borrowers. Those are the conditions in which this Government have involved the country. Private enterprise has lost its initiative and its courage. It has lost courage, it may be, because it sees no signs of it in those who should be the leaders of the nation. Let us seize the chance. It is open to the Government to give a bold drive of initiative to public enterprise and to the stimulation of private enterprise. To sit calmly back, as the Government have done, and say: "We have balanced the Budget, or we. think we have." "We have clapped tariffs on practically every commodity entering this country." "We have saved the capitalist system," when 3,000,000 workers and their families are without work and without enough to eat, is to abrogate the functions of government and to court for society a far worse and far more certain breakdown than any threat that may come from my right hon. Friend the Leader of the Opposition. In contradistinction to the Prime Minister and to the policy set out in the letter to my constituency of Bethnal Green, I stand for a great scheme for the mobilisation of all the resources of the State for national reconstruction. I do not regard that as taking up the spade of Socialism to dig the grave of Capitalism. I regard it as a policy not only justified but demanded by sheer common sense, if we are to secure what assuredly we need, the practical revitalisation and reinvigoration of the economic life of the nation.

9.27 p.m.


Following the example of the last speaker, I will congratulate my hon. Friend the Member for Cardigan (Mr. D. Evans) on his maiden speech. May I also congratulate the hon. and gallant Member for North-East Bethnal Green (Major Nathan) on his maiden speech in his new position? As he told us, and as we are well aware, he has made his progress from these benches to those benches, but as in the course of his speech I saw him, inch by inch, making his way along the bench, nearer and nearer to the official party opposite, I wondered whether he had come to his last home in the position he has taken up. The only thing that I need mention with regard to his speech was the fact that he said he had a number of detailed suggestions with regard to actual productive schemes which he could have put before the House. We have heard this statement about productive schemes before. We remember the present Lord Passfield, when a Member of this House, saying he had hundreds of them in a pigeon-hole, but whenever it comes to producing these productive schemes we are often badly disappointed. I am only sorry that the hon. Member, even though in opposition and though he has no confidence in the present Government, could not at least have put his suggestions into the common stock, so that even if it were by an oversight the Government might have been able to adopt one or more of them.


Perhaps the right hon. Gentleman will allow me to say, I hope without presumption, that both in the last Parliament and in the early part of this Parliament, I have endeavoured to do so, as the records of the House of Commons OFFICIAL RRPORT will show. But now I have almost given up hope.


Then perhaps the hon. and gallant Member might take a leaf out of modern journalism which realises that even by reiteration you may in the end get the acceptance of an idea. When I listened to the hon. Gentleman's speech and also to the other speeches made to-day, I found common agreement upon one point,. and that is a very genuine sympathy for the vast hundreds of thousands of men and women who are actually suffering. It is an equally genuine sympathy whether those who share it have the eloquence of the right hon. Gentleman the Member for Epping (Mr. Churchill) or not, but, apart from that, there is one singular feature which has arisen from them. I listened to the speeches of the right hon. Gentleman the Leader of the Opposition and the right hon. Gentleman the Member for Darwen (Sir H. Samuel), and then there was the speech of the right hon. Gentleman the Member for Epping and that of the Chancellor of the Exchequer as well as that of the Member of the fourth party who has just spoken. It appeared to anyone who listened to those speeches that if it were possible, they would each one of them try to go into different Lobbies.

At the end of all this I am tempted to ask myself whether, in the attempt to get at some truth on this matter, we cannot come to an agreement on one point, which everyone who Has studied the question realises now, though it is seldom put clearly. It is all very well to talk so much about schemes in this country, but the problem is not a domestic problem at this moment. It is predominantly an international one. It is quite different from what it was before the slump of 1929. Before then, our hard core of unemployment was largely a matter of our own domestic policy and domestic action in trade and industry. Now it is only deluding suffering people to say that, as to 90 per cent. of it at the very least, it is anything else than an international problem which can be solved only if we get international agreement on the main problem that lies before us in these coming conferences. There is not a country in the world that can cure the position at this moment in isolation. That is true of Russia. Russia, the Communist country, has to depend on what is happening in the capitalist countries to be able to get back to a tolerable standard of living. The United States, the greatest individualist country and the nearest to being self-sufficing, is dependent on what happens in the civilised world as a whole. We here, of all the countries in the world, are the least self-sufficing, and it would be humbug to pretend to people who are waiting so anxiously to know if there is some cure that there can be any real cure for their trouble except by the successful treatment of it in our negotiations with the different nations.

Therefore, if we want to do justice by the people, we should tell them that truth first and foremost; otherwise we shall only be deluding them into believing that the hardships they are experiencing at this moment, can be cured by domestic action, when it is perfect humbug to pretend that it can be anything of the kind. That is the first thing that the country, in honesty, ought to be told by everyone. On the other hand, it is no doubt quite true that the position can be alleviated by domestic measures, but only to an infinitely smaller degree, and we have to realise the limits within which this can be done. When we try to study these limits, I am bound to say I find myself looking with something like distrust upon the wide phrases which are so frequently used, such, for example, as those in the very interesting speech by the right hon. Gentleman the Member for Darwen.

The moment we begin using phrases like "national development" we get near to phrases which become in the end misleading. Many works may be undertaken which may have some value, and yet, under present circumstances, they may be infinitely harmful to undertake. It may be said that I am taking an abstract view of this question and that I have no care for the sufferings of the individual man and woman. That is not true at all. If I object to loose phrases about these schemes, which are not worth the money we may spend upon them, I am thinking of the collier, of men in the engineering works and in the shipbuilding yards. Anyone who tries to realise the state of affairs must know that if by prudent economy you keep businesses going you keep men in employment. It is all for the good of those employed. If by imprudent economy you add an additional burden on industry it may be the last straw, which means that they will have to close down and men in these works, in the engineering works and in the shipbuilding yard and in the coalfields will be thrown out of work. Anyone who heard the statement on the wireless the other night and heard the words "paid off; paid off; paid off" must realise the misery so created.

I want to make one or two practical suggestions. If I were to criticise the speech of the right hon. Member for Epping it was that, although there was a high note of sympathy for the unemployed, it did not contain any practical suggestions in any sphere. I make one simple practical suggestion. When you have an expenditure on definitely reproductive work it is in a different category to other expenditure. There is one kind of reproductive expenditure which I urge upon the Government. It is to see, if possible, that what are known as intermediate credits for industry are forthcoming and that industry should be encouraged to use them. By intermediate credits I mean something between an ordinary overdraft, which a business can be called upon to pay up at any moment the bank sees fit, and a debenture which is a quasi permanent obligation; credits which would help to finance industry for a period say from 18 months to five years. The object of it is to enable industry to re-equip itself. I am not talking from theory but from practical experience. I know of a particular case of an industry where the heads of the concern borrowed money on a limited term in order to put in a fresh unit of a new type. Before the short-term had run out the advantage of the new unit was such that they were able to pay back the money and were also able to put in another new unit without the help of any extraneous finance. That is an actual instance for which I can give chapter and verse. This is important also in regard to the future. This long enduring trouble is not going to last for ever, and when it comes to an end we in this country must be in a position, with re-equipped industries, to face the competition which will then come upon us in the markets of the world. The fact that we had this unemployment before the big slump came was partly due to the over-valuation of the £ and partly to the lack of this kind of equipment. For heaven's sake let us be ready to face the situation on an equality in the future, and be able to make the best of it. I put also this consideration to the Government. If you can get industry re-equipped it is not only good for the future but it definitely helps the present. If orders are given to the engineering shops and shipbuilding yards, and in other directions, you will have men working at their own industry and you will be actually quickening the wheels of trade in reproductive employment and you will be helping unemployment in the best way at the present time. The machinery for this policy exists, though it has not developed in the City to the same extent as other branches of financial business. I think it can best be done through private financial aid, because the difficulties of the Government in financing industry are well known. I urge the Government to consider this point. I challenge any economist to say that this would not be reproductive expenditure, and I ask the Government to use their influence to get industries to make use of it; and to encourage provision to be made for them.

Let me say one word on the international aspect of this problem. The Government and the Bank of England have done their duty in providing us with cheap money. It is cheap and plentiful now; and there are few people who would want the provision of additional money to go further in this country until we can get international action and provide an equally ample supply in the United States. Let me refer to two other points. One is the Debt question Repudiation is an unpleasant thing for this country at any time, but I think that we are entitled to ask that the American Debt which was calculated in all stress and necessities of that time, when America had the right to call upon us to repay at once, should now be recalculated on a different basis. We should ask them to give us the real cost to them of the materials they supplied, without the profit that was made and the taxes received by the American Government out of it. Further, the services that we provided by our own destroyers in bringing the materials here, sometimes at the cost of the loss of our own vessels, might equitably be taken into account in a recalculation of the amount of the debt which was properly owed.

The other point is this. It is true that the obstacles to trade are strangling a resumption of prosperity in the world. I have always been a tariff reformer, and I think it was quite right to put on the Import Duties. No Government can afford to be free importing in a time of slump like this, when all the surplus production of the world is poured into the one free place. At the same time that position is perfectly compatible with what so many of us who are tariff reformers have said in the past, namely, that if other countries would reduce their tariffs we would be willing to reduce ours. The right hon. Member for Carnarvon Boroughs (Mr. Lloyd George) said yesterday that the Ottawa Agreements prevented us taking up that attitude now. I have not been able, no one individual has been able to recalculate all the specific dates in percentages of values, but in so far as we are not permitted to take up that attitude the exceptions are comparatively minor ones. As an old tariff reformer I say to the Government, "Act up to the old profession that so many of us tariff reformers have held and say, 'If you wish to tax us highly, in defence we have to tax your goods. If you are willing to come down and make a low tariff group, then we are willing to try to meet you.'"

I have always thought that the second year of this Government would be far more difficult than the first. As to the future I am a good deal more sanguine than many, and possibly more sanguine than the Chancellor of the Exchequer. When this trouble lifts, I think the recovery ought to be much quicker than is often anticipated. We had in 1920 similar language to that of the technocrats, yet from 1924 to 1929 we saw not only the value but the volume of international trade growing, and each year surpassing what it was in the years before, and what it was before the War. It was only we in this country who did not take advantage of it, through out own fault. If the trouble lifts again, and we are prepared for it, I believe we can, in the words of one of the leading American consulting engineers when be spoke of this country, quickly regain and maintain the whole of our old commercial prosperity and position.

9.48 p.m.


I would like, first of all, to say from these benches how much we welcome the maiden speech of the hon. Member for Cardigan (Mr. D. Evans). Something has been said about the form of this Motion. The hon. Member for Stockton-on-Tees (Mr. Macmillan) suggested that the words relating to "restriction of the flow of trade" had been put in to angle for the Liberal vote, but after the speech of the Chancellor of the Exchequer and the speech of the right hon. Member for Tamworth (Sir A. Steel-Maitland) he will realise that we were, as a matter of fact, not only angling for but obtaining the support of two eminent Conservatives against the policy of piling up tariff barriers. The other objection came from the right hon. Member for Darwen (Sir H. Samuel). He complained of his Amendment not being called, and objected to our Motion because he said he could support neither the Motion nor the Government. I should have thought that we had consulted the right hon. Gentleman's convenience, for he is put in exactly the position he generally occupies, being, in the words of Dante, neither for God nor his enemies.

During the last two days we have had the Government case on unemployment put by the Minister of Health and the Chancellor of the Exchequer. Everyone will agree that those two right hon. Gentlemen are extremely lucid speakers. In fact their lucidity is apt to cover a certain lack of content. But the memorable thing to me about their lucidity is that it has revealed the nakedness of the land as far as Government policy is concerned—nakedness which was more or less hidden by the cloudy 'rhetoric of the Prime Minister. Both of those right hon. Gentlemen dealt at length with what is sometimes called the policy of relief works. The Chancellor of the Exchequer took quite a long time fighting against an entirely imaginary proposition. He suggested that someone was putting forward relief works as a cure for unemployment. That has never been our contention from these benches. It was never our contention when we were a Government.

I was rather surprised that the Prime Minister did not get up and correct the Chancellor of the Exchequer. The Prime Minister knows perfectly well that it was never suggested that work of this kind was anything more than a palliation of unemployment, and he knows quite well that while he was Prime Minister suggestions of every kind were made to him, without much affect I admit, with regard to dealing with the reconstruction of industry. In fact the particular suggestion that has been put forward so eloquently by the right hon. Member for Tamworth was put to the Prime Minister as one of the things most necessary, that is to say, the placing of cheap money at the disposal of industry for reconstruction, in view of possible future developments. But unfortunately that suggestion was not adopted. The Prime Minister has said that it is not unwise to put people to work if unemployment is temporary, but apparently it is wrong to put them to work if unemployment is permanent. What does he really mean to do about these 2,000,000 people who, he told us, would not, even if the Government were most successful in all their policy, be put back into industry? We learn now from his Bethnal Green letter that it is uneconomic to set them to work.


To set them to relief work.


The Prime Minister knows that he is playing with words.


The letter sent to me by the Borough of Bethnal Green asked the Government for help for relief work.


Yes, and the Prime Minister in his reply to that letter, although he used the term "relief work" proceeded to give a list of every kind of work put in hand by the Labour Government, including roads and housing and everything else, which he now calls relief works. He argued the whole question about what he now calls relief works, and he said: They vigorously pressed forward a policy in putting in hand work of an estimated value of £192.000,000. Now he is going to suggest that that is relief work in the narrow meaning of the term. He knows the figures perfectly well; he has heard then often. They were given again by the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George). They include road schemes, housing schemes and everything of that sort. I say again that the Prime Minister is playing with words. He suggests that any way relief works are no good for these 2,000,000 people. What is his policy with regard to this hard core of unemployment, these 2,000,000 people who, he told us only a month or two ago, could not in any case be absorbed in industry? Presumably they are going to be kept alive? Apparently they are now going to be treated to charity. It is a terrible prospect. He tells us that it is more economical to keep people idle than to put them to work. There is where I find the greatest cause for disturbance in reading the letter of the Prime Minister and hearing the speeches of the Minister of Health and the Chancellor of the Exchequer. I find such extremely curious economics in them. Let me take for a moment the Minister of Health on wise spending. We have come down now to wise spending. There was to be no spending at all when the Government first came in but now there has been a hurried change over to what they call "wise spending" and what does that mean? Here is the Minister of Health: Another example of the proper application of the word 'urgency' in the case of the authorisation of loans is found in the interests of the numerous seaside towns and other popular resorts. Attention must always be paid to the business of the town."—[OFFICIALREPORT, 15th February, 1933, col. 1062, Vol. 274.] On the other hand he says that there should be "anxious consideration" before local authorities bring forward gas or electricity undertakings, because they may not turn out to be remunerative. Look at what that means. It means that it is a perfectly economic thing for the town council of Blackpool or Southport to put in a bath, but that it is uneconomic for Blackburn or Southwark to do so. It is a luxury if you put it into a town where the people are huddled together, but if you put it into a seaside resort it is all right. You must not light the streets of an industrial town with electricity because you would lose money on it, but it is all right to illuminate the parade at a watering place. I think that is a terrible revelation of what I may call the finance mind. The right hon. Gentleman's whole mind is turned on the question of profit and he does not seem to have the slightest conception that there can be anything for the benefit of the community unless someone is making a private profit.

Let me take another remarkable example. As I come to the House I pass a number of shops which display yellow labels calling on people to "spend for prosperity." I am invited to go in and buy boots or a hat or a coat which I may not want because it is good for trade. On the other hand, if I and a number of other people pay our rates and taxes and out of that payment propose to provide a hat or a pair of boots for a man who has none at all, that is waste. Again it is wasteful to build houses or to make public gardens for people who have not any. We must not, for instance, build a house for John Smith or provide him with a garden, but it is a valuable assistance to the nation if the Hon. John Fitzsmythe employs somebody to paint and decorate his mansion or put down a crazy pavement path in his garden. I do not understand that kind of economics, but that is what is being put up to us to-day. It was put up to us again by the hon. Member for Harrow (Sir I. Salmon), who said that it was all right to put up public offices and Employment Exchanges though apparently it is not all right to put up houses. I think we ought to try and get these things a little clearer in our mind.


Hear, hear!


I am glad to hear that expression of approval. It seems that the points which I have been making have got home. The real point with regard to spending by various persons is a matter of the direction of the spending and not of the amount. The suggestion that if a number of people individually spend their money on something, and if precisely the same things are bought collectively, there is a difference in advantage to the nation is absurd. The suggestion that there is something different in the way of providing employment between spending money out of the pockets of individuals and spending it collectively—that there is something quite different in the economic activity of the nation as between these two methods—is absurd. I think a great deal of the trouble with regard to the Government's policy is that they have never thought out these matters.

When we come to consider the speech of the Chancellor of the Exchequer we find that he mentioned four great remedies, the first of which was the restoration of confidence. Fortunately we had a translation of the word "confidence" as used in this connection from the right hon. Gentleman the Member for Darwen, who translated it as implying a profit for somebody. Apparently a return of confidence means the making of profits and that is why I was surprised to hear that there was confidence in the present Government. We had a list given to us of the enormous sums piled up in the banks simply because in such a period of confidence no one thought that they could make a profit. The second remedy of the Chancellor of the Exchequer was the raising of the level of wholesale prices. I believe that a raising of prices is one way of redressing the balance between the producer and the rentier, but to think that by raising prices you can produce trade seems absurd. Unless you are going to raise wages at the same time, what on earth is the good of raising wholesale prices? What is the good of doing so if at the same time you are bringing down the effective purchasing power of the masses of the people?

Another thing which gave me a shock was the triumphant declaration of the Chancellor of the Exchequer of his one great success in raising prices. He said that this country was the sole market for surplus meat and that we had managed to get the wholesale price raised against us. That struck me as a most remarkable triumph and I should like him to take the views of any business man about it. Then we come to international trade. I think the right hon. Gentleman the Member for Tamworth was quite right in his insistence on the importance of international trade but let us hear what the Minister of Health, who is a great financial authority, has to say on international trade. He said: Look abroad, see what has been happening in other countries …. and you will see there such a state of affairs as to satisfy you that something has already been achieved in the way of the protection of our people from these evils ….here, unemployment is worse than here."—[OFFICIAL REPORT, 15th February, 1933; col. 1055, Vol. 274.] Why not carry it a little further and cheer up the unemployed of Yorkshire by telling them that the people of Durham are worse off? It is as if the baker said, "Thank God the butcher and the candlestick maker are worse off than I am. They cannot buy my wares and I am just able to keep going." The right hon. Gentleman the Chancellor of the Exchequer gave some very interesting comparisons for which I thank him. He said the present situation was as though a number of logs were going down a river with the current. You have not only to see how quickly they pass the bank; you have to see the relative position of the logs. It was an apt description of the nations of the world, blindly going down the current, not under any intelligent guidance, but bumping and jostling each other, each eager to see whether any one was going down the current a little quicker than the others. They do not look at the bank to see how fast the whole lot are going down, though the roar of the rapids sounds louder and louder all the time.

When one looks at the condition of the country the amazing thing about this Government is that they never in any respect live up to the name "National." They can never conceive of national wealth or of the nation as a business entity. That is why we have this failure to understand what putting people into work means. The Government are afraid that if they put people into work somehow or other they will not be able to balance their Budget. We all know that the unemployed have to be kept alive out of the means of the rest of the people of this country, and, except for what tribute may come from abroad, that depends on the services and the products of this country. That is what you have all got to live on. We may have different shares, but in the ultimate we have all got to live out of that one source of wealth. But the Government say that if you take 3,000,000 people and set them at work to 'add to that source of wealth, it is extravagance, and that it is cheaper not to let them work at all. I cannot understand that, especially from the Prime Minister.

One hon. Member went off on a very curious point about the production of goods of consumption and capital goods, but I hope he will work that out on paper and not merely for one year only. He gave us a little sum, but if he will carry it on year by year I think he will find that that is the point where he went wrong. The actual point of the condition of the world and of this country to-day is the question of purchasing power, the amount of purchasing power and its distribution. When I listened to the right hon. Member for Tamworth, whose optimism, if qualified, was not nearly so qualified as that of the Chancellor of the Exchequer, and his hopes for trade recovery, I wanted to know where it was coming from. I understand that we can produce any amount of goods in this country and in other countries, but everyone is saying that there is nobody to buy them. The great change that has taken place is the enormous mass production of goods, and you cannot get those goods unless you have a very widely distributed and high purchasing power. The breakdown of capitalism, as I think the Noble Lord the Member for Hastings (Lord E. Percy) said the other day, was that you had no way whatever of getting your purchasing power raised except through the wage system, which is an ineffective way.

That is the problem facing this Government, and that is the real problem with regard to unemployment. I quite agree with the right hon. Member for Tamworth that you cannot view the whole matter if you consider merely this country, but, after all, this Government has chosen economic nationalism as its goal. It may be a slightly larger nationalism, within our Empire, but why, when they have done that, do they not take up the corollary of high production, namely, high purchasing power? The real trouble is that most of the members of the Ministry, with perhaps one exception, have minds that were formed in the days of scarcity, and they cannot understand the economics of abundance. Unless we get a change in that respect— and I think it would be a very good thing to sweep away the whole of the senior members of the Government—I do not see the slightest chance of doing anything.

We on this side have put forward a claim, not for relief works, not for dealing merely with a number of small plans, but for the National Government really to take in hand the reconstruction and development of this country. We are told that we have done with laisser faire. That is an excellent thing, although the manifestations of its abolition may not always be agreeable to all of us, but we have done with a good many other things also. We have done largely with the sacredness of contract, and that was done when the first National Government came in. We are not now so everlastingly bound to that idea that you are always tied down by the financial arrangements of the past. Indeed, I understand that we are going to America to beg them to excuse our debt.

Again, in regard to the law of property, we had an admirable principle supplied the other day by the Colonial Secretary, what we may call the Kenya principle, and that was how the right of property in land must give way to the public advantage. It was said, "We could not be held up in this way; it was very awkward, but what we intended to do with the native of that country who stood in the way of development was to take away part of his land, give him compensation, and settle him among his neighbours."

If we want to put in hand what the right hon. Member for Carnarvon Boroughs has so often advocated, a real land settlement campaign, the Colonial Secretary has given us a splendid lead. We can start by taking his land, and he can settle among his neighbours. There is another advantageous principle, and that is the principle of compensation. We are told, We should, of course, give compensation, not a lump sum, but paid out in instalments, a very reasonable and practical thing to do. I agree. The Colonial Secretary in another sphere has laid down principles which, adopted in this country, might enable us to make a real beginning with land settlement. Then there is the whole question of the development of this country, and that is what it is so difficult to get the Prime Minister to look at all. The Prime Minister is a great man for broad statements and for tiny details, but he never seems to see anything of the intermediate part of the landscape. He talks on the general question of the depressed areas, but when you come to the actual problem of those depressed areas, absolutely nothing effective has been done yet. There is your hard core of unemployment. On the Prime Minister's own showing, whatever may happen with regard to trade and to industry, you are going to be left with that hard core. But it cannot be left like that without doing infinite damage to this country, and I cannot see why the Government should not take active steps and get someone to deal with the matter in a really comprehensive and planning way.

Our suggestion is that this Government, if it is a National Government, should take in hand the whole organisation of the economic life of this country, but there we come to the blessed word "planning." Planning is all very well, but you must plan what kind of society you want. We believe in planning for an equalitarian society, and I think the whole trend of industrial development will render it necessary to have a far more equalitarian society. Unfortunately, this is the most class Government we have ever had in this country. Apart from all the cruelties of the means test, the worst thing in it is its implication. The implication is, as Disraeli says, that there are two nations. Those in one nation are entitled to the best; and those in the other, before they are entitled to anything from the common store beyond the bare necessities, must keep their brothers, sons, fathers and the rest of them. The effect of that is to lower the workers to one dead level. That, I believe, to be thoroughly false from the economic point of view. The Government are going clean against the economics of an age of abundance.

With regard to the suggestion that all we can do is to keep pegging away, the right hon. Gentleman the Member for Carnarvon Boroughs said that the workers were quiet at present. The Government will be very unwise if they presume that that quiet is going on all the time, year after year. We are an extraordinarily enduring race. [Laughter.] I do not see anything to laugh at. I thought that Members in all parts of the House had paid their tribute to the uncomplaining heroism of the people in these times and to the patience with which their hardships are being borne. There must come a breaking time, however. You may say that the people of this country bear their burdens better than others. You can find an example in the War. We had the long agony of Passchendaele in which the men suffered terrible losses, going on and on, although they must have been convinced that the whole plan was bad and success impossible. There were similar incidents in other nations in which the people broke. I think that our people would have broken if Passchendaele had not been broken off after a time. I do not think that you can keep people enduring these hardships without some hope. One of the reasons for continuing works of various sorts, even though they put only 100,000 men in work, was that it meant that someone was working and that there was some hope. But when you have a hopeless declaration by Minister after Minister of the Crown, and expect people to keep on quietly enduring, you are asking too much of them.

10.19 p.m.


The time has come for winding up what has been a most interesting and useful Debate. We have had a variety of speeches ranging from the speech, which really started this Debate yesterday afternoon, by the right hon. Member for Carnarvon Boroughs (Mr. Lloyd George)—rather miscellaneous and reminiscent of his own endeavours to be an international negotiator, developing and wandering along until he came to the production of what seemed to me to be a series of notes upon telephone development which he had taken out by mistake from notes which be had kept of a ten years' old speech. Then we had such a very interesting and valuable contribution to the present situation as that made by' my hon. Friend the Member for Stockton-on-Tees (Mr. Macmillan).

It is impossible to note them all, but I should like to refer to two. One was the very remarkable contribution to our Debate made by the hon. Member who delivered a maiden speech a few hours ago, and the other, also a sort of quasi maiden speech, by the hon. and gallant Member for North-East Bethnal Green (Major Nathan). My hon. Friend who delivered his real maiden speech suggested towards the end that he had various schemes and proposals which he thought would help the nation in its present circumstances. He was invited by the hon. and gallant Member for North-East Bethnal Green to take a further opportunity in this House of developing those schemes. May I make him a better offer? The Government are a National Government. It is not necessary for the hon. Member to wait until he makes another speech in this House. There is now machinery, which has been set up by the Government, under which every practical proposal of a business-like character that can be made is considered—not by Ministers, for whom a Member might not have a great regard, but by a conference of leading business men who are assisting us to find ways of stimulating British trade at the present moment.

I would extend a similar but modified invitation to the hon. and gallant Member for North East Bethnal Green. He has told us he has made his suggestions. Every suggestion made during recent months in Debates upon unemployment such as those which he referred to as being of a character of his own has been tabulated, and it will not be necessary for the hon. and gallant Member even to write out his schemes. I will let him see the list of proposals which have been made, and if he will be good enough to tick off those which are his own I will see that they are specially examined by the conference. Why this Government have given facilities for Debate after Debate upon unemployment is that every Member of this House, irrespective of the party to which he belongs, should make contributions to a problem which has been faced honestly by every party in the House, and which has not reached a situation which does credit to any one of them.


Especially the Prime Minister. [HON. MEMBERS: "Order!" Order be damned!


I must request the hon. Member not to use un-Parliamentary language in an un-Parliamentary interruption.


I will apologise for using un-Parliamentary language. I will only say the Prime Minister induced me to do it.


There have been a number of speeches which were very moving in their description of the existing state of affairs. I hope that no hon. Member, whatever his party, is under the impression that those descriptions have no sounding-board and no resting place in the hearts of every Member in this House. What I want to say to hon. and right hon. Members is that if this House is going to be nothing more than a mere debating society descriptions will not assist us. I wish they knew. How much complacency has there 'been? I wish they only had the imagination which would save them from doing grave injustice. The only conception I have of complacency at the moment is to get up here month after month as Debates arise, make speeches that have been delivered year after year, and make proposals every one of which has been examined, some by Conservatives, some by Liberals, and some by Labour, with the result that you see to-day. That is complacency. The complacency of the man who can simply sit down at his own fireside, or stand and address this House and talk about the pain in the hearts of these people, is colossal. The proof that there is no complacency is the fact that one is prepared to go through dark days in order to try and discover some series of propositions, some systematic treatment of this problem, that will at last enable us to be complacent because we have got beyond it altogether.

I repeat that I hope that hon. Members really mean to face this problem and to help others to face it. Remember that if they have their proposals—the freshness of the hon. Member's speech, the maiden speech, induces me to believe that he has such proposals existing in his head or in his heart—let us have them. I can assure him that they will be examined, and that if there is anything in them it will be brought out. I hope that hon. Members will remember that when my right hon. Friend the Chancellor of the Exchequer gave comparisons between this country and other countries, those comparisons were not made for the purpose that some speakers from the Opposition have imagined. I wish sometimes that they themselves would make comparisons, because only by making comparisons can they estimate what the value of this Government has been. Let us take, for instance, the figure that has been so much heard of in the Debate, and in certain newspapers, of the increase of 180,000 in the January figures of unemployment. There have been three parties here, and two parties have held office and have dealt with unemployment. Did any Member of either of those Governments, because of the terrible pain and burden of the social conditions of to-day, ever have a happy Christmas dinner when he knew that the figures in January were going up? We always knew it. If there is any satisfaction—God knows, it is only a shadow of satisfaction—to be had from these January figures, it is that they do show a relative stopping of the deterioration. In 1929, the January figure—that was before the slump became as bad as it was hastening to become—was 154,000. That was the increase in January of that year, before the slump became grave. In 1930, the increase in January was 188,000. In 1931, the increase was 309,000.


The means test.


In 1932, the increase was 221,000. And I say that, if there is any satisfaction, though it be but a shadow, still the fact that it can be very accurately described in that way makes it absolutely unjustifiable for men who know better to say that the increase of 180,000 is one of the worst increases in the whole time.


It is the high-water mark.


That is all the use that is to be made of comparisons, because, while we are striving to pull things up, and are meeting with a certain amount of success, the first proofs of the success are relative figures, and are not, and cannot be, absolute figures for some little time.

I do not know that I quite understood what was the point of that very delightful and most interesting lecture on academic economics which was delivered before I got up, but I did understand this—it was, no doubt, owing to the hon. Gentleman's rather loose language —that, if 3,000,000 people were put to work, it would be to the benefit of the country. There is no disputing that, provided that the work is economically worth it. If 3,000,000 people are put down, say, to dig coal from the bottom of a pit and accumulate coal at the top, what is the economics of that—of 3,000,000 people put to work on what is called relief work? The hon. Gentleman must not select his own definitions to suit himself and his argument. He was dealing with the Bethnal Green letter, and I am very glad that that has been raised. The Bethnal Green letter was written in reply to a letter sent by the Bethnal Green Borough Council, and that letter is headed in capitals. The subject of the letter is "Unemployment Belief Works." I wish the hon. Gentleman would not be quite so sure of great width of knowledge. Might I tell him that I have the original letter in front of me? The distinction that was implied, especially in the letter sent to me, was that there was nothing except roads and work of that nature which used to be subsidised by the Unemployment Grants Committee.


May I ask the right hon. Gentleman what part of the letter, a copy of which I also have before me, quotes relief work rather than "unemployment relief works"?


I must say my ability is limited to reading ordinary English. [Interruption.] There is no punctuation and the context of the letter shows that there was never meant to be punctuation and, if there had been punctuation, it would have been nonsense. There is no doubt at all that the question put, at any rate to me as Prime Minister, amplified by a summary of the reply that had been received by the Minister of Labour and the Minister of Transport, was that what the Bethnal Green Council had in its mind was unemployment relief works. That is why I use the language that I used in my letter. I am very sorry that it took a long time to answer. It came when I was abroad and, before I was 24 hours back in London, I gave instructions that the letter, which had lain too long, should be immediately answered. But that is where the point comes in—3,000,000 people put to employment on work which is non-productive and unnecessary in itself and which has no market, 3,000,000 people living upon income created by the mass of their fellow workers and, that being so, every pound spent uneconomically may appear to a small number to be income but, as a matter of fact, it is income derived from capital and the moment you begin, like unjust stewards, to tell the people who are listening to what you say and drinking in expectations, that you are prepared to spend capital uneconomically upon them, you are deluding them, and they are far greater victims of your suggestions than they would be victims if every bit of criticism you made upon my two right hon. Friends were true.

That is our case and that is our general position. But the House must remember that the question of unemployment relief by work or anything else is not the whole policy of the Government. The policy of the Government includes the restoration of national and international credit. Again, what Government has done more than this Government has done in both those directions? Lausanne saved Europe from an immediate financial catastrophe. Lausanne stopped the deterioration. If hon. Members had gone abroad and talked to those responsible for the Governments of several countries in Europe they would have found that Lausanne stopped the deterioration which had gone so far that the creaking could almost be heard. The International Economic Conference arose out of Lausanne. The right hon. Gentleman yesterday talked about the time. He forgot the facts. The International Economic Conference was not decided upon until Lausanne was finished at the beginning of July. The House knows that my colleagues and I wanted that Conference to come soon. The calling of that Conference was not in our hands. Lausanne handed that Conference over to Geneva. I am not saying that the League of Nations did not do its work with expedition, but I do say that we—this Government—did everything we possibly could to have the Conference meet before Christmas. When they talk about Lausanne not being ratified, do the right hon. Gentlemen and hon. Gentlemen remember the provisions of the Lausanne Conference? Has the right hon. Gentleman forgotten that before the beginning of July the American Presidential contest was entered upon? But in order to carry out that project would he have asked President Hoover or any American authority during the middle of that contest to discuss Lausanne with him and see how far they could go? There is a time for haste, and there is a time for study and opportunity.


And there is a time for action.


I see that the right hon. Gentleman appreciates my point. Was July, August, September, October time for action with Lausanne and America? He thinks that he is the only impatient man in this House to get things done. I will beat him 50 per cent. any day he likes. Let us go ahead. Let us go on. In November the change of Government came in America. No doubt he has a hawk-like desire for action, without bridle and without saddle, across the Atlantic. It is quite possible in the right hon. Gentleman's dreams that that should happen. He would have arrived at White House or the Secretary of State's office, and he would have said: "Come, you have only got a month or two in office. Let us discuss the War Debts." My right hon. Friend has done many rash things. He raised this subject in the Debate yesterday.


I have spoken twice on Lausanne. Since the right hon. Gentleman puts to me the question of what I would have done in the same circumstances, I certainly would not have discussed the question of international debt until America was in a position to do so. America was not in a position to do so, as I pointed out, until after the settlement of the Presidential election. That was why I thought Lausanne was an absolutely futile proceeding, and I still think so.


Suppose the right hon. Gentleman is right about Lausanne—and he is absolutely wrong—what nature of folly did I commit? The appetite for action. He is in the same boat with me, regarding Lausanne from that point of view. He is in the same boat as us regarding the American negotiations. As a matter of fact, one can say quite discreetly that we got into touch with American potential authority probably before he would have done himself. On the 4th of March we shall be in a better position to go straight into action than anybody would have imagined would have been possible two months ago. The House must remember, first of all, that the work of last year was creating the conditions which would enable us to expand if any proposals for expansion were forthcoming. Just fancy, discussing 12 months ago subjects like some of those raised in some of the best speeches in this House for the expenditure of money, for the expansion of activity, for the finding of capital to be spent as capital and not to be wasted as income. Twelve months ago. Imagine the madness of this House listening to some of the proposals that were made yesterday and to-day, which not only have to be listened to but have to be studied with the most sincere desire to fit them into a policy in a spirit of expansiveness, always limited as it must be, with a Budget or two to come, and always limited by the considerations adduced in this House by my two right hon. Friends beside me. I feel that my right hon. Friend below the Gangway agrees with me. I sometimes marvel whether opinions depend upon well-thought-out ideas or upon geographical situations.


My right hon. Friend would be an authority on the change of opinion according to geography.


I am an authority but I still stand here. In his speech this afternoon the right hon. Member for Darwen (Sir H. Samuel) ranged over a wide field of Government activity. Who would have thought, with all those vast proposals about reorganising and doing business, that the right hon. Gentleman only left us, to our sorrow, four months ago? My right hon. Friend the Member for Epping (Mr. Churchill), when he was here, had a good deal to say about relief works and the nature generally of the proposals now being made to us. As he himself rather indicated, in the very touching and very eloquent statement he made about conditions of human beings in this country, he must not get away with the idea that it was a contribution or. solution of the problem. When my right hon. Friend made his Budget speech on the 15th April, 1929, things were getting pretty bad. He was then speak- ing as Chancellor of the Exchequer, and, referring to expenditure and unemployment, he said: Nevertheless we have pursued the even tenor of our way— that is his very much improved literary style of saying that we are pegging away— and during the course of the present Parliament we have spent, or caused to be spent, or undertaken to spend in cash or credit over £400,000,000. Then follow one or two sentences, which are not relevant to his argument, and he continues: The point I am coming to is that for the purpose of curing unemployment the results have certainly been disappointing. They are in fact, so meagre as to lend considerable colour to the orthodox Treasury doctrine which has steadfastly held that, whatever might be the political or social advantages, very little additional employment and no permanent additional employment can in fact and as a general rule be created by State borrowing and State expenditure. The passage which follows has, I think, a very close connection with the attitude taken up to-day. He went on to say: Nothing would be more foolish, more wrong, more wanton, than for a stroke"— He was talking about the Boat Race— to make an exhausting spurt, not on any sound calculation of winning the race, but just for the purpose of giving the crowd at Barnes Bridge, under which he was about to pass, something to shout at."—[OFFICIAL REPORT, 15th April, 1929; cols. 54-55, Vol. 227.]


May I remind the right hon. Gentleman that in those days unemployment was 1,000,000, that the rate of money was different from what it is now, and that the Government were spending on a far larger scale.


That may be so. If unemployment was 1,000,000 his problem was much easier than ours, and a very small additional employment would be a big proportion of the problem with which he was confronted. I sympathise with my right hon. Friend and I leave it there. I beg the House to renew its confidence in the Government. Our steady policy may enable the speeches to be made that have been made to-day, full of misrepresentations, full of misunderstandings, full of statements regarding our position which, to put it mildly, are purely imaginary, but I feel certain that everybody looking back on the last 12 months' work and seeing that we have made such Debates as have taken place possible and practical will realise that that in itself is one of the most magnificent achievements to which any Government can lay claim. The House will remember a memorable sentence in a memorable speech made by Pitt in 1805, long before Europe was pacified, and which the right hon. Member for Carnarvon Boroughs, if he had been living at that time, would no doubt have characterised as premature. The sentence was this, and it was true: England has saved herself by her exertions and will yet, as I trust, save Europe by her example. I believe that the work of this Government, first in contracting and then in

careful and scientific expansion, will win for this generation the very high praise that Pitt expressed so truly as the honour and the reward of history.

Question put, That this House deplores the entire failure of the Government to deal with the problem of unemployment and its continuance in a course of policy which, by lowering the purchasing power of the masses and restricting the flow of trade, has resulted in an increase of over 400,000 unemployed in twelve months; and this House calls upon the Government to initiate and carry through a far-reaching plan for the utilisation in the interests of the nation of the national resources in land, credit, materials, and man-power which are now lying idle, so as to increase the total production of wealth in the country.

The House divided: Ayes, 49; Noes, 414.

Division No. 47.] AYES. [11.0 p.m.
Adams, D. M. (Poplar, South) George, Major G. Lloyd (Pembroke) McEntee, Valentine L.
Attlee, Clement Richard Greenwood, Rt. Hon. Arthur Maclean, Neil (Glasgow, Govan)
Banfield, John William Grenfell, David Rees (Glamorgan) Maxton, James
Batey, Joseph Griffiths, T. (Monmouth, Pontypool) Milner, Major James
Bevan, Aneurin (Ebbw Vale) Groves, Thomas E. Nathan, Major H. L.
Brown, C. W. E. (Notts., Mansfield) Hall, F. (York, W.R., Normanton) Parkinson, John Allen
Buchanan, George Hall, George H. (Merthyr Tydvil) Roberts, Aled (Wrexham)
Cape, Thomas Hicks, Ernest George Salter, Dr. Alfred
Cocks, Frederick Seymour Jenkins, Sir William Thorne, William James
Cove, William G. Jones, J. J. (West Ham, Silvertown) Tinker, John Joseph
Cripps, Sir, Stafford Jones, Morgan (Caerphilly) Wallhead, Richard C.
Daggar, George Kirkwood, David Williams, Edward John (Ogmore)
Davies, David L. (Pontypridd) Lansbury, Rt. Hon. George Williams, Dr. John H. (Llanelly)
Davies, Rhys John (Westhoughton) Lawson, John James
Edwards, Charles Leonard, William TELLERS FOR THE AYES.—
Evans, David Owen (Cardigan) Llewellyn-Jones, Frederick Mr. G. Macdonald and Mr. Duncan
Evans, R. T. (Carmarthen) Logan, David Gilbert Graham.
George, Rt. Hon. D. Lloyd (Carn'v'n) Lunn, William
Acland-Troyte, Lieut.-Colonel Bevan, Stuart James (Holborn) Campbell-Johnston, Malcolm
Adams, Samuel Vyvyan T. (Leeds, W.) Birchall, Major Sir John Dearman Caporn, Arthur Cecil
Agnew, Lieut.-Com. P. G. Bird, Ernest Roy (Yorks., Skipton) Carver, Major William H.
Ainsworth, Lieut.-Colonel Charles Bird, Sir Robert B. (Wolverh'pton W.) Cassels, James Dale
Albery, Irving James Blaker, Sir Reginald Castlereagh, Viscount
Allen, Sir J. Sandeman (Liverp'l, W.) Boothby, Robert John Graham Castle Stewart, Earl
Allen, William (Stoke-on-Trent) Borodale, Viscount. Cayzer, Sir Charles (Chester, City)
Amery, Rt. Hon. Leopold C. M. S. Bossom, A. C. Cazalet, Thelma (Islington, E.)
Anstruther-Gray, W. J. Bower, Lieut.-Com. Robert Tatton Cazalet, Capt. V. A. (Chippenham)
Applin, Lieut.-Col. Reginald V. K. Bowyer, Capt. Sir George E. W. Cecil, Rt. Hon. Lord Hugh
Apsley, Lord Boyce, H. Leslie Chamberlain, Rt. Hon. N. (Edgbaston)
Aske, Sir Robert William Braithwaite, J. G. (Hillsborough) Chapman, Col. R.(Houghton-le-Spring)
Astbury, Lieut.-Com. Frederick Wolfe Brass, Captain Sir William Chapman, Sir Samuel (Edinburgh, S.)
Astor, Viscountess (Plymouth, Sutton) Broadbent, Colonel John Chorlton, Alan Ernest Leofric
Atholl, Duchess of Brocklebank, C. E. R. Christie, James Archibald
Atkinson, Cyril Brown, Ernest (Leith) Clayton, Dr. George C.
Baillie, Sir Adrian W. M. Brown, Brig.-Gen. H.C. (Berks., Newb'y) Cobb, Sir Cyril
Baldwin, Rt. Hon. Stanley Browne, Captain A. C. Cochrane, Commander Hon. A. D.
Balfour, Capt. Harold (I. of Thanet) Buchan, John Colfox, Major William Philip
Balniel, Lord Bullock, Captain Malcolm Colman, N. C. D.
Banks, Sir Reginald Mitchell Burghley, Lord Colville, Lieut.-Colonel J.
Barclay-Harvey, C. M. Burgin, Dr. Edward Leslie Conant, R. J. E.
Barrie, Sir Charles Coupar Burnett, John George Cook, Thomas A.
Barton, Capt, Basil Kelsey Burton. Colonel Henry Walter Cooke, Douglas
Beauchamp, Sir Brograve Campbell Butler, Richard Austen Cooper, A. Duff
Beaumont, M. W. (Bucks., Aylesbury) Butt, Sir Alfred Courthope, Colonel Sir George L.
Beaumont, Hon. R. E. B. (Portsm'th, C.) Cadogan, Hon. Edward Craddock, Sir Reginald Henry
Belt, Sir Alfred L. Calne, G. R. Hall- Cranborne, Viscount
Benn, Sir Arthur Shirley Campbell, Edward Taswell (Bromley) Croft, Brigadier-General Sir H.
Betterton, Rt. Hon. Sir Henry B. Campbell, Vice-Admiral G. (Burnley) Crooke, J. Smedley
Crookshank, Capt. H. C. (Gainsb'ro) Heilgers, Captain F. F. A. Molson, A. Hugh Elsdale
Croom-Johnson, R. P. Henderson, Sir Vivian L. (Chelmsford) Monsell, Rt. Hon. Sir B. Eyres
Cross, R. H. Heneage, Lieut.-Colonel Arthur P. Moore, Lt.-Col. Thomas C. R. (Ayr)
Crossley, A. C. Hepworth, Joseph Moore-Brabazon, Lieut.-Col. J. T. C.
Cruddas, Lieut.-Colonel Bernard Hills, Major Rt. Hon. John Waller Morgan, Robert H.
Culverwell, Cyril Tom Hoare, Lt.-Col. Rt. Hon. Sir S. J. G Morris, John Patrick (Salford, N.)
Dalkeith, Earl of Hopkinson, Austin Morris, Owen Temple (Cardiff, E.)
Davidson, Rt. Hon. J. C. C. Hore-Belisha, Lesile Morris-Jones, Dr. J. H. (Denbigh)
Davies, Edward C. (Montgomery) Hornby, Frank Morrison, William Shepherd
Davies, Maj. Geo. F. (Somerset, Yeovil) Horobin, Ian M. Moss, Captain H. J.
Davison, Sir William Henry Howard, Tom Forrest Muirhead, Major A. J.
Dawson, Sir Philip Hudson, Capt. A. U. M. (Hackney, N.) Munro, Patrick
Denville, Alfred Hudson, Robert Spear (Southport) Nail-Cain, Hon. Ronald
Despencer-Robertson, Major J. A. F. Hume, Sir George Hopwood Nation, Brigadier-General J. J. H,
Dickie, John p. Hunter, Dr. Joseph (Dumfries) Newton, Sir Douglas George C.
Dixey, Arthur C. N. Hunter, Capt. M. J. (Brigg) Nicholson, Godfrey (Morpeth)
Dixon, Rt. Hon. Herbert Hurd, Sir Percy Normand, Wilfrid Guild
Donner, P. W. Hurst, Sir Gerald B. North, Captain Edward T.
Dower, Captain A. V. G. Hutchison, W. D. (Essex, Romf'd) Nunn, William
Drewe, Cedric Inskip, Rt. Hon. Sir Thomas W. H. O'Connor, Terence James
Duckworth, George A. V. Iveagh, Countess of O'Donovan, Dr. William James
Dugdale, Captain Thomas Lionel Jackson, Sir Henry (Wandsworth, C.) Oman, Sir Charles William C.
Duncan, James A. L. (Kensington, N.) James, Wing-Com. A. W. H. Ormsby-Gore, Rt. Hon. William G.A.
Dunglass, Lord Jamleson, Douglas Patrick, Colin M.
Eales, John Frederick Jennings, Roland Peake, Captain Osbert
Eastwood, John Francis Joel, Dudley J. Barnato Pearson, William G.
Edge, Sir William Johnston, J. W. (Clackmannan) Peat, Charles U.
Edmondson, Major A. J. Jones, Sir G. W. H. (Stoke New'gton) Penny, Sir George
Elliot, Major Rt. Hon. Walter E. Jones, Lewis (Swansea, West) Percy, Lord Eustace
Ellis, Sir R. Geoffrey Ker, J. Campbell Perkins, Walter R. D.
Elliston, Captain George Sampson Kerr, Lieut.-Col. Charles (Montrose) Peters, Dr. Sidney John
Elmley, Viscount Kerr, Hamilton W. Petherick, M.
Emmott, Charles E. G. C. Kirkpatrick, William M. Peto, Sir Basil E. (Devon, Barnstaple)
Emrys Evans, P. V. Knight. Holford Peto, Geoffrey K. (W'verh"pt'n, Bilston)
Entwistle, Cyril Fullard Knox, Sir Alfred Pickford, Hon. Mary Ada
Erskine, Lord (Weston-super-Mare) Lambert, Rt. Hon. George Potter, John
Evans, Capt. Arthur (Cardiff, S.) Latham, Sir Herbert Paul Powell, Lieut.-Col. Evelyn G. H.
Everard, w. Lindsay Law, Sir Alfred Power, Sir John Cecil
Falle Sir Bertram G. Leckie, J. A. Pownall, Sir Assheton
Fermoy, Lord Lees-Jones, John Procter, Major Henry Adam
Fielden, Edward Brocklehurst Leighton, Major B. E. P. Purbrick, R.
Fleming, Edward Lascelles Lennox-Boyd. A, T. Pybus, Percy John
Flint, Abraham John Levy, Thomas Raikes, Henry V. A. M.
Fox, Sir Gifford Lewis, Oswald Ramsay, Capt. A. H. M. (Midlothian)
Fremantle, Sir Francis Liddall, Walter S. Ramsay, T. B. W. (Western Isles)
Fuller, Captain A. G. Lindsay, Noel Ker Ramsbotham, Herwald
Galbraith, James Francis Wallace Lister, Rt. Hon. Sir Philip Cunliffe- Ramsden, Sir Eugene
Ganzoni, Sir John Little, Graham-, Sir Ernest Rankin, Robert
Gault, Lieut.-Col. A. Hamilton Llewellin, Major John J. Ratcliffe, Arthur
Gibson, Charles Granville Lloyd, Geoffrey Rawson, Sir Cooper
Gillett, Sir George Masterman Locker-Lampson, Rt. Hn. G. (Wd.Gr'n) Ray, Sir William
Gilmour, Lt.-Col. Rt. Hon. Sir John Locker-Lampson, Com. O. (H'ndsw'th) Reed, Arthur C. (Exeter)
Gledhill, Gilbert Lockwood, Capt. J. H. (Shipley) Reid, Capt. A. Cunningham-
Glossop, C. W. H. Lockwood, John C. (Hackney, C.) Reid, James S. C. (Stirling)
Gluckstein, Louis Halle Loder, Captain J. de Vera Reid, William Allan (Derby)
Glyn, Major Ralph G. C. Lymington, Viscount Remer, John R.
Golf, Sir Park Lyons, Abraham Montagu Rentoul Sir Gervals S.
Goldie, Noel B. Mabane, William Renwick, Major Gustav A.
Goodman, Colonel Albert W. MacAndrew, Lieut.-Col. C. G. (Partick) Rhys. Hon. Charles Arthur U.
Graham, Sir F. Fergus (C'mb'rl'd, N.) MacAndrew, Capt. J. O. (Ayr) Roberts, Sir Samuel (Ecclesall)
Granville, Edgar McConnell, Sir Joseph Robinson, John Roland
Grattan-Doyle, Sir Nicholas McCorquodale, M. S. Ropner, Colonel L.
Graves, Marjorie MacDonald, Rt. Hon. J. R. (Seaham) Rosbotham, Sir Samuel
Greaves-Lord, Sir Walter MacDonald, Malcolm (Bassetlaw) Ross, Ronald D.
Gretton, Colonel Rt. Hon. John Macdonald, Sir Murdoch (Inverness) Ross Taylor, Walter (Woodbridge)
Grimston, R. V. Macdonald, Capt. P. D. (I. of W.) Ruggles-Brise, Colonel E. A.
Gritten, W. G. Howard McEwen, Captain J. H. F. Runge, Norah Cecil
Guinness, Thomas L. E. B. McKie, John Hamilton Russell, Albert (Kirkcaldy)
Gunston, Captain D, W. McLean, Major Sir Alan Russell, Alexander West (Tynemouth)
Guy, J. C. Morrison McLean, Dr. W. H. (Tradeston) Russell, Hamer Field (Sheffield, B'tside)
Hacking, Rt. Hon. Douglas H. Macmillan, Maurice Harold Russell, Richard John (Eddisbury)
Hales, Harold K. Magnay, Thomas Rutherford, Sir John Hugo (Liverp'l)
Hall, Capt. W, D'Arcy (Brecon) Maitland, Adam Rutherford, John (Edmonton)
Hamilton, Sir George (Ilford) Makins, Brigadier-General Ernest Salmon, Sir Isidore
Hammersley, Samuel S. Manningham-Buller, Lt.-Col. Sir M. Salt, Edward W.
Hanbury, Cecil Marsden, Commander Arthur Samuel, Sir Arthur Michael (F'nham)
Hanley, Dennis A. Martin, Thomas B. Sandeman, Sir A. N. Stewart
Hannon, Patrick Joseph Henry Mason, Col. Glyn K. (Croydon, N.) Sanderson, Sir Frank Barnard
Harbord, Arthur Mayhew, Lieut.-Colonel John Savery, Samuel Servington
Hartington, Marquess of Merriman, Sir F. Boyd Selley, Harry R.
Hartland, George A. Mills, Major J. D. (New Forest) Shakespeare, Geoffrey H.
Harvey, George (Lambeth, Kenn'gt'n) Milne, Charles Shaw, Helen B. (Lanark, Bothwell)
Harvey, Major S. E. (Devon, Totnes) Mitchell, Harold P.(Br'tf'd & Chisw'k) Shaw, Captain William T. (Forfar)
Haslam, Sir John (Bolton) Mitchell, Sir W. Lane (Streatham) Shepperson, Sir Ernest W.
Headlam, Lieut.-Col. Cuthbert M. Mitcheson, G. G. Shute, Colonel J. J.
Simmonds, Oliver Edwin Strauss, Edward A. Warrender, Sir Victor A. G.
Simon, Rt. Hon. Sir John Strickland, Captain W. F. Waterhouse, Captain Charles
Sinclair, Col. T.(Queen's Unv., Belfast) Stuart. Hon. J. (Moray and Nairn) Watt, Captain George Steven H.
Skelton, Archibald Noel Stuart, Lord C. Crichton- Wayland, Sir William A.
Slater, John Sueter, Rear-Admiral Murray F. Wedderburn, Henry James Scrymgeour-
Smith, Bracewell (Dulwich) Sugden. Sir Wilfrid Hart Wells, Sydney Richard
Smith, Sir Jonah W. (Barrow-In-F.) Summersby, Charles H. Weymouth, Viscount
Smith, Louie W. (Sheffield, Hallam) Sutcliffe, Harold Whiteside, Borras Noel H.
Smith-Carington, Neville W. Templeton, William P. Williams, Charles (Devon, Torquay)
Smithers, Waldron Thomas, James P. L. (Hereford) Williams, Herbert G. (Croydon, S.)
Somervell, Donald Bradley Thompson, Luke Wills, Wilfrid D.
Somerville, Annesley A. (Windsor) Thomson, Sir Frederick Charles Wilson, Clyde T. (West Toxteth)
Somerville, D. G. (Willesden, East) Thorp, Linton Theodore Wilson, G. H. A. (Cambridge U.)
Soper, Richard Titchfield, Major the Marquess of Windsor-Clive, Lieut.-Colonel George
Southby, Commander Archibald R. J. Touche, Gordon Cosmo Winterton, Rt. Hon. Earl
Spears, Brigadier-General Edward L. Train, John Wise, Alfred R.
Spencer, Captain Richard A. Tryon, Rt. Hon. George Clement Wolmer, Rt. Hon. Viscount
Stanley, Lord (Lancaster, Fylde) Turton, Robert Hugh Womersley, Walter James
Steel-Maitland, Rt. Hon. Sir Arthur Vaughan-Morgan, Sir Kenyon Wood, Rt. Hon. Sir H. Kingsley
Stevenson, James Wallace, John (Dunfermline) Worthington, Dr. John V.
Stewart, J. H. (Fife, E.) Ward, Lt.-Col. Sir A. L. (Hull) Young, Rt. Hon. Sir Hilton (S'v'noaks)
Stewart, William J. (Belfast, S.) Ward, Irene Mary Bewick (Wallsend)
Stones, James Ward, Sarah Adelaide (Cannock) TELLERS FOR THE NOES.—
Stourton, Hon. John J. Wardlaw-Milne, Sir John S. Captain Rt. Hon. H. D. R. Margesson and Mr. Blindell.

Question, "That this be the Schedule to the Bill," put, and agreed to.