BRITISH SUGAR (SUBSIDY) BILL.

HC Deb 12 July 1935 vol 304 cc637-703

Order for Second Reading read.

11.7 a.m.

The UNDER-SECRETARY of STATE for SCOTLAND (Mr. Skelton)

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

It will not be necessary to make any long introductory remarks in moving the Second Reading of this Bill, for the simple reason that on the 27th June last the House in Committee debated at full length the relevant Financial Resolution, and the Bill contains nothing but what that Resolution itself contained, so that if I were to make a long speech in moving the Second Reading, I should be merely repeating, less effectively, the speech made by my right hon. Friend the Minister of Agriculture in moving the Financial Resolution. The House is well aware of the fact that this proposal is to extend the subsidy for a period of one year at a reduced figure as set forth in the Financial Resolution. Nor do I think it necessary to dwell upon the merits or demerits of the policy of supporting, through Government aid, the sugar beet industry. That is a matter on which much has been said. To-day's debate will, on the other hand, be interesting, because it will be mainly based, as I understand, upon a reasoned Amendment put down by the Opposition. It is the duty of an Opposition to oppose, but I think we may say that this reasoned Amendment, when we look at the language of it, is one which enables people to vote against something which they want to happen. We must regard it as much more important that they should want it to happen than that they should vote against it. I would venture to say that we on this side of the House feel that it is of real national importance that the first words of the Opposition Amendment, namely: whilst opposed to an abrupt termination of the subsidy payable in respect of sugar, should have been placed on record by the Opposition. The other side, I think, fully realise the very beneficial effects that this subsidy in the years of its existence has brought to British agri culture, because that is what it comes to. The subsidy has enabled a new kind of farming to be introduced in England and Scotland, and nobody who knows, as I think every element in the House increasingly knows, the importance of having as many different elements in your agricultural operations as possible can doubt that, looking to the welfare of British agriculture as a whole, it is all to the good really than an entirely new form of production should be added to the production of this country. That, on the widest ground, is an advantage which cannot be minimised, and I venture to add to what my right hon. Friend said on the last occasion my weed of congratulation and real thankfulness that the Opposition do feel the importance, as expressed in the first words of their Amendment, of this subsidy. I do not propose to anticipate what will be said upon the Amendment as a whole. No doubt it will appear, and there will be much argumentation on the point, that the subsidy: has been used to strengthen private monopolies and increase their profits, and that therefore they cannot assent to the Second Reading of the Bill. We will listen to that with great interest, but I do not propose to anticipate that discussion now. It would seem to me that this reasoned Amendment can be described as reasoned on the same principle that Voltaire accepted the definition of the Holy Roman Empire, inasmuch as it was neither holy, Roman, nor an empire. In that sense I am prepared to accept this as a reasoned Amendment; that is, to recognise it as a reasoned Amendment, though I do not accept it in the technical sense. A certain amount was said on the last occasion with regard to wages. It is a fact—and these are the only figures with which I would like to trouble the House for the moment, and they are drawn from page 41 of the Greene report—it is a fact with regard to wages that the statutory minimum wage in beet sugar areas has risen on the average by 1s. 6d. a week.

Mr. T. SMITH

Since when?

Mr. SKELTON

Since the introduction of the subsidy, whereas in other parts of England the increase from the lowest point in England and Wales as a whole has been 1s. 1½d. Similarly, with regard to the question of the number of agricultural workers, as compared with 1924 the decline in agricultural workers in England and Wales is 14.7 per cent., but in those areas where sugar beet was intensively cultivated there has been an actual increase of 4.8 per cent. I think that bears out the contention that there is no crop which involves a higher amount of labour.

Finally, I would like to say, speaking for a moment as representing Scotland, that I particularly welcome the continuation of the subsidy for one more year, pending the announcement of a final and long-term policy with regard to sugar, because in Scotland after a good many years' hesitation, the farmers have at last begun to appreciate the value of sugar beet as a crop, and that increased appreciation has been visible in the increase of the acreage cultivated in the last two years. The increase has been striking. Whereas in 1932 there were only 665 acres cultivated under sugar beet, a very great decline from the start, which was a good one, that had increased by 1934 to 7,536 acres; and under the arrangement whereby the subsidy is to be restricted to the growth of 375,000 acres, that will allow the growth in Scotland of approximately 7,150 acres.

Mr. KIRKWOOD

I would like to ask the Under-Secretary how many agricultural workers are employed on sugar-beet in Scotland.

Mr. SKELTON

I am afraid that I cannot give the figure.

Mr. KIRKWOOD

Cannot the hon. Gentleman give an approximate figure?

Mr. SKELTON

I am afraid I cannot, but I will try and have it worked out, and if the hon. Gentleman will put down a Question I will see whether I can give it. These, I think, are the only observations which I need make, for the interest in this debate is not in the opening speech in moving the Second Reading, but in the speeches that will follow upon the Amendment.

11.16 a.m.

Dr. ADDISON

I beg to move, to leave out from "That", to the end of the Question, and to add instead thereof: whilst opposed to An abrupt termination of the subsidy, payable in respect of sugar, this House takes into account the fact that this State assistance, which was intended to benefit agriculture, has been used to strengthen private monopolies and increase their profits and therefore cannot assent to the Second Reading of a Bill which merely continues the subsidy and fails to ensure that it shall be used to the best advantage of the community. I would call the attention of the House to the concluding words of the Under-Secretary. He said that the interest in this debate is not so much in the speech moving the Second Reading, as in what the Opposition might say with regard to an alternative constructive policy. That is a strange admission for a Government to make. The interest is in the ideas which somebody else can supply them. This is another case of the postponement of the long-term policy. We were trying yesterday under much graver conditions to ascertain the policy of the Government with regard to the League of Nations, and we shall be presented with another example of this intellectual drift on Monday when the House will be asked to vote more millions to give the Government another 12 months to make up their minds what to do about beef. Now we are going to give them another 12 months to make up their minds what to do about beet-sugar. At the end of this exhibition of intellectual apathy we are told that the interest of the debate is in what the Opposition may say. We esteem the compliment. At last the Government have recognised that they depend on the Opposition for suggestions. Let us look at this case for a few minutes, and I will imitate the Under-Secretary and not be very long because we discussed this subject at considerable length only a few days ago.

We know that this scheme, for which the party with which I am associated was very largely responsible in its initiation, was due to come to an end a year or so ago. A Committee was appointed to consider what the situation would be when that event occurred and their report has been in our hands a considerable time. I have no doubt that the Ministry of Agriculture was substantially aware of the findings a considerable time before the public was, and the Government had plenty of time to make up their minds what to do about it because the report is very exceptional in one respect. The majority of two out of three of the Committee reported that, on the whole, it was not worth while to continue the subsidy, but they recognised all the risks that might be attendant upon its cessa- tion, and they presented the Government to an unusual degree with a detailed alternative constructive scheme. It will be found in chapter 10 of the report. There is no reason at all, save intellectual apathy, why the Government could not have given consideration to that scheme and made up their mind what they were going to do about it. There has been plenty of time this summer. The India Bill has absorbed the time of the House a great deal, and the Minister and his friends have had lots of time to sit down, although they have not had for very long the assistance of the noble Lord, the Minister Without Portfolio, whose presence here cheers me exceedingly. Perhaps he will do something which years ago he chided me for not doing, and supply the Government without long delay with an alternative policy on beet-sugar.

However, we do recognise, and our Amendment says so, that serious dangers to what has become a very large ingredient in agriculture in some parts of the country would arise from the abrupt cessation of this cultivation. We suggest in our Amendment that the only practical alternative to that abrupt cessation, the dangers of which we recognise to the full, would be to have a provisional period in which to attempt to get away from the unfortunate circumstances which have gathered round this business so that we can have time to turn round and see whether all this subsidy business cannot be eliminated, and to bring the home producer on to the same terms as those who receive Dominion preference. We cannot expect them to be any worse off. The expectation that that might be achieved is founded on the report. It is because of the justification of that experiment for a short time which the report provides that we put down a reasoned Amendment to the Financial Resolution which, unfortunately, was not in Order, but which appears in abbreviated form to-day. With regard to the question of the agricultural labour employed, which was mentioned by the Under-Secretary, I see that the report puts it at 32,000 altogether. It is difficult to disentangle the figures, but that figure is probably near the mark.

Sir HERBERT SAMUEL

It is not for the whole year.

Dr. ADDISON

We have to remember that that is agricultural labour which is maintained in employment in connection with the cultivation of sugar-beet. The right hon. Gentleman reminds us that it does not apply to the whole year, but it is a substantial long-term addition to employment in agriculture. We should view with dismay the position of this number of labourers suddenly deprived of this opportunity of work, and it is for that, among other considerations which I will mention in a minute, that we adopt the line we are taking. We know the agricultural labourers have no alternative but the Poor Law, and it is risky to do anything which may put an end to months of employment for a very large number of workers, little as we like this business. It is a risk we should not wish to incur if it could be avoided. But, when all is said and done, we have to remember that by the introduction of machinery there has been a steady decline in employment in agriculture. My hon. Friend the Member for Don Valley (Mr. T. Williams) got some figures yesterday about employment in agriculture. During the last five years there has been a decline of something over 50,000 men employed in agriculture. That is largely due to the introduction of machinery, I have no doubt. The report sets out an analysis of this decline, and it can be said truly that the decline is conspicuously less in the beet growing areas. Beet growing has put the brake on the decline, but that is all we can say, because it has not led to an increase in employment; but, such as it is, that is one of the governing circumstances to be taken into account.

A fact which this report brings into lurid prominence is that a great part of this public money has been taken by people who are not employed in agriculture. There is no getting away from that fact. Even since the publication of this report bonus shares and all the rest of it distributed by the beet sugar factories have represented, I believe, not far short of £2,000,000. The amount of subsidy involved in this proposal, over and above the 7s. 9d. Dominion preference, is about £2,750,000. That is not much more than the extra profits distributed by the beet sugar companies since the report was published. Having had these facts before them so long the Government have no right to incur the great loss which this really entails. These factories have done extraordinarily well. We know perfectly well that if we are to have factories to manufacture sugar from beet we cannot expect that the existing system of private enterprise will run the factories unless it can make something out of them, but there are limits, and the profits have been altogether excessive, even exorbitant in some cases. We say the Government have no right to continue this system without putting a check upon this inordinate drain on the public pocket.

We are not now talking as airy Socialists. In this report the House is presented with a constructive scheme for the amalgamation of all the factories into one corporation. If that were in existence, and it is a perfectly practical proposal, as every business man, [...] the House knows, we should immediately get rid of much of this drain. The report shows in striking fashion that there are other opportunities for economy and this involves the action of the Treasury. In 1928 there was apparently re-adjustment of duties, which enable the sugar refiners to operate at an advantage as compared with our British sugar factories. Both sections of the report explicitly condemn the bargain and the rearrangement of duties which placed a premium upon the sugar refining corporations as against our own factories of not less than 1s. per cwt. The result has been that although these factories have installed machinery to refine their own sugar they are not allowed to use it—at least it does not pay them to use it fully—and last year they refined less than half their sugar. If they were to refine their own sugar instead of keeping this machinery idle for weeks it would produce a very large economy. The report says that this ought to be done forthwith.

There has been a large reduction in factory costs in the last four years; they have fallen from 15s. 7d. to 11s. 11d. per ton, and the report says there is every reason to think that decline will be continued. It would certainly be aided substantially if the factories were to refine their own sugar, and this unholy bargain were cancelled. There is another item of economy. There has been a large fall in the price paid for beet, and there is no reason why that fall should not continue. Our agriculturists have now obtained a great measure of experience, they have seed of better quality, and follow better methods of cultivation, and the price paid per ton has fallen from 59s. 6d. to 41s. Every reduction means a reduction in the subsidy. A saving of 1s. per ton on that represents a reduction in the subsidy of about 4d. per cwt. I believe. That is another readily attainable economy. The economies presented to us in this detailed and considered fashion in the report, offer a prospect in the near future of getting rid of the drain upon the Exchequer, and in view of the dangers to agriculture of abrupt cessation the party with which I am associated would be willing to try it for a short time. We put it no higher than that, and we are committed no further than that. That is a constructive alternative policy founded on the report. We should want to tighten up a good many of the things mentioned in the report. I am glad that the right hon. and gallant Gentleman the Member for Ripon (Major Hills) is here, because he is developing into a Socialist. I was delighted to hear on the last occasion his acquiescence in the finding of the report that steps should be taken to control retail prices, although I daresay that we should find ourselves at cross purposes if we discussed ways and means of controlling prices.

Major HILLS

To what section of the report is the right hon. gentleman referring?

Dr. ADDISON

Chapter 10, I believe, although I cannot turn to the paragraph at once. It is in the report all right. I am glad to see it, because it shows that we are getting on. It is a very vital ingredient in this matter. That point brings me to another important consideration, which is the effect which would be produced upon retail prices by the sudden withdrawal of the subsidy and of all this home-grown sugar from the market. This 600,000 tons, more or less, is a big item; it is about one-third of our national consumption. Although imports of sugar, owing to this development, have gone up in a very large and satisfactory degree, the whole business of sugar refinement has increased. Notwithstanding that the world's stocks of sugar are considerable—the stock at the end of the year, as against an average world consumption of 26,000,000 tons, was nearly 7,000,000 tons—that was only about three or four months' supply, compared with the volume of world stocks—not more than four months' supply at the outside. The sugar is on the world market, but it is not here, and the sudden withdrawal of one-third of the stock required for our national consumption might have an immediate effect upon retail prices. That risk would be incurred in the absence of any measure of controlling retail prices, and that has influenced us in coming to the conclusion that it is essential, whatever is done, that the consumer should be safeguarded in regard to retail prices. We are glad that the Commission has recommended that unanimously.

The story that is told of the influence of the great refiners and of the great extent to which they have succeeded in marooning even the British sugar manufacturers, does not inspire us with any great degree of confidence as to what they would do with the consumers if they had them entirely in their own hands, as they would if the 600,000 tons of home-produced sugar were suddenly withdrawn. A very small increase in the retail price of sugar is a big figure compared even with the subsidy. The subsidy, over and above the preference, is about £2,750,000, but a rise in Vile price of sugar of one farthing per pound to the people who buy it for their daily food would represent about £5,000,000 in the annual sugar bill. We have to bear that in mind, and we cannot ignore it. A very serious risk would be run if the nation were delivered into the hands of this powerful, wealthy and very efficiently conducted corporation, whose frame of mind is displayed by their operations as disclosed in the report. I should be very surprised if, in those circumstances, the price of sugar did not go up considerably, and the people who would pay would be the poorest people in the land as well as the richest.

The Labour party would rather the subsidy were paid, if it has to be paid, by some process over which the House of Commons has control, the money coming out of the Exchequer into which it has been paid by the Income Tax and Super taxpayers, rather than it were dupmed on to the tables of all the people in the land. The recommendation in regard to the control of retail prices, which we are glad is supported by the right hon. and gallant Gentleman the Member for Ripon—

Major HILLS

When did I do that?

Dr. ADDISON

I do not want to misrepresent the right hon. and gallant Gentleman, but if he refers to the report of our last Debate he will see that there was a little interchange between us. We regard the control of retail prices and distribution as an essential part of any system of the organised control of supplies, and we are very glad that this Committee recommended it. Behind our Amendment is a constructive scheme based largely upon the report, which we believe we might be justified in trying for a short time, rather than incurring this serious risk of sudden stoppage. We have no right whatever simply to drift on for another 12 months and allow this drain to continue. We have had a little first-hand experience of profit-making at the expense of the State, but I have never seen a more shameless instance than this, and we have no right to allow it to continue when a body of people, after very careful consideration, have presented practical suggestions as to how the case could be dealt with. I do not know anything about the politics of these gentlemen, with the exception of one, whom I know to be a Conservative. I am not sure about the two others, but certainly they are not Socialists; they are not members of the Labour party. They have been driven by the inexorable logic of the situation to propose a national corporation to control prices and so on, and, in default of the Government taking their courage, if they have any, in their hands, and facing up to the position, it seems to me that the House has no alternative but to vote for our Amendment.

Mr. SKELTON

May I be allowed, before the next speaker is called upon, to reply to a question which I was asked as to what years I was comparing in the case of the figures that I gave with regard to the rise in wages? I should have said that the comparison was between the early part of 1931 and the current year.

11.47 a.m.

Sir H. SAMUEL

I listened with great interest to the speech of the right hon. Gentleman who has spoken on behalf of the Labour party, and with intense amusement to his concluding words, in which he taunted the Government with not taking their courage in both hands in dealing with this matter. The position of the Labour party has been simply ignominious. On the last occasion on which this matter was before the House they were unable to summon up sufficient courage even to go into the Lobby. On this occasion, at all events, they have found some method, on the one hand, of endeavouring to maintain the subsidy, and, on the other, of voting against the Government. I see that the Minister of Agriculture is busily taking notes, and no doubt he will be able to make some little debating point with regard to this, but I would draw his attention, and the attention of the right hon. Gentleman who has just spoken, to the last speech which was made on this subject from the Opposition front bench, in the debate a few days ago, by the hon. Member for Don Valley (Mr. T. Williams), who concluded by saying: Having said so much I am satisfied that the whole scheme from beginning to end has been one long ramp It has reached the stage of being a public scandal and one that ought to be closed at the earliest possible moment."—[OFFICIAL REPORT, 27th June, 1935; col. 1383, Vol. 303.] Whereupon he and all his party abstained from voting upon the issue presented to the House. The right hon. Gentleman to-day has spoken of the line which the Labour party are taking on this matter, but I would respectfully suggest that they are not taking a line, but are pursuing a deliberate zigzag. The right hon. Gentleman also quoted various passages from the Report of the Greene Committee and suggested that they gave some colour and support to the policy which he is now advocating. In fact, he based a large part of his speech on the paragraphs in the Report which put forward a considered comprehensive scheme for the organisation of the industry in the future, and anyone not familiar with the Report and with the subject would draw from his speech the conclusion that that was the recommendation of the Committee.

Dr. ADDISON

I am sure the right hon. Gentleman does not want to misrepresent me. At the very beginning I said that, although the Committee made no recommendation, they did put forfard, in the alternative, this scheme. I think I made that quite plain.

Sir H. SAMUEL

Not quite. It was not their alternative. I will read the paragraph which introduces the section of the Majority Report headed "Plan of Organisation and Assistance": We have devoted a great deal of our time to the consideration of the possible lines of reorganisation discussed in the previous chapters. An examination of them was essential for two reasons. First, our terms of reference appeared to require us to advise on the question, whatever conclusion we might come to regarding the continuance of State aid to the beet sugar industry. Secondly, we did not feel that we could properly express a view as to the desirability or otherwise of the continuance of State aid until we had reviewed the possibilities of reorganisation, with particular regard to possible reductions in cost. The Committee, therefore, inserted that long section of their Report for these two reasons: First, that their terms of reference required them to consider what form State assistance should take, if there were to be any State assistance—a purely hypothetical question: and, secondly, because they thought it necessary to examine possible alternatives before they arrived at their conclusion. But their conclusion was specific and definite. The right hon. Gentleman did not quote it to-day, but it has been quoted previously, and it must be quoted again in view of what he said. They said: Since, however, on a review of all the facts put before us, we are unable to find positive justification for the expenditure of a sum of several millions per annum on an industry which has no reasonable prospects of ever becoming self-supporting, and on the production of a crop which, without that assistance, would, at present sugar prices, be practically valueless, we cannot recommend the continuance of assistance. Nothing could be more definite than that, and, therefore, it will be quite clear to the House to-day that that Committee's Report gives no justification for the Amendment which has been moved. The right hon. Gentleman said that he and his friends dreaded the effect of a possible discontinuance of this industry upon the retail price of sugar. But sugar prices in this country are fixed, as the Committee point out, by the world supply and the world demand. Sugar is a particularly mobile product; it is readily brought from any part of the world where it is grown to any other part. The British sugar production is about 2 per cent. of the world's sugar production. In former debates in this House it has always been recognised, and it is clearly stated in the Report, that the retail price of sugar in this country is determined by the world price. The right hon. Gentleman knows quite well that for years past there has been an enormous glut of sugar production in the world, which our own sugar production has made worse, and the sugar-producing countries again and again have come together and endeavoured to form schemes of restriction. What has been called the Chadbourne Plan was adopted by the majority of the sugar-producing countries, and they have cut down their production deliberately in order to maintain a stable market and a remunerative price. These schemes of restriction have almost all, I will not say failed, but their success has been very qualified, and at this moment the present limitation scheme is in a very precarious position. The suggestion that the disappearance of this additional production of sugar which has come into world consumption in the last 10 years would cause a scarcity of sugar and a rise of price is entirely remote from the actualities of the case. I am sure my right hon. Friend, on consideration, cannot possibly stand by that suggestion that there would be a monopoly control in this country and a rise of prices. If such a thing were to come about, it could be remedied in a day by the smallest alteration in the preference that is given to English refiners, who get an undue preference which enables them to establish their monopoly. At any moment, if they raise their prices unduly, this House could alter the figure of the preference, as the Committee recommends, and instantly such an abuse, if it were attempted, could be remedied.

Mr. T. WILLIAMS

Does the right hon. Gentleman suggest that this Govern-merit which granted to sugar refiners their present monopoly would take that monopoly away?

Sir H. SAMUEL

I am not speaking of the present Government. I am speaking of the proposal of the Labour party. The Labour party are making this proposition, and they declare that unless their scheme is adopted there might be a monopoly in this country. I point out that the remedy for that is to secure that this monopoly shall not be maintained. Such an abuse could be remedied in that way.

I can well believe that these recurring debates on the beet-sugar subsidy and assistance cause great discomfort to the Government and their supporters. The matter comes up again and again, and again and again the country is made aware, through the reports of our Debates, that this scandal is going on. This cuckoo which has been batched in the British agricultural nest again and again opens its mouth wide—it is a bird with a most voracious appetite—and again and again the Minister of Agriculture, the unfortunate willow-warbler in whose nest the egg has been laid and hatched, has to come with fresh nutriment for this greedy bird. Naturally, he desires to find some other means of giving the same help to this industry without involving this continuous Parliamentary publicity. It seems impossible that after all these years of controversy any new thing can be said or any new factor introduced, but the right hon. Gentleman and some of his friends have succeeded in achieving even that, and they have been driven to adopt an entirely new economic doctrine with regard to the sugar subsidy in order to endeavour to find some alternative scheme of giving the same money in a different way.

We can foretell in the speeches made by the Minister of Agriculture, by the right hon. Gentleman the Member for Sparkbrook (Mr. Amery) and by some representatives of the agricultural industry just what is going to happen. The Government in all probability, unless there is some change of policy, will say, "We must maintain this industry. The subsidy is certainly an abuse, and we propose, therefore, to relieve the industry of taxes." They will, as a matter of fact, receive about the same £6,000,000 a year as they do now, but it will not be necessary to come to the House year by year for Estimates and Supplementary Estimates and for an actual grant. I say this because the right hon. Gentleman the other day clearly propounded this new doctrine, and it is a novelty. The controversy has gone on for 10 years, and we have never had this put forward before. I will quote the right hon. Gentleman's words. They are likely to prove extremely im- portant in the future development of this controversy: He said on 27th June: If the Committee votes this £2,750,000 for which I am asking to-night, I give it my word not to go in for extravagant adventures, not to give it away to great companies, to Tate and Lyle or to the beet-sugar factories, but I will promise, so far as £2,280,000 is concerned, to go immediately round to the Treasury and hand it to my right hon. Friend the Chancellor of the Exchequer. I cannot say fairer than that. That leaves about £470,000, and it brings down the figure of £20,000 a day considerably; it brings it to a figure of £4,000 a month. There is a great difference between the two— Sir H. SAMUEL: Does the right hon. Gentleman seriously contend that that is the burden on the State of this beet-sugar subsidy? Mr. ELLIOT: Certainly."—[OFFICIAL REPORT, 27th June, 1935; col. 1386, Vol. 303.] He therefore says that the present burden on the State is the subsidy minus the Excise Duty paid on the sugar in this country, the difference between the two being about £400,000 a year. We say, on the other hand, that the burden on the State is the subsidy plus the advantage that the industry gains and the disadvantage which the Exchequer suffers by the industry paying only about half the tax upon the sugar which would have been paid if that sugar had been imported from a foreign country. That is the clear difference between us. We say that the burden on the State is about £6,000,000 a year, and the right hon. Gentleman says it is about £500,000 a year. That is, of course, exceedingly ingenious, and, if the right hon. Gentleman could get away with it, he will no doubt be able to persuade the House and the country that this is a very small sum in order to give such a considerable measure of employment, and that, I believe, is the line the Government may take in the future. I say this is a new doctrine which has never been advanced before. When the Board of Agriculture presented a report in 1931 upon the industry, they presented tables showing the State assistance to the industry, and those tables in adjoining columns gave, first, the subsidy, and second, the rebate of taxation and then the total—exactly what we have been saying. The Greene Committee report does exactly the same thing, and the Minister of Agriculture and every representative of the Government who have answered questions on the subject have until now done precisely the same. There have been a series of questions put to the right hon. Gentleman year after year. I will take first, one addressed to him on 14th February, 1933, by Mr. Campbell. The answer given by the Minister of Agriculture was: The amount of assistance given to the beet-sugar industry during the period 1st April, 1928, to 31st December, 1932, was approximately £22,379,000, comprising £17,061,000 direct subsidy paid under the British Sugar (Subsidy) Act, 1925—including the sum of £183,300 advanced under the British Sugar (Assistance) Act, 1931—and £5,318,000 representing the difference between the amount of duty collected on home-grown sugar calculated at the appropriate Excise rate and the amount which would have been paid had duty been charged at the basic rate for imported unrefined sugar."—[OFFICIAL REPORT, 14th February, 1933; cols. 801–2, Vol. 274.] That admits our contention. The right hon. Gentleman himself defines the assistance given by the State to the industry under these two heads and with that total. The Chancellor of the Exchequer was asked a similar question on 14th February, 1934, and the reply was this: The total amount of State assistance given to the beet-sugar industry in subsidy and revenue abatement, from 1924 up to the present year is £39,631,000."—[OFFICIAL REPORT, 13th February, 1934; col. 1756, Vol. 285.]

The MINISTER of AGRICULTURE (Mr. Elliot)

Does the right hon. Gentleman suggest that there is any discrepancy between that and what I said on 27th June?

Sir. H. SAMUEL

Not only do I suggest discrepancy, but I say they absolutely contradict one another.

Mr. ELLIOT

I am glad to know the point on which we join issue, and I shall have great pleasure when I reply in explaining that these two statements square with each other.

Sir H. SAMUEL

Only if you can square the circle—not otherwise. The argument addressed by the right hon. Gentleman the Member for Sparkbrook was to the effect that everything has been altered by the fact that we now have a tariff and that, while this was quite true before we had a tariff, now it is entirely different. So that up to the year 1931—the subsidy came into existence in 1924—every year the industry received (a) a subsidy and (b) rebate of taxation, total £5,000,000, £6,000,000, 27,000,000 or what- ever it may be. After the year 1931, if you please, as soon as we established the tariff in this country, the assistance to the industry must be regarded as having gone down to something like that amount which the right hon. Gentleman now says is all that they receive. What happens when the Chancellor of the Exchequer makes up his accounts at the end of the year? What happens then? How does Tie regard it? The fact of the matter is that through this industry the Exchequer is the poorer this year by £6,000,000, not by £400,000. If the beet-sugar industry did not exist, the Exchequer would be £6,000,000 richer, and the Chancellor of the Exchequer in his annual accounts would have that sum to his credit. You cannot alter arithmetic by declaring a political principle, and the fact that we have changed our fiscal policy in this country does not alter the realities of the national accounts. Suppose that this industry were stopped tomorrow, or suppose that the right hon. Gentleman instead of coming down to this House for a continuance of this subsidy, were to say, "We have changed our policy and in future there will be no subsidy and British sugar will have to pay the same duty as foreign sugar." Of course, there is a preference also on Dominion sugar. That also is a charge upon the Exchequer. But suppose the whole scheme were to stop, what would the Chancellor of the Exchequer say in his next Budget speech in regard to it?

Dr. ADDISON

May I interrupt?

Sir H. SAMUEL

May I finish my argument first? The Chancellor of the Exchequer would come to that Box on Budget day and would say: "I now have to inform the Committee of Ways and Means of the results of the change of policy with regard to the subsidy of the sugar-beet industry. The State has decided now to discontinue assistance and, of course, that greatly affects my Budget. On the one hand, I save £2,500,000 in subsidy, and, on the other hand, the sugar revenue will be increased by £2,750,000, that being the amount of preference which was granted on the sugar produced in Great Britain, and consequently I have a sum of between £5,000,000 and £6,000,000 to the good, and I have that amount which I can add to the relief of the taxpayers' burden."

Colonel Sir EDWARD RUGGLESBRISE

What is the loss of Excise?

Sir H. SAMUEL

He loses £2,000,000 on the Excise, but he gets £4,750,000. I am obliged to the hon. and gallant Member; he is quite right. The £2,750,000 is the difference between the Excise and the Duty. I should have made that quite plain, and I am grateful to the hon. and gallant Member. He would have had to make it more plain and clear and have said, "I gain so much by not having to give a subsidy, and, with regard to the Duty, I lose £2,000,000 in Excise but gain £4,750,000 in Customs. Therefore, I am £2,750,000 to the good as far as this is concerned, and I am over £2,000,000 to the good on the subsidy and, therefore, I have between £5,000,000 and £6,000,000 which I can devote to the relief of taxes." No Member of the House can deny that. If my right hon. Friend speaks, he will not be able to deny that that would be what the Chancellor of the Exchequer would have had to say so far as the fiscal aspect of this matter is concerned. He might have gone on to say further, "There are certain indirect consequences, and I may have to find more for unemployment", or that the agricultural industry may suffer in this or that way. That is something which can properly be taken into account. We must argue those considerations on their merits, and, if a case can be made out under that head, let it be put off against this expense. I have always said that we must consider employment as a setoff, and the question is to what extent it is a set-off. But as far as the financial aspect of the question is concerned, the fact is irrefutable that the financial burden on the State now is not £470,000 but a sum approximately of £6,000,000.

Dr. ADDISON

I am anxious to understand the right hon. Gentleman, and may I ask him this question? The calculation he is now presenting includes the 7s. 9d. per cwt. which is the Dominion preference. In one form or another the calculation he has presented includes that, and I want the right hon. Gentleman to tell us whether he suggests the 7s. 9d. preference should be continued for the Dominion sugar and withdrawn from the home producer?

Sir H. SAMUEL

No, Sir, I was not referring to the Dominion preference in that sense. The figures which I gave did not relate to Dominion preference.

Dr. ADDISON

They included it.

Sir H. SAMUEL

No, they did not include it. I will answer the question of the right hon. Gentleman. The figures which I gave did not refer to Dominion preference. I was referring to the amount of Excise raised upon British sugar and the rates of duty upon foreign sugar, and I said, by way of parenthesis, that as far as Dominion sugar is concerned there is State aid there also, because the Dominion producers gain under our present fiscal arrangement to a considerable extent. If the right hon. Gentleman says, "I am prepared, as far as the beet-sugar industry is concerned, to grant a preference similar to that to the Dominions", that is a matter to be debated on its merits. But the fact that they would be receiving a sum of money is certain, and my point is that if the English sugar industry had never come into existence the country would have been the richer as far as the Exchequer is concerned by the amount which I have mentioned. I quoted on the last occasion and I hope that I may be allowed to repeat it, as it is only a sentence, one observation in a leading article in the "Times" newspaper last year in which they said: If the sugar had been imported, the Exchequer would have received considerably more in duties and would not have had to pay out any subsidy at all. So that it is absurd to say that the Chancellor of the Exchequer should regard this excise duty as if it were a benefaction to him, giving him £2,000,000 towards his revenue, and say, "Here is a splendid industry established in this country which not only gives this employment, but presents to the Treasury over £2,000,000 in taxation," whereas if the industry had never existed the sum yielded to the Exchequer would be, not £2,000,000, but about £5,000,000. So far from its existence contributing to the relief of taxes, it is a most heavy burden upon the taxes. I have gone at some length into the matter because this is the first time it has seriously been put forward this year, and as it will probably occupy the leading place in the controversy in the future, it is to be treated with some thoroughness.

I can deal much more briefly with one or two other points. Of course, this industry gives employment and additional employment—no one has denied that fact—but not very much additional employment because, as the Greene Committee pointed out, if this crop were not grown, other produce previously grown on the same land, and largely other root crops, would, to a great extent, be produced. But at most the actual employment given in the factories and in the fields is 20,000 man years. I think that that is an excessive figure, and that it is very considerably less, but for the sake of argument, and to be on the safe side, I put it at 20,000 man years, because the greater part of the labour, as we know, is only employed at harvest time for a few weeks. The cost, I assert, is in the neighbourhood now of £6,000,000. If you regard it from the point of view of employment, you find that, if £6,000,000 is taken in relation to the men employed for a whole year, 20,000 man years, that means £300 per annum per man employed is the cost of this employment to the State. If the country were to give a subsidy, say, of £1 a week to any men employed in order to help their employment, it would be thought a very large expenditure and a very onerous burden, but if you take the total cost to the State, on the one hand, and the total employment given in this industry on the other hand, and put them side by side, it is an expenditure not of £1 per week, but of practically £1 on every working day. Three hundred days, taking away Sundays and holidays, is a fair working year, and £6,000,000 for 20,000 men is £1 a day for 300 days in the year. If the country were to give all those men now employed 10s. a day to stay at home in idleness, the taxpayer would save £3,000,000 a year.

Of course, hon Members in whose constituencies this money is spent, welcome it, and, naturally would be very disturbed if it were to cease, and one or two hon. Members for Scotland, particularly the hon. Member for East Fife (Mr. H. Stewart), are the spokesmen for the continuation of this wanton expenditure, and the Under-Secretary of State for Scotland to-day has put forward a plea on behalf of the Scottish industry. The Scottish industry is not very success- ful, and, in order to be maintained, subsidies and rebates of taxation have had to be continued at a very high level. Because these less efficient factories are to be kept in existence by the State, the amount of assistance given to the industry is such that enormous subsidies are paid to the more efficient factories in the Eastern counties of England, with the result that the Anglo-Dutch group has reaped enormous profits, of which the House is aware. The figures were quoted in the "Investors' Review" a few days ago: In the House of Commons this week the Minister of Agriculture stated, in reply to a question, that the total subsidy paid under the British Sugar (Subsidy) Act, 1925, and subsequent legislation to the four companies in the Anglo-Dutch group up to March, 31, 1935, was £11,875,000. In addition, of course, they get the benefit of the rebate, which is many millions more: These companies are the English, the King's Lynn, the Ely and the Ipswich Sugar Beet companies.

Mr. MACQUISTEN

Does the right hon. Gentleman know who wrote that article?

Sir H. SAMUEL

This was a reply given in this House.

Mr. MACQUISTEN

The article was written, I believe, by an hon. Friend of the right hon. Gentleman.

Sir H. SAMUEL

I was not aware of that, and am very much surprised to hear it.

Major Sir M. McKENZIE WOOD

It is not true.

Mr. MACQUISTEN

All I know is that the hon. Gentleman sent me the article, and as it was a proof and he appeared to be revising it I assumed he had written it.

Sir H. SAMUEL

Appeared to be revising! The hon. and learned Member dares to get up and say on such evidence as that that it is written by one of my hon. Friends. What an extraordinary statement. The hon. and learned Member is well known as one who makes most unreliable statements, and this is one of the very worst. I was quoting from a Parliamentary answer given by the Minister of Agriculture in this House. Those figures are quoted in the article, which goes on to say: These companies are the English, the King's Lynn, the Ely and the Ipswich Sugar Beet Companies, and at March 31 last they had an aggregate issued capital of £1,800,000. Since their formation about 10; years ago they have paid tax free dividends of no less than £1,946,000. That means with income tax a sum of about £2,500,000. In addition, three of the four companies have recently repaid capital, out of their cash resources, to the extent of £740,000, while profits have been so large that the factories stand in the books at purely nominal figures. Those are facts well known, and have been made public again and again. All this is at the expense of the taxpayer. This House, which is supposed to be the guardian of the public purse, has authorised all this expenditure, and to-day is going to authorise its continuance. British beet sugar is sweet, but it is certainly not savoury, and will not become more savoury, if, instead of these subsidies being openly paid year after year and discussed in Money Committees of the House, the same money is to be privately slipped into the hand, without public debate, in a quiet corner, which is, apparently, what is now proposed. Instead of having these continual discussions for sums of money granted, the excise duty is to be lowered to an equivalent amount, and the money, without the notice of the House, will slip quietly into the pockets of the same industry.

The Minister of Agriculture, whenever this matter is debated, runs to earth, and takes refuge in a discussion of the wheat subsidy and statements of ray right hon. and gallant Friend the Member for Caithness (Sir A. Sinclair) when Secretary of State for Scotland. That may be very clever debating, but it does not convince when we are dealing with a sugar subsidy and the wanton flow of expenditure for this purpose. He is also accustomed to quoting in every one of these Debates that one member of our party is a supporter of this subsidy. I could quote several members of his party who are opponents of it. Both of those points may have some relevance, but they certainly ought not to influence opinion in the House of Commons on this issue. Finally, my right hon. Friend is always accustomed to end his speech with a peroration to the effect that because of my antiquated doctrines of a previous century, I am opposed to all assistance of every kind, and, therefore, whatever I may say ought to be discounted because it is the outcome of general considerations which are not accepted universally in this House. It is not my fault if general considerations coincide with common sense, but I submit that my case should be accepted on merits, and apart altogether from any general considerations on one side or the other.

Perhaps, however, my right hon. Friend will not suggest that this applies to the Greene Committee, a tribunal chosen by the Government itself, irrespective of any fiscal opinions held by members of that Committee, a body bringing an impartial view to bear upon the whole subject with due regard to their public reputation and their conscientious performance of the duty imposed upon them, and who, on the evidence by a majority of two to one, report that the expenditure is not justifiable, that the industry cannot become self-supporting, that the expenditure is far too great, that the assistance ought to be discontinued, and suggesting that this should be gradually done. If a brief term were fixed no one would object to the recommendation of the Committee that the decline should be gradual until the assistance ceased. This House is responsible in the matter. It cannot evade responsibility by putting it on to the Government or anyone else. This lavish expenditure, which has been going on for the past 10 years, and now reaches a total of £60,000,000, is the direct responsibility of the House of Commons, and the House to-day will have to decide whether this lavish expenditure is to continue for yet another year.

12.24 p.m.

Mr. AMERY

I will attempt the difficult surgical operation of trying to get into my right hon. Friend's head a point of view which may be new to him, but which, I contend, is obvious common sense, namely, that if you give a person a subsidy which you at the same time take away in the form of excise, you are, in fact, giving him nothing, and only putting him in exactly the same position as if he were subject to a protective duty of the same amount. It would be quite different if this were an excise paid by somebody who was in any case going to produce the article, and was then surprised afterwards that the excise was given back. The fact of the situation is that this excise would not be paid, and could not be paid, unless it was given back again. It is a purely artificial, hypothetical transaction. The other day the right hon. Gentleman indulged in a delightful whimsical flight of fancy when he described the visit of the Minister Without Portfolio to Buckingham Palace in order not to receive a Portfolio. He described the Portfolio being carefully handed to him and then taken away. To my mind the position of most of this so-called subsidy is exactly the same. I do not think that any one who looks at the matter from the point of view of what actually happens to the industry could deny that the position is exactly the same as if the industry were protected to the extent of 4s. 7d. and given a 5d. subsidy.

Mr. ISAAC FOOT

Why was not that mentioned by the Greene Committee?

Mr. AMERY

It was not mentioned because, apparently, the Committee had not the intelligence to appreciate it. The majority of the Committee were as thickheadedly free traders as the right hon. Gentleman. The position is a perfectly plain, commonsense one—what is the difference between an Excise which is nominally collected and then nominally given back again and the giving of no subsidy with the imposition of a corresponding duty? My right hon. Friend will say that the Treasury loses money and that the burden is placed upon the consumers of the country, which means a burden upon the nation. That is only true on the old Free Trade assumption that every duty is paid in full by the consumer and is therefore a burden on the consumer. It is the old Free Trade argument that you ought not to impose any duty without a corresponding excise, otherwise the duty is paid by the consumer. We have, however, had some years of Protection during which we have had time to learn that that argument is not true and that the consumer does not pay the whole of the duty. He does not always pay the duty. In the conditions of the world to-day he very rarely pays any of the duty.

Sir H. SAMUEL

He pays it on beet-sugar.

Mr. AMERY

I will come to the question of sugar in a moment. Our general experience in the last few years since we have had protective duties has been that the bulk of those duties are paid by our foreign competitors in order to get into our market. One of the proofs of that is the fact that the imposition of the duties has not caused a rise in prices. The reason why the duty is not being paid by the consumer of sugar is that the incidence of the duty in developing the home industry exercises a very important reaction upon the price which the foreign producer is able to demand, and that depends to a large extent upon the volume of home production as an alternative to the foreign production which is seeking for a market at almost any price.

My right hon. Friend, using his figures not altogether ingenuously, suggested that our production of beet sugar could have no appreciable effect upon the price of sugar, as it was only 2 per cent. of the world's production. Yes, but the world production, as the Greene Committee pointed out, is almost entirely in water tight compartments and the really free world market is only a minute fraction of the total world production. The Greene Committee, in the earlier part of their document which was written on the facts and not on Free Trade prejudice, point out that the total world market for sugar is less than 3,000,000 tons, of which 2,000,000 tons is the market in this country. Therefore, a production of 600,000 tons in a world market of less than 3,000,000 tons is not 2 per cent. but more like 22 per cent. of the supply. That increased supply in a congested world market has a very decisive effect. Surely no reasonable person would deny that 22 per cent. of the world market for sugar being produced in this country must have a very material and very great effect on the price. The present so-called world price of sugar is under 5s., about one-third of the price in most of the markets in the world and less than half the cost of production in practically any market in the world. To say that that price has not been affected by the production of British beet sugar and would not be materially altered by the withdrawal of that production is entirely against commonsense.

I contend that the Government of this country so far from losing heavily on the beet sugar situation, even though they may have spent something approaching £19,000,000 in setting up the industry—that is the true figure, which was given by one of my hon. Friends the other day, in an admirable speech—have been the gainer and the nation has been the gainer substantially. We are getting sugar cheaper than we otherwise should and we are getting, in addition, a large volume of production measured not only in money but in what it means by creating in this country a new type of industry, new energy, new enterprise, and in having saved agriculture from the disastrous competition which it would have suffered if those 400,000 acres had been thrown into competition with the dairying or meat production side of the industry.

Let us suppose that the industry were scrapped to-morrow. The Chancellor of the Exchequer, according to my right hon. Friend, would be able to come forward next year with his Budget and say: "My revenue is more than £6,000,000 larger, gross, or £4,000,000 to £5,000,000 nett, and I am going to distribute that for the benefit of the public." But what he would also have to say would be this: "Owing to the withdrawal of the production of 600,000 tons of effective competition in the sugar market the price of sugar in this country has gone up by one halfpenny per pound, and the public are paying £10,000,000 or £15,000,000 a year more for their sugar." He would have to mention the fact that we had scrapped an important industry, together with the subsidiary industries. He would also have to mention all the assistance which those industries had been to agriculture, which assistance had been withdrawn. He would also say that the scrapping of those industries had had a disastrous effect upon the whole agricultural situation and that as a result he had to find not only doles for the people immediately concerned in that industry but to provide other measures of relief for the Dairy industry and to give a bigger subsidy for the meat industry.

Let me take the logic of my right hon. Friend's argument a little further. From the narrowest point of view, from the old Free Trade point of view, whenever you bring in an article from outside and do not produce it here and you put an import tax upon it, then you have revenue and all is well. Let us see to it then, that an effective Excise Duty is put on every British article produced in this country to balance our import duties and that all purely protective duties should cease; better still, let us import everything from abroad and produce nothing. How wealthy the Exchequer would be and what millions could be distributed among the poor! That is the logical conclusion of the right hon. Gentleman's argument. I say, let him face the fact that the protective system in this country has paid us and that nobody dreams of going back on it. In this one instance, owing to the fact that protection was started in practice before we were committed to it the pretence was made of keeping to the old system by levying an Excise duty and giving it back to the producer. It was mere make believe, but the fact that it has been kept up during all these years has caused an infinite amount of waste of time in this House, measure after measure having to be brought in, and an infinite amount of misunderstanding. Even the right hon. Member would not have so completely misunderstood the situation if in 1931 we had straightway converted this to an ordinary protective duty. He would no doubt have included it in his general objection to duties, but he could not have singled it out as a "scandal" and an "unsavoury" proposition.

All this talk about the scandal of subsidising wealthy manufacturers is all moonshine and has arisen from the inability of people to see that here is an ordinary case of protection, in the main, which is veiled under the pretence that you are taxing sugar and giving the tax back again. Let me say a word more on this question of "scandal." Whenever an ordinary protective duty is imposed the whole country rejoices in the success of the industry, not only of the workers concerned but of everybody else. If capital in this new industry makes good while employing British labour it is another triumph of the tariff; and we know that the profits that are being made are, rightly, substantially taxed. If foreign capital comes in and starts new enterprises and employs British labour it is another triumph of the tariff. But just because this thing has been called a subsidy and has not been treated as ordinary protection, which is what it is, we hear all this nonsense about scandal and corruption. In Heaven's name let the beet-sugar industry be carried on on ordinary business lines as an ordinary protected industry. The one thing that has impressed me most—and this is my last word—is the amazing power of a mere word, such as "subsidy," to delude the public.

12.39 p.m.

Mr. TINKER

I want to say why to some extent I agree with the right hon. Member for Sparkbrook (Mr. Amery) and disagree with the right hon. Member for Darwen (Sir H. Samuel). It is difficult to understand the position of hon. Members below the gangway on this matter. The Under-Secretary of State said that although we had put a reasoned Amendment on the Order Paper our hearts were not in it; that we think the subsidy ought to go on but, being an opposition, it was our duty to oppose. That is not my position. I am not in favour of a subsidy being paid to any private enterprise without there is public control. It may be necessary for us to look out for industries which are in need of assistance. An industry may not be able to hold its own with competitive industries abroad and it may require some help from the State to put it on its feet. Under a Socialist Government that would be necessary, because there are various industries which are liable to fail not because of any lack of incentive but owing to overseas conditions, and it may be necessary for us to see that they are not allowed to go out of existence.

I was in the House when Lord Snowden advised the Labour party to support this subsidy. There was a strong difference in the party, but wiser counsels prevailed, and it was thought necessary to do something in the matter. The grant has been continued from time to time, but I say that while it may be necessary for the State to help an industry it is essential, when the State does so, that it should have absolute control as to how the money shall be spent. Wherever money is given in that way, it may be in a very indirect way, I say that the State should have control. Having once interfered with an industry it is the duty of the State to continue its supervision. If it is found that the industry is making enormous profits there must come a time when the State should say that the subsidy must stop. It should not be allowed to go on. The Labour party is placed in this unfortunate position. We have agreed to the subsidy and we know that it has meant the employment of more workmen than would otherwise have been employed. If we cut off the subsidy immediately we are faced with the fact that we shall add to the volume of unemployment. That is a serious matter. We are anxious that employment should be kept up: we do not want anyone to be put out of work. We have helped to build up the sugar beet industry and many of the workmen engaged in it look forward to us to continue the assistance. In that case we have a right to say that the time has come when it should be under public control.

This is where I differ from the Liberal party. They do not tackle the whole question. They say that we have no right to give any subsidy, but if we do they do not then contend that there should be public control. I want to put this question to them: do they admit that any industry at any time should be assisted by the State? There must be times when an industry requires help from outside. I put it to the Liberals, have they at any time in their policy said that industry wants help at all? Take the coal-mining industry. It is a competitive industry. To give the miners the wage that they ought to get the price for overseas coal would have to be raised. There are only two ways of doing that, either by putting up the price, in which case there might be no sale 'at all, or by means of a levy. I can see the time coming when the State in order to give to workmen in any industry the rights to which they are entitled will have to face one or other of these things. It is for the Liberal party to examine the question from that point of view.

We are opposing this proposal on principle. It may be said that it would be very hard for us if we carried this Amendment, but we cannot now or at any time allow public money to be given in this way without raising our voice in protest unless public control goes with the grant. The Home Secretary the other night made great play with a pamphlet embodying the criticism of our party on the subject. He had a perfect right to make great play with it. In that pamphlet the argument is that where subsidies are given we should take over the control of industry; and we say also that the time is opportune for the State to take over various industries. I say to-day that we would be well advised to take over the sugar-beet industry and to work it for the benefit of the State. It should be publicly owned and controlled. On the merits of the question whether this country is in need of sugar, or whether it could get what it wanted from overseas, I am not prepared to argue for the moment. There are many hon. Members who are far better fitted than I am to deal with that question. All I want to deal with is the underlying principle of our Amendment—that we as a Socialist party must protest at all times against public money being given to private enterprise.

I have here a long list of huge fortunes that are being made in various kinds of industry. If any one of those industries happens to strike a bad time and the State has to come to its help and provide money for it, does it not strike everyone that it is unfair for the State to be handing out money knowing that later huge fortunes are to be accumulated in that industry? That is my point, When industry requires State assistance the time has come for the State to step in and to exerdise public control for the benefit of the whole community.

12.50 p.m.

Sir ALAN McLEAN

The House has looked at the sugar-beet industry from many angles. I want to look at it from the point of view of those concerned in the agricultural industry, the farmers, smallholders and agricultural workers. It is a factor in the situation and not the only factor, but one that the House ought to consider. I believe that if this assistance to the sugar beet industry was suddenly discontinued, if, in the words of my right hon. Friend the Minister of Agriculture, the head was cut off, we in the Eastern counties would be face to face with what would be nothing less than a disaster to agriculture. Of the total acreage of sugar beet in this country about one-quarter is in the county of Norfolk, and if you take the adjoining counties of Suffolk, Lincoln, and the Isle of Ely—I am glad to see that the hon. Member for the Isle of Ely (Mr. de Rothschild) is present—they produce about two-thirds of the sugar beet grown in this country. In the heart of my own constituency there is a factory, there is another at King's Lynn in the North and another at Ely in the South. To those factories and to that at Cantley one or other of my constituents is sending his sugar beet year after year. The Greene Committee in their Report draw attention to the fact that if we take the agricultural holdings exceeding five acres in extent in those four counties, about 52 per cent, grow sugar beet. I have not the least doubt that in my own division the proportion is substantially higher. It is therefore a matter of vital concern to my constituents what happens to this industry.

In the debate on the Financial Resolution a short time ago some speakers alluded to the cost of this industry, notably the right hon. Gentleman the Member for Darwen (Sir H. Samuel). Of course, whatever that cost may be it is possible that if 10 or 12 years ago we could have seen the exact course of world trade we would have made the investment in a different way. Many of us, I suppose, if we knew what the events in the world of trade were to be 12 years hence would make investments far more profitably than we can now. But that is not the practical question that we have to face. We have to consider what we are to do in the conditions existing now. When the sugar beet industry was first started it was helped largely by a remission of the excise duty. When the Labour Government were in office in 1923 they felt that, although the industry needed help, in a free trade country that was not the proper way to do it, and they suggested a subsidy. When we came into office in the following year we felt too that in a free trade country it was probably better to help the industry by a subsidy rather than by protective measures. But we are no longer a free trade country; we are a Protectionist country, and it does not at all follow that in our permanent policy we ought to confine ourselves to the remedy of a subsidy. In fact I hope we shall find some other way. The right hon. Member for Darwen pointed out that the Greene Committee recommended the discontinuance of this industry. They recommend that farmers should turn to some alternative crop, but they are painfully silent as to what that crop should be. They do mention potatoes.

Viscountess ASTOR

Oranges, bananas.

Sir A. McLEAN

That is not practical. The Greene Committee do suggest potatoes. But this House knows perfectly well that we are already producing all the potatoes we can profitably produce, and that in the last year or two we have had to get rid of the surplus by riddling out the small potatoes, and last year some of the excessively big potatoes. If we turn to other root crops such as mangolds, swedes, turnips and so on, as my right hon. Friend the Member for Sparkbrook (Mr. Amery) pointed out, that root crop would be used for the purpose of livestock production, and at this moment a great increase of livestock production would add enormously to the difficulties of my right hon. Friend the Minister of Agriculture. But this question of an alternative crop is vital if the majority Report of the Greene Committee is to be accepted. Although they have not definitely suggested what alternative crop should be grown and what the loss would be, they have no hesitation in defining exactly what subsidy should be given in the next few years to compensate growers for their loss. It is £3 an acre for the first year, £2 for the second year, and £1 for the third year. I do not know what is the basis of that calculation. Sugar-beet at the present time on many farms and smallholdings is only one crop in the arable rotation.

If that crop goes without an alternative it is not a question of doing away only with the sugar-beet crop but with all the crops on that holding. Only a short time ago this question was considered by the Smallholdings Committee in Norfolk. They point to the fact that in Norfolk we have 30,000 acres let in smallholdings—we are proud of the fact that Norfolk is a great smallholdings county—and that there are 2,000 tenants growing 6,000 acres of sugar-beet. The Committee further point out that the withdrawal of financial help would be disastrous to the arable counties: that it would cause large numbers of smallholdings to be given up, with consequent difficulties as to letting and loss of rent, in addition to widespread unemployment among the agricultural workers and a heavy call on the council's finances for public assistance.

Mr. ORR-EWING

Can my hon. Friend tell the House what rent would be lost—in fact, what rent is paid at the present time in Norfolk for these 6,000 acres?

Sir A. McLEAN

The rents vary enormously as my hon. Friend knows. A smallholding in a rich fen district is much more valuable than a smallholding in what we call the high land in Norfolk. The Committee point out that it is a question of the smallholding being given up and the impossibility of letting. At a time when Members in all parts of the House wish to see a great increase in smallholdings, it seems very unpromising to start a smallholdings campaign by producing what would be nothing short of a disaster to smallholders in Norfolk. To suggest to the growers of sugar-beet in Norfolk that they should turn to an alternative crop is almost like telling a coal miner, in the case of a mine which has been shut down because it cannot produce any more coal, to go down the mine and produce an alternative mineral. When we consider the cost of this industry we should also consider fairly what would be the cost if it were discontinued and what is going to be the effect on the arable counties. As my right hon. Friend the Member for Spark-brook (Mr. Amery) pointed out, we cannot produce other crops unless we have something on which we can use them. At present there is no possibility of turning to an alternative crop without adding greatly to our agricultural difficulties all over the country. For those reasons, I support the Second reading of the Bill.

12.59 p.m.

Mr. de ROTHSCHILD

I understand that on this question my political body has been used as a sort of weapon which has been thrust backwards and forwards between the two Front Benches. I should like to draw the Minister's attention to the fact that I am only a very humble Member and that his argument must, indeed, be very feeble if he relies on my support to convince those who are opposed to him. I am flattered by the allusion which he has made to my ample form and I assure him that it is far ampler in his imagination than it is in reality. I can speak on this subject almost with first-hand knowledge because, like the hon. Member for South West Norfolk (Sir A. McLean), I represent a constituency in which sugar-beet is widely grown. What is attracting me at the present time and what should attract the attention of the House is the fact, mentioned just now by the hon. Member, namely the number of smallholders who are interested in the cultivation of this crop. I am not going into the question of the large acreage which is held by bigger farmers in the Eastern Counties. In my own small constituency alone there are 2,000 smallholders under the county council farming on the average 7 acres each, and everyone of these grows sugar-beet. It is no doubt a matter of pride for the Isle of Ely County Council that, they should have on such a small area so many smallholders, and that those smallholdings should pay, but there can be no doubt that if they cease to grow: sugar-beet—by which at the present time; the smallholders are paying their rents—there would be an end to the extension of smallholdings in the Island.

As the last speaker and other speakers in these debates have pointed out, there is really no alternative crop and that is where the Greene Committee did not give the facts due weight. The Committee naturally examined what justification there was for continuing assistance to the beet-sugar industry as such, but I suggest that this House ought to do more than that. I think we must examine this question within the framework of the general agricultural policy of the country and especially the present agricultural conditions. I am not going into details on the question of what the farmer could put in the place of sugar-beet, and whether it should be potatoes or mange's, because as hon. Members have pointed out the production of potatoes cannot be increased at the present time while mangels are only grown for stock and stock is at a discount just now, both milk and fat stock having become unprofitable, no doubt in spite of the great efforts of the Minister of Agriculture, but possibly because of those efforts. But if there is any crop that can take the place of sugar-beet at the present time it can only be wheat, and that only in the case of the larger farmers where the rotation of crops allows it. There can be no doubt that in that case once more the farmer will be dependent on the wheat subsidy which was granted in 1932 by the National Government.

There is a concrete consideration which commends itself to me. Recently Members belonging to all parties have complained bitterly that the Government had been too niggardly in what they were doing for the distressed areas and in the small sums which were being placed at the disposal of the Commissioners. Today I suggest we are granting a subsidy of the same kind. I submit that the subsidy which is here proposed can be regarded as analogous to that payment—that it can be regarded as preventive instead of curative. I do not like subsidies any more than any Member of my party or any Member of the House, and I wish wholeheartedly when agricultural conditions permit to see this and other crops grown independent of State assistance. I do so especially because I doubt whether beet sugar will ever be self-supporting in competition with cane sugar from oversea. Nevertheless, the present situation makes State assistance necessary, and whatever Government was in office and to whatever party they might belong, they would find it necessary either to continue this assistance or to find another remunerative crop to take the place of sugar beet. I firmly believe that any farmer in this country will be only too glad to adopt any remunerative alternative when it presents itself or when the imagination of the Government fostered by the activities of the Minister can devise means of meeting the emergency.

Now let me say a few words about the Labour Amendment. There is no doubt that one cannot help having some sympathy with it. I have often deplored to this House the method by which the subsidy was administered. I have often deplored the scandalous profits of the factories. I certainly dislike most heartily the method of direct payment to the factories which is used at present and which does not give us any control over the growers' share. I wish indeed that this Measure could have embodied a different method of assistance, but for this season, I realise, there can be no alternative scheme for the farmers. After all, the beet that is affected is now grown. The farmers' prices have been fixed months ago. They were fixed after the Minister's promise of the sub- sidy as it is provided in this Bill, and it is obvious that these contracts which have been entered into cannot be changed now.

But if I have some sympathy with the terms of the Labour Amendment, I have no sympathy whatever with its authors. As I was coming up the stairs to this House to-day, I met the right hon. Member for Swindon (Dr. Addison), and I told him that I should have a few words to say about him. I only regret that he has chosen the opportunity of my making this speech for absenting himself from the House. I realise that the right hon. Gentleman is hungry; so are a great many other Members of his party. The right hon. Member for Swindon—whether he is here or not I must say this—was at the Ministry of Agriculture from 1929 to 1931, and during that period the subsidy that was being paid was on a much higher scale than the subsidy that is proposed to-day. It was paid according to the very inequitable system which the right hon. Gentleman's Amendment to-day deplores, and at that time I begged the right hon. Gentleman and his chief, who to-day is Lord Noel-Buxton, to go into this matter with great care. I begged and implored him repeatedly, I pleaded for investigation, with a view to devising a more equitable mode of administering this subsidy. For two years the right hon. Gentleman was content to do nothing.

Mr. T. WILLIAMS

The hon. Member, I am sure, would be the last to wish to misrepresent my right hon. Friend. Is he aware, when he says that for two years my right hon. Friend did nothing, that during the short term of office of my right hon. Friend, he was able to reduce the subsidy by several shillings per cwt., and then only after a terrific battle with the farming interests who were working against him.

Mr. de ROTHSCHILD

The hon. Gentleman is right. It was certainly reduced, but that was the original intention. That had nothing to do with the initiative of the right hon. Member for Swindon.

Viscountess ASTOR

It was the sliding scale.

Mr. de ROTHSCHILD

Yes, it was the sliding scale. I pleaded for investigation, but I got none for two years. During that period the right hon. Gentleman was waiting for a report which was being prepared—by whom? It was being prepared by the representatives of the factory interests. Can you wonder that the factory interests found no fault with the system I Indeed, so little importance did the right hon. Gentleman attach to this report when he got it, that he was not sure who the authors were. He attached so little importance to the factories' profits that on two occasions in 1931 he was unable to tell the House what dividends had been paid by the factories in that year—on one occasion, in answer to a question put to him by the Noble Lady the Member for the Sutton Division (Viscountess Astor). The second occasion on which he said he was unable to give a reply as to the dividends of the factories was two months after the reception of the report, before its publication. The right hon. Gentleman comes here and attacks the factories on their, I agree, immense and considerable profits, but in each of the years when he was in office the factories paid the highest dividend ever paid.

The right hon. Gentleman is having his lunch, but I hope he will read my speech to-morrow. In those years the English beet sugar factory paid 20 per cent. and the Ely sugar factory 12½ per cent., tax free, and also large sums were paid to reserve. In fact, the right hon. Member for Swindon, who was Minister for Agriculture then, is more than anybody else in this House responsible for these dividends. The right hon. Gentleman is also more than anybody else responsible for the huge and inordinate distribution last month of cash bonuses of 60 and 66 per cent. by two companies I wish that the ideas which the right hon. Gentleman described so admirably to-day had germinated a little earlier in the unfertile mind of the Labour party. It might then have been possible to eliminate some of the scandals in the administration of this subsidy. It is too late for the Minister to eliminate the abuses this year, but the right hon. Gentleman himself, as well as his predecessors, is responsible for the situation of to-day, because he failed to inaugurate in good time a thorough investigation.

I am glad that this Bill makes an attempt to calculate the rate of subsidy on a more scientific basis and that no allowance has been made in respect of capital charges and profits. I hope that any future matters which are brought forward by the Government for the assistance of the industry will be carefully thought out, and that the long view planning of the right hon. Gentleman will at least be a little more successful. I hope that he will be able to eliminate the abuses of the present subsidy system, and that he will be able to ensure a greater economy to the Treasury. Lastly, but not least, with all my heart I hope that he will ensure the greatest possible measures of assistance to agriculture, because it was for the benefit of agriculture that the State assistance to the industry was instituted at the beginning.

1.14 p.m.

Major HILLS

I agree with almost everything the hon. Member for the Isle of Ely (Mr. de Rothschild) has said. I agree with him that a subsidy is an invidious way of giving the assistance that he and I want agriculture to receive. By far the best way of giving that assistance is by means of a duty. On that question the right hon. Gentleman the Member for Darwen (Sir H. Samuel) seems to me not to realise the world in which he and I are living. It is a protected world, and this is a protected country. We can produce beet-sugar as cheaply here as many other countries, and if the crop here is assisted, it is in the same position as wheat and beef. The right hon. Gentleman was in a Government which gave assistance to wheat. Why should sugar be the only unprotected agricultural product?

Sir H. SAMUEL

Because it is unsuited to the climate of this country. Sugar cane is the right source for sugar production, and this sugar is unsuited to the climate of the country. That is why it is the worst possible crop to have chosen.

Major HILLS

We can produce it here as cheaply as many foreign countries can, and why cannot it have the same protection as other crops? The right hon. Gentleman would sweep away at one stroke the whole of the industry that has grown up and throw on the labour market the men employed, and his only justification for that is that the Chancellor of the Exchequer would get more revenue. If you ceased all agricultural production in this country and imported all the produce and taxed the imports, of course the Chancellor would get more revenue. If we grew no wheat or beef here and im- ported it, the revenue from the tax would mount up. The right hon. Gentleman does not always see how far his arguments take him.

The right hon. Gentleman the Member for Swindon (Dr. Addison) threw some bouquets at me which I am anxious to return. He accused me of pleading for Socialism. The Amendment which the right hon. Gentleman fathers opposes the abrupt termination of the sugar subsidy, and the right hon. Gentleman moved the Amendment in terms which showed that he wished to preserve the sugar industry. He does not want to scrap the industry like the right hon. Member for Darwen does. I am not sure that the right hon. Gentleman the Member for Swindon is a not good Conservative where the preservation of an industry is concerned, that he does not always allow political principles to stand in the way and that he looks to the immediate future of the country, and, above all, to the preservation of employment. He said that he would view with dismay the labour which is employed in the production of sugar being deprived of work and cast on the dole.

The right hon. Gentleman the Member for Darwen seems to consider that if we got more revenue by a tax on imported sugar it could be spent on the dole and the account would be balanced. The human side is totally disregarded in that argument. The throwing of men out of work cannot be compensated for by putting them on the dole. I want to see a successful sugar industry in this country. I do not want to see exaggerated profits made by certain people, but I want to see the industry that is established here carried on at a profit. The Government have a difficult task in front of them. It is no good the right hon. Gentleman the Member for Swindon girding at them for not having brought out their scheme at once. Is it not perfectly clear that the scheme needs very careful consideration? I shall not at this time go through all the factors that have to be taken into account. We have to consider the price to the consumer, the position of the sugar refineries, the position of the farmers and smallholders, and the position of the beet-sugar factories. All these are big problems and all enter into the question. The right hon. Gentleman the Member for Swindon asks for time to turn round to see if this subsidy business cannot be amended. I entirely approve of those words. All that the Government are asking is time to turn round to see if the subsidy business cannot be amended. I am certain that they are right in asking for it and that it would be a disaster to rush a decision.

1.20 p.m.

Viscountess ASTOR

I am intensely interested in this debate, and I do not think a more interesting subject has hardly ever come before the House. Beet-sugar was the first industrial enterprise of our friends of the Labour party. It was their child, and they have had to keep it going. The hon. Member for the Isle of Ely (Mr. de Rothschild) pointed out that when the right hon. Gentleman the Member for Swindon (Dr. Addison) started it years ago, he was told of the dreadful things that were going on and that he did nothing. Enormous profits were made by the manufacturers when the right hon. Member for Swindon was Minister, and he is the last person who should attack the Government for their policy. Some of the Labour party at that time saw what some of us saw, but they could not vote against their party. We who belong to the National party are in no such position. It is our job in the House of Commons to vote as we think right and to have the courage of our convictions. We know, whenever the right hon. Gentleman the Member for Spark-brook (Mr. Amery) speaks, that whatever the subject on which he talks he is bound to bring in his old tariff reform beliefs. He has not budged a bit. Nobody has ever changed him. Nothing in the world—

Mr. AMERY

The world has come round to me.

Viscountess ASTOR

If the right hon. Gentleman went to the country now with his extreme tariff proposals, he would get the same answer as was given in 1924. I am not dealing with extreme tariff reformers or extreme free traders. They are both wrong. I am not an extremist, and what concerns us as the House of Commons is the question whether we are to go on with the sugar subsidy and whether it is worth while from the point of view of agriculture and the country at large. When the Minister of Agriculture set up the Greene Committee we were very hopeful that at last we would get an unbiased investigation into what some of us have for long regarded as a national scandal. We now have the report, and the Minister says he is not going to act on it.

Mr. SKELTON

No statement has been made about it except that the matter is under consideration.

Viscountess ASTOR

And in the meantime we are asked to vote millions more. Everybody knows that there has been plenty of time for the Government to look into it if they had wanted to do it. They have been frightened to do it because of the vested interest. They have started vested interests which are the most difficult things to go against in the House of Commons. All the Members for constituencies where sugar-beet is grown have to defend it. I dare say I would do the same if it were grown in my constituency. Still, although I represent a dockyard, I have always tried to keep a quite clear view about disarmament, instead of always looking to the interests of my dockyard. However, here we have a vested interest which every Member whose constituents are growing sugar beet feels bound to come here to support, although you cannot honestly defend the industry from the agricultural point of view:

Mr. HENDERSON STEWART

Of course you can.

Viscountess ASTOR

Of course you cannot. The Government give this enormous subsidy because it is said there is no alternative crop. Some of us think that asparagus could be an alternative crop. There is a great demand for asparagus. Thousands of pounds are spent every year on imported asparagus. The people who know could advise the Government about alternative crops, but the Government have never even asked about them. The Minister of Agriculture is entirely in the hands of his officials, and the officials do not know half as much as some of the people outside officialdom. The right hon. Gentleman on the Liberal benches has shown that it cost the State £6 a week for every man who is employed in this industry. Those figures are irrefutable. I am certain that if hon. Members honestly went into this question and then went to their constituents and said "We are paying £6 a week for every man employed in the sugar-beet in dustry "they would soon find out what the country thought about it.

Mr. H. STEWART

That is not so.

Major HILLS

Would they not rather have cheap sugar?

Viscountess ASTOR

Of course they want to have cheap sugar, and we have proved time and again that this subsidy has no part in making sugar cheap. This is the dearest sugar. I ask the Minister to pledge us that he will look into this question with a more open mind, and not with the official mind. Some of us who are interested in agriculture know that it is only a question of time before the people will say "We townsfolk are not going to pour money into an industry which it has been reported will never become a staple industry in this country." The Greene Committee has said that it will never stand on its own feet. The right hon. and gallant member opposite said that he wanted the industry established. Is he willing to establish an industry which will always have to be subsidised?

Major HILLS

Other sections of the agricultural industry have to be subsidised.

Viscountess ASTOR

The right hon. and gallant member knows perfectly well that there must be a limit to these subsidies. Every one wants a subsidy. But even the Minister for Agriculture is not so happy as he was about subsidies, and I am certain that the National Farmers' Union are not so happy about them. They are getting very disquieted about the whole agricultural policy of the Government. They would far rather have a small tariff than subsidies, and I think that is what it will probably come to.

Major HILLS

Will the noble Lady agree that the subsidy ought to be replaced by protection as soon as possible? If so, she and I would be in agreement.

Viscountess ASTOR

I think we shall have to have a small protective tariff, and that will be far better than subsidies—only on certain things, though. I do not think we should have even a small protective tariff on things we cannot grow in this country. That would be absolute foolishness. The whole world has come to see that, and that is why I do not agree with the extreme protectionist. I do not believe the public will agree to protect things we cannot produce in this country, and the report of the Greene Committee tells us that the sugar beet industry is not one that can ever be established here. It is no good saying that the members of that Committee were prejudiced or were Free Traders. We do not know anything about their politics. The Government chose them as honest, just and intelligent men, and their report has told us what to do. But the Minister now says that he must consider it further.

I wish I could stay to the end, but I shall have to go. I should like to hear the President of the Board of Trade, if he were to wind up. I should like to know what his views are about this subject. I do not know what the Labour party are going to do, because they are in a fix. For years we have been telling the Government what would happen if they went on with this subsidy; and I would remind them again that they are supporting a vested interest in which most of the profits are not going to agriculture at all. We have begged them to consider an alternative scheme, but nothing has been done. All the agricultural members support this subsidy, particularly those from Norfolk, and no wonder they support it, because there is no more highly subsidised county in England than Norfolk. I wish the West country was getting more out of the subsidies. We who are interested in other parts of the country where there is mixed farming could tell the Government what to do. I could find them experts who have made money out of their small farms even before there was any question of growing sugar beet. They were making a living on their smallholdings without subsidies.

Mr. LANSBURY

I understand the Noble Lady is going, and that there is good reason for it, but it is unfortunate that on the last occasion when the Money Resolution was before us she did not vote with the right hon. Gentleman.

Viscountess ASTOR

Because on the last occasion also I had to go. That is why I was so anxious to speak to-day. It looks bad in one who takes a strong view to go away without voting, and so I was anxious to enter one more protest. We are all deeply disappointed that so few Members are present to follow this Debate—that vast number of Members whose first duty it is to watch the interests of the country as a whole and not the interests of any particular section of their constituents, especially when this scandal has been going on for so many years and the Greene Committee have told us what course ought to be taken. The Minister of Agriculture can make a very clever debating speech on this subject, with his references to the past careers of his critics. Of course, anybody can make such a speech, because nearly everybody in the House of Commons has got a past and certainly every party has a past.

But let us take the facts as they are. The facts show that this is not an industry which can go on without a subsidy, and we have been told that it ought to be wound up. We know that a good deal of pressure will be put upon the Government to do all sorts of things in the next three or four years, and some of us believe that if they have £6,000,000 to distribute to agriculture they could make far better use of it than spending it in a direction in which very little of it goes to the people engaged in agriulture and a vast amount of it provides profits for people some of whom, it is said, do not even live in the country. I am desperately disappointed that the Minister of Agriculture should follow in the footsteps—not the path, but the zig-zag route—of the Labour party in this matter. We hoped that he would have courage and boldness, and that before now he would have given the House of Commons a plan which we could have adopted, instead of once more asking us to pour millions into a project which the whole country knows will not hold water and is not making sugar one penny cheaper.

1.35 p.m.

Mr. MACQUISTEN

I do not think that her cause has been much advanced by the speech which we have just heard from the noble Lady. I am glad to have listened to it, and to know that the noble Lady recognises that protection is the proper course. Of that there is no doubt in regard to this industry. The reason why the forgoing of the Excise duty, and the small subsidy over and above the preference, are still necessary is because there seems to be world competition in the growing of sugar-beet, and that, with one or two exceptions, every country in the world is giving a larger subsidy than we give, except Java and perhaps Mauritius.

Sir H. SAMUEL

The hon. and learned Member is quite mistaken.

Mr. MACQUISTEN

I know Belgium and perhaps Holland are giving less, but Germany and France give a larger subsidy. We want this industry in our country. The right hon. Gentleman is no doubt correct in some of his figures, but he is unreasonable because he takes the whole figure and does not allow for the Excise. The right hon. Gentleman the Member for Darwen (Sir H. Samuel) quoted an article from the "Investors Review," a corrected proof of which was supplied to me by the hon. Member for the Colne Valley (Mr. Mallalieu) and as the hon. Member had the proof and corrections I naturally thought they were his. I thought it was a very well written article of which the hon. Member has every reason to be proud, and there was nothing wrong about the right hon. Gentleman's quoting it. Therefore, I cannot understand why the right hon. Gentleman gave such a satanic display of ill-nature when I asked about the article, except that it brought out the point the article contained the view, not of the Liberal party, but of a very skilled and very knowledgeable member of that party, whom we are all delighted to hear speak in the House. It is only a fair inference to draw that a man in that position is either the editor of the particular newspaper or the author of the particular article. If I am wrong there was no reason for—

Sir H. SAMUEL

I cannot give any assurance, because I have no idea whether my hon. Friend the Member for Colne Valley (Mr. Mallalieu) wrote the article or not, or had any connection with it. The only point was that the hon. and learned Gentleman interrupted me in the course of my speech and wished to cast discredit because a colleague of mine had written those words. I do not know for what other purpose the hon. and learned Gentleman could have had for interrupting me.

Mr. MACQUISTEN

I did it for the purpose of explaining to the right hon. Gentleman that he ought to pay much more attention to it than if it had been writen by an ordinary Member of the House.

Sir H. SAMUEL

It did not sound like it.

Mr. MACQUISTEN

I think the right hon. Gentleman might have been a little less ill-natured in dealing with my statement. In regard to the duty, why should we allow to compete with us sugar which is produced abroad at a loss and below the cost of production? Javanese sugar is grown by men who work for 5d, a day. Do the Liberal party propose that we should pay sugar workers such sweated wages? People in this country are able to buy sugar at a very cheap rate, so cheap that they have no right whatever to expect to buy any of their food supplies below the cost of production. If food is sent into this country produced by a population who are content with a very low standard of life, it is our duty by some protective duty to keep it out, and the sooner the Government make a plain issue of that and give a proper protection, the better. It is our duty to see that the standard of life of our people is protected.

Of course, the sugar factories made a lot of money. There was only one way of getting them here. Nobody knew anything about sugar-beet, and we had to entice the Dutch people to the country to begin production and show us how to do it. They came, and got away with their reward, and a very good reward. If we had not offered them those tempting terms, the industry would never have been here. Now is the time slowly to reduce it. We should continue for the present with an arrangement which means employment for so many tens of thousands of our people and which makes prosperous many huge agricultural areas which would otherwise tend to become desolate.

1.43 p.m.

Mr. LANSBURY

I would say a few words on the statements made by the Member for Darwen (Sir H. Samuel). He has just left the Chamber; I suppose he is hungry, but I have sent him a message that I intend to reply to him. He was good enough to chide us practically with cowardice for not voting on the last occasion. I have reminded the right hon. Gentleman once or twice that it does not lie with the Members of the party which he leads to chide us with abstaining from voting on all sorts of questions. Last night, after making great speeches in support of the Government, his party quietly walked out without voting, and that is cowardice, if you like. On the last occasion when this subject was before us, when we were dealing with the Money Resolution, many hon. Members went into the Lobby against it. They numbered 22, including tellers. Of those, six were Members of other parties. One was a member of our party, the members of which, it is stated, never dare to vote according to their conscience. People should read the Division Lists before they fling such mis-statements about. The figures mean that 16 Members of the right hon. Gentleman's party had the courage of their convictions on the occasion of the Money Resolution. My withers are unwrung by anything which the right hon. Gentleman may say.

As the right hon. Gentleman has now returned to the Chamber, I had better tell him that I was dealing with his statements in regard to ourselves and our refusal to vote on the last occasion, and I was saying that he should be the last in this House to fling that sort of taunt at anybody. Last night after making great speeches in support of the Government his party walked out of the House without voting on the Motion.

Sir H. SAMUEL

There were speeches in support and in criticism.

Mr. LANSBURY

Let anybody read the right hon. Gentleman's speech. I heard it and also the speech of one of his hon. Friends who represents one of the Divisions of Middlesbrough. Those speeches were full of fulsome laudation of the Government and the Government's policy. The right hon. Gentleman cannot get away with it in that way. There was a clear issue before the House—support of the Government or not support of the Government—and the right hon. Gentleman's party had no opinion on the matter. They did not know whether they should support the Government or not, and so they walked out. Then the hon. Member for Ely (Mr. de Rothschild) spoke in the same sort of way, and it was said that no single Member of our party was allowed to vote as he pleased.

Mr. de ROTHSCHILD

I never said that.

Mr. LANSBURY

I am talking of both. They are both in the dock together.

Sir H. SAMUEL

I did not say that either.

Mr. LANSBURY

The taunt is always flung at us that we are not allowed to vote according to our conscience. On the Money Resolution, however, one of our Members did vote with the right hon. Gentleman. As I have said, the total number, with the tellers, was 22, and, of that number, 15 followers of the right hon. Gentleman followed him into the Lobby. I do not see, therefore, that it lies with him to rebuke us on the subject-matter with which he started his speech. The hon. Member for Ely said some very severe things about my right hon. Friend the Member for Swindon, and I have no doubt that in Committee, on the question of the Clause standing part, my right hon. Friend will be able to deal with them, but the position is an extraordinary one. My right hon. Friend was not in the House when this scheme was brought forward. From 1922 to 1929 he was not a Member of the House.

Mr. de ROTHSCHILD

Nor was I.

Mr. LANSBURY

It only shows that the hon. Gentleman should speak of what he knows, and should not fling accusations about in the manner that he did. He also said that my right hon. Friend had been appealed to again and again during his short term of office, which lasted from June, 1930 until August, 1931—

Mr. de ROTHSCHILD

I must correct the right hon. Gentleman—

Mr. LANSBURY

Would the hon. Member mind sitting down? Lord Noel-Buxton was Minister of Agriculture, and my right hon. Friend was Assistant Minister of Agriculture, and he had no responsibility for the policy of the Government, such as I and the other Members of the Cabinet had. No Under-Secretary, where there is a chief, would ever be held responsible for the policy of the Department. The hon. Gentleman knows, or ought to know, that my right hon. Friend the Member for Swindon, for just about 14 months out of the 10 years, was in charge of the Ministry of Agriculture. Then it has been argued by the Noble Lady the Member for the Sutton Division of Plymouth (Viscountess Astor) who also has had to leave the House, that the Labour party brought this in, that it is our child, and so on. It may be our bantling. Lord Snowden made a statement in June, 1924, that the Government intended to bring in a scheme, but, before that Government had any chance of dealing with the matter on their own lines, they were turned out by a combination led by the late Lord Asquith, and the first Bill that was brought in to initiate this scheme was brought in by the Government that succeeded the Labour Government.

Sir H. SAMUEL

And supported by you.

Mr. LANSBURY

It was supported by us, and supported by other people. I do not know whether the right hon. Gentleman was present when the Noble Lady made her speech, but the whole inception of the scheme and the bringing in of the scheme was put upon us; and I say quite deliberately that the Noble Lady, of all Members of the House, ought not to make a charge of that kind, when she herself was a Member of the party that implemented in their own way the proposal that was suggested by Lord Snowden, when he made his statement in June, 1924. No argument can get over facts, and anyone who has read the Greene Report knows that it is set out there quite clearly. [HON. MEMBERS: "Where?"] I do not want to take up time, or I would read it; I understand that it is desired that other business should be done after this. Hon. Members can, however, read the Report for themselves; it is there on record.

The hon. Member for Ely knows, or ought to know, perfectly well that this scheme has been in existence for 10 years, and that, at any time during the two years' life of the Labour Government, if the House of Commons, led by the Liberal party, had wished to do so, they could have turned out that Government; but the scheme has been acquiesced in and kept going. Further, over the whole period, whether it was supported by our party at the beginning or not—and I am saying this to answer the hon. Gentleman's gibe as to what we ought to have done to deal with the profit-making by the factories—during the whole period that we were in office, I think just under three years, in the one case less than a year and in the other just over two years—

Mr. de ROTHSCHILD

I must interrupt the right hon. Gentleman. It is quite true that his party was only in Office for about three years, but he is now accusing the National Government, which has been in office no greater time than that.

Mr. LANSBURY

The hon. Member is so accustomed to making false accusation against other people that he imagines that I am doing so. I am doing nothing of the kind. I am only contradicting the very wicked, stupid assumption that the Labour party was in office and could have dealt with this matter if they had had the will to do so. We have never had a majority—

Mr. DINGLE FOOT

rose—

Mr. LANSBURY

The hon. Member does not know. We were a minority Government in 1924, and we were a minority Government in 1929. I should not have thought that the hon. Member would want to controvert that.

Mr. FOOT

Does the right hon. Gentleman really say that the Labour Government would not have a majority in the House for this purpose? Does he not know perfectly well that, if an alteration such as is suggested had been proposed in the beet sugar subsidy during the last Parliament, he would have had the support of the Liberal Members?

Mr. LANSBURY

The hon. Member may know a very great deal; he knows much more than I do about that. I can only say that, speaking for myself, I never knew from one day to another what the policy of the Liberal party would be. The right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) brought forward no end of proposals for increasing expenditure on public works, and then the Liberal party joined with the Tory party in helping to turn us out because we had spent too much on public works. That shows that the hon. Member is really out of this altogether. I apologise to you, Sir—[Interruption.] I do not apologise to the hon Member. He made an unfounded accusation against my right hon. Friend such I have never heard from any member of the House. I am not giving way, so sit down. I did not intro- duce all this hullabaloo about people's consistency and inconsistency. The right hon. Gentleman started, followed by the hon. Member for Ely, and the Noble Lady, who is always right, who has the courage to say what she likes, but on two occasions when she could have registered her vote found something else to do.

For any one who has lived in politics any time, or lived the ordinary life of a man who has to get his living, to talk about consistency is sheer nonsense. We will be consistent when we are in the grave. We are none of us consistent whether we earn our bread working at manual labour or in an office or whether we earn our living in this place, in the courts, in the pulpit or anyhere else. I shall be the last person ever to boast of my consistency. When I hear hon. Members doing so, I am amazed at their effrontery. The right hon. Gentleman of all people was a member of the Government which imposed duties on tomatoes, potatoes, green stuff and fruit. How did they work out? Tomatoes are a very good article of food. At present the prices range from 8d. to 6d. per lb. The tariff enables them to be grown in this country, and in between the production of the tomatoes and their sale in the shops some one is scooping a very large profit even now. We are able to keep our finger on sugar, but in my district the other day the street traders rose in revolt because a big multiple store which had never sold tomatoes and vegetables before, began to sell tomatoes at I believe, 3d., certainly 2d. per lb., less than they were being sold on the costers' barrows. How is that done? The director of the stores grows tomatoes on a large scale and is able to sell them without any intermediate profit being skimmed off. The result is that those who have to depend on the higgling of the market, as the right hon. Gentleman would say, are unable to compete with him. That is inevitable under the system by which we levy these tariffs and also give assistance in the form of subsidies to private enterprise.

The right hon. Gentleman and his friends think that we are extremely inconsistent in voting for our Amendment. If the Chair puts it in such a way that we can vote straight on it, we shall be very glad, but if it is put in the ordinary way, that the words proposed to be left out stand part, that must be charged not against us but against the forms of the House. The right hon. Gentleman and his friends need be under no delusion. We want to vote for the Amendment, we wanted to vote for it on the Money Resolution, but we were out of Order, and it is our view of what should be done. We think that if the House had to sit another month in order to implement legislation along those lines, it ought to do so, but if the House does not do that we would in no circumstances propose to cut the subsidies off instantly, leaving those engaged in the industry to become unemployed and thrown on the Poor Law. We take up that position, not because we like it, but because of conditions over which we have no control. The right hon. Gentleman and others call this partial regulation of industry Socialist. They know thoroughly well the theory and practice of socialism as laid down in the books, but the Labour party in the House and on local authorities is in this position. We are Socialists, and we want to change the competitive system that we are living under into Socialism. The difference between ourselves and most other Socialist bodies in the world is that we wish to do so through the constitutional machinery of Parliament, which always brings us up against the practical questions of the moment and, as in the case of the railways round London, we are obliged because of the exigencies of the moment to support partial Socialist legislation which, if we had the power, we should deal with in a different manner altogether.

It is beside the point to gird at us for supporting measures which are only a tiny way on the road to ameliorating conditions, seeing that we have not yet won the country to our point of view. If there had ever been a Socialist majority in the House with the power to implement their social policy, and they had failed to let the world know exactly how they propose to do things, you would be able to make charges against us. Whenever a question of this sort comes up, when it is bad you say, "The Labour Government did it," or some other tom-fool suggestion. The real thing is that we have to live in a very imperfect world, and we have to do the best we can in those conditions. We are trying very hard to convert the country to socialism. We may never be able to do it, and therefore I expect the hon. Member thinks the Liberal party will come into its own. If there is one thing that is dead and damned, it is the idea of free competition and free imports. The hon. Member for Dundee tells me to go over there. He in his short life has migrated from one side to the other, and I have no doubt he will migrate again lots of times. The point that I am making is a perfectly simple one.

We want to establish socialism, but it is perfectly certain, whether we establish socialism or not, that the world is now in an altogether different condition from what it has been in before. When I came here in 1910 the right hon. Gentleman was a Member of a Government that poured scorn and contempt on the unemployed. Mr. Asquith and his Government, led by John Burns on this matter, declared that you had no right to help the unemployed in the manner in which you are helping them to-day. Nobody would have dreamed of doing it, but economic conditions and developments have compelled this Government, and the the right hon. Gentleman in 1931, to swallow nearly all the principles they have ever held. As I say, the world is entirely different from what it was in any other period, and I wish the right hon. Gentleman to give more attention to the problem which exists all over the world of what to do with the tremendous potential powers of production, how to deal with the enormous volume of commodities that mankind is able to produce, and how we can bring to the service of the masses of the world the great abundance which nature and man's scientific power give us. I know that tariffs will not do it, and that subsidies will not do it in the end. Until they are prepared to accept our proposal of the social ownership and use of what society produces, let the Liberal party produce their scheme.

We have had a century or more of free trade. I stood in this House begging for help for the unemployed in 1910, and I was told, what every economist of the Manchester school would tell me to-day, "Wait! Let the market gradually recover." A dozen great capitalists met me in London in order to convince me that it was no use producing any more, that there was too much of everything, you could not send people to the Dominions, and that you did not want more to eat, more clothes or more of anything. Great capitalists stood in the private room of an hotel to convince me that capitalism would recover itself, but I have lived long enough to know that capitalism has never done that for the working-classes, and I know now that economic developments are going to drive the world either into social ownership, control and distribution or that the world is going to crash in ruins.

2.9 p.m.

Mr. ELLIOT

The House always appreciates most the right hon. Gentleman the Leader of the Opposition when he can cut himself adrift from the immediate issues and their consideration and don the mantle, I will not say of the prophet, but of the soothsayer, and we Members of the House greatly appreciate hearing his account of past Debates and discussions here. It is true that matters have very greatly changed in the years since 1910 and that the Bill to-day and indeed the Amendment are proof of that fact. All that I would say in comment on his speech is that he, like us, recognises the stubborn nature of facts and feels that on many occasions he has had to compromise with his principles because of the irreducible nature of facts. He thinks that those facts will be greatly modified if he has a Parliamentary majority in this House, but, speaking as one who has on more than one occasion formed part of the Parliamentary majority, I can assure him that a certain amount of compromise with ideals and principles will still be just as necessary if he were sitting on this side of the Table with as large a majority as that which we enjoy just now. I am certain that only the good will which he has so frequently displayed in this House will save him from serious difficulties when, and if, he comes into that position of power which so far the country has refused to him and to his followers.

Let me return for a few moments to the Measure immediately before the House. I was a little afraid at one time that instead of a Debate about sugar it was a Debate about vinegar or pepper, so lively did the exchanges become. Let me, if I can, try to obtain the support of all sides of the House to the Measure which I am advancing to-day on this ground—that the reason for rejection as put down by hon. and right hon. Gentlemen opposite is that this Bill merely continues the subsidy. May I say most categorically that it does not. The subsidy continued here is at a point very much below the subsidy required to attract the financial backing which would be necessary for the continuation of even the most modest dividends from the capital employed. In fact, let me read again what I said on the subject on the Financial Resolution: There is no allowance made in the rates proposed in this Resolution for any margin in respect of capital services, that is to say, interest on capital or depreciation. Any allowances which have to be made in this respect, and the amount of such allowances will, of course, have to be reserved for the time being, pending the examination, which is now taking place, of the report of the Committee of Inquiry into the United Kingdom Sugar Industry, and the whole question of future policy."—[OFFICIAL REPORT, 27th June, 1935; col. 1293, Vol. 303.] Therefore, the rights of the House over the whole position of the factories remain absolutely unprejudiced by the decision which we ask them to take this afternoon. I hope, therefore, that those who have advanced criticism against the present constitution of the factory groups, against the dividends which have been paid and against the bonus distributions which have been made will realise that these questions are not to-day under consideration, for the sum which the Financial Resolution authorises and upon which this Bill is founded is merely a sum to continue the operation of the industry. There is no money in that for continuing the profits of the factories. Such sums, if voted, will need to be the subject of further consideration and debate by this House, and it seems to me that this narrows the field of discussion very considerably.

The right hon. Gentleman the Member for Darwen (Sir H. Samuel) said that it was a matter of some surprise to him that something new could be said on this ten-year-old controversy. There are many new things which can be said, and that is the benefit of debate in this House, because you can see the different points of view in the opinions and facts brought forward. The necessity, which is admitted even by the right hon. Gentleman the Member for Darwen, of not suddenly discontinuing this industry is one of the new facts which have emerged. It is true that he would not go quite as far as the hon. and right hon. Gentlemen above the gangway, but he said in terms that he would not be in favour immediately of discontinuing this industry and that the suggestion made by the Greene Committee for a gradual change over to some alternative crop would meet with his support.

The House then is unanimous on this point, that it is not desired by any section of the House forthwith to discontinue this industry. That does seem to me to be a point of importance to emerge from the long debates which have taken place. Secondly, it is true, as I say, that hon. and right hon. Members above the Gangway wish that there should be a much greater degree of organisation in the beet sugar factory groups. I say again, that that is not prejudiced by the decision which the House is asked to give to-day. That particular point, in fact, has been the subject of very careful examination by the Greene Committee, and both the majority and minority of the committee said that they thought the future organisation of the beet sugar group of factories should be considered.

Sir H. SAMUEL

With regard to the point with which the right hon. Gentleman was dealing, I have just refreshed my memory. The Greene Committee recommended that there should be a definite maximum period of three years for the subsidy to continue until an alternative crop had been suggested.

Mr. ELLIOT

I do not wish to misrepresent the right hon. Gentleman, but, obviously, the point of this tapering off is that an alternative crop has to be found. That is the very purpose for which this recommendation was designed. I think I am not overstating the case when I say that the right hon. Gentleman did suggest maintenance of assistance to the industry for a limited period, and to-day we are asking for maintenance of the industry for the period of the present campaign and no longer.

Sir H. SAMUEL

If the right hon. Gentleman will guarantee that it will be no longer, I will certainly vote for this Bill.

Mr. ELLIOT

If I were to announce my verdict in advance, the right hon. Gentleman would have no objection to further evidence being led. That is a rather strange demand from one who formerly occupied a semi-judicial position. I am afraid that I cannot go as far as that. I merely said that at the moment the whole House is agreed that further assistance should be given to the industry although there is a difference of opinion throughout the House as to how much should be given, and upon what terms it should be paid.

Much has been said about the high rates of dividends which have been paid. I do not wish to go at this moment into any defence of the factory dividends. At the outset it was clear that the venture was of a speculative nature and it did not attract the City. This is evidenced by the fact that a very large portion of the initial capital was in the form of debentures. But I do not wish to discuss that matter at any length, because it will be completely under the jurisdiction of the House at a future date when it comes to determine whether the industry should be continued as part of the long-term policy, and, if so, upon what terms any State assistance should be given. The right hon. Member for Darwen also brought up the question of the Excise Duty. We shall have many opportunities of discussing that. Prophesying the action of the Government, he also prophesied the line of argument he would use if the Government took a particular line of action and used arguments in support of that action. I will deal with those arguments when we come to them. He also envisaged the speech which the Chancellor of the Exchequer would make if he announced to the House the discontinuance of the assistance to the beet-sugar industry. "I have discontinued the sugar industry: let us sing Hallelujah." But he might also say the same of the motor car industry. "I have discontinued it: let us sing Hallelujah. I have discontinued the iron and steel industry: let us sing Hallelujah."

Attacks have been made on the refineries, but it is only fair to point out that when the duty on raw sugar was reduced by 2s. 4d. a cwt. in the 1928 Budget the benefit was passed on to the consumer as the refineries undertook to do. That promise was faithfully kept. The arrangement the refineries came to with the beet sugar factories in 1933 were, in fact, made at my request. Refineries and beet sugar factories got together because it was most undesirable that an internal quarrel should continue, and I accept the responsibility for having brought the two interests together. If these arrangements require further revision, there is no doubt that we shall be able to revise them in conjunction with the refining interests as well as the sugar factories.

The merits of the case, however, between the factories and the refineries are not under discussion as a whole now. What is now under discussion is whether this industry should be continued, and the employment it affords be given to our own people. I do not think there can be any disagreement about it. I think the whole House would be at one if there were a danger of the Amendment before the House being carried. I believe there is scarcely a member of any party in the House who would vote for the Amendment in those circumstances. I am certain that, whatever we desire, we do not desire to see unemployment spread in the countryside. It is not merely a question, as the right hon. member for Darwen seems to think, of 22,000 man-years engaged in the sugar industry. It is an interwoven part of the whole cycle of agriculture in the Eastern counties and throughout the land. I should view with the greatest uneasiness 400,000 acres now devoted to sugar beet suddenly swept away, for I do not consider that I have seen any alternative crop which could be put in the place of sugar beet. As to the suggestion about asparagus, I think that was made from a jocular rather than a business point of view, perhaps because the Noble Lady was about to go to a function where that succulent vegetable would be consumed.

Even the hon. Member for the Isle of Ely (Mr. de Rothschild) indicated his support of our proposals. It is true he offered some criticism. He indicated that the industry is of great use to his own smallholders. I gather that while he supported the subsidy he criticised those who brought it forward. I hope he will find it possible now and at subsequent stages of this Bill to lend us his support in the Lobby. The Debate has taken longer than we expected, but it has aroused great interest and has brought several new points of genuine interest not merely to the House but to the country as a whole. The country is following these Debates with concern, not only from the point of view of the effect of the remission of the whole or part of the heavy duty which is now being imposed on imported sugar, but with a view to considering the whole future of the industry of agriculture. The respite for which we ask will enable the matter to be further investigated, I claim that the case for the respite has been made out and therefore I hope that hon. Members will vote for the respite and not for sentence of death upon this particular industry.

12.25 p.m.

Mr. OSWALD LEWIS

It is most regrettable that this Bill should have been necessary. I cannot blame the Minister of Agriculture because, situated as he is, he naturally clutches eagerly at any subsidy that he can get hold of. Most of us, faced with the difficulties which confront the Minister of Agriculture, would act in exactly the same way. I cannot, however, agree that because the Minister of Agriculture is free from blame the Chancellor of the Exchequer is also free from blame. He is the custodian of the public purse, and I have not yet heard any adequate explanation of the extraordinary delay in appointing a committee of inquiry into this matter, which delay is the direct responsibility of the Chancellor of the Exchequer. As a result of that delay we find ourselves this afternoon in an unfortunate position. We are asked to vote for the continuance of a subsidy which has been roundly condemned by the independent committee that was appointed to consider it. So far as I can understand, there is only one serious argument that can be brought forward to induce us to vote for the Bill, and that is the argument that the Government must have more time to consider their long-term policy for sugar beet. As I have suggested, the reason why the Government require more time is the fault of the Chancellor of the Exchequer. If we accept the plea that the Government do require more time, and I feel that we must accept it, then we must support the Bill and I shall vote for it this afternoon, but I want to make it clear that I do so with extreme reluctance. I hope very much that the Government will make good use of the further time that the passage of the Bill will give them, and that they will be willing to learn by the successes and the failures of their policy with regard to agriculture.

The Government have two problems to solve in connection with this matter. They have to answer the very difficult question, shall Government assistance be given to enable sugar beet to be grown at all? We all agree that it cannot be grown without Government assistance, but there is sharp divergence of view in the House and in the Country whether that assistance should be forthcoming. I do not want to go over again the arguments that have been brought forward for and against that proposition. I content myself by saying that it is fair to sum up the principal arguments against Government assistance to the sugar beet industry as being, first, that the crop is practically valueless when it is produced at present sugar prices and, secondly, that we can get plenty of sugar elsewhere. Those arguments are greatly enforced by being endorsed by the Greene Committee.

I am one of those who do not agree with the conclusions to which the Greene Committee have come, but I do not think that those of us who differ from the Committee will gain anything by abusing the members of that Committee. I heard with great regret this afternoon the right hon. Member for Sparkbrook (Mr. Amery) describe the distinguished and learned chairman of that Committee and one of his colleagues as thick-headed because they did not agree with him on some particular issue. I hope that we shall not hear many more arguments of that kind, because they will hardly strengthen our case. The arguments for affording some assistance to sugar beet may be summed up by saying that the product is a necessity of life and that we ought as far as we can make ourselves self-supporting where necessities are concerned, also that the crop is not only a useful article when it is produced but that in its production it helps the general cycle of agriculture. I purposely do not lay stress upon the argument about employment or about the extreme cost, because to some extent they cancel out each other.

I cannot but admit that there is great force in the argument put forward by the right hon. Member for Darwen (Sir H. Samuel) that if a similar amount of money were expended in other industries equal or even greater employment could obviously be found in those industries. However, I do not rely on either of those two arguments. I do, however, feel that the arguments for some Government assistance are, on the whole, greater than those against, and if that view prevails the Government will have to decide what form the assistance is to take. It is most important at this juncture that the attention of the Government should be directed, before they have completed their inquiries, to the best methods for dealing with the matter. In all these problems of State assistance of agriculture we have to reconcile two things which at first sight are irreconcilable—the protection of the producer from the competition of low prices from overseas and the securing to the consumer of the benefit of those low prices. Of the methods that have so far been suggested much the happiest and most hopeful for combining those two objects is the method of a guaranteed price, supported by a levy on the sales of the product. That has been tried with wheat and it has been a great success, and I hope very much that the Government will not lightly cast aside the idea of trying it with sugar beet.

There are various advantages to be derived from this method of dealing with the question. I think the greatest is that there is no need to limit supplies from overseas under that system. The more I hear of quotas the less I like them. The method of the guaranteed price is, by its essence, a temporary measure. It visualises an ultimate increase of the market price to a figure which will exceed the guaranteed price, and then the whole scheme ceases to operate. May I remind the House that Malthus pointed out many years ago that population will always in the long run overtake and press upon food supplies, and, therefore, the question of low prices for agricultural products are in their nature temporary. I hope that in any scheme that is brought forward dealing with suger beet we shall bear that fact in mind. It is for that reason that I take this opportunity of urging on the Government to think very long before they reject the idea of the application of a guaranteed price for sugar beet.

2.36 p.m.

Captain BRISCOE

I only propose to detain the House for a few moments. The passage of this Bill and the continuance of the sugar-beet industry is of the very gravest importance to the constituency I represent. But it is a far wider problem than that. Thousands of our people who are engaged in the agricultural industry, who do not grow this particular crop, are more than alarmed as to what would occur if this crop ceased to be cultivated and if the hundreds and thousands of acres which now grow sugar-beet should come into cultivation with these other crops which to-day in many cases are beginning to show signs of being produced at a profit. There are many thousands of small holders and market gardeners who may be ruined if sugar-beet production comes to an end just at a moment when their struggle for existence is becoming less acute than it has been. A marketing scheme has been introduced by the Minister of Agriculture. They had a difficult time in their initial stages, and their success would certainly be prejudiced in many instances if they had forced upon them large quantities of produce from acres which are now growing sugar-beet.

All parties in the House wish to find employment on the land if possible for those unfortunate men who have lost employment in our big industrial centres. The task of putting these men on the land will be made far more difficult if the sugar-beet industry is not kept in existence. Then we come to the areas which grow this crop. Everybody is agreed that the industry right through is carried on with great efficiency. The factories have progressively decreased their costs of production and the agriculturists have progressively increased-the efficiency with which they produce the crop. It gives more employment per acre than any other crop grown in the country with the exception perhaps of potatoes, and it is of immense value to the smallholders in my constituency, many of whom are ex-Service men. I implore the House to give a Second Reading to the Bill for the sake of the employment of our people, in the countryside, for the sake of thousands of smallholders and market gardeners in East Anglia, and I hope that at the earliest possible date the Minister will decide on his long term permanent policy. There has been a great deal of criticism of the profits made by the factories. If any fault is to be found in that respect this House and past Governments are mainly to blame. These factories were set up on a short term basis. They had to make their profits, or were forced to make them, during a period of 10 years, because after that they had no idea as to whether the industry would continue to exist or not. With a permanent scheme to keep the industry going it may be possible to limit to reasonable proportions the profits which are made by the factories. Anxiety and uncertainty are bound to reduce efficiency in any industry. Therefore, I hope we shall have a permanent policy produced very shortly.

2.41 p.m.

Mr. CHARLES WILLIAMS

I do not regret having to take up the time of the House this afternoon, and it is no use the Minister trying to bring pressure to bear on supporters of the Government not to intervene in the debate because some of us are determined to put our point of view in what after all is a free House of Commons. I regret the perpetual pressure which is being put on private Members not to take part in debate. Heavy pressure has been put on this afternoon—

Captain BRISCOE

And on the Financial Resolution.

Mr. WILLIAMS

Yes, and I do not see why private Members should be so continually pressed by the Government as they are to-day. I am sure that there will be a great deal of sympathy for that point of view. The Minister in his eloquent speech made an appeal to the House to give him the Bill so that the Government might have a respite in order to get evidence. What is the Greene Report except evidence? It shows the hopeless futility of the policy of subsidies, and even the Minister in his private moments will admit that. The Government there have all the evidence they want. They have evidence that in many of the factories which have been put up there must be a specially high rate of subsidy because of the incom- petence of some factories. Surely the Government can make up their minds on this matter. The trouble about the Government is that there are some people in it who were too closely in contact with the last Socialist Government. Were it not for that they would always make up their mind. Surely the Government realise, in the first place, that this industry is of great value to the nation and gives employment on land which normally would not give employment. You may weigh up the figures, as the right hon. Member for Darwen (Sir H. Samuel) did, as to how much the Exchequer would have saved if there had been no subsidy or how much you would have had to pay out, less income tax. But that is not the point. The real point is that the worst and most expensive way of setting up and helping an industry is by means of a subsidy. You have to take the money from the taxpayers, you have to limit production and their capacity to give labour, in order to make an artificial industry. We have been discussing this matter for years, and nobody can deny that. There has been debate after debate. Heaven only knows how many speeches have been made by the right hon. Member for Darwen on this subject. I am not sure that I have not spoken twice on the subject.

There is one very clear and simple way out of this trouble, and that is by a direct tariff. It is easy; it does not require a respite for evidence; and the House of Commons would probably pass it in one debate. Then there would be an end to this perpetual dragging up of an inconvenient and stupid question. You would not have the plea of that great section of the East of England, the smallholders, whose position was put so admirably by the hon. Member for the Isle of Ely (Mr. de Rothschild). You would not have the sense of insecurity which we feel to-day, even with this Bill. The Government have the evidence on which they might well have acted years ago. The Government know that the majority of the House would give them full support in changing this subsidy policy, which is a waste and an extravagance, to a tariff policy. Personally I cannot see any reason why they should always be saying "Wait till next year". It is becoming clear that the Government's weakest point—they have many strong points—is their extraordinary devotion to subsidies and quotas, when they should go by the straight and easy road of tariffs. I shall always be against subsidies, because I believe they are illogical and wrong when there is an easier way. The Minister of Agriculture said "Let us recognise the stubborn nature of fact." The fact is that this country loathes subsidies. Even the best Government is bound to wreck its chances if it goes on doing this kind of thing.

2.48 p.m.

Lieut.-Colonel Sir ARNOLD WILSON

I should be sorry if the House divided immediately after a speech like that to which we have just listened. I heartily support the Government's proposal. When I see the subsidies that have been lavished on shipping, on industry by derating, by Unemployment Insurance and in half-a-dozen other directions, in the past ten years, I stand amazed at the moderation of the Minister of Agriculture and of the agricultural industry. This Bill and the Greene Committee's

Report assume the existence for practical purposes, of only two kinds of sugar, beet and cane. But glucose is coming forward. It is at the present time being made in Germany by Professor Bergius from wood-plug and is being extensively fed to cattle. That process may very well attain before long considerable importance. It may be a substantial check upon the cost of sugar in certain directions. I hope that the Minister has his eye on, glucose. It is very nutritious, both for human beings and cattle. It requires no subsidy, and in the next few years it may well attain in this country an industrial importance which will make the demand for and the relations between beet and cane appear in a very different light.

Question put, "That the words proposed to be left out stand part of the Question."

The House divided; Ayes, 134; Noes, 36.

Division No. 269.]	AYES.	[2.50 p.m.
Adams, Samuel Vyvyan T. (Leeds, W.)	Hanbury, Sir Cecil	Radford, E. A.
Agnew, Lieut.-Com. P. Q.	Hannon, Patrick Joseph Henry	Ramsay, Alexander (W. Bromwich)
Amery, Rt. Hon. Leopold C. M. S.	Hartland, George A.	Ramsbotham, Herwald
Balfour, Capt. Harold (I. of Thanet)	Haslam, Henry (Horncastle)	Rankin, Robert
Barton, Capt. Basil Kelsey	Heneage, Lieut.-Colonel Arthur P.	Reed, Arthur C. (Exeter)
Beaumont, Hn. R. E. B. (Portsm'th, C.)	Hills, Major Rt. Hon. John Walter	Reid, William Allan (Derby)
Blindell, James	Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.	Rickards, George William
Bower, Commander Robert Tatton	Hope, Capt. Hon. A. O. J. (Aston)	Ropner, Colonel L.
Briscoe, Capt. Richard George	Inskip, Rt. Hon. Sir Thomas W. H.	Rosbotham, Sir Thomas
Broadbent, Colonel John	Jackson, Sir Henry (Wandsworth, C.)	Ross Taylor, Walter (Woodbridge)
Brocklebank, C. E. R.	Joel, Dudley J. Barnato	Rothschild, James A. de
Brown, Rt. Hon. Ernest (Leith)	Keyes, Admiral Sir Roger	Ruggles-Brise, Colonel Sir Edward
Brown, Brig.-Gen. H. C. (Berks., Newb'y)	Kirkpatrick William M.	Russell, Alexander West (Tynemouth)
Buchan-Hepburn, P. G. T.	Latham, Sir Herbert Paul	Russell, Hamer Field (Sheffield, B'tside)
Burgin, Dr. Edward Leslie	Lewis, Oswald	Rutherford, John (Edmonton)
Burnett, John George	Lindsay, Noel Ker	Salmon, Sir Isidore
Burton, Colonel Henry Walter	Llewellin, Major John J.	Samuel, M. R. A. (W'ds'wth, Putney).
Campbell, Sir Edward Taswell (Brmly)	Lockwood, John C. (Hackney, C.)	Sanderson, Sir Frank Barnard
Campbell-Johnston, Malcolm	Loftus, Pierce C.	Shaw, Helen B. (Lanark, Bothwell)
Christie, James Archibald	Lovat-Prater, James Alexander	Shaw, Captain William T. (Forfar)
Churchill, Rt. Hon. Winston Spencer	Macdonald, Capt. P. D. (I. of W.)	Simon, Rt. Hon. Sir John
Clayton, Sir Christopher	McLean, Major Sir Alan	Smith, Sir Robert (Ab'd'n & K'dine, C.)
Cobb, Sir Cyril	McLean, Dr. W. H. (Tradeston)	Southby, Commander Archibald R. J.
Cross, R. H.	Macquisten, Frederick Alexander	Stanley, Rt. Hon. Lord (Fylde)
Crossley, A. C.	Makins, Brigadier-General Ernest	Stewart, J. Henderson (Fife, E.)
Denman, Hon. R. D.	Margesson, Capt. Rt. Hon. H. D. R.	Strauss, Edward A.
Denville, Alfred	Marsden, Commander Arthur	Stuart, Hon. J. (Moray and Nairn)
Dickie, John P.	Mayhew, Lieut.-Colonel John	Sugden, Sir Wilfrid Hart
Donner, P. W.	Mellor, Sir J. S. P.	Summersby, Charles H.
Dower, Captain A. V. G.	Mitchell, Harold P. (Br'tl'd & Chisw'k)	Thomas, Rt. Hon. J. H. (Derby)
Duckworth, George A. V.	Mitchell, Sir W. Lane (Streatham)	Thomas, James P. L. (Hereford)
Duncan, James A. L. (Kensington, N.)	Moore, Lt.-Col. Thomas C. R. (Ayr)	Thomson, Sir James D. W.
Eden, Rt. Hon. Anthony	Morris-Jones, Dr. J. H. (Denbigh)	Todd, Lt.-Col. A. J. K. (B'wick-on-T.)
Elliot, Rt. Hon. Walter	Munro, Patrick	Turton, Robert Hugh
Ellis, Sir R. Geoffrey	Nation, Brigadier-General J. J. H.	Wallace, Captain D. E. (Hornsey)
Emmott, Charles E. G. C.	Nunn, William	Wallace, Sir John (Dunfermline)
Essenhigh, Reginald Clara	Orr Ewing, I. L.	Ward, Irene Mary Bewick (Wallsend)
Fremantle, Sir Francis	Palmer, Francis Noel	Willoughby de Eresby, Lord
Ganzoni, Sir John	Patrick, Colin M.	Wilson, Lt.-Col. Sir Arnold (Hertf'd)
Goldie, Noel B.	Peat, Charles U.	Wise, Alfred R.
Gower, Sir Robert	Penny, Sir George	Withers, Sir John James
Granville, Edgar	Percy, Lord Eustace	Worthington, Sir John
Grattan-Doyle, Sir Nicholas	Petherick, M.
Graves, Marjorie	Pike, Cecil F.	TELLERS FOR THE AYES.—
Greene, William P. C.	Powell, Lieut.-Col. Evelyn G. H.	Lieut.-Colonel Sir A. Lambert Ward
Gretton, Colonel Rt. Hon. John	Power, Sir John Cecil	and Sir Walter Womersley.
NOES.
Addison, Rt. Hon. Dr. Christopher	Hamilton, Sir R. W. (Orkney & Zetl'nd)	Rathbone, Eleanor
Attlee, Rt. Hon. Clement R.	Harris, Sir Percy	Rea, Sir Walter
Brown, C. W. E. (Notts., Mansfield)	Janner, Barnett	Samuel, Rt. Hon. Sir H. (Darwen)
Cocks, Frederick Seymour	Lansbury, Rt. Hon. George	Smith, Tom (Normanton)
Davies, David L. (Pontypridd)	Lunn, William	Strauss, G. R. (Lambeth, North)
Dobbie, William	Macdonald, Gordon (Ince)	West, F. R.
Edwards, Sir Charles	McEntee, Valentine L.	Williams, Thomas (York, Don Valley)
Evans, Capt. Ernest (Welsh Univ.)	Maclean, Neil (Glasgow, Govan)	Wilmot, John
Foot, Dingle (Dundee)	Mason, David M. (Edinburgh, E.)	Wood, Sir Murdoch McKenzie (Banff)
Gardner, Benjamin Walter	Maxton, James	Young, Ernest J. (Middlesbrough, E.)
George, Major G. Lloyd (Pembroke)	Molson, A. Hugh Elsdale
Grenfell, David Rees (Glamorgan)	Moreing, Adrian C.	TELLERS FOR THE NOES.—
Griffith, F. Kingsley (Middlesbro', W.)	Parkinson, John Allen	Mr. Tinker and Mr. Paling.

Resolution, reported: That, for the purposes of any Act of the present Session to make further provision with respect to the University of Durham and its constituent divisions and colleges, it is expedient to authorise the payment out of moneys provided by Parliament, to an amount approved by the Treasury, of all expenses incurred in the execution of the said Act by the Commissioners appointed thereunder, including such remuneration as the Treasury may determine to be payable to persons employed by the said Commissioners. Resolution agreed to.

Bill committed to a Committee of the Whole House for Monday next.—[Sir G. Penny.]