HC Deb 20 June 1933 vol 279 cc705-16

6.37 p.m.

Mr. ATTLEE

I beg to move to leave out the Clause.

Before we leave the Post Office Clauses, I should like to submit one or two points to the Postmaster-General. At an earlier stage we welcomed this Clause as the first instalment of a reform which has been long overdue, but we think that there is a great danger of the fixed contribution being found to be too high. The second point is that this is only an experiment for three years. The essential point about a reform in the financial position of the Post Office is that there should be finality, and until we get a final settlement between the Exchequer and the Post Office we shall not see that full development for which we all hope. We cannot expect the results which the Bridgeman Committee anticipated from this reform as long as it is merely temporary.

Let me put one or two specific points to the Postmaster-General. The first is with regard to Sub-section (4). The Post Office Fund may be used for the development of postal telegraphs and telephones, and sometimes as appropriations-in-aid of moneys provided by Parliament for salaries and expenses of the Post Office. I should like to ask whether it cannot be used for the benefit of depositors in the Post Office Savings Bank. At the present time these depositors are taxed, one cannot say exactly the sum, because part of the sum handed over is paid for services rendered, but we may reckon that something like £2,000,000 is taken from the large number of small depositors in the Post Office. There is a case for redressing the grievance of the small depositors. It is not only one of justice, but of expediency, because there is no doubt that some of the other banks are cutting into the Post Office Savings Bank to a certain extent, and Post Office savings are a useful sum from the point of view of those who manage the National Debt. It is to their interests to keep the conditions as good as possible for the small investor. I should like to know whether, under the scheme, the surplus can be used for the benefit of the Post Office Savings Bank.

I am going again to make the point that the conditions of the staff should be amended out of the extra amount which is to be allowed to the Post Office. The Postmaster-General has pointed out that Post Office wages are dependent on various agreements made by the Whitley Council and so forth, but he will be the first to recognise that there is a strong case for the lower-paid postal servants and also for some temporary servants. Further, I hope that in the new circumstances the kind of parallel which is drawn between Post Office servants and workers in other Government Departments will not be drawn quite so strictly. They are not in all cases applicable. While I agree that the wages of civil servants should not depend on the profits made by the Department, on the other hand, the conditions of service in the Post Office cannot really be said to be equal to those of civil servants in other Departments, and I put in a plea also for staff amenities.

The next point is with regard to Subsection (7). On the Committee stage we had considerable discussions as to the importance of this House keeping control. The hon. Member for Farnham (Sir A. M. Samuel) was eloquent on the point. In setting up any fund of this kind, it is the duty of the House to see that it is properly safeguarded. The National Government are, or were, very anxious about the proper safeguarding of the sums paid by small depositors into the Savings Bank, although we have heard nothing since the General Election, but we know that the people were then told that these investments were in danger—

Mr. SLATER

They were.

Mr. ATTLEE

The hon. Member will no doubt support me in asking the Postmaster-General whether there is any danger in handing over the funds of the Savings Bank to a body presided over by the Chancellor of the Exchequer? Is it right that the money in the Post Office Fund should be handed over to the very people who are not trusted by the hon. Member below the Gangway? And there is this further point. I understood that the Chancellor of the Exchequer of that day was a purist in financial matters and a strong anti-gambler, whereas the present Chancellor of the Exchequer is now engaged in the very delicate and difficult matter of gambling in the exchanges. I do not know how far the sums handed over to the National Debt Commissioners from the Savings Bank funds are or may be utilised in that way, but it would be awkward if the Postmaster-General, having handed over a considerable sum to the custody of the National Debt Commissioners, found when he wanted that money that they had lost it in a gamble on the franc, or on the rupee or any of the other exchanges.

I am a child in these matters, but we have had the privilege in this House of hearing expert advice on this matter from one who appears to treat millions as we, would treat sixpences, namely, the hon. Member for Putney (Mr. S. Samuel). He said that there were a few small gamblers in exchanges to the extent of £4,000,000 or £5,000,000 or so, and he spoke in this connection about a little paltry sum of £150,000,000. But I gathered that he was rather disturbed about the Exchange Equalisation Fund, and I think it was he who suggested that in these exchange operations you can show a profit all the time on paper, but if ever a time comes when you have to unload, you may find yourself in difficulty. The Postmaster-General is the trustee of these Post Office Savings Bank funds, although he has to submit to Exchequer control, and I am sure the House would like an assurance from him that the new fund which is to be put, to some extent, in the hands of the Postmaster-General outside the usual financial control, will be very carefully invested.

I do not want to go into the question of Treasury control again. We had some cheering words on that subject from the Postmaster-General during our last discussion. He said he had come to a satisfactory agreement with the Treasury for the relinquishment of the meticulous, annoying, and rather futile control which had obtained, or might have obtained, in the past. I would like the right hon. Gentleman, however, to tell us, in regard to proposals and estimates submitted to the Treasury, which have to be approved by the Treasury, whether the duty of the Treasury will be confined to seeing that the sum which it is proposed to expend does not exceed the amount at the disposal of the Postmaster-General. That is to say, supposing the Postmaster-General puts up proposals for developing the telegraphic or telephonic systems, provided the Treasury are satisfied that he is not exceeding the sum at his disposal, are we to take it that it will not be for the Treasury to interfere in that or in any matter of policy concerning the allocation of this Fund? That is a very important point.

When this subject was previously discussed, the Postmaster-General told us —and other hon. Members spoke to the same effect—that it was very necessary that he should not yield in a rash moment to the people who wanted a penny postage and who would involve him in an annual expenditure of £6,000,000 when he had much less than that sum to play with. On the other hand, suppose that he has, say, £500,000 to play with and he submits estimates to the Treasury covering a certain amount, while the Treasury may say, "We have looked into this proposal and it is not going to cost you more than you have at your disposal," they should not be able to say, "You must not spend on this or that subject because we object." Everything within the sum allowed should be under the Postmaster-General's control. I hope that is what the right hon. Gentleman meant by saying that there was a relaxation of Treasury control, but I should like to be assured on those points.

6.50 p.m.

The POSTMASTER-GENERAL (Sir Kingsley Wood)

I very, gladly reply to the questions put by the hon. Member for Limehouse (Mr. Attlee). He repeated the statement which he made on the last occasion when this subject was discussed that he thought the contribution to be made by the Post Office to the Treasury under the arrangement with the Chancellor of the Exchequer was too high. We can all have our different opinions upon that point, but I think he will agree that in the present circumstances the Treasury have not treated the Post Office so badly. We hope, provided trade conditions are maintained, that there will be a sum of something like £1,000,000 available for the Post Office for the first time in its history, and, frankly, I do not think that in the circumstances of the time the Post Office should hope for much more at present.

Mr. ATTLEE

Surely the right hon. Gentleman does not hope that present trade conditions are going to continue?

Sir K. WOO D

No; what I said was that if the present trade conditions continued, we should have £1,000,000 available. If they considerably improve, that sum would be increased, but I do not want to raise people's hopes too high. At any rate, there is a reasonable prospect of the Post Office receiving about £1,000,000 as a start for the Post Office Fund and I repeat that, in the circumstances of the time that is not an unreasonable bargain to have made. Unlike the hon. Gentleman opposite, the hon. Member for Central Leeds (Mr. Denman) takes the view that the Chancellor of the Exchequer ought not to have done this at the present time and considering these two opposite views, I think that, on the whole, a reasonable arrangement has been made. The hon. Gentleman said he hoped there would be no question about finality in this matter. There obviously is not. In the Clause itself the period fixed for the present arrangement is three years. At the end of that time we shall be able to see how the arrangement has worked, what is the condition of the public funds, and whether or not it will then be possible to make a fresh arrangement. In that, of course, we are following out the recommendations of the committee, and, again, I think that in all the circumstances that is a reasonable arrangement.

The hon. Gentleman also raised the question of the purposes for which the Post Office Fund might be used. I would refer him to the full statement which I made in the last discussion. He put a specific question as to whether any part of the fund would be available for depositors in the Savings Bank. The answer is "No." The interest paid to depositors in the Savings Bank is fixed by law at 2½ per cent. and, as he knows, that is rather a matter for the Treasury. The National Debt Commissioners control the Savings Bank funds and the depositors have to rely upon the Statute which at present makes provision for them. As regards the depositors, the Postmaster-General is really an agent and the investment and custody of the funds and the rate of interest are matters outside his province. That is the short answer to the hon. Gentleman on that point.

He repeated his desire, which I quite understand, that the Post Office Fund should be available for improvements in the conditions of the Post Office staff and he referred to the position with which he had to deal, as I have had to deal with it, in connection with wages in the Post Office service. On that question many inaccurate statements have been made, not by the hon. Gentleman himself, but by other hon. Gentlemen opposite who are not so well aware of the facts of the position in regard to these wages. In a previous discussion an hon. Gentleman opposite said that of the Post Office employes 23,000 received less than 40s. a week and that these were full-time employes and adult men and women. The correct figure is 22,800 and it is made up as follows: boy messengers and girl probationers, 8,900; postmen and male sorting clerks below 21 years of age, 4,500; female telephonists and telegraphists, mostly below 21 years, 6,300; women cleaners, 500; and postmen 21 years and over, 2,600. I only make that statement in order that there shall be no misunderstanding as to the exact position in this respect. The hon. Member for Limehouse knows as I do, and as he has himself explained to the staff, that wages in the Post Office have to follow the ordinary conditions which apply to the Civil Service generally. I can only refer hon. Members to the observation which I made in the last discussion on that subject.

The hon. Gentleman sought rather to widen the scope of this discussion and endeavoured to tempt me to follow him into a consideration of Sub-section (7) and of the question of the safety of the new Post Office Fund. One of the most flattering letters that I received on my appointment as Postmaster-General was from a lady in the provinces who wrote to say that she was delighted at my appointment because she felt much more sure of the safety of her savings. I can only assure the House that that compliment is well merited. At any rate, since my appointment I do not think that any of the funds have been lost, stolen or mislaid, and I can give the hon. Gentleman the fullest assurance as regards this fund and the Post Office Savings Bank funds generally, that there is no safer security in the country.

The last point which the hon. Gentleman raised was that of Treasury control. I fully explained that matter on the last occasion. I cannot confine the control of the Treasury in relation to the fund in the manner indicated by the hon. Gentleman. In fact it was recommended in the report of Lord Bridgeman's committee that the Chancellor of the Exchequer should be consulted by the Postmaster-General of the day. The committee approved of the Government of the day, or, at any rate, the Chancellor of the Exchequer inquiring into the specific application of the fund from time to time. It is true that proposals might be made by the Postmaster-General of the day which would require less than the sum available. It might be argued that the Exchequer therefore had no further interest in the matter, but we have to look not only to the application of the fund on one particular occasion but to the possibility that what is done with the fund on that occasion, may have effects in relation to the fund in the next year, or in the next two or three years. Generally, my answer to the hon. Gentleman is that the Postmaster-General must consult the Chancellor of the Exchequer as to the specific application of the fund. I know that not all of these explanations will be agreed to by the hon. Gentleman, but he will share my hope that this fund will be available to the extent I have indicated, and that it will be used by the Post Office for the benefit of its customers- He and I, while not agreeing upon the amount, will, I think, agree at any rate that its establishment is an important event in Post Office history and something which has been desired both by my predecessors and by myself.

7.0 p.m.

Mr. DENMAN

I should like to raise the points with which my Amendments deal. I am sure we all appreciate very heartily the way in which the Financial Secretary to the Treasury has met us all in argument, and we should like to release him as soon as may be. If he will answer the questions I have to put to him, he will be able to get away to his well-earned rest. Certainly we ought to have some answer from the Treasury to these questions, for they have not yet been answered. It is a very remarkable circumstance that Part IV of the Bill which gives to the Post Office £1,000,000 of the money of the Chancellor of the Exchequer, has never been defended as a financial measure from beginning to end. It was not mentioned in the Budget. When objections were raised on financial grounds in the Committee stage of the Resolution, and on the Committee stage of the Bill, there were answers from the Postmaster-General, but not from the Treasury.

We ought to get an ample reply from the Treasury to the questions of whether we can afford it and, if we can afford it, whether this £1,000,000 should be handed back to the Post Office. There is some score of other ways we could suggest in which it might be applied. To expect the Postmaster-General to answer these questions is like putting up the Home Secretary, who is the State brewer, to defend the remission of the Beer Duty. I am glad that the Financial Secretary is here to defend this grant of £1,000,000. Can we afford it? We know the conditions of the public revenue. It is sin- gularly ill-equipped to hand over £1,000,000 to anybody. The first Amendment I have on the Paper makes one simple financial test. It suggests that this fund shall not come into force until we meet the Sinking Fund or specific Government loans which have to be met out of revenue. Surely that is one of the first conditions of a sound financial situation. We all remember the special circumstances of this Government. We are not meeting the actual Sinking Fund required under the conditions of certain Government loans.

If I remember rightly, the amount required for these Sinking Funds is £7,000,000. That we have to meet by borrowing, thus going back to the system utilised after the Napoleonic wars, which created some ridicule among the economists. We all, of course, recognise that it is a wise provision for this year. To give away £1,000,000 before we meet the statutory sinking funds is, however, premature. That is the first point—can we afford it? As the Financial Secretary has pointed out, it comes not from this year's revenue but next year's. All we know with certainty is that the tax remissions of this year will be more expensive next year to the Treasury. We shall be some £2,000,000 down on tax remissions next year. We shall, therefore, be less able to meet this £1,000,000 in 1934, unless there is a trade revival, or some elasticity of our taxes on which at the present time we have no sound ground for speculation. I suggest that this is the first occasion on which our Chancellor of the Exchequer is being thoroughly unsound.

The second point is that, assuming we can afford this £1,000,000, is this the way we want to spend it? My second Amendment provides that if the £1,000,000 is given it shall be a £1,000,000 on top of the Post Office surplus—not the present Post Office surplus, but the next £1,000,000. If anyone thinks that any number of Members really wish the first £1,000,000 of relief to be given to the Post Office, then he has entirely misunderstood the whole trend of our Debate. A concession, if a concession is given, might be applied to obsolescence of machinery, allowances of Income Tax, or the restoration of cuts, not to mention such things as judges' salaries. There are scores of things to which, probably, every Member would wish priority to be given, other than the Post Office. We ought, before the Finance Bill leaves this House, to have some very clear defence of this unexpected and, to me, unwelcome generosity. The House was agreed that the Post Office fund should be set up. All I object to is that this particular £1,000,000 should at this moment be allocated. If it were £500,000, my objection would be less. If it were £1,000,000 on top of the existing Post Office surplus, I would welcome it, but to take it from our present tax resources—although it is to be put to an excellent use, we all agree —is not what any substantial number of Members of this House desire. All the commercial interests in my constituency will highly resent it.

7.8 p.m.

Mr. C. BROWN

I would not have intervened but for the speech of the hon. Member for Central Leeds (Mr. Denman) to which we have just listened. The hon. Member belongs to a section of the National Government whose attitude on a question like this is extraordinarily interesting to some of us. I may remind the House that he is a National Labour Member. I cannot understand how he can get up and make a speech, such as the one he has just delivered, on the assumption that the Postmaster-General and the Government are doing something rash. Surely there is nothing being done on this occasion which can be characterised as rash or indiscreet. I recollect the Postmaster-General at the time of the last Government. There has been a change in his attitude since he became a Minister, a change which is very remarkable indeed. I have never witnessed such a transformation in an individual. The Postmaster-General has spoken in a very minor key, contrary to the usual speeches he used to deliver. I could not help thinking, when he was talking to us, that nobody need have any fear of his doing anything rash with Post Office funds or developments. How the hon. Member can imagine that this Government will be guilty of extravagance, or rashness of any description, passes my comprehension.

Perhaps it is in keeping with the tradition and the creed of the party to which the hon. Member belongs that they should repeatedly ask, "Can we afford it?" That is going to be the constant refrain of the National Labour supporters of the National Government. If it had not been for the miserable pessimistic utterances to which we have just listened I would not have intervened. We need have no fear that the Postmaster-General will do anything rash, or anything likely to imperil any funds. He will not even risk these funds in giving better conditions to Post Office servants. The hon. Member for Central Leeds need have no fear. Let him remain loyal in his support of the National Government, for they will do nothing rash or indiscreet.

7.12 p.m.

Mr. HORE-BELISHA

When I disappeared from the view of the House I received an S.O.S. from the Member for Central Leeds (Mr. Denman), who thought it scandalous that a Clause of this kind should be passed without my making some observations upon it. I accordingly submit myself to his catechism. He wishes to have an answer to two questions. The first is whether we can afford what he was pleased to describe as "it." I reply that I have read in Boswell that when Dr. Johnson described a lady as an "ass," she complained, whereupon he said, "If I had not meant it I should not have said it. "My reply is that if we could not have afforded it we should not have introduced this Clause. We believe that the increase in trade and business that would accrue from putting the Post Office on a new foundation will amply repay us.

My hon. Friend's second question was whether there was no better object on which we could spend it. I think that the more we can do for trade and business the more we shall do for employment. It was not right and just that we should continue to exact a higher contribution, for instance from the telephone subscribers, than the occasion merited, if the Chancellor of the Exchequer could assist the Post Office to develop the telephones and give a better service to the country. I hope these two clear and concise answers will remove any misapprehension in my hon. Friend's mind.

Mr. ATTLEE

I beg to ask leave to withdraw the Amendment. Amendment, by leave, withdrawn.

7.14 p.m.

Mr. DENMAN

I beg to move, in page 26, line 22, to leave out the word "eleven," and to insert instead thereof the word "twelve."

Perhaps after the very courteous reply of the Financial Secretary to the Treasury, I need not move my first Amendment—In page 25, line 19, at the beginning to insert the words: When the Public Accounts Committee has reported that in the preceding financial year the sinking funds, in respect of specific British Government loans have been met out of revenue, and"— I move my second Amendment because it is of great importance, and has not yet been answered. Everybody who votes with me on the question of whether this £1,000,000 should come out of existing revenue, or should come from any revenue which, we hope, the Post Office will easily be able to earn in more prosperous times, will have the blessing of his constituents.

Mr. SPEAKER

There being no Seconder, the Amendment lapses.