PETROLEUM (PRODUCTION) BILL [Lords].

HC Deb 19 June 1934 vol 291 cc213-319

Order for Second Residing read.

3.52 p.m.

Mr. MICHAEL BEAUMONT

On a point of Order. Before we proceed to the discussion, I want to ask your Ruling, Sir, whether we are, or are not, entitled to proceed with the Bill at this stage. The Standing Order lays down that in any case of a Motion made in the House which imposes a charge upon the people the consideration and Debate thereof shall not be presently entered upon, but shall be adjourned till such further day as the House shall think to appoint and then it shall be referred to a Committee of the Whole House before any Resolution or Vote of the House do pass therein. Inasmuch as Clause 1 takes away from the people of this country a contingent property which they now possess, namely, the right to petroleum under any land they may happen to possess, I suggest that it involves a charge upon the people and, as such, I cannot see why we should be in order in proceeding with it until a Financial Resolution has been passed by a Committee of the House.

Mr. SPEAKER

The hon. Member only gave me very short notice that he was going to put this point of Order to me, but I make no complaint of that as the question was in my mind, before he raised it. The only Standing Orders that might be concerned with this case are Standing Orders 63 and 68 which do not deal with the kind of transaction raised by this Bill. These Standing Orders deal with monetary charges, a charge upon the public revenue, which is the phrase used in Standing Order 63, and a charge upon the people, which is the phrase used in Standing Order 68. As regards property, petroleum is in a rather different category from other forms of property, in consequence of the Petroleum Act of 1918, which makes it necessary for any owner of land to obtain a licence before he can bore for petroleum; but, with regard to property in the ordinary sense, there are several precedents for the transference of property to the Crown without any Money Resolution preceding a Bill.

3.51 p.m.

The PRESIDENT of the BOARD of TRADE (Mr. Runcitnum)

I beg to move, "That the Bill be now read a Second time."

The object of the Government in asking the House to give a Second Reading to this Bill is to facilitate the search and boring for and the getting of petroleum. The importance of this question is not political, but is economic. This country, as far as I know at present, has such small sources of petroleum and there have been so many difficulties in the way of those companies which wished to search for petroleum, that we have to depend entirely on outside sources for our liquid fuel, with the solitary exception of the steps which were taken earlier this year and last year to obtain liquid fuel from coal. The discovery of petroleum here is of increasing importance for industrial purposes. A large and increasing number of factories and works are dependent upon petroleum for their fuel, the amount of internal combustion machinery in this country is constantly on the increase, and a very large and increasing amount of petroleum is used in its various forms for propulsion purposes afloat as well as ashore. If we were to continue, as we are at the present time, almost entirely dependent upon foreign sources for our supplies, it is clear that we should not only be hampering our own economic development here, but we should be placing ourselves in a position in regard to national defence such as we occupied from 1914 to 1918, when the liquid fuel necessary for the Fleet and other purposes was brought in tankers along routes which were dangerous. It came in convoys, which, thank God, were nearly always successful, but there is no doubt that the position was one of considerable peril.

If we can, during times of peace, do anything to develop our own reserves—I do not care whether it is coal or oil or any other natural product—it is the bounden duty of this House to grant the necessary facilities, while at the same time safeguarding all rights which exist at the present time. I doubt very much whether there is anyone here who would say that he desired to impede the search for or the getting of petroleum. It is one of the objects which Parliament has declared more than once in the past and no doubt will declare once more to-day. The question that we have had to ask ourselves in dealing with this subject is a simple one: Does the existing system seriously hamper the search for oil? The answer to that is quite certain. It does interfere with the search for oil, and if it interferes with the search for oil, we ought to do what we can to grant facilities while, as I say, safeguarding such rights as at present exist. But let us be quite clear on the first point, that we do desire to facilitate the search for oil.

The second point that I would wish to make is this, that if we desire to facilitate the search for oil, we must examine carefully the rights what at present exist. As far as we know, there are very small petroleum rights to be found anywhere in the United Kingdom. It is certain that landowners and site owners in various parts of the country have never imagined for a moment that petroleum was adding to the value of their property. If petroleum were found in any area or under any land or site, I am sure it would only be in rare instances, and they are provided for in the Schedule to the Bill, and it would come as a great surprise to the landowner. Secondly, those who at present may hope to find oil under their properties have done little or nothing in the way of exploration, and, as far as I know, there has been no land, of large area or small, which has changed hands with oil bearing any part in the consideration. No money has been paid for the transfer of any oil under a property. Parliament has, moreover, held in the past, and certainly in one Measure if not in two Measures, that property in petroleum is in a different category from property in coal, and very largely for that simple reason, that nobody imagines for a moment at the present time that there has been any transaction which was dependent on the knowledge that oil was found under any site or land.

Any boring for the ascertainment of coal, comparatively complicated as it is, is a simple matter compared with the ascertainment of the position of petroleum, if there be any. Imagine the difficulty in which an oil company would be placed which wanted to make an exploration under licence as it is entitled to under the Act of 1918. It sets to work; imagine that it finds oil. To whom does that oil belong? Does it belong simply to the freeholder on whose surface the drill first made its penetration, or does it belong to all the landowners who have oil under their properties? At the present time no one is able to say. It is quite certain that if, for instance, we took an important county like the county of Rutland, and allowed boring in Rutland, it would be necessary to deal not only with the freeholder who owned the site on which the bore hole was placed, but with all the thousands of freehold and site owners who are in the county of Rutland. Can anybody imagine for a moment that that would be an ordinary, suitable, simple, business transaction? It shows how impossible it would be for any of the considerations which have previously been provided for in Acts of Parliament, protecting coal or other minerals, to apply to the problem of petroleum.

So far as the practical working of the petroleum industry is concerned, it is absolutely essential that we should find some solution of this very complicated and increasing obstacle. We must get that out of the way, otherwise we can make no progress. The Government have considered every alternative that has been before a Royal Commission or a Committee or before Parliament in any Session in the past, and they have come to the conclusion that there is no possibility of assessing these innumerable rights, if they exist. In the first place, we hold the view that these rights, if they exist at all, are purely imaginary and have no practical value, and never have had any practical value. The only method by which these multifarious problematical rights can be brought into some sort of businesslike uniformity is by vesting the rights in the Crown. That is the only way in which you can deal with it. We have taken care in this Bill to provide for the three instances in which rights are said to exist. They are set out in the Schedule. But, as far as the procedure is concerned, it is essential that we should find something a great deal simpler than anything which is provided under the ordinary law at the present time.

After eliminating all the possibilities, we have come to the conclusion that the only way in which it is possible to simplify matters and to remove the obstacles to the operations of the oil properties which would give any chance of adding to the national wealth and national security by means of petroleum, is to vest those oil properties, if they exist at all, in the Crown. Having reached that conclusion, we ask the House to endorse it to-day. If we proceed along those lines, in the first place transferring to the Grown these various rights, what must we safeguard? We must be sure that the licences which are issued shall be issued fairly and squarely, that we do not provide for any hole-and-corner business. That aspect of the problem was mentioned in the course of discussion in another place, and was disposed of in a way that makes it clear, but I should say at once that this is not the first proposal to confer such powers on a Government Department. It is part of the normal procedure as long as we have to trust in the honesty of Government Departments, and is a perfectly proper procedure. If the House at any time decided that these public Departments were not fit to be entrusted with a duty like this, we should need to have something not short of a revolution in our Civil Service. I can imagine no authorities more likely to be trustworthy than those to be found in the principal Departments of State. We therefore turn, quite rightly, to this means alone to provide for the selection and issue of licences. It has been asked that there should be as much publicity as possible given to the issue of these licences. I would point out that, of course, it is not practicable that there should be publicity before the licences are actually granted. That would lead to all sorts of transactions which would not be fair to the prospective licensee. But immediately the licences have been granted, we are prepared to give publicity in the usual way and through the usual channels, and such advertisement as may be necessary for public purposes would be made by the Department concerned.

The next point which I would like to examine is this: Is there any new departure in the steps which are now being taken? There is only one new departure, and that is in the transfer of these royalty rights to the Crown. Otherwise there is precedent for everything suggested here. Precedent is to be found, for instance, in the steps to be taken in the early stages in the Mines (Working Facilities and Support) Act, 1923. Clause 3 of the present Bill applies that Act to the petroleum working, and also provides certain supplementary provisions. Let me point out some of these provisions. The House will, no doubt, be interested, as it ought to be, in the preservation of our amenities. It is very easy to destroy the appearance of a countryside by an industry, and we shall do everything we possibly can to mitigate what may be necessary, or to prevent what may be unnecessary. For the first time in the history of legislation of this kind, the Railway and Canal Commission is directed to have regard … to the effect on the amenities of the locality of the proposed use and occupation of the land. I would suggest to the House that that is a very proper proceeding. I can only express my regret that it has not been adopted in the earlier history of industries when many of the more beautiful parts of our country were destroyed.

I come to the second point I would make on this procedure. If anyone is subjected to disturbance, it is only right that he should be compensated. The question is to what extent he should be compensated. The view we have taken is that in making a departure of this kind we ought to err rather on the side of generosity than on the side of meanness. We have, therefore, provided that compensation shall be paid, giving an additional allowance of not less than 10 per cent. on account of the compulsory acquisition of the facilities asked for. I submit to the House that that is a very generous proposal, and it is one of which I trust the House will approve. If you take together these two proposals, first of all that the Railway and Canal Commission, when appealed to, should have regard to the effect on the amenities of the neighbourhood, and, secondly, that sufficient compensation is paid to the owners in those cases, then, I think, we may say that we have taken two valuable steps in the right direction for the preservation of our amenities. At all events, it is quite certain that our amenities are much more likely to be safeguarded by controlled than by uncontrolled development. I hope that some of my hon. Friends who are interested in this aspect of the problem will keep that well in mind.

I have no doubt that many Members of the House have seen what has happened in the United States of America, where uncontrolled development has led to the disfigurement of long stretches of territory, and at the present time, I am sure, there is not an American publicist, or indeed any American citizen, who would not envy us an Act similar to the one which, I hope, this will be when it has passed through its various stages. In America, uncontrolled development has led to the most amazing anomalies. There has been not only disfigurement of the countryside, but there has been the most awful confusion of private rights. There being no provisions such as those embodied in this Bill, a bore-hole has been sunk in an area the size of this House, and immediately alongside a rival has sunk another bore-hole, until hundreds are grouped round one centre, and in some of the best oil-bearing areas in the Southern States of America the confusion has been so great that an attempt has been made many times in the past to clear up those rights in the courts, but the attempt to do so has been, on the whole, a failure. Cases have run on in the courts 11, 12 and 13 years, and provided no solution. Recently in conversation with one of the most important younger men engaged in the oil business in America, having read the discussions in the House of Lords, he said that he had come to the conclusion that we were far wiser and far more foresighted than the people of his own country, and that he and others who are interested would give a great deal to have placed on their Statute Book the Bill which we are now presenting to Parliament. Do not let us repeat here the errors made in the United States of America.

I would like to remind the House that what we are asking Members to do today is not to take an important political step, but a most important industrial step. It is quite possible to exaggerate the importance of what we are doing now from a purely business point of view, but, at all events, I want to see the obstacles removed to allow for the necessary development of our country. This is one of the regions in which we have been least active, and if now we can induce some responsible oil concerns, who have the necessary resources and are prepared to venture large sums of capital in the exploration of oil, to embark on those explorations in these islands, I do not say that I believe oil will be discovered, but I know that we shall be taking the only step possible to ascertain what wealth there is below the surface. It is quite possible that the only oil which can be produced will come from such great depths as to make it commercially impossible, but let us see that in making that attempt we shall not allow any interests other than those of the public to be considered.

I know it is possible that there are some Members of the House who will express their surprise at this Bill being introduced by me. I am not as a rule associated with any Socialist propaganda, nor am I now. All that I am asking is that the House will grant facilities whereby private enterprise may have a chance of developing this national resource, and, in giving private enterprise that chance, I have no doubt that we shall be doing a good turn for British industry as a whole. Whatever may be the feeling which some of my hon. Friends have about this Bill, I hope that they will constantly keep in mind what the Government have before them, namely, to give us a chance of developing our own national resources to the best of our ability and for the full advantage of the public.

4.13 p.m.

Mr. GEORGE HALL

I know that no one speaking from this side of the House in dealing with a matter of this kind will have an easier task than I have this afternoon. With the exception of one or two phrases in the right hon. Gentleman's speech, I think we can say that we are in entire agreement with him. As far as the principle of the Bill is concerned, let there be no mistake about it—we are in agreement. As far as I can see from the Order Paper, the only opposition which the right hon. Gentleman is to get to the proposals in this Bill will be from some of his hon. Friends behind him. That was the experience, of course, when the Bill was in the other place. I think that the Members of the other House who represent the same view as we do on these benches were silent with one exception. Throughout the whole of the proceedings in the other place, I think there was only one speech made from a colleague of ours there, and that was in support of the Bill. As a matter of fact, if the Bill needed seconding, I should be quite prepared to add my name to that of the right hon. Gentleman.

It is not without interest that the Second Reading of the Bill is moved by the right hon. Gentleman, and that it was piloted through another place by the Secretary of State for Air. It is, indeed, a very good combination of one who is presumed to represent the Liberal side of the Coalition in the National Government, and another who represents the Conservative side. It is a Bill which, after all, whatever may be said by the right hon. Gentleman as to whether it is industrial or political, is changing the law concerning the value of a commodity in the interior of the earth in this country. We on this side of the House are pleased that the Prime Minister and his few National Labour colleagues in the Cabinet have asserted themselves and that they are to have just a small piece of Socialism in their time. We have been waiting for nearly three years for some evidence that this is a National Government. For the last three years we have had Conservative legislation, but, as one of my hon. Friends says, deep down in the earth we are getting a little to justify the existence of those Members of the Cabinet who say that they believe in Socialism. I wonder what would be the fate of this Bill if it had been introduced by myself or any of my hon. Friends from this side of the House, and if we had asked that the Bill should go a little further than is proposed. With the exception of the right hon. Gentleman's reference to the fact that the exploitation of oil is to be handed over to private enterprise, and the difficulty concerning the ascertaining of the ownership of the fuel, owing to the fact that it is in liquid form, it might well be said that every argument that he has put before the House can be applied to those minerals which are now held to be owned by the owners of the surface rights.

We agree with what the right hon. Gentleman said with regard to the importance of petroleum. We recognise the growing dependence of this and other nations upon this liquid fuel. There can be no doubt that we are living in an age of petroleum. Our Navy, a very large proportion of the Mercantile Marine, road and air transport are depending upon this fuel and, as the right hon. Gentle- man pointed out, not only is there an. increasing use of petroleum for industrial purposes, but we find that inroads are being made into the heating of a large number of places in the country as the result of the use of this new fuel. It is remarkable to remember that during the last 30 years the world output of this liquid fuel has increased something like 10 times. Last year the increase in the world's production of oil was 9 per cent. above that of 1932 and, notwithstanding the fact that we on this side of the House are pleased to think that coal is still the dominating fuel, the increase in the world's output of coal was only 2½ per cent.

We would ask the Government to do all they possibly can to encourage the production of this liquid fuel, as the result of legislation of this kind, perhaps going a little further than the right hon. Gentleman is prepared to go, searching and obtaining the oil, if it is there, and doing all that we possibly can to produce oil from coal. An industrial nation such as we are possesses so far as is known at the present time little or no oil resources within its own shores, and within the British Empire we only produce about 2 per cent. of the world's output of oil. We think that a Measure of this kind will assist, and much work might be done. Notwithstanding the gloomy prophecies of the right hon. Gentleman, it is true to say that some experts have declared their belief that oil may exist in this country, but so far no effort of a substantial kind has been made to discover it. The only effort made was as a result of State money which was voted in 1918–19. A sum of £1,000,000 of public money was voted, of which something like £570,000 was spent. As a result of the spending of that money some oil was discovered, and that suggests that there may be oil still in the earth of this country. No one suggests that the efforts that have been made have exhausted the possibilities of finding oil. I saw a report in one of the week-end newspapers which gave a very exaggerated view of the possibilities of oil production in this country, largely as a result of this Bill. The correspondent visualised huge gushes of oil in various parts of the country and said that we should have great oil production. My hon. Friend the Member for Gower (Mr. D. Grenfell) has seen and I have seen huge gushes of 250,000 gallons of oil a day in other parts of the world, but I am afraid that the optimism of that correspondent is not going to be justified.

We think that the Bill is necessary. It will protect the rights of the State and, if oil is discovered, it will decide once and for all as to the ownership of the oil. It is interesting to note that this is about the first piece of legislation introduced into this House during the history of Parliament dealing with the ownership of minerals. The question of the ownership of some minerals such as coal and minerals of that kind was decided nearly 400 years ago, and since that time little or no legislation has been introduced to interfere with that ownership. I am not suggesting that that ownership does not interfere with the rights of working the minerals. So far as the ownership of minerals is concerned, with the exception of gold and silver, I think it is true to say that the ownership is vested in the landowner who owns the surface rights. It is not without interest to speculate what would have been the economic state of this country to-day if the judgment given in 1568 which gave to the landowner the ownership of the minerals, had been different. It is indisputable that, if any broadly conceived national policy is to be pursued in the production of the mineral wealth of the country, the minerals should be owned by the State. The distribution of the minerals among a large number of owners, as the right hon. Gentleman pointed out, places innumerable obstacles in the way of efficient organisation of all industries connected with the mining of minerals.

We claim definitely that the present system of royalty ownership is a clog on the free development of mining enterprises. That is proved, for there has been no inquiry into the difficulties with which the coal industry of this country has been confronted during the last 25 years without reference being made to the difficulties which have arisen as the result of the private ownership of minerals. The Sankey Commission in their report may have been divided on many questions, four different reports were submitted, but there was no doubt about the unanimity of all the members of the Sankey Commission as to the (difficulties which have arisen because of the ownership of that important mineral, coal. The same may be said with regard to the report of the Commission presided over by the right hon. Member for Darwen (Sir H. Samuel) in 1925, when it dealt with the same matter. The Coal Mines' Reorganisation Commission in its report published late last year dealt with the same difficulty. I might quote their reference to the difficulty which has arisen as a result of this private ownership. The Commission refer to the part which the nationalisation of royalties was originally intended to play in making the changes which they were asked to bring about, and they go on to say: Even if those structural changes were successfully made, the present system of mineral ownership would stand in the way of effective and lasting reorganisation. This weakens incentive to face the difficulties of making them. 'What,' we are asked, is the use of doing all these troublesome things, eliminating waste, secure planned development and get rid of superfluous units, so long as so much still depends on the accident of mineral ownership, and our plans may always be stultified by the opening or re-opening of mines without regard to corporate efficiency or national need?' We can only answer this question by saying that Parliament will presumably remove sooner or later—whether by nationalisation or some less sweeping reform—an impediment that so seriously obstructs the fulfilment of its policy. That is the position concerning coal, and now that we have a new industry which is likely to grow up we say that the Government are taking proper and necessary steps to see that the organisation of that industry shall not be impeded as is the organisation of the coal industry at the present time. In addition to the difficulties to which I have referred, my hon. friends on this side of the House know that there is nothing that has given greater cause for discontent among the miners than the fact that a portion of their living has been filched from them and handed over to other people who have made no contribution at all to the industry. There is an instance in South Wales at the present time where the royalty charge upon a ton of coal is 1s. 4d. In addition, there are wayleaves, so that, including wayleaves and royalties, the income of the landowner is something like 1s. 6d. or 1s. 7d. per ton of coal. I will not pursue that argument further, but we have already seen in the desire to search for oil in this country that similar diffi- culties have arisen regarding the granting of leases as we have had to meet in dealing with coal. I should like to give a quotation from the "Oil News" of 29th March of this year. Referring to this Bill it says: The main defect of the 1918 Act to which the right hon. Gentleman referred— was that under it, although anyone could get a licence to drill, practically no one could make an agreement with landowners on reasonable terms for the would-be licensee. That, to our knowledge, has prevented scores of desirable parties from applying for licences. Not that they had any doubt at all that they might be successful in obtaining oil, but because difficulties arose as a result of failing to get an agreement with the owners of the land. On 31st March of this year the "Petroleum Times" said: The British Government has at last taken what appears to us a sensible step in cutting the Gordian knot which has deterred oil exploration in the past. While surface owners will be safeguarded, the ownership of the oil beneath will be vested in the Crown, and measures are to be taken to remove the almost insuperable lease and royalty difficulties which previously hampered oil research. Therefore, exactly the same difficulty has been experienced in dealing with the exploitation of oil as in dealing with the production of coal.

I can say on behalf of my hon. Friends that we welcome this Bill. It is a revolutionary departure from the common law, under which a landowner owns everything beneath his land. It is indeed remarkable that a freeholder should be held in law to possess not only the surface rights but whatever minerals may lie below, at whatever depth they may be made available. We claim that the private ownership of the interior of the earth in this country cannot be defended on any reasonable ground, and we are pleased that this Bill is introduced, for it will determine the ownership of some mineral products, however limited they are, and it should enable the nation to realise the difficulties with which it has been faced concerning other minerals. If this Bill, without compensation, took for the State the ownership of the oil discovered, I do not know that anyone could complain; but generous compensation is provided in the Bill. The right hon. Gentleman said that the Rail- way and Canal Commission will take all questions into consideration; first, the market value of the land; secondly, the question of amenities; and in addition to the market value of the land and the amenities there is to be 10 per cent. added to the owner as compensation for working oil under his land. We think that the Government have overstepped the mark in the generosity of their compensation.

The right hon. Gentleman mentioned that licences already in existence are to be continued. We would like to see the licences in existence lapse with the 1918 Act, for we must take note that some of these licences have been in operation for some time. The licence to work or search for oil in the county of Derbyshire was granted in 1923. I ask the Secretary for Mines, who is to reply, to tell us whether that licence has been used in any way, and whether the person who holds the licence has spent a single penny for the purpose of ascertaining whether oil has been discovered in the area for which the licence is taken out. The same question might apply to the other licences which have been granted, one over four years ago and the other three years ago. We would like to know something also as to the regulations. What kind of regulations have the board in mind for the granting of these licences, and on the question of payment of royalties? We were a little startled by what the right hon. Gentleman said, that, EIS far as the Government were concerned, all they were going to do was to grant licences to private enterprise for private enterprise to try this out. We wish the Government would have courage to go the whole hog and do what Sub-section (1) of Clause 1 indicates that they can do. We would have liked the Bill to have gone much further in the matter of the ownership of royalties. We regret very much that other minerals are left out. But we support the Bill and will give the right hon. Gentleman all the assistance possible to get it through, for if oil or natural gas is found in this country its ownership under this Bill will be secured. In our opinion it will enable a new industry to develop in an ordinary way without the waste caused by the interest of the landowner being first considered. This Bill puts the interest of the nation before all others, and the nation should reap the benefit.

4.35 p.m.

Mr. KINGSLEY GRIFFITH

I hope that the President of the Board of Trade will believe me when I say that it is with sincere delight that I am able to support whole-heartedly a Bill introduced by himself, assisted by his hon. Friend the Secretary for Mines. As the last speaker said, we were really committed beforehand to support of the Bill by the attitude we adopted with regard to coal. We were in favour of applying to the coal industry the principles now put forward, and if the late President of the Board of Trade had included such a provision in his Bill under the last Labour Government, it would have received our support. I agree, however, that there are reasons which make it far easier and much smoother to apply the provisions to oil than to coal. I am just wondering what would have happened if past ages had been able to obtain a vision of our industrial development. If early Kings, such as William the Conqueror, in making grants of land to their supporters had been able to foresee the future and had preserved to the Crown the mineral rights, the industrial development of this country would undoubtedly have gone very much more smoothly. Some fortunes which had no foundation in justice perhaps would not have been made, but the welfare of the country would have been vastly increased. By these proposals no injustice is done to anyone.

The House is rightly jealous of the rights of property, properly understood, but I believe that property should not be regarded and respected as an abstraction, in which case it may be a vicious principle, but that what should be regarded are the rights of legitimate expectation. When an institution has existed, however illegal its foundation, and in the course of history a mining right has been bought and sold and value given for it, it becomes very difficult indeed to deal with it without doing injustice to someone. When a man has either himself or by his ancestors paid over solid money for a right which the nation now no longer regards as proper to exist, naturally he demands some kind of compensation. It, therefore, makes the whole problem very much simpler if statesmen have the foresight and courage to deal with the matter at the beginning before these vested interests have grown up. I congratulate the Gov- ernment on taking this step now, when the vested interests that have grown up are negligible, and when the future of this kind of industrial development Can be assured.

There are, of course, and there are bound to be, opponents of a Measure of this kind. I am rather afraid that we might rather increase the difficulties of the President of the Board of Trade by the warmth of our support, because some hon. Members opposite might think that anything supported by us must have a catch in it somewhere. I can assure them that I thought rather the same when I saw the names attached to their Amendment. I hope, however, that the House will not decide this question by looking at the names of the people on the one side or the other. The President of the Board of Trade has put before us a plain and businesslike proposition which I think the House ought to accept, and those who are alarmed by seeing Socialist and Liberal support given to a Bill of this kind can at least reflect that there are more responsible sponsors for the Bill. The Bill has come to us from another place, where, I have no doubt, it was under very careful consideration by those who were alive to all the kinds of considerations which are foremost in their minds. I do regard this as proper work for a National Government to do. I think that the National Government is doing to-day what some of us were inclined to think it was refusing to do only yesterday, that is to say that it is to-day making a wise and far-sighted effort to secure national wealth for national use. For that reason I and my friends support the Bill. We hope it will be passed. Then it will only remain to discover a little petroleum.

4.40 p.m.

Marquess of HARTINGTON

I beg to move to leave out the word "now," and, at the end of the Question, to add "upon this day three months."

I would like, on behalf of the Government of which I am a supporter, to thank the hon. Member for Aberdare (Mr. G. Hall) and the hon. Member for West Middlesbrough (Mr. K. Griffith) for the support they have given to the Bill, and I have no doubt that the two Radical land-taxers who represent this Bill on the Front Bench are very pleased at their new alliance with the official Opposition. I myself am a keen supporter of the National Government, but I am not quite sure how far these alliances are helpful to its continued existence. The hon. Member for West Middlesbrough said he wondered what the effect on the development of our coal seams would have been if coal had remained in the hands of the Crown. There is very little difficulty in finding out. There is coal in the hands of the Crown to-day in the Forest of Dean. That is Crown property. It is without exception the worst laid out and the worst conducted coalfield in the country.

Mr. G. HALL

It does not pay royalties, anyhow.

Marquess of HARTINGTON

But the hon. Member is quite satisfied apparently; he does not mind how badly a coalfield is laid out and how distressing the conditions may be, so long as no loyalty is paid. I am afraid that my light hon. Friend the President of the Board of Trade, who introduced this Bill, will think that I am taking up a rather ungracious attitude in opposing it when he has taken the trouble to insert in it a special provision exempting my family and our oil well, from its operation. I rather feel that I am biting the hand which fed me. But there are questions of principle involved in this Bill, and I feel bound to oppose it, although justice has been done to me in particular.

Mr. RUNCIMAN

In inserting that provision in the Schedule, I had no consideration as to whether I disliked or liked anyone. I was only doing what I thought was common justice.

Marquess of HARTINGTON

I quite appreciate that, and I was not suggesting that this was a personal favour. But there are certain advantages in one's position. I think I am the only Member of this House who has had practical firsthand experience of drilling for oil in England. I am to-day the owner, or a member of the firm which is the owner, of the only oil-producing well. The hon. Member for Aberdare asks whether anything has been done with the licence owned by my family. The answer is "Yes." We sank a very considerable amount of capital in sinking two wells to a considerable depth. We found data which are of very considerable value, but we discontinued drilling, partly because the costs were very great and the price of oil at the time was very low, but much more because coal is being worked in that same neighbourhood. The difficulties of an underground manager are great enough already without people boring holes for oil through the strata which he is working. It is necessary to leave a pillar of coal about 2½ acres in extent around each drilling, and that makes working for oil absolutely impossible. As the coal is a certainty and the oil is not, and the coal will be worked in a comparatively few years, we decided to suspend drilling until such time as the seams are exhausted. That is the answer to the hon. Member's question. We have obtained certain results which are of value for the future.

My opposition to the Bill is based on three main grounds. The first is that it is wrong and bad in principle, in that it is a return to the old, vicious system of Royal monopolies, against which Parliament fought for 200 years before it was finally successful. Secondly, it must tend to make the ownership of land less attractive that it has been in the past, must tend to diminish the sense of security in ownership of land, and thus to diminish the flow of capital into the land, which is essential if the agricultural policy of the Government is to succeed. It will, therefore, have a definitely bad effect on the agricultural policy of the Government. The third objection is that as an oil policy it is definitely wrong, is obstructive rather than constructive, is absolutely unnecessary, and is going to have the effect—indeed, has already had the effect as I shall be able to show—much more of delaying and impeding the search for oil than of promoting it.

Since the beneficent advent of the National Government my interventions in Debate have been few and very brief, but this is a very big subject, and one about which, I say it with all diffidence, I do not know a great deal, and therefore I hope the House will bear with me in making a speech of almost intolerable tedium, because I have an enormous amount of ground to cover. First, I will deal briefly with the position of Royal monopolies. Hon. Members have talked of this new Bill as though it contained some new principle. Nothing could be further from the facts. These Royal monopolies are as old as English history. Parliament struggled against them for centuries, not because it was opposed to the Crown, but because these monopolies were found in actual practice to be an almost intolerable restraint upon legitimate trade; as I believe this monopoly will be found to be if the House is rash enough to grant it to the Government.

There was a four days' Debate in this House on the subject of Royal monopolies in 1601. As a result, Queen Elizabeth adopted an extremely conciliatory attitude. She made a very amiable address to the House, she promised to grant no more monopolies, and even to withdraw those which were already in existence. Having created a favourable atmosphere she, as might be expected, waited until the excitement died down down and then did exactly the same as before. The Royal monopolies went on until they were finally abolished in 1660. They were made illegal in 1624 and another Act was passed in 1641, and in 1660 Parliament finally believed it had disposed for ever of these Royal monopolies. The Act declared that they were finished for ever. As I say, that was not because Pariament was opposed to the Crown, or hostile to granting them to the Crown, but because these monopolies did tend to restrict trade to such an intolerable extent. I would like to quote from one speech in the Debate of 1601. Mr. Lawrence Hide said: I confess, Mr. Speaker, that I owe duty to God and loyalty to my Prince. And for the Bill itself I made it and I think I understand it: and far be it from this heart of mine to think, this tongue to speak, or this hand to write anything, either in prejudice or derogation of Her Majesty's prerogative Royal and the State … And, Mr. Speaker, as I think it is no derogation to the omnipotency of God, to say that he can do no ill, so I think it is no derogation to the person or Majesty of the Queen to say so. And this from another speech: Out of the spirit of humility, Mr. Speaker, I do speak it: there is no act of hers that hath been or is more derogatory to her own Majesty, or more odious to the subject or more dangerous to the commonwealth than the granting of these monopolies. In that day loyal Members were prepared to grant the Queen revenues, but decided that the monopoly system had led to a restriction of trade. Now we have this system advocated as a new Measure, as a progressive development, whereas all we are doing in fact is to put back the hands of the clock some 300 years.

My second point I can deal with nearly as briefly, though it is one of very great importance, having regard to the agricultural policy which the Government are pursuing. The Government have embarked, and rightly and wisely embarked, on a far-reaching scheme of agricultural reconstruction. They have adopted a policy based on the view that as a nation we cannot allow our agriculture to fall further into decay, that the rot must be arrested even at the risk of raising prices to consumers. In some directions that policy has met with a certain amount of success; in others it has not yet been fully successful. In the case of meat and milk it may yet prove that the climate and the seasons will do more to raise agricultural prices than all the appointed persons and marketing schemes and boards of my right hon. Friend the Minister of Agriculture. But there is the deliberate agricultural policy of the Government, and it has the overwhelming support of this House. My submission is that it is quite useless to adopt a policy with the object of restoring prosperity to agricultures if at the same time we adopt a policy which will make the ownership of land more onerous, risky and speculative, and hence diminish the flow of capital into the land. For a long time past the prosperity of agriculture has depended very largely on the capacity of the land to attract capital to it.

For years past possessors of capital have been willing, for various reasons, to accept a lower rate of interest on money invested in land than was available from other investments, and that has been of immense value to agriculture. A Bill of this kind, which takes away, or tends to take away, the possibility of rises in value must tend to make land very much less attractive than it has been in the past, and if it does hinder the flow of capital into the land it will do a great disservice to agriculture. The first essential of a successful scheme of agriculture is that people should be willing to put money into land, and be willing to maintain it there, as they have done in the past, even with a lower rate of interest than they could get from other securities. One of the main reasons which has accounted for the fact that until recently land has not been without capital is that the possession of land has given a great sense of security. Land has had various values which have accounted for the willingness of capital to accept a low return. There is the amenity value and the sporting value, and, until quite recently, the ownership of land conferred a certain social status. Some of those causes operate to-day and some do not.

The main reason why capital has always been available to finance the farming of the land has been the feeling of security and the fact that the ownership of land was absolute. The old saying "Land cannot run away" was responsible for the fact that the country gentleman was prepared to go on sinking money in his land, putting in drains and financing agriculture in the countless ways in which an agricultural landlord does, because he did feel that he was secure. This Bill, even by itself, must do a great deal to damage that sense of security. The hon. Gentleman opposite made it quite clear that this Bill would be regarded as a precedent. Hon. Members opposite must always go further than we do. They will come into office at some time or other, and they are bound to go a great deal further than we propose to go in this Bill, and it is certain that further attacks on the very existence of property as an institution will be based upon this Bill. It is a perfectly natural and perfectly understandable feeling on the part of hon. Members opposite, and is shared to some extent by hon. Members on this side of the House, that while an owner may have a perfect right to his surface value, he is not justly entitled to the accidental values not created by himself, or to mineral values the very existence of which he did not know about until a few months ago. That feeling is shared by a great many people. I am not going to argue that point now. It was the feeling at the back of the increment duty introduced before the War which did such an enormous damage to housing and accounts for the fact that to-day thousands of people are without houses who otherwise would have them.

If we take away from the ownership of land every hope of increment and leave only the certainty that there will be outgoings, which oh an agricultural estate must always, in these days, exceed the income, we may well produce a state of affairs in which no one will be left to sink money in the land, and if we do that the condition of agriculture will be vastly worse than it is to-day. If the Government do produce conditions of that kind, under which no one will be willing to bear the onus of owning agricultural land, I believe that even a Socialist Government will come to realise that they have bitten off more than they can chew. I am sorry to have spent so much time on that point, but it is one which has not been fully realised, and it ought to be brought out in view of the fact that the Government are doing a great deal to try to restore prosperity to agriculture, which is a very important consideration.

We come to the third and by far the most serious objection. I object to the Bill on the ground of principle, but I object to it far more as one who has been engaged in the practical search for oil, and getting it, on the ground of its probable effect upon the production of petroleum in England. My right hon. Friend told the House that this was a Bill to promote and expedite the search for oil in England, and that that search could not be made under the most favourable conditions unless this Bill were passed. What are the facts? In a written answer to me about a month or so ago my hon. Friend the Secretary for Mines stated that no fewer than five applications to bore for oil had been held up by the introduction of this Bill. Those applications were made on varying dates, some going as far back as 18 months. Some licences had been refused before the introduction of this Bill, but these five had been held up by the introduction of the Bill. Pending the introduction of this Bill it had been decided to grant no further licences. For many years, since an effort which was made towards the end of the War, little or no interest had been taken in the search for oil in this country by individual capitalists or by the Government. Then five people come along and ask for licences.

As the House may know, no one can bore for oil without a licence from the Government. Five people asked for leave to bore, and the Government refused leave, and for reasons which they will not tell me. I asked my hon. Friend why he refused the licences, and he would not say. But all the licences were refused and the Government now come to the House and say they must have this further Bill before the search for oil can be made. The information for which I ask is in- formation which, the House has a right to have before it goes on with the discussion of the Bill. There is some mystery in this matter. The House has not yet been told what is the real reason for the introduction of this Bill. The reason which my right hon. Friend adduced, that it will promote and expedite the search for oil, definitely falls to the ground. My own well, the only oil-producing well in this country, Hardstoft No. 1, struck oil almost exactly seven months after I formally started the machinery. I believe the drillers had drilled some few feet before the formal opening, the "spudding in," as it is called, but it is roughly correct to say that oil was found at 3,077 feet seven months after they first started. Some of these applications for licences which the Government have held up are more than seven months old, and it is true to say that if it had not been for the deliberately obstructive attitude taken up by the Government we might know at this moment whether oil existed in those places or not. The House has a right to further information on that point.

The Government have also said that that the Bill is necessary in order that proper control may be exercised over such drilling as may take place, and that without the Bill we might get reckless or wasteful exploitation, such as occurred in some parts of America, or we might get an unnecessary destruction of the amenities of the countryside. Again, I believe there is no shadow of foundation for that contention. As the House has already been told, under the law as it stands to-day nobody may bore for oil without a licence from the Government, and that licence may be issued to cover such area and with such conditions as the Government think fit. Nothing in the world, I am afraid, will ever prevent a successful oil field from being an eye-sore but if regulation can do it the Government have the power now. I wonder how much the Members of the Cabinet knew about these facts when they decided to introduce the Bill. I am sorry that the Lord President of the Council is not here. I wonder whether he knew of these facts when the Cabinet decided to embark on this legislation. We are told that the Bill was considered necessary in order that oil might be searched for. Did the right hon. Gentleman know that a Department of the Government was deliberately holding up five applications for licences to search for oil?

My hon. Friend the Secretary for Mines in his reply to me suggested that in some cases these licences could not go through because the leases had not been completed. That may be so in some cases but in the cases which have been brought to my notice the leases had been signed sealed and delivered and the whole thing was complete. All that was wanted was the Government's permission and that was deliberately withheld. Did the Government know that an existing licence could be used to cover any area which the licence holder thought fit? I agree that some measure of control is necessary but the reasons which have been adduced by the Government, are, for the most part, entirely fallacious. The existing licence system gives very full power of control indeed and if the Government really desire that oil should be searched for all they want to do is to be a little less sticky about the issue of licences and the matter will look after itself very well.

I think I have shown to the House that, so far from promoting the search for oil, the Government's action has been definitely holding up that search. I think I have also shown that the licence system gives full power for the exercise of that control which we all admit to be necessary. But another reason has been given for the Bill which might carry more weight with hon. Members, especially those on this side. It is said that petroleum cannot be treated like an ordinary mineral, because it is fluid and migrates from place to place. There is something in that point, but very little. It is suggested that owner A on whose land oil has been discovered, may drain the oil from the lands of owners B, C and D in the immediate neighbourhood and that A may get all the value while B, C and D get nothing. In order to meet that difficulty the Government propose to say to owner A, "We shall pinch your oil too." That is not a very satisfactory way of dealing with the suggested difficulty, but, actually, there is no legal difficulty at all. As the law stands, the oil discovered on a man's land is his oil and neighbouring owners have no rights.

The right hon. Gentleman said that supposing oil were discovered in Rut- land, the exploiting company would have to deal, not only with the landowner on whose property the well was situated, but with, I think he said, thousands of other owners in that county. That, if I may say so, is the purest balderdash. It is utter bunkum. The land of Rutland, as far as I know, is not essentially different from that of the neighbouring county of Derbyshire where we are, to-day, getting oil about a quarter of a mile from the boundary of our property and no difficulty of any sort or kind, legal or otherwise, has arisen and I am advised on the best authority that the suggested legal difficulty simply does not exist. It is only the man on whose land the oil rises who is the owner of the oil. Other owners might conceivably think that they had a grievance and this House might think that they had a moral grievance if oil could be drained from considerable areas, but the short answer is that oil does not drain from any considerable area.

The proof of the pudding is in the eating. Our Number 2 and Number 3 wells are both situated within 200 yards of our Number 1 well. The Number 1 well has been producing oil for 15 years, but neither Number 2 well nor Number 3 well has ever produced one gallon of oil. It is not the case that the oil will go to the well. The well has to be dug down to the oil. There are exceptions, but, speaking generally, the migrating power of oil is very limited, ranging from about 100 feet up to—in exceptional conditions—as much as 1,000 feet, which does not represent a very large area. The idea of oil percolating over a great area is unfounded. I wonder whether we shall learn in this Debate who told the Government all these things.

There are solid reasons for control, but they are not those which the Government have so far advanced. They are reasons which cannot be explained in a short time, and if hon. Members are not satisfied upon this question I would urge them to investigate the matter for themselves. They can go to the Science Museum at South Kensington and inspect plans and diagrams of the lay-out of existing oilfields. I wonder, incidentally, if the Members of the Cabinet in considering this Bill knew of the existing practice in Trinidad. There no question of owner ship can arise because the oil is Government owned, and there to-day wells are being sunk no more than 30 yards apart. So they are in Russia, where, again, no difficulties about property can arise. You cannot bore for oil in the middle of a town, and the number of areas outside a town where ownerships are less than 30 yards in extent must, therefore, be very small, and, as I have said, the difficulty does not really arise. But, even supposing that it did arise and even supposing that this House did show an extraordinary tenderness for the rights of property, to try to solve the difficulty by saying that you will bag A's oil as well as the oil of the neighbouring owners does not seem to offer much prospect of giving any real assistance.

I repeat that there are definite and solid reasons why the control of oil development is desirable, and I hope the House will bear with me if I try to explain to some extent the conditions under which oil may be expected. There are various theories about the origin of natural oil, but the one generally held is that it is the product of the fleshy parts of those marine creatures whose boney parts—shells and skeletons—have made up the rock" which we know to-day as limestone all over the world. In the process of formation the oil production was probably not continuous. While the main part of the limestone in our own country was being formed or was being laid down the conditions were unfavourable for the production of oil. They were open-sea conditions. Towards the end of the process of the formation the sea changed its nature owing to disturbances of the land, and possibly owing to the breakdown somewhere else of a glacial period, with the result that the process of limestone formation was arrested and the sea bottom became covered with a layer of mud or clay. I have here some specimens which, perhaps, hon. Members would like to see. I have here, in the first place, a specimen of our oil which is of very high quality. I have also a specimen of the kind of rock formation which may be expected to produce oil, and if the right hon. Gentleman the President of the Board of Trade will take these two specimens and knock them together he will find that even now they give out a distinct odour of petroleum.

The thory is that when the limestone formation was brought to an end there was a deposit of mud or clay of some sort on the top, under conditions which bottled up, as it were, in these forming rocks a certain amount of the organic remains of these marine creatures, and by a process known as selective putrefaction these special conditions gave rise to what we find to-day. This is what happened millions of years ago. Other rocks covered that formation—in Derby shire the whole range of the coal measures—and in most cases these rocks became folded into the formations which are the hills and valleys of to-day.

I am sorry to have detained the House so long on this subject but it is important as bearing on this question of flowing oil because what concerns the petroleum technologist is not so much whether oil has been there but whether it has been kept in position there. In the Pennine Range we have the necessary conditions for oil formation but the rocks are so much fissured that it is almost certain that the oil has escaped millions of years ago. The petroleum seeker is concerned to find not whether oil was ever there or not but whether there is a stratum securely sealing it up and capable of holding it. Without those conditions even if there were any oil there it would not be commercially exploitable. Far from it being the case that the oil flows freely from place to place, it is the case that unless the oil is securely imprisoned and immobile and has been so for millions of years, it is not commercially exploitable.

I drew a diagram this morning which may help to give the House an idea of the simplest and most ideal form of oil-bearing structure. You nearly always have gas on the top measure and almost invariably you find that below there is water sealing in the oil. This is where control is necessary and where there is necessity for the unitary development of a given oil bearing area in order to get the oil to the best advantage. If this gas top is drilled harm is done to the whole of the oil field. The oil itself will not flow for a great distance but the gas pressure can be distributed over a considerable area and the wasteful tapping of that gas can do definite and irremediable damage. Again, tapping near the top where the oil is highly charged with gas can also do harm. For some reason gas dissolved in oil, dissolved gas as it is called, has a greater effect upon oil than free gas and to contract the gas-containing oil in a given area diminishes the fluid mobility of the whole body of oil in a given reservoir. Therefore, control is very necessary but that control can be efficiently exercised through the existing licence system.

I have here another diagram giving a representation of the same oil-bearing structure as seen from above which will enable hon. Members to understand the position of the gas charged oil which had better not be drilled. My argument is that licences can be issued to cover a field of that kind. These areas are not enormous. We talk of them as being very large but a grant of 2,000 acres in Trinidad the other day was important enough to be mentioned in almost every paper dealing with oil. These areas as I say are not large and even though you should get divided ownership on one structure the difficulty is by no means insuperable and if any grievance does exist it ought not to pass the wit of man to frame measures for dealing with it. There has been some difficulty in America but there must always be difficulties where oil is actually being got. Where oil production has not begun there is no real difficulty. In America they are much more tender for the rights of property than we are here, and the ordinary royalty there ranges from the sixth to the eighth barrel, while the highest I have ever heard suggested here is 2s. and what is more normally contemplated is 9d. In America the owner of land gets a sixth or an eighth of the gross value of the oil from his land. While those rights are in existence, obviously very great difficulty arises, much greater difficulty than would arise herein allocating oil ownership. Oil does not actually flow very far. Anyone who is extremely tender for the rights of property might maintain that an owner whose oil is not got because getting it would be injurious to the whole oilfield might hold that such an owner is entitled to compensation, but I do not think that Parliament need concern itself much with that difficulty. It is a fact that on Government land in Trinidad, where no property rights arise, wells to-day are being sunk 30 yards apart. In Russia, where again no question of oil property can arise, wells are being sunk which are almost touching each other. This sort of thing is going on, and oil is being successfully got all over the country with the wells much closer than the right hon. Gentleman led the House to believe.

What becomes of the Government's case for the Bill? It is not necessary to have a survey made. It is not necessary to secure control. The licence system provides ample opportunity for control. It is not wanted in order to deal with the alleged proprietary difficulties; they do not really exist. What is the real reason? The House is entitled to very much more information than has been given. We know little about the object of the Bill. We know that it was not introduced as a result of any public demand. There has been no Press agitation demanding a Bill of this kind. Until the Bill came on I did not know of a public demand of any sort. I would hazard the suggestion that the Bill did not originate spontaneously from the Cabinet. It may be the case—I do not know—that the Prime Minister may have come down one morning and said, "Well, boys, we have conquered unemployment, we have solved the Disarmament problem, all the milk and meat farmers are happy, everything is OK., and there is nothing whatever to do except to bring in a Bill to deal with any oil which may be found in England." That is possibly an explanation of this Bill, but I would hazard a guess that it was not the right one. I believe that someone has been talking to the Government about the Bill, and I should like to know who it is. Has the right hon. Gentleman or his Department or the Government been in communication with any oil company operating in any part of the world about this Bill? The House is entitled to an answer to that question before it goes on with the Bill.

I beg of the Government to proceed cautiously in this matter. I would remind them that the greatest scandal which has ever taken place in connection with oil has not been the recklessly competitive development in Texas and other parts of America but the "Teapot Dome" scandal—where the oil and the land alike belonged to the Government. That broke the Harding regime in America and led to the death of the President and the flight or arrest of most of his friends. I hope that we shall not get into that position in this country, but we are dealing with very serious matters. I would remind the House that the Bill not only confers upon the Crown a monopoly of property in oil, but it also confers upon a Government Department, working in conditions of complete secrecy, the right to withhold concessions which may be worth many millions of pounds. It is true that the Government have to give particulars in public of what concessions are granted to anyone, but there is no publicity of any kind about the withholding of concessions. That is difficult and dangerous ground. We ought to know what is really at the back of the Bill before we decide to proceed with it. I have told my right hon. Friend the President of the Board of Trade and my right hon. Friend the Lord President of the Council my reasons—and they are weighty and serious reasons—for believing that things are not as they should be in connection with the introduction of the Bill. I beg of them to take that warning in time.

I shall be bound to divide the House on this Bill in any case, even though I get very little support, but meanwhile I venture to put a suggestion to the Government that they refer the Bill to a Select Committee. I know that that is an unusual course, especially in view of the fact that the Bill has already been discussed elsewhere. It is not a party Bill, but one dependent upon a great mass of technical details. These details ought to be considered by a committee which can hear the evidence in a judicial and an impartial way. It would really be impossible, I believe, for the House to deal with the details pi this Bill in Committee of the House. It would make it really impossible to get a proper thrashing out of the details of the Bill which is very necessary. I know that the Government do not want to use their great powers to do anything which they should not do. I believe that there is a grave risk of their doing something very wrong indeed and something which we may regret for generations if they do not give the Bill greater consideration than has been the case up to now. Even upstairs in Committee the party system must prevail to some extent and you cannot get the judicial kind of consideration which is desirable in a technical Bill of this kind. I do not want a drawn-out Bill, and if it goes upstairs in Committee I shall not attempt to kill the Bill by time. I think that a far better system would be that the Bill should be considered by a Select Committee upstairs.

Mr. K. GRIFFITH

A Select Committee is not judicial.

Marquess of HARTINGTON

I hope that this House is not incapable of creating a committee if we are not in conjunction with another place, in which we might get back to the idea of the judicial committees of the past. I put that consideration to the Government. We are dealing with very important matters of principle, and of policy and expediency besides. I, therefore, suggest to the Government that the Bill should be considered by a Select Committee, and meanwhile I beg to move the Amendment.

5.25 p.m.

Mr. M. BEAUMONT

I beg to second the Amendment.

I am hampered in seconding the rejection of the Bill by not having at my disposal the knowledge and erudition of the Noble Lord who has delivered such a weighty indictment against the Measure, but there are certain considerations which I would put to the House and which I would like to reinforce by specific questions to the Government. I agree with the Noble Lord that we have had nothing like enough information in respect of the Bill. The right hon. Gentleman the President of the Board of Trade skated very lightly over some very important points when he was making his introductory speech. He told us that the present system did not work, and the only evidence he gave us of it was a statement about the county of Rutland, which, I think, on reflection, even he will regard as considerably exaggerated. He told us that there was a need for the Bill, but he did not tell us why, and no solid reason has yet been adduced why the Bill has been presented. There is no question whatever that there is considerable anxiety about the matter both inside and outside this House. If there has been a recrudesence of interest in the finding of oil, we should like to know why and what evidence there is of such recrudesence.

The right hon. Gentleman has said that it was the present law which prevented the proper examination and investigation of the question of boring for oil. I am informed, on the contrary, that it is the extreme improbability of finding it which is really at the back of the search for oil. The fact that a very careful geo- logical survey of this country shows that there is oil only in very small quantities and in a very small number of places, is really at the bottom of the fact that there has been no widespread search in this country. If the Government have any reason to believe that the geological information has been adequate, before this Measure is passed we have a right to know the facts. The hon. Member says that it is not Socialism. I think he is right. Socialism is nationalisation in the presumed interest of the country. We are afraid that this is confiscation in favour of the oil interests, and on that we want re-assurance before we pass the Measure. I will tell the right hon. Gentleman what is being freely said both inside and outside this House, namely, that the oil interests have reason to believe that at a lower strata than that hitherto examined, there are large quantities of oil, and that they are holding a pistol to the head of the Government, using the argument of the desirability of developing oil in order to give a larger profit to themselves by removing the royalty. That is being freely said.

The right hon. Gentleman, when he spoke, said, "Trust the Government." I cannot imagine that there is any hon. Member of the House who would suggest that the Government would knowingly be a party to anything that was improper. The Secretary for Mines says that I am doing it. I am doing no such thing. I assure the Secretary for Mines that I do not suggest for a moment that the Government would knowingly give way to those interests. I want to be assured that they have taken steps to assure themselves that there is nothing going on behind the scenes. That is what I am asking. I have sufficient faith not only in this Government but in any other Government not to believe that they would be influenced by any outside interest, but I have not sufficient faith in anybody's judgment not to believe that on occasion they may be hoodwinked and misled by powerful interests. I want a statement from the Minister that he is quite certain he has made every possible investigation and is satisfied that nothing of that sort is taking place. I should definitely like a statement from him of reasons that make the Bill necessary and a refutation of the arguments put by my Noble Friend, in which he says—and I must say that although my information is not drawn from such expert knowledge it agrees with his—that as far as is known the present system works perfectly well, and is adequate.

I want to turn to a point which was more lightly touched upon by my Noble Friend, and that is the, question of amenities. It is an interesting coincidence that the present Secretary for Mines was. connected some few years ago with the promotion of a Bill which, he said, was to safeguard amenities, and which we believed safeguarded nothing, but high rates and quick ribbon development. My Noble Friend and I were associated in opposition to that Bill, and I believe results have proved that we were fully justified. Now the Minister produces a Bill which must have a very deleterious effect upon the question of amenities. He will reply that there is in the Bill a provision that the Railway and Canal Commission in granting a licence shall have regard to local interests.

Let me put this question. What representations will it be possible to make to the Railway and Canal Commission, and how much will questions of amenities weigh against the pressure of those who have a licence? It may be that local authorities will be able to make representations, but some of us hold that local authorities are by no means the very best people to safeguard amenities. I want to know whether local residents, owners of property, will have an opportunity of making representations at any inquiry? I also want to know on what ground he believes that the Bill is going to increase facilities for seeking oil? There is one thing which you are certain to get, every owner of property, as far as he is personally concerned, will be resolutely opposed to allowing anybody to investigate the question of oil on his property. Once it is found he is in this position, that he may be compelled to sell to the licence holder a small portion of his property, I agree at a fair price, the value of the land plus 10 per cent. for compulsory purchase; but once he has sold it, it may be only a field, the operations of the oil company in that neighbourhood will make the whole of his property perfectly untenable and he has to sit there while the character of his home is changed, the district made horrible and large fortunes made by other people out of his property.

Mr. HOLDSWORTH

Will the hon. Member explain where the position for the landowner is made worse by the Bill? Is there not an added protection given by the Bill?

Mr. BEAUMONT

The difference is simple. Under the Bill he is deprived of the extra compensaton which he gets now by royalties. At the present moment he gets royalties, which may be some slight compensation for the disturbance he has to suffer. He is to be deprived of that, not for the benefit of the State, but for the benefit of other people. That is neither justice nor common sense. It is going to place owners of property almost unanimously in opposition, doing their best to prevent the necessary investigations to see whether oil is there or not. I do not want to weary the House at this stage and I will conclude by emphasising the reasons which have been so ably given by my Noble Friend against the Bill. I believe the Bill to be unnecessary, inequitable, unreasonable, and against every principle of justice and property for which I at any rate have always stood, and if no hon. Member goes with me into the Division Lobby I shall nevertheless oppose the Bill now and at every other stage.

5.34 p.m.

Lieut.-Colonel Sir ARNOLD WILSON

Few of us when we entered the House this afternoon expected that we should listen to such an extraordinarily interesting disquisition on the demerits and merits of the Bill as we have heard from the Noble Lord the Member for West Derbyshire (Marquess of Hartington). It would really have done credit to the field or general manager of an oil company. I was deeply interested by his explanation of the geology of the question but may I say as one who has been the manager of an oil company and has had some connection with the legal side of the oil industry that his arguments are not of universal application. I was recently in Germany and visited one of the oilfields. I was told that it was necessary for them to acquire rights over two or three thousand different holdings before they could proceed with the developments on the salt domes. The question of gas pressure is not quite so simple as I think the Noble Lord would suggest. He took us back in his historical research to William the Conqueror. I will not go as far back as that, but I would point out that an Act of Edward I, passed in, 1287, known as the Apex Law, gave to those who sought for tin and lead the right, if they discovered it on one piece of land, to follow it on land belonging to other owners, subject only to compensation for surface rights, in order to give the discoverer the full fruits of his labour.

This Bill is not an unfair analogy. Its object is not to introduce Socialism or nationalisation but to enable private enterprise to benefit from the results of its own initiative. The hon. Member for Aberdare (Mr. G. Hall) suggested that the Government should invest money in the search for oil. I would remind him that so far only two Governments have done so and in each case with disastrous results. The Australian Government spent £500,000 or more money and lost it; the Government of Argentina spent many millions of pounds, and to the best of my knowledge have never made one penny. In this country His Fajesty's Government have spent £500,000 or more and again got nothing. I do not think it would be a good way of investing any further surplus which may accrue to the Chancellor of the Exchequer. The main justification for the Bill is that suggested or rather inferred by the President of the Board of Trade; the danger of offsetting. Under the present law it is impossible to prevent one landowner from putting up wells all round the edges of his neighbour's land. This is offsetting and it is terribly wasteful. America has become a byword for wastefulness for it has proved impossible to control production there—

Marquess of HARTINGTON

I am reluctant to interrupt the hon. and gallant Member but in my own case I am prevented from sinking any well within 100 yards of the boundary.

Sir A. WILSON

One hundred yards is certainly much more than the average. One hundred feet is much more general in America and I should certainly object if I were in the position of the Noble Lord.

Marquess of HARTINGTON

I should have said feet.

Sir A. WILSON

One hundred feet may be ample, it depends on circumstances. I submit that the Bill is justified by all experience in America. The Noble Lord spoke of the danger of royal monopolies. I have had some experience of obtaining concessions in foreign countries where royal monopoly actually exists, as in Argentina, in Spain, in Venezuela and Colombia, and I confess that there has been very little dishonesty or corruption, as far as I know, in regard to the administration of royal monopolies. It has been possible to lay out and plan in advance the general structure in a way which has certainly redounded to the credit of those responsible. The greatest and most successful oilfields in the world are those which have been started under the [...]egis of a royal monopoly. The hon. Member for Aylesbury (Mr. M. Beaumont) referred to the question of amenities. I think that question can be overstressed. The greatest of all amenities is livelihood, and there is no step we should not be willing to take in order to secure a livelihood for our own people from our own land. From my own personal knowledge there are practical difficulties which arise from the absence of any definite system of control or licence. The provisions of the 1918 Act were made exceptionally unattractive to anyone who desired to go further in the matter. Licences could have been granted, but in fact nobody asked for them until very recently. Let me revert to the question of amenities. I have been connected with oil produced in California and Colombia, where so far from agricultural interests being damaged very little damage indeed was done to the soil other than in the immediate vicinity of the bore hole. The odour that arises from petroleum is not so serious as to interfere with the raising of cattle. I think the hon. Member rather overstressed that point.

I have a strong conviction that without this Bill there is no possibility of progress. It is not to be supposed that anyone expects to find great oilfields in England. The German Government during the heat of the War made desperate efforts to find oil, but were only able to produce some 130,000 or 150,000 tons. There is reason to think, according to geological theory, that the strata beneath England is not dissimilar to the strata beneath Germany. We have that at least in common with Germany. The difficulties which arose in Germany were largely the same difficulties which arise in this country to-day, the necessity of dealing with great numbers of smallholdings. The German Government under its present constitution finds it impossible to stimulate oil production by subsidies or grants because of the practical difficulty of getting permits from the various landholders, and after 20 years they have only doubled their production, which is now in the neighbourhood of 350,000 tons. This is being used to produce lubricants. We can produce most of the petrol we require from coal, but we cannot produce an excellent lubricating oil from coal. When we get oil it will be used to produce lubricants, and will be of the greatest value to national safety.

Government control abroad in the oil industry has not had the results which the Noble Lord suggested. In my experience it has been reasonable and free from corruption, and I rather resent the reference to the "Teapot Dome" scandal in connection with England's green and pleasant land. I do not think it was worthy of the occasion. As for the insecurity of agricultural land, I do not think that argument should be taken very seriously. The possible areas of England are very little limited, and the probability that any large area will be involved in oil is exceedingly small. When in foreign countries private properties are appropriated in order to produce oil-fields, they do not in practice, as was suggested by the hon. Member for Aylesbury, take a few fields and leave the rest The invariable practice is to buy a whole estate. I do not feel nervous, in the light of my experience, of the prospect of Government officials acting unreasonably or arbitrarily in such matters. I feel that we have a far better chance from our own officials than I have ever had in my own business experience abroad from officials of foreign countries, and I earnestly and confidently commend the Bill to the House, and hope that it will have a fair passage.

5.46 p.m.

Mr. TINKER

I am in a curious position to-day, for I am supporting a Measure that has come from the House of Lords and which is opposed by the scion of a noble family. I have always believed that nothing useful to the community could come from the Lords, but on this occasion they have brought in a Measure which we on this side are bound to support. I suppose that they are seeing ahead of their time, that they realise this is a national need, that somehow or other we shall acquire oil, and that they want the nation to take charge of it. They are far-seeing and wise in adopting the attitude they have. I am rather curious to know how the opposition to the Bill has developed. I must thank the Noble Lord who moved the rejection of the Bill for his lesson in geology. Although I have attended mining schools, he gave me an outline in the finding of oil of which I had no knowledge at all. I did not know how oil had developed and he has told us the theory as to the formation of oil deposits. I can, however, see nothing else good in what he has told us. He seems to be very narrow-minded in his attitude to the whole of this question. He first told us that there was little or no hope of any oil being found in this country, and that therefore it was hardly worth while the Government taking any control at all. Then he went on to say that the people who had possession of land were entitled to all the values that might be found underneath, and that unless they had that right we should see very little land bought or owned. That is to say, people would not own land if they knew that they would be deprived of something of which there was very little hope, and, because of that, they would get away from the land and have nothing to do with it. When that time comes it will be a good thing for this country, for the land and land values will then pass into the control of the State, and we shall be a step nearer Socialism.

We have always heard from the other side about the integrity of the House of Lords. This afternoon hon. Members opposite have criticised the House of Lords for having adopted a Measure like this. They said in a sense that the House of Lords had no control over passing this Measure for they were merely the handmaidens of somebody behind the scenes, and that they had been forced to bring in a Measure in which they did not believe. That is a sad reflection on the House of Lords. I hope that when the Noble Lord ultimately gets there he will examine his speech to-day and see what he has said about it. He said, in effect, what we have always said about the hereditary principle, that it should have no place in the Constitution, that it ought not to govern us, and that it really had no voice at all. The hon. Member for Aylesbury (Mr. M. Beaumont) challenged the President of the Board of Trade for concealing something and asked him to give the whole story. It is a grave matter for Government supporters to come out with remarks like that. The hon. Member said that someone behind the scenes, some oil magnate or someone else was pulling the strings behind the Government and forcing their hands.

Mr. M. BEAUMONT

I know that the hon. Member does not wish to misrepresent me, and it may be that I did not make myself clear on this point, but I would like to do so. I did not suggest for a moment that the Government are having strings pulled by those interested. I did suggest that it is possible that they are being misled by those interested.

Mr. TINKER

I have heard the hon. Member very often and his speeches are always very clear and show that he thinks a position out Very well. I heard him last week on the Mosley episode, and when he says anything it is well thought out. I hope that he will read what he said about the Government. He inferred that the Government were being driven by somebody behind the scenes. If he did not, why did he demand the whole story? What is the whole story? It must be something that the Government have not brought out and to say that to a Minister of the Crown, who, after all, does make clear and definite statements, is a sad reflection on Members of the National Government. If it had come from this side there would have been a howl from hon. Members opposite. It has come from two hon. Members on the other side who occupy high positions, and I hope the Minister will deal with them in the manner in which they ought to be dealt with.

The President of the Board of Trade said that the landowners ought not to claim oil that came from their estates, and he gave certain sound reasons. I maintain that no landowner has any right to oil found under his land, and that it is a matter for State control. The Noble Lord argued that deposits that were laid down millions of years ago should in the twentieth century belong to the individuals who happened to own the land under which the deposits existed. Surely what nature has done in times past does not belong to any particular mortal in this age. It ought to be used for the benefit of the whole community and not for any particular person because he happens to own a piece of land. Therefore, the Government are following on the right lines in this Bill. They recognise what is likely to happen and are now getting ready to arrange for State control of any oil that may be found. I wish it had been done many years ago in regard to coal. It would certainly have given us more satisfaction than what we are enjoying now.

I strongly appreciate the provisions in this Measure dealing with amenities. I put a question to the Forestry Commissioners to-day dealing with this point. I asked whether the commissioners had any power to do anything with derelict parts of the country where collieries have closed down and left unsightly heaps. I was told that it was unprofitable to plant trees in such places, which meant that these unsightly heaps will have to continue for a long time. Where coal mines have been worked and coalowners have taken all the value from the land, they have left scars on the countryside, and the poor unfortunate people who cannot get away from them have to live as best they can near these spots. We have no power over the coalowners to make them do anything. The provisions in this Bill dealing with similar circumstances in connection with the finding of oil are very satisfactory. They mean that where oil is bored for, those who take the oil, namely, the State, will have to put the countryside back to its natural condition. That recognises that the people should have the benefit of that to which they are fully entitled. Up to the present, private enterprise has never thought of anything like that, and where factories and mines have been established there has been no question of the effect on the countryside. There are isolated cases, of course, just as there are good employers, but they are not many.

No one can take objection to the State taking control, and no one on this side will object to what has come from the House of Lords in this instance. We are threatened with a Division and we are interested to see what will happen. I do not think there will be any Division. The Noble Lord suggested a committee as a way out of voting against the Government, and the hon. Member for Aylesbury said that if the Noble Lord went to a Division he would follow him. I have heard that talk about Divisions before, and I do not think there will be one. The two hon. Members will regret what they have said when they read their speeches. We on these benches welcome the Bill, and I frankly take it as an instalment of Socialism. I was speaking to a Noble Lord not long ago, and he told me that in his opinion it was a step towards Socialism. It is not going the whole way, of course, but it puts into the hands of the State the power to take over what ought to be national property. Because of that, I shall support the Measure with my colleagues if it goes to a Division.

5.59 p.m.

Captain WATERHOUSE

I will tell the hon. Member for Leigh (Mr. Tinker) straight away that unless something un foreseen and very much hoped for happens, there will be a Division on this Bill. I should like to congratulate my right hon. Friend the President of the Board of Trade on the cordial support he has received for the proposals of this Bill from the Leader of the Opposition, from the hon. Member for West Middlesbrough (Mr. K. Griffith), and from the hon. Member for Leigh. I have always noticed that when matters involving real vital principles are raised in this House there is a curious tendency to cross vote. We on this side think that we are straight in our Conservative views, and hon. Members opposite that they are straight in their Socialist views. But when a direct issue arises there always occurs to some of us some reason why we should not be too Conservative, and to some of them why they should not be too Socialistic. On this particular occasion I propose to devote my remarks to only one main point in the Bill, that is, the first two or three lines of Sub-section (1) of Clause 1, which reads: The property in petroleum existing in its natural condition … is hereby vested in His Majesty. It is as well, when we have to consider a major issue, that we should get as near as we can the basis on which we rest our principles. In this particular regard, we have to decide for ourselves our position vis-a-vis the State.

In this Island there were individuals long before there was a State. The State is the creature of the individual, and we are not the servants of the State. It is true that we have by common consent given the State very great powers, but we expect from the State very great duties; possibly the principal duty of the State is to protect the life, liberty and property—all three—of the subject of that State. It is only so long as we can be sure that those whom we put to govern us in the State are proceeding on those lines, that they have any right to call for our allegiance to the State. In giving the State those powers we have said, for example, that for certain misdemeanours we may lose our lives, our liberty or our property, and that if a certain eventuality arises we may be told categorically by the State that what we have considered our rights in the past may no longer be our rights in the future. We agree that property has great responsibilities and great duties as well as rights. If we had come to no agreement on those lines, the ownership of property would have been absolutely impossible in this country. So far we have never agreed that a specific section or type of property belonging to a small group of individuals should be confiscated without compensation and without appeal, and I, for one, will set my face as resolutely as I can against the inception of any such principle in this country.

Now I turn to the question which was raised by the noble Lord the Member for West Derbyshire (Marquess of Hartington) and which so intrigued the hon. Member for Leigh, which was as to why this Measure has suddenly become necessary. Why has this bolt from the blue descended on us from the House of Lords? What is behind it all? That, is what we want to know. My right hon. Friend who moved the Second Reading was not very convincing. It may have been that he felt that he had not a very good case, or that he felt that he had something that it was not desirable to disclose. If there is anything of that sort, let him come forward and say so. We are not prepared to press him to make disclosures which he thinks are not for the common welfare. If there is something there, either let him disclose it or let him say that the time is not opportune to make any statement. Do not let him leave us with the feeling that pressure has been put upon him from some source, possibly because the British Government are very large shareholders in a large oil corporation. I do not know, but these questions are bound to arise when one gets this dreadful system of a State-owned trading company. We know that the British Government have the majority of shares in a certain oil corporation.

The right hon. Gentleman said that we could not permit sporadic development throughout the country, and that we should have a general system. Let us see where we stand. It was only a few months ago that the Government introduced a Measure to back a great scheme for producing oil from coal which was generally welcomed by hon. Members opposite, as well as from this side. Many hon. Members opposite represent the coal mining districts, and are supporting a Bill for the development of the natural oil resources of the country. Have they thought what their position is to be before their coal-mining constituents? Are they going along to them and say, "We have decided that coal mining is becoming rather obsolete. We may get a certain amount of oil from coal, but it had better be got from crude oil. It will not benefit our constituents it is true, but we take a much broader view. If we can develop an oil field somewhere else it will be much better for the State as a whole and, therefore, you, for the moment at any rate, can lump it." Is that the attitude that they will take up? If not, we shall be interested to know what it is. Boring for oil will take very few men, as compared with the large personnel required in producing the machinery for the distillation of oil and the still larger indirect labour required for the production of the coal to work in that plant.

I want to go back to the main argument of the right hon. Gentleman that if we are to develop oil in this country it is necessary to have some scheme of nationalisation of royalties. He based that on what he said was the fact, which was disputed by my Noble Friend the Member for West Derbyshire, but was supported by the hon. and gallant Member for Hitchin (Sir A. Wilson) that there might be great difficulties with royalty owners over areas where there are a large number of small landlords. If that were so and if there were a difficulty, could it not be surmounted without flying in the face of the convictions of so many of those who, I believe, are the Government's best supporters on these benches? Would it not be perfectly practicable, instead of putting in these two or three lines at the beginning of the Bill, to set up a commission with power to grant licences on a specific royalty, and, after deducting from it their expenses and, if you will, a tax for the benefit of His Majesty's Government, to distribute the residuum to the owners of the land under whose property the oil was won Would not such a system be practicable? It might be, and probably would be, cumbrous, but it would not be definitely and clearly dishonest.

I realise the importance of a vote which is cast in this House. I do not think I have ever voted against the Second Reading of a Bill introduced by the Government that I support. I have put before myself this general guide, that unless one thought that an issue was important enough to face one's constituents upon at an election for Parliament, we have no right to expect to be carried upon the backs of our friends. I support not only my party but also the National Government. I do not sign letters to the Press to suggest that we should give up our party label, any more than I should suggest that Liberal or Socialist supporters of this Government should give up theirs. I am a supporter of the National Government and would do a great deal to maintain it. If my right hon. Friend had come down with another reason; if he had said that the Government were much too Conservative, that he was approaching the matter as a Radical, that the attack on royalty owners or potential royalty owners was in accordance with fair and logical Radical principles; or if he had said that the Prime Minister or his Socialist supporters looked upon this as a necessary counterbalance to certain proposals which have been introdced lately, I should have been inclined to waive my objections, and to have supported the Bill for the sake of the National Government. I do not believe that that is the situation at all.

So far as I know, since the Prime Minister has been in a responsible position, either on this side or when he led the party opposite, he has never suggested confiscation without compensation. It is a very great misfortune that it should have rested with the National Government to introduce such a principle. I believe that the Bill is not based upon any national principle, but that it is the result of mere thoughtless idleness. It is thoughtless because right hon. Gentlemen did not take the trouble to realise the tremendous repercussions which it will inevitably have. We have heard Debates in another place, and the speech of one of the Leaders of the Opposition who said that the Bill would be quoted as a lasting precedent for the nationalisation of royalties. It is idleness because right hon. Gentlemen have not taken the trouble to investigate all the possible other ways of achieving the perfectly legitimate object of the Bill. The Bill outrages what we have always considered to be one of the main principles for which we stand as a party. Unless my right hon. Friend makes some statement I am afraid that it is not possible—though I very much hope that it will be possible—for me to go into the Lobby in support of the Bill this evening.

6.13 p.m.

Lord EUSTACE PERCY

May I, in supporting the Second Reading of the Bill, and replying, as far as I can in these few moments, to the arguments of my hon. Friends who oppose it, begin by saying that when I hear a case supported by vague suspicions as to something that may be happening behind the scenes, I always begin to have serious doubts as to the strength of the case. That may be because I spent my early years in diplomacy, and that I learnt from bitter experience that the people who are always looking so hard for the cards under the table that they could not see the cards on the table, were the worst guides in international affairs. My noble Friend the Member for West Derbyshire (Marquess of Hartington) challenged the Government to reveal, divulge and say. I am not sure that, my noble Friend ought not to be challenged to say what he meant. He started with a vague reference to the most resounding scandal in one country that has ever taken place, and then, as I gathered, he indicated to right hon. Friends of his own that he was not satisfied that all was right, and he hoped that they would take warning. Really, an elusive statement of that kind is likely to create, not, I think, in this Chamber, but outside, impressions which I do not think my Noble Friend ought to create without saying exactly what he means.

Marquess of HARTINGTON

When the time comes.

Lord E. PERCY

It is not a question when the time will come, but a question whether the time has not arrived now. As to my Noble Friend's specific question whether the President of the Board of Trade had ever talked to any oil company engaged in international business, I sincerely hope that he has. I hope that the Government are not launching upon any policy without consulting the experience of the people who have the most experience in this matter, and I do not think the fact that they have oilfields in more than one country should make them bad advisers of His Majesty's Government as to what sort of administrative policy should be pursued in this country. But let me assure my Noble Friend that at any rate I have not talked to any oil company since I left an oil company some 10 years ago, and that my speech is not based on any such surreptitious and suspicious communication as that.

A question like this can be discussed either as a matter of individual property rights or as a matter of public policy. The question of individual property rights has not been raised prominently by those who have spoken in favour of the Amendment, with the exception, I think, of my hon. and gallant Friend the Member for South Leicester (Captain Waterhouse). I would only say on that question that, if you are to defend and hold the old Tory position of the rights of property, you must not elevate those rights into an abstract dogma which has no relation to reason at all; those rights must have a reasonable and a practical basis. My hon. and gallant Friend may be surprised to know that, when this question of the discovery of petroleum came up at the end of the War, more than one of the oldest Tory landowners in this country were very strongly of the view that for them to assert a property right in a windfall of that kind would be equivalent to giving away completely any chance of really defending the real rights of property. That is a Tory view which I should hold myself, and I think the Tory party—because I am a Tory rather than a Conservative—will be very badly advised if they ever revert to a purely Whig attitude about the rights of property.

But that, as I have said, has not been the basis on which this case has been argued to-day. It has been argued frankly by my Noble Friend the Member for West Derbyshire as a matter of public policy, and the case of the opponents of the Bill is a case with which I have the very greatest sympathy. It is that the private ownership of property, and the private ownership of mineral rights in this country, has been a sounder principle of government, and has secured sounder development, than the State monopolies of mineral rights in other countries. That is a very tenable proposition, but it is made entirely untenable if you start your history, as my Noble Friend did, with the history of royal monopolies. What a royal monopoly of trade and Empire has to do with the ownership of minerals I cannot conceive: the issues raised by the two things are wholly different.

As a matter of fact, we have arrived at our position in this country, as usual, entirely by haphazard and chance There are certain minerals, namely, silver and gold, which are royal monopolies, and have been since the beginning of time. There are certain minerals to which, anyway up to the end of the Middle Ages, the principle of search and following, to which my hon. and gallant Friend the Member for Hitchin (Sir A. Wilson) has alluded, applied. But I am not going through the complicated history of mineral rights in this country. There is no dispute about the fact that as a general principle, given a tabula rasa, no Government to-day would abandon its monopoly of mineral rights. No British administrator in a British dependency would abandon Government ownership of mineral rights, and I do not think there is any administrator in India who does not regard as one of the worst mistakes over made by a Secretary of State for India an obiter dictum of, I think, Lord Cranbrook, in this House resigning the mineral rights of the Government in Bengal under the Permanent Settlement.

But, while that is the general principle, it is the fact that a Government monopoly of mineral rights, where you have a tabula rasa, does not work particularly well. I, like my hon. and gallant Friend the Member for Hitchin, have been in the position of a concessionaire of Government mineral rights, and I cannot say that I have a very high opinion of the forethought or the planning or the ideas of conservation which governments in that position entertain. That is why there is much to be said for the view that in this country we hit upon a better expedient. Mineral rights, at any rate the most important mineral right of coal, came into the hands, generally speaking, of very large landowners, men who were rich enough to be able to forego the profits of over-rapid and wasteful development, and at the same time were reasonably anxious, like all human beings, to accumulate as much wealth as possible for their descendants.

They were also men who lived a leisured life, and, therefore, were naturally particularly anxious for the amenities of the countryside; and, apart from the question whether they did not get too much money out of it, and are not getting too much money to-day—that is quite another question—as planning authorities I think there is a great deal to be said for the proposition that, as a matter of public policy, the great landowner was a much better planner than the Government would have been of mineral development, just as he was a much better planner, at- that time, of urban development where he was the one big landowner controlling the development of a whole town. If anybody doubts that, they might compare the development of Grimsby with the development, say, of Hull on small freehold land. It is a matter of opinion, but at any rate there is a great deal to be said for the proposition as a matter of public policy.

It depends, however, upon the large landowner, who does own the whole of an urban site, or who does own a very large mineral area; and all Governments, including the present Government, and all parties, including the Tory party, have to recognise that, where you have surface ownership split up among a number of comparatively small people, mineral rights must not be similarly split up. Tory Governments have recognised that fact. You have only to look at Mr. Wyndham's Irish Land Purchase Act, 1903, where it was recognised, and where no one disputed the fact that, if you are going to sell to a number of smallholders the land which they have farmed, you must reserve, as we reserved to the Land Commission, the mineral rights involved. That is the kind of atmosphere in which you have to consider the question of public policy. You have to consider it in a wholly different light. To-day, with the exception, if I may make a personal remark, of my Noble Friend the Member for West Derbyshire and a few others, the great landowner is disappearing, and you are dealing with a multiplicity of small owners; and you cannot expect that mineral development will take place under such a regime in anything like the same way in which it took place under the regime of the big landowner.

We now come to the particular question of this Bill. My Noble Friend directed two arguments against it. One was that this nationalisation of mineral rights as regards petroleum would divert capital from the land. I really cannot see that it would. If the investment of capital in the land is to depend on the purely speculative development of one man having some petroleum rights which are worth developing, surely that element is insignificant, and surely, if any man is going to speculate in petroleum, he is not going to do it through the purchase of land. The rights in regard to petroleum are of far too little speculative value for any man to invest in land for that purpose. Then my Noble Friend proceeded to try to demolish the argument of the President of the Board of Trade as to the necessity for this Bill, and tried to show that, so far from development being held up by the present position, it was this Bill which was holding it up. I do not think that his first point, that five licences were being held up pending the passing of the Bill, was a very strong one. A change of policy is involved, and it is only natural that a Ministry should hold up administrative measures which cut across a particular piece of legislation. Personally, I should be willing to wait two or two and a-half years if after that I could have ordered and planned development.

But, quite apart from that, says my Noble Friend, there is no reason for this Bill at all; you can do under your present licensing system all that you want. And then, if he will allow me to say so, he rather rode off on an injudicious remark—if he in turn will allow me to say so—of the President of the Board of Trade about oil going from one man's property to another. Of course it is quite true that, as my hon. and gallant Friend the Member for Hitchin has said, the rate at which oil travels varies very much, according to the strata in which it is travelling. My Noble Friend, in his very interesting geological lecture, did not sufficiently explain to the House that the formation in which the oil is found is not necessarily, or even probably, the limestone formation in which it is generated. The oil may be in a very porous medium like very porous sandstone, when it will travel considerably greater distances than my Noble Friend gave the House to believe. But that is not the gravamen of the reason for this Bill. When hon. Members ask what can be the reason for this extraordinary development on the part of the Government, I really wonder whether they have devoted any thought to what the ownership of property in minerals really means. My hon. and gallant Friend the Member for South Leicester said that surely it would be quite easy to get over it in a different way. You are to see that the sacred rights of property in minerals are respected, but you who own the mineral are not to be allowed to bore for it without a Government licence, and we have a right to give a licence to anyone we like over any area of land we like. It will be for him to say on whose property in that area he will drill and, where he drills, there he will pay royalties.

It is not a question of the distance that oil will travel. It is a question of the holding formation of the oilfield. It may be a long anticline extending over five or six miles. The chances are that, if you get good holding oilfield in one anticline, you will have neighbouring anticlines and subsidiary anticlines, and any oil company that wants to do planned development will want to own not only the whole of one anticline, but the whole of the area of subsidiary anticlines, and possibly the neighbouring one. They may open their mouths too large, I am not dogmatising on how much of the property a single oil company ought to have but it is quite likely to cover an area of five, six, eight or twelve or more large farms. It may cover a large number of quite small properties, cottages and so on, in individual tenure, and if each of those people has a right in the oil under his property, the State is exercising a pretty large discrimination in saying, "No, you shall not keep your own property, because we think it desirable to hand it over to someone who will drill on this bank of the anticline first and then on the other bank of the anticline, leaving the subsidiary anticline for five or ten years before he drills, and all the time you, who enjoy the sacred ownership of your own property, are not to be allowed to work it, and probably will never be, because if you are quite a small holder the well will not be put down on your property and the neighbouring man will get it."

I ask the House to consider that a property right of that kind, interfered with arbitrarily by the State in all those ways, is a property right that is not really worth having. It would be worth having if a big landowner were owning the whole of the anticlinal formation, but if it is a case of a number of small people, it is almost impossible for the State to act fairly between them. The only reasonable policy in that situation is to take over the mineral rights in the interest of property development. It seems to me obvious. I think all these laboured attempts to prove that it is not necessary are flying in the face of common sense. It has nothing particularly to do with the peculiar nature of oil except in this one respect, that you are not dealing with a static seam. You are dealing with a structure tampering with which at one point on one person's property may seriously damage development elsewhere, if only because you will release the pressure on which you depend elsewhere for flowing wells and to save the cost of pumping.

I have given the reasons why I shall support the Bill and I would ask those who are opposing it to consider the problem not in the controversial spirit that they have exhibited hitherto. No one admires more than I do my Noble Friend's extraordinarily fine and cogent debating speech, but it was very controversial. We should consider this far more in relation to the broader issues of industrial development, with the protection of the rights of property on a reasonable and logical basis which it is possible to defend, and the importance of defending agricultural interests and the interests of agricultural land on grounds which it will be possible to defend.

6.36 p.m.

Mr. RHYS

I think that the whole House will be grateful to my Noble Friend for having placed the Debate upon a very high plane. I think the House can well afford to spend a little time discussing the very fundamental change in principle which is involved in this Measure. It has always been a principle of law that minerals below the surface belong to the surface owner. Times may change, and it may well be that in years to come it will be found necessary, for the benefit of the State, that minerals under the surface shall be nationalised. But I believe, when we have the opportunity that is afforded to-day of discussing this problem, it may well be taken, because there are a very large number of people who have a very pertinent interest in the matter. I think the House would be well advised to take note of the very frank statement of His Majesty's Opposition, who may well become His Majesty's Government in the course of a number of years, that they will regard this Measure as a first instalment of nationalisation. Nationalisation may be a good thing or a bad thing, but I think the House should also take note of the fact that His Majesty's Opposition, in frankly stating that they take this as a precedent, are being presented with the precedent of nationalisation of minerals without compensation. That seems to me a negation of official policy, which hitherto has always been that the State should not deprive one of its citizens, an individual of the State, of any property that he may possess without compensation. I think we should, indeed, pay some attention to that fundamental declaration. The declaration is to refer, I understand, to land as well.

A few months ago I had occasion to call upon one of my constituents, and he told be he had been running with Labour but now he was running away from it, because they were robbers. I was a little startled at this strong language and I inquired the reason. He said he had listened to Mrs. Sidney Webb on the wireless. She had recently been to Russia and she said Russia was a paradise because there were no landlords. My constituent owns one and a half acres of land with two houses upon it. I very much fear that Mrs. Sidney Webb has lost two votes for the Labour party. I only tell the story because the landlords to-day are not a few large ones, but a very large number of small ones and the House should think carefully before it assents to the principle of confiscation or nationalisation, without compensation, of the interests of a very large number of individuals. I hope to see the nationalisation of mining royalties on a reasonable scale with compensation, because I think it would remove a great deal of friction which at present exists, and I am not necessarily opposed to the State acquiring property from individuals, but I question very much the wisdom of laying down this principle of confiscation without compensation.

We are asked to agree to the Bill on two grounds, one that there is as yet no vested interest and, therefore, it is easy to acquire, and the other, that it will be practically impossible to apportion whatever oil there may be among the various owners. There are other minerals which at present are in the hands of the Crown. I do not know that there is any silver in England and I only know of two small gold mines, and they could not possibly afford any such complications as this Bill will introduce. It is said that oil is a fluid and is, therefore, in a different category from coal or stone, which is static. I do not think we ought to pin ourselves entirely to the fact that oil is a fluid. So is water, and I know of no law which prevents an individual from sinking a well on his land and drawing what water he requires. It is evident that he must be drawing water from underneath the land of a neighbouring owner. One of the greatest difficulties about mining is to keep water out.

But, suppose for a moment that the Government have made a case for the introduction of this Bill. I should like to have heard exactly what are the reasons that have stirred the Government into action. I make no attack when I say that but, when there are so many other things requiring the pressing attention of the Administration, and we are suddenly asked to deal with a Measure so fundamentally altering the conception of property, I think we might have had a little more explanation as to why it is necessary. If the Minister says that it is in the national interest, I do not want to press him any further, but when we are dealing with this great matter we ought to be told a little more about it.

No speaker has so far dealt with the actual provisions of the Bill apart from the one that vests oil in the Crown. I do not believe that the House in the least understands what it is being asked to do once the oil is nationalised. As I understand the Bill, the Board of Trade is going to have complete discretion to grant licences. There is to be no public information, no public notice, that the licence is being asked for. It is true that the Board of Trade have to lay regulations on the Table of this House describing how licences may be applied for, and that it is possible in due course for this House to alter the regulations, but there is no power to revoke any licence which is given in the meantime. That means that Parliament is parting with a very great deal of power. We may not always have the same President of the Board of Trade or the same Minister of Mines, and this House will have no control in certain circumstances of the licences that the Government may grant. I do not know whether hon. Members have such complete faith in a Government Department as to want to give them that power. We have gone a long way in this Parliament towards divesting ourselves of real control of policy. We allow Orders-in-Council to an unprecedented degree, and I feel that the moment has come when a halt may be called, or at least a protest registered about the increasing tendency on the part of the Governmnet to take over a new nationalised industry and to take such power to themselves that this House will no longer have any control over it.

I would like the Minister, when he replies, to deal also with this question of amenities. What is amenity? I believe it is almost undefinable. Any hon. Member who goes to Stonehenge and who has not seen it for a number of years will be horrified at the action of a Government Department in disfiguring Stonehenge and Salisbury Plain around. If ever it is proposed to build a gasworks or a row of houses which may spoil the view of Richmond Hill, in Surrey, there is an immediate outcry, even though that gasworks may be five miles away. I believe it is almost impossible to define amenities. Again, whether that is an assessable asset or a liability in computing compensation is almost impossible to say. The other great power which the Government are asking us to give them is what is described in one of the Clauses of the Bill as an ancillary right. That is the right to enter upon any land that they may desire, not, I would ask the House to notice, the actual land upon which the oil well may be drilled, but they take power to deal with the carrying away of the oil. As no inquiry is necessary beforehand, an owner of land two or three miles away from the well may suddenly find himself compelled to give access for pipe lines or whatever other method may be required, without having had any opportunity of making his own suggestions in the matter.

I do not want in the least to stop the granting of oil licences or to hold up the development of the oil industry, but when my right hon. Friend says that it would not be fair to those applying for licences to have any publicity in the matter, I venture to say that there are other people who have the right to expect some fairness, and those are the people who have interests in the neighbourhood. If it is not fair to one party, it equally is not fair to the other. Therefore, I hope some kind of modification will be made by which those interested in the neighbourhood may have an opportunity of putting their case. In this matter of compensation, I can readily conceive that perhaps it is inevitable—the march of time is such that these matters sink into comparative insignificance, but, after all, we in this House are here to represent the interests of all who live in the land—that as a result of action on the part of the Board of Trade the erection of pipe lines, engine houses, pumps, and so on may well diminish the value of, or even render entirely valueless, land and property which had a considerable value before.

I ought perhaps to have said earlier, when I spoke about houses and gasworks being only five miles away, that in the case of the Anglo-Persian oil works near Swansea, in a certain wind, you can smell them 20 miles away, and a very offensive smell it is too. It may well be that these projects may reduce very heavily the value of land, and if that is done by the arbitrary action of a Government Department, will any compensation be payable in. that connection? After all, a man may recently have spent very large sums upon a piece of land, and the State may immediately afterwards render that expenditure entirely nugatory. I do not go so far as my noble Friend the Member for West Derbyshire (Marquess of Hartington) in condemning the Bill out of hand, if a strong case for the public interest can be made. The march of time may be such that it is inevitable, but we must be very clear what it is that we are assenting to, and I hope the hon. Gentleman, when he replies, will make some attempt to deal with the position in the Bill and tell us the answer to some of the questions that I have endeavoured to put to him.

6.52 p.m.

Mr. T. SMITH

The hon. and gallant Member for South Leicester (Captain Waterhouse) asked what Members would do in their constituencies in regard to this Bill. I think I can tell him right away. We believe that if there is any natural gas to be exploited, it can be exploited better under national control than it can if left in private hands, and from that angle we are supporting this Bill. The Debate has been very interesting, with regard to the merits of private as against public ownership, and when hon. Members talk about the Opposition quoting this as a precedent, I may say that I do not think this Bill will have any bearing at all upon future questions of nationalisation. I support this Bill entirely apart from that question. I think you will be driven by sheer economic necessity to nationalise your basic industries before long, apart altogether from this Bill.

The Noble Lord the Member for West Derbyshire (Marquess of Hartington) is a defender of the private ownership of mineral royalties, and I do not blame him—he has done very well out of it—but the point that seems to be missed in regard to our opposition to the private ownership of mineral wealth is this: It is not merely that £5,500,000 a year is taken from the industry, although, in our opinion, that is far too much, especially when you remember that in some pits there is a royalty of nearly 6d. per ton when the actual tonnage rate paid to the men at the coal face for getting the coal is equal to about 1s. per ton. But that is not the real case. The Secretary for Mines knows, or there is sufficient data in his Department to tell him, that tens of thousands of acres of good coal have been lost to this country through the private ownership of minerals. That fact has been brought out before repeated commissions. The Noble Lord knows that prior to 1923 the landowner had the absolute right to say whether his minerals should be worked or not, and it was only in 1923, when the Miners Facilities Bill passed through this House, under a Conservative Government, that some colliery companies obtained the right to go before the Railway and Canal Commission and obtain further coal to work which had been denied by the mineral royalty owners.

The hon. Member for Attercliffe (Mr. Pike) may be interested to know that in his constituency, in connection with the pit at which I worked for 22 years, there were scores of acres of good coal lost that can never be recovered, simply because some royalty owners absolutely refused to allow that colliery company to work them.

Mr. PIKE

Is it not the case that the mineral rights in that case were owned by the Ecclesiastical Commissioners?

Mr. SMITH

Not in the particular case that I quote. For the hon. Member's information, may I say to him that when the Mines Facilities Act was passed in 1923 the the royalties that that company was able to obtain as a result of that Act put 15 years life on that colliery. Therefore, we say that the private ownership of coal royalties has wasted tens of thousands of acres of good coal in this country that can never be recovered. The attitude of the hon. Members opposite appears to be that whatever happens to be underneath the earth belongs to the landowner. I wonder why they do not claim that the air ought to be taxed. I suppose it is simply because they have not been able to enclose it. But while the defenders of the private ownership of mineral wealth defend their own interests in season and out of season they believe in public ownership in some respects. They are quite prepared to have the Army and Navy kept up by the nation and to have the taxpayer provide all that is necessary in that direction, but when it comes to a question of the possibility of extracting money for nothing, they want private ownership.

In addition to that, experience has shown, and the Coal Mines Reorganisation Committee has stated clearly and definitely, that the private ownership of mineral wealth is stopping the reorganisation of the mining industry. Therefore, in a word, our position is that we do not believe that this will bring in the millennium, we do not believe you will make any material difference to the coal mining industry one way or the other by this Bill, but we believe that if there is petroleum to be exploited, it can be better exploited under public control than in the hands of private owners; and because we believe in that principle, we shall assent to the Second Reading of this Bill.

6.57 p.m.

Viscount WOLMER

I can certainly join with my hon. Friends in opposing this Bill because of the very fundamental questions that it raises. We have only to listen to the speech of the hon. Member for Normanton (Mr. T. Smith), who has just sat down, to realise the sort of thing that is going to be said all over the country about the Bill. I would remind my hon. Friend that he started off by saying that he thought the Bill had nothing to do with the question of coal, but he devoted the greater part of his remarks to coal.

Mr. T. SMITH

I said that the passing of the Bill had no relation at all to the question of nationalisation.

Viscount WOLMER

Yes, and then my hon. Friend went on to argue in favour of the nationalisation of coal. I merely mention the matter to show that you cannot possibly deal with this question of private property in petroleum as if it were a mineral quite apart and by itself, and as if the same question of equity, the same right of private property, did not obtain in petroleum as obtains in all other minerals in this country, except gold and silver, which exist here only in minute quantities. However, what brought me to my feet was the speech of my Noble Friend the Member for Hastings (Lord E. Percy), who, with his extraordinarily ingenious mind, developed a new theory which, to his satisfaction, differentiated the case of petroleum from that of coal. My Noble Friend said that our ancestors were wise in upholding private property in minerals, because in those days all landlords were big landlords, and the big landlords were not only the best developers of coal mines, but they were also the best guardians of the amenities of the countryside, and, therefore, purely as a question of national policy, private ownership in minerals in those days was to be commended. It seem" to me that, on my Noble Friend's own showing, the disappearance of the big landlord destroys the case for private ownership in minerals altogether. There is not the slightest doubt that the introduction of this Bill is going to be hailed by the Socialist party throughout the length and breadth of the country as an abandonment by the Conservative party of the principle of private owner ship in minerals. That is injurious not only to the reputation of the Conservative party, but to the whole State, because I believe that respect for private property is one of the essential fundamentals to confidence in this country, and to activity in trade.

Once you do anything that shakes the faith of the public that Parliament will respect what have hitherto been regarded as the rights of property, you undermine all business initiative. I know my hon. Friends say: "How can you be injuring private property when people do not know whether they have got the oil under their land or not?" That is the argument that has been used by the Government both in this House and in another place. Lord Londonderry, of all people in the world, speaking in another place, suggested that there was no unfairness in the State confiscating, or rather declaring its ownership of oil which has not yet been discovered, because there was no person or section of persons who could say: "This is my oil." It was not known to be there, and because they could not claim it there was no hardship or injustice in taking it away. On similar arguments to that, you could really undermine the whole theory of private property, and I agree with my Noble Friend the Member for West Derbyshire (Marquess of Hartington) that it is a great mistake to think you could make one radical departure of this nature without having a profound effect on public opinion in regard to all questions of private property.

Lord Londonderry's argument reminded me very much of an argument from Mr. Philip Snowden, as he then was. Twenty- five years ago when his views were very different from what they are to-day, I remember him coming down to the Oxford Union and saying he could nationalise all property in this country without any compensation and without doing any injustice to anybody by a very simple expedient, which was to pass an Act of Parliament to say that nobody born after the passing of the Act would inherent any property. He argued very plausibly that the unborn could not possibly have any grievance against Parliament and you could not do an injustice to people who did not exist. Therefore, you could nationalise all property without inflicting an injury on any one person. That is very much like the argument that you are not attacking private property by declaring State ownership of petroleum, because all the supplies of petroleum have not yet been discovered. I do not believe you can declare it is equitable for the State to enter on petroleum in other people's land without profoundly affecting the whole public opinion in regard to the equity of owning property at all, and it is because I have always regarded the Conservative party as a bulwark in favour of the maintenance of private property against the Socialist party who have risen up to challenge that principle that I am distressed to see the Conservative party being asked and induced once more to throw its principles to the wind on some one particular case which the Government have brought forward.

I was profoundly impressed by the speech of my Noble Friend the Member for West Derbyshire, who has great technical knowledge in this matter, and I do think that case wants answering. I do not think, if I may so with all respect, that the speech of the Noble Lord the Member for Hastings was any adequate answer at all. It is perfectly true that petroleum has to be mined and the winning of petroleum must be governed by technical considerations. My Noble Friend may be right in saying that the present Act is imperfect, but there could be an arrangement by which once the oil was located it could be arbitrated upon with expert advice. The owners of the property in that area could share in the royalties to be derived from the extraction of the oil, and it could be governed by an arbitrator's decision. The technical case could easily be answered in a manner of that sort, and it is no answer to the Noble Lord the Member for West Derbyshire to say that, because you have got to take the oilfield as a whole, it is impossible to pay compensation to the many different owners of the surface ground. I think the owners of the surface ground will have the very greatest cause for complaint if the oil is taken from under their property and the whole of their countryside is disfigured and they have no share in the prosperity that results.

They may get compensation and the Bill tries to arrange that they should have it for loss of amenities. Everybody knows that is an extraordinarily difficult thing. When the wealth is being taken from their property and their homes are being made unpleasant as a result of industrial development, it seems to me most unjust that they should have no share in the prosperity. I would like to say something on the question of publicity, and I think that is a matter which has not received attention from the House. I am not going to make any charge against the President of the Board of Trade or any of his advisers. We know perfectly well we have far and away the most honest and upright Civil Service in the world. I believe one of the reasons, though not the only one, that is so, is that Parliament in the past has taken great care that everything should be done in the light of day. When you are dealing with a matter in which millions of pounds may be involved, when there are great powerful corporations interested, it does seem to me to be extraordinarily dangerous that these licences should be granted, or rather withheld, and these negotiations should be conducted and decisions made entirely secretly. Just contrast the policy of the Government in this respect with their marketing policy of which I am a strong supporter. If I want to get a monopoly of selling hops or black currants or any other agricultural product, which is what the Marketing Act confers, there have to be inquiries and notices which extend the period in which everybody concerned has notice to nine months. You cannot get a marketing scheme through in less time, and at every turn there are, very appropriately and rightly, opportunities for everything to be examined publicly and for interested people to be heard. I am glad to say a great many of these provisions were inserted when the Conservative party were in opposition and the Socialist party in office, because the Conservative party were then prepared to agitate in favour of these safeguards.

It is going to be far easier to get an oil monopoly than it is to get a marketing scheme through, and it does seem to me to be very dangerous and wrong that these things should be done without there being a public inquiry. After all, if you are going to treat this as a question of public policy, as it must be treated, in a democratic country or in any country, the only safeguard you have against scandals creeping in, is that these things should be done in the light of day. I should like to hear from my right hon. Friends what the objection is to a public inquiry.

On the question of amenities, I should like the House to realise that if the Crown is to have a monopoly of the oil, no local authority, no private individual will ever be able to bring a case against the Crown if it commits an atrocity against the amenities of any district. Just consider; we have an example in the case of Carlton House Terrace. I do not wish to suggest that I entirely agree with those who agitated against the decision of the Office of Works in that matter, but how much change did they get? It is impossible to influence a Government department in a matter of that sort. They simply snap their fingers at you. Look at Regent Street. No private owner would have dared to treat its tenants as the Crown treated its tenants, and, if the Duke of Westminster had been guilty of such conduct, every radical orator in the country would have stood on a soap box wherever there was room for him to stand.

A Crown monopoly is a most dangerous thing to the liberties of the subject, if he happens to be in a small minority. The people of England, as a whole, will not tolerate general oppression and dictation from Whitehall, but they are frequently very unsympathetic when the oppression falls on a few selected individuals, and that again is a matter in which I think the Bill is seriously faulty. Therefore, this Bill is not one that I can support. If the existing Act is unworkable and should, for technical reasons, be amended, let the Government come forward and say so, and explain why. That is no reason why we should establish the principle that the State has the right to confiscate minerals under the soil without compensation.

I think it is deplorable that the Conservative party, in defiance of its principles and traditions, should be lending itself to such a policy. I think it is a positive injury to our national life. At the present time our national life is suffering very severely from the public witnessing the Prime Minister agreeing to the abolition of the taxation of laud values, and the Lord President of the Council agreeing to the nationalisation of minerals. That is the sort of thing that confuses public opinion and leads to a belief that politicians are fundamentally dishonest, that they can stand for one thing all their lives and when they get into office they do the opposite. On every ground this Bill raises far greater issues than the President of the Board of Trade suggested, and I shall certainly join with my hon. Friends in opposition to it at every stage.

7.32 p.m.

Mr. HOLDSWORTH

The Noble Lord the Member for Aldershot (Viscount Wolmer) assured us that he is a Conservative. The Noble Lord the Member for Hastings (Lord E. Percy) assured us that he is not a Conservative but a Tory. I had always thought that Conservatism was enlightened Toryism, but I preferred the speech of the Tory to-day to the one to which I have just listened. I want to compliment the President of the Board of Trade on the introduction of the Bill, I look upon it as good Liberal policy. It takes for the State that to which it is entitled. It does not allow to the individual something he has never created and to which he has never had any claim. By a system of licensing it allows development by private enterprise, when the State has given its authority.

Many complaints have been made about the speech of my right hon. Friend in introducing the Bill. The hon. and gallant Member for Leicester South (Captain Waterhouse) complained that the speech was too brief. I thought that it was perfectly concise. The hon. and gallant Member also said that the speech was not clear. To me it was perfectly clear. I have no complaint to make upon those grounds. Whatever may be said about the right hon. Gentleman not being clear as to why he introduced the Bill, the opponents of the Measure have made their position perfectly clear. Their position is that the system which I have always looked upon as being wrong in principle, that is to say, the private ownership of royalties so far as minerals are concerned, is right. Their contention is that that system should be perpetuated in this Bill and that they should be compensated for something which they do not know as yet exists. No one knows whether we are going to get petroleum in large or small quantities, or at all. If we do secure petroleum, the opponents of the Bill say: "We will take the profits to be derived from it." The hon. Member for Guildford (Mr. Rhys) referred to the principle of compensation for rights. I cannot see what right there can be in something that does not exist, so far as we know. Hon. Members talk about confiscation. Confiscation of what? Is there any landlord who would suggest that any kind of estimate was made, any sort of calculation made in the price that he paid for any land he now holds, because there might be some petroleum underneath it? That would never he contended by any Member of this House.

I should like to deal with the speech of the Noble Lord the Member for Derbyshire, West (Marquess of Hartington). He opposed the Bill on three grounds. His first ground was that it was wrong and bad in principle, and that it was a return to Royal monopolies. He spoke of the fifteenth century and of certain things that Queen Elizabeth gave up and took back to herself afterwards. He said that the right of Royal monopoly was finally done away with in 1660, and that by returning to it in this Bill We were putting the clock back for 3O0 years. Listening to the speech of the Noble Lord, I thought that I was listening to a voice 300 years old. Does the Noble Lord suggest that the State will use this power that is asked to be given to it in this Bill in the same way as the Royal monopolies were used 300 years ago? Surely, there has been a great development since that time. There can be no suggestion that the State will use this particular power to further the ends of any particular individuals, as was done 300 years ago. There can be no valid objection on that ground.

The Noble Lord's second objection was that the ownership of land would be made less attractive. I wonder why? Later on he explained Why. He said that in America those who held land which yielded oil took one-sixth or one-eighth of the products. I could quite imagine that if any landlord has been looking forward to such compensation—compensation to which he is not entitled in justice or equity—and he is going to lose one-sixth or one-eighth of a product, it would be a very useful addition to his income if he could be given the same privilege which the American has got. It is obvious that there is no legitimate objection to the action of the Government in this matter. One can imagine that it would be a very attractive proposition if the landowner could get one barrel out of every six barrels of oil produced.

The Noble Lord's third objection was that the oil policy in the Bill was definitely wrong. I was at a loss to follow Ms argument. Ho gave us a learned and technical discourse about geological formations, which was very interesting, but it seemed to me not to be related to the Bill. I cannot see how the system that is suggested in the Bill for granting licences has anything to do with the Noble Lord's contention that the policy in the Bill is wrong. It seems to me that it will be perfectly open to a person who receives a licence to develop a particular undertaking in the most scientific way possible. How the Bill affects that particular matter I fail to understand. The Noble Lord also attacked the Bill on the ground that it would make the ownership of land more onerous. That was a very interesting statement, but I heard no argument to prove it. It is all very well to come to the House and try to frighten everybody without proving his contention. I do not think there is a single owner of land in this House or in the country who would seriously put up the argument that because of this Bill the ownership of their land is to become more onerous. Is there any landlord in the country who ever expected any results from petroleum on his land? The Noble Lord also argued that it was essential for people to put their money into land. I do not think anyone would dispute that. How this Bill prevents that from being done I fail to see. The speech—a speech, if I may say so with respect, well delivered —was as to nine-tenths of it unrelated to the Bill.

There was one statement of the President of the Board of Trade in introducing the Bill with which I disagree. He said that this Bill was not an important political step but an important economic step. It is also an important political step, and in that sense I agree with those who are opposing the Bill. If there is to be development of an industry like the petroleum industry, surely hon. Members opposite are not prepared to see repeated the kind of struggle that has been going on for all these years in the coal mining industry. Every report that has been given on that industry has condemned the private ownership of mineral rights. If we are to have a new industry do not let us create a private vested interest that might develop in such a way that the new industry would suffer as the coal mining industry has suffered. There was one omission that I noted in the speech of my right hon. Friend, and that was that no reference was made to natural gas. I am not an expert and I do not know anything about the discovery of natural gas in this country—

The SECRETARY for MINES (Mr. Ernest Brown)

It is covered in the Bill.

Mr. HOLDSWORTH

I know that it is covered in the Bill, but the right hon. Gentleman made no reference to it in his speech. [Interruption.] The hon. Member opposite is the last man in the world to talk about possessing natural gas. Let him sit quiet on that subject. It is interesting to note the results of discoveries in Vienna on this subject. A concession was granted to an American firm and they have tapped a remarkable source of natural gas which, I understand, would feed the whole of Vienna so far as gas is concerned. It is interesting to note the very cheap way in which it can be distributed by a few men simply by the manipulation of valves. After the first few hundred thousand pounds had been spent in boring, tremendous results can be got. I suggest to hon. Members opposite that that is due to geological formation and not to the efforts of individual landowners. The Government are entitled to say that if such a discovery were made here the State shall reap the reward from it.

I am sorry that the noble Lord the Member for Aldershot has left the House. He twitted us by saying that if certain events occurred we Radicals would go up and down the country making speeches. He has no complaint to make against the Government so far as regulations go. No person in this House has been more in favour of marketing schemes than the noble Lord. He is particularly attached to a certain marketing scheme, and, if a new scheme were to come before the House and we found that it created a monopoly for certain pig producers, he would be one of the biggest supporters of that particular scheme. Personally I thank the President of the Board of Trade for the introduction of the Bill. I have always had a very great admiration for his Liberalism. I used to follow him very faithfully indeed, and I am glad to see that even at this eleventh hour he has persuaded the Government to bring in one Measure to which Liberals can give the whole-hearted support.

7.31 p.m.

Mr. DAVID REID

I am sorry that on this occasion I find myself in opposition to the Noble Lord who moved the rejection of the Bill, and to a number of other hon. Members with whom I am usually in cordial agreement. I find myself supporting a Measure which is supported by the Front Bench opposite, and my main purpose in rising is to explain that I do not support the Bill for any reason which they or any hon. Member on that side of the House has suggested. My view is that there is no deep principle involved in the Bill. There is no scheme for the nationalisation of mining royalties or the nationalisation of anything else, in my opinion. One opponent of the Bill spoke of the ownership of minerals. Various hon. Members have talked of owning minerals as if a landowner had some specific grant of things called minerals. A man owns the surface of the land and the sub-soil, and if something called a mineral is found in the sub-soil he owns that. So far as I know the question of the ownership of petroleum has never yet arisen in England.

A good many years ago, before the passing of the Act of 1918, when certain firms and persons were prepared to test the resources of this country for getting petroleum, it happened that I was called in to advise them on a number of points, land they directed my attention to this question. I remember that I consulted a number of the American authorities, but they did not seem to throw much light on the subject, and I came to the conclusion, rightly or wrongly, that petroleum, being a fluid, in law holds much the same position as water or brine. Take the case of water. In this country anyone is at liberty to sink a well on his own property and to draw water from it, even though in doing so he is drawing the water away from his neighbour's land. There is no property in underground water or rather in percolating water. But there are parts of the country where the water found is of a peculiar value, for instance for brewing, and where prohibitive clauses against the sinking of wells or the drawing of water have in certain circumstances to be inserted. There is the still stronger case of brine. There is no doubt that brine is simply rock salt dissolved in water. Rock salt in a solid state is a mineral and belongs to the owner of the soil, but when water penetrates into the fissures and so on it can be brought to the surface in the form of brine. Petroleum is found in the soil, but it is fluid. I think the Noble Lord under-estimated the fluidity of petroleum. Hon. Members have stated from experience that petroleum might flow or percolate over a considerable area. It seems to me that the only right of property in anything which is worth having is a right of property which you can assert. You cannot possibly have that right in a substance which may flow on to your neighbour's land or under your neighbour's land, and which, when it does so, he is able to extract without being under any liability.

The law being as it is, and the substance being of that kind, there is no effective right of ownership in petroleum, in my opinion. What then is the wisest thing to do? In these circumstances if you want the mineral worked, or attempts made to work it, you must find some way by which some exclusive right can get into someone's hands. The best way is to vest the right of property in the Crown and for the Crown then to grant such rights for working as are required. No one is going to make a bore-hole at considerable expense knowing that if he strikes oil someone may put a bore-hole down on a piece of land close to him. Unless you have some restriction no person is likely to spend money in sinking wells, to find that if he is successful anyone else can sink a well close to him and compete with him. Therefore, some Measure of this nature is called for. But I think the Bill will require very careful consideration in Committee. There is here not only the right for searching and boring, all of which might not require very much land, but it goes on to refer to storing, treating, and converting petroleum, and so forth. In the case of these powers people should not only be compensated for land taken, but anyone whose land is injuriously affected should have compensation. That does not seem to be provided for in the Bill. But those are Committee matters.

7.42 p.m.

Captain PEAKE

We have listened to an exceptionally interesting Debate, in which experts on oil have vied with exponents of political theory. I was very much interested in the extraordinarily able speech of my Noble Friend the Member for West Derbyshire (Marquess of Hartington). I thought that he to some extent exposed a weak flank when he put forward what I might call the agricultural portion of his argument. Personally, I could not see that, because the State was taking away from a landowner a mineral oil lying 3,000 feet below the surface, the landowner was likely to put less manure upon the surface. I could see only a very remote connection between the two. But it struck me, as I listened to my Noble Friend, that possibly at the back of his mind there was the idea that some day some Government or other will follow up this present Measure by unifying the mineral ownership in coal, and it occurred to me that possibly my Noble Friend was not allowing this opportunity to go by to-day, so that he should not be precluded from substantiating a claim, and in my opinion a very just claim, to compensation, if ever such action should be taken.

With regard to the speech of the Seconder of the Amendment, my hon. Friend the Member for Aylesbury (Mr. M. Beaumont), I confess I was struck dumb by his versatility. He appeared before us last Thursday as a declared admirer of Fascism and the methods of Mussolini, with all in the way of sacrifice of individual rights that that creed involves. This afternoon he appears as the champion of an individualism which is positively Victorian. When I saw this Bill the first question I asked myself, as one interested in coal, was: Is the State justified in taking steps to develop oil in this country when we have such enormous deposits of coal? Upon reflection I came to the conclusion that there is a good deal that is complementary and not competitive as between the oil and the coal industries. We need large supplies of liquid petroleum in this country. It is true that it is chemically possible to produce these supplies from British coal, but it is a very, very long way from being economically possible, even with the very large preferences which our fiscal system gives to home produced oil; and it seems to me that it is probably a mistake to try to produce by synthetic methods what is, in effect, a natural product existing in great volume throughout the world. I do not believe that it is possible to produce it in that way on an economic basis, though at the same time it is right to give a preference to fuel produced at home. It seems to me that we shall never make a success of the primary production of petrol from coal without regard to the other fuels to be produced. The process which is most likely to be economic in this country is the production of oil from coal as a by-product, the main object being the production of smokeless or semi-solid fuel.

Having convinced myself that it was wise to try, both on the grounds of finding employment and of national safety, to develop the home oil industry—I inquired what was the present position. It is obvious that under the Petroleum Production Act, 1918, it is absolutely impossible to get any steps taken to encourage the production of oil to-day. The position of the licensee is one of very great doubt and difficulty. I had always imagined, and until this afternoon I had not thought it was possible to challenge the theory, that the owner of the surface was the owner of what lay under the surface also, and, therefore, that the oil belonged to the owner of the surface. My Noble Friend the Member for West Derbyshire has put forward the proposition, which rather startled me, that anybody was entitled to sink an oil well, and that the oil that came up the well, or was drawn up, was the property of the person upon whose land the well was Blink. I was surprised to hear him put forward that proposition. It may be the law, but, if so, it is a very curious state of affairs, because the Noble Lord bases his opposition to this Bill upon the principle that private property is sacred, whereas the proposition he advanced was that it is open to one landlord, by sinking a well, to pinch the oil belonging to a neighbouring landlord. When the Noble Lord talked of pinching oil, I thought to myself, "If I had any oil under my property I had much rather, on the whole, that it was pinched by the State than by my Noble Friend the Member for West Derbyshire."

The position of the licensee under that Act being one of very great doubt and difficulty, it is obvious that if there was to be any development the Government must take steps to clarify the position. When we consider what the Government ought to do, two great considerations arise. The first is that I do not think that public opinion to-day will stand for the sort of accidental personal enrichment which has taken place in days gone by through the exploitation of coal. I do not honestly think public opinion would stand for that to-day, yet if we were to declare for private ownership in mineral oil we should be giving a fresh impetus to that sort of accidental personal enrichment. The classic example of enrichment of that kind is the case of a North country landlord who derived a considerable fortune from the minerals under his property but, getting tired eventually of the sight of collieries and slag heaps and colliery villages, decided to invest a portion of his money in a part of England where, as he thought, he was never likely to see a colliery again. After considerable reflection he purchased a very nice property in the eastern part of Kent—and it was not 15 years before coal was being developed there‡ It is possible, to justify these incomes from royalties only upon the ground that any other system would be worse. I think my Noble Friend the Member for West Derbyshire would only seek to justify them on the ground that they are a necessary evil in the process of development.

The second consideration which appeals to me when I consider what course the Government ought to take is this: Most of us believe to-day that we ought to try to produce a greater degree of planned order in industry than has existed in the past. I myself, in a humble way, have been trying in West Yorkshire to obtain greater co-operation among the producers of coal there. Many schemes have been discussed, but it is not the stupidity or the recalcitrance of a few owners which is the principal obstacle to our schemes. The really great obstacle to any successful scheme is the principle of individual mineral ownership. I wonder whether hon. Members realise that it is not possible to close down a colliery—and there are a good many collieries which ought to be closed down—or even to abandon a seam in a colliery, unless you are prepared to pay compensation to the mineral owner. You can only close down a colliery if that colliery is hopelessly bankrupt and there is not any chance of the landlord getting anything in the winding-up; and even after the liquidation has taken place the landlord is free to develop his property again himself, upon his own lines, or to re-lease it, if he can, to a new tenant. It is upon obstacles of that kind that any attempt to control industry co-operatively breaks down. It may be that in the early stages of a developing industry there is as good development where the minerals are privately owned as where they are publicly owned, but when that industry is fully developed and in a static condition if there is diverse ownership of the minerals it is difficult to get any united action on the part of the tenants. In my opinion there was no alternative to the Government unifying the ownership of oil in the way they are doing under this Bill.

There is one point of doubt in my mind, as to the method which the Government are adopting. The Crown is to be the owner of these minerals, and the Board of Trade are going to exercise the functions of ownership. Ownership is a skilled business; the ownership of minerals is a special skilled business, in my opinion. I wonder whether the Board of Trade have ever owned anything before. Do they know anything about ownership? Is there anybody in the Board of Trade, except my right hon. Friend the President, who knows anything about ownership? I think there is something to be said for setting up a national fuel commission of experts charged with the duty and the responsibility of ownership. Apart from experience ill ownership we need to have continuity of policy, and the Ministers of Mines and the Presidents of the Board of Trade whom we have had over the last few years have certainly not been of the same complexion. There is a great deal to be said for an Amendment of the Bill to set up a commission to discharge the functions of ownership, which are vital and very responsible. If we had such a commission, when the next great step is taken, and by the next great step I mean the unification of the coal deposits of this country, we should have in existence a commission with some experience who could give their whole time and attention to the very important problems which the ownership of mineral deposits raises.

In conclusion, we have heard a good deal of political theory this afternoon, a lot about Socialist principles. Liberal principles and Conservative principles. I do not think the country is very much interested in what we all think of the principles of our respective parties. We were sent here as a Government to deal with practical problems, and to deal with them in a practical way. The Government are tackling this problem in a practical way, and I wish them God speed with their Bill.

7.57 p.m.

Mr. GEORGE BALFOUR

I do not propose in my few remarks to traverse the ground which has been so well and ably covered by my hon. Friends in this House who think as I do upon this subject; nor do I desire to take this opportunity of exposing what has been already admitted, and that is the unadulterated Socialism upon which this Bill rests. We listened to a speech from the Opposition Front bench in support of the Bill which might well have been made from the Treasury Bench. I content myself with whole-heartedly supporting what my Noble Friend the Member for West Derbyshire (Marquess of Hartington) said, but I wish to raise an issue which has not so far been touched upon in this Debate, but which I think is of serious consequence. In my opinion, this Bill represents a considerable departure from Parliamentary practice. For the first time in such an important matter there is a proposal to set up a new method of granting concessions. It is true that the word "licence" is used in the Bill, but, in fact, we must read for the word "licence" the word "concession," because that is what is meant. We are considering to-day a machine for the granting of concessions, and very important concessions affecting the whole territory of Britain, and we find that the Board of Trade, a Department which I naturally hold in the highest esteem and respect, and which I am sure would never be suspect of anything favouring in the least of corruption, have thrust upon them the duty, and I think the unfair duty, of granting a concession after, presumably, the only means they can take, a private discussion with the prospective concessionaires.

Following upon these discussions with the Board of Trade a concession is granted. Then, for the first time in these proceedings, does a proprietor learn that his rights, either as regards his property or his liberty, are affected. At that stage a "Gazette" notice has to appear intimating the grant of the concession. Up to that moment, although his rights are seriously affected, the proprietor is not conscious of any raid either upon his property or his liberty. That, I think, marks this as a serious departure in Parliamentary practice. No doubt my hon. Friend the Secretary for Mines when he replies will say that this is a matter of pressing importance and a matter which brooks no delay. He will say "These concessionaires come to us in secret, not for any corrupt purpose but because it is necessary that nothing should be disclosed to the public." But what have they to disclose? They come to seek the grant of a concession in exactly the same manner as any other concessionaire. I could follow up this argument by showing the various effects which this procedure will have upon private property rights and individual liberty, but that aspect of the question has been well covered already.

Let us assume that under the 1918 Act sufficient interest was not being taken in this matter and concessionaires were not coming forward. What is the remedy? Let it be known that the Government will welcome applications for concessions by the ordinary method of giving notice in the "Gazette" that a concession is desired to search for and to work oil in certain places. Then all the parties who are directly affected or those who believe themselves to be affected, can take the ordinary measures of protection by lodging objections to any concession. Probably some of those objections would be frivolous, but a large number would be serious, and, on the hearing of those objections, protective conditions would be inserted in the Measure before it left the committee of investigation. It is alleged that this is an expensive method and would occupy a long time.

I suppose that of all the Members of this House or indeed of all the people of this country, I should be the last to propose the method of Provisional Order or Private Bill procedure. The companies with which I am associated, must have promoted scores of Private Bills or Provisional Orders. I have suffered by having to go through these formalities, and I know the difficulties and the expense and time involved. Only a few years ago after an expenditure of over £50,000 in an important promotion by a company with which I was associated the powers sought were not granted. I felt that we would succeed, but we failed. I make no complaint of that, however, and I have no right as a concessionaire to say that my interest must be regarded as a prior right coming before the rights of individual property and individual liberty. As long as we adhere to the established practice of Parliament, all citizens have an opportunity of considering the matter and of petitioning against any infringement of their rights. The moment we depart from that practice we are taking a wrong course. I would impress upon the President of the Board of Trade and the Secretary for Mines that this is no frivolous debating argument. It is one which I would rather not make, because, for my own personal reasons, it would suit me very well and suit the companies with which I am associated, to know that we could arrange for the grant of concessions here and there without all the tortuous procedure and the expenditure of time and trouble involved in the other method of procedure.

I think I have made a case to show that hon. and right hon. Gentlemen should think seriously and long before deciding that a National Government, supported in this House by, I think, 470 Conservative Members, should make such a break with Parliamentary tradition and Parliamentary practice. While a National Government is in being, they would do well to pledge themselves not to take any action which would impinge upon the principles of the greatest section of political thought among those in the country from whom they draw support. I do not press that argument, however. It is merely an ancillary argument which touches one personally as a Member of the House. But I would beg the President of the Board of Trade and the Secretary for Mines to reconsider their decision and to introduce a simple Bill extending the provisions of the 1918 Act if necessary, but in no circumstances giving absolute concession rights, without ensuring to all the protection of that procedure which the House has so long followed and justified.

8.7 p.m.

Captain HUNTER

I think one must visualise this Bill, whatever one may think about it, with a view to the possibility of there being a large or an appreciable supply of oil in this country. That may be only a possibility, or it may be a probability. But it does not require a great deal of argument to emphasise the importance of oil in quantities to this country. There are two most important aspects of the question. One is the financial importance of oil, if indeed it is to be found in this country, and the other is its military or defensive importance. As regards the financial side of the question we are at this moment expending a very large amount of money in payment for the oil which it is necessary for us to have. That expenditure, I believe, verges on an annual payment of £30,000,000 and any obviation of that large payment, or even portion of it, would be of the utmost value in relation to our balance of trade. When one looks at the question also from the point of view of our relations with foreign countries one recognises still further its great importance. We are bound to have these oil supplies; we are also bound to pay for them and therefore, we are bound to countenance agreements with other countries which we might possibly not accept were our hands untied.

Even more important than these considerations is the military or defensive aspect. Our naval, military and air forces to-day are highly mechanised. Practically the whole of our forces would be rendered almost immobile if we had not an adequate supply of oil. Our imports of oil are drawn in about equal quantities, on the one side from the Western area, that is the United States and on the other side, from the East. In the event of war we are confronted with the danger of our Eastern supply being cut off at the source. We are also faced with the difficulty of transport from the West in view of possible enemy action. It must, therefore, appear that if indeed there is a supply of oil in this country we are bound, in the interest of the nation, to deal with that supply by the best and most efficient methods which we can devise. Were boring for oil in this country to be undertaken in a haphazard way we would have a situation analogous to that which arose in the United States in earlier years. There would be far-reaching results of an undesirable nature, there would be no control as to the output of oil and no provision for a national reserve in case of emergency.

I agree at once, therefore, that national control over any oil obtained in this country is essential, and that being the case I would welcome this Bill wholeheartedly if I had any reason to suppose that it was an emergency or temporary Measure. I have no reason to suppose anything of the kind and when I look at this Bill as a Measure which is intended to control a possibly large oil supply in this country I must confess that I am filled with misgivings and alarm. In my view it does not go far enough and is not adequate. There are several objections to this Bill. The Government are to exercise control through the medium of the Mines Department. I can conceive circumstances in which for reasons of foreign policy, the Government under this Bill might be obliged, either by the pressure of a foreign country or through the exigencies of international finance, or the expediency of the moment, to take action which might not be in the national interest. The rights of the private individual are very largely ignored, which is a great mistake. In this matter, I place the private individual a long way behind the nation, but he cannot and ought not to be ignored. It is a moot point legally whether the individual owner has actually any ownership in petrol, but at least he may have a right, which I do not think can altogether be ignored. Another point of objection is that in the circumstances that I have visualised it would be necessary to create a national reserve of oil, which is not as far as I know, provided for in any way.

No restrictions are made for prohibiting the participation of foreign capital or for ensuring that none but British nationals are eligible to apply for licences to drill for oil. All those points are matters which the Bill ought to cover adequately, and I cannot say at the moment that that is the case. There is one suggestion which I advocate wholeheartedly and which, I believe, is on the right lines. I do not think that an asset of this importance to the country ought to be under the control of any Government of the day, not because I have any imputation against either this, or any other Government of the past, but because there are certain things, and this is one of them, which are a great deal better under non-political control. The whole operation and control of the boring for oil in this country ought to be in the hands of a national trust composed of men drawn from all sources whose only qualification should be that individually they had the confidence of the country as a whole. They should be assisted by as much expert advice as they feel is necessary, and their functions should be to regulate the licences issued, to secure that the terms of the licences are fulfilled to the uttermost, to ensure that over production does not take place, and to enforce provisions for an adequate national reserve of oil, upon which I place a great deal of importance.

By those means, I believe that it would be possible to make fair provisions for the individual landowner concerned, because under the scheme I have visualised I have made apparent the participation of landowners under the trust, which might be summarised under the following general principles. The whole boring areas should be divided under expert advice into units and allocated to each individual whose land lay within the unit in proportion to the acreage he possessed, whether there was or was not a bore hole on his property. The expenses should be provided first, by the licences of the land, and secondly, by the natural oil obtained by developing the individual group. Out of the sums received from this source, 51 per cent. should be paid to the Exchequer by the national trust and 49 per cent. divided among the various landowners on the basis I have indicated. I hope that the House may hear, when the Minister winds up the Debate, that consideration of these points will be given by the Government. I believe them to be in certain circumstances extremely important, and, as the Bill stands, I shall support it on Second reading, only with a good deal of hesitation and reluctance. I should like to add my plea to that made by hon. Members earlier in the Debate for an inquiry into the why and the wherefore of the Whole matter.

8.22 p.m.

Mr. WISE

I rise rather at a loss as to which side of the House in future is to rest my weary body, always having imagined that I was a Member of the Conservative party which had a considerable majority in this House, even though it was supporting a unified Government, but when I hear a Measure moved by the right hon. Gentleman the President of the Board of Trade received with thunderous applause by the Socialist and the Liberal parties, and in solemn silence by the majority of his own—[An HON. MEMBER: "No."] I hear an hon. Member say "No." I did not at the time hear his voice uplifted in enthusiastic applause, but I must have missed its delicate tone among the harsher notes of the supporters of my point of view here. I would suggest that no ground has as yet been advanced in this House as to why we should accept this Bill unless we accept with it the logical implications which were correctly pointed out by the hon. Member for Gower (Mr. D. Grenfell), that if you nationalise oil supplies, why not nationalise everything else?

The only logical support of the Bill has come from hon. Members of the Socialist party. They at least are not departing from principles which they have always preached and consistently supported. In spite of the fact that the hon. and gallant Member for North Leeds (Captain Peake), who, I am sorry to say, has left the Chamber, told the House that one of the first duties of an efficient Government would be to put their principles into the wastepaper basket and work by expediency, I still think that the only logical support of this Bill can come from hon. Members opposite. Naturally, nobody expects logicality on anything from the Liberal party, which, as usual, is absent. The only thing we can gather from their speeches is that that group of peripatetic philosophers are ready for another move, and that they will be able to cross the narrow Gangway which separates them from their masters in the last Parliament. Whether they will be welcomed or not is not for me to discuss, but I am sure that it will be no great strain to them to make this move.

What are the points advanced in support of this Bill? The first is that there is very little oil boring done in this country. That is perfectly true; but where, until quite recently, was the incentive to do anything? Until recently there was no question of a protective duty on oil supplies, and up to quite recent times the demand for oil was much smaller. There has been a large increase in the number of motor cars using oil and the increased use of oil for fuel and other purposes has been equally large. If anyone believes in private enterprise, then it is a perfectly natural consequence to say that if there is any oil to be got it will be got in the ordinary way without this form of State interference. It has been suggested that there is no harm in removing from a man that which he does not yet know he possesses. That is not a valid argument. It is true that the owner of land may not know that he has oil underneath it; the owner of agricultural land in Middlesex did not know that the Great West Road was to be built through his land, but his increment is just as much unearned as that of the owner of oil. If you are logical, then, if you confiscate the oil, you must confiscate the increment.

Again, therefore, in logic, the only support of this Bill can come from hon. Members opposite. I cannot see why those who have consistently proclaimed that they support the right of the owner of property to increment which has accrued not because of his efforts but because it is his property can depart from that principle now. It is not a bad principle. I think it is a good principle. I only wish I had had the good fortune to purchase property on the site of an arterial road. Another reason advanced in favour of the Bill was that it only created one new precedent, as if that in itself was an excuse. In other words, after coquetting with Socialism the right hon. Gentleman has pro- duced one illegitimate child. What did he think we expected him to produce? Did he think we expected him to produce triplets and nationalise two other industries as well as this? Might I suggest that this one unwanted bantling is large enough and ugly enough to take the place of many lesser ills. It is not only confiscation which we are being asked to support to-night but confiscation without compensation.

Mr. RADFORD

Might I ask the hon. Member how it would be possible for any landowner who found that there was oil below his land and tapped it to know that he was drawing his oil and not oil from land of an adjoining landowner?

Mr. WISE

The hon. Member has raised a point which was ably dealt with by the hon. Member for West Derbyshire (Marquess of Hartington), that the supplies of oil are in fact localised. The principle in law is that where oil is found where the shaft is sunk it is the property of the person on whose land the shaft is sunk. That is the common law. We were informed by the President of the Board of Trade that the reason for the introduction of this Bill was the unsatisfactory state of the law that it was quite unfair that one man should have the sole benefit of oil under his property when it might belong to someone else. The Government cannot have it both ways. They cannot say that it is the law. and that it is not the law.

I want to point out the dangers or this unfortunate method. If I were a Member of the party opposite, I should welcome the Bill as they did, and I hope that I should be as frank as they have been, and not be tempted to stoop to cunning, and adopt the arguments of the Government, that after all it was only one little thing which had never been done before except in the reign of King John, when gold and silver were reserved as Crown property. The conditions in King John's time were a little different from those of to-day. In those days property was extremely bady defined, it was difficult to know "whose property was which," and, therefore, a Measure by the Crown was equivalent to what we do in our own Colonies to-day, that is, reserve Crown rights on undeveloped land, on savage land, a very different thing from annexing a man's property. I hope the House will record its emphatic protest against this principle. The Conservative party is attacked now, unfortunately, on many sides. It is in the position of a dying Caesar. Having first been stabbed by an envious Casca and his 99 associates in a manifesto, he turns and finds his favourite adopted son, the President of the Board of Trade, and looking at this new Brutus, he can only say, "You, even you, my son," and then fall dead at the foot of Gladstone's statue.

8.34 p.m.

Lord WILLOUGHBY de ERESBY

When I came to the House this afternoon I did not intend to speak, and I can assure hon. Members that I will not detain them very long. I realise only too well that it is extremely dangerous for anyone as inexperienced as myself to launch forth at any great length without adequate preparation and before having a complete understanding of the Bill. My only excuse for intervening in this Debate is that the President of the Board of Trade made a reference in his speech to what might be the consequences of oil being found in Rutland. My family happen to own land in Rutland, and I began to sit up and take notice and wonder what would be the consequence if oil were found there. When members of my family buy or sell land in Rutland, we do so, as the relatives of my family have always done in the past, on the understanding, with the possible exception of gold or silver, that everything above the land as far as heaven and everything below the land as far as hell belongs to us as rightful owners and lawful possessors of the land.

It is true that on two occasions minerals have been found on our property, of which I have no doubt my ancestors were blissfully not aware at the time of the purchase. In one case, I do not hesitate to say that we are richer to-day from royalties having been paid owing to the discovery and working of those minerals. In the other case we would undoubtedly have been better off to-day if those minerals had been discovered subject to the provisions of the present Bill. Considerable damage has been done to the property, the amount paid in royalties is negligible, and there does not seem to be any hope of any further compensation being acquired from the destruction of the property. In the one ease we have been winners, and in the other we have been losers, so I think we are now all square.

I feel, as a landowner in Rutland, that I might possibly be allowed to look upon this question from an uninfluenced point of view. I have come to the opinion that it is in the interests of the country that in the development of petroleum and the working for petroleum the State should have some concern, and that unregulated and unrestricted control is not in the best interests of the nation or the countryside as a whole. As a landowner, I am prepared to hold my land under the conditions laid down in this Bill.

There is one point which is a matter of some concern to me, and it is my real reason for rising now. I would like to have some assurance from the Government that adequate compensation will be given to owners of property adjacent to land on which oil has been discovered. Inquiries into past experience in other countries show that large tracts of country stretching very often 20 to 30 miles are seriously affected by oil works and also rendered in many cases completely unhabitable. A very near relative of mine raised the question in another place, and the substance of the answer which he received was that a man with his legal knowledge should know the answer. Since then, with the assistance of my near relative, I have looked up the Common Law of this country. We are still not thoroughly satisfied that the compensation which can he obtained by the owners of adjacent and surrounding property will be proportionate to the amount of damage which may be done—damage not only of a material value, but, what is equally important in many cases, of a sentimental value. I would ask the Minister who replies to give some assurance that this aspect of the question will be fairly and justly treated.

8.39 p.m.

Sir NAIRNE STEWART SANDEMAN

I would like to beg the powers-that-be to send this Bill to a Select Committee upstairs. The Noble Lord the Member for West Derbyshire (Marquess of Hartington) made a speech which held the whole House, and it proved to me that the rest of us do not know very much about it and that it is a question that should really be closely inquired into. The Noble Lord was temperate; he did not try to overstate his case. He was listened to with that attention which proved that few of us, not even my hon. Friends on the Labour benches, knew much about oil wells. I have only seen oil wells in Rumania, and I must say they were not a beauty spot on the countryside. I am told by the Minister for Mines that the modern way of extracting oil is just as beautiful as the pylons all over the countryside. I would very much like to know what the town planning authorities will say about it if there is a chance of oil being found in a place like the Isle of Wight. What is the law on that subject? I would also like to know why this Bill is brought in at all. I have heard from a pretty good source that there is no oil in this country worth speaking of. Why, then, stir up the Conservative bee-hive by introducing this Bill?

Mr. GROVES

To pour the oil on troubled waters.

Sir N. STEWART SANDEMAN

You have to get the oil before you can pour it on troubled waters. Why introduce this Bill now? It makes us wonder what is behind it all. We have heard of vested interests and that somebody is going to get these oil rights. Is it not possible for the Minister to give us a wrinkle as to why the Bill is introduced? I do not suppose it will throw oil shares up a great deal if it is known that a great deal of money is to be spent in looking for oil which most of us do not believe exists. Why cannot the Minister take us into his confidence a little bit more and still that Conservative conscience which feels that the country is being rather led up the avenue. The best way to do that is to send the Bill to a Committee upstairs where it can be inquired into. If it does not go through by the end of the Session, the Government can always bring it in again, and they can then bring in a clean horse which will run with a good chance instead of this rather suspect animal.

8.43 p.m.

Mr. MOLSON

The hon. Member for Middleton and Prestwich (Sir N. Stewart Sandeman) has reverted to the allegation made by a number of hon. Members that there is something mysterious and inexplicable in the origin of this Bill. We have been told clearly what is the reason for the introduction of the Bill. After a number of years in which nobody has taken great interest in the possibility of finding oil in this country, interest has again been aroused. That is a Parliamentary way of saying that after this Bill has been passed there is some likelihood of a survey being made in this country by some oil interests with a view to proving whether there is oil here or not.

Sir N. STEWART SANDEMAN

If you take the analogy of gold, that is, of course, a Crown monopoly which nobody can mine except the Government. There is gold in this country, and nothing is done.

Mr. MOLSON

I do not quite follow the relevance of that interruption. Gold is the property of the Crown, but, if that were not the case and there were a prospect of a gold rush, it is possible that a Bill similar to this Measure would be introduced to deal with gold. One hon. Member suggested that the Bill has been introduced because the President of the Board of Trade and the Minister for Mines wish to demonstrate the fact that they are still Liberals. If the President of the Board of Trade has one merit more than another—and I think the has nearly all the merits—it is that he appears to approach all matters from a purely practical point of view. Of that we can be assured. I have heard from another source that there is a certain oil company which would be willing to carry out the survey, if there were any prospect, after oil has been discovered, of a concession being given on workable conditions.

It has been made plain by the right hon. Gentleman's speech that the present state of the law is extremely unsatisfactory. It is unsatisfactory for two principal reasons. First, although it is necessary for anyone who wishes to bore for oil to obtain a licence from the Board of Trade, he has after that to negotiate with each owner of land; and, secondly, he has no power to go to the Railway and Canal Commission in order to obtain those easements, surface rights and so on, which are necessary for the development of an oil concession. Those are, we have been told, the reasons why the Bill is being introduced. The present law also suffers from one great dis- advantage which I should have thought would appeal to Members of the Conservative party. Under the present law a licence is only given to one individual for the opening of a well upon a certain piece of land, and, if in the area of that licence there are other landowners, all the royalties accrue to the owner of the land where the well happens to be.

In the Debate, which has been extremely controversial, all speakers have agreed that, if oil is to be developed in this country, there must be centralised control, and that, whatever may be the size of a deposit of oil, that deposit must be developed in the most economical and scientific manner possible. It is because that has been agreed by all speakers that I hope the Bill will receive in Committee greater support than it has received so far.

I may perhaps be allowed to contrast two oilfields which I have seen. I have seen the oilfield of Burma. There, in the case of about one square mile, in the middle of the area which is being developed by the Burma Oil Company, a concession is given to a small syndicate. When this syndicate had taken out its concession the Burma Oil Company found it in the interests of their shareholders to try and draw away as large a proportion as possible of the oil that was under the land of their neighbour. As a result—I have a photograph which I shall be pleased to show to any hon. Member—there are three lines of oil wells all along the border, which is a most extravagant and wasteful method of tapping oil. After that I went to Persia, where the whole of the oil in the southern part of the country has been given in the form of a single concession to the Anglo-Persian Oil Company. There one found a model of the subterranean deposits of oil, the geologists were calculating carefully the pressure of the gas and the level of the oil, and when gas had come up it was actually pumped down again into the earth in order to make certain that in future years the largest possible proportion of the oil deposits might be developed and worked. So it will be here, owing to this legislation and the way it has been framed, and the Board of Trade can decide how our oil deposits, if they exist, are to be developed.

I sincerely congratulate the Government upon having adopted a method of this kind, which I believe to be in accordance with the best and most enlightened administrative and scientific opinion all through the world. After what has been said by the hon. Member for Smethwick (Mr. Wise), who claimed to speak for hon. Members on that side of the House but really only for a small section of them. I should like to assure the President of the Board of Trade that there is another section, also small, for which I can speak, who sincerely congratulate him and which is just as pleased at the introduction of the Bill as any Member of the Liberal or Socialist Opposition.

Before I sit down I should like to say something upon the argument that has been put forward, that this Bill contains something in the nature of confiscation of existing rights. The argument appears to show a mentality which is not the true mentality of the Tory party. We have never been over concerned with abstract principles, but have always been anxious to deal with concrete problems in the best and fairest possible way. I hope that I accept most fully the duty of Conservatives to defend the legitimate rights of property as they exist, but that does not oblige us to allow new vested interests to spring up in the future. I have never denied that I regret very much that, owing to the decision of the court in Queen Elizabeth's reign, which court I think wrongly interpreted the law as it existed at that time, in the case of Northumberland versus the Queen, royalties ever got into private hands. I would say to the official Opposition that those royalties have been in private hands for so long, and have been bought and sold, that they have become a legitimate form of private property, and if any proposal were put forward—it has not yet been put forward—for the confiscation of those royalties without compensation, I would support my hon. Friend the Member for Smethwick.

But I see no objection to applying the principle of this Bill to the case of coal, in parts of the country where coal is not known to exist or where there is so little likelihood of it being developed that it has not entered into the value of the land. This cannot be regarded as any real interference with the rights of property. There is here only a purely hypothetical and possible adventitious increment in value. The hon. Member for Smethwick completely gave his case away when he referred to the fact that the British administration in colonial areas has taken over unoccupied undeveloped land, nationalised it and held it in the interests of the population as a whole. Surely, the analogy between that undeveloped land and the case of the petroleum which may or may not exist, and may or may not be workable, is a very close one, and that, providing there is no destruction of vested property rights which exist at the present time, there can be no objection to our laying down a law which will prevent, in the case of this development, rights accruing which most of us regret have accrued in the case of the coal-mining industry. Therefore, I congratulate the Government very warmly upon their Bill, and, although I hope that a few changes may be made in Committee, particularly for the purpose of preserving the amenities of neighbourhoods which it is proposed to develop for oil purposes, I hope that the Bill will be given a very large majority on its Second Reading.

8.55 p.m.

Mr. DAVID GRENFELL

I think that the Minister in charge of the Bill can be congratulated upon its general reception to-day, and upon the narrowness of the ground on which the opposition to it has been based. Indeed, we find that the most unrelenting opponents of the Bill base their opposition on purely personal rights. There is no technical opposition to the Bill; there is no suggestion that it is not a workable Bill; the opposition is based entirely upon unwillingness to allow any invasion of private rights in what is regarded as the ownership of land and minerals. The note that has been struck by the opponents of the Bill is almost monotonous in that regard. I think that the House also can be congratulated upon the testimony which has been received from all quarters of the House that enlightened opinion here, and, we believe, in the country, is not going to tolerate that insistence in these days, and that, when private ownership and assumed private rights come into conflict with the national interest, they must give way to what is really the interest of the whole community.

I was much interested by some of the speeches this afternoon, and especially by that of the hon. and gallant Member for North Leeds (Captain Peake), who spoke as a coalowner with intimate knowledge of the fuel industry of this country and of the difficulties of operating the great mining industry in view of the manifold private interests which are involved in that industry. He drew upon an experience which is shared by Members on this side of the House as to the, difficulties of accommodating what are regarded as private interests with the interests of the industry and the national interest. There have been many audible meditations on the nature of property itself, and the limits to which property claims can be extended. The Noble Lord the Member for Rutland (Lord Willoughby de Eresby) took us to great heights, with which I am not very familar, and downwards to a region with which also I am not acquainted, and with which I hope never to become acquainted. He said that on his estates he claimed the right to go up and down as far as his imagination could carry him. That shows how utterly ridiculous are these claims. Even the most ancient Member of the House must realise that we live on a globe, and that on the other side of this globe there are people who hold rights of private property and could come at least half-way to meet us; and when the point is reached where the interests of the Antipodes and our own interests come into conflict, there is no superficial area; it is merely a point, and both sides would come to a point where there is no possibility of extension and no possibilty of establishing any kind of claim. That only shows how ridiculous are claims that you can go down as far as you like in the exercise of your rights of private ownership.

But the most difficult thing in this regard was referred to by the Noble Lord the Member for Aldershot (Viscount Wolmer). He said that we were concerned with the rights of petroleum owners who had not yet been discovered. I am much more concerned with the fact that the petroleum has not yet been discovered. If it had been established that petroleum existed over any area, the claim of ownership would soon be determined by people who are interested, but I find it exceedingly difficult to acknowledge the claim of ownership of petroleum which has not been located or discovered in any way, and I cannot follow those who argue that they can assert ownership over any object which has not been located or identified.

We have heard this afternoon disquisitions upon rights of property in water, brine, and liquid substances of that kind, but the claim to the ownership of petroleum is now to be vested in His Majesty. Nobody objects to His Majesty exercising the right of ownership over all forms of wealth, because His Majesty in this regard represents the community, the whole of the people of this country. Because of the difficulty and impracticability of asserting private rights of ownership, the Bill says that, where petroleum is found, the rights shall be vested in His Majesty in the name of the law and of the authority of the State in this country. The Noble Lord who moved the Amendment spoke with a great deal of knowledge, proving that he had not only made a study of the immediate conditions of his own neighbourhood, in which he is interested as a landlord and as a prospector for oil, but also that he. knows a great deal about the occurrence of oil in the petroliferous areas of the world.

I do not think I am venturing too far into the realm of the geologist when I say that oil has not been found in any large quantities in any of the older rocks which compose the crust of the earth. The rocks of the primary period do not contain oil. Those of the secondary period contain, I think, a little. But the greater part of the oil of the world is discovered in the tertiary formations, which are not very widely represented in this country. We have some tertiary rocks, but not those peculiar formations in which oil has been discovered. A large extent of our Island is covered with the older formations, from the coal measures downwards, but we are not so largely furnished with the formations in which oil is usually found in the oil-bearing regions of the world.

The Noble Lord gave an explanation of the cause of the existence of oil, and described its history. We are all familiar with the history of coal; the Noble Lord has extended our knowledge by giving the version of geologists of the existence and history of the liquid form, namely, oil. This combination of hydrocarbons, which is almost identical with the solid fuel that we know as coal, exists in a liquid state, not in the same geological epochs or formations, and not due to the same form of organic decomposition which produced our coal measures. But neither the Noble Lord nor anyone else standing here for any short period of time could explain the various conditions under which this mobile fuel exists, not fixed and stratified and laid down in its position for all time by Nature's processes, as coal is. This petroleum, which moves about and which occupies interstices in the crust of the earth under conditions where a great deal of folding and fracture has taken place, cannot be located and held to be the personal property of any one person. Indeed, when the existence of this fluid has been determined, it is very difficult to know, without a very wide survey, upon whose particular piece of property you will put your borehole and draw the oil from any known area. The hon. Member for Aberdare (Mr. G. Hall) and I went to Russia in 1925 and spent some time in the Baku oilfield. We found they were doing very considerable work in surveying that almost devastated oil bearing region. We found that there had been 250 companies operating on a few square miles of land, one boring on an anticline here, the other on a syncline there, the convolutions of the ground lending themselves to all kinds of changes in the disposition of the liquid reservoirs themselves and leading to all kinds of disappointments in the operation of the respective companies. After the revolution, when the Russian Government came into the possession of these oil measures, they had to adopt a plan by which those 250 separate operating companies could be brought under one control, in order to plan surveys for future operations. We recognise the difficulty of establishing the private exploitation of oil deposits under those conditions. There is the difficulty of determining to whom a particular area of oil belongs and there is the difficulty, having bored a hole in a certain spot, of determining how far you will draw on the resources of neighbouring areas, and whether, because you have bored on the surface of your own estate, you are entitled to draw oil from underneath your neighbours' estate and despoil him of the opportunity of exploiting the oil. There is the question of flooding. If you take oil out something takes its place and it is usually water.

We have heard a good deal about these private rights and I am sure they have not been closely enough examined in the past. There is the story of the Kent coalfield. A very early geologist who had a remarkable insight into the problems of geology, a man named Godwin Austen, in 1845 or 1847, after a considerable study of the formation of strata extending from Ireland through South Wales into the South of England, to the North of France, Belgium and Germany made the deduction, which it was very difficult to arrive at in those days, that the chalk in Kent lay immediately upon coal measures and that, when the chalk had been bored, coal would be found immediately underneath. He was scoffed at, and among those who derided him with the most contempt were the landowners of Kent. He was followed by a better known geologist, Boyd Dawkins, who proved that his friend's theory was tenable and bore-holes were sunk. The landowners opposed the sinking of shafts. They did not want coal to be found in Kent at all. They said Kent was the garden of England, a county for apples and hops, and it was no coalfield and they obstructed it as strongly as they could, but ultimately the existence of a vast coalfield was proved and has now become known to the whole world. There is an example of the landowners' obstruction to the development of our mineral resources. No one can say that the landowner in Kent has the slightest title to claim royalties for coal found under those conditions.

I doubt the existence of this liquid fuel. With my limited knowledge of geology I do not see these vast stores of oil underneath the surface of our country, but if it is found, it does not belong to any landowner, who has never made the slightest contribution toward the knowledge of petrology and the means by which oil can be discovered and exploited. Hon. Members have spoken of compensation. If I understand English, compensation means a payment to balance a loss. I would ask those who claim compensation what they lose if the oil is taken. Hon. Members have made very strong claims for the recognition of compensation for amenities. We know how badly marred the surface of the country is by industrial operations, but do the representatives of the land- lords believe that they are the only people who suffer loss of amenities? I am a nature lover as much as any landowner. Why should a landowner be paid because a beautiful valley has been made haggard and ugly. If there is a loss of amenities, why should not I be given compensation? I certainly am not objecting to compensation for amenities but the compensation should be paid to a public fund, from which there should be promoted the largest possible measure of repair for the loss of amenities. We do not criticise the Bill for its general machinery. I am not as strongly of the opinion as some on this side of the House that this is Socialism. It is not my Socialism. My Socialism goes very much further. I shall shock the House of Commons some day, but for the moment I know it is no use talking about Socialism to the defenders of landlordism and capitalism whom I see before me. I support the Bill not because it is Socialistic but because it is the only practical plan for the exploitation of whatever lies beneath the surface of the country.

9.14 p.m.

Mr. E. BROWN

I would point out to some of those who oppose the Bill that, merely because certain propositions are unwelcome to them, to argue that this is Socialism is a very dangerous thing to do, for if this is, as the Government believe, a practical proposition, a wise proposition and a right proposition, if you are going to label that Socialism you run the danger of making Socialism popular, and that is the last thing that I or any supporter of the Government wants to do. I suggest that no Member of this House can understand the meaning of the term "Socialism" in any of. its varying classical expressions, and compare that theory with what is in this Bill. It is the very opposite. It is true that in the heart of the Bill the assumption by the Crown of the mineral right in petroleum is nationalisation, but nationalisation is not Socialism. It depends entirely on the purpose for which it is applied. For what are we applying this nationalisation of minerals? Not for Socialism, but to provide the only practical basis on which private enterprise can operate. It is the conclusion of the Government that there is no alternative to this particular proposition if private endeavour in the search for and winning and use of oil are to have a fair opportunity of operating in this island.

The hon. Member for Gower (Mr. D. Grenfell) is quite right. I think the Government can congratulate themselves upon the varied support which they have had for the Bill in this Debate. There have been a number of speeches against the Bill, representing approximately the same view, although not quite the same, and those who analyse those speeches carefully will find that there is more than one inconsistency to be found in the arguments used. This Bill has a single basis, but the arguments of those who oppose the Bill have varying bases. There is the appeal to fear, there is the appeal to suspicion, there is the appeal to prejudice, there is the appeal to interest, there is the appeal upon the ground of organisation and detail, and there is, finally, that very fine appeal, which is always listened to with pleasure and interest whenever it is made with sincerity, the appeal to conviction. All these varying appeals have been heard in the course of this Debate, but let us look at the inconsistencies.

Some of these appeals have been based on the statement that no oil in any degree will be found to justify operations of this kind in this island, and inside of five minutes the same speakers have been saying that you will take away millions and millions of pounds' worth of oil. We have had the appeal, first of all, to the assumed fear that no oil exists within our little island, and the same speakers, within a moment or two, have been appealing to us not to do certain things because of the gravity of the financial interests affected. I suggest that the House will be wise to brush aside inconsistencies of that kind, for things which are fundamentally inconsistent are fundamentally frivolous, and arguments of that kind are frivolous. You can build nothing upon them. Let us look at the Bill itself. I am asked by speaker after speaker why the Bill has been introduced.

Captain WATERHOUSE

Hear, hear‡

Mr. BROWN

The hon. and gallant Member for South Leicester (Captain Waterhouse) says "Hear, hear"; and why? The noble Lord the Member for West Derbyshire (Marquess of Hartington) made a very remarkable speech. We are all sorry enough that he does not take a larger share in the general Debates in this House, when he gives us his specialised knowledge. He feels very strongly about this, but I think he will find, on reflection, that that speech was marred by suspicion. He asked why the Bill was introduced. For no other reason than this, that the Government, surveying the situation and the needs of the present time, having had indications of renewed interest in the search for oil, have surveyed the whole ground, have taken the best advice, have exhaustively examined all possible alternatives, and have produced this Bill for the assent of both Houses of Parliament and of the country as the only practical scheme which will enable a thorough search for and controlled development of this mineral oil to be made in our own country. That is the only reason, and if my hon. Friends do not accept that, I can only reply that surely to build opposition to a Bill on grounds of suspicion of some undefined interest behind, which has no foundation in fact, is not a sound basis on which to oppose a great piece of constructive legislation.

I may remind the House that this Measure has had an unusually detailed examination in another place and has now-come down to us. Why? I suggest, for these five reasons—first of all, that it is generally agreed that if there are subterranean treasures in oil, it is in the national interest that they should be won, worked, and used to the full; second, that these processes should be carried out by competent and capable persons; third, that the development should not be an indiscriminate and haphazard scramble, but a controlled and unified process; fourth, that it should involve the smallest possible interference with our amenities; and last—and I think this will be generally agreed, although I gather that the Noble Lord the Member for West Derbyshire (Marquess of Hartington) does not agree with it—that none of these proposals will be realised under the present law and in present conditions, as the difficulties confronting private endeavour are too many and the law, as has already been pointed out, in some respects apparently is too inequitable to give competent, practical persons any incentive to do this most valuable national service.

The Noble Lord in one respect misled the House, I am quite sure unwittingly, but he really did misrepresent the answers given to him in this House. He based the major part of his argument, which was concerned about the present situation, on the assumption that the very introduction of this Bill had held up development. If the Noble Lord will reread the very detailed and full answers that I gave him in this House—I will give hon. Members the dates, as I do not wish to detain it too long by reading the whole of these long answers, but the first was given on the 9th April and the second on the 26th April of this year—I think he will come to the conclusion that unwittingly he misled the House this afternoon. We had not held up a single licence until the Government had decided to introduce this Bill. Two were refused because the applicants were not considered fit persons to hold them, and all the suspicion appears to be based on the fact that it is impossible, from the public interest on the one hand—and, I may add, equally in the interests of the public on the other hand—that names on the one hand and areas on the other should be stated in advance of the licence being granted.

The Noble Lord the Member for Rutland and Stamford (Lord Willoughby de Eresby) gave the complete answer in his most admirable speech, on the whole supporting the Bill, just now, when there were only too few to listen to it. He had not intended to speak, but because my right hon. Friend the President of the Board of Trade used the county of Rutland merely as an illustration, thinking it was the illustration most unlikely to mislead anybody, the Noble Lord said he pricked up his ears. Of course he did, and so would the general public prick up their ears if names and areas were given in advance of licences being granted. It is the very fact of the unknown quality about petroleum under the land that makes it essential that this shall be done by responsible people and by those responsible to Parliament, under regulations, as are laid down in this Bill, approved by Parliament, before a single licence can be granted—

Viscount WOLMER

If the Government are going to have a monopoly of the oil, what does it matter if people prick up their ears? Why should not there be two applicants for a licence instead of one?

Mr. BROWN

There may be 20, but the Noble Lord will know that it will not always be in the public interest to distribute this information.

Viscount WOLMER

Why not?

Mr. BROWN

The answer must be obvious in the nature of the problem. I suggest that only prejudice can fail to appreciate that answer. Let us see the problem with which the Government, were faced. Previous Governments have found it necessary to pass special legislation with regard to petroleum. The Act which is now administered is administered by my Department, which is a small but competent one. I do not think anyone who knows anything about the valuable work done by our experts in advising British subjects all over the Empire and all over the world will fail to appreciate what I have said. When the Noble Lord was making his speech, what was his proposition? That the Government should take advice. The Government have very skilled expert advice at their disposal and, although the Noble Lord gave us this afternoon a very able analysis based on personal knowledge with regard to what happened in drilling two boreholes in Derbyshire, that is a very small basis on which to build conclusions for the whole field of this country or the varied processes and methods of dealing with oil throughout the world. Previous Governments, I say, have found it necessary to enact special legislation. The Act of 1918 is at present being administered by the Board of Trade and by the Secretary for Mines. What is the position now? The Noble Lord asked questions about the number of licences. When he told the House that the present situation gives ample incentive, the answer is in the record of the last 15 years. The answers I Have given to him prove that in this period 10 licences have been applied for, seven of them have been granted, four of them have lapsed, and there are only the three now named in the Schedule of the Bill which operate.

The very nature of the oil under the surface brings a whole series of complications in regard to surface rights and, therefore, those who drafted the Act of 1918 and carried it though both Houses of Parliament laid it down that no one could bore for oil in this country except by the possession of a licence from the Government? What does that mean? It means that when a licence is applied for, it may be for an area four or five miles square or more, there are, as my right hon. Friend said, in some cases thousands of conflicting surface rights. In some cases there are scores. The present law makes the position that once one licensee has been given the right to bore no other person can bore inside that area. No other landowner can bore on his own land. This seems to be approved by my Noble Friend the Member for West Derbyshire. I was surprised that he should appear to be arguing that as long as one surface owner got the royalty the other 90 or 900 did not matter.

Marquess of HARTINGTON

I hesitate to interrupt my hon. Friend, but he is misrepresenting the case. No case of 90 or 900 royalty owners in a given borehole can arise.

Mr. BROWN

I am not talking about a given borehole, but of a licensed area, and I shall contend, with all respect to the Noble Lord, that there are cases where there may be scores or hundreds of surface rights. That is the present situation, and the fact that these arrangements in 15 years have given us no adequate search for oil, and in the judgment of the Government are not likely to give us any adequate search, has led the Government to say that three things are necessary: first, the settlement of royalty questions as a basis; secondly, licences for areas wide enough to get unified control with due regard to the amenities not merely of the neighbourhood of boreholes, but as regards the working and transporting of the product; and, thirdly, that if competent and capable persons are to be encouraged to develop oil in our country there must be sufficient working facilities granted under the law, so that they will not be hampered unreasonably in their search.

The Bill proposes three main things. First of all, it proposes to vest property in petroleum in the Crown, and I notice one of my hon. Friends was saying that the law was at present that petroleum was the property of the surface owner. I should not contest that, but neither would I say that it is so. I do not think any Member of the House is entitled to say that it is so. The fact is that it has not been laid down in a court of law, and there are conflicting opinions about it. The House was warned by the late Mr. Bonar Law in 1919 quite frankly concerning the doubt about this matter. In 1919 the Attorney-General of that time, who is now the Lord Chief Justice, Lord Hewart, said that in his opinion it was so, but Mr. Bonar Law, about the same time, came down to the House and said the matter was under consideration, and, pending a decision, it was the policy of the Government to withhold licences. Until the Government had reached a decision the purchasers of land and petroleum rights were warned not to assume that the ownership of petroleum was vested in the holders of the surface rights. That is the opinion of a responsible Minister of the Crown, not a decision of a court of law. I am being, as I always am, quite frank and stating the case fairly. It has not been stated fairly by all speakers to-day. It has been said that the law is that it is the property of the surface owner, and I say that it is a moot point. An hon. Member spoke about the removal of doubts. This Bill is brought forward to remove all doubts and to make it quite clear.

We are asked to reject the Bill because it is said to be confiscation. My hon. Friend the Member for Gower, who said it was not Socialism as he understood it, was a little more careful than some of his friends on that bench, because it will be clear from the Schedule that there are three exceptions to the vesting of ownership in the Crown. I expected to be twitted with a logical, or at least a verbal, inconsistency in exempting these three licence areas from the Bill. Why was it done? Because the Government meant to make it clear that if there were what might be termed an admitted right they would admit it. The hon. Member for Doncaster (Mr. Molson) stated the situation quite accurately. Where admitted rights are found they are to be admitted and, of course, compensated for if they are taken away. That is why the three exceptions are in the Schedule of the Bill, and I do not think thoughtful Members can fail to understand that the Government have taken every point very carefully into consideration. Hon. Members talk of confiscation. Confiscation of what? The fact is, that not a single acre of land in this country has changed hands at the added value of one single coin because oil was suspected to be underneath it. Not one single acre to-morrow morning will change hands for that reason. Since the determination of the royalty question is vital if there is to be proper, unified control and development by those who are capable of doing it for the national interests, the Government say that this is the only practical basis on which it can be done. I would ask the House to reflect for one moment on the whole of the Debate and to note that, apart from the suggestion that the present system might go on, and apart from two suggestions about procedure, not one solitary Member has put forward any constructive alternative to the proposition which forms the basis of the Bill.

Mr. RHYS

Will the hon. Member be good enough to say why he refuses to allow his House to ratify any licences granted, even if it is done in secret? Is it not a fact that the House entirely abrogates its right over any licences granted?

Mr. BROWN

The answer is in the machinery of the Bill. I am going to explain what the machinery of the Bill is. The machinery of the Bill provides that the Board of Trade shall be given power to issue licences, but before a licence can be granted under the terms of the Bill regulations have to be made. Those regulations have to be laid on the Table of this House for 28 days, and they can be challenged, debated and annulled by this House, if the House does not think that they are adequate and suitable for the purpose. No licence, then, would be granted until the House has had an opportunity to discuss all the particulars to be laid down in the licence as to working, and the conditions which are laid down in the Bill. Further, when a licence is granted, what is the position? It seems to be assumed that the whole of the Bill runs upon the basis of compulsion. That is a complete misreading of the Bill. The basis of the Bill is voluntary agreement. It is because the Mines (Working Facilities) Act, 1923, is not fully appreciated by hon. Members that they appear to assume that the whole procedure of the Bill rests upon the basis of compulsion. Nothing could be further from the fact. The machinery is, that once the Board of Trade is satisfied, under the terms of the regulations approved by this House, that the licensee is a fit and proper person to exercise the right to drill, as the law now stands, he will make his own voluntary arrangements with the surface owners in the area with which he has to deal.

Mr. G. BALFOUR

The hon. Member said "approved by this House." Does he not mean, not disapproved by the House?

Mr. BROWN

I stand corrected. In a matter of this kind, especially in regard to the first regulations, Parliament will be very careful to see that they meticulously examine the regulations. I am sure that the Noble Lord and those who follow him will see that they avail themselves of the opportunity of examination and that Parliament will annul them if the regulations are found not to be competent for the purpose. I am sure that they will take full advantage of the machinery provided. The licensee will make his voluntary arrangements with the surface owners. That, surely, means that if we are to have licences for areas wide enough, and if we are to have unified control, with due regard to amenity, it will be the best endeavour of every licensee to come to the best possible arrangement with the surface owners before he thinks of applying under the machinery of the Mines (Working Facilities) Act, 1923. Even then, the House must understand that the machinery of the Act of 1923 cannot operate unless the court, that is, the Railway and Canal Commission, which is a branch of the High Court, is satisfied as an over-riding condition that it is in the national interest that such facilities should be granted.

There are four special conditions in the Act of 1923 which have to be satisfied before application can be made to the court. In addition to those four special conditions, which are contained in Section 4 (1), there are two other additional propositions which we have laid down in the Bill, (1) that the Railway and Canal Commission must have regard to amenities, and (2) that if compulsion is exercised for the granting of these ancillary rights, added compensation of not less than 10 per cent. must be awarded by the Commission, in addition to the compensation they would award in the ordinary way. In case some hon. Member thinks that this is cumbrous and costly machinery for the surface owner, let me say that the Bill makes it clear that only in one case will the landowner have to pay his own costs. In no case will he have to pay the licensee's costs. If the court decides that it is in the national interests, having due regard to amenity and having been prepared to add the compensation under the law, and that the compensation assessed by the Commission is lower than an offer made in writing by the licensee to the surface owner, in that case only will the surface owner have to pay his own costs before the tribunal.

There are a number of other details which it is not my duty to go into, but I suggest that, on reflection, thoughtful Members will come to the conclusion that it is very much in the national interest to have this search prosecuted. If, as some hon. Members have suggested, there is no likelihood of oil being found, the fears and suspicions of hon. Members need have no weight in the Division Lobby. If, on the other hand, there is national treasure in oil there, it is surely the duty of a National Government, before all other Governments, to see that obstacles, based on the present law and the present conditions, in the way of a competent search, are removed. The Bill has no inception except the Government's belief that at its root the policy of encouraging the search for domestic petroleum is in the national interest and that this Bill provides the only practical and fair way in which such a search can be carried out by competent and capable persons, with due regard to amenities.

Marquess of HARTINGTON

May I ask the hon. Member for a definite answer to the question that I put to him? Why were the Government unwilling to grant the five applications for licences which had been made while this Bill was pending? He says that I unintentionally misled the House.

Mr. BROWN

I was reluctant to detain the House too long. Let me read the answer in full. It was given on 9th April: Marquess of HARTINGTON asked the Secretary for Mines how many applications for licences to bore for petroleum have been received in the last 10 years from British and foreign undertakings, respectively; and how many of each have been refused? Mr. E. BROWN: During the last 10 years, 10 formal applications for licences were received by the Petroleum Department, of which two were granted, two were refused, one was withdrawn, and in the remaining cases the formalities connected with the issue of licences had for various reasons not been completed when the Government announced that pending the consideration of the Bill now before Parliament no further licences would be issued. A number of inquiries regarding licences have also been received during the last 10 years, which did not, however, proceed to the stage of a formal application. There is nothing in the Petroleum (Production) Act, 1918, under which licences have hitherto been granted, to prevent a foreign undertaking from applying for a licence, or from providing capital required by a licensee. It would appear that all the formal applications received were made by British concerns, but the Department has no information as to how far foreign interests might have been concerned in the applications or inquiries. It should be borne in mind that the amount of interest displayed in this question cannot be measured entirely by the number of applications received, but depends rather upon the standing of the applicants or inquirers."—[OFFICIAL REPORT, 9th April, 1934; cols. 17 and 18, Vol. 288.] Subsequently, on 26th April, there was a further question: Marquess of HARTINGTON asked the Secretary for Mines the names of the five applicants for licences to bore for petroleum whose applications have been held up pending legislation; the dates of applications; the areas to which the applications applied; and why the applications could not be granted pending legislation? Mr. E. BROWN: All applications for licences under the Petroleum (Production) Act, 1918, were treated as confidential until the licence was issued, and I regret that I am not, therefore, in a position to furnish the particulars asked for in the first and third parts of the question. In reply to the second part, the dates of the applications were between January, 1931, and February, 1933. As regards the last part, the Government decided that as the whole situation in regard to the development of oil in this country is brought under review in the legislation now before Parliament, it was undesirable that any further licences should be granted until Parliament had had an opportunity of reaching a decision on the new legislation. Before a licence was issued under the 1918 Act, certain conditions and formalities had to be complied with, the more important of which were the furnishing of evidence that the applicants had acquired rights to enter on at least a portion of the area in respect of which a licence was sought, ability and willingness to undertake a certain amount of drilling, and the shape and dimensions of the area to be licensed. In each of the five cases some of these matters were outstanding when the Government announced their decision."—[OFFICIAL REPORT, 26th April, 1934; cols. 1893 and 1894; Vol. 288.] That is the, whole answer, and, as between the Noble Lord's speech and those answers, I leave the House to say whether this is not a fair statement of my reply to the Noble Lord.

Marquess of HARTINGTON

With all respect to my hon. Friend, in the answer which he has read at such unnecessary length he gave the figures two, two and one, which I believe make five. That number subtracted from 10 also leaves five. That is to say, five applications were outstanding. My hon. Friend has given a number of reasons why licences might be refused, but he has not given the reasons why these particular five licences were refused. He said that in every case some reason was given. May I press him for an answer on that point? It has been drawn to my notice that at least in one case a lease was signed, sealed and delivered, and nothing was wanting in order to start oil drilling except the permission of a Minister. Why was the licence refused?

Mr. BROWN

That is the sole reason for the introduction of the Bill. Indications were given to the Government that renewed interest was being taken in the subject, and those were among the indications. It was in the light of this that the Government surveyed the whole problem and came to the conclusion, quite rightly I think, that it was not right to give any licence until the House had made up its mind whether the Government's Bill was or was not the right solution.

Marquess of HARTINGTON

May I ask whether the Government have been in consultation with any oil company prior to the production of the Bill? That is a question to which the House is entitled to have an answer.

Mr. BROWN

The answer is that the Government, of course, have done what any Government must do; they have taken advice of every kind and form, to survey the whole field. Indeed we were charged in a speech by one of the Noble Lord's hon. Friends with having been idle in the matter. It is because we have surveyed the whole field that this is being done.

Question put, "That the word 'now' stand part of the Question."

The House divided: Ayes, 251; Noes, 29.

Division No. 294.]	AYES.	[3.39 p.m.
Acland-Troyte, Lieut.-Colonel	Astbury, Lieut.-Com. Frederick Wolfe	Beaumont, Hon. R. E. B. (Portsm'th, C,)
Adams, Samuel Vyvyan T. (Leeds, W.)	Balllle, Sir Adrian W. M.	Benn, Sir Arthur Shirley
Agnew, Lieut.-Com, P. G.	Baldwin, Rt. Hon. Stanley	Bernays, Robert
Allen, Sir J. Sandeman (L'pool, W.)	Balfour, George (Hampstead)	Blindell, James
Allen, William (Stoke-on-Trent)	Balniel, Lord	Boulton, W. W.
Applin, Lieut.-Col. Reginald V. K.	Barclay-Harvey, C. M.	Bower, Lieut.-Com. Robert Tatton
Ansley, Lord	Barrie, Sir Charles Coupar	Bowyer, Capt. Sir George E. W.
Aske, Sir Robert William	Beaumont, M. W. Bucks., Aylesbury)	Boyce, H. Lesile
Boyd-Carpenter, Sir Archibald	Hartington, Marquess of	Powell, Lieut.-Col. Evelyn G. H.
Braithwaite, J. G. (Hillsborough)	Hartland, George A.	Pownall, Sir Assheton
Broadbent, Colonel John	Haslam, Henry (Horncastle)	Procter, Major Henry Adam
Brocklebank, C. E. R.	Haslam, Sir John (Bolton)	Pybus, Sir Percy John
Brown, Col. D. C. (N'th'l'd., Hexham)	Headlam, Lieut.-Col. Cuthbert M.	Raikes, Henry V. A. M.
Brown, Ernest (Leith)	Hellgers, Captain F. F. A.	Ramsay, T. B. W. (Western Isles)
Browne, Captain A. C.	Heneage, Lieut.-Colonel Arthur P.	Ramsbotham, Herwald
Buchan-Hepburn, P. G. T.	Hepworth, Joseph	Ramsden, Sir Eugene
Bullock, Captain Malcolm	Herbert, Major J. A. (Monmouth)	Rankin, Robert
Burgin. Dr. Edward Leslie	Hore-Bellsha, Leslie	Rathbone, Eleanor
Burnett, John George	Hornby, Frank	Ray, Sir William
Burton, Colonel Henry Walter	Home, Rt. Hon. Sir Robert S.	Reed, Arthur C. (Exeter)
Cadogan, Hon. Edward	Horsbrugh, Florence	Reid, Capt. A. Cunningham-
Campbell, Sir Edward Taswell (Brmly)	Hudson, Capt. A. U. M. (Hackney, N.)	Reid, David D. (County Down)
Caporn, Arthur Cecil	Hudson, Robert Spear (Southport)	Remer, John R.
Carver, Major William H.	Hunter, Capt. M. J. (Brigg)	Rhys, Hon. Charles Arthur U.
Castlereagh, Viscount	Hurd, Sir Percy	Rickards, George William
Cautley, Sir Henry S.	Hurst, Sir Gerald B.	Rosbotham, Sir Thomas
Cazalet, Capt. V. A. (Chippenham)	Jamleson, Douglas	Ross Taylor, Walter (Woodbridge)
Chamberlain, Rt. Hon. N. (Edgbaston)	Jones, Lewis (Swansea, West)	Ruggies-Brise, Colonel E. A.
Chapman, Sir Samuel (Edinburgh, S.)	Kerr, Hamilton W.	Runciman, Rt. Hon. Walter
Christle, James Archibald	Lamb, Sir Joseph Quinton	Runge, Norah Cecil
Clayton, Sir Christopher	Lambert, Rt. Hon. George	Russell, Albert (Kirkcaldy)
Cochrane, Commander Hon. A. D.	Law, Sir Alfred	Russell, Alexander West (Tynemouth)
Colfox, Major William Philip	Leckie, J. A.	Russell, Hamer Field (Sheffield, B'tside)
Colville, Lieut.-Colonel J.	Leech, Dr. J. W.	Russell, R. J. (Eddisbury)
Conant, R. J. E.	Lees-Jones, John	Rutherford, Sir John Hugo (Liverp'l)
Cook, Thomas A.	Leighton, Major B. E. p.	Salt, Edward W.
Cooper, A. Duff	Lennox-Boyd, A. T.	Samuel, Sir Arthur Michael (F'nham)
Copeland, Ide	Lewis, Oswald	Sandeman, Sir A. N. Stewart
Croft, Brigadier-General Sir H.	Liddall, Walter S.	Savery, Samuel Servington
Crooke, J. Smedley	Lindsay, Noel Ker	Selley, Harry R.
Crossley, A. c.	Lister, Rt. Hon. Sir Philip Cunliffe.	Shakespeare, Geoffrey H.
Dalkeith, Earl of	Locker-Lampson, Rt. Hn. G.(Wd.Gr'n)	Shaw, Helen B. (Lanark, Bothwell)
Davies, Maj. Geo. F.(Somerset, Yeovil)	Loftus, Pierce C.	Shepperson, Sir Ernest W.
Davison, Sir William Henry	Lovat-Fraser, James Alexander	Simmonds, Oliver Edwin
Dawson, Sir Philip	Mabane, William	Smiles, Lieut.-Col. Sir Walter D.
Denman, Hon. R. D.	MacAndrew, Capt. J. O. (Ayr)	Smith, Louis W. (Sheffield, Hallam)
Denville, Alfred	MacDonald, Rt. Hon. J. R.(Seaham)	Smith, Sir Robert (Ab'd'n & K'dlne, C.)
Despencer-Robertson, Major J. A. F.	Macdonald, Capt. P. D. (I. of W.)	Smithers, Sir Waldron
Dickie, John P.	Maclay, Hon. Joseph Paton	Somerville, Annesley A. (Windsor)
Drewe, Cedric	McLean, Major Sir Alan	Sotheron-Estcourt, Captain T. E.
Dugdale, Captain Thomas Lionel	McLean, Dr. W. H. (Tradeston)	Spender-Clay, Rt. Hon. Herbert H.
Duggan, Hubert John	Magnay, Thomas	Stanley, Hon. O. F. G. (Westmorland)
Duncan, James A. L. (Kensington, N.)	Maitland, Adam	Stewart, J. H. (Fife, E.)
Dunglass, Lord	Makins, Brigadier-General Ernest	Stones, James
Eady, George H.	Margesson, Capt. Rt. Hon. H. D. R.	Strickland, Captain W. F.
Edmondson, Major Sir James	Milne, Charles	Sueter, Rear-Admiral Sir Murray F.
Elliot, Rt. Hon. Waiter	Mitchell, Harold P.(Br'tfd & Chisw'k)	Thomas, James p. L. (Hereford)
Emmott, Charles E. G. C.	Molson, A. Hugh Elsdale	Titchfield, Major the Marquess of
Emrys-Evans, P. V.	Monsell, Rt. Hon. Sir B. Eyres	Touche, Gordon Cosmo
Entwistle, Cyril Fullard	Morgan, Robert H.	Tufnell, Lieut.-Commander R. L.
Everard, W. Lindsay	Morris-Jones, Dr. J. H. (Denbigh)	Ward, Lt.-Col. Sir A. L. (Hull)
Fraser, Captain Sir Ian	Morrison, G. A. (Scottish Univer'ties)	Ward, Irene Mary Bewick (Wallsend)
Gault, Lieut.-Col. A. Hamilton	Morrison, William Shephard	Wardlaw-Milne, Sir John S.
Gilmour, Lt.-Col. Rt. Hon. Sir John	Moss, Captain H. J.	Warrender, Sir Victor A. G.
Gledhill, Gilbert	Muirhead, Lieut.-Colonel A. J.	Waterhouse, Captain Charles
Gluckstein, Louis Halle	Munro, Patrick	Watt, Captain George Steven H.
Goff, Sir Park	Nation, Brigadier-General J. J. H.	Wedderburn, Henry James Scrymgeour
Graham, Sir F. Fergus (C'mb'rl'd, N.)	Nicholson, Godfrey (Morpeth)	Whyte, Jardine Bell
Granville, Edgar	Nicholson, Rt. Hn. W. G. (Petersf'ld)	Williams, Herbert G. (Croydon, S.)
Grattan-Doyle, Sir Nicholas	Peake, Captain Osbert	Willoughby de Eresby, Lord
Graves, Marjorie	Pearson, William G.	Wilson, Lt.-Col. Sir Arnold (Hertf'd)
Gunston, Captain D. W.	Peat, Charles U.	Windsor-Clive, Lieut.-Colonel George
Guy, J. C. Morrison	Percy, Lord Eustace	Wise, Alfred R.
Hacking, Rt. Hon. Douglas H.	Perkins, Walter R. D.	Womersley, Sir Waiter
Hales, Harold K.	Peters, Dr. Sidney John	Worthington, Dr. John V.
Hamilton, Sir George (Ilford)	Petherick, M.
Hanbury, Cecil	Peto, Geoffrey K.(W'verh'pt'n, Bilst'n)	TELLERS FOR THE AYES.—
Hannon, Patrick Joseph Henry	Pike, Cecil F.	Sir Frederick Thomson and Sir
Harbord, Arthur	Potter, John	George Penny.
NOES.
Attlee, Clement Richard	Davies, Stephen Owen	Hamilton, Sir R. W.(Orkney & Ztl'nd)
Banfield, John William	Dobbie, William	Harris, Sir Percy
Batey, Joseph	Edwards, Charles	Hicks, Ernest George
Brown, C. W- E. (Notts., Mansfield)	Evans, R. T. (Carmarthen)	Holdsworth, Herbert
Buchanan, George	Foot, Isaac (Cornwall, Bodmin)	Jenkins, Sir William
Cape, Thomas	Gardner, Benjamin Walter	Jones, Henry Haydn (Merioneth)
Cocks, Frederick Seymour	George, Major G. Lloyd (Pembroke)	Jones, Morgan (Caerphilly)
Curry, A. C.	Grenfell, David Rees (Glamorgan)	Lawson, John James
Daggar, George	Griffth, F. Kingsley (Middlesbro', W.)	Leonard, William
Davies, David L. (Pontypridd)	Griffths, George A. (Yorks, W. Riding)	Llewellyn-Jones, Frederick
Davies, Rhys John (Westhoughton)	Hail, George H. (Merthyr Tydvil)	Logan, David Gilbert

Lunn, William	Salter, Dr. Alfred	Williams, Edward John (Ogmore)
Maclean, Neil (Glasgow, Govan)	Sinclair, Maj. Rt. Hn. Sir A. (C'thness)	Williams, Dr. John H. (Llanelly)
Mainwaring, William Henry	Smith, Tom (Normanton)	Williams, Thomas (York, Don Valley)
Mander, Geoffrey le M.	Thorne, William James	Wilmot, John
Mason, David M. (Edinburgh, E.)	Tinker, John Joseph	Wood, Sir Murdoch McKenzie (Banff)
Maxton, James	West, F. R.	Young, Ernest J. (Middlesbrough, E.)
Pickering, Ernest H	White, Henry Graham
Rea, Walter Russell	Williams, David (Swansea, East)	TELLERS FOR THE NOES.—
		Mr. John and Mr. G. Macdonald.

Division No. 295.]	AYES.	[9.51 p.m.
Acland, Rt. Hon. Sir Francis Dyke	Grenfell, E. C. (City of London)	Munro, Patrick
Adams, D. M. (Poplar, South)	Griffith, F. Kingsley (Middlesbro', W.)	Nathan, Major H. L.
Adams, Samuel Vyvyan T. (Leeds, W.)	Griffiths, George A. (Yorks, W.Riding)	Nation, Brigadier-General J. J. H.
Agnew, Lieut.-Com. p. G.	Groves, Thomas E.	Nicholson, Godfrey (Morpeth)
Albery, Irving James	Guest, Capt. Rt. Hon. F. E.	Normand, Rt. Hon. Wilfrid
Appiln, Lieut.-Col. Reginald V. K.	Gunston, Captain D. W.	O'Donovan, Dr. William James
Aske, Sir Robert William	Guy, J. C. Morrison	O'Neill, Rt. Hon. Sir Hugh
Attlee, Clement Richard	Hales, Harold K.	Owen. Major Goronwy
Baldwin, Rt. Hon. Stanley	Hall, George H. (Merthyr Tydvil)	Peake, Captain Osbert
Baldwin-Webb, Colonel J.	Hamilton, Sir George (Ilford)	Pearson, William G.
Balfour, Capt. Harold (I. of Thanet)	Hamilton, Sir R. W.(Orkney & Zetl'nd)	Peat, Charles U.
Banfield, John William	Hannon, Patrick Joseph Henry	Penny, Sir George
Barclay-Harvey, C. M.	Harbord, Arthur	Percy, Lord Eustace
Barrie, Sir Charles Coupar	Harris, Sir Percy	Perkins, Walter R. D.
Barton, Capt. Basil Kelsey	Haslam, Henry (Horncastle)	Peters, Dr. Sidney John
Batey, Joseph	Haslam, Sir John (Bolton)	Petherick, M.
Beaumont, Hon. R.E.B. (Portsm'th, C.)	Hellgers, Captain F. F. A.	Peto, Geoffrey K. (W'verh'pt'n.Bilston)
Bevan, Aneurin (Ebbw Vale)	Hepworth, Joseph	Potter, John
Blindell, James	Holdsworth, Herbert	Powell, Lieut.-Col. Evelyn G. H.
Boulton, W. W.	Hornby, Frank	Preston, Sir Walter Rueben
Bower, Lieut.-Com. Robert Tatton	Howard, Tom Forrest	Radford, E. A.
Bowyer, Capt. Sir George E. W.	Howitt, Dr. Alfred B.	Ramsay, T. B. W. (Western Isles)
Braithwaite, J. G. (Hillsborough)	Hudson, Robert Spear (Southport)	Ramsbotham, Herwald
Brass, Captain Sir William	Hume, Sir George Hopwood	Ramsden, Sir Eugene
Brocklebank, C. E. R.	Hunter, Capt. M. J. (Brigg)	Rathbone, Eleanor
Brown, C. W. E. (Notts., Mansfield)	Hurd, Sir Percy	Rea, Walter Russell
Brown, Col. B. C. (N'th'l'd., Hexham)	Hurst, Sir Gerald B.	Reed, Arthur C. (Exeter)
Brown, Ernest (Leith)	Inskip, Rt. Hon. Sir Thomas W. H.	Reid, David D. (County Down)
Browne, Captain A. C.	Jamieson, Douglas	Reid, William Allan (Derby)
Burnett, John George	Jenkins, Sir William	Rickards, George William
Campbell, Sir Edward Taswell (Brmly)	John, William	Robinson, John Roland
Campbell-Johnston, Malcolm	Jones, Sir G. W. H. (Stoke New'gton)	Rosbotham, Sir Thomas
Cape, Thomas	Jones, Henry Haydn (Merioneth)	Ross Taylor, Walter (Woodbridge)
Caporn, Arthur Cecil	Jones, Lewis (Swansea. West)	Rothschild, James A. de
Carver, Major William H.	Jones, Morgan (Caerphilly)	Runciman, Rt. Hon. Walter
Christie, James Archibald	Ker, J. Campbell	Runge, Norah Cecil
Clarke, Frank	Lamb, Sir Joseph Quinton	Russell, Albert (Kirkcaldy)
Clayton, Sir Christopher	Latham, Sir Herbert Paul	Russell, Alexander West (Tynemouth)
Cochrane, Commander Hon. A. D.	Lawson, John James	Russell, Hamer Field (Sheffield, B'tside)
Cook, Thomas A.	Leckie, J. A.	Russell, R. J. (Eddisbury)
Courthope, Colonel Sir George L.	Leech, Dr. J. W.	Rutherford, Sir John Hugo (Liverp'l)
Cripps, Sir Stafford	Lees-Jones, John	Salmon, Sir Isldore
Crooke, J. Smedley	Leighton, Major B. E. P.	Salt, Edward W.
Crookshank, Capt. H. C. (Gainsb'ro)	Leonard, William	Salter, Dr. Alfred
Croom-Johnson, R. P.	Lewis, Oswald	Sassoon, Rt. Hon. Sir Philip A. G. D.
Cruddas, Lieut.-Colonel Bernard	Liddall, Walter S.	Savery, Samuel Servington
Culverwell, Cyril Tom	Lindsay, Kenneth (Kilmarnock)	Selley, Harry R.
Curry, A. C.	Lindsay, Noel Ker	Shakespeare, Geoffrey H.
Daggar, George	Little, Graham-, Sir Ernest	Shaw, Helen B. (Lanark, Bothwell)
Davidson. Rt. Hon. J. C. C.	Lloyd, Geoffrey	Shute, Colonel J. J.
Davies, Edward C. (Montgomery)	Locker-Lampson, Com. O. (H'ndsw'th)	Sinclair, Mal. Rt. Hn. Sir A.(C'thness)
Davies, David L. (Pontypridd)	Loder, Captain J. de Vere	Skelton, Archibald Noel
Davies, Maj. Geo. F. (Somerset, Yeovil)	Loftus, Pierce C.	Smiles, Lieut.-Col. Sir Walter D.
Davies, Rhys John (Westhoughton)	Logan, David Gilbert	Smith, Tom (Normanton)
Davies, Stephen Owen	Lovat-Pierce, James Alexander	Smithers, Sir Waldron
Denman, Hon. R. D.	Lumley, Captain Lawrence R.	Somervell, Sir Donald
Dickie, John p.	Lunn, William	Somerville, Annesley A. (Windsor)
Dobbie, William	Mabane, William	Spencer, Captain Richard A.
Drewe, Cedric	Macdonald, Gordon (Ince)	Spens, William Patrick
Duncan, James A. L. (Kensington, N.)	MacDonald. Rt. Hon. J. R. (Seaham)	Stewart, J. H. (Fife, E.)
Eady, George H.	McEntee, Valentine L.	Stones, James
Edge, Sir William	McKeag, William	Strauss, Edward A.
Edmondson, Major Sir James	McLean, Major Sir Alan	Strickland, Captain W. F.
Edwards, Charles	Maclean, Neil (Glasgow, Govan)	Tinker, John Joseph
Elliot, Rt. Hon. Walter	McLean, Dr. W. H. (Tradeston)	Tufnell, Lieut.-Commander R. L.
Ellis, Sir R. Geoffrey	Macmillan, Maurice Harold	Turton, Robert Hugh
Elliston, Captain George Sampson	Magnay, Thomas	Ward. Lt.-Col. Sir A. L. (Hull)
Essenhigh, Reginald Clare	Mainwaring, William Henry	Ward, Irene Mary Bewick (Wallsend)
Evans, David Owen (Cardigan)	Makins, Brigadier-General Ernest	Warrender, Sir Victor A. G.
Evans, R. T. (Carmarthen)	Mallalleu, Edward Lancelot	Wedderburn, Henry James Scrymgeour
Fermoy, Lord	Manningham-Buller, Lt.-Col. Sir M.	White, Henry Graham
Fleming, Edward Lascelles	Margesson, Capt. Rt. Hon. H. D. R.	Whyte, Jardine Bell
Foot, Dingle (Dundee)	Mayhew, Lieut.-Colonel John	Williams, David (Swansea, East)
Foot, Isaac (Cornwall, Bodmin)	Mills, Major J. D. (New Forest)	Williams, Edward John (Ogmore)
Fraser, Captain Sir Ian	Milne, Charles	Williams, Dr. John H. (Llanelly)
Fuller, Captain A. G.	Mitchell, Harold P.(Br'trd & Chlsw'k)	Williams. Thomas (York, Don Valley)
Gardner, Benjamin Walter	Mitcheson, G. G.	Willoughby de Eresby, Lord
George, Major G. Lloyd (Pembroke)	Molson, A. Hugh Elsdale	Wilson, Lt.-Col. Sir Arnold (Hertl'd)
George, Megan A. Lloyd (Anglesea)	Monsell, Rt. Hon. Sir B. Eyres	Womersley, Sir Walter
Gillett, Sir George Masterman	Moreing, Adrian C.	Worthington, Dr. John V.
Gluckstein, Louis Halle	Morris, John Patrick (Salford, N.)	Young, Rt. Hon. Sir Hilton (S'v'noaks)
Goff, Sir Park	Morrison, G. A. (Scottish Univer'ties)
Gower, Sir Robert	Morrison, William Shepherd	TELLERS FOR THE AYES.—
Graves, Marjorie	Moss, Captain H. J.	Captain Austin Hudson and Dr.
Grenfell, David Rees (Glamorgan)	Muirhead, Lieut.-Colonel A. J.	Morris-Jones

NOES.
Acland-Troyte, Lieut.-Colonel	Law, Sir Alfred	Stourton, Hon. John J.
Balfour, George (Hampstead)	Lockwood, John C. (Hackney, C.)	Waterhouse, Captain Charles
Banks, Sir Reginald Mitchell	McKie, John Hamilton	Wayland, Sir William A.
Broadbent, Colonel John	Nail-Cain, Hon. Ronald	Willams, Herbert G. (Croydon, S.)
Brown, Brig.-Gen. H.C.(Berks.,Newb'y)	Nicholson, Rt. Hn. W. G. (Peterst'ld)	Winterton, Rt. Hon. Earl
Cecil, Rt. Hon. Lord Hugh	Peto, Sir Basil E. (Devon, Barnstaple)	Wise, Alfred R.
Dixon, Rt. Hon. Herbert	Raikes, Henry V. A. M.	Wolmer, Rt. Hon. Viscount
Emmott, Charles E. G. C.	Ray, Sir William
Everard, W. Linday	Rutherford, John (Edmonton)	TELLERS FOR THE NOES.—
Ganzoni, Sir John	Sandeman, Sir A. N. Stewart	Marquess of Hartington and Mr.
Gritten, W. G. Howard	Scone, Lord	M. Beaumont.

Bill read a Second time.

Bill committed to a Committee of the Whole House for To-morrow.—[Captain Margesson.]