§ 7.38 p.m.
§ Mr. DICKIE
I beg to move,That, in the opinion of this House, it is essential in the national interest and the 448 interests of the coal-mining industry that the coal export trade should be freed as speedily as possible from the restrictions imposed by Part I of the Coal Mines Act, 1930.It is safe to say that no industry has occupied a greater share of the attention of this House than the mining industry. Commission after Commission has been appointed to inquire into the state of the industry, Act after Act has been placed upon the Statute Book, to regulate and control it, and even in the brief lifetime of this Parliament the subject has been debated on several occasions. In every Vote of Censure moved from the 449 other side of the House a great deal of time has been devoted to what I might call the tottering throne of old King Coal. Despite these facts, I and my friends who were associated with me, who represent mining constituencies, who are very gravely concerned as to the position in those constituencies and who view the future with general alarm, make no apology for directing the attention of the House once again to the steady decline in our export trade in coal, to the position which is created by that steady decline and the manner in which it affects the national interests.
Next to agriculture the mining industry remains still our greatest industry. It is the foundation of all our heavy industries. In the domain of domestic industries it is perfectly safe to say that, no matter what may be the scientific development in the utilisation of other forms of fuel, for us for many years coal must remain the foundation on which the whole structure of our industrial edifice must rest. It is equally true to say that if we are to maintain our position as the greatest exporting nation in the world it is vital that we should maintain our exports of coal. In bulk they are the greatest of our exports. The shipowners depend on the outward freight to cheapen the inward freight and thereby enable us to purchase more cheaply the food and raw material that we need for our sustenance, the raw material of our industry, a matter of primary importance in a country which must draw its supplies from the ends of the earth, and upon which it depends as a competitive nation in maintaining its position in the markets of the world.
The coal industry must, therefore, remain as a fundamental factor in our economic life. Its effect upon our national life is not to be judged by the state of prosperity or depression in the mining industry alone. The prosperity which is derived from the mining industry finds its way into the broad stream of our national life. It percolates into the thousand channels of the national life and enriches and benefits the whole. Similarly, the severe depression in the coal exporting areas, which reduces them, as they have been reduced during the last few years, to a state of beggarly demoralisation, with its consequent loss of purchasing power, due to the poverty of those producers of wealth, is reflected 450 in every industry catering for the home market, apart altogether from its effect upon our international trade. I bring forward the Motion in the hope that it will appeal not only to those who represent mining constituencies, and who are directly interested in the industry, but to the general body of hon. Members, and that the Government will accept it and proceed at once to implement it, for the situation in those areas is becoming really desperate.
Every time that I am asked what are my objections to the Mines Act in its application to the export trade, I am reminded of an episode in the life of the great Dr. Johnson. It is said that on one occasion when he was on one of his trips to Scotland he stayed for dinner at Oxford, celebrated then for its learning, famous since for its Union, and now notorious for its patriots. On that occasion he dined on chicken. The dinner does not appear to have been a remarkable success, for when he was asked about it afterwards he said that the chicken was badly hatched, badly reared, badly Tilled, badly dressed, badly cooked and badly served, otherwise it appears to have been quite a good chicken. So it is with the Act of 1930 and its application to the export trade. Whatever may be said of that Act as far as inland trade is concerned, I submit that it is impossible to bring forward any valid arguments for a continuance of that part of the Act which inflicts a stranglehold on the export section of the industry by regulating the output and imposing the fixation of prices.
The disastrous effect of the application of the provisions of the Act to the export industry was foreseen by hon. Members who opposed it during its passage through this House, and by many people outside who were well qualified to speak on behalf of the industry. Almost every one of the Ministers of the present National Government opposed this Act during its passage through this House, including the two hon. Members who have been Secretary for Mines, and they opposed it particularly in its application to the export section of the industry. I will not weary the House with long quotations from speeches, they can be found in the records of the House and hon. Members can read them for themselves; but I say quite frankly that I 451 am astonished that members of the present Government should have allowed this Act to remain on the Statute Book unamended for 18 months, when month after month was clearly revealing that their own fears were well founded and their own phophecies well justified. As far as outside opinion is concerned I could quote many authorities as to the effect of the application of its provisions to the export trade, but I will content myself with one from a colliery in my own constituency. The relevant portion of the letter is this:The present Government has definitely stated that if any district fails to produce a scheme the Government would force one upon them, and it was undoubtedly this threat which intimidated many into voting in favour of a so-called voluntary scheme of their own making, although they had little or no confidence that it would work without inflicting serious loss both on owners and workmen throughout the county, as, owing to the fact that the Durham coal trade lives largely by its exports, any control, with its resultant restriction of output, will increase costs, while price fixing will almost inevitably lead to the loss of orders in foreign markets.That is a letter from the chairman of a colliery in my own constituency—Mr. Sydney Wilson.
§ Mr. DICKIE
The hon. Member, as on a previous occasion when I was speaking, is a little premature. He will hear something about the bigger concerns before I have finished. But the same thing runs right through the exporting districts. The hon. Member for Spennymoor (Mr. Batey) knows the county of Durham as well as I do, and he knows the disastrous state of things prevailing there partly as a result of the 1930 Act. That Act came into operation on the 1st January, 1931, and it was not long before the dismal forebodings of those who had foretold what was likely to happen were fully justified. The matter was raised in this House and on the 19th March, 1931, the present Secretary for Mines expressed grave apprehension as to the effect of the Act upon our export trade. He concluded his speech on that occasion with these words:Those who attribute the fall in shipments to the quota system say that the quota system is the worst that could possibly be adopted, for it takes no account of the varying classes of coal nor of the fluctuating 452 demand which has always existed and always will exist in the coal trade. It is also held by some of the shippers that the coal market can only be maintained by full production and low costs, and it is the opinion of some coal traders that this particular system has meant higher costs. I hope the Minister will believe me when I say that evidence comes to us from all parts of the country that there is grave disquiet at the working of the quota.There is even greater disquiet to-day. The hon. Member for Leith (Mr. E. Brown) concluded by saying:I beg him not to take merely the departmental view that the Act is all right and must be all right for everybody, merely because some central committee says so."—[OFFICIAL REPORT, 19th March, 1931; Col. 2241, Vol. 249.]That speech was made by the Secretary for Mines when he was a private Member of the House. He is now Secretary for Mines and I am a private Member; and I am making the same appeal to him as he made then to the then Secretary for Mines. This Act is not all right. As far as the export trade is concerned it is all wrong, and its effects must be remedied at once unless we are prepared to face a still further decline in our sales to foreign countries, with disastrous results to our industries, our shipping, to the balance of trade and to the nation as a whole. Before I deal with the question of minimum prices may I remind hon. Members of the figures relating to production and export? In 1913 we produced 287,000,000 tons of coal, and of that we exported as cargo 73,000,000 tons, and as bunkers 24,000,000 tons; making a total of 97,000,000 tons. That 97,000,000 tons—and this is the point to which I want to draw special attention—represented 33.8 per cent. of our total production. In 1932 our total production had fallen to 209,000,000 tons, our exports of cargo coal to 39,000,000 tons and our exports of coal in bunkers to 14,000,000 tons, a total of 53,000,000 tons. But that 53,000,000 tons represented only 25 per cent. of our production. We have lost in 1932 as compared with 1913 no less than 44,000,000 tons of coal; and we are actually exporting 8.8 per cent. less of the diminished production.
It must be remembered that a million tons of coal represents employment for 4,000 men. We have lost 44,000,000 tons of coal, and that represents a loss in employment of 176,000 miners. That is something which should give every hon. 453 Member cause for deep thought. But that is not all the loss in employment, because it must be remembered that there is a loss of employment to those engaged in shipping, on the railways, in our docks and harbours; and all the ancillary trades. In addition there is the value of these 44,000,000 tons of coal which we have lost, and the House will realise the serious effect which this has upon the balance of trade. I do not quote these figures as evidence against the Coal Mines Act of 1930, but merely to draw the attention of the House to the importance of our export trade in coal. Coming to the position during the last few years I want to point out that by 1929 we were recovering steadily from the effects of the long drawn-out stoppage of 1926. Our exports, I am speaking of cargo alone, had risen again to the substantial total of 60,000,000 tons.
§ Mr. DICKIE
I brought a mass of figures with me but I cannot put everything into terms of percentages. If I did I should occupy too much of the time of the House. The point I want hon. Members to remember is that when the Act came into force in January, 1931, there were no quotas or exchange restrictions, or licensing regulations, in operation against our coal, hut the very moment it came into force our exports began to fall, and to fall heavily indeed. Whereas in 1930 we only lost 5,000,000 tons in 1931 we lost no less than 12,000,000 tons, and in 1932 we lost another 4,000,000 tons, so that our exports now stand at the phenomenally low figure of only 39,000,000 tons, or little more than half of our exports in 1913. This tremendous decline was no doubt due to a number of causes, not entirely to the Coal Mines Act of 1930, but it is difficult to determine how much of the decline to attribute to each. There is the world depression and the greater use of other forms of fuel, oil, electricity, white coal, tariffs, licensing systems, quota restrictions and, of course, the Act of 1930, all of which played their part.
Some of these things are imponderable, but two of them we can at least weigh roughly, the restrictions imposed by other 454 nations and those which we have imposed upon ourselves. I ask the House to look at foreign restrictions, for it is no part of my case that the whole of this decline is due to the Act of 1930. The countries where the quota system is in operation are France, Germany and Belgium. Take France. The quota was imposed by the French Government in July, 1931; that was the first evidence of a quota restriction by foreign countries. In two years, from 1930 to 1932, the imports into France declined by 7,000,000 tons, from 25,000,000 to 18,000,000 tons, and our share of that decline was from 14,000,000 tons to 9,000,000 tons. That is to say, out of a total reduction of 7,000,000 tons in the imports into France our share of that loss was no less than 5,000,000 tons. Expressed in terms of percentage, as far as total losses are concerned our reduction was 6 per cent., whilst every other country, Germany, Poland, Holland and Belgium, showed an increase of imports into France. That is something which gives cause for thought and should give the Government cause for grave concern.
§ Mr. GODFREY NICHOLSON
Is it not a, fact that we always exported to France up to the full amount that the French allowed up to export, and that their system of licensing has caused that discrepancy?
§ Mr. DICKIE
There was then no system of licences. That system did not come in until later. The case which is sometimes attempted to be made against the National Government, that the decline in our export of coal is due to tariffs and retaliation, is a case which will not bear a moment's examination. [HON. MEMBERS: "But it is true."] I hope that the hon. Member for Chesterle-Street (Mr. Lawson) will prove that it is true, and I shall be very much surprised to see bow it is done. Then look at Germany. In Germany the quota was not imposed until February, 1932. We were not even considering tariffs in this country at that time. It is idle and foolish to say that a restriction of this kind was a form of retaliation when we had no tariffs of any kind and were only beginning to consider the use of that particular weapon. We had to share the brunt of the loss as far as Germany was concerned. We lost 2,564,000 tons. France and Holland increased their exports to Germany, while the Saar and 455 Czechoslovakia decreased only very slightly. Belgium did not impose a quota until October, 1931. In the same two years the imports into Belgium declined by 3,600,000 tons. We lost 1,340,000 tons—not so bad in total, but in percentage we actually suffered a loss of over 50 per cent. in the quantity supplied to Belgium.
These are quota countries. The restrictions that they imposed have undoubtedly restricted our exports to those countries, but I do not believe that they account for the whole of the reduction. Restrictions imposed by foreign countries make trading somewhat difficult for coalowners and exporters. I cannot see that that is any reason why this House should add to their difficulties by legislative enactments which are almost impossible of application to a difficult and complex business like the export of coal, and only hinder and hamper our exporters and coalowners in their endeavour to secure business. Over the first we have no control, but the second, the combination of quota and price restrictions, I regard as a double-headed Frankenstein of our own creation, which is threatening to destroy our export trade. If we do not destroy it, it will destroy us so far as that particular section of the industry is concerned. I have always found it exceedingly difficult to understand why these restrictions were imposed on the export trade.
We have had an extremely interesting speech from the Lord President of the Council. As I listened to him I wondered whether the Cabinet was embarking upon an experiment based on the theory which the right hon. Gentleman propounded a year or two ago, that the solution of our industrial problems was to be found in a restriction of our exports. I could never see how it was to be done. Why these restrictions should be imposed by ourselves on one of our vital industries I am really at a loss to understand. I believe in freedom from these restrictions. But part at least of this lost business is recoverable, despite the quotas and the licensing system. Part of it has been lost on account of a feeling of resentment against the fixation of prices, and that despite the well-known fact that a very large quantity of coal is being purchased below the minimum 456 price and also because of the uncertainty of being able to obtain supplies, owing to the quota.
There is a very powerful opposition in every one of these countries to the system of licensing and quotas which has been established there, and if we remove the objectionable features over which we have control we could immeasurably strengthen the opposition in those countries and perhaps succeed in having these things swept away altogether. We are not holding our own. That is the main feature that we have to visualise. The whole of the other big exporting countries, grouped together in those three particular years of which I have spoken, lost in their export trade in coal only 28 per cent. This little country lost 35 per cent. The total loss of the quota countries is something like 9,000,000 tons. A fair proportion of that is recoverable, and I regard it as pure defeatism to regard those orders as an irrecoverable loss. They can be regained, but the only way to regain them is to give our coal-owners freedom to produce and our exporters freedom to go out into the markets of the world and seek orders.
§ Mr. DICKIE
The 9,000,000 tons is the total which we have lost in those three years, in what I call the quota countries. These restrictions of the minimum price and a quota have made it very much more difficult to get business. As orders became scarcer production decreased, naturally, and as production decreased the cost per ton increased. Irregularity of working always leads to an increase of cost. In the case of the average pit producing 500 to 1,000 tons a day one single day lost during a fortnight will put up the cost for the whole of that period to anything ranging from 7d. or 8d. to 1s. a ton—a very serious charge on the industry, and more serious than the royalty charge of which we hear so much from hon. Members opposite. Output and production costs are very closely related. But our coal can only sell at world prices. That is one of the things of which we are losing sight. We are deliberately choosing to pursue a policy of handicapping, ourselves in our attempt to meet competition in the markets of the world. If persisted in it can only lead to a still further decline, to a point 457 where the purchaser will buy only from us those classes of coal which he cannot obtain elsewhere.
Despite the world depression and the diminished demand, I consider that there is still a very wide field in which we can recapture lost trade. It must also be remembered that when you have greater freedom and keener prices you will open up new avenues to business. There are still new avenues. But the objections to the quota. and the minimum price have been reiterated so often that I do not want to go into them in detail. So far as the quota is concerned, I regard it as altogether an evil. In the way it works it is a premium on inefficiency. The call everywhere to-day is for efficiency in industry, as in every other walk of life, yet here in this important industry we are actually keeping alive pits which ought to be closed, many of which ought to have been closed years ago, and in some of which no miner ought to be allowed to work at all to-day. These pits are being kept alive at the expense of the economic pits and at the expense of the miners' wages, for that is how it works out.
Let me say a few words about the method of allocating a quota. It is both cumbersome and slow, and in the export trade it is a positive hindrance to business. The very existence of the quota prevents the making of long-term contracts, and the uncertainty as to what quota it will get deprives the whole industry of anything in the way of security or stability. In the districts the quota is allotted on the standard tonnage of 1929. That was a good year for some pits, but a bad one for others, and a moderate one for still others. No allowance is made for the change in circumstances since. The allocations are made, and every pit which was allotted a standard tonnage in 1929 can claim its share of the allocation now. The quota falls like the gentle rain from heaven upon the efficient and upon the inefficient alike. A demand may arise for some particular class of coal, as in the case of Northumberland steam coal some time ago. The demand cannot be met unless the collieries which are actually supplying that coal are prepared to face the possibility of having to pay a fine of 2s. 6d. for every extra ton of coal that they produce, or unless they are prepared to pay, not what was in- 458 tended under the Act, but an exorbitant figure, Is. 6d., 1s. 9d. or even in some cases as much as 2s. 6d.
The colliery which pays the best wages is thus penalised. The collieries which run uneconomic pits are allowed to continue, and some of them in June of last year, though actually bankrupt were living upon the quota. In an age when we have pleading in every direction for efficiency, that is an outrage and a scandal. It is something that in my judgment ought to be abolished altogether. A very important point is this: What happens when this transfer of quota takes place? The efficient colliery which has exhausted its quota has need of additional quota. It seeks to buy from its neighbour which may have quota to dispose of. The owner of the neighbouring colliery knows that the other fellow is in a tight corner. Accordingly, he puts up his price and asks for an additional 1s. 6d. or 1s. 9d. per ton. In order to keep his pit going in the national interests, and keep his men employed, rather than be fined 2s. for overproducing, the owner of the efficient colliery which has exhausted its quota consents to pay the additional 1s. 6d. or 1s. 9d. That is a charge against his production costs. It enters into his ascertainment and affects wages. What happens at the other end A man sitting in his office drops the telephone, lights a cigar, touches a bell, tells a junior clerk to make an entry in his ledger and he makes a clear profit of 1s. 6d. or 1s. 9d. per ton. That is the condition of things in the mining industry to-day and I tell the Secretary for Mines that it is high time it was stopped. In some cases the sale of quota has been refused altogether or has only been made under pressure.
Now I come to the question of the minimum price. [Hog. MEMBERS: "What about the minimum wage?"] I am prepared to deal with that subject also on the proper occasion. At the moment I want to deal with the minimum price, which, I may remind hon. Members opposite, affects the wages of the miner. That is a fact too often forgotten on the other side of the House. There is far too great a tendency for hon. Gentlemen opposite to talk as though nobody but themselves knew anything about the mining industry or had any interest in the miners. [HON. MEMBERS: "Hear, hear !"] I am very glad to hear that 459 approval from the hon. Member for Chester-le-Street (Mr. Lawson). He at any rate knows that it is not right—
§ Mr. DICKIE
The hon. Member knows perfectly well what I mean. He knows as well as I do that many of us here have the interests of the miners at heart as much as any hon. Member opposite. Many of us have lived among the miners and know all about their daily difficulties and the troubles which they have to face and the hunger and the privation which both miners and miners' wives are suffering. We know these things as well as any man who calls himself a miner's Member, and we are anxious to do something practical here and now to help them to better conditions. In my judgment the minimum price is worse than the quota. It may be possible to make out a case for the fixation of prices in the inland trade, but it is utterly impossible to make out any case at all for the fixation of prices in the export trade. The House should remember that we are only one seller. We are trying to sell and to make world prices. We are trying to compel the buyer to buy at onr figure although there are other willing sellers in a free market. That is what is happening under the minimum price. The principle is so unsound that I wonder how on earth it was ever accepted.
It is quite impossible to keep these prices secret. They are known to our foreign competitors. The moment the executive board in any district settles prices, the wires are busy and the prices are known in Hamburg, Antwerp, Oslo, Berlin, and everywhere else, in some cases, before they are known to the owners in the district itself. That is a state of things which would be tolerated in no other industry and which no other industry could survive. Under this Act, too, we deny the privilege which is always accorded to the buyer who places a large order. If the minimum price is observed—I say if it is—the seller must quote to the purchaser the same price per ton for 1,000 tons as for 100,000 tons. It is little wonder that the large buyers on the Continent should look elsewhere for supplies. What would happen in the engineering industry, for example, if 460 some of our big engineering firms were asked to tender through the Overseas Trade Department, let us say, for locomotives for a. foreign Government, and were told that they had to tender at the same rate for 10 locomotives as for 100 locomotives; and if, as soon as the tender had been received, the prices were forwarded to their Belgium, Japanese, American and other competitors. Yet that is the actual position in the coal export trade. It is sheer folly to advertise the prices to the world in this fashion.
During the debates on this subject at the end of May and beginning of June last year, I touched on the question of evasion. I said then that it was a, subject which had to be treated with great delicacy. At the present time it needs to be touched upon with even greater delicacy. The hope expressed by the President of the Board of Trade that the longer this went on the stronger would be the power of the owners and the better they would be able to deal with that sort of thing, has not been justified. Evasion has grown steadily worse, until, to-day, it is not too much to say that the export section of the industry is in a state of utter and absolute demoralisation. This Act of Parliament is undermining British commercial morality and driving honourable business men to do things which they loathe and detest. In a difficult technical and complex business of this character—and this disposes of the Amendment which I see on the Order Paper—neither the Commons House of Parliament nor any other form of tribunal can stop these evasions. Those who are evading the Act know that perfectly well. The hon. and learned Member for East Bristol (Sir S. Cripps) knows that however strong a law may be there is always a means of evading it. This law is being evaded every day and there is no power in the House of Commons or the owners to stop the evasion. The only way to stop it is to uproot the causes which have led to it.
Separately, I contend, that these two things to which I have referred are bad. Jointly they form an unholy combination which is having a terrible effect upon our export trade and our export trade will never recover until we get rid of them. I wish to deal with some of the arguments which have been used in favour of the retention of the quota. The 461 most illogical is one which has been used, both from the Government Front Bench and from the other side of the House. That is the argument "Oh, you have not exhausted your quota for the last quarter." What is the position? You impose a quota on a district and on the individual collieries in that district which definitely restricts their output, which prevents them under penalty from producing more. This restriction causes irregularity of working and irregularity increases the cost of production. They cannot get a higher price and you debar them from taking a lower price, which they could do if they were working at full capacity. When they complain you say, "But you have not exhausted your quota for the quarter just concluded." That is the most illogical argument that could be used.
Another argument is that our potential capacity is 300,000,000 tons, that last year we produced 210,000,000 tons, and that we ought to be content with our share of the world's production. I do not agree with that. Our potentioal capacity may be 350,000,000 or 400,000,000 tons and the actual output ought to be regulated only by the amount of coal that we are able to sell in the markets of the world. I ask is that principle to be applied in other industries such as the iron and steel industry, the cotton industry and the motor ear industry Their potential capacity for production is greater than the demand at the moment. Is that to be made a reason for Government interference and for imposing regulations which hinder and hamper their efforts to secure orders?
The third argument which I have heard is that if there is a repeal of Part I prices will slump. I do not believe it. I remember that when the Act was passing through this House people, both inside and outside the House, said that as soon as it was placed on the Statute Book it would have the effect of increasing prices enormously. Nothing of the sort happened. It was pure speculation then, and it is pure speculation now. There is nothing to show that there is likely to be any slump in the price of coal, even if Part I of the Act is repealed. I would remind the House that as far back as the 2nd June the ex-Secretary of Mines promised that he would give this matter his immediate consideration. In reply to my hon. Friend the Member for Bishop 462 Auckland (Mr. Curry), who asked if some assurance could be given that immediate steps would be taken to inquire into and amend the operation of Part I, the Minister said:I need not dwell upon it now, but I gave a definite and categorical assurance on that point. I said that we were awaiting from the Mining Association the amendments that they had under consideration, and that, as soon as those amendments had been notified to us, they would be correlated with the amendments that we had in our own minds, and the Government would decide what Amendments would then be brought forward.—[OFFICIAL REPORT, 2nd June, 1932; col. 1376, Vol. 266.]A little later in the Debate he gave me a similar categorical and definite assurance which wound up with this:It is our business to do all that is humanly possible to recover those markets, upon which our export trade depends."—[OFFICIAL REPORT, 2nd June, 1932; col. 1465, Vol. 266.]Now we are in the position that things have been going from bad to worse, and nothing has been done. I suggest that the only cure for this sort of thing is either to amend the Act so drastically as to give complete freedom to the export areas, or, failing that, to repeal Part I of the Act altogether. It may involve legislation and setting up some scheme of co-ordination of prices between districts and co-operation within the districts, particularly in the inland section of the trade, but, so far as we in the export areas are concerned, we are not prepared to be debarred from those markets which we have built up and which we enjoy to-day. We ate a maritime nation, and we have a very big coasting trade. The first coal that was borne to London or to the South of England came from Newcastle, and that is why it was called sea coal. We have captured these markets because the freight from the North of England to the South is only 4s., while the railway rate is 19s. Does anyone contend that the proposition of the ex-Minister of Mines that we should pay 15s. extra for coal in order to bolster up the railway transport is a serious business proposition It is a question of transport, and all that we ask for in those markets is that we shall have a fair field and no favour.
A few weeks ago the Minister of Mines opened some estates on the River Tyne. We have been very badly hit there, but we have not lost our courage. We have 463 spent £120,000 in building those estates, and they are to-day in all probability the most modern in this country. The Minister then gave us some good advice, which was that we should throw away despair. We are throwing it away, and we ask him to help us to get rid of it entirely. I will not say anything about bunkers, but I hope the Minister will consider that important aspect of the mining problem, as we are losing in that direction as well. In so far as the export trade is concerned, the Government and the Minister of Mines should do everything they can to give us back our freedom, in order that we may fight in the markets of the world for the orders on which the industry depends. This matter was placed before the House very much more eloquently than I can place it by the present President of the Board of Trade in March, 1930. What he said hits the situation exactly now, as it did then, because the position is precisely the same except that it has got a great deal worse. The right hon. Gentleman then said:It seems to me that, the more one looks into the question of the export trade, the more essential it is that it should be given the utmost elasticity, that no checks should be placed upon it in the interests of all concerned, but that it should have complete freedom to meet the demand as and when it arises. Do not let it be imagined for one moment that those who control the coalfields of foreign countries are going to be so merciful to us. They want to get business, and so do we, and it is our duty to capture it for the sake of the national trade and of the miners employed in it. Anything that we do to take away our freedom in the foreign export trade to capture those contracts, will be throwing away much of our present organisation for the sale of Coal."—[OFFICIAL REPORT, 11th March, 1930 col. 1167, Vol. 236.]The position is getting steadily worse, and last week was the worst week the Tyne Improvement Commission has known since the general stoppage of 1926. On Saturday last one of the pits in my district closed down, and over 200 men were dismissed. On the same day another colliery issued notices involving the dismissal of another 700 men, and only yesterday in my constituency, the largest producing concern, owning a large number of collieries and employing 6,000 men—each and every one of those collieries was idle, and may be idle to-day, on account of the loss of trade. 464 I submit that this is a very important matter, and I would—
§ The SECRETARY for MINES (Mr. Ernest Brown)
Do I gather that the hon. Member attributes all that to the operation of Part I of the Act?
§ Mr. DICKIE
No, and I think the House will agree that I have been perfectly clear in saying that I do not attribute all this to the Act. I am calling attention to the very serious and grave position, and I put this Motion on the Paper because I want to see something done in the interests of these miners and their wives and families. I have dealt throughout with this matter as a business proposition primarily, but I know perfectly well that it is not entirely a business proposition, that there is a human side to it; and a very tragic human side it is. I know something about the sufferings which have been caused by unemployment, by irregular employment, and by low wages. This problem of the export of coal is one of the problems of the devastated areas, which are nearly all in the districts where we export coal, and I ask the Government to consider this matter, because it arises not only in our constituencies; in the very constituency of the Prime Minister himself the pits are working most irregularly, little more, I am told, than half-time, and I ask the Government to consider the matter, not only as a business matter, but to visualise the great mass of suffering in those areas and, by prompt and effective action, to do something to alleviate the situation.
§ 8.34 p.m.
§ Mr. CLARRY
I beg to second the Motion.
I think the thanks of the House are due to my hon. Friend the Member for Consett (Mr. Dickie) for bringing this vital matter forward for discussion, and we very much appreciate the detailed and forceful manner in which he has put his case. I do not propose to speak at any great length, but I would like to crystallise the position and the seriousness of it. Coming from one of the largest exporting areas in the country, South Wales and Monmouthshire, and representing Newport, which is the port of shipment of the Monmouthshire coalfield, it is a matter of very vital and urgent importance to us, and representa- 465 tions have been made to me which, in passing on to the Minister, I cannot urge with too much forcefulness. When Part I of the Act was originally discussed, its purpose was stated to be to adjust the supply of coal to the current effective demand and to deal with the dead weight of from 60,000,000 to 80,000,000 tons excessive capacity available in the country. At the same time, the Minister made it clear on the subject of prices that, in granting to the coal industry the power to impose minimum price schedules, it would provide the industry with the necessary revenue to maintain wages and to secure a reasonable profit to the owners.
It will not be denied that these two objects have not been achieved. It is true that progress has been made in the stabilisation of prices, although the effect of the Act in this respect is controversial. The fundamental point is that pithead prices during the operation of Part I are actually lower than in 1930–31. Meantime, the costs of production, in which the cost of the administration of the scheme bears some important part, have helped to keep up costs when other competitive industries have been able to reduce their costs of production. With regard to exports, which is the real subject of this Motion, during the three years our exports have fallen from 60,000,000 tons to nearly 39,000,000 tons. Of that quantity, South Wales and Monmouthshire exports have fallen from 24,000,000 to 16,000,000, or by 331 per cent. It is idle for anyone to argue that this is entirely due to the operation of this Act. There are many other causes. There is the much fiercer competition by foreign exporters. There is a world depression, and of course there is the operation of quotas from three countries—France, Belgium and Germany—while Spain is endeavouring to enforce some form of quota but the rest of the world is free and unrestricted.
If we make comparisons in the realm of the world export trade, we find that Great Britain has suffered more during the operation of this Act than the other five important exporting countries. Great Britain's exports during this period have fallen 35 per cent., while the exports of the other five countries have fallen only 28 per cent. This is a very serious matter, and, if we were to calculate the 466 quantity of coal we should have exported last year if we had been able to maintain the same pro rata export as our foreign competitors, it would represent 5,000,000 tons of coal, and it is not too much to say that this loss is mainly due to the operation of Part I of this Act. It might be argued that if we had to sell this 5,000,000 tons of coal, it would have to be sold at a lower price than the present prices, which in some cases are uneconomic; but against that we have to offset the lower cost of production due to the larger outputs of the collieries.
I have no need to stress the necessity for exports from this country in order to assist our trade balance and the importance of coal to shipping, because, in spite of the reduction in the tonnage of shipping, coal still forms four-fifths of the total weight of tonnage exported from this country, and approximately two-fifths of our ships are bunkered by our coal. When we came off the Gold Standard it was felt that it would be a great opportunity for our exporters, particularly coal exporters, but the operation of the quota and price fixation has practically nullified that advantage. Foreign exporters are aware of the quotations which are made in competitive markets and are able to quote only a fraction of a penny less than we quote in order to obtain our business.
Coal is very often sold, particularly abroad, because of its description and fitness for special purposes, and numerous cases can be cited where exports of coal have been lost to this country because the particular colliery that can supply the customer's particular requirements has used up its quota. While these points apply to all exporting areas, I submit that it has a particular bearing on South Wales and Monmouthshire, which is a very distressed area, and the indirect operation of this Act has been a, means of diverting Monmouthshire coal, which would be normally shipped at Newport, to other ports. This is a subject of strong representation from the Newport Chamber of Commerce, together with the condemnation of Part I of the Act. Strong representations have also been made by the Association of British Chambers of Commerce and the Chamber of Shipping to end export restrictions. In the search for measures to find work to relieve the 467 heartbreaking unemployment in our distressed areas, I submit that we have a means here at hand for increasing work in our coalfields, railways, docks and shipping by giving back to the exporting and bunkering coal trade the freedom which was taken from it by the operation of this Act.
§ 8.43 p.m.
§ Mr. GEORGE HALL
I beg to move, in line 1, to leave out from the word "That" to the end of the Question, and to add instead thereof the words:This House approves the action taken to continue Part I of the Coal Mines Act, 1930, for a further five years, and urges the necessity for a strict supervision of the operations of the district committees in order to ensure the effective administration of the law.Like my hon. Friend who moved the Motion, I represent a mining division, but, unlike him, I ask for a continuation of Part I of the Act. I ask that because I think that it is in the interests of the mining industry that it should be continued. My hon. Friends and I are not going to argue that Part I of the 1930 Act is perfect. It is not perfect, and we should like to see some alteration, but we think that the people who should bring forward suggestions for the alteration of that Act are the people who are directly connected with the industry. I am tempted to ask my hon. Friend on whose behalf he is speaking. Is he speaking on behalf of the Mining Association of Great Britain?
§ Mr. DICKIE
Most assuredly not, and I very much resent the insinuation. I am speaking here as a Member of Parliament representing a mining division—the owners, the miners, the railwaymen, the postmen, the grocers, and everybody else in the constituency.
§ Mr. DICKIE
I have had the usual things which are sent to every Member of Parliament when a Motion of this kind is to come before the House—from coalowners, from exporters and from 468 chambers of shipping and other organisations which are interested; just the same as every other hon. Member has.
§ Mr. HALL
I also have received the usual circulars, but not one from the Mining Association, not one from the Miners' Federation, not one from a large producer of coal. From exporters—yes; from chambers of shipping—yes. We say that while the machinery of the Act is not perfect it embodies means whereby representations can be made for the purpose of tightening up the Act. My hon. Friend suggests that there are evasions of the Act. There are evasions, but that is not the fault of the Act but of the people who carry on the evasions. For my hon. Friend to suggest that Part 1 is driving honest business men to practices which they detest does not speak very well for the honesty of the mineowners of this country.
§ Mr. McKEAG
Surely the hon. Member realises that they have been doing whatever they could to find work for their own men.
§ Mr. HALL
If they deliberately break an Act of Parliament instead of endeavouring to fix the minimum price at which coal can be sold, it does not speak too well for them or the way in which they conduct their business. The point I want to make is, that if there are complaints against the Act, the whole machinery of the Act is in the hands of the owners themselves. That applies to the central committee and the district committees. No other body or organisation has any representation upon district or central committees. The number of complaints received about the administration of the Act is almost negligible. I will deal with the question of the quota. In the excellent report by the Mines Department on the working of the Act, issued towards the latter part of last year, they state, with reference to quota allocations:In only comparatively few cases has it been necessary for applications to the central council for increases in allocations to 469 be referred to arbitration. During the first three months of 1932 there were only two such references.Where are all the complaints about difficulties arising as the result of the allocation of quotas? My hon. Friend suggested that it is hardly logical to refer to allocations and output. It is interesting to note, according to this report, that in the first quarter of 1932 the actual output of coal was 15.7 per cent. less than the quotas allocated. In the county of Durham in the same quarter the coal output was 19.3 per cent. less than the quotas. In the June quarter the output was 8.6 per cent. less than the quotas and in the September quarter 16,23 per cent. less. Where are the mineowners sitting in their offices making 1s. 6d. a ton as the result of selling their quotas—just sitting at the telephone? Some of the statements made by my hon. Friend were almost unbelievable.
§ Mr. HALL
My hon. Friend took 50 minutes for his speech, and as this Debate will have to close at 11 o'clock he might give me an opportunity. As far as I know, my hon. Friend is not representing any organised body, either the Mining Association, the Durham Mining Association or the Miners' Federation of Great Britain. He may pay lip service to the question of the minimum wage for miners, but those of us who have had experience in negotiating the wages of miners know that without minimum prices they cannot get minimum wages. My hon. Friend is asking for unrestricted competition, yet we know that right along from 1921 until 1930, when the mineowners had unrestricted competition, the price of coal fell to 50 per cent. of what it was and the wages of miners fell to the same extent. The condition of the industry became very much worse under unrestricted competition, yet my hon. Friend is asking for a return to unrestricted competition. That would inevitably mean wages very much lower than those which are being paid at the present time.
We have had a shrewd suspicion, as the hon. Member for Newport rightly said, that chambers of shipping and exporters are, of course, pressing for the repeal of Part I of this Act. If there is any body of people who have made money out of the export of coal it is 470 exporters and chambers of shipping. The exporters can always live and the producers can always starve. The late Lord Rhondda, who was not only a coal producer but was an exporter, always maintained that he could make more money out of selling coal than out of producing it, and what exporters are concerned about at the present time is not so much the price at which coal can be produced as the commission they can get out of the selling of the coal irrespective of the price at which it is being sold.
As I have already pointed out, the organisation of the industry under Part I of the Act is entirely in the hands of the coalowners. They control the whole machinery, district and central. Mr. Archer, the chairman of the Export Committee of the Midland Amalgamated District, said recently that it was the duty of owners to operate Part I honestly and sincerely, and after they had tried to operate it in that way then, if they failed, they could inform the Government that they had been set a task which could not be performed. The coal-owners, however, were obviously unable to take that line. Despite some of the criticism, the majority of them would regard the repeal with dismay. That is the attitude of the Mining Association—not that I want to appear here this evening as an advocate on behalf of the Mining Association. That is the attitude of the Miners' Federation. I am speaking on behalf of the Miners' Federation. This Bill does not satisfy us entirely, but it is better than the unrestricted competition which would arise if the Motion of my hon. Friend the Member for Consett were carried. Mr. Lee, Secretary of the Mining Association of Great Britain, put the position of the coal industry from the owners' point of view quite clearly, in the article which he wrote in the "Colliery Year Book" for 1928. He said:The surplus of productive capacity over present demand, both in the inland and export market, has brought down coal prices far below the general level of prices. They have reached a point at which the economic operation of collieries is impossible and the capital resources of the industry are being gravely impoverished. As is well-known, schemes for co-ordinated action with a view to securing more economic relationships between costs of production and prices, are already under consideration in most of the large coalfields.471 That was under a Tory Government in 1928, before there was any suggestion of the introduction of the Bill which brought about the Act of 1930. Mr. Lee further said:Concerted action of this character is vitally necessary, not only to maintain the rates of wages of the mine workers in fair relation to those in other industries, but to avert the most serious danger to the very fabric of the industry during the abnormal period through which we are passing.Those were the words of Mr. Lee. It can be said of Mr. Lee that he knows his job. He knows the industry very well. We say that the condition of the industry is very much what it was in 1928, when Mr. Lee penned those words. The hon. Member for Consett referred to the fact that the present Secretary for Mines opposed the Act when it was passing through the House in its early stages. The President of the Board of Trade did likewise, and so did the late Secretary for Mines. When they were brought close up against the problems with which the mining industry was and is confronted, they saw that their attitude during the period when the Bill was passing through the House was wrong.
§ Mr. E. BROWN
If the hon. Gentleman will search the Official Debates, he will find that my objection was not so much to the case made out, but to the machinery which is now being discussed.
§ Mr. HALL
I remember the Debates and some of the speeches. I have here some of the speeches of the hon. Gentleman the Secretary of Mines. He will have an opportunity to deal with them later. I well remember some of the speeches which were made with regard to the tremendous increase of prices which was going to take place as a result of the operation of Part I of the Act. The increase of prices has not been brought about. There is a stability of price for which the mining industry is profoundly thankful. I am not going to quote figures other than from the export prices in 1929, to show that the price for coal exported from this country was 16s. 14d. per ton. The average price in 1932 was about 15s. 11d. per ton. There has been very little fluctuation. I am surprised that hon. Members who support this Motion are always asking, not only for stability of price, but for an increase in the price, to deal with unemployment.
472 The hon. Member for Consett is asking that we shall not have this stability of price in the mining industry, but that we shall have a reduction of price so that we can capture the market. That has been tried, and it has failed. I have already referred to the statement which was made by Mr. Archer, who knows questions of marketing. I am not going to take up the time of the House in quoting some of the statements that were made in the course of Mr. Archer's speech. I ask hon. Members to take the trouble to read the speech, which is published in some of the technical journals. The case for Part I and for some of the Amendments to Part I of the Act has been very well put.
The hon. Member for Consett really asks for the repeal of Part I of the Act, as far as the export trade is concerned. He, like myself, represents an exporting area in this House. He represents Durham and I represent South Wales, two districts which are, we can say without exaggeration, almost entirely dependent upon the export of coal. I take a good deal of interest in the export trade. It is, as the hon. Member for Consett rightly pointed out, a vital part of the trade and industrial life of this country, from the point of view of employment. If you destroy your coal export trade, you at once throw 200,000 workers out of employment and, in addition, all those who are engaged in the ancillary occupations upon railways or docks, or as seamen. My hon. Friends who come from the mining districts would not do a thing in any way to injure the export trade of this country. We are of opinion that the nation does not take the interest that it should take in the export trade. We hope that the coal industry, that portion which is producing for inland purposes as well as that which is producing for export, should be treated as one economic unit.
The hon. Member for Consett is asking in his Motion to give all the advantages, if there are any, of Part I of the Act, to inland districts, and to take away from the exporting districts any advantage that there may be. That is making the gulf very much further, instead of endeavouring to bring the exporting and the inland areas very much nearer. What a contrast to what is taking place in Germany, one of our main competitors, where the whole industry is organised for 473 the purpose of competing with us in those neutral markets. Not only are the inland and export coal industries in Germany and Poland acting together, but they have the support of the Government, which is very heavily subsidising the export of coal. Those Governments realise the importance of the export trade to the national life of the country. Figures have been given by the hon. Member for Newport (Mr. Clarry) and the hon. Member for Consett as to the loss of export trade. They did not give the figures for last year, and they made no comparison between the percentage loss of export trade in this country with the percentage loss of export trade of other countries which are our main competitors. I will give the figures.
§ Mr. CLARRY
I gave those figures, namely, 33 per cent. for this country and 25 per cent. for the other five countries.
§ Mr. HALL
I want to speak about last year as compared with 1931. The loss of export trade by Great Britain to foreign countries last year was less than 9 per cent., whereas in the case of Germany it was about 22 per cent., of Poland 28 per cent., Belgium 32 per cent., Holland 28 per cent., and the United States 27 per cent.
§ Mr. HALL
Yes, but it was last year, in reference to which my hon. Friend deplored the fact that there has been this terrible loss, which we all deplore. May I call the attention of my two hon. Friends and of the House to the real cause of the difficulty with which the export coal trade of this country is confronted? Reference has been made to restrictions, which have been aggravated very largely as the result of the fiscal policy of the present Government. Coal has been the pawn in the fiscal war that is being waged at the present time. I shall endeavour to prove that statement.
Which are the best customers of this country for export coal? There is an idea that coal exported from this country is being sent to the furthermost parts of the earth, but, instead of that, it is our near European neighbours that are our 474 best customers. In the year 1930, when we exported 54,800,000 tons of coal, one ton out of every four exported from this country went to France; 12,969,000 tons of coal left these shores for France. Italy took over 7,000,000 tons; Germany nearly 5,000,000 tons; and Belgium nearly 3,500,000 tons. These four countries, in 1930, took more than half the total amount of coal exported from this country, and, if we add the Irish Free State—where there is a very heavy duty at the present time—and Spain, 32,500,000 of the 54,000,000 tons went to these countries, which have now restrictions and duties against us. The same thing happened in 1931. Of the 42,000,000 tons of coal which we exported in 1931, nearly 26,000,000 tons went to these five countries. In 1932, of the 38,000,000 tons of coal that we exported, 20,800,000 tons went to these countries. All of these nations now have restrictions in the form of quotas or very heavy duties, and that is, to a large extent, the cause of the suffering in the exporting areas of this country.
§ Mr. SLATER
May I ask the hon. Member if these countries are justified, in view of their favourable balance of trade with this country, in imposing restrictions against our export coal?
§ Mr. HALL
I am not going to justify anything; I am simply stating facts, and I am sure the hon. Member does not doubt the facts. In the year 1931, our export trade suffered a reduction of nearly 16,000,000 tons as compared with 1930. The reduction in our exports to France, Italy, Germany, and Belgium accounted for 10,500,000 of the 16,000,000 tons, and, again, adding Spain and the Irish Free State, the loss in the case of these countries amounted to nearly 12,000,000 tons. Last year, as compared with 1931, showed a reduction of nearly 4,000,000 tons in our export coal trade. The reduction in the case of the four countries France, Italy, Belgium and Germany, accounted for 4,500,000 tons, or 500,000 tons more than our total loss of export trade for that year. Adding again Spain and the Irish Free State, we account for losses of over 5,000,000 tons, or almost 1,500,000 tons more than our total loss during that year.
My hon. Friend spoke about further reductions in prices. Does he or anyone else imagine that it is only a question of reducing prices in the face of the re- 475 strictions which exist at the present time? He may refer to the Scandinavian countries; he may refer to the market in Poland, and in Denmark, Norway and Sweden. I know that those countries took a larger percentage of coal from Poland and Germany during last year and recent years than they did previously, and there is no justification for that in view of the trade balance between them and this country; but, if we had the whole of the trade which Germany and Poland now have in those three countries, Denmark, Norway and Sweden—if we had sent them the whole of the coal that they required last year—it would not make up for the loss of our export market in the four countries to which I have already referred.
I am not going to deal with the question of restrictions, although it has been referred to—French, Belgium and German restrictions—but I would like to ask the Secretary for Mines if he will, when he comes to reply, give, not only the House of Commons, but the coal industry generally, an idea of how the negotiations with these other countries are proceeding. We heard some time ago that tariffs were to be used as a bargaining weapon. I want to say—I do not mean it in a personal sense at all—that, if any industry in this country has been treated in a brutal and callous fashion by the present Government, it is the coal mining industry, and especially the export trade. It is no use those who went-to Ottawa and negotiated the Ottawa Agreements coming here and saying that they brought back orders for an additional 100,000 or 200,000 tons of anthracite coal. The quality and price of Welsh anthracite coal almost demand a market for it. It is the one bright spot of the British coal industry, and it was so before the Ottawa Conference, because it was the one part of the British coal mining industry whose post-War output exceeded the pre-War output. I would also ask the Secretary for Mines to give us an idea when the Italians are likely to place the additional order for 1,000,000 tons of coal under The Hague agreement, from which South Wales has benefited so much. Already 2,000,000 tons have been sent, and there is an additional 1,000,000 tons waiting; and we are anxious that that order should be placed in South Wales as soon as possible.
476 We say quite frankly that there are defects in Part I of the Act. It has been shown that the Act has succeeded in maintaining some degree of stability in particularly difficult circumstances, but it has not succeeded in its main object, which was to fix such a price for coal as would give a proper standard of living for the miners, and, may I say, a fair margin of profit to the owners. Its failure must be attributed to some extent to the absence of proper co-ordination of prices between the districts. The mere fixing of minimum prices on a district basis tends only to substitute inter-district competition for individual competition, and it has been proved that this inter-district competition can be as severe as it was before the Act came into operation. The owners have endeavoured to co-ordinate district prices, but up to the present they have not succeeded. I understand that they have, at the request of the hon. Gentleman, who invited them to consider the defects of the Act, made representations that there should be some co-ordination on this question of district prices. The Miners' Federation also asked that this should be done, and I am sure my hon. Friend has read the very excellent memorandum issued by the Miners' Federation in the early part of last year. May I ask what the Minister is doing in regard to this matter. It is a long time since the owners made the representation to him. The Central Council has no power to fix prices itself, nor can they amend the prices fixed by a particular district. We claim that the central body should be given statutory powers to regulate the level of prices on a national basis. Unless this is done, there can be no assurance of effective co-ordination throughout the industry.
Then those of us who come from the exporting areas—we mention this question of the national levy with fear and trembling—believe that there should be complete co-ordination between the inland and the export trade. That is being done in those countries which are our chief competitors. Take, if you like, Poland. It can truly be said that Poland has virtually nationalised her coal-mining industry to enable her to deal effectively with the question of her export trade. She is able to compete with us for that reason, that the Government are heavily subsidising her export trade as they 477 recognise the importance of that branch of the trade. Then, if amendments are to be made in Part I, we claim that, in the interests of the industry and of the workmen, representatives of the workmen should be allowed to share with the owners the responsibility for the control and the direction of the schemes, for the wages and conditions under which the workmen are employed almost entirely depend upon the price that is paid' for the coal produced, and, therefore, it is but natural and equitable that they should have a voice in the fixing of those prices. We think that the participation of the representatives in the direction of the industry would prevent unnecessary controversy and delay and give that rapidity of decision and action upon which business so largely depends. After all, the representatives of the workmen are men of knowledge and experience of the industry who would be able to make a genuine contribution to the solution of the difficulties with which the industry is faced.
We think the Act could be strengthened so that in the inland trade a minimum delivered price should be fixed for various classes of coal in prearranged zones and so that coal is not sold in any zone below the price fixed for the particular class of coal in that zone. If properly co-ordinated and carried out, this would ensure that, as far as possible, each zone would supply its natural market and that collieries outside a particular zone would supply that zone only with coal which could not be produced from collieries within that zone. Part I has been in operation for two years of exceedingly great difficulty in the mining industry. We think it has more than justified itself. It could be strengthened as I have suggested. It should then be continued. To-day more than ever before the circumstances of the industry require that the principles of regulation and co-ordination should be rigidly applied, for to-day the surplus of productive capacity over present demand is greater than ever before. We claim that a return to the old conditions of free competition would be disastrous to the coal industry and to the country. We go further and claim that it is only by the European application of some such organisation that the coal export trade can be saved and a strong national organisation in this country, which is 478 after all the chief producing country in Europe, will be a preliminary and necessary condition of an international or European organisation.
§ 9.20 p.m.
§ Sir ADRIAN BAILLIE
I desire to support the case against the continuation of Part I of the Coal Mines Act. I have listened with considerable interest to the speech which we have just heard, and I am sure that many of the arguments that the hon. Member used for the continuation of Part I and its application to the export trade will have impressed the House, and possibly even the Secretary for Mines. He suggested, however, that the hon. Member for Consett (Mr. Dickie) was proposing the abolition of Part I in order to allow of unfettered competition in the industry. If that is the hon. Member's intention, it is not mine. I merely suggest that the restrictions imposed by Part I are not the right sort of restrictions. We were told by the Lord Privy Seal that we should not be surprised, but I was surprised until I heard the hon. Member, representing a constituency chiefly employed in the export of coal, drop the remark that Welsh anthracite demands a market. If you happen to be favoured, it is suggested that Welsh anthracite demands a market.
§ Sir A. BAILLIE
I shall be excused for not knowing the geography of that part of the country. It will be sufficient to recall the situation that occurred in the December quarter of last year, affecting the Lothian Coal Company, which had to post up notices restricting the working week to three days when all the time they had on their books orders for coal for Scandinavia. The only reason why they could not fulfil them was because they had exhausted their quota. The Scottish district had exhausted its quota, and there was not a quota available to purchase. West Fife was in the same position. To pile up injury upon injury, the company had to pay a fine for failing to fulfil their obligations. An example such as that ought to have been sufficient to convince even the most ardent supporters of the regulation of the output of coal in. this country that the particular form of regulation contained in Part I of the Coal Mines Act, 1930, is at least no better than the 479 curate's egg. When the Government interferes in such an industry as the coal mining industry, with its ramifications and its variety of conditions, interests, and requirements, then that Government or its successor should not rest content with legislation which, while admittedly satisfactory to a large part of the industry, is certainly most unsatisfactory to a minority of that industry, and a very important minority in that it is engaged in the export trade of this country.
By whom was the Act drawn up? By the late Socialist Government. Why was the Act framed and what were its objectives? I find them stated in the memorandum, which has already been referred to, which was drawn up by the Miners' Federation explaining away the Act. It states in the opening paragraph the objectives as follow:Part 1 of the Coal Mines Act, 1930, was designed to check the evils of unrestrained competition between the numerous units of the coal mining industry. Such competition has always been a source of weakness to the industry and a big factor in lowering its economic position.I have very little doubt that the framers of the Coal Mines Act, 1930, might have hoped that the Act would be a steppingstone towards nationalisation, which they always advocate on every platform but which, thank God, they have never yet been able to reach. As to their reference to unrestrained competition as a big factor in lowering the economic position, then, if nationalisation is to be the only alternative, experience shows that nationalisation has never succeeded in raising the economic position of the coal mining industry. Hon. Members will all agree that cut-throat competition is to be deprecated. If, however, it is a question of supplying co-operation instead of cut-throat competition, of supplying lubrication instead of friction, I agree, but I say that that co-operation must be based on common-sense principles, must have the willing consent of the co-operators, and must bear in mind the real interests of those concerned.
My claim and my indictment are that Part I and Part II of the Act of 1930 entirely ignore the conditions which are pre-requisite to healthy co-operation. I am supported in this, as far as I can make out, by Sir Ernest Gowers, the Chairman of the Coal Mines Reorganisa- 480 tion Commission. Speaking recently in Cardiff, he expressed considerable doubts as to the proved value of recent large amalgamations and combines, and added:Voluntary amalgamation represents an organic growth, whereas compulsory amalgamation is a surgical operation.It is an operation which unless the Ministry of Mines or this Government will intervene, will shortly take place in Scotland. It may be termed a surgical operation, but where is the anaesthetic? It will be vivisection by surgeons who, while very highly paid, are, so far as I know, inexperienced if not inexpert. I hope that, if the Government cannot intervene to stop this form of industrial brutality, they will at least see that these surgeons will only use the knife of fair play and common sense.
To return for a moment to the framers of the 1930 Act, it will not be uncharitable to assume that they and the Socialist Government were imbued with the laudable desire to protect the wages and the employment of the men in the coal mining industry. Let us see how far they have been successful. I agree with the hon. Member for Consett that all the recent troubles in the coal mining industry cannot properly be put down merely to the Coal Mines Act, 1930, but has that Act been successful in protecting the wages and conditions of employment in the industry? Speaking as to the export situation alone, I cannot give a single case where, as a result of the provisions of that Act, one miner has benefited. On the contrary, we have had the case of the Lothian Colliery Company which I quoted in my opening remarks. I am not exaggerating when I say that, since the Coal Mines Act, 1930, was introduced, 150,000 miners have lost employment. In December, 1932, there were 53,000 fewer miners on the colliery pay rolls than at the beginning of 1932, which again supports my argument. In the December quarter of 1932, on the other hand, the Scottish district was short of quota—and I would draw the attention of the hon. Member for Aberdare (Mr. G. Hall) to this—by 450,000 tons.
§ Mr. G. HALL
May I call the hon. Member's attention to the fact that almost every other coal-producing district in the country is at variance with Scot- 481 land because the Scottish owners are fixing the minimum price of that coal so that they are able to bring coal, which really ought to be used for export, inland arid sell it there? They bring it into Lancashire and Yorkshire. If Scotland would export their coal, which they ought to export, at a proper price, then they would not compete and take the coal from some of the other localities.
§ Sir A. BAILLIE
If in Scotland, as I believe to be the case, the Scottish collieries are so efficiently organised that they can sell their coal in Lancashire at a lower price than the Lancashire collieries, I have no objection. If my hon. Friend's complaint is that the minimum prices are so low in Scotland that they affect the miners' wages, then one has to look a long way to find a higher level of earnings than that in the Scottish coal mining industry.
§ Mr. DUNCAN GRAHAM
I ask the hon. Member if he will be good enough to give any evidence to justify the statement that he has now made, that the wages in Scotland are higher than they are in any other part of the country? May I further call his attention to the fact that, because of the black-legging tendencies of the Scottish coalowners, they have to work a considerable number more days per year than in any other district in the country. Take the day wage—
§ Sir A. BAILLIE
Again, that interruption only goes to confirm what I was saying. I was talking very specifically about the annual earnings, and if the hon. Member who chose to intervene just now likes to put forward the case that it is better to work fewer days in the year than more days in the year, I will give him a present of his own argument. As I was saying before I was interrupted, in the December quarter of 1932 the Scottish district was short of quota by 450,000 tons. With this position facing them, Scottish coal exporters were obliged to withold quotations. There was a definite loss of orders, but what was much worse than the loss of orders was 482 the loss of confidence of the foreign buyer in the ability of the Scottish coal owners and exporters to deliver the goods. It has been argued to-night—it is very often put forward by the protagonists of what I consider is a monstrous piece of legislation—that a district can quite easily apply to the Central Council for an extra allocation. But hon. Members must realise that in order to obtain an extra allocation a district has to put forward a very good case, and that takes time, and when that time has elapsed the damage has been done. That was the case in the December quarter of 1932 in the Scottish district. On 17th November they made application to the Central Council for an extra allocation of 450,000 tons. Consideration of the application was deferred until 24th November, when only after severe opposition from the Midland districts they were allocated 300,000 tons. As I say, by that time the damage had been done and orders had been lost. It is this lack of elasticity in the operation of those restrictions which is one of the most vicious features of this legislation. I submit that it is not beyond the perspicacity of the Secretary for Mines and the Government to realise that the operations of the quota, as far as exports are concerned, have been, and inevitably must be, to the detriment of that part of our great industry.
There is only one other point I desire to make. Reference was made just now to the question of costs. I am entitled, I think, to assume that it was hoped, through the provisions of Part I of the Act, to raise the price of coal to the consumer. I make no objection to that at all. But what happened in point of fact? In the month of October last year the average cost of production had gone up as a result of those restrictive provisions by 1s. a ton, and the average selling price in October was down by 1s. ld. a ton. There is a colliery very near to my home in Scotland, a young and efficient colliery, where they have a capacity output of 3,000 tons a day. Their standard tonnage is estimated at 2,000 tons per day. Even with the extra allocation which was accorded tc Scotland in the last quarter of 1932, that colliery is given only 77 per cent. of its standard tonnage.
§ Mr. KIRKWOOD
It depends who is speaking. If we happen to make an interjection we are out of order.
§ Sir A. BAILLIE
Perhaps I may proceed, with my hon. Friend's permission. I have named the colliery. I am only desiring to prove that even with 77 per cent. of its standard tonnage it really means that that colliery is limited to the production of 1,540 tons a day when it has a capacity of 3,000 tons. In other words, it is very little over 50 per cent. of its capacity.
§ Sir A. BAILLIE
Is it reasonable to ask a new, developing, efficient colliery like that to be restricted to 50 per cent. of the capacity of its production? I am supported by the Chairman of the Reorganisation Committee, Sir Ernest Gowers. Referring to quotas, he says:A quota system which swells the costs by making every mine work below capacity cannot be a lasting remedy.My personal feeling is that coal for export markets should, as far as possible, not be subjected to the quota. I entirely agree that there must be regulation of the output of coal for the home market, but I suggest that the quota system is not the right way to restrict output. I submit to the Minister that if curtailment is required—and I believe curtailment of production is required—it should be effected, again as hinted at by Sir Ernest Gowers, by the closing down of pits where the costs are uneconomic. That having been done, the pits with low costs should be allowed to produce to capacity. Finally, I believe that it would well repay coalowners in this country to get together and subscribe to a fund for the temporary closing down of pits with uneconomic costs. Whether they were closed permanently or temporarily would be of no real importance. 484 I said "temporarily" because of the possible increase in the demand for coal in the future. I beg of the Secretary for Mines to reconsider the case we are putting before him. I ask him to reconsider it, advisedly, because we have knocked at the door of the Secretary for Mines for many months now. We are entitled, at least, to some form of reconsideration of the case we are putting before the House to-night.
§ 9.45 p.m.
§ Mr. ROBINSON
I do not rise to Debate the general question but to refer to a matter raised by the hon. Member for Aberdare (Mr. G. Hall), namely, the determination of minimum prices under the Coal Mines Act, 1930. The hon. Member for Linlithgow (Sir A. Baillie) was not impressed by what was said by the hon. Member for Aberdare, but if he will be so kind as to listen to the remarks I have to make on the subject he may perhaps get a better impression of one of the great difficulties of the coal-mining industry. As I see it, the position is this. By Section 3 (2) of the Coal Mines Act, minimum prices are to be fixed in respect of each class of coal produced in a district. There, I think, is a fault, because the executive boards administering the district schemes can fix those minimum prices at whatever levels they wish. It seems to me that very grave difficulty arises here, because unless there is a very great amount of good will between the districts a very complex problem is bound to arise.
Right from the first there was a certain amount of difficulty with the Scottish Board. The Scottish Board failed to prepare any schedule of minimum prices, and there is no doubt that considerable pressure was required from the Central Council before a Scottish minimum price was determined. There has been still more difficulty. The Scottish people had lost a good deal of their export trade, and they looked around to find some other place where they could make up for it. In order to back themselves up in this matter they fixed their minimum prices at a level which had absolutely no relation whatever to the actual values or to the cost of production.
I wish to urge upon the Government and upon the Minister the necessity for providing some scheme whereby minimum 485 prices in the several districts can be co-ordinated, in order to eliminate unfair competition. I will bring to the attention of the House one concrete case to show what can happen. For many years the Lancashire coalfield have supplied the electricity department of the city of Liverpool with its coal. The Lancashire coalfield is, of course, at the very gate of Liverpool and anxious and eager to supply it with the whole of its requirements. Last year, however, the city of Liverpool went to Scotland and bought her coal. She got 200,000 tons of coal for her electricity department from Scotland. Our complaint is that the price which Liverpool paid for that coal was actually less than the minimum price fixed by the Lancashire district. Not only that, but the price paid must have meant a loss of shillings per ton to the coalowners who sold that coal. If you add the cost of the freightage from Scotland to Liverpool, much more loss must have resulted. I am certain that if such a situation had arisen owing to the action of a foreign country and coal or any other commodity had been sold here at a heavy loss like that, every Member of this House would have been up in arms against a flagrant case of dumping.
I want to take this opportunity of considering what this situation means to the city of Liverpool. They saved £20,000. They saved one-fiftieth of a penny per unit on the electricity they sold—a very small amount—and what is important is that it did not save them from any deficit, because the Liverpool Electricity Department has been making money for years, but that they were just seizing this opportunity of making an extra profit at the expense of the Lancashire coal mines. This action of Liverpool meant that the Lancashire district lost £102,000 more in wages last year, 880 miners were put out -of work, and 220,000 working days were lost, while the authorities of the Lancashire district had to pay out an extra £50,000 in unemployment pay. I think it is a very shortsighted policy not only from the Scottish point of view but from the point of view of the city of Liverpool.
It seems to me a very significant fact that to-morrow that same City of Liverpool is sending a deputation to this House to the Minister of Health asking that the hinterland of Liverpool, the county districts of Lancashire, should 486 join in trying to find some of the money necessary to maintain the unemployed of Liverpool. It is a very short-sighted policy on the part of the Liverpool Corporation to ruin an industry and to impoverish the people whom they are now asking to support them. I know that they are considering contracting for a further three years' supply from Scotland, and I would ask them very carefully to consider the true position and to realise what their benefit is in the matter. A similar situation has taken place in regard to Southport. Southport has taken 32,000 tons of coal from Scotland, and there has been a corresponding loss of working days in the Lancashire coalfield. Southport depends for 80 per cent. of its income on the very working men in Lancashire whom they are depriving of their jobs. At the present time in Lancashire we are starting efforts to create a better industrial situation and the miners and the coalowners are uniting in a propaganda campaign with the slogan: "Lancashire coal for Lancashire people." Why not "Lancashire coal for Liverpool people?"
§ Mr. DENVILLE
Will the hon. Member explain to the House whether Liverpool went to Scotland to get her coal, so that she could break the ring of Lancashire coalowners?
§ Mr. ROBINSON
That campaign of propaganda alone is not enough. The intention of Part I of the Act was to keep up the price of coal so that the industry could be run on a remunerative basis and that revenue might be made to provide decent wages for the men. I would plead with the Government to complete the purpose of the Act by so amending it as to provide means for the co-ordination of prices between the districts and to stop the useless, wasteful, cut-throat competition that is ruining the industry.
§ 9.53 p.m.
§ Mr. PARKINSON
The hon. Member for Widnes (Mr. Robinson) has brought 487 the Debate down to actual realities and has dealt with one of the points with which I propose to deal in the course of my remarks. The Coal Mines Act, Part I, was put into operation in order to overcome difficulties which were then operating in the national field. It was designed to check the evils resulting from unrestrained competition between numerous districts of the coal-mining industry, but we have heard sufficient to-night to realise that there are a large number of different units among the coal-owners who are acting with a view to securing their own individual prosperity. Such competition has always been a source of weakness to the industry and has had the effect of lowering the wages of the workers and weakening the structure of the industry.
We seem to forget the fact that the whole of the power with regard to the allocation is in the hands of the Central Council. We find Members of this House railing against the Government for not increasing their quota or doing something in that direction while, at the same time, the Government have not the power to do it. The power rests with the Central Council to do what they think is right in regard to the question of altering the quota. Since the War, new forces have arisen to cause a decline in the consumption of coal for heating, lighting and power, and markets have been completely reversed. Many countries have increased their own production of coal because they think it is best in the interests of their own countries to do so, instead of importing coal from other countries. I have a quotation here from a speech made by the Chairman of the Coal Mining Association of Great Britain, Mr. Evan Williams, who may be looked upon as one of the biggest figures in the coalowners association. He made a very pessimistic statement at the Central Council on 6th October. He said:We all know that instead of getting better prices than we did when we began to function under this Act, we are really getting lower prices. This is due to the facts that we have placed more coal on the market than there was a demand for, that we have not been able to co-ordinate the regulation of price as between district and district, and that we have not been able to prevent in the districts the evasions of the 488 provisions of the schemes which were designed for maintaining prices at a remunerative level.A more depressing statement could not possibly be made by a man of the standing of Mr. Evan. Williams. It shows the failure of the owners to look beyond individual interests to the well-being of the industry as a whole. It also shows the folly of placing too much coal on the market, and deals with the failure to coordinate prices or to remedy the evasions of the Act. The outstanding fact is that the predatory instincts of individual owners, or of districts, is the predominating feature. Are the coalowners not able to rise above individual interests? Are they not able to develop a collective mind? Cannot they look at the industry as a whole? Powers were given to them under the Act to enable them to restore the industry, to enable it to pull through a, very difficult period. In contradistinction to the statement of Mr. Evan Williams we have a statement from Mr. Archer, the vice-chairman of the West Yorkshire Coalowners. He says:The majority of coalowners would, think, regard the repeal of Part I with dismay, and if they do not do so initially they would eventually. The facts prove that the districts which have been really trying to work Part I have benefited, whereas those which have not done so have hurst themselves.We have heard a great deal about the difficulties which have arisen from the coalowners' point of view and from the exporters' point of view, indeed from almost every point of view. The hon. Member for Consett (Mr. Dickie) told a very dismal story. I do not know whether he was speaking on behalf of his constituents, or whether he was satisfied that the statement sent out by the exporters was meant to be a kind of manifesto for his political extinction at the next general election. I am sure that during the period during which the Coal Mines Act has been in operation we have had a steadier and stronger tendency in the trade than before. We must look at the profits which have been made on the sale of coal during the last few months. I am speaking in support of the retention of Part I. I say that it has been of service to the coal industry and to the country as a whole.
The profit on saleable coal raised in 1931 was 3.2 pence per ton; and it was 489 practically the same for 1932, though, of course, we have only the returns for the first nine months of that year. The tonnage of saleable coal was 241,000,000 tons in 1927 and 213,000,000 tons in 1931. The hon. Member for Consett tried to make out that a lower output of coal was an offence or crime against the nation. If we produced coal during one year at our maximum capacity we could not export the coal or sell it, and we should find what we used to see 25 years ago, huge stacks of coal at every pit bank.
§ Mr. DICKIE
The hon. Member must surely know that we have this state of things now. There are millions of tons of small coal lying on the ground, unsaleable.
§ Mr. PARKINSON
It is in a minor degree to what it was 25 years ago. Then, in every colliery in Lancashire you would find huge stacks of coal waiting for the highest bidder. The costs of production in 1931–32 were practically the same as in 1929–30, but they were substantially below the figures for 1927–28. The average selling price for 1931–32 was in keeping with the price for 1929–30, there was practically speaking only a few coppers difference. The output per man in 1932 increased. The production of coal in 1931 was no less than 13,000,000 tons short of the quota allowed, and in the first nine months of 1932 it was 22,000,000 less. That disposes of the question that it is necessary to have a greater quota in order to meet the difficulties of certain exporters. Workmen's wages, including allowances in kind, were practically the same as they were prior to the agreement.
The hon. Member for Consett made one or two insinuations against hon. Members on this side of the House, but I should like him to realise that, no matter what his experience may be of the coal industry, there are people on this side with equal experience, perhaps a greater experience. The Act was passed in.1930 and the allocations were made to districts. These have been varied on several occasions. Let me quote from a report issued by the Secretary for Mines. On page 5 is stated:In fixing total allocations in excess of those in any other quarter when regulation of output was operative, the Central Council doubtless desired to enable the districts to take advantage of any increased demand for coal. Demand continued to decline, however, and output, which fell short of alloca- 490 tion by 10,111,745 tons (15.07 per cent.) was 1,389,115 tons less than in the corresponding quarter of 1931, and 1,818,756 tons less than in the December quarter, 1931.The deficiency of the output as compared with the quota in the June quarter was 5.56 per cent., and in the September quarter it was 14.03 per cent. It will be understood, therefore, that. it is not a question as to the amount of coal which has been brought to the surface. There have been opportunities for these people if they had cared to utilise them. 1n connection with price regulation and coordination between districts there has been one of the glaring misapplications of the spirit of the Act. The hon. Member for Linlithgow (Sir A. Baillie) has been speaking about the position in Scotland. I would like to read a short paragraph from page 9 of the same report:Before Part I of the 1930 Act was passed, and before minimum prices were fixed, Scottish coal never came into Lancashire. Since the Act was passed, however, the Scottish coalowners or Scottish merchants have exploited the position, and large tonnages of coal from Scotland have been sold in parts of the Lancashire coalfield, depriving Lancashire collieries of valuable orders which they have enjoyed for many years. It would appear to be obvious that the minimum prices of the Scottish coal must have been fixed at a ridiculously low figure. The Lancashire owners feel very strongly that there should he amendments to Part I of the Act to enforce inter-district co-operation.Lancashire during the last year seems to have been the tipping ground for all the cheap coal of Britain. An hon. Member behind me spoke about a campaign that was being launched. I would tell the House that as much coal is coming into Lancashire from other counties and Scotland as would provide work for 4,000 miners in the Lancashire district. Though the Scottish owners may be absorbing more people in their own area, they are encroaching over the border and causing a large number of our people to be unemployed. The hon. Member for Linlithgow on two or three occasions mentioned the name of Sir Ernest Gowers. I am one of those who think that Sir Ernest Cowers would be doing a better service if he was minding his own business, and if he cannot mind his own business he had better resign his position. We know the circumstances of the appointment, but we do not want the ridicule which he is trying to pour on Part I of the Act to be continued. Really, it is unfair for 491 such a thing to take place, for a man in his position to publish such statements to the Press or to make them to individuals, and this sort of thing ought to be discontinued.
There will have to be inter-district agreements of a stronger character, and greater morality among the coalowners. It must not be a case of cut-throat competition, but of the widest co-operation possible. The hon. Member for Linlithgow spoke about Scotland being 450,000 tons over the quota during the last quarter of last year. Here are the figures I have: In the first quarter, ended March, 1932, they were 9.25 below the quota in production; in the quarter ended June they were 5.56 below; and in the September quarter they were 10.74 per cent. below the quota granted to them. It is very unfair for anyone to try to lead the House to believe that the Act has undermined the stability of a section of the industry. It has consolidated the industry. It gave to the owners all that they asked for to make their position secure, but they have so little faith in themselves or in each other that they believe they ought to continue a cut-throat competition which will lead them to the end of a very dark career. What is wanted is a better spirit in the industry. The selling side ought to have constant supervision and further reorganisation. Sound schemes for all these problems can be formulated, given the spirit of co-operation and good will among the owners. The only alternative is to drift back to the old bad conditions. The industry needs clear direction, unity of purpose and co-operation for the good of those engaged in it. Failing that, we shall be as we have been before. A return to the old conditions of free competition would be disastrous to the industry and to the country. Let me quote a few words from the League of Nations Report of January, 1932. There it is stated:National organisation is the preliminary and necessary condition of international regulations. In 1929 one of the chief obstacles to this idea was the absence of national organisation, notably in Great Britain, the chief producing country in Europe.We must either go forward with the reorganisation given under the Mines Act, or we must slide back into the abyss of which I have spoken.
§ 10.14 p.m.
§ Mr. CURRY
In the few minutes that remain I wish to express a point of view which I think has not been expressed so far in this Debate. I find myself not quite in agreement with either the hon. Member for Consett (Mr. Dickie) or the hon. Member for Aberdare (Mr. G. Hall). The hon. Member for Consett has placed us all under an indebtedness by giving us the opportunity for such a valuable discussion on such an important subject. The facts which he brought out and the views to which he and those supporting the Motion have given expression, cannot be brushed aside as the hon. Member for Aberdare tried to do by the simple statement that the administration of the Act is in the hands of the owners. It is a great surprise to me that in the case of an Act which was passed by the Labour Government we should now be told that the men have no voice in its administration. I think that position ought to be noted, because I am firmly of opinion that we shall never have permanent peace in this industry until we give those employed in it an effective voice in the fixation of quota and prices, if we are to go on fixing them.
The hon. Member for Aberdare said that we must move forward to the coordination of the export and inland areas in the country and try to get them to co-operate—as has been done, I understand, in Germany—but he rather misrepresented the hon. Member for Consett by saying that he wanted to take away some of the advantages which exporters were enjoying. The view expressed by the hon. Member for Consett was that the Act is not an advantage, but a disadvantage to the exporting industry, and the facts which have been brought out in this Debate point to the necessity for a proper Government inquiry into the working of this part of the Act. It was with that in view that I put upon the Paper an Amendment which it has not been possible for us to discuss. Much has been said on the benches opposite about the coalowners, and I detected in one or two speeches a note of cynicism in references to the coalowners. But they are not indulging in these evasions out of choice. When we were debating the Coal Mines Act last summer I called attention to a conversation which I had had with a well-known coalowner in the county of Durham who told me that that 493 week he was writing notices for some hundreds of men, not because he could not sell his coal, but because he would not attempt to sell it underneath the fixed price. All honour to that man. But in that type of man the sense of trusteeship for those whom he employs is highly developed, and it is hard on those men if they have to suffer unempolyment because of their employer's high standard of moral integrity.
§ Mr. CURRY
Certainly, but as I say if we allow to be undermined that sense of honour which has been the pride of British industry ever since ships sailed to sea—if we once lose that out of British industry, we shall have lost the foundation upon which our Imperial and commercial greatness rests. If there is even a suspicion of such a loss, then it is no answer—and I am surprised that the remark should come from the quarter from which it has come—to say that somebody else got the order. The fact that a man of the calibre of that owner should suffer economic loss because of the faults of this Act is a mandate to this House and is the strongest reinforcement possible for the request that we should have an inquiry into the working of this Act and discover the facts, and then legislate in the full light of knowledge. We should do away for ever with the sort of debate which we have had to-night in which speakers in different quarters of the House and from different parts of the country, have been giving us contradictory statements of their opinions and of the facts. We can only do it by an inquiry.
I would remind the hon. Member for Aberdare that he pointed out at great length the changes in the world conditions which have sprung up since this Act began to operate. An Act which was passed in 1930 may not be applicable to the condition of things existing in 1933. The year 1931 altered a tremendous lot of the relationships between one market 494 and another, and we should not go on, in a great industry like this, continuing an Act simply because somebody passed it or simply because it happens to fit in with a certain political faith, when we have direct evidence that it is lowering the moral standard of our commercial people, bringing unemployment in certain areas, leading to inequalities between one county and another, and generally playing ducks and drakes with an industry which is the very foundation of our commercial and industrial greatness.
§ 10.21 p.m.
§ Mr. E. BROWN
I am sure the House will agree that the hon. Member for Consett (Mr. Dickie) has raised a live issue and an issue of great interest, not merely to this House, but to the country as a whole. The only regret that the House will have is that the time has been so short that a number of Members who would wish to have made their varying contributions, for they would have been varying, have not had that opportunity. I will do my best to be as brief as I can in covering the ground, so that, if possible, when I have done, there may yet be time for some others to speak, but that I cannot promise; I will do my best. The reason I cannot promise is very obvious. My hon. Friend the Member for Linlithgow (Sir A. Baillie) said he was knocking at the door. It might be very simple if all who knocked at the door of the Minister of Mines at this time wanted the same thing, but he wants one thing, another hon. Member wants another thing, a third wants quite a different thing, and a fourth another yet again. They all knock at the door, and they all want different things; and what makes it more complicated is this, that some of them agree with each other about one thing, or two others may disagree with each other about another thing or another two things.
The result is, as the Debate has shown to-night, that this is a very difficult and complicated question, and, as I say, it is a regret that we have not had longer to consider it. Still, we must be grateful to the hon. Member for Consett for seizing the opportunity and, in his own vigorous way, putting his case. He made a quotation from a speech by me, but I think, if he re-reads it, he will see that he does me an injustice, for in that speech, so far from making the point 495 which he was making, I deliberately stated that I did not make the claim that the quota has anything to do with it. I remember the speech very well. It was the only one of that kind that I made in the course of the discussions upon that Bill, for my objections to that Bill were not objections held by many of my hon. Friends. As a matter of fact, one or two of the objections that I lodged in the course of the Debates on that Bill were sustained, and it is the fact to-day that it is possible to give adequate standard tonnages so that the developing pit can be met, because I proposed an Amendment to the Bill which in substance was accepted and is now part of the Act.
That quotation comes from a discussion two and a-half months after the Act had begun to operate, when there was the initial difficulty affecting every port in the land and, more than that, a particular colliery in South Yorkshire that had a real grievance. The committee of investigation set up to inquire into the change upheld the colliery, and so the Act was found to have the remedy for the objection then raised. If the hon. Member for Consett will re-read the whole speech, instead of looking at one quotation only, he will find that he has done me, of course without any intention, an injustice in that matter. I think, if he will also study the particular speech of the President of the Board of Trade from which he quoted, he will find that it was given in circumstances which are very interesting in view of some of the issues which are now being raised.
Now let me deal with some of the points that have been raised in this Debate. It is true, of course, that we are dealing with the operation of this Act in the present state of the coal industry, and we have to regret that we have seen a contraction in this country. Part of the troubles that we have been discussing to-night do not arise from the structure of the Act at all. They arise from the circumstances in which the Act has to be applied. Most of the Members who have discussed the operation of the quota regulations under the Act have admitted that they do not want to see the abolition of the whole of Part I. It is interesting to notice that the hon. Member for Consett himself is one of those who are inclined to say that there 496 is a case for the regulation of output and price in the inland market.
I will come back to that a little later, but I point that out now because much of the propaganda that is made against the Act is not based on any discrimination in the operation of either the regulation of output or the minimum price. It is based on the idea that all you have to do if you want to bring back health to the coal industry is to wipe the whole of the Act away. I am glad to have noticed in the Debate that that opinion does not seem to be largely adopted. That atmosphere is sometimes created even by speakers who say in the course of creating the atmosphere that they do not want to sweep Part I of the Act away. Hon. Members will have noticed that in the replies to questions which I have made I have continually told the House that every question asked about a difficulty under the operation of this Act has been analysed in my Department. Every letter that has appeared about the Act, for and against it, containing any material facts, has been analysed, and we have tried as far as we can to trace the allegations made to their sources.
It must have been borne upon the Members who have listened to this Debate that allegations are many, opinions are many, but facts are very few. We had one fact in the course of the Debate in the admirable and eloquent speech of my hon. Friend the Member for Linlithgow. It is a fact concerning a particular group of collieries. It is true, as he says, that there was a short allocation in December, 1932, but I would ask him to notice that there have only been two quarters in the whole period of the operation of the Act when there has been anything like a short allocation, and that was in each case the final quarters of the years 1931 and 1932. In the case he quoted, the case of the Lothian Coal Company, notices were issued. I took some personal interest in it, and I saw the owners concerned. The hon. Member knows quite well that 300,000 tons were first allocated, and then an additional 150,000 tons. I took the trouble to follow the thing up in regard to both West Fife and East Fife, and in regard to Lothian, and I found—[Interruption.] the particular area was concerned with the operations of the Wemyss Coal Company; that is a case which ray hon. 497 Friend had in mind. He mentioned a case that was in his own area, and I took the trouble to go into the facts. Notices were issued, the propaganda was started, the atmosphere was created, and these are the facts. The number of days worked during the week ending the 10th December in the Whitehill Pit of the Lothian Coal Company were five; for the 17th December, six; and the 24th December, six. In the week in question for which notices had been published, the number was five. For the Polton Pit, in the week ending 10th December, five days; 17th December, six days; 24th December, six days; 31st December, five days. So the notices and the facts do not agree.
With regard to the Newbattle Pit the case is rather different. In the week ending 10th December, five days, one stop day; 17th December, four days; 24th December, six days; 31st December, five days, one stop day. The stoppages came as normal in the first week in January, the New Year Scottish holidays. The practice at this undertaking was to work 11 days a fortnight, six days in one week and five in the other. Apart from the week ending 17th December, when one pit, Newbattle, worked four days, full time, allowing for holidays, had been worked during the period in question. With regard to the export trade, there is not a Member of this House, or a member of the Central Council of Coal Owners, who would put any obstacle in the way of the expansion of the export market or the fulfilment of a single order for export. I am bound to admit that in the course of my inquiries I have had a few cases put before me—cases, not assertions, which I have been able to verify. It so happens that of all the Members of the House I have been most successful in finding them. Two of about 10 were found by me in my own constituency. But when we take these dozen lost orders and compare that figure, which has been proved, with the assertions made in this Debate, the issue is a very different one. My hon. Friend the Member for West Lothian did put his finger on what is a very real difficulty when he referred to the loss of confidence among foreign buyers. There, I am bound to tell the House, he was on firmer ground, for I have got evidence that there is a feeling, whether it be justified or not, in the minds of some foreign 498 buyers that when the negotiations which are now proceeding have come to a successful conclusion, as I trust they will, it may be that they will not be able to get delivery if they place extra orders. Let the House bear that in mind in the discussion of this problem.
The hon. Member for Consett raised the very difficult question of evasions. I would point out to him that there is more than one way of looking at the problem of evasions. There are those who take the view that the way to deal with evasions is to scrap the whole Act. Others take the view that to stop evasions the thing to do is not to have fewer regulations but more regulations. The fact, alas, is a serious one, and the point put by the hon. Member for Bishop Auckland (Mr. Curry) is a serious one, too, because there can be no doubt whatever in the mind of anyone who has examined the question as to what is going on, and in a moment or two I will go so far as to give the House some instances of the methods which are adopted for evading the regulations of the Act. It is having a bad moral effect on the industry, and those responsible, the Central Council of Coal Owners or the Government—if the Government have to take action—may be led to draw very different conclusions from those drawn by people who say that what we have to do is to scrap the Act.
Let me for a minute or two deal with the problem of the foundation of the Act itself. The Act was passed for a very simple reason. I do not understand one or two of the complaints of the hon. Member for Aberdare (Mr. G. Hall) for if there are not representatives of the Miners' Federation on the board the responsibility does not lie here; it lies on the benches opposite. The Bill startled me when I saw it and for many reasons I was strongly against it in its passing. The title of the Bill said:An Act to provide for regulating and facilitating the production, supply and sale of coal by owners of coal mines;It is now too late for complaints to be made from the Opposition Benches that there is not a joint body of some kind to operate the Act. The hon. Member for Aberdare will know that it is a perfectly fair point that I am making. Responsibility is with the owners of coal, and there are often reminders of that.
499 The basis of the Coal Mines Act was a production from British mines of about 300,000,000 tons a year. At the moment there is an actual market of 209,000,000 tons a year. Up to the month of November, we feared that it would not actually reach 200,000,000 tons, but the last quarter brought the figure up to 209,000,000 tons. That is the reason why many who objected to some of the provisions of the Act do not find it possible to advocate the abolition of the Act, and do not join in the propaganda put out by some of the organisations that have been circularising hon. Members in the last two or three days.
In dealing with the Act this House has to topsider the industry as a whole—and I mean by that the miners who hew the coal and bring it to the surface, the owners who have to dispose of it and the sellers of it, either at home or abroad. More than that, the House has to bear in mind the interests of the community as a whole. I was taught when very young that when coal was sick, Britain was sick. I told some of my Danish friends the other day that when Britain is sick she does not eat bacon. Coal is sickening in this country and we cannot hope to get coal well again if we take our own point of view and try to attribute to certain things in the Act every ill that has come upon coal since the passing of the Act. It is grossly unfair to suggest that the drop in the export of coal has anything to do with the structure of Part I of the Act, excepting perhaps in a very minor degree. The hon. Member for Consett made it quite plain that he did not do that. I am now referring to certain propaganda that has gone very far and very fast in recent days. The charge that the Act is responsible for the reduction of coal exports is not only grossly unfair, but, to anybody who knows the Act, the charge is ridiculous.
What was the purpose of the Act? It was to meet a situation in which the industry does not respond to the ordinary economic test. The ordinary economic test is this: that if you produce coal, and if you can meet the demand of the consumers both in quality and in price, you can get any market in the world. Is there anybody, in this House or outside, who will contend that a mere price-cutting campaign in the export market 500 will win us back any proportion of what we have lost? The facts that have been brought forward to-night will prove the contrary. In the way he spoke of the restrictions in Germany, in France and in Belgium, I do not agree with the hon. Member for Aberdare. Hon. Members are just as unfair to the countries concerned when they say that those restrictions are due solely to tariff measures taken by this Government as are those who say that the drop in the export trade is due to the Act. I do not agree with that. I am not going to say that there may not be an element of truth in it, but I say that anyone who studies the structure of those countries will know that they are themselves coal-producing countries as well as coal-importing countries; and the real reason for the major part of these restrictions has nothing to do with the fiscal system of this country, though it may be that the fiscal system of this country will enable us in the course of our arguments to overcome that difficulty partially.
§ Mr. BROWN
We can only do as our mutual Leader used to say: we can only wait and see; and I should think that the right hon. Gentleman will be quite willing to do that, for I remember him standing in this House, not very far from where he is now, and asserting that, if we went in for a tariff, there would be a rise in the cost of living to the poorest of the poor. I think we can afford to wait and see; but I assert that, when you are dealing with restrictions in Germany, France, Belgium and Spain, you are not dealing with restrictions that have been mainly imposed for fiscal or any other reasons connected with the policy of this country. Those countries are themselves in possession of coal industries that are sick. They are coal-producing countries and they have their own difficulties. We have realised that fact, and for any person outside or inside this House to assert that merely destroying the regulations with regard to price in Part I of the Act of 1930 will win us back those markets is to assert what they will find it very difficult to prove.
§ Mr. BROWN
I am not unaware of that fact, but let me go a little further. Let me point out that the working experience of the Act has shown many things. It has shown, first of all, that it might have been good if more power had been given to the central board than was given in certain directions. I need not deal with the question of allocation except to quote one set of figures for the purpose of comparison. The allocations as regulated for the last two years have on the whole, with the exception of certain areas in. the last quarters of 1931 and 1932, been ample to meet the demand. There has been a margin, at the smallest, of 1,700,000 tons, and, at the largest, of 10,000,000 tons.
I now want to deal with the question of evasion, because this is one of the gravest issues that can be raised, and the one which, I am sure, is exercising the minds of all those concerned with the operation of the Act. Let me, without passing any comments, quote a series of the types of evasion which have come to our notice. These are examples of the evasions of the minimum price provisions that are operated in different districts. I will give the principal and most artful first. They are as follow:
There are others. I have put these on record to show to hon. Members concerned that we are not without knowledge, and to show the hon. Member that we do not need an inquiry into the matter. The only inquiry I want to have is one in every ease where anyone makes an assertion about a lost order as to where, when and how that order was lost, and I should like to have that whenever the assertion is made, because it would be very helpful in any discussion that may be forthcoming about the defects which it has been admitted in all parts of the House that the Act has.
- 1. The formation of subsidiary companies to which coal is sold at the statutory minimum price, the subsidiary companies in turn selling it at less than the minimum price, their losses being borne by the parent company.
- 2. Selling coal at prices below the minimum price ruling.
- 3. Selling more than one kind of coal at a time to one consumer, one kind at the minimum price and the other at a discount.
- 4. Selling a parcel of coal to a customer the greater part at the minimum price and the balance invoiced at a nominal price of a few pence per ton.
- 5. The payment of exorbitant remuneration to selling agents whose functions are purely nominal, to sell at prices below the minimum, making good their losses from their remuneration.
- 6. The purchase of stores from customers at inflated prices.
- 7. Coke is outside Part I of the 1930 Act.. Selling of coal and coke together,
502 the former at a minimum price, the latter at a substantial discount on the current market rate.
§ Mr. BROWN
The hon. Member wilt understand that I am not entitled, nor is anyone, to discuss legislation. That is why I put my speech in the form that I put it. Let me tell the hon. Member precisely what we have done. We have consulted all sections of the coal trade. The Mining Association informed the Government that the majority of the coalowners are in favour of the continuance of Part I and that a sub-committee has under consideration those amendments to the scheme which can be effected without fresh legislation which will secure general agreement among the coalowners to the continuance of Part I.
§ Sir H. SAMUEL
If my hon. Friend is passing away from evasions, can he tell us whether any of those evasions are legal?
§ Mr. BROWN
Some of them are evasions of the letter and some of the spirit, but it is not as easy under the structure of the Act to stop even illegal evasions as it would appear. It is one of the problems that are now exercising the minds of the Central Council. Let me make the point about the inquiry. The Miners' Federation unanimously recommended that Part I, amended and strengthened in certain directions, should continue. The Coal Merchants' Federation said it would view with regret a decision to allow the Act to lapse. The Coal Exporters' Federation urged that coal for export and bunkers should be free from the operation of the quota and 503 minimum prices. Another body representing wholesale coal merchants recommend that Part I should lapse in December 1, 1932. We have done our best to make inquiries and, more than that, the Central Council has been busily engaged discussing this issue. I think, therefore, there is no need whatever for a new inquiry in the matter.
I should like to say a word or two further about the export trade. As distinct from wild statements made in some propaganda, the Chamber of Shipping have put their view in a very moderate way. They say they are of opinion that the quota and minimum price restrictions of the Coal Mines Act had tended to hamper the export of coal and had contributed to the grave loss of employment in the coal and shipping industries. We have had a lot of figures about exports. It is true that we have lost 4,500,000 tons in 1932 as compared with 1931, but there is another remarkable fact. While in the markets to which the hon. Member referred, the coal-producing coal-consuming markets, we have losses, 1932 saw a gain in quite a number of our other markets. That is a point which, I think, the House should take into account in discussing this matter. For instance, Denmark increased her demand last year over 1931 by 505,000 tons. There were increases from Sweden, Norway, Finland, Latvia and Lithuania—none of them large, but all of them showing the new tendency in the North-West European market, and a very remarkable one.
§ Mr. BROWN
Not from Russia. Russia is one of our competitors in some of the markets in the Mediterranean, and a very serious competitor. That is the answer to some of those who say that by mere price cutting you can get markets all over the world. I think this point is one of instruction, and throws a ray of light on what can be done under the present regulations. There is a small increase in certain South American countries—in Brazil, for instance, and in Cuba. There is a very remarkable increase in Canada of 760,000 tons. The year 1932 is the largest year we have ever had in exports to Canada—1,671,000 tons. When we add these together we find that while 504 there is a loss in the markets to which the hon. Member for Aberdare referred, there is a gain of 2,579,000 tons in these other markets in 1932 over 1931. I am entitled to point out to the right hon. Member for Darwen (Sir H. Samuel) at any rate, that while there has been no agreement in the matter, and it is much too early for me to discuss the details while our customers are still in this country and we are still talking, it is quite obvious that there is a new mind in North Western Europe, and we are getting some fruit from the discussion.
Let me say a word or two on another point before I sit down. It is obvious than hon. Members in all parts of the House are uneasy lest anything should be done to hinder the export of coal. The Central Council of Coalowners have been working since the summer on Amendments to schemes which it is expected will remove, or at least reduce, some of the difficulties which schemes of regulation involve. They have not yet reached conclusions which they can place before the Government, but I wish to emphasise the point made in June by the President of the Board of Trade and my predecessor, that the administration of the schemes must be put right. That has been, in fact, the condition of the continuance of the scheme for five years. In regard to tariff negotiations with foreign countries, assurances have already been given that if there is agreement to take additional quantities of British coal, the necessary supply will be available. If those negotiations result in increased trade for British coal, I think the whole House will agree with me that it is unthinkable that the trade should be hindered through want of flexibility in the machinery of the Act. May I point out, as I did in the course of the short speech I made on the Adjournment in December, that district schemes now have the power to separate inland from export coal as a class of coal. That is now part of the machinery of the Act, and they can do it if they wish.
I would point out that one of the difficulties is that some of those who are most clamant for the removal of the restrictions on the allocation for export are just those who would most violently oppose it if it were done. The real trouble is that the knot is tied when those who have allocations for export desire to use them coastwise in the in- 505 laud market. That is the crux of the whole problem. That is why it is not as easy to solve the problem as some of our hon. Friends would suggest. It is not because it is not in the power of a district to do it, but for reasons best known to themselves and to those who have studied the structure of the Act, owners in every district have decided not to use that particular machinery.
Lancashire may have bought Scottish coal. The illustration of coal being brought from Ayrshire to Liverpool is a perfect illustration of one of the reasons why it is difficult at times to get an extra allocation for certain districts. It is very difficult to expect the representative of the inland district to vote excess allocation if he thinks that it is not to be used to send abroad, but used in competition with him in his own market at a price which may be—as I believe in this case is the fact—below the local minimum price. If you put powers into the hands of the Council to make separate allocations for inland and export coal it would then be possible to ensure that the requisite amount of coal for export could be available. I hope that the coalowners will come to an early decision on this matter. I can assure the hon. Member interested in this particular side of the subject and the House that unless the Central Council reaches a conclusion in the near future as to steps to be taken to ensure that coal for export is available, it will then be of course a question for the decision of the Government as to whether they will themselves take action in that matter.
§ Mr. BROWN
Shorter than six months, which I think the hon. Member regards as a reasonable period. In view of what is happening, I should think six months too long. With regard to the Motion and the Amendment on the Order Paper, the House will see from what I have said that I am in sympathy with elements in all of them, but I cannot accept any of them on behalf of the Government. I would, therefore, suggest as the wisest thing after this interesting and very valuable Debate, in which I regret that so many of the Members who wished to speak have been unable to take part, either the Motion should be withdrawn or we should exer- 506 cise the two minutes left for another Member to see his way to talk out the Motion.
§ 10.58 p.m.
§ Mr. MILNE
I venture to intervene in the Debate because I represent the mining constituency of West Fife which is the centre of all the trouble and has suffered more than any other district. I think I heard an hon. Member ask, "Where is West Fife?" I can tell him. West Fife is the principal exporting county in Scotland. There are collieries there mainly concerned with the export trade. They are the best equipped in the country, and the management is second to none. In spite of the facts to which I have referred, at the end of the year hundreds of men were thrown idle, not through lack of work, but as a result of the operation of an Act of Parliament. I address the House upon a mining topic with very real diffidence, because I feel that I am addressing Members, many of whom are equipped with a knowledge which I do not possess, but which I envy and respect. On the other hand, I have the advantage that I am entirely free from any prepossessions. When I entered Parliament I found the Coal Mines Act upon the Statute Book and I regard it neither with favour nor ill-will. Amidst all the welter—
§ It being Eleven of the Clock, the Debate stood adjourned.
§ The Orders of the Day were read, and postponed.