Commons Sitting of 4 May 1933

Preamble
The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.
Private Bill Petitions [Lords] (Standing Orders not complied with),
Mr. SPEAKER laid upon the Table Report from one of the Examiners of Petitions for Private Bills, That in the case of the Petition for the following Bill, originating in the Lords, the Standing Orders have not been complied with, namely:
Knutsford Light and Water [Lords].
Report referred to the Select Committee on Standing Orders.

MINISTRY OF HEALTH PROVISIONAL ORDERS (BATH AND BURY AND DISTRICT JOINT WATER BOARD) BILL,
Read the Third time, and passed.
ORAL ANSWERS TO QUESTIONS.
  UNEMPLOYMENT.

    OLD AGE PENSIONS (INSURED CONTRIBUTORS).
    Mr. BERNAYSasked the Minister of Labour whether he will take steps to inform insured contributors when they have reached the age at which they are entitled to receive old age pension, in view of the fact that persons in receipt of unemployed benefit are so informed when they become eligible for old age pension?
    The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. R. S. Hudson): Persons who are claiming benefit or transitional payments are informed when, according to the Departmental records, they are approaching the age of 65, in order that they may claim their pensions before their benefits expire; but I regret that it would not be practicable for the Ministry of Labour to give such notice to contributors generally.

    EX-SERVICE MEN, WARRINGTON.
    Mr. PARKINSONasked the Minister of Labour whether he is aware that ex-service men are being requested to bring their discharge papers to the Warrington Employment Exchange; and can he state the reason for this action?
    Mr. HUDSON: I am not aware of any special action of this kind at the Warrington Employment Exchange. Reference to discharge papers is necessary where the claimant has had no employment since discharge from the Forces, and in other cases where his service entitles him to a preference for certain kinds of employment. The procedure in this connection is the same in all Exchanges.

    TRANSITIONAL PAYMENTS.
    Mr. MANDERasked the Minister of Labour if he will consider the advisability of issuing a circular to public assistance committees to revise transitional payments without undue delay, in view of the long period during which applicants are at times kept waiting?
    Mr. HUDSON: My right hon. Friend has no evidence of such delay, and will be obliged if the hon. Member will furnish him with particulars of the cases on which he bases his question.
    Mr. MANDERasked the Minister of Labour the total cost to the State if children's allowances under the administration of transitional payments were increased from 2s. to 4s.?
    Mr. HUDSON: Owing to the operation of the needs test, any estimate of the cost of this proposal must be pure conjecture.
    Sir PERCY HARRIS: Will the hon. Gentleman try to make some conjecture of some practical kind so that we may have some guide on the matter?
    Mr. HUDSON: Any estimate I might make would be pure conjecture.
    Sir P. HARRIS: May we have the conjecture?
    Mr. HUDSON: I am sure thon hon. Member is as capable as I am of making conjectures.
    Mr. D. GRENFELL (for Mr. T. WILLIAMS)asked the Minister of Health the nature of the interview between

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    officials of his Department and the clerk to the West Riding (Yorks) County Council on 22nd March; on whose authority the interview was arranged; and why no members of the public assistance ommittee were invited to attend?
    The MINISTER of HEALTH (Sir Hilton Young): I would refer the hon. Member to the answer given to the hon. Member for Don Valley (Mr. T. Williams) on 2nd May.

    TRAINING CENTRES.
    Captain HEILGERSasked the Minister of Labour the number of residential training centres for unemployed men now in operation; the approximate number of men attending these centres; and the percentage of men for whom employment is found on leaving the centres?
    Mr. HUDSON: There are nine residential instructional centres now in operation with 1,718 men in attendance at the end of April. In addition, five residential summer camps with a capacity of 750 places will be opened during May. As was explained in the reply given to the hon. Member for Gower (Mr. D. Grenfell) on 16th March last, attendance at these centres is no longer limited to the numbers for which employment is likely to be available at the end of the course, but of the men who completed courses during the first quarter of this year, 16.5 per cent. were either placed in or found employment.
    Captain HEILGERS: Can my hon. Friend say if any increase in the number of training centres is contemplated?
    Mr. HUDSON: Yes, Sir. The increase which I have stated. It is proposed to open residential summer camps.
    Mr. LAWSON: How many camps are there to be, and how long will they last?
    Mr. HUDSON: The provision of residential summer camps is an experiment, and we are opening five this summer to see how they work. The period of opening will very largely depend on the weather, but we hope that the weather will be propitious and that we shall be able to keep them open until late in the year.
    Mr. DAVID GRENFELL: Can the hon. Member inform the House whether one of the training camps is to be provided in Wales?
    Mr. HUDSON: Not without notice.
    Mr. GRENFELL: I gave notice some time ago, and I was promised a reply. I put a question.
    Mr. HUDSON: I will certainly make inquiries and let the hon. Member know.

    MAVILLE HOSIERY COMPANY, ILKESTON (GERMAN WORKERS).
    Mr. CHARLES BROWNasked the Minister of Labour how many German workmen are now employed by the Maville Hosiery Company, Ilkeston, Derbyshire; for what periods they have been there; and for what purposes they are now employed?
    Mr. HUDSON: There are nine German workers employed under permit by the Maville Hosiery Company. One has been employed for 18 months, six for one year and two for a few weeks. They were all admitted for the specific purpose of training British workers.
    Mr. BROWN: Does the hon. Gentleman think that real efforts are being made at this factory to train British workers?
    Mr. HUDSON: That is a matter which will come up very shortly when these permits expire, and it is not the intention at present to renew all of them.

    TRADE DISPUTE, SILVERTOWN.
    Mr. THORNEasked the Minister of Labour from what Employment Exchange or Exchanges the men and youths were engaged to take the place of those in dispute at a plywood works, Silvertown, arising from the introduction of the Bedeaux system at the works; whether the applicants were informed a dispute was in progress; and what were the rates of wages they were to receive?
    Mr. HUDSON: The Canning Town Employment Exchange received from the firm notification of vacancies for skilled labourers, no rates of wages being specified, and brought this to the notice of men on the register, at the same time inform-

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    ing them, as required by the Regulations, that a dispute was in progress. The number of men engaged under this procedure was three.
    Mr. THORNE: Is it not the duty of the manager of the Employment Exchange to take steps to inform men who are required, that a dispute is in progress?
    Mr. HUDSON: Each of the applicants signed the following statement:
    "It has been explained to me that there is a trade dispute in operation at Messrs. Venesta's, Ltd. of Silvertown and I desire to be submitted to a vacancy there."
    Mr. THORNEasked the Secretary of State for the Home Department the number of police detailed for duty at the Venesta Plywood Works, Silvertown, to escort the men who have taken the place of those in dispute from the works to Silvertown station; who is responsible for the cost incurred; and what action he proposes to take in the matter?
    The SECRETARY of STATE for the HOME DEPARTMENT (Sir John Gilmour): The number of police detailed for this purpose on the 28th and 29th April was one inspector, three police sergeants, 30 police constables and two mounted police constables. On 1st May, owing to cases of assault and intimidation, this number was reinforced by the addition of two mounted men and two police cars. No special cost is involved, apart from the pay, travelling expenses and other charges in respect of the men which are borne in ordinary course by the Police Fund. With regard to the last part of the question, the police will give all necessary attention to the preservation of order and the enforcement of the law, and there is no occasion for action on my part.
    Mr. THORNE: Is it one of the duties of either the mounted police or the foot police to escort what they call the "Black stockings" in and out of the works; from their work to the railway station and vice versa?
    Sir J. GILMOUR: Oh, yes. It is the duty of the police to see that no conflicts take place which can be avoided.
    Mr. THORNE: And to march the men out of the works to the railway station?

    TRADE DISPUTE, DAGENHAM.
    Major-General Sir ALFRED KNOXasked the Home Secretary whether his attention has been drawn to the intimidation of workers by mass-picketing at the Ford motor works at Dagenham on 27th March and at the works of Briggs Bodies, Limited, at Dagenham on 30th March; and why the provisions of the Trade Disputes Act were not enforced?
    Sir J. GILMOUR: I am informed by the Commissioner of Police that the police on duty on the public roads in the neighbourhood of the Ford Works and at the works of Briggs Bodies saw no intimidation of persons desiring to work on the dates mentioned in the question. Police were present on both occasions for the purpose of preserving order and enforcing the law. The number of pickets allowed outside the works of Briggs Bodies was limited by police, but apart from that they found no ground for action under the Trade Disputes Act.
    Sir A. KNOX: Has the right hon. Gentleman seen the references in the Press which describes thousands of strike pickets who forced workers to alight from omnibuses?
    Mr. LAWSON: Is it not a fact that this dispute was settled very quickly and that the settlement reflected credit on all parties?
    Mr. PIKE: Can the Minister say if intimidation is reported by any of the victims, to whom it is reported and what act ion is taken upon it?
    Sir J. GILMOUR: I presume that if there is any complaint it is made to the police, who will properly make their report to me. I have no evidence that any complaint was made, and I prefer not to depend on newspaper reports.

    JEWISH DEMONSTRATION, LONDON.
    Mr. D. GRENFELLasked the Home Secretary whether he is aware that on the occasion of a recent Jewish demonstration in London against oppression in Germany damage was done to several motor cars waiting for their owners; and if he will make a statement on the matter

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    and explain why no action was taken by the police to prevent this damage being done?
    Sir J. GILMOUR: Inquiries have been made, but I have been unable to obtain any information as to the incident referred to in the first part of the question. If the hon. Member will furnish me with more precise particulars, I will be glad to make further inquiries.
    Mr. GRENFELL: Is the right hon. Gentleman aware that on this occasion men who were in semi-uniform went round and took the numbers of the cars of the people who were in charge of the cars, and interfered generally with people leaving the meeting?
    Sir J. GILMOUR: As I say, if the hon. Gentleman will give me any references I will make inquiries.

    CRIME (FIREARMS).
    Mr. LYONSasked the Home Secretary whether his attention has been called to the recent observations of the Recorder of London with reference to the dangerous use of a converted dummy revolver by a person convicted of a crime of violence; and what steps he proposes to take to protect the public in this respect?
    Sir J. GILMOUR: The reply to the first part of the question is in the affirmative. With reference to the second part, I am not in a position to add to the terms of the answer returned on 30th March last to a question by the hon. Member for Westhoughton (Mr. Rhys Davies) on the subject of the new legislation now under my consideration.
    Mr. LYONS: In view of the great public alarm in reference to so many acts of violence and offences in connection with the improper use of dummy firearms, will the right hon. Gentleman consider giving facilities to introduce, as soon as possible, a general Measure of reform dealing with banditry and the use of firearms in general?
    Sir J. GILMOUR: As I said in reply to a question before, a Bill for this purpose is in draft, and I am not in a position to say, in the state of Parliamentary business, when there will be time to deal with the matter?
    Mr. LYONS: While thanking the right hon. Gentleman for what he has said, may I ask whether it is possible to let the House see a copy of the Bill before the Adjournment for Whitsun?
    Sir J. GILMOUR: I will consider that matter.

    DEPORTATION ORDER (MR. OSCAR HARTZELL).
    Sir A. SHIRLEY BENNasked the Home Secretary the grounds for the deportation order made against Oscar M. Hartzell, an American subject; and what has been the result of his inquiries into Mr. Hartzell's claim to unsettled or unappropriated estate of Sir Francis Drake or his family?
    Sir J. GILMOUR: I decided in February last, on the advice of the Aliens Deportation Advisory Committee, to make a Deportation Order against Oscar Hartzell, on the ground that, as he had no genuine occupation and was holding himself out as carrying on a scheme for the recovery of the so-called Drake estate alleged to be dormant in Chancery, it was not conducive to the public good that he should be allowed to remain in this country. So far as His Majesty's Government is aware, there is no unsettled or unappropriated estate in existence which formerly belonged to Sir Francis Drake or to any member of his family.

    METROPOLITAN POLICE.
    Captain DOWERasked the Home Secretary whether his attention has been called to the statement by the Commissioner of Police of the Metropolis, in his report for 1932, to the effect that deliberate attempts have been made to stir up discontent in the force; if he can state the disciplinary action which has been taken against those responsible for.such attempts; and whether, in recent times, there has been less cause for complaint on the ground mentioned?
    Sir J. GILMOUR: Yes, Sir, but I do not think it would be in the public interest to enter into further deails on this matter at this stage. Full opportunity will be afforded at a later date for discussion of the matters raised by the Commissioner of Police in his report.
    Captain DOWER: Will my right hon. Friend bear in mind the importance of seeing that these federation boards are not permitted by means of propaganda or otherwise to endeavour to cause or foster discontent in the police force, who are a loyal body of men, second to none?
    Mr. RHYS DAVIES: Will the right hon. Gentleman tell the House whether the Government have yet considered this report? If so, have they arrived at any conclusion, and is it intended to implement the recommendations, or any part of them, by legislation?
    Mr. SPEAKER: The right hon. Gentleman says that it is not in the public interest to discuss the matter further at present.
    Mr. LANSBURY: On a point of information. Several newspapers have stated quite categorically that the Government are proposing to bring in legislation. We should like to know whether they have that intention. We are not asking to discuss the report.
    Sir J. GILMOUR: I will shortly issue, a White Paper for the information of the House and legislation, no doubt, will follow.

  HOUSING.

    TENEMENTS AND COTTAGES (COST).
    Sir FRANCIS FREMANTLEasked the Minister of Health whether, and to what extent, tenements of equally good design are dearer than cottages per square foot of floor area; what is the reason for the difference; and whether he will issue model plans and specifications to local authorities of urban areas?
    Sir H. YOUNG: Working class tenements of from three to five storeys cost ordinarily from 12s. to 15s. per square foot of floor area. The comparable figures for cottages of one or two stories are from 7s. 6d. to 9s. The difference is due largely to the greater cost of foundations and heavier construction of buildings of more than two storeys, and also to the comparatively small demand for tenements, resulting in less specialisation in this class of work. Many model plans of cottages and tenement buildings and a model specification for cottages have been issued, and
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    further plans are at present under consideration. The advice of the technical officers of the Ministry is always available to local authorities.

    TIMBER.
    Sir P. HARRISasked the Minister of Health whether he is aware that there has been a rise of about 20 per cent. in timber for house building; and whether he is doing anything to prevent such increase in the raw material of the building trade which will make it impossible to build houses for the working class without subsidies?
    Sir H. YOUNG: No, Sir, I am not aware of more than a very slight increase. I am closely watching the movements of prices.

  PUBLIC HEALTH.

    WATER SUPPLIES.
    Mr. CHORLTONasked the Minister of Health if he will report the progress made in regional water control and inter-connection of supplies, with the object of remedying suspect and inadequate supplies in certain areas?
    Sir H. YOUNG: Regional water committees have already been formed for South-West Lancashire (22 authorities), West Riding of Yorkshire (142 authorities), Sherwood Area of Nottinghamshire (24 authorities), Isle of Wight (11 authorities), Holland, Lincolnshire (12 authorities) and South Buckinghamshire (6 authorities), and the Central Advisory Water Committee is now considering where others should be formed. With the supplies of water already available for populated areas, it is not likely that many large new schemes will be required in the immediate future. Rural supplies present the greatest difficulty, and I am issuing a circular on them in the course of the next few days.
    Mr. CHORLTON: Is my right hon. Friend aware of the present scarcity in the water supply of the district of Denby Dale and also of the proposal, since turned down, for Bradford to supply Kingston-upon-Hull to obviate the need for the new supply now being applied for in respect of that town?
    Sir H. YOUNG: Yes, Sir. I am in touch with these cases, but if my hon.

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    Friend wants to make any special representations, I shall be very happy to consider them.
    Mr. D. GRENFELL: Will the right hon. Gentleman inform the House whether, in addition to negotiating with the local authorities, he will make financial provision to enable the local authorities who lack financial resources, to provide these water supplies?
    Sir H. YOUNG: It would be better if the hon. Member would await the Circular which I am about to issue.
    Mr. LEVY: Is the right hon. Gentleman satisfied that the power that his Ministry now possesses is sufficient to enable him to deal adequately with these water supplies, or does he not think that he ought to apply to Parliament for fresh legislation to give him the necessary power to deal with this urgent matter?
    Sir H. YOUNG: No, Sir. I am of opinion that the existing powers are adequate if they are properly put into force.

    DISTRESSED AREAS.
    Miss WARDasked the Minister of Health whether he will recommend to the appropriate local authorities in areas scheduled as distressed to undertake an immediate inquiry with a view to ascertaining whether there has been any material alteration in the physical condition of the unemployed and their families during the past five years?
    Sir H. YOUNG: It is already the duty of medical officers of health to acquire an accurate knowledge of all influences which may affect prejudicially the health of their areas. It is also the practice of my Department to require medical officers of health in their annual reports to draw attention to any noteworthy conditions prejudical to the health of their districts, and it is customary for school medical officers in their reports to deal with the physical condition of the child population. I do not therefore think it necessary to make any further special recommendation on this subject to the local authorities of certain areas, as suggested by my hon. Friend.
    Sir F. FREMANTLE: Will the right hon. Gentleman be able to make a defi-
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    nite statement as to the exact position with regard to this matter on the discussion on the Estimates next Monday?
    Sir H. YOUNG: When the matter is debated in the House I shall be glad to give any information that I am able on the subject.

  NATIONAL FINANCE.

    BILLS OF EXCHANGE (STAMP REVENUE).
    Mr. PETHERICKasked the Chancellor of the Exchequer if he will give the total sums collected by the inland revenue in stamps on bills of exchange in the years 1928, 1929, 1930. 1931 and 1932?
    The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain): I would refer my hon. Friend to Table 28 on page 40 of the 75th Annual Report of the Commissioners of Inland Revenue (Command Paper 4196 of 1933), which shows the receipts for the 10 years to 1931–32. The classified figures for 1932–33 are not yet ready.

    ENTERTAINMENTS DUTY.
    Mr. STOURTONasked the Chancellor of the Exchequer the yield from Entertainments Duty during the past financial year for the following admission prices: up to and including 6d., from 7d. to 1s., inclusive, from 1s. 1d. to 2s. 6d., inclusive, from 2s. 7d. to 3s. 6d., inclusive, and from 5s. and upwards?
    Mr. CHAMBERLAIN: I am afraid that the information desired by my hon. Friend cannot be given, as detailed statistics of the Entertainments Duty at the various prices of admission are not available.
    Mr. STOURTON: Can the right hon. Gentleman say approximately what proportion of the Entertainments Duty is paid on the admission prices up to sixpence?
    Mr. CHAMBERLAIN: No, Sir. As I have said, there is no division of receipts of duty from the various classes of seats.

    WAR LOAN CONVERSION (EXPENSES).
    Mr. LAMBERTasked the Chancellor of the Exchequer the amount of the expenses of the conversion of the

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    War Loan to be deducted from the increase in the nominal debt of £211,000,000 for the year 1933?
    Mr. CHAMBERLAIN: As I stated in my Budget Speech, the increase included £23,175,000 on account of the expenses of War Loan Conversion.
    Mr. LAMBERT: Can the right hon. Gentleman say what is the net nominal addition to the Debt, excluding and independent of the Loan Conversion and the Equalisation Account?
    Mr. CHAMBERLAIN: I do not like to trust my memory in regard to the figure, but I can send it to my right hon. Friend.
    Mr. THORNE: Has the right hon. Gentleman any reason to believe that those who are handling this question are charging more than trade union rates?

    IMPORT DUTIES (AGRICULTURE).
    Captain HEILGERSasked the Chancellor of the Exchequer the amount received from import duties on agricultural produce from 31st March, 1932, to 31st March, 1933?
    Mr. CHAMBERLAIN: There is no general heading in the tariff for agricultural produce as such. If my hon. and gallant Friend will let me know the particular articles or classes of article in respect of which he desires the information, I will have such figures as are available extracted.

  AGRICULTURE.

    CREDITS.
    Sir IAN MACPHERSONasked the Chancellor of the Exchequer whether, in view of the low rate of interest now payable on Government loans, he will give old borrowers under the Agricultural Credits Acts the same advantage as new borrowers and charge a rate of 3½ per cent. instead of 5 per cent. on all loans?
    Mr. CHAMBERLAIN: I would refer my right hon. Friend to the answer given by the Financial Secretary to my hon. and gallant Friend the Member for Berwick-on-Tweed (Captain Todd) on 17th November last, of which I am sending him a copy.
    Sir I. MACPHERSON: May I ask whether the Government are considering the advisability of doing this or not?
    Mr. CHAMBERLAIN: I would ask my right hon. Friend to look at the answer that I am sending to him.
    Mr. LOUIS SMITH: Is the right hon. Gentleman satisfied that farmers are obtaining the full benefit under these Agricultural Credits Acts that the Government intended they should have, and as regards the short-term credits does he not consider that amendments are urgently needed in the interests of the farmers?
    Mr. CHAMBERLAIN: I had better have notice of that question.

    EGGS (MARKING).
    Mr. LEWISasked the Minister of Agriculture for what reason British eggs which have been gas-stored have to be marked "sterilised" before being offered for sale whereas imported gas-stored eggs have not to be so marked?
    The MINISTER of AGRICULTURE (Major Elliot): By the Agricultural Produce (Grading and Marking) (Eggs) Regulations, 1930, British eggs which have been kept in chemical storage are required to be marked on the shell with the word "sterilised." This provision is operative so long as an Order in Council under Section 2 of the Merchandise Marks Act, 1926, is in force prohibiting the sale or the exposure for sale in the United Kingdom of imported eggs unless they bear an indication of origin. The object of the Regulations is to safeguard the market for home-produced fresh eggs. In the case of imported eggs it is not practicable, in the absence of international agreement, to require differentiation in marking between fresh eggs and eggs which have been preserved by various processes.
    Mr. LEWIS: Will the right hon. Gentleman consider the desirability of ceasing to require this marking in the case of native eggs on the ground that it is calculated to create prejudice against them compared with imported eggs which are not so marked?
    Major ELLIOT: Somehow or other it must be possible to distinguish between

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    stored eggs and fresh eggs, otherwise it would prejudice the case for the British fresh egg.

    MEAT (IMPORTS).
    Mr. HENDERSON STEWARTasked the Minister of Agriculture if, in view of the increase in the imports of beef, mutton, and lamb in the first quarter of 1933 over the similar period of 1932, he will state whether the quota agreements are in practice serving the purpose for which they were intended; and, if not, what further steps he proposes to take to secure to British farmers a fair price for their meat, mutton, and lamb products?
    Major ELLIOT: As regards chilled and frozen beef, the total imports from all sources during the first quarter of this year were over 7,000 tons less than in the corresponding quarter of 1932. As regards mutton and lamb, I would remind my hon. Friend that the increase in imports during the first quarter of 1933 was largely attributable to supplies from Australia and New Zealand, the arrangements with which relate to the year 1933 as a whole, and not to quarterly periods. The increased supplies from these Dominions will, therefore, be offset by smaller shipments later in the year. I am satisfied that the arrangements are proving advantageous to the livestock industry of this country.
    Mr. R. T. EVANSasked the Minister of Agriculture the quantities and values of mutton and lamb imported during the three months immediately prior to the operation of the voluntary quota; the quantities and values of imported mutton and lamb for the three months ended 30th April, 1933; and the average prices received by British farmers for sheep and lambs in these two periods?
    Major ELLIOT: According to the Monthly Accounts of Trade and Navigation for the United Kingdom, the quantity of frozen mutton and lamb imported into the United Kingdom during the three months ended October, 1932, was 1,510,697 cwts., with an average declared value of 38s. 10d. per cwt. The Monthly Accounts for last month are not yet available, but during the three months ended March, 1933, imports amounted to 1,807,554
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    cwts., with an average declared value of 45s. 4d. per cwt. During the earlier period, the price of sheep and lambs was falling, the average price of first quality sheep at the principal markets in England and Wales being 7½d. per lb. dead weight, and for lambs 8¾d. per lb.; the corresponding figures for the second period were 10½d. per lb. for sheep and 1s. 1¾d. per lb. for lambs.
    Miss HORSBRUGH: Can the right hon. Gentleman say what proportion of the meat was in wrappers made in the United Kingdom?
    Mr. R. T. EVANSasked the Minister of Agriculture the quantities and values of chilled and frozen beef imported during the three months immediately prior to the operation of the voluntary quota, and also the quantities and values of imported chilled and frozen beef for the three mouths ended 30th April, 1933; and the average prices received by British farmers for cattle in these two periods?
    Major ELLIOT: According to the Monthly Accounts of Trade and Navigation of the United Kingdom, the quantity of chilled beef imported into the United Kingdom during the three months ended October, 1932, was 2,102,072 cwts., with an average declared value of 40s. 3d. per cwt. Imports of frozen beef amounted to 915,627 cwts., the average declared value being 31s. 7d. per cwt. Monthly accounts for last month are not yet available, but during the three months ended March, 1933, imports of chilled beef amounted to 2,049,297 cwts., with an average declared value of 42s. 4d. per cwt.; imports of frozen. beef amounted to 604,330 cwts., with an average declared value of 37s. 7d. per cwt. During the earlier period cattle prices in this country were falling rapidly, the average price of first quality fat cattle at the principal markets in England and Wales in October being 39s. 2d. per live cwt., as compared with 44s. 6d. per live cwt. in the previous August. In the second period prices were steady at an average of about 42s. per live cwt.

    BACON (IMPORTS).
    Mr. R. T. EVANSasked the Minister of Agriculture the quantity and value of bacon imported during the three

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    months immediately prior to the operation of the voluntary quota; the quantity and value of imported bacon for the three months ended 30th April, 1933; and the average prices received by British farmers for pigs in these two periods?
    Major ELLIOT: According to the Monthly Accounts of Trade and Navigation for the United Kingdom, the imports of bacon into the United Kingdom during the three months ended October, 1932, were 2,859,610 cwts., with an average declared value of 57s. 6d. per cwt. The Monthly Accounts for April are not yet available, but during the three months ended March, 1933, imports amounted to 2,410,581 cwts., at an average declared value of 55s. 4d. per cwt. During the earlier period the average price of first quality bacon pigs at the principal markets in England and Wales was 9s. 8d. per score and in the later period 11s. 1d. per score.

    CHINESE EGGS.
    Mr. PIKEasked the Minister of Agriculture if lie is aware of the continued fall in wholesale prices of Chinese frozen egg and egg-pulp products, and that the prevailing prices are £33 per ton below those obtaining in December last; and if, in view of such reductions, he will take steps to afford to British producers an opportunity of fair competition upon the home market?
    Major ELLIOT: I understand that there has recently been a fall in prices of Chinese frozen liquid eggs, though in the absence of market quotations I am unable to confirm the figure referred to. My hon. Friend will be aware that under the Agricultural Marketing Bill, the Government is seeking power to regulate imports of eggs if that course is shown to be necessary to enable the reorganisation of the home industry to be fully effected under a marketing scheme. In this connection, my right hon. Friend the Secretary of State for Scotland and I have, at present, under consideration a request from the industry for the constitution of a Reorganisation Commission to prepare schemes for the marketing of eggs and poultry under the Agricultural Marketing Act, 1931.
    Mr. PIKE: Will the Minister of Agriculture bear in mind the fact that
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    the present price of the Chinese commodity in the home market is about £11 per ton below the cost of production of the British commodity with a view to giving some protection to the home producer?

  TRADE AND COMMERCE.

    TIMBER PROPS, NORWAY (IMPORT DUTY).
    Mr. SOPERasked the Financial Secretary to the Treasury whether the Import Duties Advisory Committee has reported on the question of the 10 per cent. import duty on partly squared Norway timber which is used for props and bars in coal mines; and, if so, what action he proposes to take?
    The FINANCIAL SECRETARY to the TREASURY (Mr. Hore-Belisha): The answer to the first part of the question is in the negative, and the second part therefore does not arise.

    CANADIAN TYPEWRITERS (IMPORT).
    Mr. LYONSasked the President of the Board of Trade the number of typewriters imported. from Canada for the periods of January to March, inclusive, for the years 1932 and 1933, respectively?
    The PRESIDENT of the BOARD of TRADE (Mr. Runciman): The number of complete typewriters imported into the United Kingdom and registered as consigned from Canada during the first three months of the year was 503 in 1932 and 3,602 in 1933.
    Mr. LYONS: Does not this show conclusively that the Canadian corridor is being used for bringing foreign goods into this country? May I ask whether there is any machinery at all to prevent this being done through the manipulation of values being made at the Canadian place of acceptance?
    Mr. RUNCIMAN: It is a little too early to draw exact deductions from these figures, and may I point out that the importation from all sources is less than half it was two years ago.
    Mr. LYONS: While thanking the right hon. Gentleman for the information, is it not the fact that whereas imports from foreign countries have gone down, they have increased from Canada because the foreigner is using the Canadian corridor?

    TRADE AGREEMENTS AND NEGOTIATIONS.
    Mr. LYONSasked the President of the Board of Trade with which foreign countries trade agreements and treaties are now under active consideration by His Majesty's Government?
    Mr. RUNCIMAN: Commercial agreements with Norway, Sweden and Iceland are now being prepared for signature; preparations are also being made for negotiations with Finland and the Baltic countries. Preliminary discussions have taken place with Poland.
    Mr. LYONS: As some apprehension must arise in the case of many trades, which may feel that they are to be called upon to make sacrifices under these agreements, will the right hon. Gentleman give the House an opportunity of discussing these various sacrifices before they are embodied in an agreement?
    Mr. RUNCIMAN: It is not for me to dispose of the time of the House, but, of course, everyone desires the House to see and approve these agreements.
    Mr. HALL-CAINEasked the President of the Board of Trade whether, in view of his undertaking that the views of the Import Duties Advisory Committee should be sought on questions affecting the British tariff during the trade negotiations with Norway, Sweden, and Denmark, he will state whether the committee were consulted in every case; and whether their recommendations have been adopted?
    Mr. RUNCIMAN: The Import Duties Advisory Committee were informed of the requests for tariff reductions made by Norway, Sweden and Denmark and were invited to comment on them. The negotiations were wholly conducted by the Government who, of course, assume full responsibility for the terms of the agreements.
    Mr. ARTHUR REEDasked the President of the Board of Trade whether, in view of the existence of an international cartel between the Scandinavian and other European countries for the purpose of controlling the output and prices of sulphite wood-pulp and the recent increase of over 25 per cent. in the prices of that commodity to this country, he will take steps, in negotiating trade agreements with Sweden and Norway, to safe-
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    guard United Kingdom paper manufacturers from exploitation in the purchase of their raw materials?
    Mr. RUNCIMAN: I am aware that a convention controlling the sales of sulphite wood pulp has been in existence for some years and that recently there has been some increase in the price of this commodity. With regard to the trade agreements with Sweden and Norway, I am unable to add anything to my statement made on 12th April. But I would point out that there are obvious difficulties in dealing, by means of bilateral agreements, with prices fixed internationally.
    Mr. REED: Is the right hon. Gentleman aware that during the time the prices of these raw materials have been increasing, these same countries have been importing paper made from those materials at much lower prices; and is he also aware that the paper industry of Great Britain is getting into a very difficult position?
    Mr. RUNCIMAN: I should require notice of that question.
    Major HARVEYasked the President of the Board of Trade at what figure of exchange the peso is to be taken in the payments to the United Kingdom by the Argentine Government envisaged in Article 2 of the Trade Convention between this country and the Argentine Government, dated 1st May, 1933?
    Mr. RUNCIMAN: My hon. and gallant Friend will see that the Article in question does not fix any definite rate of conversion, but as regards the bonds to he issued under the Article, it is provided that the rate of conversion end other conditions of the bonds will be agreed between the Argentine Government and a committee representative of the holders of the balances awaiting sterling exchange for remittance to the United Kingdom.
    Major HARVEY: Can the right hon. Gentleman give any definite figure as regards the 12,000,000 pesos supposed to be immediately released?
    Mr. RUNCIMAN: No, Sir, I am afraid I cannot give any definite figure.
    Mr. HAMMERSLEYasked the President of the Board of Trade whether, with a view to being in a better position

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    to safeguard the interests of the cotton trade when making trade agreements, he will set up some organisation capable of entering into undertakings which will be binding on the cotton industry as a whole?
    Mr. RUNCIMAN: As my hon. Friend knows, I am in frequent touch with those representing the cotton trade. As at present advised, I do not think that any useful purpose would be served by setting up an organisation on the lines which my hon. Friend appears to have in mind.
    Mr. HAMMERSLEY: Can the right hon. Gentleman give the House an assurance that the effect of these trade negotiations have not been disadvantageous, in respect of the cotton trade, by reason of the absence of any such organisation?
    Mr. RUNCIMAN: I think if I had time to consider that question I would probably agree.
    Mr. RHYS DAVIES: In the negotiations with these foreign countries for trade agreements does the right hon. Gentleman bear in mind the many representations made by the textile industry of Lancashire?
    Mr. RUNCIMAN: Certainly.
    Mr. HAMMERSLEY: May I take it from the right hon. Gentleman's reply that he does not think that the cotton trade could have come off better in these trade agreements if another organisation has existed?
    Mr. RUNCIMAN: If I thought they could have come off better, I certainly would not have been a party to the agreements.
    Mr. HAMMERSLEYasked the President of the Board of Trade when he will be in a position to make his promised statement relative to Japanese competition?
    Mr. RUNCIMAN: I am afraid I cannot yet give a date.
    Mr. HAMMERSLEY: Can the right hon. Gentleman give the House an assurance that in his projected negotiations with Japan, to which he referred the other day, the consideration of sharing the British market in the British Colonies
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    and Dependencies with Japan, will not be considered?
    Mr. RUNCIMAN: I think I had better wait and see the proposals put forward before I give any answer.
    Mr. MANDER: Will the right hon. Gentleman consider the advisability of placing a complete embargo on Japanese goods, in view of Japan having been found guilty of treaty-breaking?

    MOST-FAVOURED-NATION CLAUSES.
    Captain PETER MACDONALDasked the President of the Board of Trade whether he proposes to take any steps to ensure that any benefits now given to certain foreign countries by new trade treaties and agreements are not also given to all other foreign countries having most-favoured-nation clauses in their trade treaties with this country and which have not conceded anything in return for such advantages?
    Mr. RUNCIMAN: Countries entitled under existing treaties to most-favoured-nation treatment will enjoy the benefits of any reductions which are accorded by the arrangements now being negotiated, hut His Majesty's Government propose in due course to undertake negotiations with other foreign countries, and they will certainly not be prepared to continue indefinitely to accord full most-favoured-nation treatment to countries which show themselves unwilling to meet the reasonable requirements of this country in regard to the treatment of United Kingdom goods.
    Brigadier-General Sir HENRY CROFT: Can the right hon. Gentleman state how long it would take to denounce these treaties, supposing he did take action such as he has indicated?
    Mr. RUNCIMAN: I could not say without notice being given of the question.

    COTTON INDUSTRY.
    Mr. HAMMERSLEYasked the President of the Board of Trade what action he proposes to take in connection with the resolution of the Stockport Chamber of Commerce, regretting the absence of any policy or action on the part of the Government which is at all likely to bring any satisfactory measure of relief to the Lancashire cotton trade, and urging that immediate attention be given to the matter?
    Mr. RUNCIMAN: My attention has not previously been drawn to the resolution of the.Stockport Chamber of Commerce, but if my hon. Friend will arrange for a copy to be sent to me, I shall be happy to consider it.
    Mr. HAMMERSLEY: Would not some definite and precise reduction of the tariffs against manufactured British goods imported into those nations with whom we have entered into trade agreements, be more satisfactory to the Government and more in accordance with the declared policy?
    Mr. RUNCIMAN: The original question asked whether I had seen a resolution and whether I would express some opinion upon it. As I have not seen the resolution, I cannot express an opinion upon it.

    CHINA, JAPAN AND INDIA (BRITISH CAPITAL).
    Major MILNERasked the President of the Board of Trade what is the total amount of British capital invested in cotton mills, coal mines, jute works, and other industrial concerns in China, Japan and India, respectively?
    Mr. RUNCIMAN: I regret that the information for which the hon. and gallant Member asks is not available.

  GOVERNMENT DEPARTMENTS.

    MECHANISATION.
    Sir GIFFORD FOXasked the Financial Secretary to the Treasury whether he can make any statement as to the rate of mechanisation in Government offices, indicating those Departments where machines have been introduced, and the public economy which has thereby been effected?
    Mr. HORE-BELISHA: It is the policy of the Government to proceed steadily with the introduction of mechanised methods into Government Departments wherever suitable; and expert officers are available for advice in this connection. The possibility of economical use varies from the adoption of such machines on a small scale in practically all Departments, to the use of large batteries as in the Post Office, the Ministries of Health and Labour, and the Customs and Excise Department. A careful estimate
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    made in 1931 showed that, as stated by the Committee on National Expenditure, an annual saving of about £500,000 had been secured in the previous five years in some 12 of the largest Departments and while progress at this rate could hardly be maintained, further important economies have been introduced since that date.

    LAND TRANSFER (REGISTRATION OFFICIALS).
    Captain DOWERasked the Financial Secretary to the Treasury how many officials are employed in registration of transfers on the sale of land, as required under Section 28 of the Finance Act, 1931; and what has this cost the Exchequer up to date?
    Mr. HORE-BELISHA: The number of officials employed is 32. The cost to the Exchequer to date is approximately £8,000.
    Captain DOWER: Is the Financial Secretary aware that if the Government had made up their mind to repeal Part III of the Finance Act, the Land Value Tax, there would be no need to continue this wasteful expenditure?

  WASHINGTON CONVERSATIONS.

    PRIME MINISTER'S STATEMENT.
    Mr. ATTLEEasked the Prime Minister whether he is now able to make a statement in reference to the recent discussions which have taken place between the President of the United States of America, and himself?
    The PRIME MINISTER (Mr. Ramsay MacDonald): Yes, Sir. As, however, the statement is rather long, I propose, with the permission of Mr. Speaker, to make it at the close of Quesions.
    At the end of Questions,
    The PRIME MINISTER: I should imagine the House would like a statement, as brief as I can make it, of what happened during my visit to Washington.
    My conversations with President Roosevelt during the four days I was in Washington followed exactly on the lines which I indicated to this House during the Debate on the Adjournment on the 13th of last month. I was anxious first of all to ascertain the President's views upon the calling of the International

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    Economic Conference, and finding that we were in agreement, and, subsequently, that M. Herriot shared our opinion, we communicated with the organising committee, and the 12th June has been fixed for the meeting of the Conference. We discussed in some detail, as I indicated in the speech to which I have referred, the subjects which were to be brought up at the Conference. These included questions of tariff, quotas, exchange controls and stability in national currencies. A tariff truce during the sittings of the Conference was also considered. Our purpose was to ascertain by intimate discussion what the prospects were of cooperation, not to come to definite agreements. We both shared the view that our respective countries should enter the Conference, which is now to meet so soon, with hands completely untied.
    The result of these exchanges of view and examination of problems was most encouraging. In view of the controversy which has arisen with reference to the suggestion of a tariff truce, I had better say that I felt it to be my duty to point out how different is the position of a country like our own from that of those which are already high tariff countries, with policies of economic defence already fully worked out and in operation. Whilst I welcomed the idea of a truce during the period of the Conference, I made it plain that its application would have to be subject to the safeguards which this difference in our position requires. This was considered to be reasonable. I took an opportunity of putting before the President a full account of British policy on disarmament, and as the result of our discussions we reached common views which have been reflected in the effective co-operation between the British and the American delegates in support of the Draft Convention now before the Disarmament Conference at Geneva.
    We also discussed the question of debts and frankly examined the problem in all its aspects. These exchanges of view were of particular importance as they brought out in well defined detail what differences had to be reconciled not only in a final settlement but in the immediate handling of the question. On this subject I can make no fuller statement at present, as the matter has necessarily not yet reached the stage of agreement.
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    As to the visit as a whole, while I wish to convey no exaggerated impressions, I would say with confidence that the mutual understanding between ourselves and the American Government has been materially improved by the discussions which I have had with the President, for whose friendly hospitality and unreserved helpfulness throughout all our deliberations the warmest thanks of the Government are due.
    Mr. LANSBURY: I think the House will agree that the Press, as usual, has been able to anticipate the statement of the right hon. Gentleman, but I wish to ask him whether Tuesday will be convenient for him to make a fuller statement and to take the House and the country into his confidence? I understand that the right hon. Gentleman is broadcasting to-morrow night, and I want to know whether it will be convenient for him to come down to the House next Tuesday and give us a full statement of the Government's policy generally in regard to the World Economic Conference. There are many questions that I would like to add, but obviously I have no right to try to raise them now. I am sure, however, that both the House and the country will expect to hear very much more from the Prime Minister than the very meagre statement that he has just made, and I hope we may be able to discuss that statement on Tuesday, on a Supply day.
    The PRIME MINISTER: That is why the Supply day has been put down for Tuesday. I am sure that the right hon. Gentleman will help me to understand what he means by certain things that he has said to-day, by making a statement and putting questions to me on Tuesday upon the further matters about which he wishes to have information. I shall be very glad indeed to give a full reply, as fas as I possibly can, to the questions that are put and the observations that are made.
    Mr. LANSBURY: This is an extraordinary way for a Government to conduct its business. We ask what the policy of the Government is, and the Prime Minister says, "Put some questions to me." What have I to put questions to him about? I will only say now that there is no one in this House or outside who has the least idea what the right hon. Gentle-

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    man has in his mind for putting before the World Economic Conference. Our position is that the House and the country have a right to know, before the Government go into that Conference, what policy it is that the Government propose to put before the Conference and to ask the Conference to adopt. It is all very well to make a set of general statements like those we have just heard, and then for the Prime Minister to say, "Ask me questions about them." We want the right hon. Gentleman to set out the Government's policy, and then we will question him.
    Mr. LAMBERT: Will the question of War Debts come before the World Economic Conference?
    The PRIME MINISTER: No.
    Mr. HANNON: The Prime Minister told the House that we were going into the Economic Conference with our hands untied. Does he realise that the trade agreements already before the House to some extent tie our hands before we go into the Conference?
    Mr.SMITHERS rose—
    Mr. SPEAKER: It is irregular to have a Debate on the subject.
    Mr. SMITHERS: My question arises out of what has been said. May I ask the Prime Minister whether he is aware that it is quite useless to hold this Economic Conference until the question of War Debts has been settled?

    WORLD ECONOMIC CONFERENCE.
    Captain P. MACDONALDasked the Prime Minister if he can now make any statement as to the date and place of the World Economic Conference?
    The PRIME MINISTER: As has already been announced, the World Economic Conference is to meet on 12th June next in London.

    AUSTRALIA (DEFENCE).
    Captain P. MACDONALDasked the Prime Minister if he can make a statement on the proposals for a new programme of Australian naval and coastal defence which have been submitted to His Majesty's Government?
    The PRIME MINISTER: I am not in a position to make any statement on this subject.

  COAL INDUSTRY.

    CLIPSTONE COLLIERY, NOTTINGHAMSHIRE (OVERTIME).
    Mr. CHARLES BROWNasked the Secretary for Mines the number of hours overtime worked on the six conveyor faces at Clipstone Colliery, Nottinghamshire, during the months of February and March, 1933?
    The SECRETARY for MINES (Mr. Ernest Brown): I have had careful investigations made, and I understand that overtime was worked at this colliery on 16 days during February and March, 1933. The numbers of men affected varied from nine to 62 and the additional period worked from one hour five minutes to three hours 45 minutes. The total number of hours of overtime worked was 964, representing only about 0.3 per cent. of the total man-hours worked underground during this period. The working of the overtime appears to have been permissible under the terms of the Coal Mines Act, 1908.
    Mr. C. BROWN: Is the hon. Gentleman aware that men at this colliery are now under notice; and will he have some further investigation made into the regular and constant practice of this colliery of working overtime?
    Mr. E. BROWN: I have had the most careful investigations made and they prove that the overtime at Clipstone was mainly due to breakdown of conveyors, and, on three occasions, to unexpected occurrences of strong or hard coal. As the hon. Member knows, overtime is permitted under the Act in cases of accident, danger, apprehended danger, emergency or work uncompleted through unforeseen circumstances, which requires to be dealt with without interruption to avoid serious interference with the ordinary work.
    Mr. D. GRENFELL: Does the hon. Member suggest that all the operations to which he has referred fall within the category of those which permit employment for overtime?
    Mr. E. BROWN: As I say, the operations at this pit have been carefully examined, and I have given my answer that in my opinion they all arise under the Act.
    Mr. D. GRENFELL: If all these operations are to be taken into account, is it not possible for any colliery to work overtime every day in the week and all through the year?
    Mr. E. BROWN: As the hon. Member knows, the line is not always easy to draw.

    QUOTA.
    Mr. SMITHERSasked the Secretary for Mines whether he will introduce legislation to amend the Coal Mines Act so that those pits which cannot use their quota may be compelled to part with it?
    Mr. E. BROWN: I have no reason to think that the system of voluntary transfers of quota (provided for in each of the District Schemes in accordance with Section 3 (2) (e) of the Coal Mines Act, 1930) has given rise to serious abuse. I have received no representations from any executive board that an amendment such as that suggested by the hon. Member is required, and I would remind him that if such representations were made legislation would not be necessary to effect the necessary amendment in a district scheme.
    Mr. SMITHERS: Is it not the fact that some collieries could raise and sell coal at a. profit, but are unable to do so because they cannot obtain the necessary quota?
    Mr. BROWN: I should require to know the actual case in the hon. Member's mind. If he is thinking of some operations in South Wales I shall be dealing with that matter in reply to a, subsequent question.
    Mr. PIKE: Will the hon. Gentleman call for evidence as to where the pits mentioned in the question are?
    Mr. BROWN: If the hon. Member has any facts about any particular pits I shall be glad to see and consider them.
    Mr. SMITHERSasked the Secretary for Mines whether, in view of the fact that less coal is used by the Navy and that the standard tonnage of the
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    Admiralty mines is based upon a former Admiralty demand, he will take steps either to reduce the quota for the Admiralty mines or to compel those mines to part with their quota?
    Mr. E. BROWN: I think the hon. Member is under a misapprehension. The periods taken as a basis for calculating the standard tonnages of what are known in South Wales as Admiralty collieries are subsequent to 1926, by which time the heavy reduction in the coal requirements of the Navy had already taken place.
    Mr. SMITHERS: Is it a fact that these collieries refuse to part with unexpended quota?
    Mr. BROWN: I think again the hon. Member is under a misapprehension. In the South Wales coal trade the term "Admiralty colliery" means a colliery producing first-class steam coal suitable for the Navy, but not necessarily a, colliery whose output is solely or to a substantial extent used by the Navy.
    Mr. SMITHERS: Is it a fact that these collieries refuse to part with their unexpended quota? May I have an answer to that question?
    Mr. BROWN: It would depend entirely. The Act allows a voluntary sale of quota, and it is quite within the power of those who have excessive quota, if they consider that a demand is unreasonable, to refuse it.
    Mr. SMITHERS: Then may I ask—
    Mr. SPEAKER: The hon. Member has had his quota.
    Mr. SMITHERSasked the Secretary for Mines whether he is aware that the mines in South Wales have quota allocated which they cannot use, and will not sell to those mines which can produce and sell their output but are unable to obtain quota; and will he take immediate steps to see that those mines which can raise and dispose of their coals at a profit are supplied with quota to enable them to work their mines on an economic basis, and consequently to absorb unemployed miners?
    Mr. E. BROWN: I understand that the members of an organisation in the South Wales coalfield voluntarily restrict the production of their mines so far as they

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    consider necessary to bring the total output in South Wales nearer to the estimated capacity of the market than is possible under a scheme covering the whole country. Clearly they would defeat their own purpose if they were to dispose of their surplus quota indiscriminately, but I understand that, where the requests for transfer of quota have been reasonable, such transfer to mines outside the organisation has taken place. I should add that in any case I have no power to take action in the matter.
    Mr. SMITHERS: Does this not show that the whole quota system is a perfect farce?
    Mr. BROWN: The answer is "No," because if the colliery concerned thinks it is unreasonably treated, it has power to go to impartial arbitration and have its standard tonnage increased.

    MINIMUM PRICES (CO-ORDINATION).
    Mr. ROBINSONasked the Secretary for Mines whether he is yet in a position to state what steps the Government propose to take for the co-ordination of minimum prices of coal in various districts?
    Mr. E. BROWN: The Central Council are meeting on 10th May to discuss further the question of amendment of the central scheme, and the Government have agreed to wait until after that date before taking action in the matter.

  SCOTLAND.

    ANAESTHETICS, GLASGOW.
    Mr. NEIL MACLEANasked the Secretary of State for Scotland whether any record is kept of the number of operations at which anaesthetics were used in Glasgow during 1932, and, if so, whether he can state the number in which chloroform was used; the number in which chloroform and ether were used; and the number where ethyl chloride, chloroform, and ether were used?
    The UNDER-SECRETARY of STATE for SCOTLAND (Mr. Skelton): I am informed that the information asked for, if completely available, could be obtained only by a detailed examination of the records at the individual hospitals. In
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    view of the labour that would be involved in extracting the desired particulars, my right hon. Friend considers that he would not be justified in asking the hospital authorities to undertake the task.
    Mr. MACLEAN: Since there have been, in the Press in Glasgow, certain public statements as to operations under anaesthetics, will the hon. Gentleman do his best to get some form of statistics regarding these operations?
    Mr. SKELTON: I will see what can be done.

    HOUSING (RECONDITIONING) COMMITTEE.
    Commander COCHRANEasked the Secretary of State for Scotland whether he is in a position to announce the terms of reference and composition of the Departmental Committee which he proposes to set up regarding the reconditioning of working-class houses and other matters?
    The SECRETARY of STATE for SCOTLAND (Sir Godfrey Collins): The terms of reference to the committee which has now been appointed, are as follow:
    To consider and report:

    (a) What, if any, further steps are necessary or desirable to secure the maintenance of a proper standard of fitness for human habitation in working-class houses which are neither situate in an area suitable for clearance under Part I of the Housing (Scotland) Act, 1930, nor suitable for demolition under Section 16 of that Act; and

    (b) what, if any, further steps are necessary or desirable to promote the supply of houses for the working classes, without public charge, through the agency of public utility societies or other bodies subject to similar limitations, operating in particular areas or otherwise.

    Sir Thomas Whitson, ex-Lord Provost of the city of Edinburgh, has consented to act as chairman of the committee, and the other members will be:

    The hon. Member for North Aberdeen (Mr. Burnett),

    The hon. Member for Dundee (Miss Honsbrugh),

    The hon. and gallant Member for Montrose Burghs (Lieut.-Colonel C. Kerr),

    The hon. Member for Paisley (Mr. Maclay),

    Councillor A. S. McKinlay,

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    The hon. and learned Member for Stirling and Falkirk Burghs (Mr. James Reid),

    The hon. Member for the Bothwell Division of Lanarkshire (Mrs. Shaw),

    Bailie Mrs. Somerville, and

    The hon. Member for Cathcart (Mr. Train).

    PALESTINE (GERMAN JEWS).
    Mr. JANNERasked the Secretary of State for the Colonies how many Jews from Germany have been given visas for Palestine, without reference to Jerusalem, in accordance with his announcement; and will this practice be continued after the 200 certificates given to the British Consul in Berlin are exhausted?
    The SECRETARY of STATE for the COLONIES (Sir Philip Cunliffe-Lister): I understand that no details are available in the Foreign Office as regards the first part of the question, but that my right hon. Friend the Secretary of State for Foreign Affairs will make inquiry and communicate the result to the hon. Member. As regards the second part of the question, this is a matter which must be left to the discretion of the High Commissioner for Palestine. I am not aware whether he has taken a decision in the matter, but I will enquire.
    Mr. JANNER: Will the right hon. Gentleman be able to give me some information with regard to the first part of the question in a short time?
    Sir P. CUNLIFFE-LISTER: I am not sure. This is a matter for the Foreign Office to communicate about with the Embassy in Berlin, but I imagine that the information will be forthcoming in the course of a few days.

    BRITISH ARMY (RAILWAY TRAVELLING REGULATIONS).
    Lieut.-Colonel WINDSOR-CLIVEasked the Financial Secretary to the War Office whether the new regulations regarding railway travel by officers below the rank of lieutenant-colonel will apply when officers are travelling with troops?
    The FINANCIAL SECRETARY to the WAR OFFICE (Mr. Duff Cooper): Officers travelling on duty with troops wear uniform and will travel first class.
    Lieut.-Colonel WINDSOR-CLIVEasked the Financial Secretary to the War Office whether the new regulations regarding railway travel by officers below the rank of lieutenant-colonel will also apply to passages by sea?
    Mr. COOPER: No, Sir.
    Major HARVEY: Does this regulation with regard to officers who are travelling in uniform apply to the Dominions or India?
    Mr. COOPER: I do not think it applies to India.

    IMPERIAL LEGION.
    Mr. RHYS DAVIESasked the Financial Secretary to the War Office whether he is aware that a body entitled the Imperial Legion has recently been granted the use of the Stretford Road Drill Hall, Manchester, free of charge, for drilling purposes; whether this organisation is officially recognised by his Department; and whether any charge falls on the State funds in support of the organisation?
    Mr. COOPER: No organisation of this name has been officially recognised by the War Office. As regards the first part of the question, I am having inquiries made and will communicate with the hon. Member in due course.
    Mr. DAVIES: Do I understand that such an organisation exists, although it may not be recognised by the War Office; and, if so, has the hon. Member any information to show how many of these men there are throughout the country?
    Mr. COOPER: Such an organisation does exist, but I have no idea how many men belong to it.
    Mr. DAVIES: Is it proper that such an organisation can exist in this country outside what is termed "the King's uniform"?
    Mr. COOPER: We have no power to prevent such an organisation, of course.
    Mr. THORNE: Is the hon. Member not aware that the psychology of the gun is to kill; and will he not take steps to prevent any organisation having arms unless it is under the direct control of the Government?

    INDIA (PROVINCIAL ACCOUNTS AUDITS).
    Sir A. KNOXasked the Secretary of State for India if he will arrange to make available to Members the Local Audit Department Reports on the accounts of the provinces of India during the last three years?
    The SECRETARY of STATE for INDIA (Sir Samuel Hoare): Spare copies of the reports to which my hon. and gallant Friend refers are only available for the year 1930–31, and I am arranging to place a set of these in the Library of the House. If desired, I will obtain a set of the reports for the other years from India and make them similarly available on receipt.

    TREATY OF ST. GERMAIN.
    Mr. RHYS DAVIESasked the Secretary of State for Foreign Affairs, whether he is aware that Dr. Matchek, the leader of the 3,000,000 Croats within the Yugo-Slavian State, has been sentenced to three years' imprisonment for demanding from the Belgrade Government that the terms of the treaty which set up this State should be implemented; and whether, as His Majesty's Government was a party to this treaty, he will intervene on behalf of the Croats by representations to the League of Nations in order that the provisions of that treaty may be carried into effect?
    The PRIME MINISTER: My right hon. Friend has read in the Press that Dr. Matchek has been sentenced to three years' imprisonment on a charge of conducting propaganda calculated to lead to a severance of part of Yugoslavia from the State as a whole. The answer to the second part of the question is in the negative.
    Mr. DAVIES: Does the right hon. Gentleman say that, in spite of the fact that the British Government were a party to this treaty, we have nothing at all to do with the violation of the treaty by the Belgrade Government; and, if not, is there any possibility, through the League of Nations, of seeing that these treaties are implemented?
    The PRIME MINISTER: Those two supplementary questions were answered on 20th October by the Under-Secretary
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    of State, when he said that the Croats were not a minority under the terms of the treaty.

    JAPAN (NAVAL FORCES).
    Mr. MANDERasked the Secretary of State for Foreign Affairs if he has information as to the ships now being built by Japan for the Manchukuo naval forces; and whether these will be recognised as part of the naval forces of Japan.
    The PRIME MINISTER: My right hon. Friend has no information on this subject.
    Mr. MANDER: Will the right hon. Gentleman be good enough to make further inquiries, if I bring certain information to his attention?
    The PRIME MINISTER: I am sure the Foreign Office will be very glad to have the information.

    IRISH FREE STATE (PARLIAMENTARY OATH).
    Colonel GRETTON(by Private Notice). asked the Secretary of State for Dominion Affairs if his attention has been drawn to the action of the Irish Free State Government in passing the Constitution (Removal of Oath) Bill in the Dail yesterday; and if he is prepared to make a statement as to the position of the Government?
    The SECRETARY of STATE for DOMINION AFFAIRS (Mr. J. H. Thomas): Yes, Sir. I have observed the action of the Irish Free State Government and Parliament in regard to the Bill. The position of His Majesty's Government in the United Kingdom is as follows: They have throughout made clear their view that the attempt to abolish the Parliamentary Oath in the Irish Free State is in direct conflict with the obligations undertaken by the Irish Free State under the Treaty of 1921. This is confirmed by the form of the Irish Free State legislation. The Treaty is the fundamental basis of the position of the Irish Free State, and in order to achieve their object the Irish Free State Government have been compelled to include in their legislation clauses purporting not only to abolish the requirement of the

    1017
    Parliamentary Oath but also to repeal those provisions of the Constituent Act and the Constitution of the Irish Free State which set out that the Treaty has the force of law and over-riding authority in relation to the Constitution. As regards the position which arises on the passage of the legislation, His Majesty's Government in the United Kingdom consider that the passing of the Bill will not affect the duty of allegiance to the King or amount to an act of secession. They are advised that the allegiance of the members of the Irish Free State Parliament does not depend upon the swearing of the oath which by the Treaty and the Constitution they are required to take, and therefore that a failure to take the oath is not in itself a repudiation of allegiance. This does not alter the fact that in the view of His Majesty's Government in the United Kingdom the removal of the oath is a breach of the Treaty.

    INDIA (JOINT SELECT COMMITTEE).
    Sir A. KNOX: I wish to ask you, Mr. Speaker, a question of which I have given you Private Notice, whether it is in accordance with precedent that Members of a Joint Select Committee should engage in political controversy with regard to the subject of inquiry by that Committee, either on the platform or in the Press, during the period from their nomination to the Committee till its final report?
    Mr. SPEAKER: In reply to the hon. and gallant Member, it appears to me that no question of precedent can or does arise. Moreover, there are no records giving information as to the political activities of Members serving on a Joint Select Committee. Nor is it possible to lay down 'any rules for the action of Members serving on Joint Select Committees, even if it was within my province to do so. Whatever I say can only be addressed to Members of this House serving on a Committee. All I can say on the point which the hon. and gallant Member has raised is that the matter must be left to the individual discretion of Members of a Committee.
    Sir A. KNOX: With great deference, can you not, out of your wide and long experience on the subject, give some
    1018
    guidance to the House on the matter? Is it in order that a Member selected to act in a judicial capacity on a Committee of this kind should, between the sittings of that Committee, take part in political controversy on the platform on a subject that the Committee has been set up to decide?
    Mr. SPEAKER: In my somewhat long experience of matters in this House I have never come across a case where Mr. Speaker has given advice to Members serving on a Joint Select Committee, and I do not propose to do so now.

BUSINESS OF THE HOUSE.
Mr. LANSBURY: May I ask the Prime Minister the business for next week?
The PRIME MINISTER: On Monday, it is proposed to move Mr. Speaker out of the Chair on going into Committee of Supply on Civil Estimates and Estimates for Revenue Departments.
Tuesday, Supply, Committee, 4th allotted day.
Wednesday, Debate on the recent Trade Agreements.
Thursday, Second Reading of the Private Legislation Procedure (Scotland) Bill, and the Administration of Justice (Scotland) Bill; and a Motion to approve the Scottish Milk Marketing Scheme.
On any day, if there is time, other Orders will be taken.
During the week it is proposed to consider 'a Motion for an Address relating to the appointment of a Judge in the High Court of Justice (King's Bench Division), and to make further progress with the Exchange Equalisation Account Bill.
On Friday, Private Member's Bills will be considered.
Mr. LANSBURY: Will the right hon. Gentleman tell the House whether the Debate on the recent Trade Agreements will be on a Motion to approve them? I take it that the Motion to appoint a Judge in the High Court does not refer to a new appointment?
The PRIME MINISTER: That is so.
Mr. LANSBURY: With regard to the Exchange Equalisation Account Bill, I notice that the Prime Minister said that

1019
further progress will be made. The Money Resolution is being moved today and the Bill is not yet introduced. We may want some time to discuss it, and we hope that the Government do not propose to put that down late at night.
The PRIME MINISTER: There will be a discussion on it to-day on the Money Resolution, and we will see what further progress can be made during the week.
Mr. LANSBURY: It is only the Money Resolution to-day?
The PRIME MINISTER: That is so.
Captain P. MACDONALD: Which Trade Agreementss are we taking on Wednesday?
The PRIME MINISTER: We propose to take them all.
Mr. LANSBURY: What will be the Motion on Wednesday?
The PRIME MINISTER: The Adjournment of the House, which the Government will move.
Brigadier-General Sir HENRY CROFT: Will there be any opportunity on Wednesday, should the House desire, to dissent from these agreements?
The PRIME MINISTER: There are two opportunities. One is to vote against the Adjournment, and if there is a further strong feeling that the Debate should be continued, we can utilise a Supply day for that purpose.
Mr. LANSBURY: Do I understand the Prime Minister to say that in order to carry on the discussion on these Trade Agreements it will be possible on a Supply day, when we must not discuss legislation?
The PRIME MINISTER: There is no legislation. It is purely administrative.
Mr. LANSBURY: It seems to me that this is an extraordinary way of dealing with very important matters. The Government, in putting down these agreements for discussion, must have had in mind that the House may want to give a decision on the subject. If the discussion is on a Supply day, it must of necessity be much more restricted than if it is on a Motion to approve or disapprove. I should have thought that that was the best way to do it.
The PRIME MINISTER: Of course, on Wednesday the Debate will he quite open. If a Supply day is put down for the purpose of continuing the Debate, it will give the House an opportunity of coming to a decision at the end of the Debate —I say, if the House wants a further opportunity. The Chairman must decide. I cannot imagine from my experience in this House that on matters which are purely administrative—the sanctioning of agreements being an executive action, and not legislative—there will be any restriction on the Debate.
Mr. LANSBURY: I cannot accept the right hon. Gentleman's statement in regard to the agreements. The further point is that Supply days are not usually used for this sort of purpose, but for the purpose of bringing forward grievances which the Opposition desire to discuss. I am not sure that my friends here or elsewhere in the House who take our view of the subject would want to continue this discussion, but other Members on the Government side may want to do so, and I do not think that the right hon. Gentleman should seek to take away from us one of our Supply days.
The PRIME MINISTER: There must be some misunderstanding. That is not our suggestion at all. We are giving a full day to the discussion of these agreements. If the House desires a further day, we propose that it should have a Supply day. We give one day of Government time, and further time must be put down as a matter of exchange.
Sir AUSTEN CHAMBERLAIN: May I appeal to my right hon. Friend to reconsider the form in which he is going to bring this matter before the House on Wednesday? I have no idea in my mind of opposing the agreements which are then to be put before the House, but I do submit that this is not one of those occasions on which the House merely desires to have an opportunity of discussing executive action, but where the Government really feel that they need the support of the House, and the opportunity ought to be such that the House can deal with the matter effectively if it so wishes.
The PRIME MINISTER: I should imagine the House can deal quite effectively with this in the way proposed. I

1021
am sure that my right hon. Friend, with his jealousy in guarding certain executive rights, will agree that the fewer the occasions on which we submit these agreements, which are executive acts, for approval, the better for the House itself.
Sir A. CHAMBERLAIN: I understand the position of a Government who say, "We are going to maintain the prerogative of the Crown and to advise His Majesty to act upon it without consultation with the House." But when the Government think, as there has been a growing tendency on the part of all Governments to think, that His Majesty should be advised not to exercise his prerogative rights without the approval of this House, surely the occasion for discussion in this House ought to be of a character which gives the House an opportunity for effective action if it wishes to take it. Both the right hon. Gentleman and I have brought international agreements before this House and moved substantive Resolutions in regard to them.
The PRIME MINISTER: What my right hon. Friend says about what has happened occasionally at other times is perfectly right, and if he noticed the language I used he will see that I am aware of it, but we are very anxious not to make that sort thing an ordinary procedure on the part of the House, and after the Debate the other day, at which I was not able to be present, we think that the views of the House regarding these agreements can very adequately be expressed in Debate, and later on adequately expressed by a Division, should a Division be challenged.
Sir P. HARRIS: Very strong opinions on another agreement were expressed last week by a certain section of the House from which the Government gets a large part of its support. Would it not be better to give a similar opportunity next Wednesday, so that the Government can have a Vote of Confidence in their policy?
Captain P. MACDONALD: In view of the fact that the choice of subjects for a Supply day is left in the hands of the official Opposition, and not the supporters of the Government, will the right hon. Gentleman undertake to give us an adequate opportunity of discussing this subject further on another day, in case
1022
the official Opposition do not put that subject down for a Supply day?
Mr. ATTLEE: May I remind the House that, as the hon. and gallant Member has just said, a Supply day provides an opportunity for the Opposition to raise certain points on which they may wish to take a Vote. The questions that arise on these various treaties concern various trade interests, and are not at all the sort, of subject for a Supply day.
The PRIME MINISTER: I certainly was under the impression, and I have been so advised, that a Debate on Wednesday on a Motion for the Adjournment would give adequate opportunity, first of all for a full discussion, and, secondly, for an expression of views by the House in the Division Lobby.
Mr. LANSBURY: We really must clear up this point about the Supply days. So far as the Opposition are concerned, we have no desire to challenge a Debate on these agreements. We may desire to discuss them, but we are not prepared to ask for a Supply day in order that the supporters of the Government may have a vote against the Government which they are here to support.
The PRIME MINISTER: I assume that if a second day were asked for it would be asked for by the Opposition.
Sir H. CROFT: In the event of there being such opposition on Wednesday of next week, is the right hon. Gentleman prepared to say that if there is a substantial vote against the Adjournment he will consider giving another day on so very important a matter?
The PRIME MINISTER: I am afraid I cannot give any such pledge on a hypothetical question.
Sir A. CHAMBERLAIN: May I ask you a question, Mr. Speaker, on a point of Order which may help to clear up some of our difficulties? Would it be in order to move a reasoned Amendment to a Motion for the Adjournment?
Mr. SPEAKER: I should first like to see that reasoned Amendment.
Sir A. CHAMBERLAIN: Assuming the Motion for the Adjournment was made in the circumstances put by the Prime Minister, would it be in order to move as an

1023
Amendment, "That this House is unwilling to Adjourn until the Government has altered such-and-such a proposal in one of the agreements under discussion"?
Mr. SPEAKER: I should like to have time to consider that point.
Sir A. CHAMBERLAIN: I hope the Prime Minister will also take time to consider it.
Mr. AMERY: I would like to clear up one point put by the Prime Minister. He said that in the event of there being definite opposition next Wednesday he would be prepared to give another day, indicating Supply day—
HON. MEMBERS: No!
The PRIME MINISTER: No; I do not want to have any misunderstanding about this. What I did say was that if there was any need for a second day, for the Debate I was perfectly certain the Opposition would join in expressing that feeling.
Mr. AMERY: Then no further opportunity will be given unless it is asked for by those who are not particularly interested in this question?
Motion made, and Question put,
"That other Government Business have precedence this day of the Business of Supply, and that the Proceedings on Government Business be exempted, at this day's Sitting, from the provisions of the Standing Order (Sittings of the House)."—[The Prime Minister.]
The House divided: Ayes, 335; Noes, 39.

Division No. 157.]

AYES.

[4.10 p.m.

Adams, Samuel Vyvyan T. (Leeds, w.)

Cazalet, Thelma (Islington, E.)

Falle, Sir Bertram G.

Agnew, Lieut.-Com. P. G.

Cazalet, Capt. V. A. (Chlppenham)

Fermoy, Lord

Albery, Irving James

Chamberlain, Rt. Hn. Sir J. A.(Birm., W)

Flelden, Edward Brocklehurst

Allen, Lt.-Col. J. Sandeman (B'k'nh'd.)

Chamberlain, Rt. Hon. N. (Edgbaston)

Fleming, Edward Lascelles

Allien, William (Stoke-on-Trent)

Chapman, Sir Samuel (Edinburgh, S.)

Flint, Abraham John

Amery, Rt. Hon. Leopold C. M. S.

Chorlton, Alan Ernest Leofric

Foot, Dingle (Dundee)

Anstruther-Gray, W. J.

Clarke, Frank

Foot, Isaac (Cornwall, Bodmin)

Applln, Lieut.-Col. Reginald V. K.

Clayton, Dr. George C.

Forestler-Walker, Sir Leolln

Apsley, Lord

Cobb, Sir Cyril

Fox, Sir Glfford

Astbury, Lleut.-Com. Frederick Wolfe

Cochrane, Commander Hon. A. D.

Fraser, Captain Ian

Astor, Viscountess (Plymouth, Sutton)

Collins, Rt. Hon. Sir Godfrey

Fremantle, Sir Francis

Atholl, Duchess of

Coivllie, Lleut.-Colonel J.

Fuller, Captain A. G.

Baillie, Sir Adrian W. M.

Conant, R. J. E.

Ganzoni, Sir John

Baldwin, Rt. Hon. Stanley

Cook, Thomas A.

Glimour, Lt.-Col. Rt. Hon. Sir Joint

Balfour, Capt. Harold (I. of Thanet)

Cooke, Douglas

Glossop, C. W. H.

Balniel, Lord

Cooper, A. Duff

Gluckstein, Louis Halle

Barclay-Harvey, C. M.

Copeland, Ida

Glyn, Major Ralph G. C.

Barrie, Sir Charles Coupar

Courtauld, Major John Sewell

Goff, Sir Park

Beaumont, Hon. R. E. B.(Portsm'th, C.)

Cowan, D. M.

Goldle, Noel B.

Belt, Sir Alfred L.

Craddock, Sir Reginald Henry

Goodman, Colonel Albert W.

Benn, Sir Arthur Shirley

Croft, Brigadier-General Sir H.

Graham, Sir F. Fergus (C'mb'rl'd, N.)

Bernays, Robert

Crooke, J, Smedley

Granville, Edgar

Betterton, Rt. Hon. Sir Henry B.

Crookshank, Col. C. de Windt (Bootle)

Grattan-Doyle, Sir Nicholas

Blindell, James

Crookshank, Capt. H. C. (Galnsb'ro)

Gretton, Colonel Rt. Hon. John

Borodale, Viscount

Cross, R. H.

Griffith, F. Kingsley (Middlesbro', W.)

Boulton, W. W.

Cruddas, Lleut.-Colonel Bernard

Grlmston, R. V.

Bower, Lleut.-Com. Robert Tatton

Culverwell, Cyril Tom

Guinness, Thomas L. E. B.

Bowyer, Capt. Sir George E. W.

Davies, Maj. Geo. F. (Somerset, Yeovil)

Gunston, Captain D. W.

Boyce, H. Leslie

Davison, Sir William Henry

Guy, J. C. Morrison

Boyd-Carpenter, Sir Archibald

Denman, Hon. R. D.

Hales, Harold K.

Brass, Captain Sir William

Despencer-Robertson, Major J. A. F.

Hall, Capt. W. D'Arcy (Brecon)

Briscoe, Capt. Richard George

Donner, p. W.

Hamilton, Sir R.W.(Orkney & Zetl'nd)

Broadbent, Colonel John

Dower, Captain A. V. G.

Hanley, Dennis A.

Brocklebank, C. E. R.

Drewe, Cedric

Hannon, Patrick Joseph Henry

Brown, Col. D. C. (N'th'l'd., Hexham)

Duckworth, George A. V.

Harbord, Arthur

Brown, Ernest (Lelth)

Dugdale, Captain Thomas Lionel

Harris, Sir Percy

Brown, Brig.-Gen. H. C.(Berks., Newb'y)

Duggan, Hubert John

Hartington, Marquess of

Browne, Captain A. C.

Duncan, James A. L. (Kensington, N.)

Hartland, George A.

Buchan-Hepburn, P. G. T.

Edge, Sir William

Harvey, George (Lambeth, Kenn'gt'n)

Burghley, Lord

Elliot, Major Rt. Hon. Walter E.

Harvey, Major S. E. (Devon, Totnes)

Burgin, Dr. Edward Leslie

Ellis, Sir R. Geoffrey

Headlam, Lieut.-Col. Cuthbert M.

Burnett, John George

Elliston, Captain George Sampson

Heilgers, Captain F. F. A.

Burton, Colonel Henry Walter

Elmley, Viscount

Henderson, Sir Vivian L. (Chelmsford)

Butler, Richard Austen

Emmott, Charles E. G. C.

Heneage, Lleut.-Colonel Arthur P.

Butt, Sir Alfred

Emrys-Evans, P. V.

Herbert, Capt. S. (Abbey Division)

Caine, G. R. Hall-

Entwistle, Cyril Fullard

Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

Campbell, Vice-Admiral G. (Burnley)

Erskine, Lord (Weston-super-Mare)

Holdsworth, Herbert

Campbell-Johnston, Malcolm

Erskine-Boist, Capt. C. C. (Blackpool)

Hope, Capt. Hon. A. O. J. (Aston)

Caporn, Arthur Cecil

Essenhigh, Reginald Clare

Hore-Belisha, Leslie

Carver, Major William H.

Evans, Capt. Arthur (Cardiff, S.)

Hornby, Frank

Castiereagh, Viscount

Evans, R. T. (Carmarthen)

Home, Rt. Hon. Sir Robert S

Cautley, Sir Henry S.

Everard, W. Lindsay

Horobin, Ian M.

Horsbrugh, Florence

Morrison, William Shepherd

Shaw, Helen B. (Lanark, Bothwell)

Howitt, Dr. Alfred B.

Moss, Captain H J.

Shepperson, Sir Ernest W.

Hudson, Capt. A. U. M. (Hackney, N.)

Muirhead, Major A. J.

Slmmonds, Oliver Edwin

Hudson, Robert Spear (Southport)

Munro, Patrick

Skelton, Archibald Noel

Hunter. Capt. M. J. (Brigg)

Murray-Philipson, Hyiton Ralph

Slater, John

Hurd, Sir Percy

Nail-Cain, Hon. Ronald

Smiles, Lieut.-Col. Sir Walter D.

Hurst, Sir Gerald B.

Nation, Brigadier-General J. J. H.

Smith, Bracewell (Dulwich)

Iveagh, Countess of

Newton, Sir Douglas George C.

Smith. Louis W. (Sheffield, Hallam)

Jackson, Sir Henry (Wandsworth, C.)

Nicholson, Godfrey (Morpeth)

Smith-Carington, Neville W.

Jamieson, Douglas

Nicholson, Rt. Hn. W. G. (Petersf'ld)

Smithers, Waldron

Johnstone, Harcourt (S. Shields)

Normand. Wilfrid Guild

Somerset, Thomas

Jones, Lewis (Swansea, West)

North, Captain Edward T.

Somerville, Annesley A (Windsor)

Kerr, Hamilton W.

Nunn, William

Soper, Richard

Knight, Holford

Palmer, Francis Noel

Sotheron-Estcourt, Captain T. E.

Knox, Sir Alfred

Patrick, Colin M.

Southby, Commander Archibald R. J.

Lamb, Sir Joseph Quinton

Peaks, Captain Osbert

Spencer, Captain Richard A.

Lambert, Ht. Hon. George

Pearson, William G.

Spender-Clay, Rt. Hon. Herbert H.

Latham, Sir Herbert Paul

Peat, Charles U.

Stanley, Lord (Lancaster, Fylde)

Law, Sir Alfred

Petherick, M.

Stanley, Hon. O. F. G. (Westmorland)

Law, Richard K. (Hull, S.W.)

Peto, Sir Basil E. (Devon, Barnstaple)

Stevenson, James

Leckle, J. A.

Peto, Geoffrey K (W'verh'pfn, Bilston)

Stewart, J. H. (Fife, E.)

Leighton, Major B. E. P.

Pickering, Ernest H.

Stewart, William J. (Belfast, S.)

Lennox'Boyd, A. T.

Pike, Cecil F.

Storey, Samuel

Levy, Thomas

Potter, John

Stourton, Hon. John J.

Lewis, Oswald

Powell, Lieut.-Col. Evelyn G. H.

Strickland, Captain W. F.

Liddall, Walter S.

Power, Sir John Cecil

Stuart, Lord C. Crichton-

Lindsay, Noel Ker

Pownall, Sir Assheton

Sueter, Rear-Admiral Murray F.

Lister, Rt. Hon. Sir Philip Cunllffe-

Procter, Major Henry Adam

Sugden, Sir Wilfrid Hart

Lloyd, Geoffrey

Ralkes, Henry V. A. M.

Sutcilffe, Harold

Lockwood, John C. (Hackney, C.)

Ramsay, Alexander (W. Bromwich)

Tate, Mavis Constance

Loder, Captain J. de Vers

Ramsay, Capt. A. H. M. (Midlothian)

Templeton, William P.

Lovat-Fraser. James Alexander

Ramsay, T. B. W. (Western Isles)

Thomas, Rt. Hon. J. H. (Derby)

Lumley, Captain Lawrence R.

Ramsbotham, Herwaid

Todd, Capt. A. J. K. (B'wick-on-T.)

Lyons, Abraham Montagu

Rawson, Sir Cooper

Train, John

Mabane, William

Ray, Sir William

Tryon, Rt. Hon. George clement

MacAndrew, Lieut.-Col. C. G.(Partick)

Rea, Walter Russell

Turton, Robert Hugh

Mac Donald, Rt. Hon. J. R. (Seaham)

Reld, Capt. A. Cunnlngham-

Wallace, John (Dunfermline)

Macdonald, Capt. P. D. (I. of W.)

Reid, David D. (County Down)

Ward, Lt-Col. Sir A. L. (Hull)

McEwen, Captain J. H. F.

Reid, William Allan (Derby)

Ward, Irene Mary Bewick (Wallsend)

McKle, John Hamilton

Roberts, Sir Samuel (Ecclesall)

Wardlaw-Milne, Sir John S.

McLean, Major Sir Alan

Robinson, John Roland

Warrender, Sir Victor A. G.

McLean, Dr. W. H. (Tradeston)

Ropner, Colonel L,

Waterhouse, Captain Charles

Macqulsten, Frederick Alexander

Ross Taylor, Walter (Woodbridge)

Watt, Captain George Steven H.

Maitland, Adam

Ruggles-Brlse, Colonel E. A.

Wedderburn, Henry James Scrymgeour-

Makins, Brigadier-General Ernest

Runclman, Rt. Hon. Walter

Weymouth, Viscount

Mallalleu, Edward Lancelot

Runge, Norah Cecil

Whyte, Jardine Bell

Mander, Geoffrey le M

Russell, Alexander West (Tynemouth)

Williams, Charles (Devon, Torquay)

Manningham-Buller, Lt.-Col. Sir M.

Russell, Richard John (Eddlsbury)

Williams, Herbert G. (Croydon, S.)

Margesson, Capt. Rt. Hon. H. D. R.

Rutherford, John (Edmonton)

Wills, Wilfrid D.

Martin, Thomas B.

Rutherford, Sir John Hugo (Llverp'l)

Wilson, Clyde T. (West Toxteth)

Mason, David M. (Edinburgh, E.)

Salmon, Sir Isidore

Wilson, G. H. A. (Cambridge U.)

May hew, Lieut.-Colonel John

Salt, Edward W.

Windsor-Clive, Lieut.-Colonel George

Meller, Richard James

Samuel, Sir Arthur Michael (F'nham)

Wolmer, Rt. Hon. Viscount

Merriman, sir F. Boyd

Samuel, Rt. Hon. Sir H. (Darwen)

Womersley, Walter James

Mills, Sir Frederick (Leyton, E.)

Samuel, Samuel (W'dsworth, Putney)

Wood, Sir Murdoch McKenzie (Banff)

Mills, Major J. D. (New Forest)

Sandeman, Sir A. N. Stewart

Worthington, Dr. John V.

Milne, Charles

Sassoon, Rt. Hon. Sir Philip A. G. D.

Young, Rt. Hon. Sir Hilton (S'v'noaks)

Mitchell, Sir W. Lane (Streatham)

Savery, Samuel Servington

Molson, A. Hugh Elsdale

Scone, Lord

TELLERS FOR THE AYES.—

Morgan, Robert H.

Selley, Harry R.

Sir Frederick Thomson and Sir

Morris-Jones, Dr. J. H. (Denbigh)

Shakespeare, Geoffrey H.

George Penny.

NOES.

Attlee, Clement Richard

Grundy, Thomas W.

Maxton, James

Batey, Joseph

Hall, George H. (Merthyr Tydyll)

M liner. Major James

Brown, C. W. E. (Notts., Mansfield)

Hirst. George Henry

Parkinson, John Allen

Cape, Thomas

Jenkins, Sir William

Price, Gabriel

Cocks, Frederick Seymour

John, William

Salter, Dr. Alfred

Cripps, Sir Stafford

Jones, Morgan (Caerphilly)

Thorne, William James

Daggar, George

Lansbury, Rt. Hon. George

Tinker, John Joseph

Davies, David L. (Pontypridd)

Lawson, John James

Wallhead, Richard C.

Davies, Rhys John (Westhoughton)

Leonard, William

Williams, David (Swansea, East)

Dobble, William

Logan, David Gilbert

Williams, Edward John (Ogmore)

Edwards, Charles

McEntee, Valentine L.

Williams, Dr. John H. (Llanelly)

George, Major G. Lloyd (Pembroke)

McGovern, John

Graham, D. M. (Lanark, Hamilton)

Maclean, Nell (Glasgow, Govan)

TELLERS FOR THE NOES.—

Grenfell, David Rees (Glamorgan)

Mainwaring, William Henry

Mr. C. Macdonald and Mr. Groves.

Question put, and agreed to.

SIDMOUTH URBAN DISTRICT COUNCIL BILL.
Reported, with Amendments; Report to lie upon the Table, and to be printed.

STANDING ORDERS.
Resolution reported from the Select Committee;
"That, in the case of the Kingston-upon-Hull Corporation Bill, Petition for

1027
additional Provision, the Standing Orders ought to be dispensed with:—That the parties be permitted to insert their additional Provision if the Committee on the Bill think fit."

SELECTION (COMMITTEE ON UNOPPOSED BILLS) (PANEL).
Mr. William Nicholson reported from the Committee of Selection: That they had discharged the following Members from the Panel appointed to serve on the Committee on Unopposed Bills under Standing Order 111: Mr. Chotzner and Lieut.-Colonel Spender-Clay; and had appointed in substitution: Colonel Clifton Brown and Sir Geoffrey Ellis.
Report to lie upon the Table.

EDUCATION (NECESSITY OF SCHOOLS) BILL. [Lords.]
Read the First time; to be read a Second time upon Monday next, and to be printed. [Bill 96.]
DOG RACING (LOCAL OPTION) BILL.
Order [28th April] for re-committal to the former Committee in respect of new Clause read, and discharged.

MESSAGE FROM THE LORDS.
That they have agreed to,—
Housing (Financial Provisions) (Scotland) Bill, without Amendment.
That they have passed a Bill, intituled, "An Act to incorporate and confer powers on the Amersham, Beaconsfield, and District Water Company; and for other purposes." [Amersham, Beaconsfield, and District Water Bill [Lords.]

EXCHANGE EQUALISATION ACCOUNT [MONEY].
Considered in Committee under Standing Order No. 71A.
[Sir DENNIS HERBERT in the Chair.]
Motion made, and Question proposed,
"That it is expedient to increase from one hundred and fifty million pounds to three hundred and fifty million pounds the aggregate amount which may be issued to the Exchange Equalisation Account out of the Consolidated Fund."—(King's Recommendation signified.)—[Mr. Chamberlain.]
4.23 p.m.
The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain): The Resolution which I am submitting to the Committee this afternoon is in pursuance of the intention which I announced in my Budget speech last week, when I said that I proposed to ask the Committee to pass a Resolution sanctioning an increase in the resources of the Exchange Equalisation Account. I did not then mention the amount of the increase which I should propose, and in the course of the Debate which followed practically no comment was made upon my statement, with the exception of what was said by the right hon. Gentleman the Member for Darwen (Sir H. Samuel) to whose observations I shall presently return. I assume, therefore, not without reason, that what I had expressed my intention of doing did not create any great amount of apprehension. The only new fact, apart from the information which is already in the possession of the Committee, is that to-day the Committee learn from the terms of the Resolution that the amount of the proposed increase is £200,000,000; in other words it is rather more than the sum which was authorised by Sub-section (4) of Section 24 of the Finance Act last year, namely, £150,000,000, together with the assets of the old Exchange Fund amounting to another £25,000,000 which were also transferred to the account.
I take it, therefore, that what the Committee desire me particularly to put before them this afternoon is the reasons why I have fixed upon this particular sum. I should like, in the first place, to repeat what I said last week, namely, that the amount of this increase, and the fact that I am asking for an increase at
1036
all, have nothing whatever to do with the circumstance that America has gone off gold. I was sorry to see that, in spite of my emphatic statement last week, some American journals have represented this addition to the Exchange Equalisation Account as being in some way directed against their country. I do not know whether what I said on that subject, by disclaimer or anticipation of that charge, was transmitted across the Atlantic together with the statement about the intention itself. If not, I can only say that I regard it as extremely unfortunate that partial and mutilated accounts of important statements of this kind should be transmitted, and then become the foundation for misunderstanding between two great and friendly nations.
Whether my fortune will be better on this occasion than it was on the last I do not know, but, whatever happens over there, I feel sure that I can convince the Committee of the literal truth of that statement, because, in fact, this addition to the account, which we require for quite another purpose, is not one which could be used for the purpose with which I am being charged by certain American journals, namely, of forcing down the value of the £ relative to that of the dollar. The real fact is, of course, that the purpose of the fund is not at all directed to any permanent alteration in the relative exchange value of the £. The need for the increase arises out of our actual experience of the working of the account since last June. The right hon. Gentleman the Member for Darwen said in the Debate on the Budget statement on 26th April:
"The idea was that this was to be in the nature of a revolving Fund. It was not to be locked up, but was to be used when required in the purchase, and afterwards restored by the sale, of foreign currencies, or it might be of gold, with a view to levelling out the minor fluctuations of exchange, although never did it from the beginning pretend to secure complete stability irrespective of the economic forces which pull sterling this way and that."—[OFFICIAL REPORT, 26th April, 1933; col. 122, Vol. 277.]
I think that that is a very goad and accurate description of the purpose of the fund.
Let me remind the Committee of the principal forces which do pull sterling this way and that. In the first place, there are the seasonal

1037
fluctuations. Owing to a variety of causes, mostly connected with trading transactions, we find that the £ is strong in the spring and weak in the autumn, and, if those fluctuations were left entirely to themselves, we should have a sort of see-saw in the value of the £, which, undoubtedly, would be disturbing and embarrassing to traders generally. But those fluctuations, which have gone on for a great many years—I do not mean fluctuations in the £, but the forces which tend to cause those fluctuations —are now considerably reinforced by the action of speculators, who watch for these rises and falls, who know about the time when they are coming, and who operate for the purpose of making a profit, but whose operations naturally amplify, if I may use that term, the ordinary variations which are due to these seasonal causes; so that, by reason of the operations of speculators, we find that the tendency of the £ to be strong is accentuated in the spring, and, similarly, these forces tend to pull the £ down still more in the autumn. Accordingly, it seems only a natural and reasonable and common-sense precaution to build up resources in the spring in order that we may, if possible, stem a too rapid fall in the autumn.
If that were all that we had to deal with, I think that probably the £150,000,000 with which we started would have, been ample for our purpose—the purpose, that is, of evening out these seasonal variations in the value of the £. But, as I explained to the Committee last week, we have, since we started the Account, been faced with a new phenomen, something which we had not anticipated at all, something quite unexpected, something which I might perhaps describe as the presence of refugee capital—capital which has come here because the owners of it had got alarmed about conditions in their own countries, and had come to the conclusion that, for the time at any rate, their capital was safer in London than in any other place. If that were a, permanent settlement here, we should not require additions to the Exchange Account; we could probably deal with it. Again I want to say that it is not our intention to use this fund to try to alter the permanent level of the exchange, either up or down. For one thing, I do not think we could; cer-
1038
tainly we could not be sure of being able to do it, even if we tried; but, in the case of this particular phenomenon which I have called the flight of refugee capital to London, we must recognise that its habitation here is of an entirely temporary character. It arises out of a sort of minor panic, and, when that panic has come to an end, when confidence has been restored, it is quite likely that this capital will go back to the places from which it came, and it certainly will be encouraged to do so if the owners of it think that by so transferring it they have an opportunity of making a profit out of their own currency.
Mr. WALLHEAD: Can the right hon. Gentleman tell us how much there is of it?
Mr. CHAMBERLAIN: No, I cannot tell how much there is of it. It varies at different times, and I do not think it would be in the public interest to give figures in this matter, because the hon. Member will appreciate that the figures which I might give would not be confined to hon. Members in this House; they would be made public to all the world, and all the speculators in the world would have additional information, which is exactly what they want for the purpose of their operations. I say, therefore, that what we have to consider is that this flight of capital which has come to this country under these special circumstances is something which we cannot count on remaining here. It may go at any time, and, when it goes, unless we have some special means of dealing with the situation, it may have very disturbing effects upon the exchange. It is because this new phenomenon, which, of course, occurred long before America went off gold, did result in our resources being reduced to a level which was distinctly uncomfortable at times during the last 12 months—it was on that account that long ago, last year or at the beginning of this year, I made up my mind that, when the Budget came round again, I should have to ask the Committee to increase the resources at our disposal if we were to operate successfully.
I repeat once more that we want the Exchange Account for smoothing out the variations in exchange caused by three sets of phenomena—first, the seasonal

1039
fluctuations; secondly, the operations of speculators, which increase those seasonal fluctuations, and other fluctuations, too; and, thirdly, this special flight of capital from other countries for the sake of finding a safer place to stop in for a time. I think the Committee will probably agree that our objects in trying to counteract these movements are praiseworthy. I think they will probably agree, also, that, so far as we have gone, the Work of the Exchange Account has been beneficial to the traders of this country in preserving a reasonable stability in the exchange. I think they will very likely accept my word for it that, in order to operate this Account satisfactorily, we ought to have some further addition to our resources; but I think they may well ask why I am asking for such a large addition—why we want to double them, and rather more than double them.
Referring again to the words of the right hon. Gentleman the Member for Darwen, I assume that, when he talked about this being a revolving account, he had some idea in his mind that, if it were a revolving fund, there was not, on the face of it, any reason for very much increasing it. Of course, he is quite right in saying that it is a revolving fund, but the interval required for a. revolution may be a considerable one, and, in the meantime, the movements which we have to counteract are, I fancy, of a very much greater extent than, perhaps, the right hon. Gentleman has fully appreciated. As I said before, I do not want to give figures, but I ask the Committee to believe that they are very considerable. Perhaps I might remind the Committee that, in a recent report of the Bank for International Settlements, it was estimated that the amount of short-term capital available at the beginning of 1931 had reached the large total of £22,000,000,000.
Sir HERBERT SAMUEL: All over the world.
Mr. CHAMBERLAIN: Of course, although the right hon. Gentleman says, "All over the world," I am sure he appreciates that it moves from one part of the world to another. I do not want the Committee to suppose that I think there is that amount of international
1040
short-term capital about now all over the world. No doubt those were exceptionally large figures, and I only mention them to show the order of the quantity of short-term capital which has been available in the past; but I can tell the Committee that I am quite sure it is still very large indeed.
I want to be perfectly frank with the Committee about the figure that I am asking them to sanction. I think it is impossible to state with any confidence that any given figure will put us in a position to be absolutely sure that we can deal with the situations that may arise. We are living in such extraordinarily unique and abnormal times. Things happen to-day which never happened before; things may happen tomorrow which we have not thought would be likely to happen to-day; and one cannot be absolutely certain that, even now, we have got to the end of the unexpected movements which may happen, in this disturbed condition of the world, to cause the exchange rate of the to move up or down in this temporary fashion.
I gave long consideration to the question of how much I ought to ask for as an addition. My thoughts ranged from an addition of £100,000,000 on one side to £250,000,000 on the other. I came to the conclusion that £100,000,000 was definitely too little. On the other hand, £250,000,000 seemed to me unnecessarily large, so far as one could foresee the future or think of any possible circumstances that might arise. I can assure the Committee that I have not wanted to ask for unnecessarily large figures, for I realise that, the larger the figure, the more likely are suspicions to be aroused that in fact there is some other motive behind these requests than that which is given. Therefore, I had no intention of putting the figure unnecessarily high. Then I fluctuated between £150,000,000 and £200,000,000. On the whole, I came to the conclusion that £150,000,000 would be fairly safe. For some time I thought I could confine myself to £150,000,000. But there was one consideration which occurred to me which finally brought me to the other conclusion. I cannot keep on returning to Parliament and asking the House to sanction another and another addition to the resources of the fund. When we

1041
established this fund last year, we had no experience at all to guide us; we had to make a pure guess at what amount would be necessary for our operations. I must say I do not think it was a bad guess. It has carried us through the year, and, if it had not been for these new circumstances which I have described, I think we might have stood upon that.
But, if I confined myself now to £150,000,000, and if something else arose which showed me that we had not enough, and that another £50,000,000 would have put us safe, of course that would have meant, either that I must give up the idea of the working of the fund, or that I must come back a third time to the House of Commons and ask the Committee to sanction another addition. I felt that to be a very undesirable proceeding. On the whole, therefore, that was the conclusion to which I came, that rather than take that risk I would go to the higher figure and ask the Committee to sanction it. While, naturally, I cannot definitely give a pledge that I shall never come here again, to the best of my knowledge and belief this £200,000,000 gives us an adequate margin for all that we shall want to do, and I have no expectation that I shall have to come to the Committee and ask for any further sum.
There is only one other thing about which I want to say a word, and that is the question of profit or loss. The right hon. Gentleman the Member for Darwen asked me some question about that during the Budget statement and the right hon. and gallant Gentleman the Member for Newcastle-under-Lyme (Colonel Wedgwood) spent some time in his comments last week in speculating about what profit or loss had been made by the fund. I was filled with admiration at the confidence with which he told the Committee what had been the result of the transactions of the Exchange Equalisation Account. Of course, the Committee realises that there is no profit or loss in fact until the fund is finally wound up. You can make a valuation at any moment or say that, if we were to wind it up, we should have made this profit or that loss, but a final account cannot be struck until the fund comes to an end. As a matter of fact, as I thought it was desirable that the Committee should not be under any apprehension which was not well-founded,
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I had a valuation made and the Financial Secretary was able to tell the Committee that two days before he was speaking there had not been any loss on the account at all, but that the balance was on the right side.
Mr. SAMUEL SAMUEL: Subject to realisation.
Mr. CHAMBERLAIN: Entirely. That, I think, shows that the operations of the Account have been conducted with great skill. But do not let us fall into the error made by the right hon. and gallant Gentleman the Member for Newcastle-under-Lyme that the one thing that those who are operating the Account keep in their mind all the time is, Are we making a profit or a loss?. I do not mean to say that they exclude from their mind the possibility that the result of the transactions might in certain circumstances result in a loss or a profit, but that is not the thing that is in their mind as they are operating from day to day. What they are thinking of is the purpose of the Fund, namely, to prevent the exchange moving rapidly up and down. If hon. Members will keep that in mind and at the same time bear in mind that, as a matter of fact, all these operations have been carried on throughout the year without landing the Exchequer in any ultimate loss subject to realisation, I think they will have a certain confidence that we can be trusted to deal with even the larger sum for which I am asking sanction.
4.51 p.m.
Sir STAFFORD CRIPPS: The right hon. Gentleman suggested that during the Budget Debate there were no objections to this course, except by the right hon. Gentleman the Member for Darwen (Sir H. Samuel), but we rather left it to be discussed on this occasion, which seems a more appropriate one to go into a matter of this kind. I should like to start by congratulating the right hon. Gentleman on his conversion to Socialism. He has at last discovered that the proper way of using money of this sort is not for making profits, which is the usual manner in which it is used by bankers and other people, but to use it in the general interest of the country, whether there be a profit or a loss, and we certainly desire to commend him very highly for that very right and proper point of view when dealing with a Fund of this

1043
sort. It shows, perhaps, that it is a good thing that the Fund should be in the hands of the Central Government and under their control, rather than in the hands of any private corporation to undertake speculation in exchange in such a way as they desire. But, of course, this addition of £200,000,000 is a very large one and is setting up an enormous Fund, to which is attached a very large risk because, whatever the results may be, obviously when the Fund is wound up it will depend upon many features and many factors as to whether the right hon. Gentleman has a very nice nest-egg to dispose of or whether he finds an extremely bare nest, which is a loss of capital. [Interruption.] He thinks he may not be there. That depends upon when he winds it up, of course. The temptation to a Chancellor of the Exchequer to wind up a fund of this sort, in which he might find enough to give two or three shillings off the Income Tax, or something of that sort, would be enormous.
The Fund, as I understand it now, is being increased for the purpose of counteracting the movements of this floating fund which has been going about the world ever since the currencies went off gold trying to find the place where it can make the greatest profit on short time transactions and where it inconveniences national currencies to the maximum extent. It is a fund which has been rumoured and reported to be somewhere between £250,000,000 and £500,000,000, and which in its turn has inconvenienced most of the capitals of Europe, and America, too. Surely, the right hon. Gentleman, when he is looking around for something to tax, might consider taxing the import of such a fund as this which is highly undesirable. No one wants it. It is such a danger that we have to raise a. loan, or issue Treasury Bills, to the extent of £200,000,000 in order to combat it. Could not the right hon. Gentleman devise some scheme by which he could keep it out by taxation, and then we should get over all this great contingent liability, and, if any portion of it did come in here, he would at least be able to get a nice little bit for the Exchequer out of it. Everyone admits that a fund of this sort is undesirable. It is not useful money in the sense of being money
1044
that is useful for industry or for industrial capitalisation or for short-term loans to industries. It is money that is put here in the financial centre and is merely used for financial purposes which are not only not a benefit but are a real danger to the whole financial system.
When this scheme came forward last year, we took the view that it was desirable, if there was going to be exchange control, that it should be in the hands of the Government. Therefore, we welcomed to that extent the setting up of this fund, but we stated at the same time that we thought much fuller information should be given to the House as to how the fund was operated and the purposes to which it was being put. Of course, we accept what the right hon. Gentleman has said, that it is to be used only for these three purposes, but there are a great many incidents to its use in that way which cannot be avoided. One of them, apparently, in the last few months has been the accumulation of large quantities of gold. Some £60,000,000 extra of gold has been accumulated, apparently through the operations of this fund. The exact purpose which that accumulation of gold is to serve at the present time it is very difficult to see and, although it may not be in any way connected, it is liable to offer a great temptation to the people who want to see us back on the Gold Standard. The fact that we have large reserves of gold obviously makes it a very much closer and more proximate contemplation for those people who have for some time now been hankering after a return to the Gold Standard, whether on the original basis or on some lower basis of sterling, and we feel that, if this £200,000,000 is going to be used in the continued accumulation of gold, as it has been during the last few months, it is bound to have considerable weight in determining the question whether we return to the Gold Standard or not.
There is another matter which seems to us to be almost inevitable in the use of this fund for the purchase of gold. The right hon. Gentleman said it was not intended to utilise this fund in any way to alter the value of the £ in terms of long periods of time. It was only intended to iron out the day-to-day fluctuations. But, if we are going to accumulate large quantities of gold, at whatever price

1045
that gold happens to be purchased by the Bank of England, it must inevitably have an effect on the general trend of our exchange values, and during the last few months, certainly, the opinion has been expressed that the Exchequer value of the £ in this country has been kept down by the operation of the Exchange Equalisation Account—I do not say consciously kept down, but it is very hard to tell what is a day-to-day fluctuation and, if you have a little fall one day and iron it out, and a little fall the next day and iron it out, you may be ironing out the initial stages of a general tendency and, of course, should a general tendency happen, which ex hypothesi it cannot if you always iron out its beginnings, it is impossible to tell at the time what is happening.
But, if one looks back at the operations of the last few months, I should have thought that it was fairly certain that this exchange fund had in fact affected something more than the mere day-to-day fluctuations, that it had succeeded in keeping the value of the £ down when there was a danger of its rising owing to various outside circumstances which, but for the Exchange Fund, would have caused the £ to rise. I am not criticising that operation. What I am pointing out is that, however much the right hon. Gentleman may determine to keep this merely to day-to-day fluctuations, he is bound to associate with the ironing out of day-to-day fluctuations some policy as regards the general trend of the exchange because, unless he has some policy in his mind, something that he is aiming at, it will be impossible for him to tell how the exchange should be allowed to react over periods of time.
We have always felt that to try to anchor sterling to gold, either directly or indirectly, was a bad thing, and that, once we got rid of the Gold Standard, it was extremely undesirable, whether through some foreign exchange or directly, that we should get back again to gold on any parity, not because of the particular value of sterling and gold at any time, but because of the incidence of the Gold Standard itself and the fluctuations in terms of the commodity value of gold. On the last occasion we pressed the right hon. Gentleman to consider whether it would not be much wiser to try and anchor sterling to wholesale com-
1046
modity prices rather than to continue to try to anchor it either on some particular exchange, on the dollar exchange till that went off gold, and now, I suppose, to the franc exchange or some other exchange, or to come back directly to gold itself.
We feel that it is quite a hopeless proposition, if we are aiming at any reasonable currency stability in the present circumstances of the world, to be anchored to any metal—or to any mixture of metals, for the matter of that. The hopelessness of it is shown by the recent use of gold which has been made in the world. The old idea, as I understand it, of the Gold Standard was to have sonic permanent means of measuring your different currencies, and also to have a means of paying international differences. When one country's balance is a credit balance from another country, then the difference should be paid in gold, but now that idea has apparently completely vanished. The United States of America, with an enormous gold stock, first of all goes off the Gold Standard and now announces that gold bonds from the United States will in future be paid in paper currency; a thing which seems to be contrary to every possible criterion of honesty, and also contrary to every possible way of using the Gold Standard. When we went off the Gold Standard we continued to pay our American debts, but nobody now will seriously contemplate, after the recent action of the United States of America, that we shall ever do it again. The United States have given us what seems to be a lead in the way in which, when you get into financial difficulties, you can get out of them.
The French, of course, did that long ago. They cut down their foreign debts to one-fifth by means of paying in paper francs. Now America, with this vast hoard of gold at her back, is going to take the same steps. It seems a perfectly hopeless proposition that anyone should contemplate going back to a system which was primarily intended to make it easy to evaluate international debts and to pay international debts by the transference of the metal, but which has now merely become a question of hoarding in different countries. There is £800,000,000, or whatever it is, in America, an enormous sum in France, and I suppose now, under the operation

1047
that has been going on in the last two weeks—the Exchange Equalisation Fund —as soon as the gold is dug up in South Africa we shall put it down in the cellars here. Would it not be much cheaper to leave it there instead of taking all the trouble to transfer it over here and bury it again? We feel that there will be a very serious risk indeed in our getting back, either directly or indirectly, on to a Gold Standard which has entirely ceased to operate in the normal way—or, indeed, in any way at all. We fear that risk for this large sum of extra money which the right hon. Gentleman proposes to ask the Committee to allow him to raise.
Then there is the question of the effect on the bad money market here. As I understand it, this money will be raised by the issue of Treasury Bills, as was the last £150,000,000 during the last year. How quickly the right hon. Gentleman proposes to raise it, whether from time to time as he requires it, or whether almost immediately, I do not know. He has not told us when he expects to raise the whole sum. But the effect of raising that money will presumably be to increase the deposits at the banks, just as the last issue of £150,000,000 increased the deposits at the banks by almost exactly the same amount. We shall get to some extent a financial inflation, but not an expansion in industry; exactly as during last year, with the extra £211,000,000 of floating debt that was issued, we had a financial expansion but did not get any utilisation of that money in the industrial world at all. The available credit based on that money was left unused.
If we are to increase the floating debt by £200,000,000, would it be better to use it as a counter-speculation fund against the international capitalists who have got this bad money floating about, or to use it for an industrial expansionist policy? I should have thought that this Committee would have no doubt on that point. It we are to raise £200,000,000—whether that is wise or not we need not discuss—why should it not be used for what the-right hon. Gentleman the Prime Minister and Mr. Roosevelt decided was advisable; namely, to pump the money into industrial circulation by wise Government measures—by big public works, by housing programmes, or by all
1048
the other means which have been so often discussed?
We feel that if this large sum of money is available, as it is available, and if it can be borrowed on very cheap terms, as it can be borrowed at the present time, there is an admirable opportunity, having got this £200,000,000, to make some provision by which this bad money is kept out of the country—taxation, prohibition, or anything else you like; to take a firmer control over the foreign exchanges of the country, so that we can in fact deal with this money and use the £200,000,000 for a really useful purpose which will do something and effect something with regard to the position of the country, and which will not merely be a game of speculation between the international financiers which may or may not come off well, but will not affect by one iota the question of employment in this country.
I quite appreciate that the part of the fund which is ironing out day-to-day fluctuation, and which is operating satisfactorily at the present time, is a useful part of the export trade. But so far as this other portion is concerned, which we are asked to raise for the special purpose of protecting us from this bad money, we do not think that it is wise to have this very large sum of £350,000,000, and we do not think that we can support the raising of available money for that purpose, especially as it shows conclusively that that large sum of money is available to be borrowed at cheap prices and that, if the Government wish, they could use it for something which would have a very definite and decisive effect at the present time upon the employment of the people.
Mr. ALBERY: Before the hon. and learned Gentleman sits down, would he kindly explain how he proposes to do the one thing without the other: to iron out the fluctuations in export trade, and to prevent bad money from coming into the country?
Sir S. CRIPPS: One must take some steps, by having a much firmer control over foreign exchanges, to prevent people sending bad money here.
Mr. ALBERY: That is what it is for.
5.9 p.m.
Sir ARTHUR MICHAEL SAMUEL: I wonder what this country could do

1049
with this £200,000,000 if it were borrowed for industry or housing as suggested by the last speaker. In the first place, there is no scheme—as I understand from a reply given to me in the House by the. responsible Minister—yet put forward by a municipality or a public body, to which, if it is a justifiable one to borrow on, the Minister is not willing to agree. If houses are to be built, the money is available and the permission by the Government is available. The right hon. and learned Gentleman talked about industry. He has had very little to do with industry personally, as far as I know. I have had to do with production, and with selling goods for export. It is no good giving us more money with which to manufacture; it will not enable us to export more goods; we cannot sell them. The export trade has been very gravely injured, as we know, and any attempt at inflation here would injure it further. When people talk about putting up the value of wholesale goods, they forget that the only wholesale primary commodity produced here is coal, besides manufactured or secondary goods, and if the prices of coal and manufactured goods are put up, God help the people who produce both! We cannot even now sell them either here or in the markets abroad.
But I will not pursue the points raised by the right hon. and learned Gentleman, because I fear that he has to tread very gingerly upon a matter on which he is not very much informed, and that he has to bring in by its finger-tips some reference to Socialism. I wonder whether, when he applauds that this money is invested in exchange for the benefit of the State, he thinks of applying the principle to himself? I wonder how he would like to see the money he had saved, as a result of his own work, invested for the benefit of the State; to have to hand over his capital to be put down for the reduction of the National Debt?
Let me turn to one or two observations made by the right hon. Gentleman the Chancellor of the Exchequer. I did not think that he was quite happy when dealing with the original £150,000,000. That matter came up on a previous occasion. But he referred to this additional demand as if it arose from an unforeseen phenomenon; he referred to
1050
refugee capital coming in. Is that so? Was it unforeseen? Does it accord with a warning speech made on 11th March, 1932? May I weary the House by reading one or two extracts?
"These two sets of circumstances in the United States and in France may result in a flight from the dollar in America to the pound sterling, and if there is a flight from the dollar to sterling in America I will go as far as to say that that will be reflected to France by a flight from the franc to sterling. France and America will take shelter behind the ramparts of sterling and something will occur which we have barely foreseen."—[OFFICIAL REPORT, 11th March, 1932; col. 2144, Vol. 262.]
Mr. CHAMBERLAIN: That is your speech.
Sir A. M. SAMUEL: Yes. I do not think that the right hon. Gentleman is justified in saying that this is a new phenomenon. He was warned. He went on further to say, in replying to me
"Mr. CHAMBERLAIN: I think my hon. Friend is mistaken in the view that there is any probability of the United States being forced off the Gold Standard."—[OFFICIAL REPORT, 11th March, 1932; col. 2154, Vol. 262.]
He did not take my view. I am bound to say that with the knowledge which we had, I should have thought that that position with which we are now to be confronted was regarded as inevitable And when he now says that he would not like, later on, to come again and ask for more than £200,000,000, I hope to Heaven he will not. But if there is a Niagara of panic gold or other gold currency from France or America, we shall be swamped by that Niagara coming here, and his £200,000,000 will not be worth very much to stem the tide.
Two hundred million pounds, when I was a youngster, was the amount of the Budget, the total expenditure of the whole country. To-day hon. Members come gaily down to the House on this sunny Thursday afternoon quite willing to vote £200,000,000 of the taxpayers' money, content with the idea that it is to go into a blind-hookey pool! It was said by the Financial Secretary the other day, and repeated by my right hon. Friend the Chancellor, that no loss has been made. It is very lucky that there has been no loss; it does not follow that there will not he one later on.
But where are we? Where are we going? I myself am voyaging through

1051
an uncharted sea, and I do not know whether it is not also true to say the same in regard to a great many other hon. Members of this House. They are equally in the dark. I need to get my bearings. We are told very little about what is to be done except "to keep the exchange from violent movements." How are exchanges to be kept from violent movements? The American and French exchanges are terrified out of their lives of their own shadows. We have also to face this: that the United States went off gold without any warning. No one was more surprised, perhaps, than the right hon. Gentleman when the United States went off gold and smashed the whole of the world's exchanges.
Mr. CHAMBERLAIN: Except yourself!
Sir A. M. SAMUEL: No, I did not expect it at the moment. I hoped that it would not happen. I regret it. It is no satisfaction to me to say, "I told you so." I took the view of ordinary precaution of a man who has been in trade and does not wish to see the measure of values by which he buys and sells his goods made into a piece of elastic. That is all it is now. It is an elastic ribbon. We buy and sell and we do not know at what we buy and sell. The United States went off gold without the slightest warning. I was sorry and surprised when they went off gold. The United States will take further currency steps without any warning, perhaps to revalue, or to devalue the number of grains of gold in the dollar. Without the slightest warning, they will act again. I am bound to speak about the United States, and I hope that I may not be thought to be trespassing beyond good taste in speaking about another and friendly nation. if the United States, without warning, revalues or devalues the dollar; puts a different volume of gold grains into the dollar than were formerly supposed to be in it, what will the franc do 7 You will have the franc in a maelstrom. We shall not be able to look for any stability in the franc. It will be up and down. What will an Exchange Fund of even £350,000,000 do if France also goes off gold?
The Chancellor of the Exchequer referred to a matter upon which I agree. He
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told us about public opinion in the United States being misled. There is no doubt that public opinion there is being wrongly led to believe that we went off gold and that we are working the Exchange Fund with the object of injuring the United States and the trade of the United States, and that we are doing it from revenge and malice. Nothing is further from the truth, and everyone in this House should say a word of protest against such an interpretation being put upon our action. We are the most unselfish of nations in our international financial arrangements because we are world spread with a world-wide trade. If for no other reason, it is to our commercial interest to see that our customers all over the world are not injured in currency matters and that we do all we can to help them. The United States Government, with the view being held by some of their nationals that we are endeavouring to injure them, may find it necessary to placate them by taking some quick action, and letting it be implied that it was to revenge themselves upon us, as they thought that we took the step of going off the Gold Standard a year and a-half ago in order to injure the United States and capture their trade. It is not so. We were forced off the Gold Standard; we could not help ourselves. What is more, we struggled, and were willing, and actually sacrificed £130,000,000 sterling to keep ourselves on the Gold Standard.
That is what we should tell the people of the United States. They, however, have not risked a shilling or a cent to keep themselves on the Gold Standard. We are in a queer position. We are told we must level out exchange. Here is the United States with £900,000,000 worth of gold and we have to vote £200,000,000 on the top of £150,000,000 for the purpose of helping to prevent the United States dollar from collapsing. The hon. and learned Gentleman said quite rightly that the United States was defaulting on her Liberty Bonds with interest payable in gold, by her own contract, signed and sealed; she is defaulting on bonds, in not paying the interest in gold to those who lent her their money. Yet she asks us to pay gold for our war debt. The thing is preposterous. I am very thankful to think that, acting on the advice of the right hon. Gentleman, we did our duty like honest men. We did not default.

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We played the game. For years during the War and after the War the financial people of the United States hoped and thought they were going to capture from Great Britain the financial hegemony of the world. No one will look to New York again for leadership in economics or finance after its default on Liberty Bond gold interest and the muddle they have made in their national money matters.
In face of what we are doing, the United States may take some steps to nullify our Exchange Equalisation Fund action and do the very opposite to that to which the Chancellor of the Exchequer is to-day addressing himself. He is trying to keep level the value of dollars in terms of sterling. He wishes to level out the value of dollars in terms of sterling and prevent violent changes in rise or fall. The United States may take the opposite step. They may produce a Stabilisation Fund for the purpose of keeping down the value of dollars in terms of sterling; they may wish to reduce the valuation of their dollars for purposes of inflation. Why? The United States needs to put up the price of her commodities and her Wall Street securities. Why? Because at present the quotations of commodities, upon which are based the value of Wall Street securities, are so low that the commercial banks, the savings banks, the life assurance companies and the trust companies in America are barely solvent at all. They hold these securities either as investments, or they have lent money on the securities. If these frozen securities had now to be sold so little value would appear in the balance sheets of many financial institutions that the assets would not balance the liabilties. Unless they are to be put higher many financial institutions will be unable to remain solvent. It is to the advantage of the United States to bring about inflation for the purpose of putting up Wall Street securities in order to protect the whole of their financial system from collapsing.
What a queer position. France has £400,000,000 of gold, and yet we have now to come along and use more of the taxpayers' money in order to protect the franc. Why? Here again they have been meddling and tampering with currency, and manipulating monetary systems. It is only another form of dishonesty and
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always comes back upon the heads of those who practice it. The ordinary citizen of France, with four-fifths of his franc savings gone by recent devaluation will not lend the French Government any more money. What is the next step? France, with £400,000,000 of gold, must, in order to protect the franc, come over here and borrow £30,000,000 of our banks. We live in a currency bedlam.
If America establishes a dollar stabilisation fund we shall have to embark upon a campaign or battle of currency depreciation in a scrambling melee straining to see who can keep up currency or keep it clown. We shall have a clash of currency aims between the United States and ourselves if they put up a fund on the same lines as this fund. I believe they will. Is it not madness for us to begin such a campaign? We ought to know, and the Chancellor of the Exchequer can of course take steps to find out if he thinks proper or, at any rate, obtain some sort of information as to whether the United States are about to put up an exchange stabilisation fund or not. Cannot the United States, France and Great Britain corm to some currency or standard agreement? Perhaps when the United States see, as they will for the first time to-day—because we ourselves knew nothing about it until this morning—that we are determined to put a couple of hundred millions more into a pool to iron out fluctuations in their own dollar, it will set them thinking in order to see whether it will not be better to come to some agreement with us rather than have a currency fight.
We, at least, know what we want and how we intend to attain our aim. Notwithstanding what the hon. and learned Gentleman said about gold, I think that in the long run the world will find that we must, under proper conditions and safeguards, in time come back to gold as our standard. I cannot see how we can do anything else. We intend to act in the general interests of the world because we are interested in world trade. We shall not be doing anything selfish, wrong or economically foolish when we come back eventually to gold. When we decide what the gold content of the £ shall be, we shall be doing something which will commend itself to the general interest of the world. The French Government also know what they want. They

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know how to obtain it. But they are selfish. They will smother whatever they do with polite insincerities, but they will do everything they may wish to do without the slightest regard for the convenience of anyone else. They have not, in any great degree, a world trade. It is not so much to their interest to see other nations prosper, because world-trade prosperity does not touch them as it touches us.
The United States are mere children in these exchange matters. They are 100 years behind us and the rest of the world in economic philosophy. They do not even know what they want. They have made an awful mess of their finances. We were told that God's own country is to teach the world how to live and behave itself. Here they are on their backs and floundering recently with barely a bank solvent, and some of their life assurance companies probably unable to balance their assets and their liabilities. They are not in a position to give us any lessons. But I sympathise with them. I wish they knew what they want, and knew even how to understand what they want. Neither does the United States know how to try and attain any vital economic aim she may decide upon.
Mr. CHARLES BROWN: Has the hon. Member forgotten that the Prime Minister has been advising them?
Sir A. M. SAMUEL: This is not a matter about which to be funny; it is a very serious matter. The employment and fortunes of a large number of people depend upon the smooth working of the tramlines upon which trade runs. We therefore ought to ask, in all friendship the United States what she is aiming at, and say that we are willing, as long as her needs do not injure us, to make some sacrifices, and that we will come in and help her to understand her own problems. Otherwise we shall "pull devil, pull baker" be trying, with the aid of our Exchange Fund, to keep the dollar up, and they, with their fund, will be trying to keep the dollar down.
Mr. CHAMBERLAIN: I must protest against my hon. Friend who has submitted many times the exact contrary of what I said in my opening statement. He keeps on saying that the object of the fund is to support the dollar. I ex-
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plained very carefully and most emphatically, and I hope that my remarks and not those of the hon. Member will go across to America to show that it is quite wrong. This fund has no intention or purpose of supporting the dollar.
Sir A. M. SAMUEL: I understand. I accept the correction. I used the wrong words. What I meant was that the fund was used to iron out the inequalities of the dollar exchange. Will the Chancellor of the Exchequer let me put it in that way? We do not want the dollar to go either up or down. We would rather see the dollar round about 3.40 than at 4.40. On the other hand, the Americans would, I assume, rather see the dollar at 4.40 than at 3.40 to the £. It would help their export trade. If we have a "pull devil, pull baker" attempt made by the various operations of two opposing funds, it will be disastrous, whether the right hon. Gentleman the Chancellor of the Exchequer wishes it or not. It may develop into a tariff war. No man can control exchanges permanently. The law of supply and demand will beat him every time. As you can dam up a river for a time you can dam up an exchange from time to time. But sooner or later the dam bursts and the law of supply and demand will overwhelm you. The right hon. Gentleman will be quite powerless with the fund just as powerless as he would be in face of such a catastrophe as an earthquake or a tidal wave, if we have an inrush of panic currency coming either from the United States or France if the flight from the dollar and the franc reaches large totals.
The United States must realise, although her pride may be hurt, that her banking system has failed, that her tariff system has failed, that her war debt policy has wrecked her trade, and now we have to find this sum of £200,000,000 in order to save the tramlines on which international trade runs. We are groping in this matter, and we hear a great deal of talk—windbaggery I call it. Some people talk about the virtues of counter deflation, or loan expansion for non-reproductive objects, we are lectured by theorists hourly on the magic remedy of inflation. We have our Sir Jeremiah Slumps, our Professor Seamews, and our Mr. Baynes always patting their chests and telling us what we should do, creating

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from their imagination an ideal world from non-existing conditions and risking national credit, to put their imaginary worlds right.
We are face to face with conditions which I do not believe can be dealt with by any Economic Conference until and unless we know what the United States is aiming at and is prepared to do. We ought to try to work with the United States to fix the exchanges at a figure which suits both the United States and ourselves, and which will enable the Gold Standard to work, if properly administered. I do not think that we should talk in the World Economic Conference of 60 nations about exchanges, prior to some arrangement with the United States about exchange, and unless there is some agreed settlement about war debts, some lowering of the United States tariff wall, some undertaking by the United States and France to act in such a way as will ensure that the Gold Standard works properly. In that way we can put international exchange currency right and do away with the necessity for voting this sum of £200,000,000. We can in that way get the world out of the tangle which has been caused by the world's currency systems going wrong. We can put straight the tramway upon which currencies work backwards and forwards between nations. At the present time the tramway line is blocked and warped and because of that we and other nations cannot trade in various parts of the world. We can smooth out the currency-standard problems of the world if we can come to some amicable arrangement between the United States, France and this country. Lately we have armed ourselves with a new weapon. We have the weapon of Protection, and if we cannot by agreements get our export trade going along the exchange tramline, by the use of rehabilitated currencies and free-working exchanges, we have the power to shut our ports to foreign goods.
5.34 p.m.
Mr. DAVID MASON: With much of what the hon. Member for Farnham (Sir A. M. Samuel) has said I agree, and in general I agree with the views expressed by the hon. and learned Member for East Bristol (Sir S. Cripps) for a declaration of Government policy. We are all desirous of knowing what is the Government's policy. We may differ as to
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our views on currency problems, but when the Chancellor of the Exchequer comes to the House and asks for the large sum of £200,000,000 we are entitled to know more than vas given to us in the statement that he made in regard to the disposal of the £150,000,000, which was meagre in the extreme. The hon. Member for Caerphilly (Mr. Morgan Jones), who is Comptroller and Auditor-General of the Public Accounts Com-mittee—
Mr. MORGAN JONES: I am only the Chairman of the Public Accounts Committee.
Mr. MASON: I am sorry if I put too great an honour upon the hon. Member. Under the Finance Act of 1932, Section 7, it is provided that:
"This account shall In every year until it is wound up be examined by the Comptroller and Auditor-General in such manner as he in his discretion thinks proper, with a view to ascertaining whether the operations of and in connection with the account have been in accordance with the provisions of this part of this Act."
Has the account been examined? If so, we are entitled, as we have voted £150,000,000, to see that account. Sums of £150,000,000 and £200,000,000 are very large, and the taxpayers, through their representatives, are entitled to know how that money has been disposed of. The Chancellor of the Exchequer seemed to think that by ironing out the exchange he would prevent fluctuations in the exchange. He said that the scheme had worked very well during the past year, at a cost of £150,000,000. Now he comes for another 2200,000,000.
Captain Sir WILLIAM BRASS: He did not say that it had cost £150,000,000.
Mr. MASON: It involved a liability of £150,000,000, and he is now asking for a further £200,000,000. One cannot tell what it will cost if he gets back eventually to the old parity. If he takes out his balance to-day it might show a small profit, but we are only temporarily off the Gold Standard. Even the Chancellor of the Exchequer will agree that that is the case. I want to know, seeing that we have voted £150,000,000 and we are how asked for another £200,000,000, what is the policy of the right hon. Gentleman. Does he intend eventually to get back to the old parity? If he does, then on the present rate of from £5 10s. to £6 10s. to the fine ounce, this country

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will be involved in a loss of something like £26,000,000 to £30,000,000.
Colonel WEDGWOOD: Is not that a good reason for not going back to it?
Mr. MASON: I will deal with one thing at a time. I am trying to show that if the right hon. Gentleman would tell us what his policy is we should be able to estimate whether it is wise or the reverse to give him power to incur a further expenditure of £200,000,000. We shall lose a large part of that £200,000,000, which is to be used for purchasing gold bullion. If he intends to get back to parity and we are purchasing gold bullion at over £6 to the fine ounce, we can estimate how much that will cost the taxpayer, if we go back to the gold standard at the old parity. We are entitled to ask the right hon. Gentleman to state more specifically what is the policy of the Government. It is an amazing thing, on the meagre statement that we have just heard, to ask that this country should blindly give him a blank cheque for £200,000,000. It is a monstrous thing. It assumes that we are bereft of our senses.
The hon. Member for Farnham told us that £50,000,000 was a large sum in his young days, and he is staggered at this liability for something like £350,000,000. The late Financial Secretary to the Treasury gave us a pledge in regard to this Fund, of which I should like to remind hon. Members. I am quoting from the OFFICIAL REPORT of the 9th June, 1932. We were pressing then, as we are doing now and as hon. Members are entitled to do and intend to do irrespective of the party to which they belong, that we should be told what is going to be done with the money when we have to vote hundreds of millions of pounds. When we asked what was going to be done with the £150,000,000, the Financial Secretary to the Treasury said:
"To meet that point I am perfectly willing to give a pledge to the House and to the hon. Member for Caerphilly (Mr. M. Jones), the Chairman of the Public Accounts Committee. First of all, the account will be made up on the 31st March next. The question of the publication of the year's result cannot arise until after that date. Secondly, there is adequate statutory authority for enabling it to be published with a report by the Comptroller and Auditor-General without making any amendment in the existing Bill. If we find
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when the time comes that the accounts can be published, without detriment to the public interest, the Government undertake that they will certainly publish it, but if it seems necessary to them to withhold it from publication, they will before reaching a decision upon it consult with the hon. Member for Caerphilly, or whoever is at that time Chairman of the Public Accounts Committee, before the introduction of the Finance Bill, or at an early stage of its passage through the House.—[OFFICIAL REPORT, 9th June, 1932, col. 2235, Vol. 266.]
I would ask the hon. Member for Caerphilly if they consulted him in regard to this account. Will he at a later stage inform us what is the state of the account, what have they been doing in regard to it and what is the policy of the Government? How do they iron out the account? The Chancellor of the Exchequer took umbrage at criticisms because he said that the fund was not being used to depreciate the £. He taunted me in regard to a speech that I delivered on the question of raising prices when I said that this policy of depreciating the £ was a bad one for trade. He told me to ask any industrialist. Therefore, lie supported that policy. It is absurd to say that it is not being used for that purpose.
When the right hon. Gentleman uses the term "ironing out," what does he mean? He means ironing out the exchange at about the previous existing level. The effect of the United States going off the Gold Standard and depreciating the dollar, advanced the £, and therefore the fund is rendered useless. It is childish for the Chancellor of the Exchequer to try to delude us with the idea that with this fund, even if he increased it to £1,000,000,000, he could control the forces of nature. He is following a wild will o' the wisp. It is ludicrous for him to say that this fund is not intended to depreciate the £. He told me that I would use the resources of this country to support the £. I would do nothing of the sort. What he is asking us to do is to use the resources of the country to depreciate the X. That is his policy and that has been his policy. I do not want to do anything to affect the £ in an artificial way. I desire to see the £ restored. I desire to pay 20s. to the £. The £ is at a discount and this fund is to keep it at a discount, and he thinks that it will help the industrialists.

1061
The Financial Secretary to the Treasury is another financial genius. He came down to this House and told us in that complacent manner of his that £2,000,000 had been taken off the Exchange market. He was 'speaking with reference to the imports from the United States, we were preventing certain imports coming into this country, and he boasted that he had taken £2,000,000 off the Exchange market. Does he know how trade is conducted 1 I will tell him; it may serve a useful purpose. I was staggered at the complacency of the Financial Secretary in saying that he had taken £2,000,000 off the Exchange market. When the United States exporter sends his goods to this country they are paid for by bills, and these bills are the remittances which the American importer uses to pay for Bradford and Manchester goods. When we import goods from the United States we are providing the currency for the American importer to buy goods from us and, therefore, the more goods we buy from them the more they are able to buy from us. When there is a large supply of these bills the price goes down. The Financial Secretary boasted that he had taken £2,000,000 off the Exchange market. What he really did was to curtail the facilities of the American importer to buy Bradford and Manchester goods. That applies to all our trade. By these kind of restrictions, by this kind of interference, you are curtailing trade generally, and the Financial Secretary who appeared to be proud of the fact that he had taken £2,000,000 off the Exchange was in reality interfering with and attacking the general trade of the country. The proof of that is that the general trade of the country has gone down.
What is the policy of the Chancellor of the Exchequer? What does it amount to? It is a sort of dole, a supplement, to the general trade of the country. In order to keep the exchange low and stimulate exports he is continually borrowing. If he would allow the exchange to come back to its natural level, if he would allow the £ to come back to parity, there would be a great development of trade, both in exports and imports, which would please the Tariff Reformer and the Free Trader as well. Because he has failed in one direction, he tries to supplement it by tinkering and
1062
tampering with the exchange. I can only express the hope that hon. Members will oppose this Resolution. If I can get anyone to go into the Lobby with me I shall certainly oppose it. It is most unsound, a most dangerous principle, which will involve this country ultimately in loss. The Chancellor of the Exchequer is not, at all sure of his ground. Even after 12 months he is not able to assure us that he has had any success. What is his object? Is it to restore the £? His object, I say it deliberately, is to please certain industrialists, and he does so at the expense of the wage-earners of the country and the creditors of the State. By using the £ in order to get parity round about three-quarters he penalises every wage-earner in the country by 5s. in the £, and prevents the natural return to creditors of the State from their contracts.
The Prime Minister at the last election held before the eyes of the public a thousand million mark which was worthless, and said that he was going to restore and maintain the £. Hon. Members were elected to this House in order to restore and maintain the £ because their predecessors were incompetent and extravagant. I attacked them for running into debt. We came in to restore the £ and to maintain it. The Chancellor of the Exchequer is asking the House of Commons this afternoon to give him a further credit of £200,000,000. He says that it is not for the purpose of depreciating the £. If not, in heaven's name, what is it for? What is his policy? What is his object? It is monstrous to come here and ask hon. Members who are engaged in industry and banking, who know something about it, to agree to this Resolution. It is an insult to the intelligence of hon. Members that we should be treated like children who know nothing about it. [Interruption.] Hon. Members seem to think that it is a joke. I am speaking fervently but sincerely, and I submit that this is really a serious matter which should be regarded seriously.
I am sorry to have dealt so much with these technical matters of finance. I have attacked the Government in a somewhat extreme manner and I may be asked, what remedy do you suggest, what do you suggest as a means of stabilising the Exchange? That is a fair question to put to anyone who attacks the Govern-

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ment. I have made a considerable study of this problem and of the remedies proposed by Mr. Keynes and Sir Walter Layton, and I confess, like many other hon. Members, that there is no alternative but to link the currency of the countries of the world to gold. I can see no other method which will give us that stability of the Exchange which is the object of the Chancellor of the Exchequer. This can be obtained without using the resources of this country at all. It can be obtained by pursuing the ordinary methods of sound finance, not by wild-cat finance of this character, not by trying to reverse economic laws. It can be attained only by bringing your policy into accordance with economic laws. I offer that suggestion to the Government.
The Bullion Report of 1810 was the result of the deliberations of some of the most eminent and distinguished bankers and financiers. It has been the foundation of the currency system of this country for the best part of the last century. We were going through at that time almost the same experiences we are going through to-day. We had the inflationists and the deflationists in 1810, and all the various other alternatives which have been submitted to this House. There were many Debates on the question, but no remedy was found to be successful until the Bullion Report of 1810 was published. There is a passage in that report which I venture to read to the House, because it puts the whole question in a nutshell:
"When the currency consists entirely of the precious metals or of paper convertible at will into the precious metals, the natural process of commerce, by establishing exchanges among all the different countries of the world, adjust, in every particular country, the proportion of circulating medium to its actual occasions, according to that supply of the precious metals which the mines furnish to the general market of the world. The proportion which is thus adjusted and maintained by the natural operation of commerce cannot be adjusted by any human wisdom or skill. If the natural system of currency and circulation be abandoned and a discretionary issue of paper money substituted in its stead, it is vain to think that any rules can be devised for the exact exercise of such discretion; though some cautions may be pointed out to check and control its consequences; such as are indicated by the effect of an excessive issue upon exchanges and the price of gold."
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That is the basis of a sound currency system for this country and for the world. It was drawn up by most eminent men and it has never been undermined as a sound financial policy. Hon. Members will see how it may be applied to-day. If our currency is convertible sooner or later into gold at will, the natural process of commerce by establishing exchanges in different countries of the world will adjust in every particular country the proportion of the circulating medium to its actual occasions. That means that the exchanges will be governed according to the trade and commerce of each nation. If you are on the Gold Standard, if you get that as a common denominator among all nations, it will do what the right hon. Gentleman is asking us to give him £200,000,000 to do; and it will do it automatically and naturally. That is the best way. It is the way advocated in that famous report, which is the foundation of this country's currency and trade. The largest foreign trade in the history of the world was built up on the principles of the Bullion Report of 1810.
We all desire to restore our currency and our trade. I am not pedantic in this matter. I am perfectly willing to listen, and if the Chancellor of the Exchequer proves to be a new genius in the world of finance and has discovered some method which will make water run up hill, some method of controlling the exchanges, I hope I shall have the candour to admit it and pay him my humble tribute. But I honestly believe that it is impossible, it is a waste of time, and, therefore, my last word is to ask him not to make this contribution to the World Economic Conference. Great Britain which has led the world in finance, and I hope will continue to give the world a lead in finance. I hope we shall lead other nations of the world to adopt a gold standard. The immortal Pitt once said that England had saved herself by her exertions and would save Europe by her example.
We ought to show the Economic Conference and the world, that we adhere to these sound principles and are not to be drawn into a competitive race with the United States in the matter of depreciated currency. We ought to show that we are not going in for a policy of continuous borrowing for the purpose of trying to control exchanges; that we

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have learned something from history and that we believe that the policy which made this country great in the past, will add still further to its triumphs in the future.
6.1 p.m.
Mr. S. SAMUEL: I propose to confine my remarks as far as possible to the direct proposal to increase this fund which the Government call an Exchange Equalisation Fund, although, as far as I can see, its operations up to the present have had nothing whatever to do with the equalisation of the exchanges. I think I am justified in claiming that the prediction which I made when I opposed the establishment of this fund last year has been fully justified. I then pointed out that it was utterly impossible for this nation, with a miserable £150,000,000, to control the exchanges of the world. I then pointed out and I wish to point out again that the United States has a fund of between £900,000,000 and £1,000,000,000 with which to operate and while individual capitalists—those to whom hon. Members opposite so much object—may risk their own money in exchange speculations, there is no body or group of people who could command such vast sums as those at the disposal of the United States and France. It is absurd to think that the comparatively small transactions in which these so-called speculators are engaged could have any effect as against enormous accumulations of capital like those controlled by the United States and France.
The House must bear in mind the origin of this fund. We were heavily indebted to the United States. We had a very serious financial crisis in this country. I do not say it viciously, but there is no doubt that this country being in this position, the United States thought they could make capital and profit out of the situation by buying up exchange against this country and also against France. The result was that you had a throat-cutting policy in operation between the United States and France. Both aimed at the control of the gold of the world, and each tried to injure the other. No doubt in those circumstances there were small speculators who ventured, perhaps £2,000,000 or £3,000,000 operating in gold and exchanges, but it had no effect whatever
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upon operations of vast magnitude taking place in various parts of the world.
The exchange business is a very peculiar one. It is done from hand to mouth. I have no wish to lecture the House, but what I say has a bearing on the whole present position. The exchange business is a legitimate business, but it is done from day to day and from hour to hour. Those engaged in it communicate with different parts of the world and find out what currencies they have to sell and what currencies they want to buy. It is possible over the telephone at almost any moment to find out the position in Madrid or Amsterdam or in nearly any part of the world. The real exchange houses, the respectable houses are not speculating houses, and every night they make up how they stand in regard to pounds, dollars, francs, marks, and so forth, find out what they have to look for, and, when they have ascertained their position they close their books and round off their accounts and cover themselves so as to make both ends meet. Every night they can close their books and see if there is any profit on their transactions, however infinitesimal. That is how exchange business is carried on in the world. It controls and helps transactions in commodities, and if you interfere with the fixing of the exchanges, you will certainly interfere with the free operations of commercial enterprise.
This business as I have described it has been going on for years and it is only within the last year or two that the political element has been introduced into its operations as well as into commerce and everywhere else. I only touch upon these matters in order to show how utterly impossible it is for this country to control exchange. I suggest that it is not control at all but pure speculation. I am not opposing this additional £200,000,000. I am only warning the Government. I am not going to vote against the Resolution hut I want the Government to study the position and to realise the further risks which they are going to take. The Government have got the idea and I suppose others have the same idea that gigantic speculation has been going on. If that; were the case they would have been right in what they did but the speculation of individuals is

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so infinitesimal that it has no bearing at all upon international exchanges. A great many people when they talk about the stabilisation of exchanges think only of the United States and France but why not stabilisation of the exchange at the Egyptian or the Italian or the Turkish parity? Every one of these nations has its exchange differences and these exchanges mostly go through London. The whole of this exchange business is carried on by communication between one country and another to meet the requirements of all those countries which have regular commercial interests to be served.
As I say, the Government last year took it into their heads that gigantic speculation was going on and that they were going to cure this for the entire world by raising this fund of £150,000,000 which I have described as a miserable sum because it is miserable when compared with the extent of the transactions of the whole world. With this sum they were going to compete with the United States Government which was trying to monopolise gold and by monopolising gold trying to injure the foreign trade of this country. France had some grudge against America and wanted to compete with America and to see if they could not get some of the gold from America. But the whole of the theory upon which this fund is established falls to the ground and as I pointed out last year when this question was before the House the result must be what it has been in every transaction of the kind in my long business experience. You had years ago the case of the Comptoir d'Escompte de Paris one of the biggest banks in the world. They had a friend, a M. Secretain, a large metal merchant who went in for copper speculation. He succeeded in buying up a great deal of copper and cornering the market at the moment, but when he tried to sell the copper, although he had the bank behind him the result was that they went into liquidation and bankruptcy and many people were ruined.
We have seen the same thing in other cases such as nitrate. No nation or no individual can corner any article except by buying everything that comes forward. However, our Government apparently thought that it would be a very easy thing to stabilise the £ and to control the exchanges of the world. They started by buying gold when
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it was fairly cheap and, no doubt, if they had realised after a, few months they would have had a considerable profit on their operations but it was not big enough for them and they have kept on speculating in gold and in currency, because they have not confined themselves to gold but have bought dollars and francs and at one time even marks. The consequence is that they have driven the price of gold up from 90s. to 123s. and they have stimulated gross gambling in mining shares. A lot of people who had some inner knowledge bought up mining shares, some in mines that were not even working and then, all of a sudden, we had the enormous advance in gold which put up the price of mining shares to three, four and five times what people had given for them some time before and in some cases they were put up to more than double the original value.
That has been one of the ill effects of Government control and yet they have never done anything to affect the exchanges. I do not accuse the Government themselves but I say that their advisers have done that, because they have had this insane idea that they could control this exchange business by gambling. I have not any knowledge of what operations have taken place. We are not informed and we do not know the extent of the gamble but I think we are justified in saying that transactions of the kind that I have indicated have now been going on for over 12 months. It is rather like the case of the ostrich which sticks its head in the sand and imagines that it cannot be seen because we are told that one of the transactions of the Government only a couple of weeks ago was that they bought dollars just at the time when the United States went off the Gold Standard. They have now it appears been engaging in vast transactions unknown to anybody but themselves.
There is no crime in my stating, what is reported in the City of London, that they have over £60,000,000 in gold to the credit of this Fund in the Bank in London. We know that a large amount of dollars were bought by an unknown person in the United States of America, amounting to between £25,000,000 and £35,000,000, and in addition to that some dollars bought in France, besides French, Dutch and other currencies. We know that at the present time, and the Govern-

1069
ment know it or ought to know it, there is a prohibition against the shipment of gold from the United States. I wish to ask the Government one or two questions. The Chancellor of the Exchequer told us that out of the £150,000,000 of credit which this House had voted for the Equalisation of Exchange Fund they had uninvested or unemployed about £25,000,000. There is the £35,000,000 gold earmarked in the United States, but I wonder if the Government realise that if they want to ship gold to England or some other country they might not be allowed because there is this prohibition of the shipment of gold from the United States. We might find ourselves stuck with this gold. We do not know what sort of a game the Americans will play or what arrangements they have got for working, but it is quite possible we might have to leave this £30,000,000 of gold in the United States. The political position there is very precarious, and although the United States have this vast sum of nearly £1,000,000,000 at their disposal, they might say, "We are very sorry, but we have passed a law prohibiting the export of gold, and therefore you must keep it here until such time as it pleases us to release that gold."
We have the same sort of thing in France, with extraordinary commercial transactions going on. Although they are on the gold currency, there is no such thing as free gold there. They have a stock of between £600,000,000 and £700,000,000—rather nearer £600,000,000, I think—of gold, and therefore you are in the position that you may have to keep your francs in Paris. We have seen this before. In Germany you have a country on the Gold Standard, and the ridiculous part of it is that they have very little gold, but they manage to get along very well. If you send a pound note to Germany you might think you were lucky, with the credit of Germany, if you got 14 marks paper, but all you get in Germany to-day, if you want exchange for your £1, is 14 paper marks, which under no circumstances will they convert into gold, although they are on the Gold Standard. Therefore, you get locked up with 14 pieces of paper of a mark each, which you cannot use except by a miracle.
That shows how impossible it is for this country or any other country to control the exchanges of the world. We know
1070
very well that the currency of the world is bound to be gold. We cannot get away from it. Gold is required only for international currency, and when it is melted down to real business, the only gold you require is for settling the differences at the end of the transaction. We realise perfectly, and I think everybody who has experience in foreign trade knows, that at the end whatever transactions we carry out honestly will have to be settled up on a gold basis. In the olden days, until the advent of the present gambling propensities, there was an immense amount of credit, and it was owing to the honesty of this country, it was owing to the fairness of her industrialists and merchants, that Great Britain had an enormous credit throughout the world. The £ sterling, even in those days, was available and was useful in any part of the world. We lived upon our credit.
There is to-day some talk about international monetary alterations, about making a sort of international money. I implore the Government not to listen to any of these quack proposals. The £ sterling, whatever may be the nominal exchange, is recognised throughout the world as 123 grains of pure gold, and that sovereign is, I will not say legal tender, but is valid tender in any part of the world. It is the only payment of money that commands respect anywhere, because anybody, anywhere, in China, Japan, or wherever you may go will always take a £ sterling as 123 grains of pure gold. In China they have the tael, which is not a silver coin, but a silver weight, and the consequence is that in China you have to weigh out your money when you are paying a debt or buying goods. You weigh out your taels, and in every district they have a different value. It will be the same thing with us if we play the fool with our mintage and our currency. We shall have it by and by that if they are going to change the currency we shall have the ultimate settlement of international debts by weight. You will never be able, because of the differences of currencies in the different countries, to settle upon any international token for the settlement of balances of debts.
I pray the Government not to listen to any proposal for lowering the standard of the £ sterling. The £ sterling is current money throughout the world.

1071
What I want to insist upon is this: I am not opposing this £200,000,000 for the Exchange Equalisation Fund, but I warn the Government, as I did last year, that you may have £200,000,000, and you may run up the price of gold to 130, 140, or 150; you may be able to keep the price up, and to send it up, but you will never be able to maintain the price, even of gold. You can pay too dear for gold. You can control the price of gold in one way, and in one way only, and that is by buying everything that comes into the market, and you can make any price for it you like. To-day it is at a fictitious price entirely. It is easy enough to maintain it at its present price, but the day you want to realise your assets, what you have in gold or exchanges, if you stop buying, the price will go down. If you attempt to sell, there will be a regular rot in prices, and you will not be able to calculate what your loss has been.
Therefore you can go on controlling the market, and you can have a firm price, but eventually you will be in difficulties, and I will ask the Chancellor of the Exchequer, although I do not suppose he will answer me, What is he going to do when that time comes? There is too much gold in the world. There are no buyers of gold to-day, except the British Government, for any large quantity of gold, and the time must come when people will say to themselves, "The United States of America have £1,000,000,000 in gold, and France has about £600,000,000 or more. Are you going to continue buying gold? Are you going to bury it?" The consequence will be that the whole of your assets will be buried in the vaults of the Bank of England.
6.27 p.m.
Mr. MORGAN JONES: I am sure the Committee will feel indebted to the hon. Member for Putney (Mr. S. Samuel) for having given us so entrancing a speech. Whatever the truth may be about the opinions he expressed, I am sure we shall all of us be amply repaid by reading the speech in the OFFICIAL REPORT to-morrow. I have risen, not to discuss the more technical side of this subject, but in order to bring before the Committee an aspect of the matter which the hon. Member for East Edinburgh (Mr. D. Mason) brought before us. Last
1072
year we had several somewhat prolonged discussions upon this matter of the Exchange Equalisation Fund, and in particular the subject was raised as to how far the House should be kept informed by the Government as to the state of the fund. Various Amendments were moved on the Committee and Report stages, and those Amendments were supported by Members belonging to all parties in the House. Therefore, this is not a party matter but a real House of Commons matter. In the course of that discussion, I ventured, in common with many of my fellow-Members on the Public Accounts Committee, to try to advance to the Chancellor of the Exchequer some of our difficulties as members of that Committee in trying to function, as we are called upon to function, on behalf of the House of Commons itself. The hon. Member for East Edinburgh has recalled to the Committee this afternoon the nature of the undertaking which the then Financial Secretary to the Treasury offered to the House on the Report stage of the Finance Bill last year. I am afraid I shall have to make a little tax upon the patience of the Committee in reading a very long passage from the speech of the then Financial Secretary on that occasion. He said:
"Are we taking any risk and doing any damage to the traditions of this House or the control of this House by awaiting the results of nine months' work, until we see how we get on with the Exchange Equalisation Account, between now and the. 31st March, 1933, at which time the account will be made up? I think we are not, and I think it is unwise for the House to press for a greater disclosure than is provided for in this instrument."
These are the important words to which I wish to direct the attention of the Committee:
"Another opportunity will occur at a stage before any practical disclosure will have taken place, namely, the introduction of the next Finance Bill,"
that is, this year's—
"when all these matters will be brought under review. At that time"—
that is, during the discussion of the Finance Bill—
"we can discuss the matter with the advantage of the knowledge of nine months' working of the Exchange Equalisation Account, which will be open to all of us, not in a scrutiny of the books of the account but in the working of the exchange from day to day. That will be the occasion on which we can review the working of the account in the light of experience."

1073
In a subsequent passage, the then Financial Secretary delivered the passage which the hon. Member for East Edinburgh read, and at the risk of duplicating the quotations, I will read it once more:
"To meet that point I am perfectly willing to give a pledge to the House and to the hon. Member for Caerphilly, the Chairman of the Public Accounts Committee. First of all, the account will be made up on the 31st March next"—
that is, this year—
"The question of the publication of the year's result cannot arise until after that date. Secondly, there is adequate statutory authority for enabling it to be published with a report by the Comptroller and Auditor-General without making any Amendment in the o. existin Bill. If we find when the time comes that the accounts can be published, without detriment to the public interest, the Government undertake that they will certainly publish it, but if it seems necessary to them to withhold it from publication, they will before reaching a decision upon it consult with the hon. Member for Caerphilly, or whoever is at that time Chairman of the Public Accounts Committee, before the introduction of the Finance Bill, or at an early stage of its passage through the House."—[OFFICIAL REPORt, 9th June, 1932; cols. 2234–5, Vol. 266.1
Let me be perfectly clear with the Chancellor of the Exchequer. I in no way attribute to him any failure to carry out this obligation, because I think that he will be entitled to argue that, since that offer, which was made in response to arguments advanced in support of an Amendment which we then put before the Committee, was declined by us, he might quite understandably be presumed to withdraw his offer. Therefore, if that was his view, I cannot, obviously, attribute to him any failure to implement his promise. But an important issue arises from this matter. The position remains not merely the same as it was last year, but clearly more intensified. When the right hon. Gentleman appeared before the House last year he asked for permission to establish a fund of £150,000,000. Clearly, from the quotation which I have made, if there were nothing deleterious to the public interest, that account would have been published after 31st March of this year. Whether it will be published in full in the Public Accounts in due time I have no reason to know either one way or the other, but clearly we are in a more intensified position for this reason: without any knowledge of the actual state of the account at all beyond the assur-
1074
ance that the Financial Secretary gave us last week, we do not know where we stand in regard to the matter, and in that position of absence of knowledge the Committee is now asked to add another £200,000,000, to take a bigger leap in the dark, in a way, than we were invited to take, and did in fact take, last year.
The hon. Gentleman the Member for East Edinburgh asked a specific question of me, and he will see that the obvious answer must be that I do not know. He asked me whether I could give him the assurance that the Auditor-General, who is the financial officer of the House of Commons, had in fact examined these accounts. We as a Public Accounts Committee will not be called upon to examine the Auditor-General on the year's accounts ending on 31st March, until some time in January next. year. There fore nine months will have alapsed before the Committee will formally approach the accounts which have just closed. Therefore, I cannot give an affirmative answer. The answer must obviously be that I do not know, but I assume that the Auditor-General would know from time to time as an officer of the House of Commons the state of the Equalisation Fund. The second point which the hon. Gentleman asked me was whether I, in accordance with the passage which I have quoted, had been taken into the confidence of the Chancellor of the Exchequer. I take it that the Chancellor, in view of the fact that his offer last year was not accepted by us, did not feel bound by the offer, and therefore did not feel called upon to speak to me as Chairman of the Public Accounts Committee.
I repeat with all possible emphasis that with an account like this growing at its present rate—and though the Chancellor may not contemplate coming to us next year, and we hope that he will not; for all he knows, circumstances may compel him to—it cannot surely, from the House of Commons point of view, be a desirable thing that his finance committee should, in respect of this fund alone, have no sort of right to exercise the closest scrutiny such as it exercises in regard to other expenditure or funds operated by public departments. I, therefore plead with the right hon. Gentleman once again, not as a party man, but as a Member of the House of

1075
Commons, that the House of Commons shall be taken, if the right hon. Gentleman can devise some ways of doing it, more closely into the confidence of the Treasury through the Public Accounts Committee than can be possible under the present state of the law. The fact remains that this year, if this account is carried to £350,000,000, the accounts in respect of that money can only be certified by the Auditor-General to the Public Accounts Committee in the broadest possible way without any particularity whatever except to say that the account has been conducted in accordance with the provisions of the Act of Parliament. He cannot answer questions about it or disclose details. That surely cannot be satisfactory in view of the tremendous risks which an account like this undergoes, even if we accept the speech of the hon. Member for Putney as a guide. In view of those tremendous risks, it cannot be satisfactory that the appropriate Finance Committee of the House of Commons has no right—not privilege, but right—to examine this account in the name and on behalf of the House of Commons.
6.40 p.m.
Mr. BOOTHBY: The Chancellor of the Exchequer ought to realise that the House of Commons as a whole, although I do not think that there will be a Division on it, does consider that he is making a very large request. Some of us thought that it was a large request last year. It is so large this year as almost to become dangerous, and the Committee was deeply impressed by the speech of warning which was delivered by the hon. Gentleman the Member for Putney (Mr. S. Samuel). The hon. Gentleman the Member for Caerphilly (Mr. Morgan Jones) asked for greater information to be given to the House of Commons through the Public Accounts Committee with regard to the state of this fund, but I am bound to say that I cannot see how anybody can ever be properly informed as to the state or the condition of the fund at any given day from time to time, because nobody can know whether the fund is solvent or insolvent at any given moment from day to day. Nobody will know, as far as I know, the exact position of the fund until it is wound up.
Mr. MORGAN JONES: We should be satisfied from the House of Commons point of view if at the end of the year we could see what the operations of the year had been.
Mr. BOOTHBY: I am all in favour of the hon. Gentleman finding out what he can, but it is going to be a very difficult business for the Government to say with any degree of accuracy what the state of the fund is even at the end of the year. I doubt if it is a practical possibility. That is one of the inherent dangers of the situation. There is another reason, I think, for apprehension on the part of the Committee with regard to the operation of this fund. Surely the experience of the last six months or even the year has proved to everybody that whatever other form of international economic war may work, an exchange war will never work. The other side will beat you every time. We are not going to do ourselves or any country any good by manipulating the exchanges or, as the hon. Gentleman said, by Government speculation in order to manage the exchange value of sterling. Take what happened before the United States of America went off gold. The Financial Secretary to the Treasury knows very well, and everybody in the City knew, that what has become known as "the Control" was constantly in operation to keep down the exchange value of sterling. Sterling made repeated attempts to rise in relation to the dollar and this Control came in and bought large quantities of dollars and particularly of gold.
What was the final result of that? It has done no good whatever so far as our export trade is concerned, because when the United States went off the Gold Standard the Control had not the courage of its convictions. It had only the £150,000,000, and, in any case, it would have been too big a gamble. So that all that effort of the purchase of gold went for naught and the dollar stands at 390 to-day. Public opinion in America was to some extent exacerbated and aggravated during those weeks by the operation of the Equalisation Fund. Americans in New York and Washington have written to me that they got the opinion over there that we were using the fund to peg the £ at an artificially low level in relation to the dollar. I do not say that that in the end induced

1077
the United States to go off the Gold Standard. I believe the internal pressure from the Middle West was so great that that step would have been probable in any case, but considering that we gained nothing out of the whole of the operations I do hope that it will not be repeated in the months that lie ahead. What has happened? All that has happened as the result of these operations of the Control is that we have failed to keep the 2 down in relation to sterling, and we have landed ourselves with a great deal of gold, and the hon. Member for Putney has asked with great force and point what we are going to do with that gold, and particularly the gold we bold in the United States, which the United States at present refuses to allow us to export. I am all in favour of a reserve fund of this kind being at the disposal of the Government.
Mr. SMITHERS: Is it true that the United States have refused to allow us to export the gold?
Mr. S. SAMUEL: The point I made was that under the law of the United States the export of gold is prohibited, and I wished to know whether, if our Government wanted to ship that gold to England, and put it in the Bank of England, the American Government would allow that to be done.
Mr. BOOTHBY: I did not make myself quite clear. What I meant was that the United States had imposed an embargo upon the export of ordinary gold at the moment, but if we wished to bring back any large quantity of gold they might perfectly well say in the future—because, after all, they have refused to pay their external bond in gold—that acting in conformity with their general plan and owing to the conditions existing, they were unable to let us have that gold at any given moment. I think that is the point the hon. Gentleman wanted to make.
All that I want to say to my hon. Friend the Financial Secretary, if he is going to reply to this Debate, is that I think a great many hon. Members feel that while it is desirable that the Government should have at their disposal some large reserve secret fund to use in cases of grave emergency, it is not desirable that they should speculate in the exchange markets of the world
1078
with money voted by us. That will be particularly desirable during the few weeks that must elapse between now and the summoning of the World Economic Conference. I think it is quite possible, even probable, that the United States will embark in the course of next few days upon a, policy of pounced inflation. They may quite easily devalue the dollar by reducing its gold content, or embark on a large loan policy, and if that is the case it is by no means inconceivable that the dollar may fall sharply in relation to the pound sterling during the next three or four weeks. I think any hon. Member will view with great concern action by the Government to chase the dollar with the pound, using the Exchange Equalisation Fund for that purpose. Similarly, I do not think any hon. Member would wish to see the Exchange Equalisation Fund used for the purpose of keeping up the French franc under existing conditions, and maintaining the premium on gold which, as the hon. Member lightly said, I think, is at an artificially high level at the present moment.
I only put these points because I think the House ought to have some reassurance that in the very critical weeks that lie between now and the World Economic Conference the Exchange Equalisation Fund will not be used for keeping down sterling or bolstering up the franc, for example, because we might then get so involved that it would practically prove impossible ever to realise the assets of this fund, ever to wind it up at all. I come to this ultimate conclusion. The right hon. Gentleman will be well advised to leave the foreign exchanges alone unless and until he can get some international agreement at the World Economic Conference to try to achieve currency stability. In these arguments we are always driven in the end to the Genoa Resolutions. I have always maintained that one of the great tragedies of the world was that we did not wait until we could get some international agreement along the lines of the Genoa Conference in 1922 before we ourselves went back to the Gold Standard. The essence of those Resolutions was that before we went back to the Gold Standard we should obtain international co-operation and agreement, by means of central bank action, to keep the value of gold as steady as possible in teams of com-

1079
modities, thereby relating all currencies to gold by means of commodities, and by international action keeping currencies more or less stable.
That sort of solution is theoretically possible. I believe it is much more important than any tariff agreement or any debt agreement at the World Economic Conference, I believe it takes priority; and if the Chancellor of the Exchequer will devote all his attention to getting some international agreement along the lines laid down at the Genoa Conference he will have done more for the revival of world prosperity than anything else could; but until and unless we get that form of agreement I believe be will be well advised not to pursue the will-of-the-wisp of gambling in foreign exchanges in order to keep sterling at an artificially low level. He should give the House some assurance, before we let him have the money, that whatever else he does he does not propose to peg sterling down in relation to the dollar in the next few weeks or bolster up the franc at an internationally high level.
6.51 p.m.
Mr. DAVID GRENFELL: Unlike the hon. Member for East Aberdeen (Mr. Boothby) I will not venture to offer advice to the Chancellor of the Exchequer, but I share his view that we ought to have more information on this matter, when we are asked to trust the Chancellor of the Exchequer and the Exchange Equalisation Fund with an additiOnal £200,000,000. The fact that the total of the fund is £350,000,000 does not worry me very much. My apprehension arises over the procedure which we shall be following for 12 months. One can understand the feelings of the hon. Baronet the Member for Farnham (Sir A. M. Samuel), who said, in rather poetic language, that we were sailing an uncharted sea, and asked pathetically where we were going. The average Member of the House or the average man in the street does not know exactly where we are driving and I doubt whether the experts know. This is a very difficult problem, and I venture to approach it simply because I am an ordinary person. Indeed, I do not think the ordinary person is in any more danger, or in as much danger, of finding himself on some rocky outpost because it is an uncharted sea.
1080
As the Chancellor of the Exchequer truly said, things happen quickly in these days, and he would be a bold man who would prophesy what would happen (lays ahead or weeks ahead, let alone 12 months ahead.
While I admire the confidence of the Chancellor in believing that he can see straight ahead of him on the road on which he invites us to travel, and believing he can see the end of the journey, I do not share that confidence, and after the experiences of the last 12 months I do not think the Chancellor is justified in asking us to share his faith. Twelve months ago he asked for a total of £150,000,000, and I remember asking whether that £150,000,000 was to be raised as an immediate loan to be set aside and to be employed fully in the business for which this fund was established. The reply I had then was that the £150,000,000 was not to be spent in that way, but that the power to borrow £150,000,000 was then to be taken, and that as the business of managing exchange, of buying and selling, went on, the £150,000,000 would be drawn upon as necessity required. We are not told that the £150,000,000 has been fully thrown into the business.
I would not interpret what has been said as meaning that the £150,000,000 has been lost, certainly not, for there may be a profit, but the £150,000,000 is no longer available. The sum is not sufficient for the purposes of to-day, and so the Chancellor of the Exchequer says "Twelve months ago I came to you confidently, and appealed for £150,000,000, and now I ask you to add £200,000,000 to that £150,000,000." He has not told the House—it may be difficult, or, indeed, dangerous, to tell the House—but the House would be in a much better position to agree with the Chancellor of the Exchequer if it were told how this £150,000,000 has been employed. I think he has said that it has been almost entirely expended—or used up; it has been converted into something else which does not quite represent the original form in which the loan was made. We have not been told how much gold has been bought, for example. We have not been told how much gold has been retained. We quite understood 12 months ago that foreign exchange might be bought and sold freely, and that this £150,000,000

1081
might change hands in the processes described so well by the hon. Member for Putney (Mr. S. Samuel). It may have been turned over 100 times in the last 12 months.
We have not been told what is the net effect of these innumerable large-scale transactions in London, in the United States of America, in Canada, and on the Continent, carried out by the agents of this fund in order that the object of the fund should be fulfilled. We are not told how much gold has been bought or how much remains in hand, but we do know in a general way. I confess that I am unduly ignorant on this subject, and I hope the Financial Secretary will deal gently with me when he comes to reply. I would ask, Does the gold that is bought find its way to the gold reserve of the Bank of England, and is this gold which has been bought by this Exchange Equalisation Fund now represented in an additional reserve—a reserve which now stands higher than it has stood at any time since the War? It stands at a figure of £190,000,000. The gold reserve has been raised since the House gave authority to use this £150,000,000 by no less than £65,000,000 or £70,000,000. Is that in large part a result of the operations of this fund? I may say, in reply to the hon. Member who has interjected a reference to assets, that I will come to an examination of the value of the assets. There is no doubt that gold bought and set aside during the last 12 months has appreciated in value almost every day, and from that standpoint it has been a good business. If £60,000,000 sterling has been spent on buying gold at a price varying from £5 to £5 10s. or £5 15s. an ounce, then with gold now standing at £6 3s. 6d. or £6 4s. an ounce, it_shows a handsome profit. For the moment that gold is standing at a high price, and it is the largest measure of gold we have ever had in reserve. Gold is still appreciating in price, and there is no immediate danger in the fact that we have bought this gold. But what purpose does this gold really serve, and what advantage is there to us in adding to our reserve The Chancellor of the Exchequer hints that the times immediately upon us may be more difficult than those of last year. For the consolation of the Committee, he gives the impression that he sees beyond that brighter times when we have weathered the storm.
1082
What purpose is this gold to play? Why are we adding to the large accumulation we have, and why are we still buying more and more gold at higher prices in order to lock it up? Are we buying it for the immediate purpose of putting it in the Bank of England—in as inaccessible a position as if it had never been mined in South Africa, Kenya, or some other place? We ought to know the broad policy of the Government with regard to gold, the function of gold and the purposes to which it may be put. We have reached a dangerous position. Can the Chancellor of the Exchequer tell me what is the effect of all this buying of gold on the price of sterling? I would imagine that this offering of sterling for gold must entail a depreciation of the value of sterling, and appreciate the value of gold. Can the right hon. Gentleman give us an assurance that there is no danger to the world's finance from this sort of action? I am not satisfied that we can continually maintain an artificial value of currency.
There is grave danger in the buying and extracting of gold which has taken place in the last 12 months. As hon. Members have stated, companies have been floated and shares and stocks have been manipulated. There has been speculation and gambling. New mines have been opened, and a considerable stimulus to gold production has taken place, simply because of the artificial and, I believe, unnatural demand introduced from this country. We buy up large quantities of gold, almost the whole product of the South African mines. We buy large quantities of gold from India, and we find that more and more gold is brought into the gold markets, ostensibly for currency purposes but simply to be transferred from private persons all over the world to be hoarded up by Government. The United States, France and ourselves have been scraping up the gold of the world. With that gold buying, at enormous prices, I fear that this attempt to maintain stability of currency will result in the greatest danger to the real value of sterling. It is flying in face of what this House professes to do, and the World Economic Conference proposes to do.
If gold is bought at high prices, commodity prices must correspondingly fall.

1083
This evil, from which the world has been suffering, prevents any prospect of world recovery as long as this process goes on. The Minister of Agriculture, who was then the Financial Secretary to the Treasury, said 12 months ago that the object of this fund was to lay down rails upon which the trade and industry of this country might run smoothly. I do not think that these rails have been well and truly laid, or that we did a good thing for trade and industry when we embarked on this sort of currency legislation. Acting in rivalry with people who are doing the same thing, this is going to be detrimental to world trade and will diminish it. We are, I am afraid, doing the wrong thing. How is this gold accummulation now affecting commodity prices, and what prospect does a further accumulation of gold afford with regard to restoring world prices?
In Debates in this House the Government are always faced with a dilemma of one kind or another. There is the dilemma of their tariff policy; and the dilemma of their desire to expand world trade, and get more trade between ourselves and other countries. This Exchange Equalisation Fund is to be increased at the moment the Government are trying to come to voluntary agreements with countries for the increase of our trade. The Government must choose a plan, and not these three factors which are now in operation. The acknowledged effect of the tariff policy is a reduction of world trade, and the diminution of our trade with all parts of the world. Then the Government seek to reduce the deterrent defect of the tariff by special agreements with countries for the exchange of goods.
Finally comes this incalculable thing. Can the Chancellor of the Exchequer see the results of the operation of this fund, and that his confidence is fully warranted? I would like to believe that he does, and also that a reasonable proportion of hon. Members share his confidence and his belief that it is working to a definite advantage of this country; that it is indispensable to the maintenance of our trade, and that it does not vitiate the efforts of those working for the restoration of world trade. There are still some people who believe in the efficacy of gold. I do not think we shall see in our time a return to a real Gold
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Standard. It has not operated since the War. It has been stated that those who wish to buy gold are the United States, France and ourselves. We are buying more and more of this gold, scratching the earth and dispossessing people from their homes to get more of this thing. I cannot see any real purpose for all this.
I should like to believe that the Chancellor of the Exchequer can satisfy the Committee as to this plan for the stabilisation of our currency. In a wider settlement it would be an advantage for us if our £ did measure against commodities approximately equally day by day. It would be a mistake if we embarked upon a financial duel between ourselves and America, and took advantage of America by depreciating the £ as compared with the dollar. That would be a terrible mistake. France, America and ourselves are almost in the same position. We do not blame each other, because it is no use blaming people for their conduct in the last few years. The Chancellor of the Exchequer is not choosing his way, or he would have asked for £350,000,000 last year. He is now being driven to ask for £200,000,000, and he is not sure whether he will not be asking next year for still more money. I ask the House and the country not to be impatient with the difficulties of other countries, and to try to tackle our own problem so that we can join in, as soon as possible, with those suffering from the same difficulties. I hope we shall not pin our faith to gold, which must fail, but to international regulation and stabilisation of currency, which will relate currency to the volume of goods in the world and the markets of the world. In that way I think we can obviate the need for making application for an additional £200,000,000, which may well be lost to us.
7.12 p.m.
Sir H. SAMUEL: There are in the Bible two Books of Samuel. In this Debate there will be three, but that which I shall contribute will contain fewer chapters and verses than those valuable contributions given to the Committee already by my two hon, namesakes. The Chancellor of the Exchequer, at the outset, desired the Committee particularly to note his Budget declaration that this additional sum which is desired has no relation to the departure of the United States from the Gold Standard. I think

1085
that fact should be noted, should be emphasised and should be made widely known to the country in general. It is of great importance that in all these matters this country should not "get across the United States. I regret that one or two of the expressions used in the discussion this afternoon suggested that the action taken by the American Government, and Congress, has some unfriendly intention, and even may have had some sinister purpose. I agree entirely with the Member for East Aberdeen (Mr. Boothby) that it is not necessary to seek any such cause for that action.
America has had ample reason for the course she has taken in her own domestic situation, and I feel that she has been thinking more of the need, from her own point of view, of raising the prices of agricultural produce in dollars, for the sake not only of the agricultural community but the banks, mortgage and other financial institutions, than she has been thinking of the relative parity of the £ and the dollar. It would be indeed, as the hon. Member has just said, a profound misfortune if we should add fresh currency conflicts to the tariff wars which have done enough to upset commerce, and the quota wars which are worse still, but if, on top of both of those, we had currency wars, that would be the worst of all. It is bad enough for goods to be sold below the cost of production from one country to another, if such indeed occurs, but it is just as bad, or even worse, for currency below legal parity to be sent from one country to another, in an effort to secure advantages in the world's trade. I would draw the attention of the Committee to a paragraph in a recent article in the "Economist" on this subject, and I would ask the Chancellor of the Exchequer whether he has this particular point in mind, as I am sure he has. The "Economist" says:
"In any operations upon the New York exchange we would stress the need,"
that is, in connection with this Exchange Equalisation Account,
"for continual and close co-operation with the American authorities, who will most likely desire to exercise control from their side. Nothing would he more futile or disastrous than for there to be two exchange I accounts in existence, one in sterling and the other in dollars, which were continually pulling against each other, so that each
1086
bought up all the exchange which the other offered. Such a reductio ad absurdum must he avoided, but no doubt the authorities in New York and London have this danger in mind."
I think that the necessity of avoiding any such pulling in opposite directions is fully present to the Chancellor's mind, in view of the statement that he made to-day and the statement that he made in the Budget speech.
The second point which emerges very clearly from the Chancellor of the Exchequer's speech is that this is not a Measure to endeavour in any degree to control the major movements in the prices of sterling. As one or two hon. Members have said, if it were the object, that object would be defeated, because you cannot control those movements, either by a sum of £150,000,000 or by a sum of £350,000,000. I agree in general and whole-heartedly with what was said by the hon. Member for East Edinburgh (Mr. D. Mason) as to the importance of maintaining a sound, stable, honest currency, but I am bound to say that I do not agree with him when he suspects the Chancellor of being determined to keep the £ permanently below the value at which the free movement of economic forces would put it. In fact, the Chancellor himself said that he realises that if he were to attempt it, his attempts would be defeated. You may peg the £ against the small movements, but the great economic forces would tear out your pegs just as they were torn out in 1931.
There is only one other point to which I would refer. The Chancellor mentioned a new matter. He said that the only reason why he wants to increase the amount at the disposal of this Account from £150,000,000 to £350,000,000 is in order that he might safeguard London against the effects of withdrawal on a large scale and in a short time of short-term capital. We all have very much in mind the fact that we were forced off the Gold Standard just by that, far more than by any adverse balance of trade, except in so far as the adverse balance of trade may have contributed in any degree to weakened confidence: but the immediate cause was that, while the movement of trade might be adverse to the extent of £1,000,000 or 22,000,000 a week, the movement of capital affected the London money mar-

1087
ket to the extent of £5,000,000. £6,000,000 or £8,000,000 of money in a day. It was that which brought the Gold Standard down. The right hon. Gentleman says that the real reason why he wishes this larger sum is to safeguard us against the risks that are involved in a large accumulation in London of short-time money from abroad.
The effects of Government action are often shown by experience to be very different from the purpose which prompted that action. Again and again, Governments and Parliaments do a thing with a certain object and find, much to their surprise, that the outcome is very much the opposite. I feel some little doubt whether the action now being taken by the Chancellor will not attract more and more short-term money to London. The right hon. Gentleman's whole purpose is to make it secure against shocks. The more security—in fact this money comes here for the sake of security because it gets more security here than elsewhere—you give the foreign holders of this money, the more they will be induced to send their money to London and the greater becomes the mass which you will be endeavouring to control. In fact, it might in time reach uncontrollable proportions.
The hon. and learned Member for East Bristol (Sir S. Cripps), realising this danger, said that the Government ought to endeavour to cope with it, but in a different way, and he suggested that a tax should be devised for that purpose. It is very difficult to conceive any form of taxation which would achieve that object. I am bound to say that the hon. and learned Member and his friends are doing their very best to achieve the purpose that he has in view, namely, to keep away from London any money which might be deposited here for security. I have no doubt that if he and his friends succeeded in their political ambitions and in carrying out the financial policy and the schemes of taxation that they have in view, no one in any part of the world would dream of sending any capital to this country with any degree of security. It is the result of having a stable system of commerce and a reliable system of finance that you attract money to this country, and in so far as the right hon. Gentleman is taking steps to secure that stability and security, I think
1088
that it is inevitable that he will find that he will be attracting more money here. Still, so long as the security is maintained, that does not matter so very much, and the money, I dare say, can be put to good use.
We have to bear the penalty of relative stability. It is much better to have relative stability, with its penalties, than to have instability and insecurity. If the right hon. Gentleman's advisers think that, on the whole and in the main, it is wise to do this, in the general interest of the British financial and commercial system, Members of the House of Commons would be very diffident in taking another view. For my own part, in all these matters of international monetary considerations, I feel that the only thing that is certain is that nothing is certain, and that the only thing it is safe to prophesy is that every prophecy is likely to prove unsafe. I should be disposed to trust the Chancellor of the Exchequer and his advisers that the course that he is proposing to Parliament is one that it is in the interests of the country to adopt.
I only hope, feeling somewhat sceptical, as I do, of all transactions of this sort, that the facilities will not be used more freely than the occasion requires. Having this large sum of money, the Chancellor and his advisers should not think it necessary always to be using it in this way and that, in order to keep it continually employed. There is a risk, during catastrophic movements of world trade and finance, that at some time or other there may come a moment in which the assets of the fund may be very seriously depreciated, and some Chancellor of the Exchequer may have to come to the House of Commons and say that he is very sorry but, owing to unforeseen and wholly uncontrollable circumstances, the money that we had voted, or a large part of it, has unfortunately been lost. I hope that that will never occur, and that the World Economic Conference will take measures that will contribute to the establishment of a more permanent system of financial stability.
The monetary side of that Conference will be at least as important as the economic side dealing with tariffs and trade restrictions. To free international trade will conduce to monetary stability, but will not necessarily ensure it, and

1089
the monetary side is at least as important as the other. I hope that after the Conference has been held and the Chancellor comes to the House of Commons again next year, he will be able to say that the international position with regard to currency is so stable, that the pound is so secure and that fluctuations have been brought to so low a point, that it is unnecessary to continue this account. I hope that conditions will allow it to be wound up in the not very distant future, and perhaps we may express the desire, though possibly not the expectation, that when the Fund is wound up, there will be a sum of £50,000,000 or 260,000,000 in hand to be used for the reduction of the National Debt.
7.26 p.m.
Sir W. BRASS: I have listened to the whole Debate this afternoon with very great interest. What impressed me was that, although the Chancellor of the Exchequer asked us for another £200,000,000, in addition to the £150,000,000 he bas already, he did not actually tell us what had happened to the £150,000,000 which he has had up to the present time. That was left to the hon. Member for Putney (Mr. S. Samuel), who seemed to be able to tell us what had happened to the Equalisation Fund. He told us that £60,000,000 worth of gold had been purchased, and about £35,000,000 of dollars and that there was about £25,000,000 left in the fund. A sum of £25,000,000 is not of very much use when you are trying to iron out exchanges, and consequently I agree with the Chancellor of the Exchequer that it is necessary that we should have more money in the Equalisation Fund. This fund has been very useful in the past, and I feel great confidence in the Chancellor and his advisers that they will not use it for gambling purposes, but purely for trying to keep the exchanges as near stable as possible, and that there is no attempt, as he told us quite distinctly, by himself or his advisers to keep the £ below the dollar in any way. This fund is to be used in just the same way as it was used before, and that is to try to keep the exchanges as level as possible, so that the export trade of this country can continue to be as large as possible.
There is one danger in this. My right hon. Friend told the Committee that this fund had not made a loss, but he did
1090
not say that it had made a profit. That is quite all right, as long as it is not liquidated. The difficulty of these big transactions is the question of liquidation. I would impress upon my right hon. Friend the importance of liquidating this fund as early as possible. There is no doubt a danger that things in the future may be even more complicated than they are at the present time. During the Economic Conference the Prime Minister told us to-day, the debt question was not going to be discussed. That might disturb the exchanges very much indeed. I trust the Chancellor implicitly. He has got an extra £200,000,000 in his fund, and I hope that he will not be tempted to try to keep the £ more stable than he is able to do with that limited amount of the extra £200,000,000. I think we may have complete confidence in him and his advisers. For myself, I propose to support the: Government, but I want to utter this word of warning, that there is a chance that possibly one day, if things did no', go quite right, the Chancellor might have to come to the House and say, "Unfortunately, things have not gone very well with the Exchange Equalisation Fund, and, as a result, we have to come and ask the country to pay more taxes." I hope that that will not happen, and I do not think it will, but I must utter that word of warning.
7.31 p.m.
Mr. CHAMBERLAIN: I do not think it is necessary for sue to say very much by way of reply to the discussion on the Resolution which I have submitted to the Committee, because, while there have been some very interesting speeches, and certain warnings have been addressed to the Government, there has not been anything in the nature of what I might call determined opposition to the proposal which I have made. I would, however, emphasise once again that we are not proposing to utilise this fund for any other purpose than that which has been so often stated, namely, for removing undue fluctuations in the exdhange value of the £.
The right hon. Gentleman the Member for Darwen (Sir H. Samuel), while giving general support to my proposal, uttered a word of warning as to the danger that we might actually, by our proposals, increase the flow of short-term capital into

1091
this country, by reason of the fact that we were creating greater stability, and, therefore, making this country a more desirable resting place for that capital. Of course it is perfectly true that, the greater the stability here, the greater the attraction, and I think it is possible that in many cases some of this capital which I have described as refugee capital will like its quarters so much that it will stop here more or less permanently. I agree with the right hon. Gentleman that, if confidence is increased by the measures we are taking here, it may very well be that more of that capital will stop here. But, even then, it must be recollected that that money is moved, not so much on account of conditions here, as on account of conditions in the places from which it has been moved, and whether it stops here or goes back is really much more closely related to the conditions of its place of origin than to the conditions here. Therefore, while I do not deny the logic of the right hon. Gentleman's suggestion, I do not think we have anything to fear on that account.
A good many hon. Members, while generally accepting my statement of our intentions as to the use of this fund, have expressed the hope that I shall not be tempted into more speculative courses from time to time. As far as I have been able to make out, I have not earned a reputation for daring adventures and gambles of one kind or another; I thought I had rather been reproached with too little imagination in financial realms; and I do not think that there is any danger, at any rate so long as I am here, that we shall try to control the exchanges of the world, or that we shall, on the other hand, endeavour to make some colossal coup which would wipe off the National Debt, or something of that kind, by the operation of this fund.
My hon. Friend the Member for Putney (Mr. S. Samuel) gave us a disquisition which very much interested the Committee, and which enabled many of us, perhaps, to see a little more closely into the operations which we are discussing here in general than we had previously visualised; but perhaps I may say to my hon. Friend that part of his speech, so far as it was in the nature of criticism of the Government, was really founded on a misapprehension as to what we are
1092
proposing to do. His argument that we had tried to control the exchanges really would have no value unless it were supposed that that had been our object; but, when he accused us of being responsible for the boom in mining shares and speculations on the Stock Exchange in gold shares, I really was rather surprised, because I should have thought that a man so familiar with these matters as he is would have had in mind the fact, which is well known to all of us, that it was when South Africa went off the Gold Standard that these things occurred, and they really cannot be laid at the door of this Government or of any result of the working of the Exchange Equalisation Account.
I do not think I am called upon to answer my hon. Friend the Member for East Aberdeen (Mr. Boothby), who popped in in the course of the afternoon, not having heard my speech, and delivered a series of warnings to me which I am sure he would not have troubled himself to deliver if he had been present earlier and had done me the honour of listening to my speech. I may, perhaps, express the hope that he would have been impressed by my speech, as well as by that of my hon. Friend the Member for Putney, but he did not have the good fortune to listen to either of those speeches.
Mr. BOOTHBY: I certainly did not hear the whole of the right hon. Gentleman's speech, but I took particular care to ask two of my lion. Friends who had heard the whole of it, and who gave me a verbatim and, I think, very accurate report.
Mr. CHAMBERLAIN: I will leave that matter to those who were here. I want also to say one or two words about the question of publicity, which was raised by the hon. Member for Caerphilly (Mr. Morgan Jones), who, I understand, has had to leave the Committee for another engagement. As he truly admitted, an offer was made last year to consult the Chairman of the Public Accounts Committee on the question of publicity, but that offer was not accepted, and, as it was not accepted, I considered that it was withdrawn, and that we were under no obligation to fulfil it. But, although the matter has not been pressed this alter-

1093
noon, I think the Committee is entitled to hear a word from me upon this question of publication. Here is, as has been said, a vast sum of money, hundreds of millions, entrusted to the care of the Government and to be operated on in private, with results which are not disclosed to the Committee as they go along; and it is represented by the Chairman of the Public Accounts Committee that it was an anomaly that, in this one case alone, the Comptroller and Auditor-General, who is obliged by the Finance Act to certify whether the operations of the account have been carried on in accordance with the Statute, is not called upon to come before the Public Accounts Committee and answer questions addressed to him by its members on this subject.
What are the sort of questions that they might address to him? They have been clearly suggested by the hon. Member for Caerphilly. He would want to ask, "What has been done with this sum of money? In what form has it been held from time to time? What were the resources on such-and-such a date? What was done when certain circumstances arose? What action was taken, and what was the result of that action?" These would be reasonable questions to ask and answer if they could be safely answered to the Public Accounts Committee, or even to. Members of the House, without giving the same answers to the whole world; but, 'as I pointed out earlier, that is really the difficulty in which we are. As far as we are concerned, we would gladly disclose all these matters to the Public Accounts Committee if the matter could stop there, but the trouble is that our principal object in the operation of this fund is to counteract the operations of speculators, and, by publishing what was the condition of our account at different times and in different circumstances, we should be furnishing to them just exactly the information that they would wish to have. When the amount of the Fund has been altered by so large a sum as that which we are discussing this afternoon, there would not be quite the same difficulty about disclosing what had happened when the fund was in a very different condition, because, obviously, it would be of no use to speculators now to know what was happening
1094
when the resources of the fund were much less than they are to-day. But we cannot tell whether that will continue to be so in the future. While we should be safe from any danger in this year, in another year we might find ourselves seriously embarrassed. I hope very much that, for the reasons which I have given to the Committee, we shall not be pressed to go further than we have gone into the details of the account. There will be further opportunities of discussing this matter when I move the Second Reading of the Bill in the House, and I hope that the Committee will now be able to see their way to let us have the Resolution.
Resolution to be reported To-morrow.

ORDERS OF THE DAY.
  WAYS AND MEANS.
    REPORT [1ST MAY].
    Resolution reported,

    REDUCTION OF CUSTOMS DUTIES ON CERTAIN MUSICAL INSTRUMENTS, CLOCKS, ETC.
    "That, for the purpose of enabling effect to be given to an agreement regarding commercial relations embodied in an exchange of notes dated the thirteenth day of April, nineteen hundred and thirty-three, between His Majesty's Government in the United Kingdom and the Government of the German Reich, the duties of customs now chargeable under Section three of the Finance Act, 1925, on goods of the descriptions specified in the first column of the Table annexed to this Resolution shall, as from the eighth day of May, nineteen hundred and thirty-three, be chargeable at the reduced rates respectively specified in the second column of the said Table.
    And it is hereby declared that it is expedient in the public interest that this Resolution shall have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.

    TABLE.

    Description of Goods.

    Reduced rate of duty.

    Pianos, non-automatic; and component parts and accessories thereof.

    20 per cent, ad valorem.

    Piccolos, flutes, clarinets, flageolets, bassoons, and cornets; and component parts and accessories thereof.

    20 per cent, ad valorem.

    Description of Goods.

    Reduced rate of duty.

    Stringed musical instruments and component parts and accessories thereof.

    20 per cent, ad valorem.

    Gramophones without electrical amplification, of a value not exceeding 10s. each.

    15 per cent, ad valorem.

    Gramophones without electrical amplification, of a value exceeding 10s. each.

    20 per cent, ad valorem.

    Concertinas of a value not exceeding 35s. each.

    15 per cent, ad valorem.

    Concertinas of a value exceeding 35s. each.

    20 per cent, ad valorem.

    Mouth organs.

    10 per cent, ad valorem.

    Clocks, alarm (other than electric clocks) of a value not exceeding 30s. each.

    20 per cent, ad valorem.

    Clocks (other than electric or alarm clocks) of a value not exceeding 30s. each.

    25 per cent, ad valorem.

    Clock movements complete (other than movements of electric clocks) of a value not exceeding 15s. each.

    25 per cent, ad valorem."

    Motion made, and Question proposed, "That this House doth agree with the Committee in the said Resolution."
    7.45 p.m.
    Mr. LAWSON: It struck me, when this matter was debated on Monday, that in some respects the Committee rather seemed to forget the conditions under which this agreement was entered into, and I think the President of the Board of Trade himself was not quite sure at times. I think it is very necessary for the House to understand at the outset of this Debate that, if this matter has been linked up with negotiations under the Import Duties Act, neither the miners, the coalowners nor the coal trade are in the least to blame for that. If the coal trade is set in opposition to other industries, it is because it has rather been the victim than that it had the will to be placed in this position. Here are the facts, if I may repeat them not only as the President of the Board of Trade repeated them but as one who saw the results of this cutting down of the quota at first hand in their effect upon those engaged in the coal trade. We were alarmed in October, 1931, in the mining area of the North when we learned that the licensing quota of export coal to Germany had to be cut down from 420,000 to 300,000 tons. We were
    1096
    still more shocked when we learned that it was soon to be reduced to 100,000 tons.
    We saw collieries around us at once closed down. We could place our fingers on men and say that they were made idle directly as the result of that. That was 18 months ago. Members for the mining constituencies raised the matter in the House and found that the President of the Board of Trade himself was just as much alarmed as we were. Indeed, following up questions that were put to him, he ultimately gave answer to me that the action taken by Germany was inconsistent with their obligations under the Anglo-German Commercial Treaty of 1924, being discriminatory against this country. Indeed, the Government felt so strongly on the matter that they instructed our Ambassador to make protest against the violation of this Treaty. The right hon. Gentleman the Member for West Birmingham (Sir A. Chamberlain) was quite right in insisting that this was a matter that stood by itself as a violation of the Treaty, and it was not necessarily from his point of view, a matter that was affected by the Import Duties Act. But we were concerned to know what the Government was going to do and from October, 1931, until the present time, so far as we are concerned in the coal trade, nothing effective has been done until this agreement was submitted.
    There are Members in the House who have said—one hon. Member in a very forthright speech—that, of course, this position was due to the fact that world consumption had decreased. He also said it was due to the decreased consumption of coal in Germany. I wish to join issue with him. Germany is no better now than she was 12 months ago as far as internal consumption is concerned. Indeed, she is worse. But Germany can now license 180,000 tons against the 100,000 tons which she has been taking for the last 12 months. That justifies the theory that we laid down at the very beginning of this crisis that Germany had lowered her quota in order to place herself in a bargaining position in view of the new tariff policy of the Government, and that we were the victims of that policy. Now we have been justified in the line that we pursued by the very fact that Germany has insisted on bargaining on that basis and demanding something before she allowed an increase of the

    1097
    quota. So the net result of the tariff policy to us in the coal trade is that, whereas we were allowed 420,000 tons a month, we have now to be thankful for 180,000 tons a month. We say to the Government that, placed in the position we are in, we are compelled to accept this crumb which falls from the tariff table, but we say, Thank you for nothing.
    Mr. MARTIN: If the hon. Gentleman is joining issue with some statement that I made, do I understand that he disputes my figures about the German consumption of coal?
    Mr. LAWSON: No. I did not bother to deal with the figures, for the very simple reason that the case is unanswerable. Germany can take 180,000 tons of our coal to-day as against 100,000 tons in the last 12 months. Her position is not only no better now than it was 12 months ago, but is worse, and that simply proves that she has been holding herself for bargaining. That is the case that I put up. The House knows very well—we in the North of England perhaps know at first hand even better—that no one can drive a better bargain than the right hon. Gentleman, but, of course, he is the victim of his own circumstances, and I really do not understand why the people who have been responsible for framing this policy—I do not know whether it is a Birmingham or a Bournemouth policy—should find fault, because in the circumstances it seems to me that this is the kind of thing that will happen and the kind of criticism that the Government will have whoever is bargaining.
    I agree with those who have said that really it is not a very good bargain. It is a very doubtful bargain. The Germans do not guarantee to take 180,000 tons at all. They simply give us a licence for exporting that amount of coal, but, of course, they are sure that they are going to get a lower tariff. How do we know—this is very strongly held in the coal trade —that the Germans will not even manipulate this agreement to suit themselves? They have a preferential tariff on the railways. They subsidise their coal to the free ports. How do we know that they will not increase the subsidy to the free ports and thus make it possible to bunker their own ships so that in effect what they may seem to give us with the one hand they actually take away with the
    1098
    other? Then, of course, with the present feeling prevailing in Germany, I should not be surprised even if Mr. Hitler decides that anyone who imports coal into Germany is not of true German stock. With the situation developing as it is there, really anything might happen. I put it to the right hon. Gentleman that it is a very doubtful bargain that we have, inasmuch as it is just possible that they might tend to subsidise coal and thus bunker their own ships.
    We were told when a tariff policy was decided upon, that it, was to unite the nations. I remember the roars of cheers that at last we had a policy which was going to make us a united Britain economically in the face of all the world. It was a sort of face-the-four-corners-of-the-world spirit that was prevailing. I could not help thinking of the scenes that took place at that time and compare them with what took place on Monday. I am sure the average visitor who saw the division of opinion and the tug-of-war between various Membars would certainly not have thought that the policy that was set out by the Government was a united policy. As a matter of fact there were times when it seemed to me that it was a kind of economic cup tie between Birmingham and Newcastle. I suppose the next match will be' fought with Cardiff. We are really in for some very striking schemes in the next few months if the kind of thing that took place on Monday is any indication of what is going to happen.
    We in the coal trade object to being placed in the position of getting some particular advantage over poor workmen in Birmingham or some other part of the country. We were very sorry for the minority. There is a kind of fellow-feeling among minorities; we have had some experience of them in the last 18 months, and have been not unused to them even before that. So we tried to come to the rescue of the hon. Gentlemen on those benches. We were so sorry for them that we went as far as that. We always desire to give help to the weaker brethren. But we also expect them to help themselves. That is the good old British principle. So we were shocked, after coming to the rescue, to discover that some of their own Members had actually gone away. I understand that all that was necessary was

    1099
    the presence of the Chief Whip at the door to convince those Members at once, with that convincing smile of his, that the Government was right, and at once they were gone. There were even vulgar people who said something about election expenses. We would not suggest that for a moment, but there were certain people who did suggest it.
    I gather that to-night and next week a real attack is to be made upon the Government. We wish them well. This is an Agreement which gives licences for a million tons of coal a year. Yes, but the Government has been taking 2,000,000 tons a year from the coal trade by its policy in the last 12 months. There is a nice sum of evidence now that the Government policy evoked this spirit in Germany, as is shown by the negotiating facts expressed in this Resolution. We are not going to say on this occasion that we can refuse to accept what has been achieved. We are placed, as an Opposition, in this position, and we have to accept any little crumb that falls from the tariff table. We can do nothing else, but we give the Government no thanks for it. Quite frankly, if we could go into the Lobby with real fighting men, with men who mean business when the fighting begins, people who are not afraid of the issues, in order to bring down this Government which is responsible for the policy, those men would have 100 per cent. of our support tonight. But the position as expressed in this German agreement is not at all a hopeful one for the coal trade of this country. It would have been far better if the Government had attended to the fundamental facts connected with this industry, with its organisation and with all the things that so badly need the Government's attention. I received this morning an article from a man whose qualifications and authority will not be doubted: Mr. Archer, who is interested on the export as well as the production side, and who has written very ably upon this subject. He says quite clearly here that:
    "Coal is a simmering source of international mischief. There is not, it seems to me, the remotest hope of a solution of the European coal problem apart from political action."
    All through his argument this gentleman expresses what all well-wishers of
    1100
    the coal trade and those who know it intimately feel, that there is a very great need indeed for close Governmental attention and Governmental action of a fundamental kind in connection with the coal trade if it is to face the future.
    Mr. ISAAC FOOT: Will the hon. Member kindly say from what paper he is quoting?
    Mr. LAWSON: I was quoting from the "Coal Merchant and Shipper" of 29th April. But I could go on to read columns of warning that, desirable as it is that the members of the coal trade should settle their own troubles voluntarily, it is urgently necessary for the attention of Governments to be given to this important matter.
    I cannot sit down without warning the House that at the present moment a situation is looming up which, while we are discussing it, means an increase of 80,000 tons a month or 1,000,000 tons a year and which, unless it is firmly handled at a very early date, may result in the loss to us of a great deal more coal than we have gained in this German agreement. All men who know the trade well and intimately and have given the best of their experience and time to it, know that during the past 11 months there have been warnings, urgings and intrigues, but, so far as we can gather, nothing of real effect is being done. Both on its national side, in view of the termination of the agreement, and on its international side the coal trade, if it receives the attention to which it is entitled, can bring to this country prosperity and an increase of exports and of general well-being beside which this infinitesimal agreement pales into insignificance.
    The gentleman I quoted and many others are strongly of the opinion that it is most necessary on the constructive side not only that the Government of the day should give its attention to the trade for constructive purposes, but also that it should give that attention to other countries which produce coal. As far as this agreement is concerned, I reptat that we have nothing for which to thank the Government. We accept it under pressure. If the people who are fighting the Government really meant business, we would go as far as we could to bring the Government down. As things are, we have to accept this situation, but

    1101
    it would be infinitely better if the Government had given the necessary attention to the constructive side rather than to using the coal trade for this purpose.
    Right hon. and hon. Gentlemen need not run away with the idea that it is going to be a case of Birmingham against Newcastle, North against South, engineers against the coal trade, some other industry against agriculture. That is the position now, as far as industry is concerned, according to the policy: a splitting-up policy, a policy of antagonism. But we on our side will see to it that the workers in those industries are not lined up one against the other but against this policy, which means not only the undermining of the standard of living and probably the wrecking instead of the strengthening of these industries, but also the threatening of some of them with very grave dangers. We can rely upon the great mass of the workers to line up with unity at the very first opportunity, not for a policy of disintegration but for a policy of Socialism, commonweal and organisation, which is the only solution to these problems which we have to face to-day.
    8.11 p.m.
    Mr. AMERY: I should like to begin by assuring the hon. Member who has just sat down that the last thing that those of us who criticise this agreement would wish to do is to grudge in any way any relief that we may secure, by negotiations or otherwise, for the hard-pressed coal industry. Nor do we grudge concessions that might be made to secure an adequate result, merely because those concessions affect our own constituencies or the part of the country which we represent. I hope that in this matter we shall look at these problems, not from the point of view of separate interests and separate localities, but from the point of view of the general national industry. It is certainly only from that point of view that I rise to object to the agreement which is embodied in this Resolution. I do so, not because I object to making bargains with other countries, but because I consider this to be a bad bargain. I object, not because I have failed to realise that in bargaining concessions may have to be made, but because I think that in the present instance the concessions made are unnecessary and in any case are calculated to inflict more damage upon industry and deprive more
    1102
    men of employment than would be counterbalanced by the help which industry, as represented by coal, could be said to receive from anything that has been secured from Germany.
    It is on those points that we wish to have a good deal more information from the President of the Board of Trade than that which he vouchsafed in the rather cavalier speeches which he delivered to this House on Monday. We have heard nothing so far to show either why any concessions were required to secure from Germany what the hon. Gentleman has. claimed to be our right, or why concessions on this scale were necessary. I need not repeat the circumstances, but we have been told more than once from that bench that the German restrictions upon our coal quota were a definite discrimination against our coal industry compared with other countries and, consequently, a violation of our Trade Agreement with Germany. I quite agree that it might have been inconvenient to refer to arbitration. It may alse be that the most-favoured-nation Clause prevents us from applying Section 12 of the Import. Duties Act to Germany, a Section which. was expressly devised to give us power to, deal with other nations which discriminated against our industry. But the President of the Board of Trade has never so far answered the question why concessions were necessary, when the whole trade position between Germany and ourselves gives us a lever upon Germany, a position of infinitely greater power than any other country has ever enjoyed in industrial negotiations.
    As long as Germany sends to us more than twice as much as we send to her, we are in a position not of giving, but of asking concessions. We are doubly justified in demanding concessions when we believe those concessions to be, not in the true sense of the word concessions, but a mere recognition of our Treaty rights. The point of view of the President of the Board of Trade seems to be in every negotiation to give concession for concession regardless of the background. If that is to be the line to be pursued, then I imagine that when he has finished with the larger trade negotiations with Germany which he contemplates, we shall still be left with the position that Germany is sending us twice as much as we send her. That may be the point of view of the President of the

    1103
    Board of Trade, but it is not the point of view from which this House passed the Import Duties Act.
    Let me come to the particular industries which are being made the victims of his effort at bargaining—an effort with which he seems to be quite extraordinarily satisfied. We have had no reply of any.sort to the facts and figures adduced in the course of Monday's Debate; no attempt to explain or argue that casual figure of 1,800 who might lose their employment if these remissions take their maximum effect. I think it would be desirable that the President of the Board of Trade should do what he did not do on Monday, namely, give some sort of answer to the powerful statement made by my hon. and gallant Friend the Member for Central Glasgow, President of the National Union of Manufacturers, with regard to the chemical industry. I should be glad if he could give some sort of answer to the case which I made with regard to the watch and clock industry, a case in which the question is not only one of loss of employment to an existing industry, but of the checking of a most promising and hopeful development, which may involve the employment of many thousands of workers.
    I need not deal with the jewellery industry, with which my right hon. Friend the Member for West Birmingham dealt. I received this evening a telegram from the Birmingham jewellers' Association which not only points out the hardship and loss of employment likely to be incurred by that industry, but refers to the negotiating capacity of my right hon. Friend the President of the Board of Trade in language which, I am afraid, I cannot possibly read out to this House. To take another industry, I should like to give the single instance of a letter which I received to-day. In this case the industry is the toy industry, to which the President of the Board of Trade referred in unduly disparaging terms, considering the efforts which his department and the Department of Overseas Trade made for years to try to encourage the British toy industry to recapture the market in this country. This is what this firm says:
    "Two years ago, when … the long-sought-for Tariff on imported toys was at length attained, British toy manufacturers prepared to develop their businesses. We
    1104
    ourselves here spent £25,000 on new factory buildings and toy-making plant, in addition to further expenditure at our Wellington factory, while we acquired on a 21. years' lease another large factory in London for the sole production of wooden toys such as had hitherto been imported from the Continent.
    We found the 25 per cent. Customs Duty was barely sufficient to protect our new activities … but the Tariff offered us just sufficient encouragement to proceed, and the removal of, or substantial reduction in, this Tariff, must have but one inevitable effect—the closing down of new industries almost before they have properly started and after considerable expenditure of money has been made.
    We consider the assertion that the cessation of these activities cannot affect more than 1,800 workpeople throughout the country must be entirely erroneous. From our new London factory alone we are dismissing 100 people and are giving instructions for the factory to be closed and the plant disposed of forthwith, as we know the futility of attempting to produce goods for which there could be no sale. How many more people we must discharge from our Harborne and Wellington factories, remains to be seen."
    After speaking of the difficulty of industry knowing where it stands in the present position, they go on to say:
    "We think that before taking any steps in this matter the Board of Trade might at any rate have investigated the condition of the toy trade in this country, and have taken steps to see that British toys could be exported to Germany on terms as least as favourable as those applicable to German toys imported into this country."
    Nothing has been said throughout the discussion as to what the German rates of duties are on the articles on which we have made concessions. I think that that is a matter well worth considering.
    To come back to the general issue, I cannot help feeling that the inadequacy of the answer given by the President of the Board of Trade was largely due to the fact that he did not take the trouble to consult the industries in question. He told us on Monday night that it really was no use, in the midst of these negotiations, to consult with those industries, because they would all with one accord have said that they could not afford to have their tariffs interfered with. Really, that is not the point at all. Of course, they would have said so. What matters is, not what they would have said in that respect, but what information they would have laid before the President of the Board of Trade to justify their case. It was information that it was his business to secure, not agreement.

    1105
    From the facts and figures which have been supplied to the House, it looks to me as if the President of the Board of Trade went into this matter without the information which he ought to have had at his disposal. He certainly did not fail to get information with regard to the export trade in which he was interested—the coal trade. To quote his own words, he had the amplest and fullest stores of advice from the Mining Association. Why should he not have had the amplest and fullest stores of advice from the other industries affected It may very well be that in the case of some of them they could themselves have suggested a reduction in certain directions which would not have hurt appreciably, or which would have hurt them least, or at least have convinced him on other points where concessions could have been obtained.
    I will put this question to the President of the Board of Trade: Does he think that Germany in the course of these negotiations consulted only her export industries—clocks, music and toys—and did not consult the German coal industry, whose interests might have to be prejudiced? Of course the Germans consulted all their own people, right through, and I suggest that if the President of the Board of Trade had been doing his work properly in this business he would have consulted every industry which was affected in this matter. He tells us that he had all his own information; that he had information available to the Advisory Committee. He said: "We pooled our information." But it was made quite clear by the question of my right hon. Friend the Member for West Birmingham that there was no question of following the advice of the Advisory Committee. The Advisory Committee was simply brushed on one side in this matter. This question is really the most serious which has been raised by this whole transaction.
    The action of the President of the Board of Trade—I am sorry he has gone away—cuts right across the whole principle on which the Advisory Committee was established. Here we set up an impartial judicial body, to which industries are compelled to go if they are to receive any measure of Protection. They are told that they cannot exercise political pressure upon their members. They cannot bring their case before Parliament and before the Department. There is only one door
    1106
    through which they can enter into security and that is the Advisory Committee. Moreover, the Advisory Committee are equipped with very remarkable powers. They can insist on a. very close scrutiny of an industry. They can lay down conditions as to reorganisation, and as to the expenditure of large sums of capital. Finally, when they are satisfied on every issue, they make their recommendation, and in certain cases they couple that recommendation with some sort of guarantee of security. The question that arises to-day is, what is that guarantee worth? On Monday my hon. Friend the Member for Central Sheffield (Mr. Boulton) pointed out that in the case of the razor blade industry, the increased production that has taken place has been on the assurance of five years' continued protection from the Advisory Committee. What is the view of the President of the Board of Trade on that question. He said:
    "… The Advisory Committee had said that they themselves, speaking only for themselves, did not propose to make any further recommendation for a period of years. We did that because in our view … the protection which was still in force was sufficient for the purpose."—[OFFICIAL REPORT, 1st May, 1933; col. 63.5, Vol. 277.]
    "Speaking only for themselves." Now we know what importance the President of the Board of Trade attaches to the Advisory Committee. Now we know what value a recommendation of the Advisory Committee has to the industries of this country. Really, we cannot have it both ways. When an industry wants protection, the Advisory Committee is all powerful. It can refuse an application or grant it, on any conditions it likes. But when it occurs to the Minister in the course of negotiations to brush aside the Advisory Committee, then we are told the Advisory Committee are nothing. They only speak for themselves. They are just Messrs. May and Powell, or whatever the names of the gentlemen may be. They have no authority. People who risk their capital in reorganising their businesses and find millions of money on the strength of the recommendations of the Advisory Committee, well, they are mugs. That is the fact put before us.
    When it comes to saying that the Advisory Committee eliminates political pressure, it only eliminates political pressure in one direction. It is a one-

    1107
    way traffic. If air export industry wants a concession in any foreign country, it can go and put up its case. It can give its amplest and fullest advice to the President of the Board of Trade, saying: "We must have this concession; pay anything you like for it." But those who are to be sacrificed in that case in the home market are not even informed. They wait until one morning they open their newspapers and find that the whole foundation upon which they are building up their industry and employing their workpeople has been taken away from under them. They have had no opportunity to put their case. The industries affected have hardly had time to meet and put a reasoned case to communicate to Members of Parliament. We have had telegrams from them, but they have hardly had time to make any other statement.
    It seems to me that the whole scheme of the Import Duties Advisory Committee and of the Import Duties Act becomes meaningless if we are to adopt the President of the Board of Trade's point of view. It is quite clear from the speech delivered on Monday night that beyond the 10 per cent. revenue duties the right hon. Gentleman regards all the other duties as being, if I may use his phrase "bargaining material," put on in order to give him an opportunity of taking them off again for what he may consider an equivalent concession from some other country. If that was the idea, what on earth was the good of creating an Advisory Committee and putting industries to the trouble and expense of proving a case, so that they could get protection sufficient for themselves, and not to affect other industries? If that was the point of view, why not have put on a 50 per cent. tariff all round and given plenty of margin for a reduction, so that the President of the Board of Trade could play about with it? I do not believe for a moment that that was the view of the House of Commons.
    The House of Commons always believed in our particular circumstances that the strength of our position in this market would enable us, once we had a tariff and once we could threaten to raise that tariff, to get valuable and important concessions. The House no doubt also contemplated, and ought to contemplate, the
    1108
    possibility in the course of large and extensive tariff negotiations that some reductions would have to be made that involved sacrifices. Nobody would deny that, but it was also contemplated that, in the main, this country was in the future to have the employment of its workpeople and the capital sunk in its industries secure against fluctuations in the world outside, secure against lower wage scales and lower scales of taxation. The whole object of the policy to which the House gave its assent a year or more ago was to give security to British industry. The power of bargaining and negotiating only comes in in so far as it is compatible with reasonable security to the main body of British industry.
    Industry to-day wants to know where it stands. All that it knows at this moment is that any confidence it had in the Import Duties Advisory Committee it is not justified in holding any longer. They are a body of gentlemen who speak only for themselves. They count for nothing in particular in the eyes of the President of the Board of Trade. The industries know also that the President of the Board of Trade is contemplating negotiations on a much larger scale with Germany and, apparently, on the same principles as those which he has so successfully, in his own estimation, just concluded. We are told by the right hon. Gentleman that the list of the industries that are being sacrificed
    "is a comparatively small one covering a small range of industries, not commensurate with the bigger negotiations which must be conducted in future. It is essential to make concessions in order to purchase an advantage."—[OFFICIAL, REPORT, 1st May, 1933; col. 528, Vol. 277.]
    Evidently the concessions that are to be made in the future in order to get something from Germany, and I suppose something corresponding from other countries, are going to be much larger in their scope and will affect far larger and more important industries than anything of which we have had a foretaste in the present agreement. If that is the ease, then heaven help the industries of this country! We have been told by the Government again and again that the one thing that is needed is confidence. Condence is needed to thaw the frozen credits in this country. Confidence is needed to induce the industrialists to be prepared

    1109
    to borrow money to embark upon expenditure. Confidence alone, and the activity which it brings about, will lead to that rise in general prices which is the essential pre-requisite to a restoration of prosperity. One thing for which I should have thought a National Government existed, and one respect alone in which it might be preferable to a party Government, was the broad basis of confidence which it might secure.
    As far as industry is concerned the Government have not succeeded in giving that confidence. As far as Protection is concerned, the principle may have been conceded, but the application has been accompanied by an irresolution, an instability of purpose, and a framing of measures to meet the internal position of the Cabinet and not the needs of industry, which have created a most profound depression, a feeling almost of despair, among large sections of our industries. The reason is, and we have to face the fact, that the Government have not yet succeeded, after 18 months, in arriving at a definite policy on these matters. We have departmental policies affected by the point of view and the inclination of one Minister or another, and it is clear from the example we have had of the activities of the President of the Board of Trade that his point of view differs fundamentally from that of many of his colleagues, and certainly from that of the overwhelming majority of this House. For that reason he has produced an Agreement which I think he regards with profound satisfaction but which is only regarded by this House as a regrettable failure.
    8.37 p.m.
    Mr. HARBORD: I feel it my duty to express my keen disappointment that in this Trade Agreement with Germany nothing has been done to provide assistance to the herring industry. The responsible Minister knows only too well the serious plight of this important industry, and how very urgent is the need for immediate Government assistance in providing greater opportunities for trade with Germany. They have failed to achieve this in this new Trade Agreement. It is within the knowledge of hon. Members that during the past year the German Government have imposed discriminatory duties on the
    1110
    importation of cured herring into that country, but the injurious effect of these discriminatory duties will be felt much more in the coming summer and autumn because the German Government have increased them three-fold. They have gone up from three marks to between nine and 10 marks; in English money, from 4s. per barrel to 12s. per barrel. This has had a penalising effect upon an industry which has suffered equally as much as the mining industry. I rejoice that the mining industry is to benefit under this Trade Agreement, but I think that other industries are entitled to equal consideration.
    Take the case of the fishermen. It is well known to all who are intimately acquainted with the industry that the plight of the men engaged in it is parlous indeed. These men risk their lives in the North Sea in the inclement weather which we get very often on the East Coast, and after suffering all these discomforts, and after fishing not only one season but a succession of fishing seasons, the result of theii4 labour is that at the end they are heavily in debt. These men are to be pitied. This was an opportunity afforded to the Government to help them. We have forged a weapon and put it into the hands of the Government. They could have taken strong action, but they have been afraid to use the very weapon which this House put into their hands. They are afraid of the weapon which has been forged for their use, and up to the present have shown nothing which encourages us to think that they will make the fullest use of the opportunities which have been afforded them.
    Mr. DEPUTY-SPEAKER (Captain Bourne)I must point out to the hon. Member that the Resolution which is now being considered by the House imposes certain duties, or rather reduces certain duties which, with a certain agreement contained in the White Paper, may be taken into consideration. I think the hon. Member is now referring to matters not included in the White Paper. He cannot go into details not covered by the agreement.
    Mr. HARBORD: I am sorry that I am precluded from putting forward these matters. Can you tell me, Mr. Deputy-Speaker, when I shall have an opportunity of ventilating grievances which so

    1111
    gravely affect and imperil a great industry? It seems to me to be very little use coming to this House to ventilate the condition of my constituents.
    Mr. DEPUTY-SPEAKER: I am not a, prophet and I cannot tell what opportunity will arise for the hon. Member, but I have no doubt that there will be an opportunity on some future occasion.
    8.41 p.m.
    Mr. CAPE: I want to refer to same of the things which the right hon. Member for Sparkbrook (Mr. Amery) said in his speech. He commenced in a very good style. He told us that he sympathised with the coal trade and that he was glad they were going to get something from the agreement. He also said that he wanted the House to discuss this matter, not from the personal point of view or from the point of view of our constituents, but from the national aspect alone. The right hon. Member knows that in any country where you have a tariff policy you can never discuss anything from a national point of view. I remember speaking on the Import Duties Act, and I pointed out that when it was in operation every hon Member would become not a representative of the nation but a representative of some particular interest in his own constituency, or of some particular industry in which he was personally interested—
    Brigadier-General Sir HENRY CROFT: Does not that apply to the miners' representatives?
    Mr. CAPE: The hon. and gallant Member is too impetuous. The right hon. Member for Sparkbrook went on to say that he took exactly the view I have just expressed to the House. While he admitted the desirability of the coal trade getting certain benefits, he pointed out that the agreement was affecting three particular industries in his own constituency. He pointed out the effect on the toy industry. Well, I have nothing against the toy industry. He also pointed out the disastrous effect on the clock industry, and on the jewellery business. To my mind he was prepared to sacrifice any industry in this country so long as those three industries could benefit at the expense of the others. [HON. MEMBERS: "No."] That was the
    1112
    purport of his speech. Then the hon. Member for Great Yarmouth (Mr. Harbord) could not help himself. He had to advocate the interests of the herring industry, because he represents a constituency which is largely interested in fishing. We cannot blame him because circumstances and the policy of the Government compel every Member to take up that position—even the hon. and gallant Member for Bournemouth (Sir H. Croft), although I do not know the particular industry in which his constituency is interested. He interrupted me before I had properly started my speech to ask me about the representation of the mining industry. We have been forced into the same position as other hon. and right hon. Gentlemen.
    We are going to support this agreement because the policy now adopted by the country compels us to take that position. We are going to defend the interests of our industry as far as we can, but I want to make this quite clear—that that industry is not going to benefit to the extent that some people think, as a result of this agreement. I have tried to find out the actual exports of coal to Germany during the last 12 or 18 months. I first looked up the "Colliery Guardian" which is a very reliable journal, especially from the Mining Association's point of view. It would be wrong to say that it is the Association's journal, but, generally speaking, it states the facts from their point of view. The hon. Member for Bodmin (Mr. Isaac Foot) will forgive me if I repeat some figures which he quoted on Monday night. The "Colliery Guardian" says:
    "The German offer will still leave us with only about a quarter of our trade in 1913, for which the rectification of frontiers provides no adequate excuse. Even so recently as 1930, we were sending 410,000 tons of coal to Germany per month, and in 1931 the average was 314,000."
    The hon. Member for Bodmin added that he understood we were now to send 180,000 tons. Then I looked up other important journals and speeches and I found that the Secretary for Mines dealt with this subject in his speech on Monday night. In that speech and, generally speaking, in all his speeches, the hon. Gentleman apparently expects us to take everything he says as absolute fact. He never expresses opinions. They are always facts, and I suppose I could not

    1113
    quote from a better authority, though I am not going to say whether I think that the hon. Gentleman always states the facts or not. On Monday night he said:
    "The situation is that in October, 1931, before any tariff had been decided upon there had been restrictions in other countries than Germany. Germany then altered its control system from a conventional or theoretical figure of 420,000 tons a month at which it was fixed in 1924, and which has never been effectively operative; they altered that figure, applying only to the Customs area—not to the total exports from this country or the imports into Germany or into German ports—a lower quota, namely, 300,000 tons. Later on when we began to negotiate, the first thing we had to try to establish was what was our actual performance inside the German Customs area preceding October, 1931, when the figure of 300,000 tons was fixed as the control figure will give the Committee the figures. After the German and British experts had been working on the figures for some weeks, they came to the conclusion that, taking the eight months previous to October, 1931, when the alteration from the conventional or theoretical figure of 420,000 tons was made, our average monthly performance inside the German Customs area was 246,000 tons a month. That is a very different figure from 420,000 tons. If it be considered desirable to go further back and begin on 1st January, 1930, the experts on both sides have agreed—and the Mining Association is fully aware of it—that the average for the 20 months preceding 1st October, 1931, was 295,000 tons inside the German Customs area."—[OFFICIAL REPORT, 1st May, 1933; cols. 588–9, Vol. 277.]
    Therefore, I am going to take the figure of 295,000 tons a month as the actual reliable figure of our exports to Germany in 1931.
    The SECRETARY for MINES (Mr. Ernest Brown): Inside the Customs area.
    Mr. CAPE: I agree. Further, I take the statement made by the President of the Board of Trade that from January, 1931, to August, 1931, we were exporting an average monthly tonnage of 295,000. That being so, I want to know where is all the huge benefit that the coal trade is supposed to get from this agreement? I am not an expert in mathematical calculation, but taking the figures given by the President of the Board of Trade and the Secretary for Mines—and it would be sacrilege to doubt them—it is difficult to see what this benefit is, because under this wonderful Agreement we are still 115,000 tons per month worse off that we were prior
    1114
    to the operation of tariffs. The Minister of Mines on Monday night tried to show that the effect of tariffs had not been to reduce our quota to Germany to 100,000 tons, but I think he must admit that it was one of the strong factors which made the German Government reduce our quota from 300,000 tons to 100,000 tons per month.
    When hon. Members speak about the toy industry and the clock industry, the jewellery industry and the herring industry, and it may be the rose-tree industry, in connection with this agreement, I ask them to remember those facts. Let them remember that the coal trade has made bigger sacrifices than they are being called upon to make, and it will be admitted, I think, in every quarter of the House that the coal trade is of some small importance to the welfare of the country. In my opinion, it is the most vital industry in the country, and even undertariffs, much as some of us may dislike them, we are entitled to fair consideration in the coal industry. The President of the Board of Trade estimated, and it was only an estimate, that this new agreement, presuming we are allowed to export 180,000 tons to Germany, would give employment to 3,800 additional miners in this country.
    My hon. Friend the Member for Roth-well (Mr. Lunn), speaking on Monday night, said that that would not be very effective so far as the 300,000 miners who 'are now unemployed in this country were concerned. I disagree with the President of the Board of Trade, and I do it with a tremendous amount of fear. I do not think it will give employment to an additional 3,800 men, but I hope that I am wrong and he is right. I think it may give, as my hon. Friend said, an additional day a week to men who are at present working two or three days a week only, and that will be some little help to the miners.
    In all these industries there are dangers and risks to be run. One hon. Member has pointed out risks run by fishermen, and everyone in this House, especially men with long experience of living on the sea-coast, will realise that the fisherman's avocation is one of great danger, from the time he enters his boat until he gets back into port again. Other industries also have their dangers, and the mining

    1115
    community is not immune. Indeed, n the mining industry there are probably more risks and dangers run than in any other industry. When the various Ministers are making these bargains with foreign countries, therefore, I claim that they are not entitled to forget the mining industry.
    Therefore, while we give a sort of approval to this agreement, speaking on behalf of the miners' Members in this House generally, I assure the President of the Board of Trade that we are far from satisfied with the bargain that he has made, although it gives us a considerable amount more than we have had within recent months. We accept what we can get, and as long as we have a tariff policy in this country, and Members come here from various eonstituencies clamouring for the right to defend the interests of their constituents, we, as miners' representatives, claim the right under this tariff system to defend the interests of the industry in which our men are employed. I will conclude by saying that we shall not oppose this agreement to-night, and that we hope that the President of the Board of Trade, in any further agreements that he may make with other countries, will try to do even better for the coal industry than he has done in this one.
    9.2 p.m.
    Sir SAMUEL ROBERTS: I will not join the last speaker in depreciating the value of this agreement to the coal trade. I prefer to take the figures of the Minister of Mines and the President of the Board of Trade, and to agree, so far as the coal trade is concerned, that in the difficult circumstances of the times this agreement will be a definite benefit to that trade. If it were not a definite benefit to the trade, it would be a very much worse bargain than I think it is. But I am not in this House to represent the coal trade. I am here to represent the City of Sheffield, and when I opened my paper the other day and saw the reduction in the duty on razor blades coming into this country, I could not believe that it was true. I was absolutely appalled, because I know the whole history of this industry. I remember the time when we could buy only Gillettes. They were the only blade that was going, and gradually we got going. I think the Darwin was
    1116
    the first Sheffield blade that came in, and then after the Safeguarding of Industries came in, other factories started, until this particular industry is one of the very few bright spots in a city that has had a very dark time to go through. Now suddenly, after many chops and changes and within one year of the industry having felt that it had security for five years, it finds itself in the melting pot again.
    I, personally, hope most sincerely that this reduction of duty will not damage this particular industry. It may not, and I sincerely hope it will not, but what I feel is worse—and I was spending some hours in Sheffield only yesterday—than the effect that it may have on this trade is the effect that it has had on the minds of business men generally. I found an entirely different spirit, a lack of confidence over this particular agreement, and what the right hon. Member for Sparkbrook (Mr. Amery) said was said to me by practically every business man I met in the town: "What is the use of the Advisory Committee? What is the use of a promise for five years?" It is really a very bad case, because the Advisory Committee stated quite plainly that, in their opinion, the duty should not be altered for five years; and the ink on that paper has not been dry for a year when now the duty has been altered, and that has had a very bad effect.
    They may be able to carry on with a reduced duty; I hope they will; but what I feel is that it is having a had psychological effect on other people. The iron and steel industry, which is our great and important industry, has been asked to reorganise itself and has been promised a certain number of years by the Advisory Committee. Is this not going to damage their confidence? Are not the Government doing something which will injure their policy with regard to the reorganisation of the iron and steel industry The industry has this promise for a certain number of years, and then they find that a promise in a minor industry like razor blades is broken. Is that going to encourage people at this time, when people want a great deal of encouragement, to go on and do anything? After years of depression the feeling is not to spend the money and not to reorganise; that is the natural feeling of depression among the

    1117
    people of the North Midlands to-day. Their natural inclination is not to push on and not to run risks. This particular drop of the duty will have an extremely bad psychological effect upon those people who mix together in the big business centres. I regret it deeply. I am a loyal supporter of the Government and this is the first word I have uttered against them in this Parliament, but I feel that in this matter they have made a grave mistake which I most deeply regret.
    9.7 p.m.
    Miss WARD: Criticisms have been levelled against the trade agreement from two quarters during the Debate to-day. We have had criticisms from those who do not think that we have got sufficient for our quid pro quo, and we have had considerable criticism levelled against the agreement by those people who will not allow the house dogs of Protection and Free Trade to lie down together, though they may walk together in the Lobbies of the House. I personally should like to congratulate the President of the Board of Trade on being able to get any additional tonnage of coal into Germany at all, and I would like to direct the attention of hon. Members to the actual position of the coal trade in Germany. The production of coal in Germany in 1929 was, in round figures, 153,500,000 tons; in 1930 the production dropped to 142,500,000; in 1931 to 118,500,000; and in 1932 to 104,500,000. That is a continuous decline in production. Correspondingly, there was a reduction in the employment of German coal miners in the same years. In 1929 there were 550,000 men employed in German coal mines; in 1930, 504,000; and in 1931 400,000. For 1932 the figures are not yet available, but I can say on good authority that there is a further serious decline.
    Let us for a moment reverse the position. Suppose in this House of Commons we were asked, with a definitely declining market, a definite decline in coal production, and with an increasing number of miners unemployed, to sanction an agreement to bring into this country an increasing amount If foreign coal. I venture to say that every mining Member, irrespective of his party allegiance, would unite in an attempt to obtain the sanction of the Government to prohibit any importation of foreign coal. The most ardent supporters of the Protec-
    1118
    tionist policy would be the miners' leaders. I want to make another point in this connection. It is true that I am disappointed that we have not been able to get an even larger tonnage accepted by the German Government. In fact, I would welcome the whole of the European market for coal being supplied by the North-East coast, but when I hear various hon. Members wanting to nullify the agreement which has been reached between this country and Germany, I would like to ask them whether they have any real appreciation of, the disastrous state of the coal trade on the North-East coast? I wonder if hon. Members are aware that since 1926—and I go no further back than that—iL only one month in Northumberland the proceeds of the industry have justified the paying of wages within the terms of the agreement? In that county, I am ashamed to say, the wages of the miners are the lowest in any part of the country. Can the House wonder that I, and I hope all my colleagues who corns from that part of the world, support wholeheartedly this agreement, which will at any rate give Us some hope for the future.
    The President of the Board of Trade has said that this is only the forerunner of future agreements which we may hope to make with Germany if and when world trade improves. I would like to say a word to the Fiddlers while Rome burns. If I had been a more expert musician and a little surer of my score, I should have interrupted the chief fiddler in his speech on Monday last, when he assumed that the whole of the disastrous position of the British coal trade was due to the tariff policy which had been adopted by the Government. I would have asked the right hon. Member for Darwen (Sir H. Samuel) three specific questions. Is it not a fact that, prior to the election of the National Government, owing to the general collapse of world trade, there was a definite tendency all over the world to raise tariff barriers 3n a frantic effort to prevent the consequences of the collapse of the trade of the world? I would also like to ask the right hon. Gentleman categorically whether he thinks—not as a politician, because I am aware that politicians are obliged on some occasions to use unfair words instead of possibly fair statements—the evidence which he produced that the

    1119
    action of Germany was entirely due to the tariff policy which we had adopted, would for a moment hold water if he were to argue the ease in a court of law?
    I think that I may claim to say that it is very unlikely that the right hon. Gentleman would be able to make out his case, because I think that on the whole he had a very poor one. Is it not a fact that the British export coal trade is the greatest competitor in the home German market, and is it not obvious that, if as I have shown, the production of German coal and the employment of miners was gradually declining, and if as we know perfectly well, following on the events about which we have recently heard in Germany, there is a real dread of Communism, Germany should make every effort to keep her coal trade in her own market and exclude from her market the products of the country which is her greatest competitor? I should be very glad if on some future occasion the right hon. Gentleman would give me a straight answer to those very important questions.
    Finally, I must say just one word or two about the position of those of us who are by nature and political persuasion supporters of the Protectionist policy. I do quite definitely think that under present conditions we have to make up our minds whether we want to use Protection entirely in order to assist the home market or whether we want to use it in order to extend and obtain markets for our exports. I say frankly and honestly to my friends who have spoken against this agreement, while sympathising with them in.the difficulties of the industries in their constituencies, that they must ask themselves this question: "Are you going to take into consideration solely the position of the home market, or are you going to consider the interest of the export market?" There can only be one answer, because those of us who have talked about Protection from the political platform have always made the point quite conclusively that we recognise that this country as an exporting country, as a country which cannot feed its own people, must do everything it can to encourage its export trade. I say conclusively that there is only one answer, and that if we are reasonable and wholehearted supporters of the Protectionist policy we are obliged to admit that we
    1120
    must use this tariff policy with the greatest discretion and with the greatest reserve.
    If I may make one personal remark to the President of the Board of Trade, speaking as a Northumbrian to a Northumbrian, I would like to assure him that the policy which he has adopted in formulating the German trade agreement has the whole-hearted support of the majority of the people of Northumberland. The policy which he has advocated is the form of Protection that we understand, and I can assure him of the good will and the support of all of us who have the real interest not only of the coal trade but of the country as a whole at heart; and I say, with all the power at my command, that I have never had greater pleasure in doing anything than I shall have to-night in going into the Lobby in support of this agreement.
    9.18 p.m.
    Mr. DAGGAR: I am sure that hon. and right hon. Gentlemen opposite will not be averse to us who occupy these benches expressing the pleasure we have derived in seeing so many of them rising to speak in order to vent their spleen upon the President of the Board of Trade. I frankly admit, in reply to the interruption of the hon. and gallant Member for Bournemouth (Sir H. Croft), that, coming from a mining area, I am jealous of the interests of the mining industry. I do not represent a constituency where there are only 2,000 unemployed and which has very good air and very decent water. If we in the mining areas were not interested in that industry we should betray the trust of the people whom we claim to represent. I am grateful for the small contribution the Government have made, through this agreement, towards a partial revival of the coal industry in South Wales. I come from an area where, until recently, we have had practically every big colliery closed, and I frankly admit that we are jealous of the condition of the coal industry.
    Next, I want to refer to the speech of the Secretary for Mines delivered last Monday, in which he very kindly made a reference to a speech by me on 23rd March of last year. In that speech I stated, as I repeat now, that the reduction in the amount of British coal going to Germany was, in my opinion,

    1121
    largely, if not solely, due to the tariff policy of this Government. I know there will be disagreement about that, but I shall endeavour to prove that the facts, if reasonably and fairly examined, justify up to the hilt the contention we have put forward from these benches. The Secretary for Mines referred to the reply of the Parliamentary Secretary to the Board of Trade to my speech. In that reply it was stated that the German Government, when confronted with the decrease in the coal that left this country, said the decrease was largely due to the depression in the German coal industry and the difficulty of obtaining foreign exchange. I want to ask the Secretary for Mines whether he believes that statement.
    Mr. E. BROWN: I will answer that question at once. There is no question that up to the end of May that was the reason given by the German Government—not "partly" but "solely."
    Mr. DAGGAR: Well, I question the accuracy of that.
    Mr. BROWN: May I interrupt again? I can assure the hon. Member that what I am saying is a fact. If he will note the speech of the right hon. Member for Darwen (Sir H. Samuel) he will see that when he dealt with that point he expressed an opinion, and the opinion was based on something which could never be tested, because it was the opinion of an unknown man. I am giving, in answer to the hon. Member's question, what was the representation made continuously by the German Government up to the end of May.
    Mr. DAGGAR: What I am anxious to ascertain is, Does the hon. Gentleman believe the explanation, as given by either the German Government or a responsible authority in Germany, that the reason for the reduction in the German quota for British coal was the depression that, then existed in the coal industry in. Germany? If he does, I want him to take these figures into consideration. The average monthly production of coal in Germany in 1929 was 13,401,000 tons, and in 1930 it was 11,700,000 tons. It has never been higher than 9,726,000 tons since 1931. In February of this year it was 8,623,000 tons. If the depression was the cause of the restrictive quotas in 1929, when the average monthly pro-
    1122
    duction was 13,401,000 tons, what is the cause of an increase in quotas under this agreement when the monthly average production in February this year was only 8,623,000 tons?
    Mr. E. BROWN: May I interrupt again and put this point to the hon. Member? In 1929 there was no restriction. The figure in licences issued by the German Coal Controller inside the German Customs area from 1924 straight on to the 1st February, 1931, was the conventional figure of 420,000 tons. No alteration was made until 1st October, 1931.
    Mr. DAGGAR: Again, I ask, if the reduction of German imports of British coal was not due to our tariffs, how can the Government claim to have been successful in negotiating this agreement upon the understanding that the tariffs upon German goods would be reduced? I submit to the Government that they cannot have it both ways. Then again, even with the agreement you have not secured an increase in the amount of British coal exported to Germany equal to what it was in October, 1931, before the two tariff Measures for which this Government are responsible commence to operate. Previous to the intervention of the Secretary for Mines I was endeavouring to ascertain whether it was an authoritative member of the German Government who made the statement to the Government that to the depression in the coal industry was due the reduction in the amount, of British coal sent to that country. I submit the explanation is to be found in a statement by a German spokesman for the Administration of Mines. It is quite true in the explanation he made he said that the depression in the German coal industry and the difficulty of obtaining foreign exchanges were two reasons why the quotas were reduced. He also made another statement. He said he lamented Britain's depreciated currency and new tariff policy which were not favourable for international agreement, and that for some time to come the German coal industry would have to rely on its own fighting policy. I submit that fighting policy to which he referred took the form—the only form it could take—of further restricting the quotas on British coal.
    I do not desire to min raise the effect of the agreement now under discussion—

    1123
    to re-open one pit in my district would be a considerable benefit—but neither are we entitled to exaggerate its importance. What does it mean? I realise that I am not permitted to discuss the Danish Agreement. All I want to do is to include the estimated increase as the result of that agreement with the estimated increase in the amount of coal we might sell to Germany in order to prove by statistics that we are considerably worse off now than we were in connection with the coal we sent to Germany alone in October, 1931—a month before the two tariff policies came into effect. We are told that the increase in the amount of coal we shall send to Denmark will be in the region of 1,350,000 tons a year. To Germany it will be increased from 100,000 tons a month—which is 200,000 tons a month less than in October, 1931 —to 180,000 tons. There were not many speakers from the opposite side of the House on Monday who were honest enough to point out that this is not 180,000 tons as we understand tons, but that the increase is metric tons which, in comparison with the figure I have given, is a little over 77,000 tons. What was the position with regard to our coal trade with Germany prior to the tariffs being imposed? We were selling 300,000 tons a month in October, 1931, or the equivalent of 3,600,000 tons a year.
    9.29 p.m.
    Mr. E. BROWN: I am sorry to interrupt, but the hon. Member really must not put it that way. We were not selling in October, 1931, at the rate of 300,000 tons a month, but at the rate of 246,000 metric tons a month, and if you are to take 300,000 tons you have to go back 20 months for the average of 295,000 tons.
    Mr. DAGGAR: The figures I am using are taken from a statement made by the then Parliamentary Secretary to the Board of Trade, and this statement can be verified. He said that in October, 1931, we were sending 300,000 tons a month to Germany.
    Mr. BROWN: May I intervene again? We want to get this clear. Since then, the experts, both German and British, have spent weeks making an analysis, which has never been made before, of the German coal returns, and it is a certified
    1124
    statement by the experts on both sides that it was 246,000 tons in October.
    9.30 p.m.
    Mr. LANSBURY: May we have the document from which the hon. Gentleman has quoted, because it is rather unfair to hon. Members? If one Minister makes a statement in this House regarding any official report, we are entitled to rake that as correct. If there is another statement which the Minister wishes to substitute for it, that should be laid on the Table. Any document which a Minister quotes should be so laid, and I 'ask you, Mr. Speaker, if that is not so.
    Mr. E. BROWN: The answer is that if the right hon. Gentleman, cares to put a question down at any time I will give an answer.
    Mr. LANSBURY: I am not wanting to put a question. After all, the hon. Member, as a Minister of the Crown, should do what all other Ministers are usually expected to do, and that is, that when he quotes from a document he should lay it on the Table. I have been here some time and I have heard Labour Ministers challenged on this point. To-night the hon. Gentleman has quoted from a statement to contradict figures that a Minister of Mines previously gave to the House, and I suggest that we are entitled to have that document laid on the Table. The House ought not to be misled in this way. I ask whether it is not the custom that when a Minister quotes from an official document that document should be laid on the Table.
    Mr. SPEAKER: If a Minister quotes from an official document, the House is entitled to see that document.
    Mr. LANSBURY: I very respectfully ask that the Minister will lay that document on the Table.
    Mr. E. BROWN: The right hon. Gentleman is putting words into my mouth which I never used. I said an examination had been made by experts on both sides. I quoted no document, but said these were the results arrived at.
    Mr. LANSBURY: I am within the recollection of the House. The hon. Gentleman definitely said that an inquiry had been made and that certified figures had been arrived at, and that these were

    1125
    certified figures. It is playing with words to say there is no document which contains those figures, and I repeat that I ask the Minister to carry out the obligation which rests on any Minister who quotes from a document of this kind. I protest against the Minister making a statement in this House trying to prove that other hon. Members are wrong by producing another set of figures and refusing to lay the document.
    Sir AUSTEN CHAMBERLAIN: On a point of Order. Is not the rule clear, namely, that it is that when a Minister quotes specifically a passage from a document the House is entitled to see the document from which he quotes, and to see, therefore, that the passage is not unduly dissociated from its context? I submit to you that, within the Rules of the House and the Rulings of your predecessor, there was no quotation from a document on the present occasion.
    Mr. E. BROWN: I may add to that that the figures that I quoted—I have no objection to telling the hon. Gentleman and the House—are contained in an exchange of letters between the Mines Department and the German Government, and there can be no objection to their being shown at any time.
    Mr. LANSBURY: No, being laid on the Table. I very respectfully disagree with what was said by the right hon. Gentleman the Member for West Birmingham (Sir A. Chamberlain). I listened very carefully, as I usually do to the Minister's statement, and the hon. Gentleman quoted definitely from a document. He gave us figures. We want to know the connection of those figures with the argument that has been raised, and I again ask if the document might be laid on the Table.
    Mr. E. BROWN: That is precisely why I put in the answer to the hon. Gentleman. As I said, if he puts a question down—
    Mr. LANSBURY: No.
    Mr. BROWN: I cannot produce papers at a moment's notice. I tell the hon. Gentleman that if he will put a question down, the exchange of letters can be put into the official records of the House.
    Mr. SPEAKER: In reply to the right hon. Gentleman the Member for West
    1126
    Birmingham (Sir A. Chamberlain), what I said, or what I tried to convey a few minutes ago, is exactly the point which he has raised, and which was that if an hon. Member quoted from an official document, the House is entitled to see that document. That was all that I said.
    Sir A. CHAMBERLAIN: May I say that I apologise to you, Sir, for having put my point to you, in those circumstances. I am afraid that I did not catch your words; if I had, I would not have intervened.
    Mr. LANSBURY: I will not interrupt any more. I only want to repeat my request now that the hon. Gentleman shall print the document in the OFFICIAL. REPORT, or lay it on the table, so that the whole of the Members of the House may have it.
    9.38 p.m.
    Mr. DAGGAR: I did not mean to take up so much of the time of the House. The figures that I gave were used by the Parliamentary Secretary to the Board of Trade on the 23rd March, 1932, and until those are corrected I intend to use them. The difference between the Secretary for Mines and the Parliamentary Secretary to the Board of Trade they may settle between themselves. The point that I was endeavouring to make was that the proportion of German to British coal was reduced to 100,000 tons a month, and, that has been increased by the agreement to 77,000 tons a month, which means 924,000 tons for the year. If we add the 924,000 tons of British coal that will now go to Germany to the alleged increase of coal that will go to Denmark, that gives us a total annual export to those two countries of 2,274,000 tons, which is a decrease compared with pre-tariff times by 1,326,000 tons per year to Germany. [HON. MEMBERS: "An increase"] The figure which I quoted shows a decrease of that amount. By this agreement, the quantity of coal to Germany alone is down by 2,676,000 tons per year, as compared with the amount of coal we sent to Germany prior to the Measure introduced and passed by this Government.
    We have been told flat this agreement will mean employment for an additional 3,800 miners. I notice that the statement was made by a person who does not claim to represent a mining constituency, and I am anxious to compare that very

    1127
    optimistic statement with the statement that was made by a coalowner, who, in this House on Monday, agreed with an hon. Member on these benches that, in all probability, not another miner would be provided with employment, but that it might provide regular employment for the men who are now engaged in the mining industry. Although it might be that 3,800 miners will be provided with employment, the reduction in the amount of coal, compared with the amount going to Germany, prior to the tariff policy of this Government, put on the road no less than 15,000 miners. There are enormous possibilities for the Government to increase that total of 3,800 men before they attain to the figure of 15,000. The point has been made perfectly clear this evening that even if 3,800 miners return to work, the Government will have pushed out almost an equivalent number of men in other industries. We accept the contention as to the possibilities of this agreement, but we are still convinced that the decrease in the amount of coal that has left this country, since this Government came into office, is directly traceable to the tariff policy of the Government.
    9.43 p.m.
    Lieut.-Colonel Sir MERVYN MANNINGHAM-BULLER: It is with very great reluctance that I find myself unable to support the Government in this Trade Agreement. I take this opportunity of stating some of my reasons for that, and also of bringing to the notice of the President of the Board of Trade one rather remarkable example of the damage which has been done in one industry in my constituency by the operation of this agreement. I have always been a very sincere advocate of the use of the tariff as a, bargaining weapon, ever since I first contested a Parliamentary division some 27 years ago. But I realise that the tariff is a very powerful weapon and one which requires to be used with a great deal of forethought and care.
    I want to refer briefly to the position when the first negotiations took place in preparation for this agreement. What was the position? It has been stated that Germany was not carrying out the agreement which she had undertaken, with regard to the amount of coal she would purchase from this country, and,
    1128
    secondly, that we were buying from Germany twice as much as she bought from us. That put us in a very strong position indeed, as partners to a bargain, and in a better position than Germany. That was eminently a case for using the weapon of tariffs as a bargaining factor, but the way in which I would have used that weapon was precisely opposite to the way in which it was used by the President of the Board of Trade. I do not think that that was a case in which we could have lowered our tariffs; on the contrary, I think it was the precise moment when we should have raised them. To my mind what we wanted to convey to Germany was that, if she was unwilling or unable to accept from us the amount of coal which by her agreement she was bound to accept, we on our part were unwilling and unable to continue the purchases we were making from her, and we should be bound to restrict our imports from that country.
    If we had taken that line of action, one of two things must have happened—either the pressure would have been strong enough on Germany to secure what we wanted, namely, an increased sale of coal from this country, and to secure that without doing any damage to our own industries, or, if we failed in that, at any rate, we should have helped our balance of trade by reducing our imports, and should have helped some of our industries which are now working short time. Therefore, I think we might very well have made a bargain, using the tariff as a bargaining factor, and that we might have secured what we wanted without damaging our own industries. I should like to read some extracts from a telegram and letter which I have received with regard to the effect on one industry in my constituency. The telegram states:
    "We are toy manufacturers employing about 300 hands … We are now threatened with loss of a large contract recently started in the works here and may probably have to discharge about 150 people this week-end. Why is the trade not consulted in these matters?"
    I have also had a letter confirming these statements. I will read extracts from it, and, if my right hon. Friend would like to see the letter afterwards, I shall be very glad to hand it to him. It says:
    "Since Britain went off the Gold Standard we have increased our manufacturing facilities very largely, and have

    1129
    secured a large number of contracts… and our output has increased in the last 14 years from £10,000 per annum to over £14,000 per annum, all representing things made here in this factory. In the case of the toy cinemas which are more particularly affected by the present proposed agreement, last year we secured on order for £10,000 worth, which had a ready sale. This year we have spent on improved plant for manufacture of this line alone ever £3,500, and have in progress at present £23,000 of these cinemas. The whole of this contract is for one wholesale distributor. In consequence of the tariff reduction under this proposed trade agreement amounting in the case of these cinemas to 30 per cent. as optical toys "—
    I may say that 30 per cent. is his figure, not mine; I have not been able to verify it. It is due to the removal of the Safeguarding Duty which they previously enjoyed before. The letter goes on:
    "Our customer wants to cancel the major portion of the contract and we in consequence will cancel large orders for lenses (made in Birmingham) and large orders for steel plates, tin plates and other material (made in South Wales)… To our certain knowledge if the toy trade went along its normal way this year there would be employed by ourselves and other toy manufacturers in the town of Northampton alone at least 500 people, involving a weekly turnover in wages of about £1,300 or £60,000 per annum."
    It is easy to imagine what will be the feelings of the men and women who are thrown out of that industry, which is a highly skilled industry, to join the ranks of the unemployed. They are skilled operatives, and had every reason to believe that they were assured of employment for some time to come, but without a moment's notice they are thrown out of work and are likely to lose their jobs for some time, in order to help the coal industry. We are all anxious to help the coal industry, but I would put it to the hon. Member for Wallsend (Miss Ward) that we must bear in mind that every time the production of finished articles in this country is damaged coal production is damaged as well, and, therefore, it is to the interest of the coal industry not to damage these other industries. We must also bear in mind the feelings of these people. They must feel a rankling sense of injustice, and the very strongest possible case is required to justify throwing men out of one industry in order to improve another industry. In no conceivable circumstances should it be necessary to displace
    1130
    men in one industry except for a great national purpose, and I maintain that the case brought forward by the President of the Board of Trade is not a strong enough case to justify such action.
    If my right hon. Friend had been aware of the conditions in the case I have quoted, which is only one example of the result of this agreement, I doubt whether this proposal would have appeared before us in the form in which it has. If my right hon. Friend was not aware of the results which this agreement was going to have, it strikes me that he might well have been aware of them if he had consulted the industries concerned as to the results upon them of the removal of duties which already have been of great assistance to them. As I have said, I greatly regret that I find myself unable to support my right hon. Friend on this question, and I beg him, if it is not too late, to reconsider the whole matter. This proposal has not, as far as I can see, been welcomed with any great enthusiasm by the representatives of mining constituencies. I cannot help thinking that the figure of 1,800, which was given by the President of the Board of Trade as the number of men who would be thrown out of work, is a very low estimate. I hope I am wrong. On the other hand, bearing in mind the speech of the hon. Member for Eastbourne (Mr. Slater) on Monday, one cannot help thinking that the figure he gave for the men who would be employed is also optimistic, though here again I hope I am wrong. If it is not too late, I would ask him to reconsider the matter, bearing in mind the tremendously powerful feeling that there is in regard to it, and to see if he cannot bring forward another agreement which will meet with universal approval in this House and in the country generally.
    9.53 p.m.
    Captain FRASER: In my constituency and in the adjoining district a certain amount of piano manufacturing goes on, and it seems to me that that industry must consider itself singularly unfortunate when a duty which it has come to regard as almost permanent, it having been in force since 1915, is suddenly reduced. Manufacturers and operatives in that industry understood that on the return of the present Government a tariff policy

    1131
    would be introduced, but the policy of the Government has led to a reduction of protection rather than an increase, and no one can fail to sympathise with them in their plight. Moreover, the wages paid in the competing industry in Germany are some two-thirds of those paid here in London. They have been told that one of the reasons for a tariff policy was to maintain the higher wages which we were able to afford, or at any rate which we wished to try to afford. In these circumstances no Member of Parliament representing such a division can fail to use what influence, small though it may be, is in his power, to ask that special consideration shall be given to that industry in order that its case may be met; but for my part, curious paradox though it may seem, I am going to support this agreement, and I am going in a few minutes to give my reasons for doing so.
    I have been interested for some years in the area where these pianos are manufactured, and I have observed that, although the import of pianos was restricted for a time, and then under the Labour Government the duties were taken off, and although during that time more pianos came in, the piano industry has thrived when the people in England had money with which to buy pianos, and not particularly when the tariff was on. I am a Free Trader in the sense that I would like to see all the world Free Trade. So, probably, are all of us except, perhaps, my right hon. Friend the Member for Sparkbrook (Mr. Amery). Because we could not achieve that result by requesting the rest of the world to reduce the barriers—that was a very important factor in the minds of many of us during the election—some of us said to our constituents, "We are going to support a Government which, among other things, will consider the use of tariffs, quotas and restrictions of trade, not because we believe there is anything inherently good about them at all, but because they offer an opportunity of making bargains within the Empire, which we believe have a sentimental as well as an economic advantage, and of making agreements with foreign countries, which may also be to our advantage. We want to remove, if we possibly can, some of the restrictions which are choking the trade of the world and we
    1132
    want to give Great Britain a fairer chance in relation to the rest of the world than she has had in this one-sided Free Trade business." I do not know how many of us used those arguments. I did. I believed them, and I still believe them. Consequently, when the Government come forward with the first of their proposals, aimed at securing the removal of restrictions, I view it with sympathy and I hope it is a good bargain. I do not immediately jump to the conclusion that it is a bad one and join those who wish it was, in the hope that it might make trouble for the Government. [Interruption.] If there are none such, I am delighted to know it.
    One of the criticisms of this agreement is that, while it takes off some tariffs, it does not secure the reduction of any tariffs. But is that really a substantial point? Tariffs are only one form of trade restriction. Quotas are another. If you bargain a tariff against a quota, or a tariff against a tariff, or a quota against a tariff, does it matter as long as the result of your bargaining is to get freer trade? It is probably very difficult for a private Member, without access to the statistics placed in front of a Minister, to judge whether the benefit which the coal trade will receive is offset or is not offset by the detriment to the particular industries affected. Perhaps there are private Members, who are so sure that this is a bad bargain, who have access to some of these figures. Perhaps they have greater knowledge than is generally available. But I am bound to say that I found it extraordinarily difficult to form an opinion whether this is a good or a bad bargain. What, then, am I to do? I have either to trust the Government, or trust its critics, or trust the newspapers, which is the least reliable thing to do. In that dilemma I find myself inclined to trust the Government. They are beginning at this stage a policy which I believe the great majority of Members supporting the National Government approved, although perhaps at the time when they approved it they did not foresee some of the implications of it. That is not the Government's fault. Directly this policy is begun and it begins to hurt someone, as all policies do, hon. and right hon. Gentlemen rise in their places and say, "We quite agree with bargaining. Of course, there must be

    1133
    concessions, but not in interests affected in my constituency." That is not a possible way of conducting national business. It is the job of a Member of Parliament to represent the particular industries in his division. It is his job to go to the Minister behind the Chair, or in his office, or write to him, and bring to his notice the concerns of his constituents. But surely he has a greater job, and that is to support and do what he can to further a national policy.
    I do not know whether at the end of three years my constituents will return me again or not, but I consider my duty a higher one than to concern myself with whether or not I shall be returned next time. It is to do what I can to support a policy calculated to bring about a greater purchasing power and a greater measure of wealth and happiness in the country as a whole, and we cannot secure that unless we are going to have regard to our export markets. As I said earlier, unless our people have purchasing power, the retention of the home market by British manufacturers is of no positive use to them whatsoever. In all the circumstances I am going to give my support to this agreement and I am not going to assume, on the evidence that has been put before us by the Government's critics, that it is bad. On the contrary, I believe it affords an opportunity to a fundamental and very important industry, namely, the coal-mining industry, of getting some greater part of the market which it would not otherwise have had. It is no good saying that the Germans have been breaking an agreement. It appears that, when the President of the Board of Trade some months ago said the Germans were breaking an agreement, it was, if not wholly bluff, at any rate, partly bluff. [HON. MEMBERS: "No."] It is all very well to say "No," but when it came to the point he was not prepared to take it to arbitration. An hon. Member says that that is his grievance. I do not think so. His grievance really is that he did not start an economic war about it.
    If there was some difficulty in substantiating that position, I do not see what else he could do but try to get more coal trade in some other way. What mattered was that we were losing our coal trade, and not what our rights were in the matter, and the only way, appar-
    1134
    ently, in which we could secure greater exports of coal was to go to the Germans, or meet them when they came to us, and say, "What is it you want?" Unhappily, they wanted some of the trade which some of our manufacturers were beginning to acquire in the home market. I have said that is singularly unfortunate for those particular manufacturers, but, in my judgment, it would be more unfortunate for manufacturers as a whole if the policy that we have set our hands to, of trying to secure by bargaining with our new powers freer trade throughout the world, was not continued and adhered to. I look forward to further trade agreements, I will not say of this sort, because this is a singularly unfortunate one in my view, for a different reason from that which excites the pleasure of hon. Members. It is unfortunate because it admits manufactured goods. I should like to have kept out as many manufactured goods as possible. But trade agreements which seek to reduce tariff barriers, which provide us with greater opportunities in our export markets and still preserve a substantial element of Protection, as these duties which remain undoubtedly do, seem to me to be desirable, and it is a profound pity that this first occasion, this small particular, special agreement, should be made the cause of what appears to a superficial observer to be, and what will be presented as, a split in the ranks of the National Government.
    I do not believe fundamentally that the majority of those supporting the National Government regard the fiscal controversy as anything like so important as a great many of the other high matters of State which we must carry through, see through and stick to during the next two or three years. If that is so, and intelligent electorsĤnot all electors, but intelligent electors—and thoughtful people throughout the land could be consulted, I believe they would agree that The first thing of supreme importance in this country is to maintain a National Government with a national policy, and that these other questions come second. For those reasons I am going to support these agreements.
    10.6 p.m.
    Sir H. CROFT: I am sure that everyone who has listened to the speech delivered in such admirable taste and with such great skill by the hon. and gallant

    1135
    Gentleman will desire to thank him for the great wisdom which he displayed in it. I am convinced that he was right when he said that it was so difficult for him to make up his mind on the rights and wrongs of this agreement, and that he was in such a puzzled state of mind, that it was his duty to support His Majesty's Government. I think that he is right, if he has any doubts upon this subject at all and was left in such complete and utter confusion as he seemed to be, to support the National Government.
    Captain FRASER: If the hon. and gallant Member will pardon me for interrupting him, I think he has greatly exaggerated my confusion of mind. My proposed attitude was quite clear, I think.
    Sir H. CROFT: I certainly apologise to the hon. and gallant Gentleman if I have in any way stressed what he said. I thought he said that it was so difficult in such a short time to make up his mind on this question. That is no doubt the difficulty of a good many hon. Members, most of whom will agree with me that it has been amazingly difficult to get at the facts since the time that this agreement first came out for our consideration. The hon. and gallant Gentleman probably shares the views of most of those who sit on these benches when he says that he desires to see the retention of the National Government. I desire to see the retention of the National Government, if the National Government will permit us to continue to support it by engaging in the policy which the electors of this country sent us here to fulfil.
    Everyone who has ever taken any interest in economic questions at all must have waited with considerable Anxiety for the agreements which have been promoted by the President of the Board of Trade; not because they were promoted by the President of the Board of Trade, but because everyone knows that it is impossible to bring about an agreement of this description without making certain sacrifices in one direction or the other. We were the more anxious because, when the President of the Board of Trade threw away his 50 per cent. Abnormal Imports Duties in such a hurry, we were afraid that he was throwing
    1136
    away a tremendous bargaining weapon with which he would have been able to go, not only to Germany, with a small agreement of this kind, but to all countries, and in which he would undoubtedly have had a very successful means of bargaining with them for a freer resumption of trade. But we were left with a tariff which was too low in many instances to give any form of protection to our industry, and which was too low in all cases to give any effective margin for bringing about anything like an all-round reduction of tariffs with foreign countries.
    This was necessarily a fatal result of using political compromise and allowing it to interfere with a business proposition. The whole tariff plan of His Majesty's Government, as I have understood it—and I have tried to follow it intelligently—has been that an impartial Advisory Committee should henceforth decide what scale of duties was to be imposed upon various manufacturers and upon their products coming into this country. Parliament, unwisely, as I think, decided not to give—or rather, was never asked to give—any line to that committee as to what it really desired, whether it was to impose high Protection, medium Protection, merely a revenue tariff, or anything else. Nevertheless, I think I am speaking for every single man who has taken any interest in this problem—and I think that I might almost include hon. Gentlemen opposite who differ from me fundamentally—when I say that we must all confess that the Advisory Committee has won the admiration of the people of this country in the way that it has kept itself detached from party controversy. What is more, I have heard on every hand that manufacturers, specially those who have recently been before the Advisory Committee, have been completely content with the fair way in which they have been received and with the immediate grasp of their problems which that committee has now acquired after having searched through so many industries,.and by means of which it has been able to come to some sort of conclusion on their case. I have heard these tributes from many directions, and I dare say that many hon. Gentlemen in this

    1137
    The President of the Board of Trade —I am sure not intentionally—seems by this policy to be queering the pitch of the Advisory Committee, of which I always understood he was a champion. By general consent it was to have been the deciding authority on these matters. Now we find that two or three gentlemen —very estimable gentlemen—who seem to have a kind of mesmeric bias in the direction of coal, have struck a blow at this whole conception of a tariff on merits, adjusted by an impartial tribunal. The Government walk in with an agreement like this, and it is not only this agreement which we are considering tonight but the possibility that future agreements will be heard of with considerable alarm, that makes us anxious this evening.
    After immense labour, and after the great expense to which all these industries have been put, some of them have been granted what is at the most a minimum amount of Protection. They are just holding their own. They really trusted the National Government; they really believed that at least they had had breathing-space and a definite tariff granted them. With a great majority of this House, and after due consideration, they said: "Now we can settle down; now we can go out and collect money; now we can build new plant; now we can renovate and get on with the job." We have heard only this evening from the Advisory Committee what amounted to as definite a pledge as anyone could ask, for at any rate they were secure for five years. These combined industries, believing in the good faith of the National Government, have undoubtedly spent hundreds of thousands of pounds—and I think I am not exaggerating when I say millions of pounds—in extending their plant and bringing their whole processes absolutely up to date. Yet we have found—the hon. and gallant Gentleman spoke of the short time that we had had to consider it—at the end of the Parliamentary Week, printed in the White Paper on a Saturday, a treaty affecting the livelihood of many thousands of our countrymen, on a day when Members were away in their constituencies, and they were asked to come here and forced to vote upon it on Monday night. That was a grave blunder.
    There again, I am sure that it was not intentional, but blunders like that
    1138
    ought not to be committed. We surely ought to have had the opportunity of acquainting ourselves with some of the significance of this policy before ever we had to vote on such an important issue. My hon. and gallant Friend the Member for North St. Pancras (Captain Fraser) consoles himself with the fact that even if piano workers in his constituency will be thrown out of work—he hopes they will not—the miners will be able to buy more pianos. That is a consoling fact, but I am doubtful, after what we have heard from miners' representatives here this evening, whether these advantages in the coal industry really are to give such widespread benefits to these other industries.
    Let us try to balance the scale fairly. An hon. Gentleman who spoke earlier, and who happens to be a miners' representative, was rather criticising one or two of my hon. Friends because they had mentioned industries in their constituencies. I hope that he will acquit me of being specially interested in any one of these industries. Like the hon. and gallant Gentleman who has just sat down, I look at the question from a national point of view and no other, and I shall be as sincere in that endeavour as be has been. What have been the industries, apart perhaps from the motor industry and the branches of the optical glass industry, which really have shown great encouragement under the various tariffs? Am I exaggerating when I say that they are gramophones, clocks, pianos, safety razors, toys, fancy jewellery, chemicals, including formaldehyde, which we heard about on Monday from my hon. and gallant Friend the Member for Central Glasgow (Sir W. Alexander)? In a world which is decreasing its demand for pianos at such a rapid rate owing to the music which comes from the gramophone and the wireless, the piano industry is holding its own in a most remarkable way.
    If the right hon. Gentleman consults those engaged in the manufacturing side of the piano industry of this country they will tell him that the tariff has been of supreme importance. One need not argue the point. Everybody knows that before the War you could hardly see a piano in this country which was not German, but go into workmen's houses where there is a cottage piano and you will not

    1139
    see a new piano unless it is British. That has been achieved because for 17 years we have given security to the piano trade. All those industries to which I have referred have, really to the surprise of everyone in a time of declining trade, held their own, and some of them are actually going very rapidly towards prosperity. Now, like a bolt from the blue, there comes this sudden decision, and their narrow margin of protection is taken from them. Some of them are finding that competition is still very keen, and they are only living by the slightest of margins. We now find that they are to be subjected to this reduction of tariff, not only for the advantage of Germany but for the advantage of every other country in the world under the most-favoured-nation clause.
    Benefits are to be given to Germany in return for the benefit to the coal industry. I hope that this will benefit coal. I have been in very close association with many hundreds of miners at particular times in my life, and I know that they are suffering in the North-East of England and in South Wales, where I was on Monday, when perhaps I ought to have been here listening to the speeches in this Debate. But, knowing the situation of the miners of this country, how can we adjust the balance? For what are we reducing all the tariffs on all these articles? It appears to me that it is in order that we might be able to sell to Germany somewhat less coal than we sold to her last year.
    Have we really weighed up the consequences of this policy? I am afraid that the psychological ill-effects of it are likely to be more than the material effects to the coal industry. It is very alarming what has occurred during the 18 months since this Government, so full of hope, gave confidence to the whole of the industries of this country. Let us be fair, however. Their policy, although it did not go as far as many of us desired—we think they might have done more—has been very beneficial. So far as our manufacturing industries are concerned the figures of decreasing unemployment since they came into office are really remarkable. They have given great hope to a great section of the population. Psychologically their present policy is likely to have a most serious effect on
    1140
    any man who wants to put his money into business with a view to expanding it.
    Is it not time that we got back to the idea that Britain should be governed according to British interests? We have all sorts of arguments, which we hear in this House, delivered in very good faith. We are told that we ought to consider our foreign trade. Of course, we ought to consider our foreign trade, but people forget that our home trade is immensely more valuable than our foreign trade. Our internal trade is so immensely greater that is really is ridiculous to say: "Everything must be done to increase our export trade, here and now." If our export trade was anything like as important in its employment-giving value as our home trade, there would be a great deal in that argument. I suggest that we must make sacrifices if we are making any sort of economic agreement, and that some industries must suffer in order to give advantages to greater and more important industries. I do not think that anyone here would deny that if the President of the Board of Trade could have brought home some great result, such as 4,000,000 tons of coal, or something like that, for our coal industry, which would give employment to something like 14,000 or 15,000 workers in this country, it might have been a very great inducement to go ahead with an agreement such as this. But to come forward with something less than we sold to Germany in 1932, with the possible consequences to the other industries to which I have referred, I cannot consider is a good bargain. The President of the Board of Trade tells us that tariff reductions on the part of Germany were not mentioned in these discussions and that he is going to have a far bigger affair with Germany a little later. How is he going to achieve anything in the matter of tariff reciprocity with Germany then, when he has already bartered away so much of what he has to give at the present time?
    The Swiss and American clock-makers must be chortling at this moment. They have really won a very splendid victory without coming within range of the enemy's guns. We now find that clock-makers from all over the world, because we are going to give employment to 3,800 additional miners, can send their clocks

    1141
    into this country. The clock industry of this country is perhaps one of the most splendid achievements of modern days. I do not want to exaggerate. I know that it is not an industry like the coal industry, but the expansion of that industry, based on a foundation of genius and determination to win through, has been one of the most heartening things in these dark days. The employment that the clock and watch industry gives is very large. They had not a look-in until recent years, but under tariff protection they have gone ahead. In the last two or three years they have gone in for the greatest policy of mass production. In two years they have increased their output thirty-fold. Not many industries in this country can show such a result. Let me quote just a word or two from their journal, which I was reading this week. When I read it I said that if I ever had to come down to the House of Commons and make a tariff speech again—not very likely now that we had a, settled policy of tariffs—I should really have to call attention to these facts. They said:
    "The entire consumption of 4,500,000 clocks required every year in this country could be made by British firms given suitable tariff conditions. If that could be brought about within a short space of time, three or four years, the 10,000 employed in this work would be half as much again."
    There is a potential 5,000 additional workers, but I am afraid that we can hardly hope they will be absorbed now. What is the total number of persons employed in the industries which must to a certain extent be affected by this policy? When we look at the figures can we doubt for a moment that the total number is not less than 50,000? I think it is less than 60,000. I do not suggest that you are going to annihilate all these industries by reductions in tariffs, but I do suggest that there is a real danger of losing the employemnt of 5,000 or 6,000 in these industries. 'From what I have heard there is a possibility of your losing some 10,000 potential workers. I want to make an appeal to the President of the Board of Trade. Is it not possible for him to delay a decision on this question until hon. Members have had an opportunity of acquainting themselves with the facts? I would remind the right hon. Gentleman that he has had very loyal support from those who sit
    1142
    around him. I have rarely seen such loyalty given to a Minister by those who have only recently become his friends—
    Mr. ISAAC FOOT: As long as he carried out your policy.
    Sir H. CROFT: The policy I stand for is the policy upon which the National Government was elected. I ask the President of the Board of Trade, in view of the fact that he has given the country such hope, and has won the admiration of those who sit around him, that he will reconsider this matter and bring it for ward again on a future occasion. I feel that I should be absolutely untrue to what I believe if I supported such a one-sided agreement as this. To vote for such a lop-sided proposal would give me sleepless nights for many a long day. The small strain of Irish blood in me, of a thousand years ago, revolts at the idea. This is a question which, seriously affects us all. Every one is asking: where are we going? What is the policy of His Majesty's Government? Is it going to continue? After a few months we have this extraordinary change of direction in policy.
    If the President of the Board of Trade had gone to Germany and had succeeded in reducing German tariffs all round to an equality with the reduction in our tariffs, or something like that I think everybody would say it was a thing that could not be criticised. But when he makes this great reduction in our tariffs and deprives himself of future bargaining power in order to give Germany something which Germany ought to have given to us if she had continued ender her mostfavoured-nation-agreement then, I say that is a policy which is altogether dangerous. If this even were the end of the question, we might say that it was most unfortunate, but that we could not see anything more that could be done about it. But the right hon. Gentleman has indicated that be is going to meet Germany again with a much bigger policy. He has destroyed the very fabric which he set up under his Advisory Committee. We who put our trust, as a House, in the Advisory Committee suddenly find that its whole policy is in danger. It is because of that danger, because we cannot get confidence back again in industry so long as this unsettled policy continues, that I, for one,

    1143
    shall be compelled to vote against this Resolution unless the right hon. Gentleman can tell us that he is going to give the House a further chance of considering the question, when we have all had the opportunity of weighing the pros and cons and of seeing whether the disaster to this country involved in these proposal is as great as I am afraid it may be.
    10.31 p.m.
    Sir A. CHAMBERLAIN: I should greatly have preferred to wait a little longer before speaking, and particularly not to follow my hon. and gallant Friend the Member for Bournemouth (Sir H. Croft) on this occasion. Our friends may say that we are too much animated by the same spirit, and our opponents and critics will say that we are too much tarred with the same brush, to be suitable Members of this House—where so many differences of opinion find expression—to follow each other immediately in this Debate. If I rise at this point it is because I understand that my right hon. Friend the President of the Board of Trade prefers that I should speak before him and that though we are not bound by the Eleven o'Clock Rule, we are coming to the time when the House will probably desire that the Debate should conclude. I confess that as the Debates in Committee and to-day have proceeded, I have felt the embarrassment of my position. The right hon. Gentleman the Leader of the Opposition when the business on which we are engaged was being announced, said he hoped the Government did not expect the Opposition to sit up and make a House for this discussion. It was not a moment at which I could intervene to express my view but, if it had been possible, I should have been glad to see the Opposition carry out the intention which they then indicated, of going home. I want to discuss this matter as a friend and supporter of the Government with my friends, and I do not want to discuss it on the same basis as the Opposition. I do not seek the support of men who go into the same Lobby with me for entirely opposite purposes. We do not thank them for it and if I could dissociate myself from them I would. What is the position of the Opposition? At the opening of the Debate the right hon. Gentleman the Member for Wakefield (Mr.
    1144
    Greenwood) was put up to speak for them and he said "We cannot oppose this agreement.' They at any rate have turned full circle in the course of the Debate, because they are now speaking in opposition to that which they could not oppose. They remind me of the attitude of mind attributed to Alice by, I think, the Red Queen when she said:
    "The fact is, she wants to contradict something and does not know what to contradict."
    The right hon. Gentleman opposite may possibly recall the observation made thereupon by the White Queen:
    "A nasty vicious temper, I call it."
    It is a great embarrassment. I do not like the company which thrusts itself upon me, but are my right hon. Friends more comfortable? They had, flocking into the Lobby in their support, the gentlemen who sit on the benches immediately below me, not because they approved the policy of the Government, but because they found in the agreement which is now under discussion, as they thought, an admirable illustration of the futility of tariff bargaining. The position was made perfectly clear by the hon. Member for Bodmin (Mr. I Foot), immediately below me. His whole speech was devoted to showing that the character of this agreement proved the futility of any tariff bargain. Does not that give occasion for reflection to my right hon. Friends on the Treasury Bench, and even to my right hon. Friend the President of the Board of Trade 7 It is partly for that, largely for that reason that I felt bound to offer opposition to this agreement.
    Let me say at once that I am confining myself to criticism of this agreement, and, as I said to-day at Question Time, it is not my present purpose to criticise or oppose the other agreements. I am confining myself to the merits of this agreement, and I say that if this is the best you can do with tariff bargaining, then the gentlemen below me are right. But then I do not think it is the best you can do, and though I am 10th to say anything displeasing to my right hon. Friend the President of the Board of Trade, I must say that on this occasion I think his bargaining powers, which are great, and his abilities, which I learned to respect many years ago when I first sat with him, in the early War years, in Mr. Asquith 's Cabinet, were not

    1145
    employed to the best advantage, and that he could have made a better bargain.
    Is he quite happy, apart from the Gentlemen below, who support him because they think he has failed, and that his failure is a demonstration of their point of view—is he quite happy in the support that he is having from Members of our own party? There is my hon. and gallant Friend the Member for North St. Pancras (Captain Fraser). He says, "It is quite true that the President of the Board of Trade said that the German quota system was a breach of the treaty, and that they were not entitled to limit our coal exports to that country in the way they were doing." That is my complaint, that my right hon. Friend has been induced to pay twice over for what was already ours; and we find my hon. and gallant Friend the Member for North St. Pancras saying that it now appears that when he made that statement in this House, and added that the Government could not allow that to continue, he was bluffing. [An HON. MEMBER: "No!"] Yes. It is for my hon. and gallant Friend to correct me. I will accept his correction, but I do not take a correction of my understanding and hearing of what the hon. and gallant Member said from other Gentlemen who were or were not present. The defender of the Government says, "Yes, you must not attach too much importance to that, because that was only bluff "; and, as a matter of fact, when the German Government called his bluff, the right hon. Gentleman was not prepared to take the matter to arbitration.
    Just consider—this is the opening agreement of a great series of tariff negotiations. I, at least, desire those tariff negotiations to be carried out on a large scale and to be carried out successfully. But does it promise well for the negotiations if your supporters in this House think that your real justification is that in any words you have said beforehand you were only bluffing, and if the same idea is conveyed to all the other Governments with which you have to negotiate, and to the German Government, with which you have only just begun to negotiate on a corner of this question, and with whom you will find yourselves in a sharp conflict of opinion on many other subjects in international negotiations? Does it promise well if they feel encouraged by
    1146
    their first testing of your weapon and your wrist to raise their terms as you yield, to treat as bluff every positive statement that you make, and thus to refuse to you agreements that they would have been glad to make if only you had not given them the impression that you were not prepared to insist upon your right, that you were prepared to pay twice over for the same thing, and that, when you made a positive statement on the Floor of the House of Commons that you would not allow a thing, you only meant that you disliked it but would be prepared to pay to have it altered?
    I am sorry. I am sorry above all that my right hon. Friend, towards the close of his speech gave a personal touch to this question. There is no question, as far as I am concerned, of want of confidence in him. If there were a question of want of confidence, it would not be, and could not be in a question of this kind, in a particular Minister, even though he be the Minister immediately in charge. It would be a want of confidence in the Government. I never put it that way. I tried to avoid that. My right hon. Friend opened the discussion by saying that it was the business of people placed like myself to oppose, and in my first speech on this subject I said:
    "I am not going to oppose; my Motion is not moved with a view to offering an immediate negative to the proposition which my right hon. Friend has laid before the Committee" —[OFFICIAL REPORT, 1st May, 1933; col. 535, Vol. 277.]
    It was to ask for time for reconsideration and consultation between the Government and their friends. I do not think it is quite fair of my right hon. Friend to retort—I must say with the temper and in the tone which he sought to import—that it was a matter of personal confidence between those who are forced to differ from the policy of the Government and himself. I have one more word to say, and it is a point of some importance. My right son. Friend cannot believe that I am against tariff negotiations. He cannot suppose that I believe that in any negotiations one Government or one nation can have everything their own way. These are not my criticisms, and I beg him, when he answers my criticisms, not to do so by showing the futility of that kind of nonsense. My criticism is that the position which he

    1147
    chose for negotiations was a bad one for him. The ground was too narrow. In the second place, he admitted into the discussion, as a subject to be weighed in the balance, something which he already owned, and he allowed himself to take that in payment for the concessions which he made.
    Thirdly, my criticism is that the Government, having established a tariff advisory board, traders are referred to it in order that they should get—what? All they ask, all that their representatives in this House would claim for them? Not at all; only just that measure of protection, and no more, which is shown to be necessary for the industry and, after hearing objections, is compatible with the general interests of the nation. Having referred them to that body, and that body having made its decision, the right hon. Gentleman then, by executive action, sweeps away that decision. That is not to say that he ought not to bargain. My criticism is not that he ought not to bargain, but that the duties imposed by that body in that way ought to be the minimum most-favoured-nation treatment to which any nation is admitted. The basis of the negotiations should have been not "What will you give us to lower these minimum duties? "but" It is our policy to give these minimum duties only to those who make comparable arrangements for our trade and we are ready to make such an arrangement with you "—an arrangement covering not merely coal but other large industries, which were not even admitted to the door of the Board of Trade on this occasion, but were excluded deliberately by the President of the Board of Trade from his own consideration. If he had made a large scale agreement of that kind I should have rejoiced, but I should have expected it to be on the basis that this was the minimum most-favoured-nation treatment, and that if they did not earn that treatment by corresponding concessions they would be subject to higher duties than others. The Government have taken a different course.
    Now may I make an appeal to the right hon. Gentleman? The Tariff Committee are still at work; applications are still coming before them. As I understand it, the only indication that was given to them when they were estab-
    1148
    lished was that which I have described—to find the minimum of protection which a particular trade needed and see that that minimum was not contrary to the general national interest. If we are going to use that tariff for bargaining purposes, then I beg that new instructions be issued to the Committee, and that they be instructed that in future they are to leave a margin, a margin which may be the subject of consideration between them and the Government, or given an indication by the Government that they should leave a margin above the minimum which the Government can use in negotiations. I say again that I must in this matter support my own convictions, and I found myself the other night, with deep regret, in a different Lobby from my friends. It was not my desire that that Debate should end in that way, and I make an appeal to the Government, as a loyal supporter and a friend, and I beg my right hon. Friend the President of the Board of Trade to accept my plea in that spirit.
    10.50 p.m.
    The PRESIDENT of the BOARD OF TRADE (Mr. Runciman): Any appeal made to the Government by my right hon. Friend the Member for West Birmingham (Sir A. Chamberlain) we should certainly listen to with respect. He speaks from a very long range of experience and he is inspired, I am sure, with feelings of comradeship and loyalty. It is with that knowledge, in my mind, therefore, that I proceed to deal with some of the points which have been raised by him in the last half hour. In the first place, it is satisfactory to learn from my right hon. Friend that he does not take the narrow view of the tariff policy of the Government which is held by some of our right hon. and hon. Friends in this House.
    As I have listened to the Debate to-day, I have heard repeated again and again sentiments which are absolutely incompatible with one of the main objects which we had in view. When the Government embarked on its present tariff policy it did so with the deliberate intention of tariff bargaining, carrying on negotiations with other great trading countries, and by means of the tariffs which appear in our lists securing a reduction in the tariffs which were to be imposed on articles leaving this country

    1149
    and going into a, foreign country. I have put in that clumsy way, but I hope in fairly understandable English, the full phraseology of two at least of the Sections of the Import Duties Act. There are some portions of that Act which, I admit, are very difficult to understand, and anyone reading Section 7 for the first time would scarcely realise what are its implications. Section 7 of that Act provides very clearly for use being made of the tariff for bargaining purposes. It even goes so far as to say that that duty is laid on the shoulders of the Board of Trade.
    Let me, at this point, intervene with a comment on what has been said by my right hon. Friend with reference to myself. He thought I spoke on Monday night with undue warmth. Of course, I do not know what other people may think of me, but I believe I am not usually regarded as an excitable individual. As I ventured to remind the Committee on Monday night, I was attacked on the ground of being a bad negotiator. I do not think I am a bad negotiator. When it was suggested that somebody else might have done a good deal better than myself, I do not know that I was guilty of ally serious offence against the proprieties, or even, if I may be allowed to say so, against the rules of modesty, when I said, "If you can get anybody better, well, get him." But that really is not the consideration I wish to urge on the House. I am not one of those who cling to office, but, like Mr. Birrell, I still hold the view that I never asked for anything, I never refused anything and I never resigned anything. The point I wish to make now is that I am not speaking for myself alone. I quite agree that I may be the culprit, but I am speaking for the Government as a whole and it is Government policy which I have advocated to the House this week.
    It was under instructions from the Government that I carried on the negotiations with regard to the German coal agreement. It is perhaps a pity that it is called a Trade Agreement at all. I know there are many people who think it is by no means a Trade Agreement but a coal agreement. I am quite prepared to accept it as such, for I think it is mainly a coal agreement. Far be it from me to suggest this is to be the model of the agreements to be made by this
    1150
    country with other countries. I would far rather you should wait until Wednesday when you will be discussing, say, the Danish Agreement, which is one form of Trade Agreement of a very much wider character than this German Agreement, which we have discussed on Monday and Thursday of this week. Or you might turn, if you will, to the Argentine Agreement, which again is of a different nature. Every one of these agreements must have a character of its own. What is the difference between this, for instance, and the Danish Agreement? The Danish Agreement is complicated with our own agricultural interests. That was the reason why we laid a special duty upon the shoulders of the Minister of Agriculture to collaborate with us in the production of a Trade Agreement which safeguards the great industry with which he is charged.
    I turn to the Argentine Agreement. The main feature of the Argentine Agreement is to be found in the new flow of credit, which really is a main consideration to be found in that agreement, again quite a different thing from anything which appears in this German Agreement, which is vitally concerned with the state of the coal industry. When I say that, do not think that I am belittling the character of the agreement. The coal problems of this country are probably one of the main groups of problems with which we are faced. I do not leave out of account the problems of Lancashire and others which are directly implicated, but I say that, for the Government of the country as a whole, the state of the coal trade is one of the main preoccupations.
    That is true not only of those who are in office and who sit in this House, but of local authorities, individual business men and organisations of all kinds, whether of an industrial or social character. There is scarcely a municipality in the coal areas which is not greatly embarrassed owing to the state of the coal trade; there is not a railway company in the country which is not suffering from the terrible drop in its mineral traffic, all bound up with the coal trade. I make no apology for having dealt with the German Agreement on the basis of the earliest possible relief being given to one section of our trade.

    1151
    I do not wish our tariff policy to be tested by the agreement that is before us, because I do not think that it is a representative arrangement. All I say is that it is the best that could have been done in the circumstances, and that its main effect will be upon the coal trade. Hon. Members should be good enough to remember that the employment of 3,800 miners anew is an entirely new feature in the industrial movement of the day. The tendency everywhere else is to shrinkage, and to a lowering of the number. If we can only raise the number by 3,800, it is at least something that goes in the right direction.
    Sir BASIL PETO: Surely the right hon. Gentleman has not forgotten the 3,800 people—[Interruption.]
    Mr. RUNCIMAN: I hope the hon. Baronet the Member for Barnstaple (Sir B. Peto) will allow me to say that I have forgotten none of the salient facts. He has repeated them to me until I cannot forget them. If I had to make a fresh examination of them again to-morrow, I know that I should arrive at exactly the same conclusion. I am giving the House the reasons why I must adhere to the policy of the Government. Let us see what is the position in Germany itself, because that really is the key to the situation. Germany is one of those countries, of which we are not one, which are not only great producers but great importers of coal. They export it and they consume coal that is bought from abroad, as well as coal which comes from their own mines. That placed Germany in a very curious position. The margin by which we captured the coal trade of Northern Germany was a narrow margin, but just sufficient to throw the demand for coal into our market, and make it more attractive than the coal which could be bought by the German in his own market. In Germany, where they produce as well as consume coal, it is not impossible for them to transfer their demand for coal from our coal merchants to their own. The tendency to do that has been growing very rapidly, and particularly in the last two years.
    Some of my friends opposite have taken the view that the reduction in the demand for British coal in Germany was entirely due to the present Government's tariff policy, but they have left out of
    1152
    account all the movements of our time which are affecting the consumption of coal—the increase in water power, the change-over to electricity, the tendency in a great many quarters to economise in the consumption of coal, the use of the internal combustion engine, the increase in the number of slow-combustion stoves—which, by their millions, have had an enormous effect upon the consumption of coal all over the world; and that has been going on in an intensified degree in Germany. It is one of the influences which have led to a great drop in the consumption of coal in Germany, and that has been far more potent than any of the political objects which hon. Gentlemen opposite appear to have detected in the policy of the German Government.
    The German Government stated, when we first called them to account on the quota, that they were solely animated in this matter by their desire to help their own coal trade, to avoid the calamities which were surrounding their own mining industry. As time went on, we found that this was hitting us harder and harder, and then there came a moment when we protested against the lowering of the quota to such a low figure as to make it a very grave and serious blow at our coal exporting trade in to Germany. I noticed that my hon. and gallant Friend the Member for North St. Pancras (Captain Fraser) made use of the word "bluff," and it was taken up with all that instinct for the right word which is possessed by my right hon. Friend the Member for West Birmingham (Sir A. Chamberlain). He does not like the word "bluff," and I agree with him; I neither like the word nor the thing. When I said that in our view a quota was actually inconsistent with our Trade Agreement of 1924, I meant it, and I still hold that view. How does it happen that, holding that view, I yet was prepared to take the action which has now been taken by the Government?
    I told the House on Monday, and perhaps I may be allowed to repeat to-day, why we did not go to the slow process of arbitration. We protested against the quota going down, and, because it did not go down in the same degree with us as it did with Holland, we declared that in our view that was discrimination. Of course, the Germans contested that. They were quite entitled to contest it,

    1153
    just as we were entitled to put it forward. At the same time, we said that, in those circumstances, there was the machinery of the Trade Agreement of 1924, and we would fall back on that. When we said that, they said that that was the moment at which they desired to raise a new and serious question. They said to us, "Under your protocol of 1924, you undertook not to impose any duties which are specially injurious to German industry, and we claim that you have done so. We have not said so before because it has not affected our coal industry, but we now say that, if you are going to arbitration on the coal industry, we shall take to arbitration the putting of duties on industries which are of special interest to Germany." That was their statement; that was their view; that was their contention. Let us see where we stand. The Germans have been told by us that we do not accept their interpretation of the quota. They reply, "We do not accept your right to impose these duties on industries in which you are specially concerned. You wish to go to arbitration on the quota. We demand arbitration on these special duties."
    I can understand men of purely legal training regarding recourse to arbitration as being of minor advantage to the profession. It is not nearly of such great advantage as going to the courts. But there is one similarity between the courts and the arbitration proceedings to which we should have had to go, that they operate slowly. They take a long time to reach the point. They have a procedure of their own which is stately and dignified. It consumes a large amount of time. During the time when we should have been before the arbitration tribunal we should probably have seen a drop, week by week and month by month, to even lower levels of the British coal trade in Germany. On the best information that was obtainable in Germany and in this country I was bound to come to the conclusion that that was a very grave and serious risk. My right hon. Friend says if I was not going to arbitration I was giving up one of the rights to which we were entitled. I agree that we were. And, at the same time, by not going to arbitration the Germans were giving up a right. We must not imagine that these things are all on one side. They were giving up that right and we were giving
    1154
    up that right. We thought the best thing to be done was to discuss, and ultimately to negotiate, as a great many wise people do who do not want to fall into the hands of the lawyers, and that was exactly what we did. It is a very common proceeding with business men and is very often the most economical. I wished to see us making an entirely new start with regard to our German trade, and that was to see the amount rising once more instead of going down continually. It is with that object that we entered into these negotiations and pressed on with the agreement, which I agree is of a fairly narrow nature and which is governed by conditions which can scarcely apply to any other country in the world.
    I notice that the House has again and again come back to the industries that are disturbed by this agreement. I do not know that I can do better than point to one industry with the object of showing that it did not depend, in its inception, to any material degree upon our tariff policy, and that to say now that, if our tariff policy was modified, we are striking at the root of that industry is an exaggeration. I mean the toy industry. My hon. and gallant Friend made a very eloquent plea for his constituents who are engaged in an enterprising toy industry. How did that grow up? I am proud to think I had something to do with its inception. When the War broke out in 1914 we found that some of our warehouses in London and on the Thames and at Hull were filled with crates of German-made toys getting ready for the Christmas market. We seized those, like all other German products, and we invited people to come and look at them, and then we invited them to go and manufacture toys of the same kind for the use of our children. It was such a great success, and our people showed such aptitude for it, that in 1915 it had become a very important industry. In 1916 and 1917 it continued to grow, and in those four years it was growing, not under the stimulus of a tariff, but under the stimulus of total prohibition.
    Then came the period after the War. Restrictions were over, and trade started once more with Germany. But the toy industry remained in this country. We had learnt the tricks of the trade; we

    1155
    knew how to deck out these wonderful dolls with which to delight our families. What we had learnt from the Germans we put to very great trading advantage, and it was because of the skill with which our toy industry was conducted and the artistic and mechanical ingenuity which was imported into that industry that it held its own. Its prosperity was not due mainly to a prohibitive tariff at that time. I do not believe, I cannot be persuaded, that we have come to the end of the ingenuity of those who are engaged in the business. But I do not ask this House to expose them again to the full blast of foreign competition. I would still ask the House to grant to them a. very considerable degree of protection. We would still wish that they should not go back to the full blast—as I say—of open competition, but that they should have in the immediate future a 15 per cent. protection.
    I cannot believe that that is going to be such a terrible disaster to the industry. Nor am I surprised that the industry should protest, or that hon. Gentlemen in this House representing these industries should protest, but I ask them not to make immoderate estimates of the cost that this policy will impose upon the main industries of this country. I hope I am making to them a request sufficiently moderate to tax neither their opinions nor their sense of loyalty, but I would ask the House to take a much wider view of these problems before we vote to-night.
    Sir A. CHAMBERLAIN: I think my right hon. Friend is approaching a period at which he would not wish me to interrupt him. Before he comes to that period, would he deal with my last appeal as to giving new instructions to the Import Duties Advisory Committee?
    Mr. RUNCIMAN: I am sorry that I overlooked that point. The right hon. Gentleman asked me whether, in giving instructions to the Advisory Committee, we can tell them to add to the percentage of Protection which they think advisable, a certain percentage in addition which might be used for bargaining purposes. I think that is the request.
    Sir A. CHAMBERLAIN: Yes.
    Mr. RUNCIMAN: If that is the request, let me point out its disadvantages.
    1156
    In the first place, it would apply to every industry and every article. I cannot think that that would be a reasonable thing to do. [HON. MEMBERS: "Why not?"] If hon. Members will allow me to do so, I will tell the House. The first reason why I suggest that is that it would be giving a degree of protection to some of those various industries which the Committee itself would have advised was unnecessary for the purpose of carrying on prosperous business. Our expectations from the Import Duties Advisory Committee was that it would only suggest a degree of Protection which would be sufficient to keep those industries going in activity and prosperity. Then, is the extra percentage to be put on for all articles on the whole of our list of Protection to cover every item under the sun? I cannot imagine any more clumsy way of setting up a fighting or bargaining instrument.
    My second point is this: If we were to give instructions of that nature to our Advisory Committee, of course that must become known—it must be known—as the tariff policy of the Government. If those duties are to be put on with the object of bargaining and every nation that bargains with us knows why they are put on, do you think that they will take it seriously?
    Captain PETER MACDONALD: Did not Germany put an embargo upon British coal for exactly the same reason—for bargaining purposes?
    Mr. RUNCIMAN: I am afraid we are on different points. My hon. and gallant Friend is not on the same point. If you are to put on this extra 15 or 20 per cent. purely with the object of bargaining, that fact is bound to be known by those with whom you are bargaining, and they will do exactly the same thing and it will have exactly the same effect, and you will not get over the trouble with which we are now faced. That is the reason, whether the House likes it or not, why we cannot advise the Advisory Committee to put up their tariffs at an excessively high rate with the object of putting them down again. We do not think that would gain the end we have in view.
    I am sure the House does not need to be reminded that we in the Government are deeply concerned at the state of British industry. That really is not an

    1157
    anxiety peculiar to any one section of the House or any party. We all share it alike. Every difference of opinion tonight is as to how we can best attain that end. I hope that I am not adding a commonplace when I say that I think we can best attain that end by taking a national view of all our industries regarding the extent to which they are dependent upon one another. And here we have a direct illustration of exactly that point of view. If the coal industry is to prosper, and we regard it as a major issue in our programme, it should obviously mean that other industries; must prosper to the same and perhaps to a greater degree. What have we done in regard to the coal industry itself? We have embarked quite deliberately on two methods of helping the coal trade. One is, and it is.a very important one, to foster the home consumption of coal. We do not import any coal into this country; it is unnecessary. We want to foster the home consumption of coal. That is one of the reasons for our iron and steel policy. The House knows that for a couple of years I was strongly opposed to any premature action being taken with regard to iron and steel, and when I thought that action was necessary I very strongly supported a scheme by which to increase the output and demand in respect of steel in this country. That was believed to be one of the best ways of helping the coal trade. The second way to do it is by fostering the export trade.
    Mr. HOWARD: Not at the expense of British manufacturers.
    Mr. RUNCIMAN: Just in the same way as in the coal trade, we wish to foster a demand from the iron and steel consumers, for that we believe to be the best way of making a substantial addition to the coal trade, in addition to the export business. Just in so far as we do that, we also have in view the necessity of helping this industry in order to create individual consumers—household consumers—for innumerable other industries in this country. If this country is poor, it is no use expecting that poor people will purchase pianos, gramophones, clocks and toys. The poorer they are, the less they will buy of these things. The richer they are, the more likely is that demand to be. It has been argued that we have not left sufficient protection to the industries that I have enumerated to enable them to prosper. The best prosperity of all will come by increased activity in this major industry which touches some of the most hardly-pressed industries of the country, with which we have been primarily concerned, and which we hope to help.
    Question put, "That this House doth agree with the Committee in the said Resolution."
    The House divided: Ayes, 304; Noes, 56.

    Division No. 158.]

    AYES.

    [11.20 p.m.

    Adams, Samuel Vyvyan T. (Leeds, W.)

    Brocklebank, C. E. R.

    Conant, R. J. E.

    Agnew, Lleut.-Com. P. G.

    Brown, C. W. E. (Notts., Mansfield)

    Cook, Thomas A.

    Albery, Irving James

    Brown, Ernest (Lelth)

    Cooke, Douglas

    Allen, Lt.-Col. J. Sandeman (B'k'nhd.)

    Browne, Captain A. C.

    Copeland, Ida

    Anstruther-Gray, W. J.

    Buchan, John

    Cripps, Sir Stafford

    Apsley, Lord

    Buchan-Hepburn, P. G. T.

    Crookshank, Capt. H. C. (Gainsb'ro)

    Aske, Sir Robert William

    Bullock, Captain Malcolm

    Croom-Johnson, R. P.

    Astbury, Lleut.-Com. Frederick Wolfe

    Burghley, Lord

    Cruddas, Lleut.-Colonel Bernard

    Astor, MaJ. Hn. John J. (Kent, Dover

    Burgln, Dr. Edward Leslie

    Daggar, George

    Atkinson, Cyril

    Burnett, John George

    Davidson, Rt. Hon. J. C. C.

    Attlee, Clement Richard

    Butler, Richard Austen

    Davies, Edward C. (Montgomery)

    Baillie, Sir Adrian W. M.

    Butt, Sir Alfred

    Davies, David L. (Pontypridd)

    Baldwin, Rt. Hon. Stanley

    Campbell, Edward Taswell (Bromley)

    Davies, Maj. Geo. F. (Somerset, Yeovil)

    Balfour, Capt. Harold (I. of Thanet)

    Campbell, Vice-Admiral G. (Burnley)

    Davies, Rhys John (Westhoughton)

    Banfield, John William

    Cape, Thomas

    Dickle, John P.

    Banks, Sir Reginald Mitchell

    Caporn, Arthur Cecil

    Dobbie, William

    Barclay-Harvey, C. M.

    Cassels, James Dale

    Duckworth, George A. V.

    Barton, Capt. Basil Kelsey

    Castle Stewart, Earl

    Dugdale, Captain Thomas Lionel

    Sateman, A. L.

    Cautley, Sir Henry S.

    Duggan, Hubert John

    Batey, Joseph

    Cazalet, Thelma (Islington, E.)

    Duncan, James A. L. (Kensington, N.)

    Beaumont, Hon. R.E.B. (Portsm'th.C.)

    Cecil, Rt. Hon. Lord Hugh

    Eastwood, John Francis

    Bernays, Robert

    Chamberlain, Rt. Hon. N. (Edgbaston)

    Edwards, Charles

    Betterton, Rt. Hon. Sir Henry B.

    Clarry, Reginald George

    Elliot, Major Rt. Hon. Walter E.

    Birchall, Major Sir John Dea an

    Clayton Dr. George C.

    Ellis, Sir R. Geoffrey

    Bird, Ernest Roy (Yorks., Skipton)

    Cochrane, Commander Hon. A. D.

    Elliston, Captain George Sampson

    Borodaie, Viscount

    Cocks, Frederick Seymour

    Elmley, Viscount

    Bowyer, Capt. Sir George E. W.

    Collins, Rt. Hon. Sir Godfrey

    Emrys-Evans, P. V.

    Brass, Captain Sir William

    Colman, N. C. D.

    Entwlstle, Cyril Fullard

    Briscoe, Capt. Richard George

    Colville, Lieut.-Colonel J.

    Ersklne, Lord (Weston-super-Mare)

    Erskine-Bolst, capt. C. C. (Blk'pool)

    Law, Sir Alfred

    Rea, Walter Russell

    Essenhlgh, Reginald Clare

    Law, Richard K. (Hull, S.W.)

    Reld, William Allan (Derby)

    Fleming, Edward Lascellee

    Lawson, John James

    Renwick, Major Gustav A.

    Foot, Dingle (Dundee)

    Leckle, J. A.

    Robinson, John Roland

    Foot, Isaac (Cornwall, Bodmin)

    Leighton, Major B. E. P.

    Ropner, Colonel L.

    Ford, Sir Patrick J.

    Lewis, Oswald

    Ross, Ronald D.

    Fox, Sir Glfford

    Lindsay, Noel Ker

    Ross Taylor, Walter (Woodbridge)

    Fraser, Captain Ian

    Lister, Rt. Hon. Sir Philip Cunlifle-

    Runclman, Rt. Hon. Walter

    Fremantle, Sir Francls

    Little, Graham-, Sir Ernest

    Runge, Norah Cecil

    Fuller, Captain A. G.

    Lloyd, Geoffrey

    Russell, Alexander West (Tynemouth)

    Galbralth, Jamet Francls Wallace

    Locker-Lampson, Rt. Hn. G. (Wd.G'n)

    Russell, Richard John (Eddlibury)

    Ganzonl, Sir John

    Lockwood, John C. (Hackney, C.)

    Rutherford, John (Edmonton)

    Glossop, C. W. H.

    Loder, Captain J. de Vers

    Rutherford, Sir John Hugo (Llverp'l)

    Gluckstein, Louis Halle

    Lovat-Fraser, James Alexander

    Salter, Dr. Alfred

    Glyn, Major Ralph G. C.

    MacAndrew, Lt.-Col C. G. (Partlck)

    Samuel, Sir Arthur Michael (F'nham)

    Goff, Sir Park

    MacAndrew, Capt. J. O. (Ayr)

    Samuel, Rt. Hon. Sir H. (Darwen)

    Goldie, Noel B.

    McCorquodale, M. S.

    Samuel, Samuel (W'dsworth, Putney)

    Goodman, Colonel Albert W.

    MacDonald, Rt. Hon. J. R. (Seaham)

    Sassoon, Rt. Hon. Sir Philip A. G. O.

    Gower, Sir Robert

    Mac Donald, Malcolm (Bassetlaw)

    Savery, Samuel Servington

    Graham, D. M. (Lanark, Hamilton)

    McEntee, Valentine L.

    Selley, Harry R.

    Graham, Sir F. Fergus (C'mb'rl'd, N.)

    McEwen, Captain J. H. F.

    Shakespeare, Geoffrey H.

    Granville, Edgar

    McKie, John Hamilton

    Shaw, Helen B. (Lanark, Bothwell)

    Grattan-Doyle, Sir Nicholas

    McLean, Major Sir Alan

    Shaw, Captain William T. (Forfar)

    Greaves-Lord, Sir Walter

    Maltland, Adam

    Skelton, Archibald Noel

    Granfell, David Rees (Glamorgan)

    Makins, Brigadier-General Ernest

    Smith, Sir Jonah W. (Barrow-ln-F.)

    Grenfell, E. C. (City of London)

    Mallalieu, Edward Lancelot

    Smith, R. W. (Ab'rd'n & Klnc'dine, C.)

    Griffith, F. Kingsley (Middlesbro', W.)

    Margesson, Capt. Rt. Hon. H. D. R.

    Smlthers, Waldron

    Grimston, R. V.

    Martin, Thomas B.

    Soper, Richard

    Groves, Thomas E.

    Mason, Col. Glyn K. (Croydon, N.)

    Sotheron-Estcourt, Captain T. E.

    Guest, Capt. Rt. Hon. F. E.

    Mayhew, Lieut.-Colonel John

    Southby, Commander Archibald R. J.

    Guinness, Thomas L. E. B.

    Meller, Richard James

    Spencer, Captain Richard A.

    Gunston, Captain D. W.

    Merriman, Sir F. Boyd

    Spender-Clay, Rt. Hon. Herbert H.

    Guy, J. C. Morrison

    Mills, sir Frederick (Leyton, E.)

    Stanley, Lord (Lancaster, Fylde)

    Hamilton, Sir R.W.(Orkney & Zetl'nd)

    Milne, Charles

    Stanley, Hon. O. F. G. (Westmorland)

    Hanley, Dennis A.

    Mllner, Major James

    Stevenson, James

    Harbord, Arthur

    Mitchell, Sir W. Lane (Streatham)

    Stewart, J. H. (Fife, E.)

    Harris, Sir Percy

    Moore, Lt.-Col. Thomas C. R. (Ayr)

    Storey, Samuel

    Harvey, George (Lambeth, Kennlngt'n)

    Moreing, Adrian C.

    Stourton, Hon. John J.

    Harvey, Major S. E. (Devon, Totnes)

    Morgan, Robert H.

    Strauss, Edward A.

    Headlam, Lieut-Col. Cuthbert M.

    Morris, John Patrick (Salford, N.)

    Stuart, Lord C. Crichton-

    Hellgers, Captain F. F. A.

    Morris-Jones, Dr. J. H. (Denbigh)

    Sutter, Rear Admiral Murray F.

    Henderson, Sir Vivian L. (Chelmsford)

    Morrison, William Shephard

    Sugden, Sir Wilfrid Hart

    Heneage, Lieut.-Colonel Arthur P.

    Muirhead, Major A. J.

    Summersby, Charles H.

    Herbert, Capt. S. (Abbey Division)

    Munro, Patrick

    Sutcliffe, Harold

    Hicks, Ernest George

    Nall-Caln, Hon. Ronald

    Tate, Mavis Constance

    Hills, Major Rt. Hon. John Waller

    Nation, Brigadier-General J. J. H.

    Thomas, James P. L. (Hereford)

    Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.

    Newton, Sir Douglas George C.

    Thomson. Sir Frederick Charles

    Holdsworth, Herbert

    Nicholson, Godfrey (Morpeth)

    Thorp, Linton Theodore

    Hopkinson, Austin

    Normand, Wilfrid Guild

    Tinker, John Joseph

    Hore-Belisha, Leslie

    Nunn, William

    Titchfield, Major the Marquess of

    Hornby, Frank

    O'Connor, Terence James

    Vaughan-Morgan, Sir Kenyon

    Horobln, Ian M.

    O'Donovan, Dr. William James

    Wallace, Captain D. E. (Hornsey)

    Horsbrugh, Florence

    O'Neill, Rt. Hon. Sir Hugh

    Wallace, John (Dunfermline)

    Hudson, Robert Spear (Southport)

    Ormiston, Thomas

    Ward, Lt.-Col. Sir A. L. (Hull)

    Hume, sir George Hopwood

    Ormeby-Gore, Rt. Hon. William G. A.

    Ward, Irene Mary Bewick (Wallsend)

    Hunter, Dr. Joseph (Dumfrlee)

    Palmer, Francis Noel

    Wardlaw-Milne, Sir John S.

    Hunter, Capt. M. J. (Brigg)

    Parkinson, John Allen

    Warrender, Sir Victor A. G.

    Hurst, Sir Gerald B.

    Pearson, William G.

    Waterhouse, Captain Charles

    Inskip, Rt. Hon. Sir Thomas W. H.

    Peat, Charles U.

    Watt, Captain George Steven H.

    Iveagh, Countess of

    Penny, Sir George

    Wedderburn, Henry James Scrymgeour-

    James, Wing.-Com. A. W. H.

    Percy, Lord Eustace

    Wells, Sydney Richard

    Jamleson, Douglas

    Peters, Dr. Sidney John

    Whyte, Jardine Bell

    Jenkins, Sir William

    Petherick, M.

    Williams, Edward John (Ogmore)

    John, William

    Peto, Geoffrey K. (W'verh'pt'n, Bilston)

    Wills, Wilfrid D.

    Johnston, J. W. (Clackmannan)

    Pickering, Ernest H.

    Wilson, Clyde T. (West Toxtsth)

    Johnstone, Harcourt (S. Shields)

    Potter, John

    Windsor-Clive, Lieut.-Colonel George

    Jones, Lewis (Swansea, West)

    Powell, Lieut.-Col. Evelyn G. H.

    Womersley, Walter James

    Jones, Morgan (Caerphilly)

    Pownall, Sir Assheton

    Wood, Sir Murdoch McKenzie (Banff)

    Ker, J. Campbell

    Price, Gabriel

    Worthington, Dr. John V.

    Kerr, Lieut.-Col. Charles (Montrose)

    Procter, Major Henry Adam

    Kerr, Hamilton W.

    Ramsay, Capt. A.H. M. (Midlothian)

    TELLERS FOR THE AYES—

    Lamb, Sir Joseph Quinton

    Ramsay, T. B. W. (Western Isles)

    Captain Austin Hudson and Mr. Blindell.

    Lambert, Rt. Hon. George

    Ramsbotham, Herwald

    Lansbury, Rt. Hon. George

    Ramsden, Sir Eugene

    NOES.

    Amery, Rt. Hon. Leopold C. M. S.

    Bower, Lieut.-Com. Robert Tatton

    Courtauld, Major John Sewell

    Applln, Lieut.-Col. Reginald V. K.

    Boyd-Carpenter, Sir Archibald

    Craven-Ellis, William

    Atholl, Duchess of

    Bracken, Brendan

    Croft, Brigadier-General Sir H.

    Bailey, Eric Alfred George

    Broadbent, Colonel John

    Dawson, Sir Philip

    Baldwin-Webb, Colonel J.

    Buchanan, George

    Eales, John Frederick

    Balfour, George (Hampstead)

    Burton, Colonel Henry Walter

    Emmott, Charles E. G. C.

    Bevan, Stuart James (Holborn)

    Calne, G. R. Hall.

    Flelden, Edward Brocklehurst

    Bird, Sir Robert B.(Wolverh'pton W.)

    Chamberlain,Rt.Hn.Sir J.A.(Blrm.,W.)

    Greene, William P. C.

    1160

    1161

    Gritten, w. G. Howard

    Mills, Major J. D. (New Forest)

    Templeton, William P.

    Hannon, Patrick Joseph Henry

    Nall, Sir Joseph

    Todd, Capt. A. J. K. (B'wlck-on-T.)

    Hope, Capt. Hon. A. O. J. (Aston)

    Perkins, Walter R. O.

    Wayland, Sir William A.

    Howard, Tom Forrest

    Ramsay, Alexander (W. Bromwich)

    Weymouth, Viscount

    Knox, Sir Alfred

    Rawson, Sir Cooper

    Williams, Charles (Devon, Torquay)

    Latham, Sir Herbert Paul

    Ray, Sir William

    Williams, Herbert G. (Croydon, S.)

    Levy, Thomas

    Remer, John R.

    Winterton, Rt. Hon. Earl

    Macdonald, Capt. P. D. (I. of W.)

    Salt, Edward W.

    Wise, Alfred R.

    McGovern, John

    Sandeman, Sir A. N. Stewart

    Macquisten, Frederick Alexander

    Slmmonds, Oliver Edwin

    TELLERS FOR THE NOES.—

    Manningham-Buller, Lt.-Col. Sir M.

    Slater, John

    Sir Basil Peto and Sir William

    Maxton, James

    Strickland, Captain W. F.

    Alexander.

    Resolution agreed to.

WAYS AND MEANS.
Report [27th April].
Resolution reported:

AMENDMENT OF LAW.
"That it is expedient to amend the Law relating to National Debt, Customs, and Inland Revenue (including Excise), and to make further provision in connection with Finance."
Bill ordered to be brought in upon the said Resolutions and upon the Resolutions reported from the Committee of Ways and Means, and from a Committee of the Whole House on the 2nd day of May, and agreed to by the House on that day, by the Chairman of Ways and Means, Mr. Chamberlain and Mr. Hore-Belisha.

FINANCE BILL,
"to grant certain duties of Customs and Inland Revenue (including Excise). to alter other duties, and to amend the Law relating to Customs and Inland Revenue (including Excise) and the National Debt, and to make further provision in connection with finance," presented accordingly, and read the First time; to be read a Second time upon Monday next; and to be printed. [Bill 97.]

WAYS AND MEANS.
Report [3rd May].
Resolutions reported:

ROAD AND RAIL TRAFFIC (LICENCES FOR GOODS VEHICLES).
1. "That, under any Act of the present Session to make provision for (in addition to other matters) regulating the carriage of goods on roads by motor vehicles, and controlling the use of vehicles on certain roads, such fees, payable at such times, and whether in one sum or by instalments, as the Minister of Transport may prescribe, shall be charged by the licensing authority constituted by the said Act in respect of the grant or variation of licences authorising the use on roads of goods vehicles for
1162
the carriage of goods for hire or reward, or for the carriage of goods for or in connection with any trade or business."

ROAD AND RAIL TRAFFIC (PAYMENT OF FINES INTO EXCHEQUER).
2. "That all fines imposed under any Act of the present Session to make provision for (in addition to other matters) regulating the carriage of goods on roads by motor vehicles, and controlling the use of vehicles on certain reads, being fines imposed in respect of—

(i) offences under that Part of the said Act which relates to road traffic; or

(ii) offences under regulations made under that Part of the said Act

shall be paid into the Exchequer to be dealt with in the same manner as fines imposed in respect of offences under the Road Traffic Act, 1930."

ROAD AND RAIL TRAFFIC [MONEY].
Resolution reported:
"That, for the purposes of any Act of the present Session to make provision for regulating the carriage of goods on roads by motor vehicles and for controlling the use of vehicles on certain roads; to amend the provisions of the Road Traffic Act, 1930, relating to the wages, hours and other conditions of employment of persons employed in connection with certain motor vehicles; to amend the law relating to railways and to make provision for constituting a council to advise on questions in connection with the means of, and facilities for, transport; and for purposes connected with the matters aforesaid, it is expedient to authorise the payment out of moneys provided by Parliament of—

(i) such sums in every year as the Minister of Transport (hereinafter referred to as 'the Minister') may with the consent of the Treasury, direct—

(a) in respect of the remuneration, salaries, and allowances payable to the members, deputy members, clerk, and other officers and servants of the Appeal Tribunal to be constituted under the said Act, to licensing authorities to be so constituted and persons acting as officers or servants of such authorities, and to examiners and other officers and

1163
servants appointed by the Minister for the purpose of that Part of the said Act which relates to road traffic; and

(b) in respect of the establishment charges and other expenses of such Tribunal, licensing authorities, examiners and other officers, and servants as aforesaid, including any such charges in respect of superannuation and other allowances and gratuities payable on death or retirement as the Minister, with the consent of the Treasury, may from time to time determine to be proper;

(ii) any expenses incurred by the Minister for the purposes of that Part of the said Act which relates to road traffic; and

(iii) such expenses of the Transport Advisory Council to be constitued under the said Act as the Minister may, with the approval of the Treasury, determine."

TEACHERS (SUPERANNUATION) BILL.
Read a Second time.
Bill committed to a Committee of the Whole House for To-morrow.—[Mr. Ramsbotham.]
The remaining Orders were read, and postponed.
It being after Half-past Eleven of the Clock, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.
Adjourned at Twenty-five Minutes before Twelve o'Clock.