COST OF LIVING.

HC Deb 28 July 1937 vol 326 cc3129-244

4.4 p.m.

Mr. David Grenfell

This occasion gives us an opportunity of referring to what has now become a matter of very grave public concern. In the last year or two the country has been much interested in what is now familiar to all of us as the cost of living. The cost of living scales that are now prescribed have reference to the selling prices, the retail prices of a large number of commodities which enter into the regular expenditure of the average family in this country, under various headings covering food, which is perhaps the most important, and rent, which is also a matter of supreme importance to many people, on clothing, fuel and light and "miscellaneous." Under these five heads a scale has been devised which shows a kind of mirror vaguely reflecting the conditions of life for a very large number of people. I understand that there is now on foot, and I hope that there is in progress, a survey of the effectiveness of this instrument for gauging the purchasing power and the social conditions of our people.

Much criticism has been directed against the scales and much concern has been shown in recent years because of the lack of elasticity and possibly the lack of accuracy of the ascertainments of this Ministry of Labour scale. The scale has been moving upwards in the last four years at a more or less steady pace, and that of course must be a matter of very great concern to people who have a very small and narrow margin between their purchasing power and their income. When the movement is downward it suggests an increase in the comfort of a large number of people, and a movement upwards an increase of hardship for the same people. Therefore it is highly important that the scale should reflect as accurately as possible the various items which go into the family budgets of this very large number of people.

The House will forgive me for referring to what I shall describe as the lower strata of society, the people who live ordinarily at a low level of comfort. They represent a number which I would not care to assess; I would not venture to state in exact proportions the number of those who are affected by any percentage movement in the cost of living, but I shall show later that there is a large mass of people who are vitally concerned in these fluctuations. The cost of living argument, the cost of living scales, are current matter for political propaganda. When the index climbs the scale the Government's speakers are silent; when there is a fall the full chorus is turned on. In the last three or four years very little indeed has been heard about the increase in the cost of living from speakers on the Government Benches, and we on this side of the House are far too modest to make use of the full propaganda value of this matter. But, discarding all propaganda this afternoon, I would urge the importance of very careful and close attention to the figures which I shall submit.

We have the Ministry of Labour figures given to us monthly. I do not know how many Members of this House are in the habit of comparing the figures month by month. I shall endeavour to take the figures as they appear in the last Gazette of the Ministry of Labour. They show that the average increase over the whole list of commodities has been a percentage of 55 above the datum level of 1914. That is the figure for July, 1937. It is shown as related to the various items, "A," "B," "C," "D " and "E" in the category of ascertainable commodities. Food shows an increase of 40 per cent.; rents, including rates, 59 per cent. increase; clothing, 105 per cent. increase; boots, 95 per cent. increase.

Sir Arnold Wilson

The proportion is between 155 and 138, but not between 55 and 38. The hon. Member should calculate his percentages on the increases beyond 138.

Mr. Grenfell

The hon. Member will forgive me. If I make a mistake it will not be in my arithmetic. I repeat that the figures now stand at 55 points above the datum line of 100 for 1914. That is quite clear. If I come to percentages I shall not omit the hon. Member's point. There are explanations offered for this large increase in the cost of commodities. In regard to the cost of clothing for instance, the public are now being told that this is due largely to the increased cost of wool. Many more explanations of the kind should be offered and the House wants more explanations. With regard to the price of boots, it would be very useful if the Ministry of Labour or the Board of Trade would carry on a special investigation to ascertain the cost of material, the cost of labour and the cost Of distribution at various stages in the marketing and sale of boots. It would be a very great revelation indeed. We must ask for that information and for very much more similar information when the new scale is being designed, when the new arrangements are made for properly relating the implications of the scale to the life of the people.

Let us now examine these figures. The average increase of 55 per cent. is itemised under the cost of food, rent and clothing, fuel and light. The figures affect the purchaser of these commodities and are of vital importance, as I have said, to persons of small income. It does not matter very much to a person with a large and generous income what the cost of living figures may be. The figures do not enter very much into the life of the average Member of this House. But they do mean something vital to the poorer people of the country. Let us first of all take the persons in employment, those whose wages can be ascertained. Take them in the bulk. The Chancellor of the Exchequer should be regarded as a good authority in these matters. He has access to the information, and he gave an estimate of the increase in wages in the last four years, 1933 to 1937, and said that it was just over £1,000,000 a week. He was corroborated by the hon. Member for East Ham South (Mr. Barnes), who derived his authority from an unimpeachable source and declared that the increase of wages in the same period was 2½ per cent. of the aggregate wages paid in this country. The Chancellor of the Exchequer says £1,037,000 a week; the hon. Member for East Ham South says 2½ per cent. on the wages paid. I think the House will find that these figures correspond almost exactly, and agreement between those two authorities, one on each side of the House, is sufficient for my purpose.

Mr. Mabane

Does the hon. Member refer to rates of wages or to actual gross wages?

Mr. Grenfell

I was referring to the ascertained increase in wages as given by the Chancellor of the Exchequer. The hon. Member for East Ham, South, based his statement on the authority of the Cambridge and Oxford Universities research council which has gone into these matters. I base my statement on the statements of both those authorities. I can add that the gross wages paid in this country are estimated at somewhere about £2,000,000,000 a year. As I say, I think the correspondence between the estimates of the two authorities whom I have quoted, is sufficient for the purposes of this Debate. In considering these matters we are very much handicapped by the lack of correct, detailed and precise information. I hope that the President of the Board of Trade will give his personal attention to the need for such information. Much has already been done in this respect in other countries. In America, for example, a great deal has been done in the ascertainment of the purchasing power of industrial, wage-earning and professional people.

The fact that the great majority of wage-earners live from hand to mouth and on a very narrow margin is not sufficiently appreciated until it is forced upon our attention in one way or another. In the recent report of the Unemployment Assistance Board there will be found on page 60 a table which is not intended to show the facts which I have derived from it, but which does, nevertheless, show those facts very clearly. It shows that out of a total of 580;000 applicants for unemployment assistance, 315,000 were entirely without resources. These figures are very significant. They are indispensable to a study of this problem. We find that the number of applicants for assistance who reside alone as lodgers is 107,500. Those are single men or single women with no family ties, and of that number of 107,500 no fewer than 100,000 are entirely without resources. Applicants residing in households of two persons number 103,000, and of these 59,000 are devoid of all resources. The number of applicants living in households of three or four, but without children under 14, is 101,500, and of these, 10,000 are without resources. These are grownup people living together, but not having either the usual weight of family responsibilities or the loneliness and isolation of the single persons dealt with in the first set of figures. Then the number of applicants residing in households of three or more, including children under 14, is 268,000, and of these 146,000 are entirely without resources.

This table shows to all who care to study the figures, the large mass of people in this country who live on the verge of poverty and who, when their term of unemployment assistance comes to an end, find themselves entirely without sustenance and without means of any kind. Another important and significant point is that of these applicants for unemployment assistance, 45 per cent. are over 45 years of age. This large mass of people who have now passed the age of 45 are looked upon as C.3 in the labour market and are no longer needed. They are rejected from the labour army and have to stand by when they are in need of work. They have no chance of employment and are left without resources after 25 or 30 years of work in industry. The prospects for them are, indeed, hopeless.

I have already referred to the estimate of the total amount paid in wages which stands, I think, at about £2,000,000,000 per annum. Wage rates vary very much between different classes of workers, but the other day we were given an astounding but perfectly correct figure in the House by the Secretary for Mines concerning miners' wages. He said, and I accept the evidence, that the average annual wage of the mining population in this country, who are engaged in one of the most hazardous, disagreeable, and heaviest occupations it is possible to imagine, was last year not more than £130, or £2 10s. a week. That is the wage for that class of worker, but there are millions of people who earn very much less. The average wage is one which does not permit of great indulgences or a large measure of savings. As I have said, these people for the most part live on the very narrowest margin of sustenance from the beginning of their working life to its end. There are certain unorganised workers who ought not to be omitted from our consideration when we are dealing with this subject. There is a large mass of unorganised workers in the catering and distributive trades who are paid scandalously low wages.

The Minister may ask me why I am raising this subject on this occasion, and what is the responsibility of the Government in this connection. Well, we hear eloquent speeches at the week-end from hon. Members opposite on the wonderful things which the Government have done. We are told that the Government have created more employment and have raised wages, and when the cost of living did show a decline, full advantage was taken of that fact, also. But hon. Members cannot have it both ways, and now that the cost of living is mounting, we are entitled to ask for an explanation. As they have given one side of the balance sheet, we are entitled to draw attention to the other side and to correct the impression of prosperity which hon. Members seek to convey by calling attention to certain facts. It is an undeniable fact that the cost of living is rising rapidly, and that wages are moving very slowly. The gap between the purchasing power of the wage-earners and the cost of the commodities which they require is widening. No compensation is provided in these circumstances for those who have no prospect of more regular work for those who are in receipt of unemployment assistance or Old Age or widows' pensions or any of the other people with small incomes who have no prospect of any increase in those incomes to help them to meet the increased cost of living. The Government take credit for increasing the amount of work available. We say that the standard of living for the masses of the people is being steadily lowered.

Now I come to the figure which the hon. Member for Hitchin (Sir A. Wilson) invited me to give. The cost of living has advanced 17 points on 138 points in the last four years. In 1933 the number of points above the 1914 datum line was 38. The number is now 55. That is 17 points added to the 38 points. The figures are 155 compared with 138. It is not 17 per cent. on the total of 1933; it is approximately 12½ per cent. The hon. Member may be assured that I would not omit a fact of that kind in presenting these figures. There is another figure which has never, in my recollection, been given in these discussions so far. That is a figure which I hazarded on my own behalf, that each point of increase in the index figure is equal to a gross total of £15,000,000. If we accept that figure, and I invite hon. Members to examine it, and if we multiply £15,000,000 by the 17 points increase in 1937 compared with 1933, we find that the total of 1937 exceeds that of 1933 by no less than £255,000,000. That is, the enhanced price of the commodities included in the scale represents a total expenditure which is £255,000,000 more than that of 1933.

The next ascertainment which I wish to give is not so easy. Wage-earners classified for various Governmental purposes are a substantial proportion of the total population affected by the cost of living but an exact figure is not available. We know that there are 16,000,000 or 17,000,000 people insured for national health insurance purposes and 12,000,000 or 13,000,000 insured for purposes of unemployment and we know that there are 21,000,000 people gainfully occupied in this country. These are accepted figures We do not know, however, what proportion of the expenditure covered by this index figure is incurred by wage-earners. I submit the estimate that the wage-earners purchase 60 per cent. of these commodities, and, therefore, that the increase of £255,000,000 is borne by the wage-earners, to the extent of about £150,000,000.

Let us see, then, where the workers stand, taking the evidence offered by the Chancellor of the Exchequer and other authorities in this country. If the increased expenditure of the wage-earners at the present rate is £150,000,000 a year and the increase in wages is £1,000,000 a week, or £50,000,000 a year, then those wage-earners must now be £100,000,000 a year worse off than they were in 1933. I am sure my arithmetic cannot be disputed. Setting this figure aside for a moment, I submit I am right in assuming that the workers need a very considerable increase in wages to enable them to regain the purchasing power which they had in 1933. I come back to the point which I made some time ago when the hon. Member for Hitchin corrected me. Instead of computing the increase over 1933 at 17 points on 138 I will assume that the cost of living has gone up 12½ per cent. or one-eighth since 1933. That quite clearly shows that the workers need 12½ per cent. more wages if they are to maintain the standard of 1933. But my hon. Friend the Member for East Ham, South said that the workers had only received a meagre increase of 2½ per cent. since 1933, and that corresponded with the estimate of the Chancellor of the Exchequer. So 12½ per cent. is necessary to restore their purchasing power in full, but still the hard-working people of this country, in spite of having received 2½ per cent. advance in aggregate wages, are short by 10 per cent. of the standard of living in 1933. How are the Government to do justice to those people who have been so impoverished and so much affected by an increase in the cost of living for which they are not in the least responsible? How are the Government to do anything to restore to these people that which they have lost? I shall await eagerly for some statement from the Minister, who joins with all his colleagues in making such extravagant claims on behalf of the Government from time to time.

Having studied the position of the wage-earner, the grievance has not been fully stated, but indeed worse when one comes to deal with the people who have no wages, the people who are unemployed and who are paid standard benefits, measured by scales established from time to time, always on the understanding that they will be very much less than the wages of similar persons in employment. Those scales have varied since 1920, but even so the unemployed families are compelled to use all their slender resources whenever a prolonged period of unemployment comes, and when it comes to the means test there is the despoilment of all those associated with the applicant and the wage-earner in the same household. Let me apply this increase of 17 points to the incomes of the unemployed workpeople. An increase of 17 points in the cost of living to the ordinary worker may be tantamount to a loss in purchasing power of 5s. or 6s. a week. I think that would be a fair estimate of the loss to the average workman who works for £3 or £4 a week, but in the case of the unemployed the proportionate loss is greater, though nominally represented by a sum of 3s. or 4s. a week. Let us also take account of the still worse case of the old age pensioner or the widow pensioner depending on 10s. a week. The 17 points increase in the cost of living scales in their case means a cut of 1s. from 10s. Those are the direct effects of this increase in the cost of living, which, to those who play with figures by the million, are only interesting speculations when bringing them down to the point where the boot pinches and where there is great hardship on the one hand or comfort on the other, depending on the direction in which the scales go.

The Chancellor of the Exchequer has dealt with the question of our national prosperity. When I heard him speak and read his speech a day or two following, I thought he had made perhaps one of the most brilliant speeches of his life. It was a very short speech on a Friday a little while ago, but I thought he must have been blind to the main human considerations of the finance of this country. The right hon. Gentleman must look again at this problem, and, after all, the hon. and gallant Gentleman the Financial Secretary to the Treasury, who is sitting opposite, shares with him the responsibility of conducting our financial system in such a way as to remove hardships tom classes of people in this country and in such a way as to give encouragement to industry and to effort and enterprise. They have a very large responsibility indeed in this matter of the distribution of our national wealth, and I would urge the Chancellor of the Exchequer and the Financial Secretary to the Treasury to give this problem immediate attention, this immense problem of the increasing maldistribution of the national wealth, which must lead to a breakdown in purchasing power, in the retail trade in the first instance, and consequently in the whole scheme of agricultural production, food imports, and the distribution of commodities. The Minister of Health is also involved. All his efforts, laudable enough in purpose, for improving health and fitness must fail if proper food, housing, and clothing are not available to the people of this country. If the purchasing power of the people of this country is allowed to lag behind the inadequate standard of previous years, if there is to be no improvement, but rather a degradation, of the standard of those people, what is the use of coming to this House to talk about improving health and fitness? The essential condition of all these plans is the supply of good, wholesome food at a reasonable price to the people of this country.

I omitted to mention, when referring to the responsibility of the Government, to the fact that they have drastically re- cast the distributive system in this country. They have built up an intricate network of trade regulations and restrictions. They have raised tariffs and duties on the most necessary commodities in every direction. Food is taxed. I remember the late Lord Snowden—Philip Snowden, as he then was—when Chancellor of the Exchequer referring to the tobacco tax and to the poor man who had to draw 16 whiffs for the Government when smoking a cigarette in order to enjoy the pleasure of one whiff for himself. That is an illustration that would not fit in this case, but I advise the House to look at the very large number of slices of bread and meat that have disappeared from the tables of the poor because of the increased price of food in order to fill the coffers of the Exchequer through the tariffs raised on these commodities.

I put a question to the President of the Board of Trade the other day about the wholesale price of tea. I had to put two or three questions in order to get the answer that I wanted, and I am not sure that I got the information in the end, but the information given to me was that the wholesale price of tea was 11.7d. per lb. The duty of 4d. added brought it to 15.7d. In 1936 the price had gone up to 13.07d., and the duty had also been raised from 4d. to 6d. The wholesale price of tea, including the additional duty, had now risen from 15.7d. to 19.07d. Tea is not the only commodity. Potatoes are up by 40 per cent., bacon is up by 30 per cent., and bread is up by 23 per cent., and they are still going up, month by month, but I am taking the four years to make the computation. The consumers have to pay more and more, and there is no indication that the Government have any policy to check this unwarranted rise in the cost of commodities. The consumers are complaining. It is no use assuming that all this goes on and is simply a manipulation of figures. There are grave complaints. I have received letters from people in all parts of the country, since my name was mentioned in connection with this matter a few days ago, containing very grievous complaints indeed, and I urge the Government to think, not so much of protection from the foreign producers, but a little more of protection for the consumers in the home market.

There is something radically wrong with the system of distribution in this country, something to which the Government must pay attention. The Government should devise some means to check speculation in food commodities, because much of that still goes on. The reorganisation of the wholesale and retail trades is due. The consumer will not put up, without a very strong protest, with the tendency that has been displayed in the markets in recent days. I do not know whether I should refer very much to the small retailers and the exorbitant profits made by some of them. I think the retail trade is perhaps as responsible as the wholesale trade—there is very great inefficiency in marketing—but I ask the President of the Board of Trade and the Minister who shares with the Chancellor of the Exchequer the responsibility for finance to look into these questions. This year we shall produce the largest national income that this country has ever found. The figure will probably not be less than £5,500,000,000. How that figure has swollen to its present dimensions is another story, a story which I cannot begin to tell to-day, but out of that £5,500,000,000 a portion, all too small, goes to the wage-earning classes of this country. That figure is swollen by swelling the prices. It is not all increased production. We know the special circumstances under which finance and production figures are made to present a false sense of prosperity for all classes. There is much profiteering in foodstuffs, and the value of the turnover is enhanced. These figures suit the Exchequer, and it may be good for the Chancellor to encourage this sort of thing. Then again there is much rack-renting. I hope the Government will see that more houses are not decontrolled, in view of the evidence which we have seen of rack-renting and the dispossession of the tenants in those houses.

The Government must take a greater interest in the means by which the cost of living figures go up, in order not to be called upon to meet grave discontent and grave protests. I think somebody attributed to me the intention of threatening the House in this Debate. I make no threats—I know how foolish it is to make threats—but does anyone in this House believe that the cost of living can go up another 17 points in the next 12 months without calling forth a storm of protest, a new series of demands for the necessary purchasing power, from every class of workers in this country? Does anybody think, quite apart from the protests of these people, that it is just that the unemployed man, in the face of the increased cost of living: should be tied for always to the standard benefit payable at the present time? Does anybody think that the last word in generosity has been said in the case of the old age pensioner? I hope the Government will use this Recess, between now and the re-assembly of the House, to reconsider the situation, in view of the enormous burdens placed upon the masses of the poorer people of this country, and that they will find means by which justice can be done.

4.42 p.m.

Mr. Graham White

The hon. Member for Gower (Mr. Grenfell) has, I think, rendered a service to the House by raising this subject to-day, and in doing so he has presented the subject with a wealth of detail, capacity, and human sympathy which, I think, everyone will recognise. Many of us will wish to see in the OFFICIAL REPORT some of the figures which he mentioned, as some of them were new, and I think we shall look forward to studying them with very considerable interest. He mentioned a number of authorities, and when I think whether there is any authority which he has not mentioned, there is only one that I can bring to mind, and that is one that might appeal to all Members of the House, as it is the Select Committee which has been examining into the affairs of the Kitchen Committee of this House. On 22nd June this year they presented a report, in which they said that if the present increase in the cost of commodities was maintained, the price of meals to Members would have to be raised very considerably.

This subject is as the hon. Member said, a vital matter. When we recollect that there are some 4,500,000 people in this country who spend on an average only 4s. a week on food, another 5,000,000 who spend only 6s., and another 9,000,000 who spend only 8s., and when we remember that the Nutrition Committee of the British Medical Association has fixed 7s. a week as the minimum required for a reasonable physical existence, we can see at once what havoc will be wrought in a multitude of homes if the cost of living continues to rise. We can also see that a very considerable section of the community, to whom it may be possible to purchase sufficient food and other things to make life tolerable and efficient, will be brought down to the scale of those who are not able to do that. My hon. Friend referred to the cost-of-living index figure of the Ministry of Labour. Since 1904 the conditions of life an this country have changed to an extraordinary extent. It may very well be that the inquiry which is being made will find that the basis of the cost-of-living index requires little alteration. I do not know whether that is the case or not, but f think it will be found in the passage of time that the whole basis will probably require considerable reconstruction.

The unfortunate fact is that there is a large body of opinion which has lost confidence in the basis of the index. The important thing is that it should have the complete confidence of the people at large. The significance of the matter becomes immediately apparent when one remembers that there are in the heavy industries at least 1,000,000 people whose remuneration fluctuates with the cost of living; and that there are important sections of the Civil Service whose salaries are varied with changes in the cost of living. According to the observations which have been made in the House with regard to the inquiry which is being made, it is to be carried out in respect of four special periods. I think that one is to be October this year and that the inquiry is to be related to intervals of three months. Does that mean that the House and the country are not to have any information in regard to this important matter until about this time next year? A great deal may happen in the next 12 months, and it is important that the inquiry should be speeded up so that we can have some information in a shorter time than 12 months. I agree with my hon. Friend that if the cost of living rises by 12 or 15 points in the next 12 months a serious situation will have arisen, and it is vitally necessary that we should have some information as to the basis of the cost-of-living index very soon.

The general position. comparing it with 1929, a date which is frequently taken, is that the cost of living is still just under 4 per cent. less, and the general level of wages is approximately the same as it was in 1929. The question which is worthy of consideration at the moment is, what is the course of events likely to be in the very near future? It is not necessary for me to give figures of the rises that have taken place, but we have to give some consideration to what the course of events is likely to be in, say, the next six months. A significant fact with regard to the cost of living is that there has been no seasonal decline this year. Normally there is a decline from roughly before Christmas to about Easter. The cost of living has been stationary for that period this year. It is a significant factor, and the only supposition which one can base upon it is that we shall see a much steeper rise between now and Christmas than we had last year. That seems to me a reasonable assumption to make.

Let us look at the matter from an even broader basis than that. What is the position throughout the world? The great stocks of material which existed in 1931 have disappeared almost entirely, and the world now, having made up its mind that it will conduct its affairs by every means except that of common sense, is devoting the whole of its surplus technique and, in many cases, more than the surplus, in preparation for war. There is accompanying that movement a corresponding damping down of civil industry and a diversion of production and supply from consumer goods. The only result can be a rise in the prices of the things that the people need. It is a vital matter and the Government should give their careful and earnest consideration to it.

I should like to ask the Government what their policy is with regard to the level of prices. In 1931 it was assumed without question that the policy of the Government was to raise world prices. Their problem was to prevent the producer being driven out of business and made bankrupt. He was in extremis and in danger of being swamped by the productivity of his former efforts. There were enormous stocks of wheat, tea, rubber and almost anything else one can think of. Is the policy of the Government to-day still to raise the level of world prices? If it is not, what is the policy which has taken its place? The policy in 1931 was to save the producer. The policy in 1937 should be to save the consumer. The only sensible policy, the circumstances having changed, is to protect the consumer from exploitation and from having passed on to him any charges which can be avoided.

I hope that the right hon. Gentleman will be able to give us an indication of the policy of the Government. Perhaps the policy may be described in a way which was familiar to him in another connection as a policy of partial de-restriction. We see that working in connection with steel. The policy indicated in 1931 to save the producer was a policy of restriction and control. Is the policy of the Government to-day giving place to one of de-restriction and de-control and, if so, on what basis is it proceeding? I do not want to pursue this matter further, because it might take me wide of the mark in another direction. The point is whether de-restriction, if that is the policy of the Government as indicated by their policy in regard to steel, is to proceed partially on a purely bargaining basis, or whether it is to be on a wider scale on the basis of international co-operation which is now so much in the air, and which would be a benefit both to the producer and the consumer.

My hon. Friend above the Gangway referred to the question of the price of tea. The whole policy of the Government with regard to tea miscarried when the duty was placed on. When the Prime Minister, as Chancellor of the Exchequer, imposed the extra duty, he said that he wished to put it on because he was looking for a means whereby everybody could make some contribution to the new defence expenditure. The actual consequence of doing it was that that is precisely what did not happen, and more than 50 per cent. of the consumers of tea paid nothing more, because the habit of this country is to buy tea by price. People who have been accustomed to pay 2s. or 2s. 6d. for tea go on buying it at that price. The retailer by altering the quality of the tea, continued to sell at 2s. and 2s. 6d. The consequence was that the people who had been buying tea at that price did not contribute the extra duty; they merely bought for the same price a tea of a slightly inferior quality. The whole of the burden was placed on the poorest people who can only afford to buy the cheapest blends of tea in which there was no margin for the retailer to do anything to lower its quality. The result was that the whole of the buying capacity of the country was concentrated on the cheapest qualities of tea, with the result that it went up from 5d. or 6d. to the present price for common tea of 1s. 1d. or 1s. 2d. Everybody, therefore, did not pay the contribution of 2d. Something like 50 per cent. paid it and those were the people who could least afford to pay it.

The rise in the cost of living in relation to social services is a vital matter. If the rise goes on it will cease to become a vital matter to many people; it will become a mortal matter, and may well lead to an increase in the mortality rates. The mortality rates vary according to the standard of living and the nutritional basis upon which the people have to live. I should like to ask my lion. Friend who is representing the Minister of Labour what the views of the Minister are on that point. Is he making any preparation for dealing with the situation which will undoubtedly arise if the cost of living goes much higher? The standard benefit is fixed by this House and by law. What will be the attitude of the Unemployment Assistance Board if the cost of living rises another 10 points between now and Christmas? Will they alter their scales? If they do, it will mean that the people who are drawing allowances from the Board will get an automatic increase, while those on standard benefit will have to wait until some relief is given by this House. Would the Board regard a further 10 per cent. rise as a special circumstance which would enable them within their existing powers to make higher grants to those who come to them for assistance? An important question of policy is involved here, because the Board, being charged with relieving the necessities of the people, seems to be obliged to take action on lines which will put people who receive assistance from them in a better position than those who are receiving standard unemployment benefit.

These are two considerations which I regard as of vital importance, and I hope that the Government will give them attention. In particular, I hope they have some policy. It cannot be the policy of continuing to raise prices, because that object has been effected. Equilibrium has been established between supply and demand in the case of a great many com- modifies. The next danger which the Government and the country will have to face will be the disequilibrium, financial and commercial, which will come about if there is a further steep rise in the cost of living, because that would upset wage rates, benefit scales and everything else. The discussion to-day has been on one of the most important domestic concerns which the Government and the country have to face.

5.16 p.m.

Sir A. Wilson

I have listened, as I always listen, with the greatest interest, and often with admiration, to the speech of the hon. Member for Gower (Mr. Grenfell). I am fortunate in being called so soon after him. I question whether the hon. Member for Birkenhead, East (Mr. G. White) is correct in saying that there is any ascertainable relation between mortality rates and the cost of living. My impression is that when we were rather short of food in 1914–18 there was an actual diminution in mortality, and at the present moment the expectation of life at any given age above five in Germany, which unquestionably has no surplus of food, is four years in excess of the corresponding expectation in this country. I hope we shall never try to equate the cost of living with mortality rates, for there is much more in life than merely keeping alive.

Mr. White

I shall be glad to discuss the matter with the hon. Member on a suitable occasion.

Sir A. Wilson

I will not attempt to bandy statistics with the hon. Member for Gower, but as I read the figures the wage rates in this country are relatively slightly higher than they were in 1929 and the cost of living is slightly lower. What seems to me to have happened, and I should very much like to know how far hon. Members opposite agree with this, is that as a result of the abnormally low prices of food for the past five years those of the community who are on the lowest wage levels have become accustomed to spending rather less on food and rather more on other things—not essential, but conventional needs—desirable minor comforts of life—on which they had hitherto spent less. I do not gather from the hon. Member for Gower that he thinks there has been as yet any reduction in the quantity of food con- sumed in this country. I understand that the quantity of meat eaten is going up rather rapidly, in spite of higher prices, as also of butter, margarine, cheese, milk, beef and even bread—although 10 per cent. less bread is consumed than was the case ten years ago—our consumption is still increasing. There is an increase in the total consumption of food, and that is not entirely consistent with his suggestion that slices of food are being taken from the homes of the lower paid members of society.

There are many other things to be considered than the cost of living. To begin with old age pensions, unemployment assistance and other quasi-eleemosynary grants have taken a great deal of responsibility from a large number of working-class families. There are, on the average, fewer dependants in a family than there were in 1929—fewer dependent children, fewer dependent old people, fewer dependent unemployed persons. There is more money per head to spend in any given family than there was in 1929. That was precisely the object of that social legislation and it is a matter of congratulation, but it does not absolve us from considering very carefully the figures placed before us this afternoon. The cost of clothing has gone up a little, but nobody can doubt that the population as a whole is better clothed than it was.

The figures which my hon. Friend got from the Ministry of Labour monthly returns relate only to the insured population, and only, as I understand it, to a section of that insured population. There is a considerable weekly wage-earning class which is not covered by any of those statistics. When the Chancellor of the Exchequer referred to £1,000,000 a week in wages, or £50,000,000 during the year, he did not claim to take into consideration the additional wages of the uninsured wage earners and other large categories of wages which do not come into the Ministry of Labour's calculations. The Ministry of Labour figures are of very limited value when one wishes to draw any broader deductions from them than the Ministry makes itself. I agree with the hon. Member that we want many more facts before we can make reliable deductions. Rent is a bigger proportion of the cost of living index now than when it was last calculated. That is one of the inevitable results of better housing. It is also one of the results of the immense transference of labour from one part of the country to another. There are probably more men now living in lodgings than at any time in the history of the country. There has been a vast movement into London recently. Profiteering in lodgings is proceeding on a very large scale; and nothing can stop it. A charge of 25s. a week for bed and breakfast and a poor supper is an ordinary rate. It is the rate which the Ministry of Labour itself has to pay for men under training in its establishments. There is no real justification for such a high level. In villages in my own constituency, such is the pressure of the population coming from the North to work in the South, that people ask 25s. a week for lodgings, and I know places where a man is asked 30s. a week for bed, breakfast and dinner.

Building societies are still extending their activities; and I am more than doubtful as to the eventual social consequences. I have heard of a district not far from London where 20,000 houses are on mortgage and 7,000 were foreclosed in a period of 12 months. I doubt whether more than one man in ten who starts paying for his house by instalments will ever see that house his own. Before he has had an opportunity of paying 20 years' instalments he will have been compelled to go elsewhere to find work and we all know that when a man has paid, say, seven years' instalments on the capital value of his house and wishes to transfer it to somebody else, he seldom gets anything more than an offer to take the place off his hands. There is a good deal of hanky-panky going on in that connection which needs serious investigation, for rent is one of the major items in the cost of living to-day and, unlike the case of food, one over which the Government could usefully exercise some control.

Transportation was not mentioned by the hon. Member for Gower. In his constituency the cost of transport is not, I believe, a very big item, for his folk are lucky to live mainly on the job or near it; but round London there are hundreds of thousands of men not drawing more than 50s. or 65s. a week who have to pay 10s. to 12s. or even more a week to get to their jobs and back. One of the results of re-housing people in big housing estates on the outskirts of London, like Dagenham and St. Helier, is that the cost of transport has become a heavy item for people.

The moral is that we should decentralise industry. I fear that we shall have to wait for the report of the Royal Commission before we can do much, but let us do what we can now, so that men have not to travel such distances as they do now. Let us also give every encouragement to men to use bicycles to get to and from their work, because if they could use their bicycles, if there were facilities for parking them, which there are not in London, that would enable many men to save large sums now spent on transport. It is no credit to London, and to Westminster in particular, that whereas facilities have been provided for parking cars in public squares there is no single place where the cyclist can park his bicycle under cover for a penny or twopence a day, and there are thousands of men who cannot find room for their bicycles in the offices in which they work.

The true standard of living in this country, as I see it, may not have risen, but the standard has unquestionably become more costly. Roughly speaking there has been a 20 per cent. increase in the last six years in the consumption of tobacco, cosmetics and sweetmeats, and in visits to cinemas, and an increase of something like 10 per cent. in the consumption of liquor. The total sum expended on such things works out at something like 250,000,000 to 300,000,000 a year. Those are luxuries or near luxuries. I do not either decry them or resent the expenditure, but it is clear that the standard of living of a very large section of the population has become somewhat unbalanced. Perhaps it is partly due to the pressure of advertisements that we are consuming less of some essential commodities like fish and bread, and vastly more of quasi-luxury commodities like tobacco and cosmetics

The cost-of-living index ought to be divided, I suggest, into two or three separate concurrent categories: first, the elementary needs of mankind; second, conventional needs or reasonable requirements, such as a certain amount of tobacco, a certain amount of recreation, etc.; thirdly, borderline needs, aesthetic and cultural, equally necessary but forming a separate item in any fair cost-of-living index. The last item would consist of luxuries, which could be dispensed with. I do not hope very much—and here I differ from the hon. Member for East Birkenhead—from the cost-of-living index inquiry. It is really almost impossible to form a cost-of-living index which applies accurately to any large section of the people. I would sooner see it split up into 50 or 60 different cost-of-living indexes for different communities in different parts of the country. It is possible, in a given area, to arrive at a pretty fair level of average expenditure for people on similar wage levels and to watch its fluctuations, but a cost-of-living index for the whole of England is, however carefully it is done, I believe, actuarially of little value.

I am entirely in agreement with both speakers who preceded me in thinking that what we ought to go for to-day is a reform, not drastic but steady and pertinacious, of every aspect of distribution, on a very wide front without any particular preconceived, dogmatic views. The hon. Member for Gower said nothing of co-operative societies. They know to what extent the cost of materials has affected the cost of distribution. Co-operative societies in various parts of the country, although they are to all appearances equally efficient, work, in practice, with very different margins. We are dealing with a very big subject and I do not think its problems will be solved by Socialism or distribution, but by a steady drive by all parties, both inside and outside this House, toward getting the best value for money and ensuring real efficiency.

May I take a few small items such as, to begin with, rates? These are a charge upon distribution, and, as a consequence of derating, are much heavier in areas which are technically distressed, populous and poor, than in relatively prosperous areas, and give rise to a vicious circle. Some municipalities, with an unholy passion for hygiene, have gone so far as completely to prohibit the right of hawkers to sell fish by retail in the streets. the immediate result, in certain parts of London, has been to double the price of fish, which is now not consumed at all in areas where very large quantities were formerly consumed. Hawkers have been driven out of the trade. That has not been to the interest of the working class, who prefer to get fish fresh from the barrow when it is cheap than from a shop at a uniformly higher price, and not always fresher.

Profiteering has been referred to, but I am much less concerned about that than I am about promoting efficiency. Attempts to stop profiteering have nearly always failed in the long run, and there are many organisations like co-operative societies, and even municipalities, who can step in if they wish to do so. I believe that the hon. Member for West Bermondsey (Dr. Salter) once stepped in to stop profiteering in a particular commodity, and with complete success. Attempts to promote efficiency are something quite different. Now that prices are rising and the cost of living is rising too, and when it is more than ever necessary to bring down the cost of living, is the moment for considering whether the cost of dying ought not to be included in the cost of living. The cost of dying, as represented by insurance premiums paid by the lower classes, is an item in the cost of living which represents anything from 2½ per cent. to 5 per cent, for the ordinary man. I do not want to weary the House with a discussion on that theme, but I would point out that the present cost-of-living index makes no reference to insurance premiums against death.

What the Ministry of Health might usefully do is to ascertain whether the burial boards in this country, of which there are nearly 2,000, are giving us the best service they can. The price of a grave has more than doubled in the past 20 years. Only one city in England and Scotland gives an advantage to persons insured under the National Health Insurance Acts, and that is Glasgow. It provides a special low fee for the cremation of insured persons. Burial costs are, roughly speaking, £1,000,000 per annum in this country, of which something like £7,000,000 to £8,000,000 falls upon wage-earning classes. The hon. Lady the Member for Jarrow (Miss Wilkinson) may be surprised at that figure, but I think she will find, on further examination, that it is correct. It is a serious item and is steadily going up. I am brought to the subject by a letter which was put into my hand when I came into the House. It is from a young man who begs me to find some way whereby he can avoid a. pauper's funeral for his brother, for neither he nor I have not been working long enough to save, and they tell me it will cost £25. That is equivalent to three months' wages for that young man, a perfectly grotesquely excessive charge, and a real item in his cost of living for a long time to come.

For the rest, I beg my hon. Friend the Member for Gower not to imagine that on this side of the House, because we give confidence to our constituents by referring to the very general increase in employment, we are deceiving them or ourselves. The increase in the consumption of commodities in this country has no parallel anywhere else in Europe and it is still going on. We are still the great market. I do not differ from the figures which he quoted, except that I am by no means sure that his wage rates were right. In any case, the figures as quoted still do not justify the assumption that governments should intervene at this stage to bring the cost of living down. I would far rather the Government did their very best, through the Food Council and otherwise, to prevent a further rise. I believe that can be done. I do not think that we can or should try to maintain the cost of living at the 1931 level. I believe that the present cost of living is about right, and that there is no large element in it of profiteering.

Of this I am certain: we shall not indefinitely be content that those two classes of the community upon whom we depend for food and warmth, the agriculturists and the miners, should be paid on the average far less than workers in comparatively sheltered occupations, which I will not specify but of which we are all aware, and which are, relatively speaking, soft jobs. I speak as a Member for an agricultural constituency with no miners, but I have always regarded miners and agriculturists as in the same position. The cost of living hits them first, before anybody else, and that fact should be recognised. We are apt to be too pessimistic in this House in regard to the cost of living. So long as the amount of money paid out in wages continues to increase and the chain stores, who sell luxury articles, continue to report a steady increase in the demand for cheap luxuries—the chief increase being in the north of England—I see little reason to deplore the rise in the cost of living. Little as we may like the purchase of cheap-jack stuff of various kinds in chain stores and elsewhere, I would far sooner let people spend their money how they like than compel them to spend it upon particular commodities. As the late Marie Lloyd said: A little of what you fancy does you good. Lord Macaulay, 105 years ago, ended a review of Southey's "Colloquies" by a reference to the state of affairs at that time, when people were talking very much as the hon. Member for Gower talked to-day. He said: The present is a moment of great distress. We have just passed through a war compared with which all other wars sink into insignificance: taxation, such as the most heavily taxed people of former times could not have conceived; a debt larger than all the public debts that ever existed in the world added together; the food of the people studiously rendered dear; the currency imprudently debased and imprudently restored.… The tide is evidently coming in. If we were to prophesy that in the year 1930 a population of 50,000,000, better fed, clad and lodged than the English of our time will cover these islands … that machines constructed upon principles as yet undiscovered will be in every house, that there will be no highways but railroads, not travelling but by steam … many people would think us insane… We cannot absolutely prove that those are in error who tell us that society has reached a turning point; that we have seen our best days: but so said all who came before us, and with just as much apparent reason. I believe that we are as much justified to-day in looking forward with confidence to the future as was Macaulay in 1830.

5.28 p.m.

Mr. Batey

It is important, just before the House adjourns for the long Recess, that we should have an opportunity of discussing this question, which has a most important effect upon large sections of the community and is well worth the attention of the House of Commons. Next week, Members may be going upon platforms and telling of the prosperity of this country and how well the country is doing. When they are busy in that way, I want them to remember that there is a class which I hope they will not forget, and I would ask them what they propose to do for that class. I do not intend to go into the details of items in the cost of living. I am prepared to admit that trade is better than it was last year, but the cost of living has been increasing during the last five years. We have an opportunity to-day of asking the Government what they are going to do for people who are not benefiting by the prosperity of the country and whose position is becoming worse because of the increase in the cost of living.

We want to bring the Debate back to that class of person receiving old age pensions, widows' pensions and relief under the Unemployment Assistance Board, and to ask the Government what they propose to do for those people. Trade may be prosperous and the sun may be shining, but there is no sunshine for the people to whom I refer. They are still in the shadow. We are entitled to ask the Government what their proposals and their policy are and what they are likely to do for those people, even when the House meets again. My colleague the hon. Member for Leigh (Mr. Tinker) put a question to the Prime Minister on Monday asking whether he was aware of a resolution passed by the annual conference of the Miners' Federation to the effect that old age pensions should be increased to £1 a week, and whether consideration would be given to this appeal when legislation for the next Session of Parliament was under review. My hon. Friend, in reply to that question, simply received the cold shoulder. The Prime Minister gave him to understand, and gave the House to understand, that the Government had no intention of preparing for legislation during the next Session of Parliament so far as old age pensioners were concerned. We believe that, in view of the rise in the cost of living, cases of this kind ought to receive the consideration of the Government.

A report has been issued covering the administrative county of Durham with regard to persons in receipt of contributory old age pensions and persons in receipt of non-contributory old age pensions. It is for the week ending on 17th April, 1937, and it shows the numbers of these people who have to seek Poor Law relief. In the case of 1,121 married couples where both the husband and the wife were receiving pensions, the cost to the public assistance authority of assisting these pensioners, together with a small number of dependants, by Poor Law relief, was no less than £469. In the case of 1,717 married couples where the man only was receiving an old age pension—this was under the contributory old age pension scheme—the wives had to seek Poor Law relief. In these cases the wives had been refused pensions because they had not reached the age of 65, and only the husbands were receiving the pension of 10s. a week. That cost the administrative county of Durham, for the week ending 17th April, 1937, no less than £1,456. I shall have a word or two to say later with regard to these women to whom the Government are refusing pensions, but let me here say, Mr. Deputy-Speaker, lest you may have it in your mind that I am thinking of legislation, that there is a step before we get to legislation. That step, which I believe to be essential, is an inquiry either by a Departmental Committee or a Royal Commission or in some other way. I believe it to be essential that there should be such an inquiry, and that is what is in my mind, and not legislation.

The Durham figures show, further, that in the case of married couples where the wife only is in receipt of a contributory old-age pension in her own right, the cost to the public assistance authority in respect of 12 cases was £9 for the week. Of single persons and widowers there were 1,466 men and 1,134 women pensioners, and the cost to the authority for that week was £901. As regards persons in receipt of non-contributory pensions, there were 582 married couples where both husband and wife were receiving pensions, and the cost to the public assistance authority was £246 for the week. In the case of 337 married couples where the husband only was receiving an old age pension the cost was £270; in the case of 37 married couples where the wife only was receiving the "70" pension the cost was £30; while of single persons—widows or widowers—there were 941 men and 1,251 women, and the cost to the authority was £734 for that week. The total cost to that authority for relief to old age pensioners, which we believe to be the duty of the Government to provide, was no less than £14,115 for that one week ending on 17th April, 1937. It is not fair that the Government during the Recess should go and remind the country of its prosperity and not at the same time tell this part of the story of how these many thousands of old age pensioners are compelled to go to the Poor Law to get relief in order to help them to live. With the cost of living increasing, and with the prospect of its continuing to increase, that condition of things will become worse, and therefore we are entitled to ask the Government whether the time has not come when they should make some inquiry to ascertain whether old age pensions cannot be increased. I know that the Financial Secretary to the Treasury, in answer to a question not very long ago, said that it would cost £75,000,000 to increase old age pensions to £1 per week for men and to 35s. per week for a man and his wife—

The Financial Secretary to the Treasury (Lieut.-Colonel Colville)

I think the figure was £35,000,000 for a 5s. increase of pension.

Mr. Batey

Yes, but I am speaking of the figure of 35s. per week for a man and his wife. In answer to a question in May last the Financial Secretary said: I am not clear what classification of cost the hon. Member desires as regards pensioners. On 4th May I informed the hon. Member for Hemsworth (Mr. G. Griffiths) that the additional cost of increasing pensions at 65 to all old age pensioners (including widows) to £1 per week (with 35s. for a married couple) would be about £75,000,000 a year at the present time, rising to about £95,000,000 a year in 20 years' time. The question for me is not what it would cost in 20 years' time, but what it would cost now. If we accept the Financial Secretary's statement that to-day it would cost £75,000,000 to increase old age pensions and widows' pensions from 10s. per week to £1, and in the case of married couples to 35s., I submit that, if the Government desired to do so, they could raise that £75,000,000, and it ought to be one of the duties of the Government to ascertain whether there are not resources that could be tapped to-day in order to get this money. It is not fair that old age pensioners to-day should have only 10s. per week and should have to apply to the Poor Law authority to get further assistance to enable them to live.

There are other classes of cases to which we desire to direct the attention of the Government. We have raised in the House the question of widows' pensions. We believe that all old age pensioners who have been engaged in insurable occupations should be entitled to old age pensions, and in the case of widows' pensions also we believe that the fact that their husbands have been engaged in insurable occupations should be the gateway entitling those widows to a pension. I have here a letter which was sent to my colleague the hon. Member for Blaydon (Mr. Whiteley) only this week, drawing attention to a class of case to which we had not the opportunity of referring a few nights ago on the Adjournment. It says: I would like to draw your attention to the very unfair conditions imposed by the Widows Pensions Act of 1936. According to the Act a woman becoming a widow before the year 1936 loses her own pension of 10s. weekly, as well as the pension for the next child upon leaving school. As a widow myself, whose pension has just ceased, I am 45 years of age, and according to the Act I have to wait 10 years before I regain my pension. I would like respectfully to ask how I am to live without any income of any sort now that my pension has ceased. The writer then goes on to refer to the fact that some war widows are receiving pensions without qualification, and some are not, and she concludes by asking that all widows should be placed on the same level.

There are two points in this argument. We believe that all widows should be entitled to pensions, and that, since 10s. a week is not sufficient to enable them to live, they should all have a pension of £1 a week. Therefore, we take this, the last opportunity we shall have before the end of the Session., to ask the Government to give their serious consideration to this question. It is a question that is bound to be raised, not only in this House but in the country, and it is one of the things that the Government will be bound to face in the very near future. We hope they will not ignore it.

In dealing with the question of widows' pensions, I want to say a word or two with regard to some cases which we have already debated but which we think are worth referring to again. Not many weeks ago we raised on the Adjournment the question of widows who were prevented from getting the widows' pension, because their husbands had not succeeded in paying 104 weekly contributions or getting 104 stamps on their cards. What has surprised me since we debated the question is the huge number of widows who wrote complaining that they had been prevented from having the pensions simply because their husbands had been short of the 104. stamps. It was never expected by the House of Commons when we passed the Widows', Orphans' and Old Age Pensions Act that we were simply laying traps and thinking of certain words which would prevent widows getting the pension.

Mr. A. Hopkinson

Before the hon. Member sits down, will he favour us with a few remarks on the subject now before the House?

Mr. Batey

If the hon. Member does not know it, we staged this Debate purposely for this question. We want to bring this question before the House, that the cost of living is increasing and pressing more hardly upon these people, and I hope it will be debated more and more as the day goes on. These people are prevented from enjoying even their 10s. a week through a device that we never expected. We expected that we were passing an Act to take in all widows whose husbands had been insured. I want the Government during the Recess seriously to reconsider the question of removing this 104 stamps qualification and making it instead that, so long as a man has been engaged in an insurable trade, that should be sufficient to entitle his widow to a pension. We believe that old age pensioners' widows all ought to have the pension and that it ought to be bigger. We believe, too, that there is another class of case that comes under the Unemployment Assistance Board which deserves consideration. The cost of living has been gradually but surely increasing during the last five years and unemployment assistance has during the last few months been gradually reduced. The present is not the time to reduce anyone's benefit. We ask the Government to give serious consideration to all these classes of people who are suffering and to whom prosperity means nothing. We ask them to tell us what their policy is and when they mean to take steps to increase the benefits and the pensions of these people.

5.50 p.m.

The President of the Board of Trade (Mr. Oliver Stanley)

It would probably be for the convenience of the House that I should make a few remarks now, leaving my right hon. Friend the Financial Secretary to wind up. The Debate was opened by the hon. Member for Gower (Mr. Grenfell) in one of those speeches with which he often interests and holds the attention of the House, a speech full of figures, with some of which, perhaps, we disagree, but also full of real and genuine feeling. Already a high standard has been maintained in the Debate but, even so far as it has gone, it is an extraordinarily difficult one for any single Minister to answer. We were warned that it was to be about the cost of living, but already we have touched such different subjects as the formation of the cost-of-living index, the necessity of garages for bicycles, the rent of single men's lodgings, the insurance premium for funeral expenses, the price of grain, and the amendment of the various Acts dealing with widows' and old age pensions. I am sure the House will sympathise with me and will realise that, unless I was Minister of Health, Home Secretary, Minister of Labour, Minister of Transport and the Chancellor of the Exchequer, as well as myself, all rolled into one, I should find it hard to give an authoritative answer to all the points that have been raised.

What I propose to do is to make this division between myself and my right hon. Friend. I intend to deal with the general question from the point of view, after all, which applies most to my own Department and, as far as I can, to answer the challenge that was thrown out by the hon. Member for Gower that we should show the other side of the picture and to reply to his allegation that it is the network of tariffs and duties and other restrictions for which the Government are responsible which has been so largely the cause of this rise in the cost of living. My right hon. Friend, when he winds up, proposes to deal more with what the effect of this rise in the cost of living has been on the various classes of the community to which reference has been made. Before I begin my task, may I point out one rather interesting fact? It must be many years—not, as far as I can remember, since the National Government came into power—that one at least of the concluding days of the Session has not been utilised by the party opposite for a discussion on the question of unemployment. I mention that because I think there is some connection between the facts which cause hon. Members to raise this point, and the facts that make them think it unnecessary to use one of these days to raise the question of unemployment. This question of the rise in the cost of living, and Government responsibility for it, has been very delicately touched on by the hon. Member for Gower and the hon. Member for East Birkenhead (Mr. White). They touched on it in a statesmanlike manner, of course making no political capital, but the same story is told by their supporters outside, and it is told in a simpler form. The allegations that we have to meet are, I think, first of all, that there has been a rise in the cost of living, secondly, that the Government have put tariffs and quotas upon foodstuffs. We go on from that to the natural, but quite wrong, deduction that it is the wicked National Government that has been responsible for the dearer food of the people, and proceed by easy stages from that to what I believe to be the equally inaccurate statement that a benevolent Labour or Liberal or Popular Front Government—depending on the particular speaker and the particular audience—would make the food of the people cheaper.

I want to deal with those four points, which I have summarised in a way which, I think it will be admitted, is fair from the point of view of the platform speaker. I am going to confine myself almost entirely to food prices, because in the view of the people as a whole, that is what bulks most largely in this increase in the cost of living figure. There has, of course, been a rise in the cost of food over the last few years. I make no attempt to deny it. Indeed, official figures that have been published make any denial fruitless. The cost of food is to-day above what it was 12 months ago. It is still more above the year 1933 which the hon. Member for Gower selected as the basis of his comparison. I would point out the rather significant thing that that year, which is in fact the year in which the cost of food index was lowest, was also the year which all of us would select as that in which the industrial depression touched its lowest point. There is a very significant connection between those two facts. Though it is true that the cost of living has risen if you compare this year with last year, or even with 1933, it is not true if you compare this year with the years that were less abnormal than 1933, 1932 or 1931—if you go back and compare it with the cost of food index for the last normal period with which we can compare it. As the hon. Gentleman, with the fairness that he always shows, admitted, the cost of food index is still below what it was in July, 1930, and it is considerably below what it was in 1929. I will later on discuss both the cause and the effect of that difference.

I want now to proceed to the second point, the fact that this Government has put tariffs, quotas and other restrictions on food. There, again, that is a fact which no one on this side denies. It has been part of the declared policy of the Government to attempt to re-establish agriculture on a paying basis. That is a policy of which we are not ashamed and which we can justify on many grounds, from the point of view, first of all, of the security of the country and the essential assistance that a stable and prosperous agriculture would be to us in a time of emergency. Hon. Members have recently been converted to a rather belated, and still passive, acquiescence in the policy of rearmament, but I am sure they will admit that guns, aeroplanes and ships are useless without food behind them. There is the social effect of the crowding of the agricultural population into the towns. I do not think anyone will deny that it is essential for the well-being of the country that we should have, as far as possible, a balance maintained between the industrial producer on the one side and the primary producer upon the other. It may be that measures taken in the last century destroyed, and destroyed perhaps for ever, the possibility of an optimum balance between the two, but, at any rate, we should find what balance it is possible to get between them. Even in the last few years we have seen only too patently—and hon. Members opposite have seen it more closely—the terrible effects on one industry of the lack of economic balance in a district, and I believe that the lack of economic balance can be just as terrible in a nation, and that a nation with a one-sided economy is in just as vulnerable a position as one industry.

Fortunately—and this is perhaps a relevant consideration to the particular thing we are discussing—although it sounds paradoxical, the assistance that has been given to agriculture in the way of tariffs and quotas has deliberately been chosen to raise the price which the farmer receives, and it is in the end to the interests of the consumer as well as the interests of the producer. It is to the long-term interest of the consumer that some considerable proportion of agricultural production should take place here under our own control and the control of the Government of the day and of this House, because only so, I believe, have we some check upon external forces which may be reacting on the prices of our imported foodstuffs. An attempt to maintain this element of home production may seem to be only a drag upon us, when we are living in the days of a world glut, and when it appears that, with an immense potential capacity all over the world for producing food, we have only to throw our ports open to receive, from all parts of the world, food produced at a competitive price, and, therefore, at a price which suits the consumers of this country. I wonder whether we can be so certain that we are going to live for ever in this world of glut. Although I do not pretend to be an expert on world agriculture, I am not so sure that we can depend as securely as we have on the continuous growth of agricultural production in the world as a whole. The recurrence of droughts in some of the agricultural districts of America, and what appears to be a permanent fall in the production value of these lands, is beginning to make one wonder whether we have not spent or are not reaching the time when we shall have spent a great deal of the fertility of these new soils which were discovered in the past century, and whether, in the future, we are not going to move backwards.

Mr. Maxton

Where did the right hon. Gentleman get hold of that philosophy?

Mr. Stanley

I am afraid I must confess that I got it out of my own head. Do hon. Gentlemen attach more importance to extracts from Blue Books or quotations from the words of economists? Then I am afraid it is a sad confession to make, but I do not think that it is a bad thing that we in this House should sometimes try to use our own ideas.

Sir A. Wilson

Does my right hon. Friend realise that he has ample scientific backing for it?

Mr. Maxton

So we have two great authorities.

Mr. Stanley

I am obliged to my hon. Friend. Anyhow, whether it is in glut or in scarcity, it is a real insurance to the consumer of this country that there should be a considerable portion of it produced over here, and it is particularly important when at any moment, as I believe, and in fact as has been happening in the past year, what was before a buyer's market may turn into a seller's market. There is, after all, one very great difference between agriculture and industry when you try to insure against these sudden fluctuations. It is the very simple fact that you cannot put a cow on short time. On the other hand, if your factory is producing more than it can dispose of at an economic rate which enables you to pay the wages demanded by the trade unions, you can at any rate close down that part of your production and put the workers upon short time. But you cannot do that with the cow. If you find that the milk which the cow is producing cannot be sold, the inevitable result is that the cow is killed, and if the demand increases, instead of being able simply to reopen that unit of the factory which you closed down, you have, if you want to produce milk again, to go through those long and laborious processes, which I need not describe, which are necessary before a new cow can be produced. Therefore, I make the point that it is quite clear that it takes much longer to adjust your agricultural production to the situation at the moment than it does to adjust your industrial production.

If you are to insure consumers against being suddenly caught by a scarcity of imported goods, it is necessary that you should maintain a quantum of production in this country over a period. I do not deny, therefore, that for all these reasons it has been one of the main objects of our policy to secure that a proper price for foodstuffs should be payable to the farmers in this country who produce them, but I would point out to the House that we have been careful not to try and maintain that policy by merely adopting doctrinaire methods, by saying that there is one way of obtaining our object which we shall apply to all branches of agricultural production. Many people complain that our agricultural policy is so complicated that we have tariffs here, subsidies or quotas there. The explanation is that we have attempted in every case to maintain the balance which, after all, we have to maintain between giving the maximum assistance possible to the producer and causing the minimum of inconvenience and loss to the consumer.

When hon. Members opposite blame the Government and blame me for having done too much in this direction, they must also remember that the Government and I are very often blamed by hon. Members who sit behind me for not having done enough. It is largely put down to the President of the Board of Trade when some particular form of protection for the agricultural industry is not given. Some hon. Members behind regard the Minister of Agriculture as a sort of fairy godmother with a golden wand, and, in recent years, with a strong Scottish accent. The President of the Board of Trade is the wicked stepmother, whole only role in life is to intercept the gifts which otherwise this bounteous fairy would bestow upon the community. It is quite true that my immediate consideration is industry and that his immediate consideration is agriculture, but for both of us the fundamental consideration must be, as I said before, a balanced economy between agriculture and industry. I realise, as he must, the importance of agriculture and of all who depend upon agriculture as a market for industry. He realises, as I must, not only the social effect, but also the industrial effect of this rise in the cost of foodstuffs.

As my particular responsibility is for industry, I remember that food, after all, is the greatest raw material that is used by the industries of our country. It is my business, therefore, to try, if I can, to maintain this balance between the two and to see, if possible, that there are no undue or abnormal rises in the cost of food to the people of this country. It is essential, first of all, if that is to be avoided, that the arrangements for the protection of our agriculture shall be flexible in character so that we shall be able to adapt them with some rapidity to the changing conditions of the market in a particular commodity.

I want to give the House only two examples of how that flexibility, in fact, can be found in our system. The first is with regard to beef, one of the commodities mentioned by the hon. Member for Gower. In this case there is an international conference which is regu- lating the supply of beef to this market. It was found at the beginning of the year that there was a sudden and quite unexpected increase in the demand for beef, largely, I believe, on the Glasgow market, and the result was that, by general agreement between all parties, including, I think, the representative of agriculture over here, immediate arrangements were made for an additional quota of a substantial amount to meet that sudden demand. Equally it was the case with mutton and larch. No less than twice in the last few months additional quotas have been given the exporters to this country of mutton and lamb in order to meet the growing demand which has been evinced. These arrangements are working with considerable flexibilty, with the object of approximating the supply which comes on to the market to any increase in demand. I agree with my hon. Friend the Member for Hitchin (Sir A. Wilson) who emphasised the importance of distribution, which is a matter continually under our control.

Mr. Shinwell

Under control?

Mr. Stanley

I should have said under review. I said that I agreed with my hon. and gallant Friend. I agree with him that the remedy does not lie in the socialisation of distribution, but it does lie in taking up instances of inefficiency or of excessive cost and endeavouring to get the matter put right.

Mr. Shinwell

Will the right hon. Gentleman, for the purpose of clarifying the position and enabling hon. Members to participate in the Debate with some knowledge of the situation, indicate, when he says that the question of distribution is under review, what the Government specifically are doing in this direction?

Mr. Stanley

For instance, the Food Council have lately been considering the distribution costs of milk, and that report will be available to the Government although I must ask hon. Members opposite to await the statement which the Minister of Agriculture will make upon the question of milk.

Mr. A. Jenkins

I gather that the question of the distribution of beef has been under the consideration of the Government for some time, and may we have some indication of any steps it is proposed to take in regard to better distribution?

Mr. Stanley

I am glad that the hon. Member mentions the question of beef because he will remember that the House has just passed the Livestock Industry Bill, which contains provisions both for the slaughtering and marketing of beef and that, of course, is part of the distribution, and shows what I mean, when I say that the Government have the question of distribution under review.

Now I pass to the next question, how far this rise in food prices, which we all admit, has anything to do with Government action? I do not want to go into the barren controversy of the fiscal fight as to who pays, the consumer or the foreigner. The answer clearly is that you cannot generalise on that subject. It depends upon the particular commodity and the state of the market at the time, whether it is a buyer's or a seller's market, and whether the consumer has to buy or the foreigner has to sell. When attempts are made to prove that the rise in the cost of food in this country has been due entirely, or in the main, to the agricultural policy of the Government, I would point out that agricultural protection started in this country in 1932 and that in 1933–34–35 prices were in each year lower than they were before 1932. No one, therefore, can say that the action of Protection in raising prices generally to the consumer was either immediate or very drastic.

I should like to take two typical commodities. If you made a comparison between the year 1931, the last year of complete agricultural free trade, and this year, you would expect that, whatever was the trend of world prices, here you would find a greater rise in the commodity which we had done more to regulate the import of than in the commodity which we had left almost untouched. The very opposite is the case. If you compare the price of commodities to-day with that of 1931 you will find that the biggest percentage increase has taken place in flour and bread, and yet the price of wheat at the moment has reached a level at which the quota payment no longer works. Now that is the commodity least affected by any action that the Government have taken. Wheat pays the smallest duty, I think, almost of any primary commodity, yet flour and bread are the foodstuffs which show the biggest percentage rise in the period from 1931 to 1937.

Take potatoes. Potatoes are foodstuffs with which the Government have perhaps interfered most. They are subject to duties, to import quotas, to restrictions in regard to the areas of growing in this country by means of a levy, and yet potatoes show the biggest percentage fall since 1931, a period before these measures were introduced. Therefore, we get the anomalous position that in regard to the commodity which is protected most the fall has been biggest, while in regard to the commodities protected the least the rise in price has been the most.

Mr. Bellenger

Do I understand the right hon. Gentleman to say that the rise in flour and bread has been the highest?

Mr. Stanley

I do. I said that wheat was the commodity which had been granted less protection than any other, that the world prices are such at the moment that the subsidy under the Wheat Act does not apply and no subsidy is now payable, and that it is the foodstuff which to-day is least affected by any Government measures. There are, of course, other forces quite different from and much stronger than any Government action which control these matters. We have behind them the world trend in prices which accounts for the major part of these rises.

Mr. Grenfell

Is the right hon. Gentleman not going beyond his case? Did he not state that it was the purpose of the Government to improve the prices of primary products, and is he not now arguing that quota regulations and restrictions have not improved prices?

Mr. Stanley

What I am saying is that it is not possible to maintain the argument that the whole or the major part of the rise in the cost of foodstuffs in this country has been due to any measure of Protection. I should like to go on to deal with what I believe, and what I think everyone will admit, is part of the world trend. It is not only in this country that food prices have been rising. In every country you see the same tendency, and as far as I can judge from the figures in different countries—although it is difficult to make comparison owing to the exchange values—the rise elsewhere has been very much of the same quantum as the rise in this country. Greater industrial activity has produced greater industrial demand and that tendency has proceeded all over the world.

In so far, therefore, as this is a world trend which has been produced by the greater demand, in so far as it has led to a rise in the prices of primary commodities, is it in tact something which in general is injurious to the general health and prosperity of this country? If hon. Members opposite were in a position so to do, would they try to reverse the process and try to bring the cost of food and the cost of other commodities back again to the level of 1933? I do not believe for a moment that they would attempt to do that. We all remember the Debates which took place in the period when the slump was at its worst. I have a number of quotations, which I shall not use, because I do not think that anybody will deny that from all sides of the House it was urged at that time that the only thing that could restore industrial prosperity in this country was a rise in commodity prices. If hon. Members question that statement, I will give them quotations from almost any of their speakers.

Mr. Stephen

Give us some.

Mr. Stanley

Would the hon. Member like a statement from the right hon. Member for South Hackney (Mr. H. Morrison)?

Mr. Stephen

Do not insult us.

Mr. Stanley

The right hon. Member for South Hackney, speaking in 1930, said: The economic blizzard which the late Chancellor of the Exchequer referred to is also an important fact, and the depression of 1920–21 did not see so severe a collapse in the prices of primary commodities as the present depression has done. The House must face the fact that crisis produces crisis, that a depression and collapse in primary commodity prices works round the vicious circle of primary producers, manufacturers, shipping, iron and steel and so on"—[OFFICIAL REPORT, 16th December, 1930; col. 1102, Vol. 246.] I have also a quotation from a man to whom we always listened with the greatest attention however much we differed from him. I refer to the late Mr. William Graham, one of my predecessors at the Board of Trade. He said in 1931: Over and over again hon. Members have asked me in reference to the fundamental trade position, 'Do you see any sign of these prices having touched bed-rock'?—because it is common ground that only when the upward movement begins, will there be any real improvement and confidence in trade or will those numbers of unemployed be progressively reduced."—[OFFICIAL REPORT, 11th February, 1931; col. 537, Vol. 248.] I do not know whether hon. Members opposite want any quotations from other leaders.

Mr. Stephen

Let us have a quotation from the I.L.P.

Mr. Stanley

It is an accepted fact that during that period all of us were urging the necessity of a rise in the cost of primary commodities, including food. We all of us were giving different solutions of the problem of creating the rise, but all of us were saying that such a rise was essential and that it was the gap between the reward of the primary producer and the reward of the industrial worker which suddenly developed in 1929 which had caused the slump, and that until that gap could be lessened the slump would continue. Now we have the conditions that were desired in that period. We all agreed that it would bring assistance to our industrial position and for once everybody was right, because in fact that rise in commodity prices in the past three years has been followed or accompanied, as was then predicted, by a rise in industrial prosperity and a great fall in the number of the unemployed.

I should like to give hon. Members what I consider a very interesting example of the almost immediate effect that the increased price of a primary product in a producing country has upon the demand for industrial goods from this country. It is the example of West Africa. It is a very simple example to take because it affects three primary products mainly exported to this country and therefore any relation between an increase in price of those products and an increase in the exports from this country can be easily and readily seen. The chief products of West Africa are cocoa, palm kernels and palm oil. In 1933–34 the prices of these commodities were extremely low, and the total value of our exports to British West Africa was only £5,750,000. In the next year there was a rise in the price of those primary products from £1 14.s. 3d. to £1 15s. 2½d. for cocoa, from £7 3s. 3d. to 16s. 2d. for palm kernels, and from 12s. 7d. to 19s. 1d. for palm oil. The immediate result was an increase from £5,750,000 to £9,300,000 in our exports to British West Africa. In the next year there was a further rise in the price of these commodities, followed again by a rise in our exports to West Africa from £9,300,000 to £11,300,000. In the first five months of this year there has been a further rise in the price of those commodities and a further rise in the amount of our exports to British West Africa. An example of that kind is well worth giving and remembering.

When the hon. Member opposite talks about the rise in commodity prices having taken bread and meat off the tables of the poorest people, I say that this rise in prices, with the resulting trade given to the people of this country and the taking of people from unemployment and putting them on to wages, has not taken bread and meat off the tables of the people but has been successful in putting more bread and meat upon them.

Mr. Grenfell

Can the right hon. Gentleman deny that the inevitable consequence of a rise in the price of meat and bacon and other things is that people whose income is not sufficient in ordinary circumstances must buy less of these commodities?

Mr. Stanley

My answer is that a rise in commodity prices which takes a large number of people off unemployment assistance and puts them on wages, gives to them an increased purchasing power which more than makes up the difference in prices. If the hon. Member does not agree I would ask him to look at a publication upon which I have no doubt he relies a great deal, a publication issued by the Trade Union Congress. In this month's issue they discuss the figures relating to June. 1937, and they lay it down as a true proposition, with which I agree, that if you make a comparison of this year with the last period of normal trade, with the last period of trade which can be in any way compared with the present year, you will find that in this year real wages have risen by over 11½ per cent. as compared with the average for the period 1925 to 1929.

Mr. Grenfell

Does the right hon. Gentleman mean aggregate wages or individual wages?

Mr. Stanley

Real wages this year are 11 per cent. higher than the average of real wages for 1925 to 1929, which I select, and which they also select, as the last normal period of employment and industry in this country. The real answer to the case of hon. Members opposite is that if in fact the health and happiness of this country depend on commodity prices and food prices falling as low as possible, then the years 1930 to 1933 ought to have been years in which this country had much greater prosperity than was in fact the case. Is there anybody who would like to go back to that period and see our trade and industry and our employment not as they are today but as they were in 1931 and 1932. No one would for a minute desire to do that.

Mr. Shinwell

It is utterly irrelevant.

Mr. Stanley

Does the hon. Member really think that there is no connection between a rise in primary commodity prices and an increase in the industrial activities of this country? Does he think that there is no connection between a fall in primary commodity prices and a recession of business activities?

Mr. Shinwell

Did the Government not claim at the last General Election that they had been responsible for reducing food prices?

Mr. Stanley

I certainly never made the claim, and as far as I know no Member of the Government made the claim that the Government was responsible for reducing food prices. If they had hon. Members opposite no doubt would have pointed to the various measures they had adopted to help agriculture and would have asked them how they squared the two things. In point of fact, they did not make the claim. I believe that the movement of commodity prices has so far been a healthy thing for the industry of the country. The hon. Member for East Birkenhead asked what would be done when it reaches a stage at which it needs the most careful watching, when the rise in commodity prices will have reached the limit of its effectiveness and new circumstances will arise? I do not believe that such a stage has been reached. I think there are still commodities where a reasonable return is not guaranteed to the producer, and it will be the constant effort of the Government to try and ensure to the producer a reasonable return and also see that there are no abnormal or fearful increases in the general cost of living.

6.36 p.m.

Mr. W. Joseph Stewart

I have listened with deep interest to the speech of the President of the Board of Trade, the major part of which was devoted to an endeavour to disclaim any responsibility on the part of the National Government for the rise in food prices. I wish the right hon. Gentleman had devoted a little more of his very long speech to the conditions of the people upon whom any increase in food prices falls very heavily indeed. To me a rise in the cost of living is a matter of great concern. I believe that the application of a wide range of import duties and increased world prices has had a tremendous effect upon the food of our people. Last year the price of tea was raised by 2d. per lb., coal was increased by over 2s. per ton, woollen goods went up by over 10 per cent., and there was a great increase in the price of hardware and other commodities. Flour went up by no less than 13s. per sack. Looking at the Ministry of Labour's cost-of-living figures and contrasting 1st of May, 1934, with the 1st May, 1937, I find that the price of flour has gone up by 37 per cent., the price of bread by 30 per cent., the price of tea by 12 per cent., fresh butter by 20 per cent., salt butter by 28 per cent., cheese by 18 per cent., eggs by 25 per cent., and potatoes by 65 per cent.

Taking these increases into consideration and also the fact that there has not been such a substantial rise in wages, one must come to the conclusion that our people, especially those in the Special Areas, are being very hard hit in the process. Indirect taxation also has played a very important part. We must remember that when indirect taxation is high there is bound to be a rise in foodstuffs, which, of course, hits our people very heavily. In 1930–31, the last financial year before the National Government took over, indirect taxation amounted to £245,401,000, or 28.9 per cent. of the total revenue. Gradually the Government have piled more and more taxation on the poor, and in 1936–37 the total received from indirect taxation was £320,708,000, or 38.6 per cent. of the total revenue. What the Government have done by indirect taxation is to take an additional £75,000,000 out of the pockets of the people, which works out at 2s. 8d. per week for every family in the country. All that the people in the country know is that there has been a substantial rise in the price of foodstuffs, but up to now it does not seem to have been realised that to an appreciable extent the National Government are responsible for the rise.

There is another thing for which the Government are responsible which has had an appreciable effect upon the income of the people. Until 1930–31 people with less than £162 of earned income did not pay Income Tax. The result of the Government's economy campaign was that the limit was reduced to £125. In that way the Government roped in over a million people and by that action reduced the income of these people, limited their spending power and also limited the supplies of food going into the homes. The imposition of duties on common articles of food such as meat. butter and vegetables, is in my opinion wrong in principle and is helping to lower the standard of living of great masses of our people. This is specially the case in the distressed areas of England and Wales. An hon. Member has referred to the heavy taxation in the Special Areas and to the fact that people who are unemployed will have to meet these taxes. The more money that goes in taxes the less is left for buying foodstuffs. I wonder whether the right hon. Gentleman, and the Government he represents, have ever gone deeply into the question of the conditions prevailing in many of the distressed areas in regard to taxation, and considered whether the time has not arrived when something should be done to help these people.

There is also the question of the aged pensioners, referred to by the hon. Member for Spennymoor (Mr. Batey). In Durham County they have become a matter of very great concern. We have 10,000 aged pensioners in Durham, and because of the meagre income of 10s, per week they have to apply to the local public assistance committee to help them to get the necessaries of life. Owing to that fact, Durham to-day is spending approximately £214,000 per annum to meet that problem, which should be met by the National Gov- ernment. If the income of these people is so limited that they cannot exist unless they apply to the local public assistance authorities for aid, what will be their position if, every now and again, an extra penny is put on the price of staple articles of diet which are necessary in every home?

There is then the question of the people who are drawing unemployment benefit. I wonder whether the Government, when imposing indirect taxation and deciding that nothing can be done about the increased cost of living, have ever taken into consideration the condition of tens of thousands of people whose income is always at the same level, no matter what may be the price of foodstuffs. I have no doubt that if the Government had faced its responsibility and dealt with the question of the location of industry, so that those people could have drawn wages instead of the dole, the increased cost of living would not have had the effect upon as many thousands of households in the Special Areas that it is having in present circumstances. We have to take that into consideration.

Many hon. Members live in the Special Areas. They have to stand by and see homes depleted, men depressed, women grown prematurely old, and children ill-clad and ill-shod. Yet nothing is done by the Government to help to get food for the people, to find work for the people and to deal with the question of the location of industries. When one thinks of the condition of those people, one asks oneself whether it is necessary in twentieth century Britain that such a state of things should prevail. We have been told from the benches opposite that it is necessary, in the national interest, that we should look after the physique of our people, that we should build up our youth and our manhood, but. I submit that that cannot be done unless something is done by the Government to make it possible for cheaper food to be bought and for more food to go into the homes of the people. If that is done, perhaps in the near future that for which the National Government hope will be realised, and we shall have a fitter Britain than we have to-day.

6.50 p.m.

Mrs. Tate

Hon. Members opposite are to be congratulated on having asked for this Debate to-day, because I think it has come at an exceedingly opportune moment. Although there has been no very great rise in the cost of food, there has been a certain rise, and I do not think it bears the relation it should do to what the producer of the food is getting. The Minister wondered whether "we could always count on continuing to live in a period of glut," and he said that he thought we might come to the day when we should not live in a period of glut but in a period of scarcity. Therefore, I think it is worth while to look back for a moment and consider whether the people of the country really benefited, as regards food prices, in the way that they should have benefited when there was a glut of food. I contend that they did not. I contend also that there is a greater danger than some people foresee of the increase in the price of food becoming greater without the producer of the food having any relative degree of prosperity.

The right hon. Gentleman referred to the Government's agricultural policy, and said that there had been an attempt to establish agriculture on a paying basis. So far it has not got beyond being an attempt, for in very many parts of the country to-day agriculture cannot possibly be described as being on a paying basis. The hon. Gentleman the Member for Hitchin (Sir A. Wilson), in a very interesting speech, said that he looked to the day when the miners and the farm labourers would no longer be content to live on the wages that they get now, and would demand a greater degree of prosperity. I believe that day is very near. Unlike the hon. Member for Hitchin, I represent not only agricultural workers, but miners; and I fear that the miners whom I represent may have to pay an increased price for food at no distant date, which they cannot afford. I also fear that the agricultural labourers whom I represent will not get increased wages, and still less confident do I feel, that the farmers will be able to afford to pay them higher wages, which will mean that they are not benefiting from the rise in the price of food.

Consequently, I think it is very important to find out what the real causes are for the high price of food. Hon. Members to-day have not made a very great point of it, but it has been stated in contemporary newspapers to be due to the policy of restriction and the policy of tariffs. If that were the case, I believe the problem would be very much simpler than it is; but examination of the quantities of food which have been brought into this country during the last two years and the quantities of food which have been produced does not lead one to believe that the rise in the price of food has been due to restriction or scarcity. There has been a larger consumption in recent years of meat, butter, fruit and vegetables and of most food, with the exception of bread, than there was, even between the years 1924 and 1929.

I have worked out some exceedingly interesting figures which I would like to quote to the House. I will take one lot and will choose the figures regarding pigs, because I think that hon. Members who have spoken on platforms in the country will agree with me that one of the problems which very much perturbs the housewife is the rise in the cost of bacon. I have here the history of pigs from the producer to the curer and to the retailer, and I will give the figures for a pig of 7 score 15 lbs. Until last week the producer was getting for such a pig £4 11s. 0¾d. Last Thursday the price went up a little, and the producer may now expect to get £4 16s. 11d., but during the past weeks and months he has, in fact, been getting £4 11s. 0¾d. He has had to produce the pig, he has had all the risks attendant upon getting it to the stage when it was marketable; he has had to pay farm labourers increasingly high wages, and he has had acute difficulty even in getting labour on the farm. He has had all those risks, and then he has received £4 11s. 0¾d. for his pig. The pig then goes to the curer, and the curer, for 1 cwt. 12 lbs. at £4 16s., can cure and sell the pig again at £5 16s. 3d.

Now I come to the retailer, and I have taken the price at Harrod's Stores, at the International Stores, Victoria Street, which I thought could be regarded as more in the nature of the peoples' stores, of stores in the Oxford and Abingdon district, and in the Bristol district. During the past month, when the farmer was getting £4 11s. 0¾d. for his 7 score 15 lbs. pig, Harrods were getting £8 19s. 1d. for the same pig, selling 18 lbs. of collar at 1s. 2d. a lb., which brings in £1 1s., 4 lbs. of thick back at is. 8d. a lb., which means 6s. 8d., 28 lbs. of prime back at 1s. 10d., which brings in £2 11s. 4d., and the loin at 6s. 8d. I will not weary the House by giving the figures for every joint of the pig, but Harrods were getting £8 19s. 1d. for the same pig as brought the farmer £4 11s. 0¾d. For a similar pig, the International Stores in Victoria Street were getting £8 1s. 5d. In the Oxford and Abingdon districts, Where I have not taken any particular shop but the whole district, they were getting £7 19s. 3d., and in the Bristol district they were getting £8 4s. 11d.

The Minister said that he did not think the time had come when he could have legislative interference with distribution, but I think the time is overdue when there should be a very careful inquiry into distribution. It has got to be investigated. I do not know whether it has ever been done, but it would be extremely interesting to have a survey of the rise in population and the proportionate rise in the number of distributors. I believe that the real wealth of the nation lies in the wealth of the producers. If we have wealthy producers, we have a really wealthy nation. I believe that the backbone of this country is the agricultural industry, and that if we lose that industry, we lose a wealth that cannot be computed in pounds, shillings and pence. I would like to see the producers of coal, as the hon. and gallant Member for Hitchin said—the producers of every kind—wealthier than they are at present.

Why have we this extraordinary discrepancy in the prices paid to the producer and the prices which the distributors charge? It can only he because the number of distributors is far too large in proportion to the population. If one watches the growth of any town in England to-day, the growth of the population and the growth in the number of distributors of milk, for instance, or of meat, or of groceries, bear no comparison the one with the other. This means that each distributor has to make a larger profit than he should have to do out of his small number of consumers in order to keep alive. I do riot think that anyone who knows the position in London, for instance, can possibly say that the number of distributors is not too large. Certainly, no one living in the West End of London would deny that appalling bribery has to go on before the distributor can ever get himself into the house. It is a fact, although a veil is usually drawn over it, that the tradespeople with whom one deals in the West End of London buy their way into one's house by bribery of the domestic staff. That cannot be denied. Unfortunately it is a fact, and one which I have verified on many occasions. Why do they have to do that? If a man is able to pay large bribes in order to get custom, he must charge undue prices for the food he sells in order to make the bribes worth while.

Mr. Gallacher

It is your own crowd you are talking about—private enterprise.

Mrs. Tate

I do not think that the hon. Member could point to a single instance of where the State being in control of supply and distribution has resulted in greater advantage to the community either as to prices or supplies. Under the present system the number of distributors is too large. You will eventually have to have some system whereby a licence has to be obtained before a distributor of a certain kind can set up in a district. In the meantime we should have definite statistics as to the increase in the population and the relative increase in distributors and producers. It is not enough now to know how great a percentage of our people are working on the land. It would be far more interesting to know how great a number of our people are farming the land. That would give a true picture of the prosperity of the producer which is what we need.

7.2 p.m.

Miss Lloyd George

I was very interested at an earlier stage of the Debate to hear the hon. Member for Hitchin (Sir A. Wilson) say that he thought that the cost of living rate had no relation to mortality rates in this country. I would like to cross swords with him on this point immediately, and I wish he were here for me to do it all the more effectively. It is acknowledged that one of the main reasons for the high maternal mortality rate is malnutrition. I seem to remember a report issued by a medical officer—I think in the Midlands—where he pointed out that the death rate had risen in a new housing estate, and he gave it as his opinion that it was because the rents were so much higher and the people had less money to spend on food. The rise in the cost of living has much wider repercussions than that. The hon. Member for Hitchin quoted Macaulay; I would like to come up to more modern days and quote Sir John Orr, who in his very interesting report told us that practically half of the population of this country are suffering from under-nourishment. He said that more than a year ago, when the cost of food had not risen. Since then it has risen, and what is a serious factor is that it is the nutritive foods with the exception of milk that have risen in price. The price of food has risen by 10 per cent. The hon. Member for Gower (Mr. Grenfell) gave us some very interesting figures and some specific instances. I would like to give two only. I would like to take the household of a better-paid worker. There is a family income of £3 10s. a week. If you take the Merseyside estimates, which say that a family spends half its income on food, that family has to spend 35s. on food. They now have to pay 38s. 10d. to get the same amount of food. If you add to that the general rise in the cost of living, they would have to pay altogether 4s. 2d. more on the bare necessities of life.

Mr. Cartland

Compared with what year?

Miss Lloyd George

That is what has happened as a result of the 10 per cent. rise on last year. The hon. Member for Gower spoke of workers who were living on a narrow margin. Take a family of two adults and two children with an income of 33s. a week of which 16s. 6d., according to the Merseyside estimates, would be spent in food. That would not come up to the standard of any authority, including even the Ministry of Health Report. But to-day that family would have to spend 18s. 4d. to get even that miserably inadequate amount of food. If you add the general rise in the cost of living you will find that they have to pay 2s. more, which is a real and serious increase in a small income of that kind. The people who will suffer most are the unemployed, whose incomes are low and whose benefits are fixed, and I hope very much that the Minister of Labour will take into account the point raised on this by the hon. Member for East Birkenhead (Mr. White). Many of these unemployed, through long years of enforced idleness and malnutrition, are not in a fit state now to take a job even if it were offered to them. That was before the rise in the cost of living. How much worse is their position now. It may be said that it is not a great rise—a penny here, twopence there and even ¾d. somewhere else.

I well remember the reluctance with which this House in 1931 imposed a cut of 10 per cent. on the unemployed by the Economy Act. It was said that nothing but a national emergency and a crisis of great magnitude would have compelled us to do it. Nothing but that would have been justification enough. It was said that the sacrifice which was asked for was very great, and it was pointed out how long had been their sufferings. The present increase in the cost of living is equivalent to a 10 per cent. cut in the real income of the unemployed. It seems to me that the unemployed get it both ways. They get it all ways and every way. They get it in the days of depression and in the days of recovery; they get it in days of national stringency, and they get it also in the blessed days of National Government. The hon. Member for East Birkenhead and the President of the Board of Trade pointed out that in all probability the tendency was that the rise was likely to continue. I believe it is perfectly true that buyers in firms are already receiving intimations from manufacturers of a rise of anything from 5 to 20 per cent. in any future orders which may be given.

I would like—and here I find myself in agreement with the hon. Member for Frome (Mrs. Tate)—to link this up with another problem, because they are almost identical. I was glad to hear the President of the Board of Trade take up the cudgels on behalf of agriculture. He said that we must not lose sight of the necessity of assisting the farmer. I think he emphasised a fallacy which, if it gains currency, will do incalculable harm and that is that the farming community is reaping a rich reward as a result of present prices. It seems to me that it is going to be more dangerous if prices continue to rise, because nothing could be further from the real facts. The first conditions of sound and effective agricultural and nutritional policies is to realise that their interests are identical, and that there can be no real conflict between the interests of the town and the countryside. But at the moment the whole tendency is to suggest that there is a bias on the side of the agricultural community. It is said that Parliament has voted subsidies for various sections of the agricultural industry—wheat, sugar beet, beef and milk. That is perfectly true, but for all the boards, subsidies, quotas and every separate stratagem which has been evolved with true Celtic ingenuity by the Secretary of State for Scotland—

Mr. Macquisten

He is not a Celt; he is a Sassenach.

Miss Lloyd George

I am not going into these controversies between Scotsmen; I have had experience of that.

Mr. Macquisten

May I tell the hon. Lady that a man who is born in the Lowlands is only a Scotsman, but a man who is born in the Highlands is a super-Scotsman?

Miss Lloyd George

All that I am aware of is that there is a great kinship of blood between some of the Lowland Scots and my own countrymen. Therefore, I feel that I must disagree with the hon. and learned Gentleman and probably the greater Scotsmen are to be found round Dumfries, where they have had a greater supply of Welsh blood. Very little benefit has seeped through to the farmer. Very little of the increased cost has inured to his benefit. It is vitally important to emphasise this point. Because the farmer is standing on slightly less precarious ground than the edge of the precipice, it is no use assuming that he is on solid ground. Every hon. Member who represents an agricultural constituency understands the plight of the farmer and of the agricultural community as a whole. The farmer is suffering from the rise in the cost of living, as everybody else is; he is not immune because he is a primary producer. The only products which have substantially risen in price are barley, wheat and oats, and these represent a large proportion of the feeding stuffs of the farmer and this has resulted in an increase of something like 25 per cent. in the price of his feeding stuffs. On top of that he is also subject to the rise in the general cost of living.

The hon. Member for Frome told us about bacon and pigs and gave us some very interesting and striking figures. The Minister told us that the whole policy of the Government was directed to securing a proper price for the producer. I do not think that that is borne out by the facts given by the hon. Lady. If I might add one instance. If you take the average price of fat cattle per live cwt. you will find that it was lower last year by 1s. 1d. to 1s. 8d. than in the year the subsidy was adopted. If you take the price of Argentine chilled meat, which has had a subsidy for some time, the price is the same at it was in the subsidy year. So that actually the price of British beef last year had gone down slightly, although it had had this subsidy and the price of Argentine meat was about the same. Now £10,000,000 has gone towards the cattle industry in this country. Where has it gone? It is clear from the figures that there is a leakage somewhere. The only justification, in my belief, for the subsidy was that it would help a vital national industry to tide over a difficult time. I do not believe that a proposal of this kind would ever have had the support of this House, had it not been that the House really believed that to be the case. It is obvious, however, that the subsidy is not going to those for whom Parliament intended it. The figures as they have been given in this House, show that it is necessary that an inquiry of some sort should be held by the Government.

I wish also to quote the case of milk. I suppose that on an average milk costs 10d. a gallon to produce. I think that is a fairly reasonable figure, and that is about the actual sum which the farmer is now receiving for his milk. The price which is quoted is 1s. 2d., but out of that has to be deducted the levy and the transport charges, and when you have made those deductions, you will find that the farmer is only just about paying for the cost and is making no profit of any sort or kind. The consumer, on the other hand, is paying anything from 2s. to 2S. 4d. for his milk. There is a difference of from 1s. 2d. to 1s. 6d. between what the producer gets, and what the consumer pays. No one is going to deny that the distributor gives very useful service to the community and the labourer is worthy of his hire—but no more. One has only to compare the services which these two sections of the community give. Here you have the farmer who, as the hon. Lady pointed out, takes all the risks and has very heavy overhead charges, feeding costs and so forth, and a greater sum than he receives is added to the price of his milk before it gets to the consumer. It seems to me that that calls for an investigation of some sort. The President of the Board of Trade said that a report had been received by the Government. I do not think it has yet been in the hands of Members. I hope very much that the Government will act upon that report.

There is only one other point which I would like to make. The hon. Member for Gower has spoken of the lower-paid wage-earners. I would like to say a word about the lowest-paid worker in industry, the farm worker, who is worse off than many an unemployed man to-day. If the agricultural labourer is to be paid a living wage, which I believe to be the desire of all sections in this country, and if the agricultural industry is to be restored and made prosperous again—and that I think has come to be recognised as a national necessity—then the receipts which the farmer is now getting will have to be increased. There is no doubt at all about that. It may well be, as the hon. Lady pointed out, that even if retail prices do rise, the farmer will still not get a remunerative price. It was said by the President of the Board of Trade that the Government had not sought to tackle this problem in a purely doctrinaire way, and that they had realised that there was no one remedy for agriculture. I think that is precisely where they have gone wrong. They think they can tackle this problem piecemeal. I do not believe that is possible. I do noh believe that you can separate agriculture into two or three industries, and I am perfectly certain that the Government treat this problem as though each separate section of it had no relation to the others. I believe it to be one great whole problem and the Government will have to tackle it in that spirit. I would ask the Government not to consider, not to review—that is a very compromising word—the whole of this situation during the Recess, but to formulate a policy which they can lay before Parliament when it reassembles, a national policy for agriculture.

7.21 p.m.

Mr. Higgs

I think that hon. Members on both sides of the House will agree with the Minister of Labour that it is time that the statistics on which the cost-of-living figure is based were revised. They are the most important statistics used in industry. It has already been said that 1,000,000 wage-earners in the heavy industries have their wages based upon those figures. I would say there are many more whose wages are similarly based. There are many people who do not come within any of the various trade unions, such as office employés, whose wages are adjusted according to the Ministry of Labour cost-of-living index figure. In the immediate future there will be many more adjustments than there have been in the past, owing to the variation which is taking place in prices. The present basis of calculation was started in 1904, and has not been varied to any considerable extent since. I believe it is advisable not to vary the basis of calculation too often because, if that is done it is very difficult to make comparisons, but it is now 33 years since that basis was formed and possibly the time has arrived when it should be altered.

It looks like being a year and a-half or two years before the new basis can come into force. Between 1904 and 1911 commodity prices were fairly stable. I am afraid we should not have to-day the same benefit in the matter of stability as we had during that period, in relation to the fixing of the index figure. The cost-of-living index figure includes various items, and in a pamphlet which I have here giving the method of compilation it is distinctly stated that fruit is not included. I hope the Minister will see his way to include that very important item of food in the figures which he is about to get out. I think the objection to including fruit was that the variations in price during the year made it very difficult to do so. Now it is proposed that the figure should be based upon four seasonal costs, relating to October, January, April and July respectively. No doubt the inclusion of fruit would still be difficult, but it is the difficult things that are well worth doing, and statistics of such importance as those which are to be produced, statistics which will undoubtedly be in use for a very considerable time should include all relevant factors.

I understand that the only vegetable which is included is potatoes, and the variations in the cost of living in June, I am informed, was principally due to the alteration in the price of potatoes. If one commodity of that description varies so much in price, then I think it very necessary that other commodities which are consumed very largely by the working classes should be included. There is nothing included for entertainment. Tobacco is included, but not drink, and I was very much surprised to find such things as bannister brushes included, though these can only be negligible factors in the cost of living. The 1904 survey calculated on a family income of 36s. 10d. I am not suggesting that that is high or that it is low. Whether it is enough for the average family to live on or not is not a point which I intend to discuss. To-day, that would be equal to 57s., and if the cost of living is based upon an income of 57s. I consider the amount is too small. I should say that the income of the average wage earner is more like 70s. a week to-day. [HON. MEMBERS: "Where?"] The engineering industry pays from £3 10s. to £4 a week, and the building industry in Birmingham pays the same figure.

Mr. Sanders

To unskilled labourers?

Mr. Higgs

I am not taking the incomes of the lowest-paid workers. Fluctuation occurs in all rates of income, irrespective of their value, but I think it desirable to take the income of the average individual—neither the highest paid nor the lowest paid—when we are getting out cost-of-living figures. I am not arguing whether 30s., or 70s., or 100s. is the right income. But I do say that we should base the cost of living on the average income of the average family, the figure which is most likely to cover the incomes and requirements of the majority. Since 1904 methods of living have altered considerably. That is one of the great reasons why the cost-of-living figure should be revised at the earliest possible moment. In this pamphlet to which I have already referred I noticed that the word "weight" is used in this sense that the individual receiving 36s. 10d. a week has 12½ weights added for various items and for food 7½ weights. That is the ratio—12½ to 7½. I think that is a bad method of expressing a ratio. If the income of the average individual could be given as 100 and food given as a percentage, rent as a percentage, and so forth, it would be much easier to read than the method set out in this pamphlet.

The present unemployment statistics suffer from the alterations that have taken place over the last 10 or 15 years as a result of which comparisons are not very clear. I hope that when the new figures have been got out, the old cost of living will be given parallel with the new figure for a considerable period in order to enable us to make a fair comparison. British trade unionism has undoubtedly developed bargaining to a very high pitch and with great success. France and the United States could learn much from British trade unions in that respect. This British trade union development of bargaining power has been undoubtedly to a great extent based upon the cost of living. The aggregate working days lost in 1936 were fewer than those lost in 1935, and I am sure that that is a credit to everybody in these times of rising prices. I would tell the hon. Member for Gower (Mr. Grenfell) that the "Economist" figures for wages are now the same as they were in 1929 and that the Ministry of Labour figure for the cost of living has decreased 3.7 per cent. Therefore, the position of the worker is better to-day than it was in 1929, which, I think, is a fair year for comparison.

One trade about which I know something is the engineering trade. The engineers' rates in the last 18 months have increased 14½ per cent., and I am very pleased indeed to see it stated to-day that in future the engineering industry is going to pay for holidays. That is not the end of wage increases, for, of course, when trade improves, certain increases in wages take place. Then again people are working shorter hours, and shorter hours are very often not measured when the rate of wage increases is measured. Piece-work earnings also increase, and I am pleased to see that wages are increasing, but hon. Members opposite must remember that they cannot increase at a greater rate than industry can afford to pay. It has been suggested that the cost of living figures should be divided into a number of districts, and I think the number of 60 was mentioned, but I think it would be a very great pity indeed if we ever departed from the present method of one figure for the whole country. It is clear and concise. It may not be as accurate as we should like it for various districts, but I am afraid it is impossible to get absolute accuracy in a problem of this description.

Obviously we are going to have increases in the price of food with the increased prosperity, and we have got to expect it and to pay for it. It was objected to by the hon. Member for Frome (Mrs. Tate), but you cannot have increased prosperity without everyone taking part in it, including the food producers. They have got to take part in it. In conclusion, I hope that the day is far distant when the Minister will ever take part in or interfere with distribution. The less Parliament interferes with industry, the better. In 1932 the tariffs were applied, and in that same year it was necessary to help the agriculturist, but the agriculturist cannot have it all ways. The industrial districts have also to be considered, and, of course, we want to keep the food prices as reasonable as possible, as compared with the increased cost of living.

7.34 p.m.

Mr. Sexton

It is exactly a year ago to-day that I spoke in this House on behalf of a small section of the workers who were suffering from silicosis. To-day I am speaking on behalf of a section of the workers, much larger in numbers, who are suffering from an equally malignant disease. It goes by the name of poverty. There have been many speakers in this Debate who have talked about the power of the trade union movement to increase wages when prices rise. My experience is that those efforts of the trade unions, magnificent as they are, have very often failed to catch up with the increased prices that are charged. They are like the back wheels of a motor car trying to catch the fore wheels, always running and always struggling, but never quite catching up.

I do not want to talk so much for the trade unions, because on these benches we have a number of hon. Members who are prepared to state their case. I want to speak about a class of the workers of this country who have fixed incomes, and the cost of living affects them far more than it does the industrial workers. Who are these recipients of fixed incomes? First of all, I should take the old age pensioners, secondly, the widows and orphans, and last, but not least, that vast army of men in this country, the ex-service men, with their dependants also relying upon them for sustenance. What are the fixed incomes of these people? In the case of the old age pensioners and widows, the figure is 10s. a week, and in the case of the ex-service men, with the maximum of disability it is 40s. a week and there are varying pensions for varying degrees of disability. None of these fixed incomes, I submit, are sufficient to keep the people with any degree of comfort at all, and if they are fixed incomes there is no doubt at the present time, with this definite and disturbing rise in the cost of living—figures have been quoted by speaker after speaker in this Debate demonstrating that fact—that to the fixed-income people any rise in the cost of living lowers the real value of their income.

Last year, when I was speaking on silicosis, I said that perhaps the House of Commons, just before the holiday, would not like to hear much of a school-master's lecture. When I was a school-master we were told by the Board's inspectors that we should make mathematics as practical as possible. Well, I find in the homes of the old age pensioners that the practical values are far too evident and that the best teachers of practical mathematics are the old age pensioners, the widows, and the ex-service men. At the week-end I was interested in receiving a lesson in mathematics from an old age pensioner. He produced a 10s. note that he had received on the Friday for his old age pension, and when he showed me the back of it, it looked like one of those maps of Palestine that we have lately been seeing in the papers, because the Government have had before them the problem of the partition of Palestine. On the back of that 10s. note were lines and crosslines, and when I asked what they meant, the old man said that he had divided it out according to what he spent. He had a big black line down the middle, and he said, "That half goes for rent, 3s.; coal, 1s. 6d.; and light, 6d." That was 5s. gone. Then he had a smaller rectangle which was for food and bedding, and the size of the rectangle was a reflection, he said, of the size of the meals that he got, and with the increase in the cost of living it meant that he would get a smaller meal for the same expenditure.

Then he had for tobacco a very tiny space indeed. There are some people who say that old age pensioners with 10s. a week should not buy tobacco. I would remind such people that "man shall not live by bread alone," and that if you cut out the little bit of enjoyment represented by 4d. a week on tobacco from that old man, you are denying him something which you ought not to deny him. Then he had a very small square, about a quarter of a square inch altogether, marked on the back of the note, and I was interested to ask what it stood for. He said that it was for clothes and that it represented 3d. a week. He told me how he spent it. When charity organisations are having jumble sales, he goes to them and spends his money there on clothes. He showed me two pairs of boots that he had bought. One was a big pair, far too big for him, and the other was a pair for a child, so I asked him what he was going to do with those, and he said he was going to wear the big pair and that the little pair would come in for patching. He had another small square of the same size, and I asked what that was for. With tears in his eyes, he said that that was what he was putting aside, so that when the time came he could be laid aside decently and not receive a pauper's funeral; and even then the cost of living would affect that small amount, because if he had to pay more money for his food, he would have to put aside less than 3d. to put him away.

This old man knew very little of pure mathematics, but he was an exponent of practical mathematics. He was a master at it. When I told him of the study of arithmetic and so on in the schools, and that he had given me a very practical demonstration of arithmetic, he said, "Yes, I learned some arithmetic at school, but I understand that you have something better nowadays that is called algebra." He said he understood that many problems could be solved by algebra and that algebra could work wonders, and he said, "Would I not try it on the National Government, to see whether they could work the wonder of increasing the pensions of the old people?" As I listened, I, who have studied to some extent the science of mathematics, listened to the mathematics of misery. He told me that he had heard of miracles, of water being changed into wine, and he said that his case was the reverse, that his wine, if you could call it wine, had been converted back to water. He had read in his early days of alchemy, of changing base metals into gold, and he said that the increased cost of living was to him reversing that process, not chang- ing his gold back to base metals, because gold he knew nothing of, but changing his copper to lead, because his purchasing power was being decreased. At the same time, he was filled with bewilderment because he too had heard and read of the wonderful wave of prosperity which was passing him by, and he asked me what I could do, not only on his behalf, but on behalf of widows and ex-service men also.

I say to the Government, Is it within the power of the Government to control the rise in food prices? If they say "No," I ask them, Is it within the power of the Government to go into the whole matter of pensions and see whether they cannot bring forward an amending Bill at some time whereby they can be increased? I feel sure that the Government have that power, and it is their duty to do what lies in their power to restore to those people the proud independence of a heroic section of the community, the heroes of the industrial and the military field, and, may I say, the heroines who are eating their hearts out at home. There are thousands of Grace Darlings and of Florence Nightingales in the homes of the unemployed, the widows of this country, and the wives of the old age pensioners, and something should be done for them to prevent the humiliation of their having to go to public assistance committees to eke out the miserable pensions that they receive. It has been said in this Debate that the workers have a higher standard of living now than ever before, and I say, Why not? Has the introduction of machinery, with all the skill and intelligence and inventive genius of man, to go for nothing at all? We enjoy a higher standard of living, but I am afraid that, with the food prices rising, the people for whom I have pleaded, the old age pensioners, widows, and ex-service men, will receive no higher standard, but, instead, a lower one.

7.44 p.m.

Mr. Cartland

My right hon. Friend the President of the Board of Trade said that he was somewhat surprised by the very wide field which this Debate had covered; lately it seems that most of the speeches have dealt with the problem of agriculture. I should like, as one who represents primarily an urban constituency, to bring the Debate back to the principal subject which was before us, namely, the question of the cost of living. I think that everyone will agree that we are somewhat handicapped by the very sparse information at our disposal, and also by the fact that there is a Committee sitting which is looking into this particular question, and that until it reports and we know on what lines it is proceeding to examine the question, we cannot really deal with the whole question as many of us would like to do.

I am not surprised, and I do not think any other hon. Member will be, that such a wide field has been covered, because the cost of living does, in fact, touch every aspect of home life. That is why I venture to say that this is one of the most important Debates we have had for some time. Money wages are easily calculable and easily understood, but real wages are difficult to compute and easily misinterpreted. We have no ready-made standard for real wages, as we have the easily understood standard of £ s. d. relating to money wages. None the less, there are certain definite trends which can be followed out with regard to real wages. A great many figures have been given in the Debate with regard to the way in which wages dropped consistently and persistently from 1928–29 to 1934, and then levelled out and began to rise again. The cost of living followed almost precisely the same course, not only in this country, but all over the world.

The hon. Member for East Birkenhead (Mr. White) raised the really vital question, which is what is to happen in the future; if we follow up the trends of the past, how far are they likely to continue into the future? I think that the House will see some cause for optimism in the fact that while wages to-day are above the 1928–29 level, the cost of living is still below that level. When you consider the effect that rising consumption must have on the ironing out of the variations between boom and slump, it seems to me that with the indications of the continuing rise in wages we can look to the future with some sense of optimism.

I think it will be disastrous if this question of the rise in wages should become a question for party debate. The hon. Gentleman the Member for Gower (Mr. Grenfell), who opened the Debate in one of the most interesting speeches we have been permitted to listen to, made the point that the question of the cost of living is so important to every home that it would be a mistake if we were to juggle about with figures in order to score party points. I believe the hon. Gentleman the Member for Seaham (Mr. Shinwell) is to wind up for the other side to-night. He may remember that he made a speech some time ago in which he said that wages must be raised to much higher levels and the purchasing power of the workers substantially increased. Every one on this side of the House will agree with that statement. Then he went on to say that if this could be done without effecting drastic changes in our industrial organisation, so much the better. I entirely agree with the hon. Gentleman.

Mr. MacLaren

There is nothing in it.

Mr. Cartland

There is nothing in it except that he was expressing what, I think, is the generally accepted view, that this rise in wages must take place. In our view it can only take place if nothing drastic is done to upset the industrial organisation which provides the money for the wages.

I would ask the House to consider two general propositions with regard to the question of the cost of living. The first is this: there must be some fluctuations, some rising and falling in the cost of living and wages over any length of time. How far is it possible to iron out these fluctuations within the borders of our own land? A subsidiary question to that is, how far is the cost of living actually affected by indirect factors in the production and the marketing of goods and services?

I will give two examples. I will take, first, the question which was alluded to by the hon. Member for Frome (Mrs. Tate) when she gave us some variations in prices at different places at different shops in London and the country. If anybody reads the agricultural marketing reports from week to week and looks at the prices of the commodities and foodstuffs in the different centres of population, he must be astonished by the variations in prices of the same qualities of foodstuffs. It is unbelievable that the same quality of foodstuff should sell at such different prices in different centres within the boundary of one small island. The second point I would make is this.

The question was touched upon by the hon. Member for Hitchin (Sir A. Wilson) and was followed up by the hon. Member for Frome. How far is the cost of living being affected by the method of distribution which we have in this country?

Some hon. Members will have seen the report of a trial census of distribution which was made in six towns a few months ago. It was conducted by some industrial firms which are interested in the subject; they took six towns, each with a population of about 30,000. They were Jarrow, Chorley, Kiddermister, Stafford, Wycombe, and Weymouth, which is a varied collection. I do not want to give the House a lot of figures. When I listened to the hon. Member for Gower, I could not help feeling that we would do well in Debates of this kind to circulate our speeches like they do in some of the learned societies so that we could discuss them more adequately later. I will take three examples of shops in these different towns so that hon. Members will realise the enormous variations that can occur in the methods of distribution. Taking bakers first, it was found that in Chorley there were 54, in Jarrow 21, and in Wycombe 12. Of butchers, there were 50 in Chorley, 43 in Kidderminster and Wycombe, 34 in Jarrow, 33 in Weymouth and 35 in Stafford. Of greegrocers, there were 25 in Chorley, 48 in Weymouth and 15 in Wycombe.

What effect is this very variegated system of distribution having upon the cost of living? When one looks at the magnitude of the subject—and anybody who has listened to the Debate must have been impressed by it—and when one considers how essential it is that the cost of living should be kept at the minimum at any given time, irrespective of its rises and falls as it is affected by international affairs and by the rise and fall of wages in proportion, one is bound to ask has not the time come when we should have some kind of permanent committee which will survey this problem just as the Beveridge Committee surveys the problem of unemployment? The prices of foodstuffs in the home, and also of furniture and clothing, should be kept continually under review by some sort of impartial committee, exactly as the Beveridge Committee keeps under review the question of unemployment. The Beveridge Committee is able to give us some forecast of what will happen in the next few years. I believe that it would be possible for a permament committee of the kind that I suggest to give us an idea of what may happen in the future with regard to the cost of living.

Is the Committee which is now considering the cost of living index figure looking into the question of the number of shops and the variegated systems of distribution? Are they, in fact, taking the wide view of this problem which must be taken, or are they simply confining themselves to the small and rather narrow view? I was a little surprised when my right hon. Friend the Minister of Labour said that they were going to rely principally upon individuals in working-class households to fill up the forms on which the new basis is to be worked out. Anybody who has had anything to do with any form of social survey knows that the percentage of errors in the filling up of forms is enormous. I understand that the form is extremely complicated, that it is very long, and that details of household budgets and prices has been asked for. Unless the method of looking into this question goes far beyond the filling up of forms by individual householders, we shall not get anything like the cost of living index which we want and believe to be essential.

My second proposition is this. Surely the time has come when we should look beyond the bare minimum of the cost of living in all our discussions of the relations between wages and prices. We should look beyond the mere fact of what my hon. Friend the Member for Hitchin called the irreducable and elementary needs of man. Surely in 1937 we have to make some allowance for the necessary refreshment of the mind and for recreation; I would beg my right hon. and gallant Friend who is to wind up the Debate to convey to the Minister of Labour the desire, which I am convinced is in every industrial centre, particularly among the young people, that they should have the opportunity for a fuller life and all that it means. In any calculation in statistics dealing with the cost of living, we should make provision for that fuller life which is the demand of all people in this country.

7.58 p.m.

Mr. James Griffiths

May I join with the hon. Gentleman opposite in expressing the hope that in the inquiry which is being conducted into the cost of living, the points he has mentioned will be carefully considered? If people all over the country are to be asked to fill in very complicated forms, local people with local knowledge, and particularly with knowledge of how to get correct information out of people, are essential. If it is done in a cold-blooded official way, if an official merely calls at a house leaving a complicated form and returns in a week or so for the reply, I am sure that the inquiry will not have the result which is desired.

May I urge upon the Financial Secretary three important points that ought to be considered? The general experience is that in these days rent takes a far larger proportion out of wages than it did. We found that view everywhere. With some of my colleagues I have been making an investigation into the proportion of wages spent on rent. In many cases where workmen live in houses provided by their employers rent is the first charge upon wages, because it is deducted from the wages before the men receive them. There was an old rule-of-thumb maxim on this subject. I have heard my father speak of it. It was that if a workman was to live within his means, maintain his family and enjoy a minimum of comfort, he ought not to spend more than one-sixth of his wages on rent. The proportion of wages spent on rent nowadays is often. one-fourth, and at times one-third. In the new cost-of-living index it is essential that due consideration should be given to the proportion of wages which goes in rent.

There is another factor which is rapidly developing. In these days it indicates a desirable tendency, and we ought not to do anything to check it. In the area from which I come, where transport was pretty primitive, it was essential in the old days, that a workman should live quite close to the place where he was employed. The miners had to live almost on top of the pits. That, unfortunately, led to the mining valleys becoming built-up in the way they are. A pit was sunk and the houses were clustered round it. That state of affairs can be seen in South Wales and in Durham. I want to rebuild South Wales, but not that South Wales, just as the hon. Member for Spennymoor (Mr. Batey) wants to rebuild Durham. It is in many ways desirable that the pits and the communities of workmen should be separated and that is the new tendency, because new pits are now usually sunk in areas away from the villages. There is an example of that in the district in which I served as a miners' agent. Perhaps the biggest new pit sunk of late years, in the neighbourhood of Neath, has scarcely half a dozen houses within a mile of it and the miners employed there travel distances varying from 5 to 25 miles.

The alternatives are to build in the old way a large number of houses round a pit, so that the workmen live near at hand, or to house them at a distance and depend upon modern transport to take them to and fro. Many men travel miles to the pit by omnibus or train, and with the introduction of pit-head baths they can now travel home like human beings instead of beasts of labour. In nearly every case transport now enters into the cost of living. London is growing far too rapidly. A good many of us would stop its growth and direct economic activities away from it. I should like to see a census taken of the proportion of wages and incomes which people employed in London spend upon travelling. It must be a very substantial proportion.

Supplementing what the hon. Member for King's Norton (Mr. Cartland) said, I should like to speak on the needs of leisure. We ought not to bring the standard of living down to the irreducible minimum necessary for life. The need for leisure nowadays is much more pronounced than formerly. We are living in a mechanised age and mechanistic work, which is merely repetition work, while it does not call for the same physical exertion is much more deadening in its effects on the mind. I know that to be true in the mining industry. It produces nervous exhaustion and a deadening effect on the mind. Therefore, two reforms are necessary. I know that one does not come within the scope of this discussion, but that reform is a reduction of the hours of labour. We should reduce the time spent at this deadening work.

I have paid a visit to factories near London where they use tinplate made in my division. It is brought 250 miles from South Wales to be made here into the finished article. If we had any sensible industrial system, instead of dragging boys and girls and the tinplate from South Wales to London we should arrange for the finished articles to be made down there. In these factories I saw boys and girls at work. They sit down and operate a machine. That goes on for eight or nine hours a day. They work 44 hours a week. At the end of the week their minds are dulled and they feel the effects of nervous exhaustion. Under modern methods craftsmanship is being destroyed. If I lost this job there is only one other to which I could turn which I should know well, and that is coal mining. If I had to return to coal mining I would rather go back to the old coal-mining system of my boyhood days, when there was craftsmanship in it, when we were taught how to treat the coal, how to timber a roof, how to lay a road, when there was some scope not merely for physical work but for mental application, when there was an opportunity for us to put something of our-selves into our work. I would rather work 10 hours a day in a pit under those conditions than seven or eight hours a day in a modern mechanised pit where there is no opportunity for a man to display any skill and where this deadly work prevails. Therefore, as modern industry takes a greater toll of the nervous energy of our people the need for greater leisure ought to be taken more seriously into consideration.

In some trades the increase in the cost of living can be met by trade union efforts, but out of more than 12,000,000 workers in insured occupations only 4,000,000 are organised in trade unions. We are entitled to make the assumption that only about 4,000,000 are covered by any kind of collective agreement, and that the 8,000,000 outside depend upon the generosity of employers to get wage increases. Trade unions can be relied upon to do their utmost to get wage increases to meet the rising cost of living, and I would warn members of the Government of the temper which is to be observed among trade union organisations. At the conference of the Miners' Federation, at every conference, the workers are commenting on the increase in the cost of living, and the Government had better take note of the fact that the industrial temper is rising, and that there will be more and more demands for increased wages. What reply have the Government to make to that? Last week I spoke at a place in the South of England where dozens of young men from South Wales have found work. They told me that the work was completely unorganised, that there was no trade union, no collective agreement. They said, "We are just employed and are told what we are going to have, and there are no arrangements by which the wages can be revised." There are millions of unorganised industrial workers whose wages will remain as they are unless they take some action or unless employers voluntarily raise them. Some time ago I asked the Minister of Labour a question to which I got only a non-committal reply. I asked whether, in view of the increased cost of living, he had been in consultation with the Unemployment Assistance Board and whether they felt that it was necessary to revise their scales and regulations. I have here the regulations and according to them: there shall be determined by reference to the needs of applicants. the allowances which they are to be given. The Board are to fix scales of allowances by reference to the needs of applicants. The allowances and the needs must correspond. Do not the needs of unemployed people bear some reference to the cost of living? I think it was in July, 1936, that the Minister of Labour introduced the regulations in this House. He said: "I present on behalf of the Board these regulations and scales, carefully considered, carefully drawn up, by which they are to determine the needs of unemployed persons for assistance." I assume that the Government, as well as the Board, were satisfied that in July, 1936, those scales would meet the needs of unemployed persons. We on this side of the House did not take that view, but the supporters of the Government did. If they accepted those scales as being necessary for the needs of unemployed persons in 1936, when the cost-of-living index figure was 46, what should the scales be in July, 1937, when the figure is 55? I believe that the hon. Member for King's Norton, who made an interesting speech, went into the Lobby in support of those regulations. I put the question to him—if he thought those scales were adequate for unemployed persons when the cost-of-living index figure was 46, does he think they are adequate when the index figure is 55?

Mr. Cartland

I understood that advisory committees were set up to deal with those very points.

Mr. Griffiths

Advisory committees cannot change the scales at all. They can advise, and a man can get an exceptional allowance to meet exceptional needs. They cannot vary the scales. On the normal scale a man and wife should get 24s. per week. If that was taken by the Government to be adequate last July, when the cost of living was 46, why should it be adequate now when it is 55? The Government cannot get away from it. We do not accept these scales, but you do, and measures should be taken to increase them to the same relative adequacy as they were last July.

While we are absent from this Chamber for eight or 12 weeks, the cost of living is bound to rise. I shall not enter into a disquisition whether it is desirable or undesirable that prices should rise while wages, pensions and unemployment allowances lag far behind, but I would point out that whereas the man who is employed may take steps through his trade union to bring his wages up—the man who is unorganised ought to be inside his trade union—the unemployed person or the pensioner, or those who receive allowances of various kinds, cannot go on strike or withhold their labour. They cannot exert any influence except upon their representatives here. I think they have an unanswerable case. They were told last July that 26s. was enough for a man and wife; now that the cost of living has increased by 9 per cent., they are entitled to ask for a 9 per cent. increase in their allowances to keep them where they were last July. It is fair to ask the Government whether they have not an obligation and a duty in this matter. If the Government do not carry it out they will be betraying the unemployed. They should take steps to see that the allowances which they fixed as adequate in July, 1936, are increased proportionately in July, 1937, to keep them at the same level.

8.17 p.m.

Lieut.-Colonel H. Guest

I wish to claim the attention of the House for only a very short time. I have sat through the whole of the Debate and listened most attentively, particularly to the hon. Member for Gower (Mr. Grenfell), who opened it. When he spoke of the cost of living he included the four items of food, rent, clothing, and light and fuel. I wish to refer to food. Of all the primary necessities of our population, particularly the poorest people, food is the most important. This Debate has covered agricultural and town interests and almost every side of life, including distribution and transport. Every Department of the Government appears to be interested in some way in the cost of living. The President of the Board of Trade said that in order to handle the question of the cost of living he would have to know the details of almost every Department. The Departments of Agriculture, Trade, Health, Labour and Pensions have all been touched upon in this Debate. The one question that seems to have been omitted, so far as the cost of living is concerned, is whether any Minister or person should be placed in charge of food prices. Somebody should be definitely responsible to Parliament for supervising them. By my recent interest in by-elections, I know that food prices are a governing factor in the lives of the poorest members of the community, be they supporters on one side of politics or the other. It is a matter which comes before us every time we go to our constituencies.

Nobody is primarily responsible in this House for taking care of the food of the people, yet a Minister would find very much to do in that direction which would be of value to people in both town and country districts. The President of the Board of Trade admitted that the price of food is rising. The hon. Member who spoke second presented a very strong case, in which he spoke of the probability that the cost-of-living figures would go up in the very near future. I want to know who in this House will take a primary interest in seeing that prices of food shall not unduly hit the poorest of our population. I regret that the President's answer did not tell us how he proposed to handle the question of the rising costs of food. I know that his Department are engaged upon vast matters connected with industry and are not primarily responsible for dealing with food, and that the Ministry of Agriculture is engaged in food production, but many ques- tions arise in which food distribution requires examination and supervision. The relative interests of the agricultural producer and the town consumer seem to require attention and some definite person to survey the situation.

The President of the Board of Trade told us that this was much more a question of world prices, world tendencies and markets which govern the price of food than a question of the tariffs in this country, but I begin to wonder who is going to make provision and arrangements ahead, so that, when prices go up, some definite person or Department, Minister or Secretary, will be in charge to see that ample supplies are obtainable for this country. I notice there is some question of the control or supervision of prices charged in different cities and parts of the country, and of what production should take place in our own country. The question of distribution has also been raised; that evidently requires some sort of supervision. If it is necessary to have some Minister responsible for the food of the people in a time of prosperity, it is infinitely more important to do so in any time of slump or depression which may arise in the future, or in time of war. Last night the Minister for the Co-ordination of Defence referred to preparations required to meet an emergency. He has a vast number of duties which take up practically the whole of his time, concentrating upon preparations of materiel and such things as that. Undoubtedly, to my mind, some Department, or even possibly some Minister, is required who should be responsible for supervising and controlling the supply and distribution of food to our people in this country.

8.25 p.m.

Mr. J. J. Davidson

I fully agree with the hon. and gallant Member for Drake (Lieut.-Colonel H. Guest), and trust that the Government will give consideration to the point he has raised with regard to the appointment of sonic one member of the Government who will at least bring to the House a clear-cut policy with regard to prices and the cost of living. I want to deal particularly with the effect of the Government's policy on Scotland, and I regret very much that the departure of the Financial Secretary to the Treasury has taken away from the Government Front Bench the only Scotsman to whom I could appeal in this respect. I listened very attentively to the speech of the President of the Board of Trade. Ever since I entered this House, when the President of the Board of Trade was Minister of Education, I have felt, from his very attitude, that we might always expect from him a contribution to the Debate of a very high order. I regret to say that, after listening very attentively to his speech to-day, I personally feel that he has fallen very deeply from grace.

I regret very much that the President of the Board of Trade had to use that now well known and typical sneer of Government Front Benchers, usually a week-end sneer now, with regard to the attitude of this party on the question of armaments. I should have thought that the speech of the late Prime Minister, who is now Earl Baldwin, in which he pointed out to the House how the people of this country had been deceived by the Government, how on the question of armaments he had hidden the real intentions of the Government from the people, would have quietened criticism on that question from the other side for a considerable time. I was also very much impressed with the complacency of the President of the Board of Trade. He complacently told the House that the agricultural marketing schemes were resulting in extended markets, and that this would benefit the largest section of the community. I think hon. Members in all quarters of the House will agree that during the past two years there have been more questions and more squabbles with the farming community in this country, and more deputations, than ever before. The poultry farmers of this country have been up in arms; questions have been asked from all quarters of the House; the Government have been criticised right and left, from behind and in front, on their agricultural policy, and the chief criticism has been that these marketing schemes, by their fixation of prices, do not extend markets, but restrict the home market in this country.

It has been pointed out time after time by the Government's own supporters that this fixation of prices in the case of milk and other agricultural products has resulted in a great number of people being unable to buy, and in the destruction of food in this country in the midst of a great poverty problem. I myself, on 9th March, addressed one or two questions to Ministers on the question of food production, and I have here a reply which was given to a question by the hon. Member for East Fife (Mr. H. Stewart), asking whether the Government were bringing forward some measure in regard to the best way of organising food production in relation to defence. We have asked the Minister for the Co-ordination of Defence, we have asked the Secretary of State for Scotland, and this is the official Government reply: The question of appropriate measures to secure the food supply of this country is under close examination, but I am not in a position to make any further statement at the present time. This is the Government's policy on the question of food production, either in peace time or in war time, and the President of the Board of Trade complacently states that world prices are controlling the Government. Surely, in making that statement, he is condemning the present fiscal and tariff policy of his own colleagues and his own Government. We have appealed repeatedly without success to various Ministers of the Government to get on foot a great plan in this country. In Scotland we have 3,500,000 acres of land being used for private and selfish sporting purposes; we have hundreds of thousands of acres of land to-day used by wealthy foreigners for sporting purposes when it could be producing good agricultural produce.

The hon. and gallant Member for Drake touched upon a very important point with regard to the Government's policy on the question of food. I would like to see Members of the House of Commons able to ask, not half-a-dozen different Ministers on the Front Bench, but one responsible Minister, definite questions with regard to the policy of the Government on the question of food production in this country, and able to expect a definite policy from the Government Front Bench on that question. I would like to reinforce the point that was made by my hon. Friend on the question of increased wages, and I desire to make it perfectly clear that I am now appealing to the Government to depart from their complacent point of view as to prosperity. Only yesterday the right Gentleman the Member for Epping (Mr. Churchill) referred to the Coué-ism of the Government. He said that the Minister for the Co-ordination of Defence kept on repeating that our Services are all right to such an extent that he begins to believe it. The Government, who keep on repeating to themselves that we are now in an era of prosperity ,are beginning to believe it, and their supporters are beginning to believe it also. I want to give some particulars with regard to the great untouched section of the community of this country, the great number of people who are not participating in any new prosperity, but who, since this Government came into office, and particularly since 1935, have been living Under very much worse conditions than they were before.

Let us examine the question of wages. It is true that wages have been increased in certain industries because of the Government's new armament policy. They have increased in the heavy industries, but let us remember that at Beardmore's in Glasgow, where they used to employ 30,000 or 40,000 men, this great firm, working on the Government programme, is employing only 3,000 men. Right throughout the shipyards in Glasgow, Govan and the surrounding area you have only a fraction of the men employed who were employed some years ago, because of the policy of rationalisation and the efficiency of modern machinery. This small section which is sharing in the armaments programme is receiving those increased wages and, for that reason, some justification has been attempted that we should have an increased cost of living. In Scotland there is a vast percentage of the people who are not receiving wages at all, but who are on fixed public relief benefit, fixed unemployment benefit, fixed children's allowances and fixed old age pensions, every one of those allowances fixed by the Government before this increased cost of living took place. They are the people whom I am asking the Government to consider.

If any figures that I can give will assist in removing the complacency of the Government, I consider that I shall have served some useful purpose in submitting them. In answer to a question I was informed that in 1935 there were 1,116 people buried in paupers' graves in Glasgow, the second city of the Empire, and in 1936 the number was 1,228. This, surely, is no sign of prosperity for at least the most destitute section of the community. Let me turn to old age pensioners. Again in Glasgow, the recognised industrial capital of Scotland, in an area where one would expect that the Government's policy of prosperity would be noticed to some appreciable degree, in 1933 old age pensioners who, apart from their pension, had to seek public assistance, numbered 10,118. In 1936, while Members of the party opposite were telling the people that we were now in a boom period of industry, we had an increase of more than 3,000 old age pensioners going cap in hand for public assistance and receiving extra support because the pension was not sufficient to give them the ordinary decencies of life.

In April of this year we had 75,000 unemployed in Glasgow. We have had a figure fluctuating between 82,000 and 75,000, and the Minister of Labour takes some credit with regard to the decrease in unemployment. But, surely, even the Under-Secretary will admit, in fair debate, that if the unemployed figures have been reduced by a certain number in a particular city and the Poor Law relief figures have considerably increased in the same period, that is not a sign of prosperity but of worsened conditions The average number of men and women of 18 years and over registered at the Employment Exchanges as unemployed in Scotland in 1933 was 294,085 men and 51,455 women, and in 1935 245,330 men and 44,196 women. I give the Government credit that on those figures there is a decrease on the unemployed register. For 1932–33, for the whole of Scotland, Poor Law relief was £4,676,000, but in 1934–35, during this decrease of the registered unemployed, we had an increase of more than £2,000,000 for poor relief. I am submitting these figures to show that this continued repeating of a decline of registered unemployed, knowing all the time that they have been placed on Poor Law relief, is not only dishonest but is a practice which is not worthy of the House of Commons nor of British politics. Since 1931 Poor Law relief in Glasgow has increased, according to official figures given by the late Sir Godfrey Collins, by more than £2,000,000. In Scotland, as in England, old age pensioners throughout the country are appealing for increased local relief.

I listened very attentively to an appeal to-night for the broadening of education and for the giving of some more leisure to the children of the country. In Glas- gow an increased number of children are medically defined as suffering from malnutrition. In an era of prosperity, in one city, 8,000 kiddies of the working class are suffering from malnutrition, medically defined, and are receiving free meals in the schools at which they attend. In the constituency of the Secretary of State for Scotland himself, in the Kelvingrove Division of Glasgow, there has been an increase in the number of children suffering from malnutrition and receiving free meals.

What of the education of these children? Members of the Government must recognise that there are many criticisms made of local authorities with regard to their lack of ability and initiative in building houses and in carrying out local schemes of improvement. But how can these local authorities, burdened with millions of pounds of Poor Law relief, and with a rating problem that ought to be a national and not a local responsibility, build the necessary modern schools that we require? How can they provide classrooms for 25 working-class children instead of 50 and 60 pupils as we have in the City of Glasgow? There are 711 school classes in Glasgow with more than 50 or 55 pupils. The educational institutes and the professors of this country agree that no child can be adequately and efficiently educated to be a good citizen of the future, and to have a knowledge of citizenship, under the cramped classroom conditions which exist in poverty-stricken towns.

I appeal to the Government, in view of these irrefutable facts and of the answers that have been given to Members on this side of the House, at least to depart from their attitude of complacency and recognise that the women of the working class, scraping along on 24s. a week in my constituency and in other constituencies—these women, of whom, since the present Government came into being, an increased number have come under Poor Law relief, are as much entitled to leisure and the good things of life as the women folk of hon. Members on the opposite side of the House. The children of the working class in these poverty-stricken conditions should be given every educational facility which would take them from the elementary schools right to the universities of the country. The children of the working class are born with the same honour and love as the children of Members on the opposite side of the House, and they ought to receive the same educational facilities and chances in life. As far as the prosperity of the people of Glasgow, and indeed of Scotland, is concerned, the Government have brought forward no adequate measures, and I ask them at least to depart from their policy of complacency and to recognise that the wages question and the increased cost of living affect a huge mass of the community living in undeniably worsened conditions today. They should recognise that fact and get down to the problem of bringing some hope of betterment into the lives of that vast section of the community.

8.49 p.m.

Mr. Lyons

The hon. Gentleman the Member for Maryhill (Mr. Davidson) will take it, I hope, as no discourtesy on my part if I do not follow him into many of the localised details to which he referred. Whether I see eye to eye with him or not, I think that it is only right, particularly at this stage of the Session, that he should bring before the House any matters affecting his constituency that he things fitting for discussion in this Assembly.

Mr. Davidson

May I point out to the hon. and learned Gentleman, that I was dealing pretty fully with questions not only affecting my constituency, which I mentioned only once, but the whole of Scotland, which is a very important country indeed?

Mr. Lyons

I am not questioning the importance of Scotland, but the hon. Gentleman dealt largely with matters arising out of his constituency, which he will not expect me to accept or deny. I only say that no one on this side of the House will complain of the hon. Member bringing forward matters which he thinks ought to be ventilated.

Mr. Gallacher

It is very kind of you.

Mr. Lyons

It ill becomes the hon. Member or any hon. Member on that side of the House to make any reference to the discussions we have been having recently upon the necessity for re-arming in this country or to the statements made by the former Prime Minister, Lord Baldwin. When we think of the somersaults and the acrobatics, and of the running away of hon. Members opposite—

Mr. George Griffiths

You somersault every day.

Mr. Lyons

—and of the grave international position which they tried to exploit, it ill becomes hon. Members opposite to criticise. Before I deal with the matter particularly before the House tonight, I wish to make one or two observations upon the general position throughout the country. We can, at any rate, congratulate ourselves upon that, after some six years of administration by the National Government, who saved the country from catastrophe in 1931. [Laughter.] Hon. Members opposite can laugh as much as they like, but the facts that I am going to disclose to-night could never have been disclosed in 1931, when they had to run away from the position which they themselves had created. [An HON. MEMBER: "We were sold."] The standard of life is higher, and there are more people in work, and there is a vastly reduced figure of unemployment. The people of this country are better housed, better fed and better clad; their children are given better education and better opportunities in life throughout the country, the aged and the infirm are better safeguarded than has been the case at any time in any other nation in the world. We can take some satisfaction that those who, whether they be old age pensioners, or dependent upon unemployment benefit, or are working in industry, are dependent upon the financial fabric of this country, are safer and better off than has previously been the case either in this or any other country in the world. These are the facts of the present position.

Mr. Batey

rose—

Mr. Lyons

I will not give way again. Hon. Members opposite have gone about the country saying and hoping that the present prosperity of the country will not be maintained. However much they dislike the facts of the present situation, they have to face them and recognise that this condition of affairs has arisen through the confidence created by the National Government since 1931. [Interruption.] It is very easy for hon. Members who are divided upon most things to try to make interruptions when one is stating facts. I can only imagine that the facts that we know exist in the economic life of England to-day are not very happy for them because they have done their best to create all kinds of class warfare, to wreck confidence, and to do what they can to destroy the prosperity which has come to the country. They have to face the position that in the last six years unemployment has gone down from something like 3,000,000 to less than 1,500,000.

Mr. Messer

So it has in Germany.

Mr. Woods

It has disappeared altogether in Russia.

Mr. Lyons

It is no secret that it was expected that unemployment would go beyond the 3,000,000 figure in 1931.

Mr. Messer

It went beyond the 3,000,000 figure during the time of the present Government.

Mr. Lyons

Since 1931, when the National Government have done salvage and reconstruction work, the figure of unemployment has gone far below the 3,000,000 mark. We have had an upswing of wages; a record upswing in the last three years, and the purchasing power of wages and benefit has been kept safe. [Interruption.] Interruptions are very easy, but even if they get into the local papers in which hon. Members opposite are interested, they will not interfere with the facts that I am narrating. Let me read from the recently issued report of the Chief Inspector of Factories: It is particularly satisfactory to hear that this activity is not confined to such busy centres as the London area, Birmingham, Leicester and Luton, but that there has been a revival in trade which were in a state of depression only a short time ago. Existing steel works have been fully occupied, and additions have been made to buildings and plant, but in spite of this, production has not always been sufficient to meet without some delay the demands of other busy trades. Great activity in shipbuilding is reported from the North-East coast, from Scotland and from the North-West of England. The contrast between the present active state of the Clyde and the silence of three years ago is very striking. That is a matter on which we may well reflect. When the National Government was formed after the 1931 election, there were hon. Members opposite who said that the difficulties and the crisis in which the country was then placed could be traced to the low price of commodities, and they said that if only there could be an increase in the cost of foodstuffs and primary commodities, they would never have been in the crisis which then existed. They cannot have it both ways. It was inevitable that some increase should come. It was inevitable that something should be done to enable those engaged in agriculture to make their industry more of an economic success. Leaders of the Opposition have said time and again that they wanted to see an increase in prices. There has been some increase in prices, and I hope that those who are engaged in industry will realise that by seeking to make agriculture a success we are helping agriculturists to have money in their pockets so that they can in turn buy the goods of the industrialists.

Whereas the cost of living has risen slightly, better conditions have arisen in far greater proportion than any increase in the cost of living which has been brought upon those who are dependent upon financial assistance from the State. I remember the time when hon. Members opposite voted for far less maintenance for those who are dependent upon State assistance than those people are getting to-day. They failed in their agitation. When we look round we see that the standard of life is far greater to-day than has ever been known at any time in this country. It certainly is infinitely better than the precarious conditions that existed during 1929–1931. Only to-day we heard that the proposal for holidays with pay has been brought a stage nearer realisation. An agreement has just been reached between sections of industry affecting 500,000 people, and by a voluntary arrangement the system of annual holidays with pay is to be instituted.

I supported a private Member's Bill which was introduced by an hon. Member opposite in favour of holidays with pay because I felt very strongly on the matter. My hon. Friend the Member for the Hallam Division of Sheffield (Mr. L. Smith) moved an Amendment in Committee and the Bill was not proceeded with; but to show the good temper and good will which exist, I should like to point out that my hon. Friend has been largely responsible for bringing about that measure of agreement of which hon. Members opposite are jealous, because they know that they could not bring it about when they were in office. I welcome this agreement, first, because of its value to the 500,000 people affected and, secondly, because it signifies the good temper and co-operation that exist between em- ployers and employed in trying to bring about by team work improvement in the lives of the workers, which the Socialists talk about but dared not introduce.

We have seen an upswing in wages far greater than has ever been known in recent years, and we have seen a state of prosperity brought to this country the like of which has not been known for a long time. I should like to speak specially of the City of Leicester, and I am just as much entitled to speak for my constituency as the hon. Member opposite spoke for his.

Mr. Davidson

On a point of Order. Is it the custom of this House, and is it in accordance with the dignity of this House, that an hon. Member should be constantly pointing in a rude manner at another hon. Member?

Mr. Deputy-Speaker (Sir Dennis Herbert)

I do not think the majority of hon. Members are so thin skinned as to be hurt by the hon. and learned Member's gestures.

Mr. Lyons

As far as Leicester is concerned we have, largely due to the confidence created by this Government, a greater volume of people in safeguarded work than has ever been the case since records were kept. In one industry after another we have seen a fresh rise in employment. While there may be here and there, as has never been disputed, a rise in the cost of living, of materials and of foodstuff—all of which were desired very much by hon. Members opposite in 1929–1931—there has been such an increase in safeguarded employment as more than to counterbalance this added incidence. The volume of unemployment in the City of Leicester is far less than it has been since records were kept, but I realise that there is room for improvement.

The hon. Member opposite referred to complacency. This is no time to be complacent. We recognise no complacency in the programme of work of the National Government. One endeavour after another has been made to improve the condition of affairs. There has been continuous and increased progress, giving better figures of employment and every prospect that the volume of unemployment will be decreased. That has been the Government's programme since 1931. There are, however, many things that can be done in the framework of our existing legislation, whether it be by decreasing the amount of imported manufactured goods or by reducing the hours of employment; or the hours of the working week. A great deal more can be done to put more people into employment in Leicester. And this is on the line of steady, safe, progressive government.

There have been many discussions in connection with the shorter working week in industry. We have seen a definite inquiry into the whole situation, but I believe that the measure of improvement is far greater than any which has been reported at any time since the matter was first discussed in this House. I believe in a system of more leisure by a distribution of employment. I think, under this Government, it is more practicable and nearer, than ever before. It was said by an hon. Member opposite that the Government are responsible for reducing employment because they have encouraged efficient machinery and made rationalisation possible in industries which were inefficient. I dissent altogether from that view, and I hope the Government will continue every effort, through the Ministry of Labour, the Board of Trade, and the Import Duties Advisory Committee, to make industry still more rationalised and still more efficient. Industry should not be denied any help in machinery or otherwise which will cut out the drudgery of those engaged in it. The introduction of new machinery has no adverse effect on employment. New and better equipment means better employment. In fact, unemployment can still be reduced by bringing into industry every modern contrivance that is possible which will make more pleasant and harmonious the task of those who are working in it.

A word has been said about equality of opportunity in education and the need for reducing the size of school classes. We on this side of the House yield to none, as our achievements have shown and as definite results have shown, in our desire to give everybody in this country equality of opportunity. The figures show that the Conservative Governments and the National Government, have brought about the greatest measure of educational opportunity to the children of this country ever known.

I hope we shall see the time when large classes will be entirely abolished, but that must depend on the financial stability of the country. In our better position today we can expand. If we had gone further on the slippery slope of 1930–31 there would have been no hope for any improvement in our educational system. We can now improve where others wrecked. There is now confidence throughout the country in all sections of industry, due to the work and to the stability of the National Government, and I hope that next year when we are discussing this same question we shall be able to point to a still greater measure of improvement, and to a still greater degree of prosperity than we can to-day. At any rate, we are gratified with the improvement that has taken place, and while we cannot be satisfied or complacent while there are 1,500,000 or 1,250,000 persons unemployed, we can remember that the improvement has been responsible for a tremendous diminution in the number of unemployed, and also for the record number of those who are employed in safeguarded industries since records have been kept.

9.10 p.m.

Mr. Sanders

I do not propose to follow the hon. and learned Member for Leicester, East (Mr. Lyons) into the question as to who was responsible or what was responsible for the period between 1929 and 1931, during which not only this country but the whole world suffered from what the right hon. Gentleman the Member for Epping (Mr. Churchill) described as an economic blizzard. At any rate, I can say in reply to him that the more responsible Members of his party, the leaders of his party, have given hon. Members on this side of the House a clean Bill as to the causes of that economic blizzard. We did not cause it and we were not responsible for the tremendous slump which took place and which affected the whole of the world.

Mr. Lyons

rose—

Mr. Sanders

I propose to follow the example of the hon. and learned Member and I refuse to give way.

Mr. Macquisten

The hon. Member will not be barracked.

Mr. Sanders

I was replying to the hon. and learned Member for East Leicester. The hon. and learned Member for Argyll (Mr. Macquisten) will have his opportunity later, and will no doubt make good use of it in his usual genial and humorous manner, which very often is not on the point at all. The point I want to make is this: the question of prices which was troubling not only this country but the whole world between 1929 and 1931 was not the question of retail prices but of wholesale prices. What is troubling us now is a rise in the cost of living out of proportion to the rise in prices in the wholesale market. This marvellous prosperity of which the hon. and learned Member spoke arises mainly from the extraordinary amount the Government are spending on armaments and is not based on any real, solid, economic recovery. We must not forget that. If my word is questioned I would refer hon. Members to the recent memorandum from the Federation of British Industries, a body which probably knows more about industry and its future, immediate and distant, than the hon. and learned Member. It represents the greatest body of producers in this country and probably the most powerful in the world, and it deplores the fact that is seen looming up, when the expenditure on armaments is finished, one of the most tremendous slumps this country has even seen.

A large proportion of the men who have been taken out of the unemployment ranks are engaged on armament orders; and they are not permanent orders. A great deal of employment has been caused by house and factory building. Experts in the trade say that this will not last very much longer. What is to replace the tremendous demand for builders and engineers when the building boom is over and when the armament boom is over? There is no great reason to congratulate ourselves on this prosperity. It is largely artificial, and when the causes disappear the prosperity will disappear under the present capitalist system.

On the question we are supposed to be discussing, the rise in the cost of living, hon. Members on this side of the House are glad to know and to realise that the question, bound up as it is with that of wages, is being treated every year more and more from the human standpoint. Hon. Members on this side, without reservation, say that it is due to the teaching we have given on tens of thousands of platforms throughout the country for the last 50 years, namely, that labour is not to be treated as a mere commodity. At last that doctrine has driven on one side the doctrine that used to animate the employers and the upper classes, who were usually represented by the Conservative party.

One of my earliest recollections in connection with my early political career was going, as a boy of 17, to a meeting addressed by the local Member of Parliament, who represented the Division which I now have the honour to represent. He was supposed to be an advanced man, with a kind heart, and probably he was a good husband and father. The question was put to him, "Will you, in your place in the House of Commons, demand that the Government should raise the wages of the men now working in the Deptford victualling yard, who are being paid 19s. for a 54-hour week, to a minimum of 25s., and make that the minimum for London?" He said, "No, I certainly will not ask the Government to do that, because it is the business of the Government, as it is the business of every other employer, to get labour in the cheapest market, and if the Government pay a penny more than they need for the labour they employ, they are robbing the taxpayer." I have never forgotten that answer. But not a single employer on the other side, whatever he may say when talking with his fellow employers in his club and at private meetings, would dare, on a public platform to give such an answer to a similar question to-day. We claim that that is due to the new teachings that we have given on economic matters, that the first claim on any prosperity in the country, and the first claim on the national dividend, should be given to the people who are responsible for creating that prosperity and that national dividend. They are the great masses of the working people. Without them, there could not be a national dividend or national prosperity.

My hon. Friends have pointed out a fact which is becoming more and more obvious to those who are acquainted with local government. It is that more and more the cost of unemployment and of supplementing the allowances to old age pensioners and other people with low fixed incomes is falling on the local authorities. I would point out to my hon. Friends, especially to those who are in touch with the local government centres, that there is likely to be in the near future a very big increase in one of the most important items of the workmen's expenditure, namely, rent. The Central Valuation Committee, I presume under the orders of the Ministry of Health, has sent round a circular to all the assessment committees calling upon them to adopt new principles in assessing dwelling houses. A Conservative friend of mine, who is an expert in these matters, assures me that those new principles, if followed by the assessment committees, will mean that the assessments of small properties will be raised by anything from 50 to 80 per cent.

I warn all those thrifty small-salaried people who have been investing their money, through building societies, in houses, that this circular says that the cost of the house is to bear no relation to the rateable value and that the assessment committees are to find out what a decontrolled house of that kind would be rented, and to assess the house for rates on that rent and not on what was paid for the house. There will be a rude awakening for a good many thrifty people and working people with regard to the cost of living if the principles of that circular are adopted. As rent is a very important part of the expenditure of a low-paid worker, sometimes being one-fourth or even more of his wages, it will mean probably a very big increase in the cost of living, which cannot be evaded by the workman either as occupier-owner or as tenant, because it can be put on to his rates in one case and on to his rent in the other. The prosperity about which hon. Members opposite have boasted this afternoon will not receive such enthusiastic applause from the circles I have mentioned as was given in the House by those hon. Members who apparently believe that there is prosperity.

The whole question of the cost of living should be discussed as we have been discussing it this afternoon. I hope the result of it will be the realisation that, as well as looking after the producer, there should be some Member of the Ministry appointed to watch the interests of the consumers, and to try to think of some process whereby any slight increase in prosperity shall not bring about, as it has to-day, an abnormal rise in the prices of food and other necessities of the poorest of the community.

9.23 p.m.

Mr. Macquisten

I would like to assure the hon. Member for North Battersea (Mr. Sanders) that my interruption at the beginning of his speech was to the effect that he would not be barracked as the hon. Member who spoke before him had been barracked by hon. Members opposite. I listened with patience to the hon. Member for North Battersea and the hon. Member for Maryhill (Mr. Davidson), both of whom thought that the Government were very complacent. I would warn the Government to take careful note of that statement, as both hon. Members are great authorities on complacency. This has been an interesting and enlightening Debate. I very much regret that I did not hear the speech of the hon. Member for Gower (Mr. Grenfell), but I was prevented from being here. I heard the hon. Member for Hitchin (Sir A. Wilson), in whose speech there was a great deal of thought. The hon. Gentleman raised the question of rents, which has also been touched upon by other speakers. The proportion of the working man's wages that goes in rent is monstrous, especially in London. A lot of that is rates. I know of cases where men with 50s. a week have to pay between 15s. and 22S. That is a shocking state of affairs. The hon. Member for Hitchin also touched on the question of travelling. The suggestion made by the hon. Member for Llanelly (Mr. J. Griffiths) would lighten the labours of the housewife tremendously. If the vast majority of workers could get home for their mid-day meal and have it with their wives and children the woman would have only one hot meal to prepare instead of two. It ought to be possible.

The hon. Member for Hitchin spoke of the dispersal of industry. It is dreadful in London if you are travelling in the rush hours to see the crowds, with people standing like sardines without any oil to keep them wholesome. There is a good deal of irritation and noise. There is no system in it. They do not even stagger the hours of employment. Shops and offices all close together. Both sides in the House combined—I almost said conspired—to give London Transport a monopoly, with the result that they look upon the people as existing for the purpose of providing passengers for London Transport.

Mr. Gallacher

For providing profits.

Mr. Macquisten

No, not profits. The profits are not great. It is a great misfortune that the tubes and the Underground were ever constructed, because if they had not been London would have got so jammed that people would have moved out of it. The more tubes you build the more congestion you will get. You lay a tube out to Golders Green or somewhere and all the people with property make an awful lot out of it. The Government have never had the sense to do what the Canadian Pacific did. If the railways had been allowed to buy as much land as they liked and get the value of their own improvements for themselves, we could have had free transport in this country, but we were not enlightened enough to do it. And now we are strangling road transport, the one thing we can hope for in order to get the people dispersed. You will never get the cost of living down as long as you have a concentrated population. That is what leads to the huge rents. The hon. Member for Frome (Mrs. Tate) forgot that the people she was talking about were all shopkeepers in highly rented shops who paid enormous rates. The London shop-keeper is a member of the great brotherhood of Zaccheus—the tax gatherers. The greengrocer can administer only to the well-to-do. No working man can afford to buy vegetables except potatoes, and he cannot afford to keep them fresh. The same applies to fish. The present system of distribution not only makes the fish stale but very expensive.

A distribution of industry can be secured by liberating road transport from the stranglehold which the railway companies are putting on it. The present position leads to population congestion and the miserable conditions in tenements. I believe that Hitler wants to put down all tenements, because he says tenements breed Communists. We have genial Communists in this country. Till you get the population distributed you will never get a decreased cost of living. You must reach the position as it is in Switzerland, where the people who grow vegetables do not take them to a market which has to make profits and then to a shop which has to make profits, but bring them in on a hand cart. The Government that can bring the producer and the consumer face to face has solved the problem of civilisation. But we are not doing that; we are keeping them apart. All that we have done for agriculture is to load them with marketing boards, put a huge body of expensive officials round their necks. I do not know who led the Government up the garden. The present Government and the one before them went blindly on. They have had a great deal to do with the increased cost of living. Milk is up to 2s. and 2s. 4d. in Scotland. It used to be much less when there was free competition.

Then say, to frighten us, "Chaos would have come." Of course it would, and a certain number would have gone out of trade, but they would have gone out in the atmosphere of free competition, and the best men would have been left. The great combines would have been easily defeated by the small man with no overheads, but he has been legislated out of existence just as the man who ran his independent omnibus was legislated out of existence by the London Transport Board. They have done it with great newspaper advertisements. They call it publicity; it is really keeping down publicity; it is seeing that all the publicity will be favourable. They are trying to get hold of the poultry industry. They are saying to the poultry industry "Unless you accept our bureaucracy—I believe that Lord Addison was the man who was to be put at the top of it—and our officials who are going to sit and hatch the eggs for you—marketing board eggs—you will get no protection; we will not denounce these Treaties which are allowing in eggs at a price which will ruin the poultry industry." The only man who can succeed at present is the farmer who has a few hens which he does not feed, but allows to work for their living. In China they say that hens which work for their living make much better eggs.

Mr. Bellenger

A little while ago the hon. and learned Member seemed to be in favour of inefficient units going out of business under private enterprise. The poultry industry has no marketing board, so I take it that he is in favour of inefficient units going out of existence?

Mr. Macquisten

They are not inefficient, they are competing with foreign products from countries where the standard of living is infinitely lower. I want protection for them, the same kind of protection as that which was given by the former President of the Board of Trade, who now sits in another place, to his constituents in Cornwall who grow vegetables. They wanted protection pure and simple and nothing else—no quotas or other devices—and the then President of the Board of Trade applied a different doctrine in that case to that which has been applied in the case of the poultry industry. Everybody knows that the vegetable-growing industry in Cornwall would have been exterminated and wiped off the map if vegetables grown in North Africa had been able to get on to the market here. The imported vegetables would have arrived here in a tired and stale condition but notwithstanding that, the importation would have been enough to ruin the market gardening industry at home. So, the home producers in that case desired protection, and so does the poultry industry at the present time require protection—just straight honest-to-goodness protection, and nothing else. They do not want their market to be invaded any more than the coal industry would like it if coal were to come in here wholesale from Indo-China or somewhere like that, where the standard of living was much lower than it is in this country.

The farmer has the remedy in his own hands as far as his workpeople are concerned if he only had the sense to apply those remedies. Why do not farmers see that their workpeople have sufficient extras to induce them to stay on the land? I knew one very prosperous farmer in Scotland, a man who took life very easy and who was very good to his workers. He insisted that every man should keep a pig. He told me that other farmers in his neighbourhood would not allow their men to keep pigs because they said the pigs stole the food. In his own case he said the pigs did not need to steal any food because he fed the pigs. That farmer was so popular with his workers that a man would never leave him because, as I have heard it said, men have been known to desert their wives but one has never heard of a man deserting his pig. That man, simply because of his humanity in the treatment of his workers, made a great success of his farm. The workers were well-fed, they had vegetable gardens and they had lots of cheap milk which was as good as an additional 15s. or 20s. a week on their wages, although the cost to the farmer was nothing like that.

The mistake which the farmer makes is that he considers all wages in terms of money. The farm servant who gets his wages only in money has to buy all his goods in the shop and help to pay the shopkeeper's profits and rent and rates, and so forth, and also the costs of the middleman. Direct supply would solve many difficulties and it is a pity that we have not, in these matters, some of the wisdom of our ancestors. In Queen Elizabeth's time you would not be allowed to employ a man unless you gave him an acre of ground on which to grow his own food. It is a pity that something could not be done in the direction of reintroducing these old sensible ideas. Suppose, for instance, that every miner had his own plot of ground to cultivate. The ground could be co-operatively ploughed and the miners could keep pigs instead of keeping whippets, as so many of them now do. But they cannot keep pigs now, I suppose, because the sanitary authorities would refuse them permission.

Mr. J. Griffiths

Where would they get the horses to plough the ground?

Mr. Macquisten

They could hire a tractor. I know one shipbuilder all of whose men are smallholders, and I think something of that kind could be done on a much larger scale in other industries. There is another thing to which we ought to give consideration in connection with our food supply. There is a great deal of malnutrition. It is not so much under-nutrition as the result of people not knowing what are the nourishing foods to eat. They all want something tinned. I saw a reference the other day about a rise in wages having led to an increased consumption of tinned food. I can tell hon. Members that the people in the Highlands in the old days were not accustomed to luxury feeding, but any one who goes to Tiree or some of those places will see the walls which those men built and the gigantic stones which they moved in constructing those walls. Those men must have been giants in strength, but they were brought up on the simplest kinds of food.

I remember that in Argyll there was a father and 10 sons who were the most magnificent specimens of humanity one could imagine. The old man complained to his laird about the state of the road leading into his farm and said that his cart had sunk in it up to the axles. The laird, who was accustomed to the quarterdeck said, "It must have been damned bad" and the old man's reply was "Yes, Admiral, it was so bad that when I took out the horse I could hardly pull the cart out myself." Men like that were bred on oatmeal brose—not boiled oatmeal or scalded oatmeal, because if you boil oatmeal or even put boiling water on it, you kill the meal and it has no nourishment. These men had the real brose, and they had herrings and potatoes and good fresh milk such as you cannot buy in our towns to-day, and they were giants.

In my own village, I remember two very fine specimens of manhood who died only a few years ago. They were twins and their photographs used to appear in the "Daily Mail" as those of a wonderful pair. One of them died at the age of 96—just about a year after he had stopped working. He had had one or two slight illnesses during his lifetime, but the other who lived to the more advanced age of 97 had never been ill in his life. When the first brother died a neighbour speaking sympathetically of him said, "Poor fellow, he was aye the delicate one of the two." Men of that type were bred on a kind of food which is far cleaner and better than the sophisticated stuff which you get in towns to-day. I have just had a letter from the principal analyst of the town of Hull telling me that he has found fault with the Member for Hull for opposing my Bill about the sophistication of the herring. He tells me that he is constantly complaining of the way in which food is subjected to all kinds of treatment such as the bleaching of flour, and the answer always is that the customers want that kind of thing. The customers do not want anything of the kind. They want pure simple food, but they cannot get it. White bread made out of bleached flour has a very low nourishment value, but wholemeal is difficult to get, and in many cases it is just flour with a little bran mixed into it. There is very little honest food on the market to-day and what there is is a very high price. What we want is to get back to simple foods of the kind on which those grand old Highlanders were fed like the oatmeal brose I have described.

Mr. Sexton

How is it made?

Mr. Macquisten

I will tell the hon. Member how it is made. You get a cupful of pinhead oatmeal—good sized oatmeal—and put into it a lump of butter about as big as a walnut, with pepper and salt and some water—not boiling, though it may be hot—and stir it up and you will have the finest meal you could wish for, with a cup of good fresh milk. If you take that three times a day you will never be hungry, and you will be in splendid health. The hon. Member for Dumbarton Burghs (Mr. Kirkwood) once got into serious trouble when te suggested that people should eat more porridge, but porridge is a nasty English mess. The way I have described is the best and simplest way of taking meal. In that way you can reduce the cost of living almost to a minimum, but you must have milk, and I do not think the Milk Board will allow you to get the milk. They need it all for themselves and their customers.

These are the simple little things that might help towards more nourishing and better living. The vast proportion of the stuff that is sold in shops to-day and the food that the people are getting is contrary to health, and what you want is to get greater simplicity. What is the use of all the inventions of machinery and science if you are not to get any leisure to enjoy life and get out into the fresh air? A man who spends eight hours in the Law Courts is an exhausted man; four or five hours are as much as any human being can stand in such an atmosphere. Why should we not take advantage of these things? But if our leisure time is to be spent standing in tubes and strap-hanging, it will not do us much good. The first thing we must do is to get rid of so much travelling and to reduce the enormous transport on the roads. Above all, we must get industries to disperse and to let the people live around the places where they work. Let the employer of labour realise that the first thing he should do is to house his employés in good surroundings. I never could understand why employers do not realise that the best thing for them is to have contented employés, and the first thing to do in order to get them is to give them houses that their wives will be satisfied with. If you satisfy the wives, you will satisfy the workmen, and you will not have any trouble with them, but they never think of that. They come crowding into the towns with their industries and contest with the rest of the employers of labour, and then they expect to get peaceful, happy, and contented workmen. Think what it would have meant to the railways of this country if they had housed all their workers? They could have had them in country areas with suitable gardens. What an asset it would have been. Also, if our miners had had homes, with a bit of land attached, so that they could have had every possible comfort, and in black times, instead of leaning against a wall, they could have had a bit of land to work on and to grow food with which to fill their children's stomachs.

These are the lines that employers should go on and that the Government should encourage, and I regret to say that I see no signs of it, nothing except the constant appointment of more boards and more officials. The Milk Marketing Board take £5 a cow under the new levy. Is that going to help reduce the cost of living? Of course, it is not. It is not the Government's fault. They have inherited it from 1931. They have gone blindly on, with blinkers on. All that the party opposite want to do is to corral or organise the food supplies of the country, but in the meantime the cost of food and the cost of living are going up in a very regrettable manner. I admit that the wages are better, and I do not agree with the hon. Member who spoke immediately before me. I do not remember his constituency, but I think he might be called the Member for Jeremiah, because he did nothing but moan about the slump that was coming. The Secretary of State for Scotland the other day spoke about a man who, on the longest day in the year, was asked why he was looking so gloomy, and he replied, "Well, this is the longest day, and the nights will soon be drawing in, and I do so dread the winter." There is no reason why we should have these slumps, none whatever. They are largely psychological, and it is not so much a question of supply and demand as it is of the feeling of the people and of the world, and when we get prominent politicians going about prophesying evil, well, they bring it about. I say, "Be of a cheerful Countenance." Believe that the good thing is coming, and there is nothing more likely to bring it about. The present Gov- ernment, with all their faults, are, I think, the best Government we have had for very many years. I have Seen a politician for 50 years, and I say that the Government have given the people far better conditions than would ever be possible under a Government composed of my dear friends opposite.

9.52 p.m.

Mr. Shinwell

I am sorry that I am unable to follow the hon. and learned Member for Argyll (Mr. Macquisten) into his reminiscences or to adopt any of his suggestions. We are more concerned about the supply of essential foodstuffs to our people than we are about their preparation. That, we are ready to leave to the housewives of the working classes of this country. It is remarkable that every speaker in this Debate, with the sole exception of the right hon. Gentleman opposite, has agreed that there are defects in the capitalist system, and all that remains is for me to convince the right hon. Gentleman. If I can, then the battle is won. Meantime, let us consider the many suggestions that have been made to the Government in the course of the Debate in connection with our food supplies, and the kindred question of the cost of living and its effect on the poorer section of the community. There is agreement in the House that the cost of living has increased, particularly as regards foodstuffs, and that there is a tendency in a rising direction. It is also admitted that there exists, in spite of manifest improvement, a mass of poverty in the country, that there is a section of the community living in conditions of great hardship, and, furthermore, that what is called prosperity has failed to touch the lives of people who live on small fixed incomes. Over and above that, there is agreement in the House regarding the disparity between wholesale and retail prices, and that the methods of distribution remain unsatisfactory and transport costs are excessive.

There was almost general agreement—I will not put it higher than that—that the Government, judging, at any rate, from the speech of the right hon. Gentleman, have no policy for dealing with this matter. The right hon. Gentleman said that it was difficult for any single Minister to answer the points raised in this Debate. That is true, except that I would remind the right hon. Gentleman that he has occupied a large area of the Government Front Bench. He has been Minister of Labour, President of the Board of Education, and now he is President of the Board of Trade. He should, therefore, have a wide experience and be competent to deal with all the matters as they emerged in this Debate. If he demurs, may I suggest that the Government might have regarded this Debate as something in the nature of a Vote of Censure, and the Prime Minister might have been asked to present himself and reply to the matters that have been raised.

As an alternative, the Government might see that in future there is a Minister who will devote himself exclusively to the question of food supplies and their distribution. The right hon. Gentleman can have it any way he pleases. He twitted us with not raising the question of unemployment, and assumed that, because we have not availed ourselves of the opportunity of so doing, we were satisfied with the existing conditions. I assure him that that is not so. We might have reminded him that, in spite of all the talk of prosperity and of industrial recovery, there are still 1,500,000 persons out of work. Over and above that, there are hundreds of thousands of persons who are fortunate enough to be in employment but are receiving very low wages. That condition of things is incompatible with prosperity.

The right hon. Gentleman admitted that a rise in the cost of living has taken place. That was a valuable concession because upon that issue there has been considerable controversy in the past. It seemed to me that the right hon. Gentleman was disposed to decry the past declarations of his colleagues because, in reply to a question which I ventured to put to him during his speech, he said that the Government had never claimed they were responsible for lowering food prices; and I gathered that it has been the policy of the Government throughout to assist in raising the wholesale price level, well knowing that the corollary of a rise in the retail price level was inevitable. Unfortunately for the right hon. Gentleman's argument, I have to invite his attention to a declaration made either by the Government, or by representatives of the Government, or, at any rate, by someone associated with the Conservative party at the last General Election. I have a leaflet before me which is headed "The Housewife's Budget." It is clearly an appeal to the housewives to support the National Government and reject the Labour party. It contains the following statement: To-day"— that was in 1935— 18s. will buy as much food as £1 would have bought in 1930. That seems to indicate that the Government regard lower prices as a virtue. It was an election cry. I suggest that the right hon. Gentleman would not care to repudiate that document, or, if he did, would not repudiate that declaration. Moreover, it goes on to say: The plain facts are that the National Government has (1) helped the countryside to produce more home-grown food; (2) enabled the farmer to get fair prices for his produce; and (3) kept food prices to the housewife well below what they were five years ago. Clearly the reference to five years ago had some relation to the Labour Government of that period. What is the view of the Government? Do they believe in lower food prices or higher food prices, or what? If I can help them to make up their minds, I would do so by directing attention to some definite declarations by certain. Members of the Government. The former Financial Secretary to the Treasury, now the Minister of Agriculture—who might very well have been present this evening because the subjects under review are appropriate to the activities of his Department—said in June, 1936: The Committee, I am sure, will marvel at the remarkable steadiness with which we are able to supply cheap and plentiful food to the people of this country. They believed in cheap food and that the Government were capable of supplying it. The Secretary of State for Scotland, who was formerly Minister of Agriculture said at Birmingham in April, 1935: In 1930 food prices were 45 points above pre-War level. In 1931 they were 31 points. To-day they are only 22. The facts of the case are on our side. He waxed almost lyrical about it and regarded it as a virtue in the Government to have reduced food prices below the level of 1930, when the Labour Government were in office. I am in some doubt what is the actual policy of the Government, whether it is higher prices, low prices, or what. It is for the right hon. Gentleman opposite to say.

I pass to the facts of the situation. Let us consider exactly where we stand; in July, 1935—I prefer to start then—all items in the cost of living index were 43 points above the 1914 level. For July this year they were 55 points above. That is a substantial increase. Is that the deliberate policy of the Government? If it is, we should subject it to close examination in relation to the reaction on those people with whom we are primarily concerned in this Debate. Let me deal with food alone. In July, 1935, the food in the cost of living index was 26 points above pre-War level, but now it is 40 points above. That is a considerable increase which requires some explanation. It will not be disputed, as my hon. Friend the Member for Gower declared, that the trend is in the direction of still higher levels. How the Government propose to combat those increases I am unable to say, and the right hon. Gentleman gave us very little information. He did remark, however, that as regards the Government's fiscal policy, there was an element of flexibility about it which, I gathered from what he said, had the effect of preventing prices rising too high or going down too low.

It does not appear to me that flexibility is consistent with a tariff policy because, once a tariff is imposed, it is injudicious to disturb by too much flexibility the industries affected. If an industry is dependent upon a tariff—and the same thing applies to agriculture—it is necessary to preserve a large measure of stability, and fluctuations are impracticable. I emphasise the point that if the sole measure of relief the Government can offer is flexibility in relation to tariff policy it is hopelessly inadequate. As far as I could gather the Government have no other machinery at their disposal.

The right hon. Gentleman referred to distribution, which has been mentioned by almost every speaker in this Debate. When I ventured to ask him what he meant by control of distribution, he corrected himself immediately by saying that what he meant was that the Government were reviewing distribution. What earthly good is that? Reviewing distribution is of little value. Surely the Government's long experience of the disparity between wholesale and retail prices, fluctuations, the absence of proper organisation and the defects in the existing marketing schemes, should have induced them to provide more effective control of the distribution of food supplies. As we know, there is a Food Council, but what it does we are quite unable to say. Certainly the right hon. Gentleman did not furnish much information on its activities. It meets presumably from time to time and has discussions and may make reports, but whether they are of any real value is, I think, open to grave doubt. Therefore, it seems to me that the case against the Government has been made out. They have not availed themselves of the opportunity to deal effectively with the tendency for food prices to rise.

I turn to some other aspects of the situation, in our judgment equally, if not more, important. During the Debate certain speakers have referred to the fact, and it is indeed a fact, and unchallengeable, and therefore I do not venture to dispute it, that wages have shown a tendency to rise. The Government may, if they wish, take credit for that, although I think it might more properly be ascribed to other causes; but on that I shall not say a further word. While it may be true that those who are fortunate enough to be in employment are receiving somewhat higher wage rates than before, and may receive even higher wage rates because of the operation of the collective machinery associated with industry, and in some degree because of the sliding scales in certain industries, it is equally true that those who are not subject to these collective arrangements, although engaged in remunerative employment, are worse off, and those who are in receipt of old age pensions, unemployment assistance allowances and unemployment benefit of the standard variety are in a most awkward predicament in view of the increase in the cost of living. We on these benches, and I say this with the utmost emphasis, are more concerned about those helpless and apparently unprotected persons than about any other section of the community.

Let me present the facts of the case, though I am conscious that my hon. Friend, in his most admirable opening speech, went a long way in this direction. There are 214,901 old age pensioners in receipt of public assistance. That is the figure for January this year. It is a very high figure indeed. I regard it as alarming. It is an astonishing fact that in spite of getting this State-regulated benefit, for such it is, there are 214,000 persons who are compelled because of their inability to reconcile the amount they receive with their needs, to go to public assistance committees. In effect, they are pauperised in spite of being recipients of State benefit. That is a situation which the Government cannot possibly ignore, nor can public opinion.

I present one or two further facts. A great many persons are in receipt of outdoor relief. I am not speaking of those who are infirm or who are the inmates of public institutions, but of the recipients of outdoor relief; whether they are in receipt of payments from the Unemployment Assistance Board or anywhere else is beside the point. I give the figures for England and Wales, and leave Scotland out of the reckoning for the moment. In 1930 there were 800,000 persons in that category. That is a very large number, even when the Labour Government were in office; but the number in 1936, the latest available figure, was 1,200,000. It is remarkable, is it not? Perhaps the right hon. Gentleman might address himself to those comparative figures. It is truly remarkable that 400,000 more persons have been compelled to apply for outdoor relief, in spite of the changes which, the Government maintain, have led to prosperity. Excessive expenditure has arisen from the excessive demands upon the local authorities. In 1930, we spent upon outdoor relief in England and Wales £17,000,000, but in 1936 we spent £30,000,000.

Those facts bring me to a very important consideration, the effect upon the local authorities, particularly in areas where poverty is prevalent—Durham, South Wales, Cumberland, parts of Scotland, Lancashire and the like—which are overburdened by the financial responsibilities imposed upon them by that demand. To the extent that local authorities are compelled to undertake them, those financial burdens must necessarily be thrust upon the ratepayers, many of whom are shopkeepers and traders who, in turn, may raise their prices against the poorer sections of the community in their area. Thus there is a vicious circle, to which the Government must give their attention. It would be far wiser, in our judgment, from the national as well as from the local standpoint of householders, traders and others affected, to place that burden upon the national Exchequer rather than to impose it upon the local authorities.

I am conscious that the matter is a very big one and that a great deal more remains to be said, but I shall make only one or two further suggestions before I sit down. I recognise that this is not the appropriate occasion for suggestions relating to legislation, but I think I may say, without transgressing the Rules of Order, that the Government might very well hold an inquiry, even though inquiries are not altogether adequate, into the conditions in which old age pensioners are living. Let us bring out the facts. There are two sections of old age pensioners, and one section is made up of those who live on the 10s. per week; a man and his wife, for example. Last week I had many letters because of a certain episode which occurred in the House, for which I hope I may be forgiven. I find cases of this kind: a man and wife, aged 70, with 10s. a week to live on, refusing to apply to the public assistance committee. Imagine that situation; what kind of life must it be for them?

The British Medical Association laid down a minimum of 5s. 10½d. as the lowest possible standard on which a person could live for a week. These figures were open to great question, but there they are. I ask the Government to apply their minds to the question how these people live. Let us have it out; let us get the facts. If there are people in our midst who are not receiving adequate amounts, and are therefore not living properly and adequately, the matter ought to be corrected. I venture the opinion that that is not asking too much of the Government; it certainly is not asking too much at a time when we are all agreed that there is an abundant measure of prosperity in the land, whoever cares to take the credit for it. I go so far as to say that the Government can have all the credit they like so long as our people are satisfied.

I would use the same argument in connection with those who are in receipt of unemployment payments. There are two categories. First, there are those persons who are in receipt of standard benefit—the insured category. I am sorry that the Minister of Labour is not present, but the Parliamentary Secretary is here, and perhaps this view may be conveyed to the Minister. The Government have admitted that there is a very large surplus at the disposal of the Unemployment Insurance Fund. They have set aside some of it for eventualities, which seems to me to be an admission that things are going to be worse. Is it not possible in existing circumstances to use some of that surplus to raise the scale? With regard to the second category, namely, those who are in receipt of payments from the Unemployment Assistance Board, there a measure of flexibility is quite possible. It is open to the Board, having regard to the circumstances, to raise the scale, and I would emphasise this fact, that, since the unemployment figures are going down, as the Government maintain, and rightly maintain, is the case, the financial burden on the Unemployment Assistance Board is less, and it is easier for them to provide higher scales during such a period.

I feel that there is general disappointment in all quarters of the House at the inability of the Government to respond to the demands that have been made. It is admitted that there are serious defects in relation to the distribution of our food supplies and the adequacy of our food supplies. It is also admitted, I think I am on safe ground in saying, that many persons in this country are living under conditions of hardship. I would ask the Government what is going to be done about this matter. For the next three months we shall not be meeting, and there will be no opportunity for us to present our views to the Government. Even hon. Members on the other side who have responded sympathetically to the demands made from these benches will not be able to present their views to the Government. What is to be done during that period?

I beg the right hon. and gallant Gentleman who is to reply to indicate favourably and sympathetically what the Government's intentions are. If when we return, as we hope to do in October, food prices have risen to a higher level, it may have a very serious effect on the Government. It is not to be supposed that this agitation will die a sudden death. It will go on and on, and, if I may use a phrase that we sometimes hear from a right hon. Member of the House, up and up until it becomes very awkward for the Government. Therefore, I submit that the food supplies of the people cannot be left to the higgling of the market, or the interplay of competitive forces, or be subordinated to profit-making. That is our case. But we recognise that this is not the appropriate occasion for raising the issue of national as against private ownership. All that we are asking is that in this time of so-called prosperity the Government might properly and sympathetically consider the legitimate claims of the poorest section of the community.

10.26 p.m.

Lieut.-Colonel Colville

The Consolidated Fund (Appropriation) Bill annually gives an opportunity to the House to debate subjects of special interest, and I think we shall all agree that the subject chosen for debate to-day is a very proper one for discussion. As my right hon. Friend the President of the Board of Trade said, we have ranged over a very wide number of subjects affecting a number of Departments. That was true when he spoke at about six o'clock, and in the hours that have followed the range has been even wider. Hon. Members will, therefore, not expect answers on all the points that have been raised, but the general nature of the Debate has been interesting and in many respects helpful, and a great number of suggestions have been made which will be properly noted and examined. It would, perhaps, be a little invidious to choose among the many speeches that we have heard, apart from those of the giants of the Front Bench, but I would mention two. The hon. Member for King's Norton (Mr. Cartland) and the hon. Member for Llanelly (Mr. J. Griffiths) both made speeches which struck me as specially interesting and full of suggestion, and their points will certainly be examined. The hon. Gentleman who spoke last sought at one time to introduce the note of a Vote of Censure, but he did not carry it very far, because later he himself rather carried on the general tone of the Debate and made some suggestions. He did, however, allow himself to brandish certain election manifestos and articles, a practice that is not unknown in the House, and derived satisfaction from reading them, as many people did at the time of the election, to judge from the results. I do not pro- pose to discuss them in detail, but they seemed to me to be accurate statements of fact at the time.

I would remind him that, though prices have risen since that date, purchasing power has also risen. In fact, the hon. Gentleman himself used such phrases as "manifest improvement" and "abundant prosperity," indicating that a great improvement had taken place concurrently with the increase of prices. My right hon. Friend dealt with the trade aspect of the question and emphasised that an upward movement in prices was not necessarily unhealthy and was, in fact, a necessary accompaniment of a revival. I would remind the House that it was the fall in price of primary products, such as coal, rubber and wheat, that ushered in the great depression. I well remember the efforts made by the Labour party when in office to do something to check that fall. I remember many evenings spent on the Coal Mines Bill, the purpose of which was to provide some machinery to check the fall that was taking place in a commodity of first-class importance, namely, coal, and therefore I would ask hon. Members to keep in mind the problem which affected their Government at that time, and which they sought to meet in various ways.

Hon. Members will be familiar with the report of the Macmillan Committee, which is regarded as being of very great value; and on the subject of prices I would like to read a relevant passage from the report, which I was studying carefully this morning in preparation for this Debate. The report says: Our objective should be, so far as it lies in the power of this country to influence the international price level, first of all to raise prices a long way above the present level, and then to maintain them at the level thus reached with as much stability as can be managed. Again in the report these words occur: A large rise towards the price level of 1928 is greatly to be desired." [An Hon. MEMBER: "Wholesale prices."] I am speaking. as I said, of primary products. The report appeared in June, 1931, and I would remind the House that prices fell for some time after that, so that what was true at that time must have been even more true at a later date. When hon. Members ask how far we wish to see this rise of prices continue, it is impossible to give a categorical answer, but it is, I think, quite permissible to point to the indication given in the report of the Macmillan Committee in relation to these prices when they say that: A large rise towards the price level of 1928 is greatly to be desired. I do not think that I could make a more accurate statement than that, and it is one over which the House should ponder. It is natural that the individual should look at the immediate background and not at the distant background. The housewife, the one who is purchasing for the family requirements, is really not so much interested in the price levels of 1929 or 1930 as in the changes which have been taking place in a week or in a month; she is thinking more of the immediate changes. I think that we all should recognise that we make a mistake if we do not keep this fact in mind. But having said that, I agree that the Government, and the Opposition, which has been a Government and hopes some day to be a Government again, must have regard to the fuller picture, and it is that fuller picture which I want to develop for a short time. The Prime Minister quite recently, in answer to a question in this House on this subject, said: With increasing prosperity and improved employment there is a natural tendency for prices to rise somewhat above the very low level to which they fell during the slump, but there has been no abnormal development in this country, and the cost of living is still decidedly lower than it was before the depression started in 1929 and 1930."—[OFFICIAL REPORT, 4th May, 1937; col. 1000, Vol. 323.] The movement of the cost of living is, of course, a matter which must be carefully watched. We do not deny that for a moment. That is why I said that it is a proper subject for debate to-day before we adjourn for the Recess and a wisely chosen subject; but I claim that, on the present facts, it is not a cause either of surprise or alarm. It is quite true that the cost of living has risen since last year and even since last month; and incidentally this last rise is about the normal seasonal rise between these two months, and the point should be noted by the House. Even now the Ministry of Labour index figure is 55 above the 1914 figure, which is precisely the same as it was for the corresponding month of 1930, and less than the figure of 61 in 1929. Let me say a few words on the question of the index figure, because that is a matter in which great interest has been shown in the Debate. The hon. Member for Gower (Mr. Grenfell), the hon. Member for Birkenhead, East (Mr. White), the hon. Member for West Birmingham (Mr. Higgs), the hon. Member for King's Norton and the hon. Member for Llanelly all showed a great deal of interest in the inquiry which is being set afoot by my right hon. Friend the Minister of Labour to investigate working-class expenditure. Although this is not my Department I have thought it right to say something further on that matter. In considering the method of inquiry into working-class expenditure, which is to be undertaken in the autumn, with a view to the revision of the basis of the cost-of-living index, the Minister of Labour will have the advantage of a committee representative of various interests, including the interests of the consumer. Full consideration is to be given to all the points which have been raised in the Debate. The points have been duly noted and will be carefully looked into in the OFFICIAL REPORT to-morrow.

I should like to stress the fact that the inquiries will be conducted with the assistance of local committees which it is proposed to set up for the purpose. The households from whom information is desired will be visited personally in order that explanations and guidance may be given where necessary. The hon. Member for Llanelly said that the householders might be puzzled and bothered with forms put in at the door and left to be filled up. There is no intention of doing anything of the kind. If the check is to be valuable it must be conducted in a sympathetic, intelligible and human way, and it is the full intention of the Minister of Labour to see that it is so conducted. The hon. Member for Birkenhead, East, asked that the inquiry might be speeded up. If it is to be a real picture of value to us in considering the whole question of the cost-of-living index, it cannot be speeded up very much. It must take a certain period. There will not be any time lost, but it would be inaccurate and misleading to say that you can get a valuable and reliable picture on which to base our calculations for the future if you hurry too much. The points made by hon. Members in regard to this valuable develop- ment will be taken into account by those who are responsible for its administration.

Although we are taking steps to inquire into the cost-of-living index figure and examining household expenditure, I do not wish to cast any doubt on the present cost-of-living index figure. We are willing to examine it and see where it ought to be checked, but in the meantime it is a figure which substantially, as I think will be admitted, gives a good picture on which to proceed. The year 1929 might perhaps be considered as the last normal year—it is hard to say what year is normal—before the great depression set in, and it will be observed, therefore, from the present figures that the cost of living has not yet regained its pre-slump level. We have had many figures quoted and I do want to worry the House with many more, but there are some to which I must refer. Looking at the cost-of-living index figures over a period of years I find that it was at its highest, 249, in 1920. It declined sharply in 1921–22; and then for a longish period it remained round about the 170 mark. From 1923 to 1927 it did not move very much, By 1928 it had moved about 10 points and in 1929 to 1930 it moved from 164 to 158, and by 1933 to 140. From January to July of this year the average figure—I have been giving the average annual figure all through—is 152.

It has been said already, but I would stress it again, that low and falling prices almost invariably accompany a period of depression and that an upward movement in prices almost invariably accompanies a period of recovery. I am not stating a policy, I am stating a fact, and it is a fact to which we cannot shut our eyes. There is nothing in the figures which suggest anything abnormal. Indeed, in my view, instead of there being any cause for panic or alarm, I should have thought it was a matter for congratulation that the revival that has taken place in this country should have reached its present extent without a larger rise in the cost of living, having regard to the movement of prices abroad. It should also be borne in mind that the rise in prices over the last lour years has been associated with a great increase in working-class purchasing power, which has come about in two ways, by improvement in employment and by improvement in wages.

Mr. Jenkins

Does not the hon. and gallant Member think that with new machinery and improved methods of production there should be a continuous reduction in the costs of production and, therefore, a fall in prices?

Lieut.-Colonel Colville

As I have said, experience shows that a period of depression is invariably accompanied by a fall in prices and a period of prosperity is accompanied by a rise in prices. Mechanisation, of course, is proceeding apace, and it cannot be ignored. It is true that the industrial changes which have been going on may have had some effect in that direction, but, nevertheless, the fact remains that with a downward movement in prices there is a depression in trade and with an upward movement in prices there is an improvement in trade. As I have said, the rise in prices during the last four years has been accompanied by an increase in working-class purchasing power. As my right hon. Friend the President of the Board of Trade has said, when we have discussed the question of unemployment on previous occasions, it has been in rather gloomy circumstances. What is the position to-day? It is worth noting, before we part for the Summer Recess, that during the years 1932 and 1933, when the cost-of-living figures reached rock-bottom, unemployment figures were at their highest. It is not necessarily a good thing to aim at the lowest prices possible, because we must take into consideration also the fact that the lower the prices the greater the unemployment.

The hon. Member for Seaham (Mr. Shinwell) asked me the policy of the Government in regard to prices. It is, in general, that we must preserve the mean between bountiful supplies to the consumer and remunerative prices to the producer. A low level of the cost of living, if it is accompanied at the same time by a high level of unemployment, is not necessarily a satisfactory state of affairs. I hope the House will not consider that I am flippant if I tell a story to illustrate that. An Irish workman in a steel works in Scotland some years ago was complaining about the cost of living. He said to his friends that in that town in Scotland the cost of living was too high, and that when he was in Tipperary eggs were 6d. a dozen. One of his mates said, "Why did you ever leave Tipperary?" and he replied, "Because I had not got 6d."

I think there is sometimes a tendency to think that all would be happy and well if the cost of living were low, but it would not be so, unless there was an improvement in trade and employment with it. That measure of improvement we have to-day. The average level of unemployment for the first quarter of 1933 was as high as 2,845,000, whereas for the first quarter of this year it was 1,639,000, and on 21st June it was 1,356,000. The hon. Member for Sea-ham was not quite right when he said that there were over 1,500,000 unemployed, for the figure is slightly better than that. Those figures show a very considerable degree of improvement in that period.

In addition to absorbing that number of unemployed, industry has been able to take in a very large number of new entrants. On 31st June, excluding agriculture, there were approximately 11,500,000 insured persons in work in Great Britain, compared with an average figure of 9,375,000 for the second quarter of 1932. Thus, partly by the rescue from actual unemployment and partly by the intake of new entrants to industry, over 2,000,000 people have found work during that period. Therefore, it is incontestably true that from that cause the purchasing power of many households has been increased. The hon. Member for Hitchin (Sir A. Wilson) remarked on the increased sales in the retail trade. That is a satisfactory feature, although hon. Members must not overlook the fact that some of that increase is due to increased prices; but even taking that into account, the volume of retail sales is a satisfactory feature at the present time, pointing to the increased purchasing power of the working class. The question of wages has been referred to by a number of hon. Members, and I do not intend to go into it in detail at this time of night; but the Ministry of Labour indicate that at the beginning of the month the average level of weekly full-time wages was estimated to have been about 7 per cent. higher than in July, 1933, and about 2 per cent. higher than in July, 1929.

Mr. S. O. Davies

Why the expression "weekly full-time wages"?

Lieut.-Colonel Colville

That is the Ministry of Labour's expression. Those movements are going on all the time. Perhaps the most recent is one which must have come to the attention of many hon. Members, that is to say, the engineering agreement, which covers some 500,000 men and affects a very considerable sum of money. I have details of it here, taken from that excellent newspaper the "Daily Herald," but I do not think I need give them to the House in order to convince hon. Members that it is evidence of what is happening from day to day in the way of increases in wages. I think it would be well to point out, before passing from the subject, that the momentum of that movement is increasing. The Ministry of Labour report that in the first six months of 1937, wage changes resulted in a net increase of about £406,000 per week at full-time rates for more than 3,200,000 workers. At the present rate of progress 1937 will greatly eclipse 1936 in regard to wage increases. The total net increase in full-time wages for the 12 months of 1936 was about £493,000, whereas in six months of this year we have reached a figure approximating to that. It is evident that with the increased cost of living there is an increased purchasing power.

Mr. Grenfell

Does not the right hon. Gentleman see from these very figures that the position of the wage-earner is considerably worse?

Lieut.-Colonel Colville

I do not agree, because there are a great many items which are not recorded here. It was the hon. Member himself who said that he estimated the total increases made to be in the neighbourhood of £50,000,000 a year. Again, quoting from the "Daily Herald," which has also been trying to estimate the figure, I find that on 21st June it expressed the view that the cash value of improved wages and conditions secured by the unions in the last two years probably amounted to at least 75,000,000 a year, so that the paper was more optimistic than the hon. Gentleman.

Mr. J. Griffiths

The hon. Gentleman is more accurate.

Mr. G. Griffiths

Did the hon. Member see in the "Daily Herald" where 165,000 Yorkshire miners had a reduction of 6d. a day?

Lieut.-Colonel Colville

I do know that the increases in relation to the reductions make good reading at the present time. Many hon. Members have said that they are inclined to agree that the purchasing power of those in work has been increased, and that therefore the shock of any increase in the cost of living has been substantially met, but they have said, "What about those with fixed incomes?" Those with fixed incomes are those who are on unemployment assistance and those in receipt of old age and widows' pensions and war pensions. Taking first those on unemployment assistance, as regards unemployment allowances which are paid by the Board the effect of any change in the cost of living is a matter which receives the close attention of the Government and the Board. The initiative for making any proposals for the alteration of the scale rates rests, under the Act, with the Board. Hon. Members who have studied the Board's report, which has just been issued, will recognise the interest and care which they devote to the discharge of their responsibilities to those within their scope. The House can be assured—I say this with full responsibility—that they are fully conscious of their duty to make proposals if the occasion should arise.

Mr. S. O. Davies

It has arisen.

Mr. Davidson

The new Unemployment Assistance Board scales of relief do not become fully operative for a certain period yet. In the meantime in Glasgow, there are reductions of from 2s. to 7s. Does the right hon. arid gallant Gentleman mean that they can be immediately reconsidered by the Board and that before the new scales are fully operative they can make changes?

Lieut.-Colonel Colville

No, I cannot go beyond what I have said. The report shows that the Board are gaining the confidence of people by the way they are handling this problem and in their carrying out of their duties under the Act the House may be assured that they are fully conscious of the responsibility which lies on them. Where War pensions are concerned—the point was mentioned by the hon. Member for Barnard Castle (Mr. Sexton)—the position is that the rates of pension made effective by the Royal Warrant in 1919 were at that time deemed to be based on the cost of living for that year, which was, of course, much higher than it is to-day, the figure being 115. It was actually provided in the Warrant that such rates should be increased or decreased according to the movement of the cost of living as certified by the Ministry of Labour, certain minimum rates being fixed. That was the position under the Warrant of 1919. No reduction has ever been made and the rate is still that which was originally fixed by reference to the index number of 115. The Minister of Pensions in 1928 announced that the existing rates would be stabilised, so far as they were dependent on the cost of living; so that although within the last year or two there has been an upward movement in the cost of living, we have to bear in mind, in regard to service pensions, the history which I have just put before the House.

Then we come to old age and widows' pensions. Here I am not sure whether or not the claim is that these should be linked with the cost of living. If so, the House should realise that that would be very unfortunate for the pensioners. I made a calculation this morning to find out how these pensions would have stood in various subsequent years if, in 1919, they had been linked with the cost of living. I find that in 1919 the amount would be 10s., but in 1925 it would be 7s. 10d., in 1932 it would be 6s. 5d., and in 1933 it would be 6s. 3d. That is the lowest point. To-day it would have been 6s. 9d. Thus, taking the average figure for these years, I can demonstrate to the House that the fixation of old age pensions on the basis of a strict link with the cost of living, if it had been carried out, would have been unsatisfactory.

Another point which will appeal to the House is the difficulty of running a contributory pension scheme on the basis of payments which would fluctuate with the cost of living. Therefore, I take it that the request really is for a revision of the flat rate, though it has been put very forcibly by some hon. Members that there should be a link between the pensions and the cost of living. Several hon. Members, and particularly the hon. Member for Spennymoor (Mr. Batey), spoke about the question of increasing the flat rate, and he mentioned that the Miners' Federation had made certain proposals. I had to deal with that question on the Motion for the Adjournment a few nights ago, and I must repeat one or two of the figures which I gave then, because several hon. Members are here now who were not present then. In the first place the percentage of those who are pensioners and who are also drawing public assistance is given as 9.7 per cent. A year ago the figure was 9.3 per cent., and in 1935 it was 9.5 per cent. There has not been any wide variation in the last three years in the number who have gone on to public assistance. Looking further back I find (although I have not the complete figures) that for a few years preceding that movement, although there was a slight increase, the figure was similar. Even during the years when the cost of living was falling—1931, 1932 and 1933—an increase was taking place.

On the question of cost, the hon. Member for Spennymoor asked what it would cost to increase the old age pensions from 10s. to 15s., a 5s. rise, for those over 65. It would cost £33,000,000 a year, and to that would have to be added £2,500,000 for widows from 65 to 70, whom I do not think we could treat differently. That would come to £35,500,000, and if all pensioners, including widows under 65, were given the same treatment—and there again I think it would be difficult to differentiate—it would reach a figure of £43,000,000. If the suggestion made by the Miners' Federation and by many others were adopted, the amount would come to 86,000,000. I must remind the House, on the cost to the State of pensions at the present time, that the total cost of old age and widows' pensions to those over 65 in 1937 was, for pensioners over 70, £45,000,000; for those between 65 and 70, £21,000,000; and for widows between 65 and 70,£5,000,000. Of those figures, £45,000,000 is found entirely by Votes in Parliament, and the remainder comes from the Pensions Account, to which there is an Exchequer contribution, which in the present year is £16,000,000. That makes a total figure in the present year of Exchequer money for pensions of £61,000,000.

Mr. Buchanan

Does that include ex-soldiers' pensions?

Lieut.-Colonel Colville

No, only old age and widows' pensions. It is of interest to note that the figure of £61,000,000 for pensions compared with the figure of £46,000,000 in 1930. We are spending now £15,000,000 more on pensions than the late Government were, and the automatic growth is going on all the time. Without fresh legislation at all, it will, in an approachable time, come to £80,000,000. Therefore, we are at present spending more on old age pensions than any previous Government, and that expenditure is automatically rising. The social services as a whole form a very important part of our Budget expenditure. In 1937, the present year, the Estimates provide for no less than £215,000,000 for old age and widows' pensions, for housing, for health, for unemployment insurance, and for assistance to education, and the comparable figure, if I may take the House back to 1925, for that group was just over £100,000,000, whereas for 1930 the figure was £155,000,000, as compared with £215,000,000 this year for that group of social services. I should add, in order to make the picture quite complete, that in 1930 the Labour Government also borrowed £36,000,000 for unemployment benefit, which does not appear in the Budget figure, and that would therefore have to be added.

It seems to me, viewing this picture as a whole, that hon. Members have shown a proper interest in this question of the rise in the cost of living. Many of them have shown some anxiety about the future, and I assure them that the Government will not fail closely to watch the cost of living. We believe that the rise in commodity prices has not been unhealthy, but is an essential part of the trade revival which is taking place. We also believe that the consequent rise in the cost of living up to date has not been disproportionate, and the rise has, we believe, been compensated for over a wide range of our population by a greatly increased purchasing power.

When we are asked to consider in one way or another the provision of further State Assistance for those who do not benefit so quickly by a rise in industrial prosperity, I ask the House to remember the financial prospects before us. This year we have to face the immense sum of £862,000,000 as our total estimated national expenditure. This is not including the £80,000,000 which may be borrowed under the Defence Loans Act. These are immense figures, and it appears that there is no escaping from them. When we are asked to give consideration to further expenditure it is proper that we should have full regard to these financial considerations, neglect of which has in the past in this and other countries brought about loss of credit, shaken confidence in the Administration of the day, and tended to endanger those very social services which it must be our strong endeavour to preserve and wisely and surely to build up.

Bill committed to a Committee of the Whole House for To-morrow.