HC Deb 04 December 1934 vol 295 cc1547-56

Motion made, and Question proposed, "That this House do now adjourn."—[Captain Margesson,.]

Mr. MORGAN JONES

I was observing before the interlude that the hon. and gallant Gentleman was saying that those who are responsible for this new proposal are in a position to say that, if no business is transacted between British interests and themselves, certain foreign people are prepared to interest themselves in the proposal. Suppose that position should eventuate and that British interests do not carry through any transaction of that kind, there is nothing at all, as far as I can see, to prevent the foreign interests carrying through the transaction from their point of view. If that be so, the purpose which the right hon. Gentleman had in view in safeguarding the well-being of the "Queen Mary" merger has gone by the board. Not only has it gone by the board, but it also has the consequential effect that employment, in so far as it is given at all will not be given to English people but to foreign people. That is obviously another consequence of it. I entirely agree with the hon. and gallant Gentleman. I am not now raising the broad issue of the principle of nationalisation, as that is not here directly raised, but it is undoubtedly the fact that in connection with this matter there is considerable feeling on the American side as to the rightness or wrongness of the action which our Treasury has taken up. Judging from a letter which I received this morning, the fact which is associated in the minds of the American people is that the Royal Mail Steam Packet Company owe the International Mercantile Marine Company of New York over £2,000,000, and not one penny of interest has been paid on that money from that day to this. That non-payment has produced in those American people a feeling that, somehow or other, they are having a raw deal. I do not know whether they are right or wrong, I do not know sufficient about it, but this action which is attributed to the Treasury does tend to exacerbate feeling and to strengthen the suspicion which may be there already.

I do not think that the Chancellor of the Exchequer to-night, with every good will in the world to help us to understand this proposition, has enabled us to understand why by withholding consent, if consent be necessary, for this new proposal, he is thereby safeguarding the well-being of the merger in respect of the North Atlantic trade. Inevitably it seems to me, if this proposition is to be carried through by foreigners it is bound to interfere just as much as would have been the case if it had been carried through by English interests. I find difficulty in understanding it. So far as we are concerned on this side of the House—I have not had an opportunity of consulting my hon. Friends about it—we shall watch events with the utmost care, and I can tell the Chancellor of the Exchequer that we shall require, I have no doubt, greater light on this matter before we are fully satisfied.

11.7 p.m.

Mr. WALTER REA

It must be interesting to the considerable number of ship-owners who have been pleading for assistance from the Government to-day—they are now represented only by my hon. and gallant Friend the Member for Barkston Ash (Colonel Ropner)—to see in this an object lesson of the results which necessarily follow from Government control. The right hon. Gentleman professes that he has no particular power to act. Nevertheless, the Government, once being interested in the White Star-Cunard merger, have done something which some of us who voted for it did not anticipate would happen, at any rate, so soon. They have taken so keen an interest in the security for their money that they are preparing to establish something very nearly a monopoly arid are using their indirect powers as a Government to interfere with what surely is most legitimate competition. It seems to me that the interference is entirely futile because, as my hon. Friend the Member for Caerphilly (Mr. M. Jones) has pointed out, it cannot prevent these ships being bought by a foreign company, run from a foreign port, calling at Southampton, or whateiter may be the convenient port, and taking up passengers at that port. Therefore, the only result of the interference of the Chancellor of the Exchequer seems to he that these ships will be run under a foreign flag, employing foreign sailors, giving employment to foreigners and, if there comes a profit, giving profit to foreigners instead of bringing much needed grist to the impoverished British shipping industry.

The Chancellor of the Exchequer is not really able to impose the conditions that he seeks to apply. I cannot believe that he will be in a position to prevent such a company as the Canadian Pacific, or the Royal Mail Steam Packet Co., if they happen to be in a position to enter once more into that trade, or any English shipping company from being entitled to buy or build ships for their own trade. To build up a new trade is desirable—a trade of a totally different character from that catered for by the Cunard-White Star merger, and they would be justified in doing so. I cannot see why the Chancellor of the Exchequer should have taken this very early opportunity of indicating to my hon. Friends who have been asking for something minute in the way of a subsidy, how much they may have to suffer in the long run for the very small amount they are going to gain.

11.10 p.m.

Mr. CRAVEN-ELLIS

I want to say that I had no idea when I was supporting the merger that I was going to be a party to the creation of some form of monopoly. I am expected, as the representative of Southampton, to do all I can to encourage an increase of tonnage visiting that port, and I do feel that the Chancellor of the Exchequer has to-night taken a wrong view of the proposal. I say that for this reason. I think it is quite right that the merger should have taken place, because it dealt with a peculiar kind of passenger traffic—shall I say the super-type of passenger traffic?—which up to the time of the merger was being competed for in an uneconomic way by two of the then existing great lines. Therefore, it was a natural consequence that to preserve this super-passenger trade the Government should give their support to the merger as well as their financial assistance. But here we have a proposal for developing an entirely new trade which I cannot see is possibly going to compete with the merger company. During my short period in Southampton I have seen a very great change. I have seen a new industrial development. If Southampton so far as passenger traffic is concerned had to depend on those crossing the Atlantic, it would have a very lean time. It is because a new industry has developed in the form of cruising that Southampton holds the prominent position that she does to-day in the number of passengers using the port. This industry having been developed, a very large percentage of our people have become sea-minded. I do not think that the cruising business shows any sign of failing; on the contrary, there are so many of our people who have been taken to various places on the Mediterranean at reasonably low fares that they now want to get into wider fields. I cannot see any more advantageous avenue down which those people can travel than to cross the Atlantic and see our great Dominion of Canada and the United States of America. This fraternisation of the English-speaking people is very beneficial, not only for the development of trade but for the better understanding which we hope will secure the foundations of world peace.

This is not a matter in regard to which the Chancellor of the Exchequer can have an indefinite period in which to give his decision. I do ask him to take a broader view of this matter and try to think of it as the expansion of a new industry—the cruising industry—and give a very prompt decision. If these people who are negotiating for the purchase of this line should, through the action of the Treasury, lose that business, and it falls into the hands of some continental shipping company, we shall not save competition in the North Atlantic but shall have competition over which we shall have no control, and from a direction not as favourable as competition arising in our own country. Therefore, I do feel that the Chancellor of the Exchequer should take a broad view and give his decision very promptly in favour of British interests taking over this line which is owned by Americans.

11.15 p.m.

Colonel ROPNER

It seems to me appropriate that this important question should be discussed immediately after we have been considering the Government proposals for the assistance of tramp shipping. Hon. Members have emphasised the fact that apparently it is the intention of the Government to try to establish some sort of monopoly in the North Atlantic trade. It is time that the Chancellor of the Exchequer and the President of the Board of Trade realised that there is no possibility of British shipping obtaining a monopoly in any single trade in the world. The loan that the Government have given to the Cunard Company, just as the subsidy that is now to be given to the tramp shipping industry, is ostensibly to help British shipping. I am certain that you will not in the end assist British shipping by endeavouring to assist British competition, or domestic competition, by limiting in any way the number of British ships that are allowed to sail the high seas. What guarantee can we possibly get that this line will not in future be run by countries like France or Italy, which give much larger subsidies than we do, or might be run by a Greek line, or a line belonging to some other country, where the rates of wages are much lower than those paid to British seamen? You cannot guarantee that that will not happen; and, indeed, if that probability does happen, then the threat to the "Queen Mary" and to the whole North Atlantic traffic is infinitely worse than if this company was allowed to be bought by some British company.

It is the same problem as is raised in the tramp subsidy. Either the Government are going to assist us to enter into every possible trade in the greatest possible numbers or they are going to take what I believe is a decidedly wrong line—namely, that at the same time that they give financial help they attempt to limit the number of British ships on the sea. I understand that if the British company are allowed to buy the Red Star line it would bring in its trail the building of two new British ships. Do the Government view with equanimity the losing of these two orders to this country? Not only can foreigners run this line, and it is not possible for the Government to stop them, but equally the Government cannot stop the building of these new vessels, which it will be necessary to build, in foreign yards. I ask the Chancellor of the Exchequer to consult once again, if he has consulted at all, with the President of the Board of Trade, and I feel certain that when this matter has received further consideration by the Government they will not only allow this company to buy the Red Star line ships but will welcome action of that sort.

11.19 p.m.

Major NATHAN

One often hears the Government speaking with two voices, but seldom, I think, has there ever been a more striking example of that than this evening. It is scarcely an hour ago since the Parliamentary Secretary to the Board of Trade, speaking for the Government, said that they would in no circumstances be a party to a monopoly as regards ship breaking; that they had left open a way so that if British ship breakers did not provide adequate facilities at reasonable prices, ships could be sent abroad to be broken up by foreign shipbreakers. He gave as a reason that the Government would not tolerate a monopoly, that it must keep control in its own hands, so as to ensure that there would be a fair deal for those who wish to have their ships broken up. This evening, only an hour later, the Chancellor of the Exchequer has stated, in effect, that the Government regards the position of the White Star and Cunard fusion as being in the nature of a monopoly which should not at all events be interfered with until it has had time to shake down. Meantime, he says "Hands off" to all who may be possible competitors.

It is not to be overlooked that the Government has an interest in this matter, and I suggest that the Government ought to be scrupulously careful to avoid the least suggestion that any action of that kind, which has apparently been taken by the Chancellor of the Exchequer, should be influenced in the least by the fact that the Government itself has a financial interest in one of these enterprises but not in the other, which other it refused permission to start business here. I think the Government ought to be scrupulously careful in a matter of that kind. But I gather from the observations of the Chancellor of the Exchequer that the authority, informal perhaps, of the Treasury, was asserted against this proposed transaction, by virtue of the ban which it is in the power, in practice, of the Treasury to exert against new issues of capital.

It has always been understood that the restriction upon capital issues or expenditure abroad was based upon the assumption that some damage might be done to British currency if such issues were per- mitted, and it is frequently made, and justifiably made of course, a condition of such permission that the whole or a great part of a capital authorised to be issued should be expended in this country. But in this particular case, if any other firm possessed the necessary resources without being under the compulsion to apply to the Treasury for permission to issue capital, were to buy these ships, the Chancellor of the Exchequer would never be consulted in the matter; and even today any other firm which has sufficient resources without an issue, of fresh capital can go into the market and buy these ships without so much as "By your leave" from the Treasury.

Therefore it comes to very little more than a discrimination against a particular group of persons who desire to support this new enterprise. I speak without the least knowledge as to who they are, and therefore dispassionately, and on the principle. It seems to me a regrettable principle that the Government should lay themselves open to the suggestion that there should be discrimination between one group of persons desiring to enter upon an enterprise and another group desiring to do so. But, on the broad question of whether these ships should become part of the British Mercantile Marine under the ownership of British subjects, it must be preferable that an enterprise such as is contemplated should be started here by the use of British capital, British energy, and British sailors, with the attendant possibilities for British workmen and the compensating advantage to British taxation, rather than that the very same competition, which the Chancellor can by no means avoid, should be indulged in against British shipping by foreign owners to whom it is open to purchase these ships, which, if the general information available to all of us is true, they are about to purchase.

11.26 p.m.

Mr. MACMILLAN

This Debate is more like Alice in Wonderland than anything else in the world. Here we have passionate pleas for private enterprise and competition from the Front Opposition Bench and the horrors of the Government even being interested in industry by Members who support the complete national control of all industry, while below me we have hon. Members saying with horror how, if the Chancellor of the Exchequer had his way, the foreigner might get some benefit. I thought according to Liberals the more foreigners made the better it was for everyone.

Mr. RUSSELL REA

The hon. Gentleman misunderstands our position.

Mr. MACMILLAN

I have listened to this Debate, and to the speech of the Chancellor of the Exchequer on this important subject, which has raised great issues. I think that that speech will be found very convincing when it is read to-morrow. I can understand when we embark on these new methods we may require a new technique. It may be that the exact methods will have to be learnt by experience, but to say that when they have done something which is clearly for the benefit of trade as a whole, when they have taken a great step in backing, as the Government have rightly done, with the universal approval of this House, the finance necessary for the building of this great ship, and have given their support to the rationalisation of the Transatlantic shipping trade, to say that the Government are riot entitled to give their opinion as to what should now be done on this particular question, is pushing the principle of Liberalism, which has eaten far enough into the Tory party already, too far. I congratulate the Government upon their courage and the Chancellor on his determination to stand up for the movement which he has headed, of which this is a great example, and to continue on a reasonable middle course between the absurd extreme of nationalism on the one hand and extreme uncontrolled competition on the other, a line which, I think, will commend itself to the vast mass of moderate opinion.

11.29 p.m.

Mr. ANEURIN BEVAN

I just want to print the moral, if not adorn the tale. Hon. Members did not realise the implications of what they did when they supported the subsidy for the building of the "Queen Mary." I do not think any exception can be taken to the Chancellor's statement this evening. He is perfectly entitled to defend the money which the Government have put into the venture, and obviously those who compete in the same line of business have now a more formidable competitor in the Chancellor of the Exchequer himself. Therefore we have to suffer the cones- quences of it. The moral is that once you step into business, you have to take over the whole of it or not start at all.

It being Half-past Eleven of the Clock, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.