SPECIAL AREAS (MONEY).

HC Deb 12 March 1937 vol 321 cc1521-606

Further considered in Committee. [Progress, 9th March.]

[Sir DENNIS HERBERT in the Chair.]

Question again proposed, That it is expedient to continue the Special Areas (Development and Improvement) Act, 1934, until the thirty-first day of March, nineteen hundred and thirty-nine, and to make further statutory provision for—

1. (a) enabling the Commissioners, for the purpose of inducing persons to establish industrial undertakings in the special areas, to let factories in those areas for the occupation of such undertakings and to contribute for periods not exceeding five years towards the rent, income tax, and rates payable in respect of industrial undertakings hereafter established in places approved by the Commissioners within those areas, notwithstanding that any such undertaking may be carried on for the purpose of gain;
2. (b) enabling the Commissioners to make grants towards expenses incurred by local authorities in the repair or improvement of streets in any special area which are certified by the Minister of Transport as being wholly or mainly required for purposes other than those of through traffic, and to contribute towards expenses incurred by owners or occupiers of agricultural land in any special areas in connection with the execution of works of field drainage notwithstanding that the land is occupied for the purpose of gain;
3. (c) enabling the Treasury to give financial assistance for any area outside the special areas, as to which the Minister of Labour certifies that there is and has been for a considerable time severe unemployment in the area, that without such financial assistance there will be no immediate likelihood of a substantial increase in employment in the area, and that employment in the area is mainly dependent on one or more industries which are unable to provide sufficient employment by reason of general depression in those industries:

Provided that such financial assistance shall only be given either by means of subscription to the share capital of site-companies incorporated for the purpose of providing factories in such areas with a view to inducing persons to establish industrial undertakings therein, or by means of loans to such companies, and the assistance provided to any such company shall not exceed an amount equal to one-third of its paid up share capital exclusive of any share capital held by the Treasury; (d) enabling the Treasury to provide financial assistance, not exceeding in the aggregate two million pounds, by way of loan to persons carrying on industrial undertakings which are hereafter established in any special area or, in the case of industrial undertakings occupying factories provided by site-companies, in any such area as is mentioned in the last foregoing paragraph of this Resolution; (e) the payment out of moneys provided by Parliament of any sums required for the purposes aforesaid; and (f) supplementary and consequential matters. In this Resolution the following expressions have the meanings hereby assigned to them— 'Commissioners' means the Commissioners appointed under the Special Areas (Development and Improvement) Act, 1934, and 'special areas' means the areas specified in the First Schedule to that Act; 'Site-company' means a body corporate established for the purpose specified in paragraph (c) of this Resolution, being a body which does not trade for profit or a body whereof the constitution forbids the payment of any interest or dividend at a rate exceeding such rate as may be for the time being prescribed by the Treasury.

11.11 a.m.

Mr. Rhys Davies

After that slight breeze on foreign affairs it is well that we should come back to the Home front; and the first observation I want to make is that I am sure the House will welcome the Chancellor of the Exchequer here this morning. Quite frankly he is regarded as the villian behind this piece; and it is well therefore that we should have him here; and it is also very pleasing to see the Lord President of the Council present for once. I listened to the speech of the right hon. Gentleman the Minister of Labour last Tuesday when he dealt at great length with this Money Resolution covering the Special Areas Bill which is to be presented to us shortly; and I do not think I would be wrong in saying that to those of us who represent depressed areas, and especially to the people living in those areas, his speech was both disheartening and disappointing. It was, of course, as usual, full of vigour and aggressiveness, but it was devoid of anything else. His repeated speeches on this issue are very nearly word for word the same every time he speaks. I could almost make a gramophone record of them. He is working very hard, laboriously producing nothing. He talked of millions of money last Tuesday for new industries, and still more millions for new commitments, but he did not mention a word as to how much had actually been spent. There is a vast difference between the amount allocated by the Government for these Special Areas and the amount actually discharged in cash as I shall show; and certainly he did not mention a word as to the number of persons that were actually employed consequent upon the policy of the Government in these areas.

In brief, the position really is, that in four years the sum of about £11,000,000 has been set aside by the Government to revive industry in the Special Areas and to try to do something in the areas that are to be certified. But out of that vast total the actual cash that has been spent is £2,800,000 according to their own showing. I have been trying to find out how much employment in those four years the Government could have found if they had spent that money in actual wages, and I am sure that my calculation is right. If they had spent all the cash that has been actually discharged on the Special Areas in wages, it would have employed only 7,000 people for a period of four years. That is the real contribution of the National Government to this terrible problem. As stated, if spent in nothing but wages the whole amount of £2,800,000 would have found employment for only 7,000 people for four years, on the calculation of £2 per week per person. The paucity of this provision will be understood when it is realised that in the Special Areas alone in January, 1937, there were no fewer than 335,000 unemployed persons. I thought it worth while to give these figures in this form in order to present a better and more accurate picture than chat put forward by the right hon. Gentleman.

A very interesting thing has happened since the right hon. Gentleman delivered his speech. I have here a copy of a Scottish newspaper, from which it appears that unemployment is at last very acute in his own Parliamentary Division. One of his own friendly newspapers has an article, with great headlines, in which it says: Many thousands more at work, but Leith's idle total is up by 335. I suppose that his own Parliamentary Division will soon be classed either as a special or a certified area. The attitude of the Government towards the depressed areas and towards the industrial depression in general has aroused considerable feeling even among the Government's own supporters, but I do not see many of those critics here to-day. They seem to have caved in at long last. According to the terms of the Money Resolution, a new distinction is to be drawn between the several poverty-stricken areas. The Special Areas are still to remain Special, but other similarly depressed areas are to be "Certified" areas, if you please. The Government have been searching for an appropriate word for a long time. They have used up the words "depressed", "distressed", "location" and "special", and in the end they have adopted a word that fits themselves splendidly—"certified". We are told that: a rose By any other name would smell as sweet. In future, therefore, the country is to be divided up into three categories—the prosperous, the special and the certified areas. There are patches of Lancashire which are expected to be certified, where the Government's new word "certified" is already regarded as a huge joke. The right hon. Gentleman ought to search for and find a better word. We are not ready for the lunatic asylum up there yet. I would be ungrateful, however, if I did not say that we are glad that we are to receive some attention at long last.

Other hon. Members have referred to the failure of the Government to achieve anything substantial towards reviving industrial life in the Special Areas. I should like if I may to call attention to a district which has been deteriorating for the last seven years. I have the honour to represent that district. The right hon. Gentleman has received many deputations about the conditions of things in that area. He knows the plight of some of these localities in Lancashire, and it is hardly right that there should be a further division of the depressed areas as propounded in the Money Resolution. There are four urban townships in my constituency, with a population of 50,000, and ten years ago there were about 10,000 colliers at work in 17 mines. To-day all those 17 pits are closed and there is hardly a miner employed in the whole of those districts. All that has happened in the last 10 years. Nothing therefore annoys the people I represent more than the constant reiteration of the claim of the Government that we are prospering in this country. That statement is a mockery to them. The right hon. Gentleman came to Westhoughton recently to open a miners' welfare centre, which must have cost £600 or £700. Immediately afterwards the pit was flooded and closed. Wherever the right hon. Gentleman walks, devastation follows. I do not think that we shall want him in Lancashire again under those conditions.

I expect that my district will be certified, and therefore I should like to give some further particulars. I hope that hon. Members representing other parts of the country will bear with me while I describe what is happening there. The rateable value of industrial undertakings in the four townships I have mentioned, 10 years ago, was 50,000; to-day it is only about £5,000. The result is, that the local authorities are seriously hampered and the social and human consequences—here I can speak without political bias—are almost beyond description. Hon. Members who represent Jarrow and various districts in Durham, South Wales and the West of Scotland tell us of the conditions there, and certainly their plight is very serious; but I would venture to call attention to the plight of my own district. I recently asked the Minister of Health for figures as to the infantile mortality rates in the Special Areas of Scotland, England, and Wales. We are entitled to measure the standard of civilisation in any country by its infantile mortality rate. The nation that neglects its children is a nation that does not deserve to succeed. The infantile mortality rate in 1935 throughout the country was 59 per 1, 000, and we all rejoice that there has been a reduction in the rate during the last quarter of a century. What is the position in Aspull, a small township in my Division? In that township, with a population of 7,000, the infantile mortality was not 59 per thousand but 149. I object, with all the force at my command, that a child in Aspull has only one-third the chance of living as a child in Bournemouth or St. Annes-on-the-Sea. That is one of the protests that I make against the Government in their treatment of the distressed areas.

Take another aspect of life in that little township. The local authority has condemned about 100 houses as unfit for human habitation, but not a single house of any kind has yet been built by the local authority. The township of Aspull, as the hon. Member for Wigan (Mr. Parkinson) knows, is at best nothing but a huge rubbish heap; it is derelict. And what makes it more annoying and more irritable is, that the people who have taken the wealth out of the ground in that locality are now enjoying the riches they have thus obtained, and probably living in Harrogate, Morecambe, Bournemouth, and in luxurious flats in London. The Government ought to devise some scheme whereby people who have taken the wealth out of the land ought to pay some of it back in order to help those who are left stranded in the slums they have created. Perhaps the House will pardon me for feeling a little strong on this issue, but every lion. Member is entitled to mention what happens in his own Parliamentary division.

Let me now deal with the position in the County of Lancashire as a whole. I object to the policy of the right hon. Gentleman in taking the statistics for the whole of Lancashire as the basis of his calculations of distress. The population of Lancashire is greater than that of the whole of Scotland and twice that of Wales. We could put several Durhams or Monmouth-shires in Lancashire and not feel their presence. Without entering into a competition in poverty, however, I think the case ought to be thus stated. Manchester University, the Lancashire Industrial Development Council and the local authorities have appealed to Members of Parliament of all parties for Lancashire Divisions to ask the Government to do something for these parts. What has happened? A munition factory has been put down at Chorley. An hon. Member opposite the other day complained that the hon. Member for Bishop Auckland (Mr. Dalton) had referred to the suspicion created in that part of Lancashire about the setting up of the munitions factory at Chorley, ten miles from the depressed Wigan coalfield. The Government will not easily be able to remove that suspicion which prevails about putting a munitions factory in the constituency which is represented by the Chairman of the whole of the Tory party in this land and which has hardly any unemployment.

Hon. Members said we ought not to be suspicious of that. I remember that, when we were on the Government Front Bench opposite, and the right hon. Gentleman was on this side—and particularly the present Minister of Health and the Deputy-Postmaster General—if that Labour Government, dealing with these distressed areas had opened a munitions factory in any part of England or Wales in a constituency represented by a Labour Member having little unemployment, all the newspapers supporting the Tory party would have howled so long and wildly that they would have thrown us out of office. At Chorley, they removed, as part of their policy to solve unemployment I suppose, the employment Exchange from a Church vestry to the local Conservative Club. The right hon. Gentleman the Minister of Labour has condoned and supported that. Let me tell him that if a Labour Government at any time allowed an employment exchange to be transferred from any church vestry to a Labour drinking club, hon. Members opposite would have howled still more. I will ask the right hon. Gentleman later to give us some more information on that matter.

Apart from putting that munitions factory ten miles away from the Wigan coalfield, where the distress is heaviest, the following remedies are suggested. First of all, the attention of the Service Departments is called to the heavy unemployment rates prevailing, so that industrialists in those parts may tender for contracts for those Departments. I hope the right hon. Gentleman the Chancellor of the Exchequer will bear with me when I ask him what is the use of telling us that the Air Ministry, the War Office, and the Admiralty will allow firms in my division to tender for contracts for those Departments, when there are hardly any firms there to tender? Factories, mills and coalmines have closed down, and consequently it is no help to us to suggest that the Service Departments may give us contracts.

We are then told that tenders from these areas will receive special attention. My experience in dealing with Service Departments is that they will give contracts to firms which, in their opinion, can do the job cheapest and best, whether it is done in a distressed area or anywhere else. I am not sure that part of the problem in this country at the moment, both in the prosperous and the distressed areas, is that there is not sufficient liaison between the right hon. Gentleman's Department and the Service Departments in connection with employment arising out of the rearmament programme.

Hon. Members may ask why I should ask for munitions factories when I am opposed to the Government's rearmament policy. Why should I not do so? The Government have decided on their policy, and they have decided to set up these munitions works. Nothing I can say will alter their view, and if my people are in despair and want work and wages, why should I not ask for munitions work, lest they should starve? I have with me a pathetic note from a young man of 22 years of age. He has written an intelligent letter saying that he has never had a job of any kind. I have another letter from a man whom I have helped to get a job, and he tells me an astonishing thing which I think is worth while mentioning in the House. He states that for eight years while he was unemployed his own family began to look down on him, and now that he has a job and brings home wages, he is once again regarded as the head of his own family.

Hon. Members sometimes throw out suggestions that the unemployed do not want work. I know the problem of dealing with human beings as well as most. I happen to be the Secretary of a society which pays out benefits under that very wonderful scheme, the Health Insurance Scheme, established by the right hon. Gentleman the Member for for Carnarvon Boroughs (Mr. Lloyd George). When it was announced that this munitions factory was to be established at Chorley, 30 men from the village of Blackrod, in my division, walked eight miles to Chorley to look for work, and walked back again, and the answer they received was that they could get work there when all the unemployed in Chorley had been absorbed. When the unemployment rate at Chorley is 15 and the rate in my division is 50, I say that the unemployed in my division ought to have some priority of employment at that munitions factory.

Some people argue that industrialists will not come to these areas because the rates are too high. I do not know what the rates are in Durham, South Wales and the West of Scotland, but in these parts of Lancashire it is true to say that they are about the lowest in the whole county. Then we are told by some hon. Members that we must be very careful not to dub these areas as depressed or Special Areas, otherwise industrialists will shun them. Let me say that the district which I represent has been depressed more or less for eight years. The local authorities have been inviting industrialists to come there, but they have declined, and they declined long before we whispered that it was a distressed area. They will not go there for at least two reasons. First, they do not want to be bothered with trade unionism, and, secondly, the profit factor counts with them more than anything else.

I would like, who ever is going to reply to this Debate, to clear up one mystery. We are told that we are to have another munitions factory in Lancashire. Where is it to be established and when? We are very interested in that proposal. The people of Lancashire are not revolutionary-minded; they have not marched to London behind bands and banners and all the rest of it. The right hon. Gentleman has been moved very much during the last few years by demonstrations in South Wales and Durham, and as a Welshman I have often wondered that the Lancashire people are so mild and reasonable in the circumstances. But I can tell the right hon. Gentleman that there is something more sinister even than marches from Jarrow to London and demonstrations in South Wales, and that is, the gradual deterioration of the physique of the people and the undermining of their morale until, in the end, they become satisfied with the social services. That is the most sinister thing in Lancashire, and I hope that he will do more than is suggested in the papers that he has given us to meet the situation in that part of the country.

I do not like to compare one district with another or to enter into a competition of poverty, but the right hon. Gentleman knows that the problem in Lancashire is unlike anything else in the country. Not only have we unemployed, but we have thousands, if not tens of thousands of skilled men and women working full time for wages that are below the standard which they would get if they were on public assistance. That is a terrible situation. In fact, we seem to be proceeding by stages in parts of Lancashire back to the old Speenhamland system under which it is more profitable to be on public assistance than to be working full time.

I. do not know whether the right hon. Gentleman can deal with the question of Lord Nuffield's grant of £2,000,000, but perhaps he can answer one point. I have been in touch with the secretary of the Nuffield Trust who informs me that none of this money can be used in any district until it has been scheduled as a Special Area. Perhaps the right hon. Gentleman, or whoever replies, will tell me whether, when a district has been certified under these new proposals, it can enjoy any of the £2,000,000 under the Nuffield Trust.

I hope I can carry Members of all parties with me in what I say next. The rationalisation of industry has upset society in this country. Irrespective of the colour of the Government which may be in power at the time, the scientist, the engineer and the chemist have confounded the schemes of the best statesmen and politicians of all parties. I am willing to admit that. We find now, six looms per weaver instead of four in Lancashire and we find a girl of 16 working a machine which puts out of employment 50 adult men at one stroke. That is what is going on everywhere; and in the end a comparatively few people will be required in this great industrialised country to produce all we require. In spite of all the documents that have been published, and all the speeches that have been made, a Government, of whatever political colour it may be, will some day have to face that problem by raising the school-leaving age, abolishing overtime, reducing the number of years which people are called upon to work, and introducing pensions at an earlier age. We shall somehow have to provide in that way for the unemployed, and lift them out of the terrible travail in which they are in at present. We must find ways and means to give them a chance to enjoy some of the riches that other people continue to enjoy in this land of plenty.

11.40 a.m.

Sir John Jarvis

I have been closely associated with one of the worst of the depressed areas since 1934 and I rise to make some observations, not so much by way of criticism as by way of inquiry and suggestion regarding practical points which might be dealt with. The practical problem of the distressed areas needs no elaboration from me, more than to say that, having lived close to it for a very long time, I can appreciate its stark horror and its heart-breaking misery. The problem is not one problem, but many problems in different districts and as those problems have baffled successive Governments, it would appear to many that they are insoluble. I do not take that view. I believe they can be solved, but it seems to me that the time has come when the results of inquiries, reports and advisory committees must be translated into action—swift, practical and determined.

This Resolution breaks new ground, especially in paragraph (a) under which the Commissioners are authorised to contribute towards rent, rates and taxes in respect of new industrial undertakings in the Special Areas and beyond. This is a step in the right direction which ought to be made for the better distribution of industry throughout the country. To achieve this, it is clear that some inducements must be offered to industrialists to take the risks of starting businesses in those areas, because there are risks. My hon. Friend the Member for Whitehaven (Mr. F. Anderson) last Tuesday said that peaceful persuasion ought to be exercised, but that is not enough. The industrialist is entitled to some assurance that he will not be the loser by starting in a distressed area. My first inquiry of the Minister is whether he can give some indication of the maximum allowances which the Commissioner can give under paragraph (a). There is no indication of that in the Resolution. In the most favourable circumstances can he give as much as 100 per cent, and, if not, how near will he be permitted to go to that figure? Many industrialists are waiting to know this and it would expedite the provision of employment if the Committee could have that information.

In any case I wish that these proposals had gone further and had sought to do something practical for the long unemployed men, who ought to benefit under them. Most of these men need training back to physical fitness, training back to their old-time handiness and training in those new tasks which they may have to perform. In my opinion such training could best be given in the works where they were likely to be employed. I suggest to the Minister that the State should pay half the wages of long unemployed ment for the first two or three months before employment. When speaking of long unemployed men, I would suggest a standard, say, that it should apply to men over 45 who have been unemployed for 18 months out of the last two years. My proposal would make it easier for those men to resume their normal working life. It would make it worth while for an employer to give them a chance without risk of loss to himself and it would cost the State nothing, having regard to the saving in unemployment benefit. This is far better, surely, than offering men less than the recognised rate of wages. That is a vicious system and I am all against the underpaying of men in distressed areas. There is a tendency to ask the employment exchanges to send only men of under 40 years of age, and my suggestion would give some of the older men a chance. I should not fear exploitation. I believe it would be easy to devise safeguards against it.

My second inquiry is whether the Minister will give the Committee an assurance that the Commissioners will have a free hand to make the concessions detailed in the Resolution without reference back to the Departments. We heard from the lips of a great statesman the other day that dictators were usually two years ahead of constitutional Governments. If the Commissioners are to succeed, they ought to be at least 105 weeks quicker than that. Let me give the Committee an example of what I mean. At the present moment there is a new industrial undertaking looking for a home. It is an offshoot of a bigger concern, the name of which is almost a household word. It produces a variety of metal products and it is planning to add others. Many of its products do not compete with those of any other industry, and per £ of capital it will employ far more than the average number of work-people. It ought to put at least 500 men into employment before the end of the present summer.

Where is it to go? To London, with all its allure, there to add to London's own problems of traffic, housing, and transport; to Birmingham, centrally situated for distribution, with a large number of fit workpeople, cheap power, and almost all the amenities; or to one of the distressed areas, perhaps far away in the North, where export facilities are available, and where many of the men have been workless for years and years? What facilities can the Commissioner offer, and how quickly can he make his decision? If I can give full particulars next week, does the Minister think that definite proposals can be made immediately the necessary legislation is passed, so that a start may be made in a distressed area before the end of the present month? If the Minister will give me this assurance, I will go to the North myself this week-end, there to endeavour to arrange the business. No question of finance arises, and no new capital is required, for any new capital that may be required is forthcoming, but this concern has commitments for early delivery, and delay would send it elsewhere. That is an example of the importance of the machinery of this paragraph functioning with all possible speed.

There is another point that I might make in regard to this particular industry, and that is that it would employ a large proportion of unskilled and semiskilled men. That is a matter of great importance. When I went to Jarrow in 1934 I was looking for suitable industries for highly skilled mechanics. There are now few, if any, skilled men unemployed in Jarrow, and very few either, I am confident, in other distressed areas. The unemployed men whom I knew in 1934 were very different from those that I know in 1937. To-day we must seek industries which will employ a minimum of highly skilled and a maximum of those unskilled or only semi-skilled. This may be a new orientation of industry in these particular parts, but it is something which we have to face, and, so far as I am concerned, I can see no alternative to it.

My third inquiry relates to paragraph 15 of the White Paper. I want to know whether only undertakings of the light type are to be assisted. If the answer is in the affirmative, it will rule out some of the heavier industries for which some of these Special Areas are peculiarly adapted. I need hardly remind the Minister that it is the heavier industries, like steel, which are letting the country down at the present time, causing delay in the delivery of vital requirements at home, endangering our export trade, raising prices to the consumers, and throwing out of work thousands of men in the steel-finishing trades. I do not desire to raise again at any length the much-debated question of the Jarrow steel works. I only wish to remind the Com- mittee that if this project had not been opposed from its very inception in 1934, it would by now have been delivering a considerable proportion of the steel so badly needed, and that Jarrow would have been a distressed area no longer. In the light of history the decision reached by the committee of three last July was a blunder of the first magnitude, and I regret that I can find no change of heart among those who have adopted a dog-in-the-manger attitude for more than two years past.

The tragedy of Jarrow is that rationalisation has not only prevented ships being built, but now forbids steel being made. Jarrow might have survived the loss of one of these industries, industries which in prosperous days employed no less than 10,000 people, but the loss of both threw out of employment some 80 per cent. of the population. In this home of heavy industries I hope that paragraph 15 does not mean that they will be excluded from benefit. There are some of us who have been working to revive industry in places like Jarrow without expecting the Government to help, financially or otherwise, and I think there would be many more who would come forward if they were given some encouragement and safeguarded against unreasonable obstruction, for there are men of good will who are appalled at the present situation and who would like to give their help.

I would like to say one word in conclusion. We have to face a Bill of £1,500,000,000 for armaments that our land may be safe. I do not quarrel with that expenditure, vast as it is, if it be the price that we must pay for security, but when I search the histories of the great Empires of the past, I learn that they have fallen almost always from dissension within rather than from foes without. We are living in very prosperous times. Trade is booming, markets are advancing, and the demand for skilled labour exceeds the supply. To-day the long-unemployed man is hopeful that this prosperity will soon spread to his distressed area. It is that hope which is keeping him steady. But look to the years ahead and visualise the possibility of a change in the present position for the worse. What then? I am not asking that £1,500,000,000 should be spent in seeking to cure this cruel ill of unemployment, but I am pleading for a bold, constructive, and an immediate policy from the Government, even if it demands help, understanding and fair play from industry and co-operation and unselfishness from labour. I want to see the end of these distressed areas in this Coronation year. It may be—it is—a great task, but have great tasks ever appalled us when we have set our minds to them? Perhaps, after all, it is not so much money that is needed as the fulfilment of the old command to "love thy neighbour as thyself."

11.53 a.m.

Mr. James Griffiths

May I join my hon. Friend the Member for Westhoughton (Mr. Rhys Davies) in expressing, what the Government will surely find out very shortly, that there is in this country profound disappointment at these proposals? The Chancellor of the Exchequer made a speech at that Box in which I think he used the words that this was a desperate situation and that it needed desperate remedies.

The Chancellor of the Exchequer (Mr. Chamberlain)

That is exactly what I said it was not.

Mr. Griffiths

The right hon. Gentleman, at any rate, said that there was a necessity for unconventional and unorthodox measures, but we find, as a matter of fact, looking through these proposals and reading the White Paper, that the Government are relying almost entirely upon their rearmament programme to solve this problem. Apart from the measures of rearmament, what else is there? There are certain industrialists who are taking certain industries into these areas, and we had from the right hon. Gentleman the other day a statement about these industries, while the Secretary of State for Scotland said that the total number of men that it was estimated that all these industries would employ was 3,000. That is all the contribution to this tremendous problem. My hon. Friend the Member for Westhoughton also said that the amount of money which has been spent and which is proposed to be spent upon this problem is trivial as compared with the magnitude of the problem.

I saw the other day a very interesting calculation made by the "Economic Journal," in which the investigator found that in the last 12 years over £50,000,000 had been spent in subsidising the sugar-beet industry in this country. The same investigator found that the county of Norfolk, which has a population of 500,000, as compared with the 4,500,000 in the distressed areas, is receiving in various forms of subsidy from the Government a sum not less than £3,000,000 each year, whereas the commitments for the Special Areas so far amount to £11,000,000. If all that the Government are going to do is to rely on their armament proposals to solve this problem, they may leave these areas in a worse position than they are in now.

I will cite one example in my own Division in order, for the experience of the people there, to warn other Members who are becoming optimistic about the possibility of solving the problem by the re-armament proposals. In 1915, just after the beginning of the last war, the Government established a huge munition works at Pembrey. At its peak it employed 7,800 men. People were attracted to it from all over the country. The Industrial Development Council in South Wales built a garden suburb, and all these people asked the Government whether it was safe for them to go there, whether they could risk their money there and establish themselves, and whether it was possible for them to look forward to some kind of permanency. The Government gave a definite assurance that even at the end of the War part of that factory would be kept open, and that at least 2,000 men would be employed, so that it would be perfectly safe to invest money in building houses. At the end of the War the Government overnight abandoned the whole concern; they left that area derelict and they have done nothing with it. I want to warn hon. Members who seem to be getting optimistic about munitions works. Some day re-armament must come to an end—we hope it will be soon—and when it stops new towns will have been built, such as those in the division of my hon. Friend the Member for Ogmore (Mr. E. J. Williams), and they will have attracted people from all over the country. When the construction of armaments stops, what will happen? We shall have an economic crisis and the men who have been attracted to these places will be left there stranded.

This may be the worst day that has happened for the Special Areas, for in three or four years' time they may be in a worse plight than they are in at this moment. Apart from rearmament, what are the Government doing for the Special Areas? They are dealing with them in a trivial fashion. Another feature of this problem is the way in which we have been driven by our poverty to compete with one another. Last Wednesday evening in this House was a tragic experience. Hon. Members who come from South Wales felt compelled to speak and to vote against the Caledonian Power Bill, because the Commissioner had urged and recommended that the manufacture of carbide should be established in South Wales. If ever there were an example of the need for a State planning authority, it was seen in that Debate on Wednesday. We saw the Highlands of Scotland competing with the Valleys of Wales, and that competition is not only true as between one Special Area and another, but it is true of the areas in South Wales itself. Members of Parliament are almost becoming commercial travellers trying to find industries.

The Government in their proposals have neglected the most serious contribution to this problem of Sir Malcolm Stewart. That is the urgent necessity of the Government taking steps by which the State will control the establishment, location and planning of industry. I asked a question of the Minister of Labour on Tuesday, but I received no reply. The area I represent is not a certified Special Area. We have made representations to the Minister of Labour, and I have led deputations to him in order to put before him the position in our area. I see from the latest returns that the village of Garnant in Carmarthenshire, which 10 years ago was one of the most prosperoous in Wales, has now the highest percentage of unemployment of any exchange in South Wales, namely, 64 per cent. Its pits are closed and its tin works are being rationalised out of existence. We have asked the Minister of Labour to extend the boundary of the Special Area for a few miles in order to bring this district within it. I presume that the reply is to be found in the Financial Resolution, paragraph (c) of which will enable the Treasury to give financial assistance for any area outside the Special Areas, providing there is substantial unemployment and that employment in the area is mainly dependent on one or more industries which are unable to provide sufficient employment by reason of general depression in those industries.

There are three villages in this area—Brynamman, Garnant and Glanamman—and the area is depressed because a huge undertaking has bought up all the tinplate and sheet mills and has concentrated production elsewhere. The unemployment in this area cannot, therefore, be said to be due to general depression in the industry. The figures go to show that the steel industry is at its maximum production, and consequently we should not be able to make out a case that there is general depression in the industry. Will the Minister refuse to certify that area because its depression is not due to the general depression in the industry? I want to cite another possibility. It has been fortunately overcome, but it may arise again. Twelve months ago the town of Llanelly was threatened with complete industrial extinction. One of the firms which own the mines and the plant were proposing to move to the Midlands. If that had been done that area would have become completely derelict, and yet there would have been no general depression in the industry. The Minister said that it was desirable to frame the Resolution in such terms as to make it flexible. I am not concerned with that; I am concerned to know whether we can get these areas certified when they are depressed because they have lost their plants, even though there is no general depression in the industry.

There has been published this week a survey conducted by a body of men and initiated and financed by the Commissioner into the present economic position of South Wales and its natural resources. It embodies a large number of valuable suggestions as to the future. One of the most tragic things in the Report is that time has been slipping by for 10 years. We have been trying to do things now which we should have been doing 10 years ago. In the meantime, men have become year by year demoralised, physically and mentally. The investigators have come to the conclusion that now, after all the transference, though we have lost in South Wales a population equal to our biggest town of Cardiff, there is a surplus of workmen numbering 80,000 for which existing industries can find no employment. The most tragic thing of all is this. They say that of those 80,000 people 20,000 have been unemployed for so long that during their period of unemployment they have reached later middle age, have aged prematurely, that they would have been very much younger now both physically and spiritually if they had been in employment. They say, further, that these 20,000 men have now reached such a stage that it is believed that it will be impossible for them to go back into industry.

I ask the Government whether they propose to take any steps to deal with that tragic part of the problem. It will be many years before those men reach the pensionable age, but they have no prospect of being employed. Finally, I would say to the Government that what it is proposed to do under this Financial Resolution deals only with a trivial part of the problem, and I hope that both inside the House and outside the House we shall not cease to keep this question before the attention of the nation, until the Government have set about tackling it in a real fundamental way, because it is the gravest of our social problems.

12.7 p.m.

Mr. Lloyd George

There is one great advantage in addressing the House at an early hour on Friday. Although the House is always a small one, those who are present all take a keen and deep interest in the particular subject which is being discussed. I am very anxious to say a word about these proposals at the earliest possible stage. I ventured to criticise the first Special Areas Act on the ground of its complete inadequacy, on the ground that it seemed to fail altogether to grasp the magnitude and the gravity of the problem. It did not require any foresight on my part to predict that it would be a complete failure, because that was perfectly obvious to any man with any perception, and I say the same thing of this amended proposal. It is grotesquely inadequate, it is even irrelevant to the problem and to its special character. There is no conception of how deep, how wide, how dangerous the continuance of chronic unemployment is, and is still more likely to become.

This is the 17th year of unprecedented unemployment; there was no precedent for it before the War. The 17th year! The numbers of the unemployed have ranged between 1,000,000 and nearly 3,000,000. At the moment of greatest prosperity, when there was booming trade, we came down to 1,000,000, and just for a week the figure was slightly under that. In the first depression we reached a maximum of 2,000,000; when we came to our second depression we reached a maximum of very nearly 3,000,000; and for reasons which were given in the very powerful speech delivered by my hon. Friend the Member for Westhoughton (Mr. Rhys Davies), I think Sir William Beveridge is right when he anticipates that the next cycle of depression may put the figure up to the neighbourhood of 4,000,000. There is no indication that anything which has been done by Governments during the whole of those 17 years has made any real impression upon the problem. After half a generation of this obvious evil, this perilous evil which is before our eyes, this is the time when some Government should take it in hand in a way comparable with its magnitude and its seriousness. Up to the present all we have had is one Special Areas Act, three years ago, which has accomplished practically nothing, and this amending Bill, more or less on the same lines, which will not accomplish very much more.

Let us take two facts in connection with these proposals. The area to which the Measure applies covers only about one-fourth of the unemployment. The Special Areas have, I think, about 400,000 unemployed, and that accounts for one-fourth of the total unemployment. That means that this Measure does not deal with three-fourths of the problem. Even if it were a drastic Measure, if it were thorough, if it dealt with the problem inside those areas in a businesslike and effective way, which would remove the evil from those districts, we should still have three-fourths of the problem untouched. Is that the way to solve the problem? I ask anybody on the opposite side of the House what they think of it. Will anyone get up and say, having studied the problem thoroughly, that this Measure will in his opinion dispose of one-half, one-third, one-fourth of the unemployment? Will anyone get up and say that he believes it will find work for one-tenth of the unemployed?

What is the good of bringing a thing like this before the House of Commons as a serious contribution by a great Government, who have an enormous majority behind them, and gigantic resources, of which they have been boasting, and rightly so. The richest country in Europe. The Government have just brought in proposals for spending £1,500,000,000 in five years on arms, and they neglect—neglect—the weakest front if war were declared to-morrow. If all these things were carried out, how much would be spent on food production? The sum of £300,000? Certainly not annually. A sum of £300,000 for the front that nearly broke us in the Great War—and £300,000,000 for the rest. There is no sense of proportion. The Government have no knowledge of the facts. They have no sense of the importance and the responsibility of this huge problem. I do not blame the right hon. Gentleman the Minister of Labour. He has not been long in the Government. He is not yet in that exalted position in which he can hold his own against the great pundits. There sits the Chancellor of the Exchequer. He brought in the first Bill and he is responsible for the second. The right hon. Gentleman the Minister of Labour, now beside him, is only a voice, resonant, trumpet-like, but only a voice. The Chancellor of the Exchequer is responsible for this proposal and I am glad that he is to get up and defend it if he can.

Take the distressed areas themselves, and the one that I know best. I have visited some of the others, but the one that I know best is the South Wales area. I knew it in the days of abounding prosperity; I have seen it in its desolation. I wish that Members of the House before voting on a thing like this would do what they do when there is a great naval review. I wish that the Government would just take them in special trains to pass through these areas. Then, how many of them would vote for this? It is to their credit when I say that I do not believe one would do it. The other day there was a statement made by Sir Percy Watkins, an old civil servant who is now Secretary of the Welsh Department of the National Council of Social Service. That is not a Labour organisation; it is quite an independent body, and there you have people of every party. He made a speech at a First of March dinner, at a national celebration at which attention is called to all the glories of the race, and to its great characteristics. He said that the one outstanding characteristic of Wales for the last 35 years was the unexampled distress and unemployment amongst its people. Will the Government consider these words of his? How many people realised that the unemployed of South Wales and their families represented in the aggregate a total population considerably in excess of the whole combined population of the six counties of North Wales? There was a staggering thought. It staggers everyone except those who are entrenched on the Treasury bench. It shocks everyone who knows the facts and thinks about them. I wonder how soon it will shock public opinion to such an extent that public opinion will say: "Something has got to be done, and if it is not done by this Government then we must find someone behind who will do it." I am told that rearmament is going to make a contribution. I know enough about the Rules of the House to know that I cannot express any opinion about those proposals, and I shall deal with them only in so far as they bear on the finding of employment. But at best it is a temporary expedient. You have it in Germany, you have it in France, you have it in Italy. Those countries are finding work by the production of huge armaments. One day they must stop; they simply cannot go on. Then they will be confronted with a great crisis.

It is a bad thing in itself, that nations should work up an artificial prosperity, even for a short time, by expedients that menace lives and civilisation and threaten the human race with the greatest calamity that can befall it. But you must look forward to the time when every nation will have to stop this borrowing and spending untold millions upon what Mr. Disraeli called, "These bloated armaments". This febrile and hysterical armaments race will come to an end because the nations cannot bear it. How soon will it come to an end? The sooner it comes to an end the greater will be the success of your proposals; the greater the success of your proposals the sooner it will come to an end. You say you are doing this in order to show that you are not going to be beaten, that if that kind of business goes on this country is ready. If it is going to be effective this armaments race will come to an end soon. Nations will get frightened, nations will get exhausted and cry "Halt." When? You have put a limit of five years. I hope to God it will come before then. And so do you.

Here you are talking about having a conference. You cannot rule out disarmament. You may find readier ears than you imagine. Are you ready for what is to happen then? What are your plans? There was a very remarkable article in "The Times". It is not often I find in "The Times" material which I can commend, and it is still more rarely that they can find anything in my utterances that they can commend, but this is what the "Times" said quite recently: Work on the armaments programme will last for some time; and the longer it continues the more it will tend to deflect productive and commercial energy into easy and temporary channels, and possibly to cause a withdrawal from markets abroad, temporary in intention, but—since trade is more difficult to recover than to keep—of serious duration. The general welfare of the country requires a proportioning of effort, a survey of the present needs and circumstances of industry, and foresight to prepare for the future. Where is the preparation? Where is the foresight? Does this Bill represent it? Is this the sum-total of the foresight of statesmanship when you start spending .1,500,000,000 on armaments and you have 1,600,000 unemployed? I am amazed at hon. Members that they should not bring pressure to bear upon the Government to get a real contribution to a real problem.

Unemployment is chronic. It is not something that depends upon a cycle. When you have a depression in trade, up it goes to 3,000,000; when you get trade prosperity it goes down to something over 1,000,000. It is chronic—why? The conditions which created it are chronic. My hon. Friend spoke very forcibly and picturesquely in his speech about labour-saving appliances. There is also the phrase, if you like to call it so, "The obsession for self-sufficiency," among the nations of the world. Take the first cause—labour-saving appliances. It is on the increase. You have only to follow what is happening in the coal mines. Some years ago in the coal mines there were very few coal-cutting machines and conveyancers, but now there is a considerable number of them, and that change is going on. In Yorkshire you have many more. You find the same development in every trade. Therefore, that is something which will increase, and which no Government can arrest, or would wish to arrest.

Take the second reason, self-sufficiency, that obsession; there is no sign that the nations for a whole generation will abandon that delusion. The fright created by the War, when they found themselves without the essential means to conduct the War or to feed their people, will have a more powerful influence upon their minds than any apprehension in regard to their export trade. That is something which has been burnt into the very essence of those great countries. I do not anticipate that you will find any effective reaction against that policy for years to come. I should say that any Government which built their programme not upon removing trade barriers—in which direction it is their business to do their best—but who built their anticipations upon the hope of succeeding in that direction soon, are deluded. It is better that we should face the facts.

I am going to ask the Government again, what is their plan? Have they really any plan for dealing with this chronic evil, one of the greatest social and economic evils of the day? It might be said to me: "Have you any?"

Mr. MacLaren

Hear, hear.

Mr. Lloyd George

Well, I am going to answer that question, so far as I can. We cannot contemplate a continuation for another 17 years of an evil that will stabilise our unemployment problem at a minimum of 1,000,000 and a maximum of 4,000,000. It just happens that the Government themselves have in their possession two documents, signed by members of their administration and recommending, at any rate, one proposal to deal with the problem. I am not going to refer to the recommendations about electricity and roads and the rest, but will confine myself to the one proposal. The problem of the distressed areas first seemed to come to the attention of the Government the best part of four years ago. Then, under pressure in the House of Commons, they appointed Commissioners to examine the problem. Among their chief Commissioners were two Members of the Government. One was the Chancellor of the Duchy of Lancaster. The other was the present Secretary to the Department of Overseas Trade. He went to Durham, but no notice was taken of his remarkable report. When I saw it I was full of joy. I said: "At last we have a Minister who is none the worse for being young"—because when we get old our arteries get hardened and we cannot respond in the same way to new ideas. This is what that young Minister said: No comprehensive survey of the condition of the Durham coalfield can avoid the conclusion that the ultimate destiny of a large part of the county, now industrialised, must be to return to agriculture. Take the next sentence, which is still more striking: It becomes more than ever apparent that, unless the land can be made to support a larger population, many of those who would normally have been attached to the coal mining industry will be condemned to a permanent state of pauperisation. Those words of the Minister have been often quoted. He is one of the few who has said something that is really sensible about a great problem. He added: There is, therefore, ample scope for a more intensive use of the existing agricultural land. The Chancellor of the Duchy of Lancaster said practically the same thing in the West. He said that, in his judgment, hope lay in the same direction. So did the Commissioner for Scotland and, I think, to a certain extent, the Commissioner for South Wales also. What has been done about that? The recommendation has been practically ignored. What has been done up to the present in that direction is very excellent. I went down to see one of the experiments in South Wales which is a very successful experiment, and worth visiting, but there are not more than 100 or 200 people there despite the sum of money which has been spent.

Mr. A. Jenkins

There are only 60.

Mr. Lloyd George

There you are; there are only 60 there at present. I should have thought, after all the money that has been spent, that something more generous would have resulted. I saw from some calculation that you would not get 700 people on the land altogether, under these proposals, including afforestation, drainage and everything. What is the good of that? To deal with this problem on these lines answers two purposes. The first is the finding of employment for people who, according to the words of the Minister, unless you provide this kind of work for them have nothing in front of them but pauperisation. What is the second? You cannot go on spending money merely to find work. There must be some ulterior, national advantage or benefit which has something to do either with the trade or the industry of the country, or with its health and security. That brings me to the second purpose: it helps to solve one of the most important problems of national defence—the increase of food production. I hope the House will bear with me for a minute while I deal with these two problems. First, as regards employment, contrast what is happening in this country with what is happening in many other countries in the world as regards employment on the land. In Germany, how many people do you think are working on the land? Ten million.

Mr. Ellis Smith

Under what conditions?

Mr. Lloyd George

I am coming to that. I have probably spent more years studying this question than my hon. Friend has minutes. I shall be dealing with that very problem in a moment or two.

Mr. Smith

We have read about it.

Mr. Lloyd George

How many people have we on the land? About 1,000,000. Someone may say—and this is what I was coming to: "Yes, but you cannot have the same conditions here that you have in Germany." I have that on my notes. It is quite right; you could not have the same conditions with regard to high tariffs; you could not have the same conditions with regard to wages; hut there is a great gap between 1,000,000 and 10,000,000. Take the countries where there are no high tariffs and where the conditions are good. Holland, where there are no high tariffs on food, has a happy, prosperous peasant community; in Denmark, where the conditions are similar, they have four times the percentage on the land that we have here. What is the proportion on the land here? A few years ago, before the War, we had 7 per cent. of our population on the soil. That proportion has gone down, and down, and down, and land has gone out of cultivation. Herr Hitler said to me, "There is no comparison between your land and ours." That is true. We were under the impression, from figures given to us, that since 1921 over 200,000 agricultural workers had left the soil. We have discovered since that that is an under-estimate. There are reasons why it is an under-estimate. One is because there was no insurance. We knew exactly how many people were working in any other industry, but we had no means of checking the number in agriculture. When you come to a census, the man who is out of work will put his job down as "agricultural labourer," whether he is in a job or not—

Sir Joseph Lamb

Did not the Corn Production Act send more people off the land than anything else?

Mr. Lloyd George

My hon. Friend might just look up his facts; it will do him no harm. I am quoting the reduction that has taken place since 1921, and most of that reduction has taken place in recent years. The hon. Member's friends have been in office for I do not know how many years since then—the country knows it—and they put back the Corn Production Act, but it has not sent up the population on the soil. Anyone who takes the trouble to investigate the facts will find that 35,000 more went off last year.

Sir. J. Lamb

The consequences still remain.

Mr. Lloyd George

Let my hon. Friend take what comfort he can from his interruption. All I know is that he and his friends put back the subsidy on wheat, and still there has been a steady drop. I could give reasons for that. One is that there is not very much labour in wheat—I know, because I have tried it myself—as compared with other crops. Since you have had the Insurance Act, you find that the number of labourers has gone down to 600,000. You were under the impression that it was over 700,000, but it is only 600,000. What does that mean? It means that, whereas before the War there were 7 per cent. of our population on the land, as against 20 per cent. in Belgium, 25 per cent. in Holland, and 30 per cent. in Germany, our percentage on the land has now gone down to 4.6, and it is still going down. Good trade or bad trade makes no difference; the numbers on the soil continue to go down. And, as a matter of fact, insurance is going to drive more away. I am not arguing against insurance, but it means that farmers who kept people on the land, especially people who had been there for a great many years, because they, could not drive them on to the road, now that they know that there is provision for them will have less compunction in dispensing with labour.

Let us look at the position from the other point of view, that of the contribution to national defence. We are providing £1,500,000,000 to increase our defences, in view of the menace of a great war, but the front where we nearly broke down was the food front. It was food shortage that broke down Germany, Austria, Bulgaria, and Russia as well. I could give the facts, but I do not want to take up the time of the House. It very nearly broke us down before they broke down. They stood it for 4½ years; had it not been for our sea communication, we could not have stood it for 18 months. I wonder whether hon. Gentlemen have taken the trouble to see what happened in those grave years. I remember very well Lord Selborne, who was Minister of Agriculture in the Asquith Coalition, at the beginning of 1916 sending in a memorandum to the Cabinet calling attention to the very alarming food position. That was in 1916, and he used these words. He said that, unless something were done to increase food production, we might be forced to make peace on unsatisfactory terms. That was before the intensified submarine campaign began. When that began, there were other Ministers who were predicting that we could not go on for many more months, and the conditions were such as to justify the greatest alarm.

I remember very well the news that used to come in saying that many more food ships had been sunk. Our ships sank by millions of tons. The Admiralty said they could find no means of stopping it. It was a gamble whether Germany or Great Britain would be starved first. We had just a few weeks' wheat in the country. Luckily we found some means to counteract the attack made upon us, but, suppose the Germans had realised in time the power of the submarine and built a great number of them, what would have happened? What are we doing now? We have been thinking in terms of war, of a great war that necessitates the expenditure of £1,500,000,000 to prepare for it. What are we going to do about the most dangerous front? The next time there is a war—and you are building on the possibility that there may be; that is the whole justification of your policy—you will have to deal with a bigger and more powerful aeroplane. I am not one of those who believe that aeroplanes will attack our battleships with success—quite the reverse. The battleships are armoured and they are bristling with antiaircraft guns. The food ship is not. She is fragile. She cannot carry a great many guns. Some will get through, but you have to carry oil, timber, iron ore and copper—you must get them all here, and food in addition.

Are you doing anything to meet the most solemn warning that we all had in the War? Quite the reverse. We are less prepared than we were in 1914. Mr. Hollis, who addressed a meeting at the Farmers' Club, said that we have not got our pre-War crops and that 2,000,000 acres have gone out of cultivation and the land has deteriorated. A county expert, a friend of mine, said to me the other day that in his county, one of the home counties, the farmers are concentrating on the best land and practically leaving the rest. That is why you have so many agricultural labourers out of work. I had an inquiry instituted by the Aberystwyth College into land in Wales, by one of the ablest of all the agricultural professors. He has been working at it for 25 years and he knows every square yard of land. It has been neglected, naturally, because everything connected with the soil has been completely neglected by one Government after another. He said there is a rapid deterioration in cultivable land. What are the Government doing about that? I will tell you one thing that impresses me every time I study this problem. When you come to talk about industry, no one includes agriculture. Industry means iron and steel and copper, mines, transport and building, but the greatest industry in the land is never counted as an industry. Someone said to me the other day, rather a learned academic gentleman, "No professor of political economy living has made any study of agriculture." [Interruption.] Name him. Who is he? I have talked with a great many, and whenever I try to call their attention to an agricultural problem, they turn their noses away as if I were asking them to explore a dung-heap.

Suppose you increased the population of the land to 10 per cent., then it would be only half as many as the lowest country in the world. Sacrifices would have to be made. You are making them in defending the country. Why not make them in order to strengthen what was our weakest line of defence in the last War? I am afraid there is nothing to be hoped from the Chancellor of the Exchequer. He will be in an even more important position in a very short time. I know that he, at any rate, has made up his mind, and when he has made up his mind, there is no one else to counter it. He is a very stubborn man. My experience of obstinate men is this. They can never be persuaded, but they can be pushed. He was pushed on the question of armaments, and there he is going down the hill in great strides. Why not do it here? I sometimes think that one of the misfortunes of this country, and of other democratic countries, is that since the War the Government has been in the hands of men—I am including myself—who spent their prime in dealing with pre-War conditions and have never quite picked up the new conditions created or revealed by the War. That is one advantage which the dictatorships of Europe have. They are men who have been brought up under post-War conditions. When you come to agriculture they are making enormous progress. A document issued by the Overseas Trade Department giving what they have done shows that during the time they have been building up these armaments in Germany they have reclaimed 4,000,000 acres of land. Here land is going out of cultivation. I appeal to the Government, but I am afraid the appeal will be in vain. I appeal to hon. Members behind—and they cannot shirk the responsibility—to see that the Government take this urgent problem in hand and deal with it before it is too late.

Captain Harold Balfour

The right hon. Gentleman dealt with the 1,600,000 unemployed and based his case on that. But is it not a fact that some 800,000 are in work nine months or more, 400,000 are in work more than three months and less than six, and that the hard core of unemployment is some 300,000, and therefore that, tragic as the problem is, it is concentrated on that 300,000, and the rest depend on the trade cycle?

Mr. Lloyd George

If the hon. and gallant Member will look into the figures he will find that in the course of the year 5,000,000 persons are out of work. That means that the incomes of 5,000,000 households are diminished, some by short and some by long periods of unemployment. We have a constant figure of 1,600,000 unemployed.

12.58 p.m.

Lieut.-Commander Agnew

Before the right hon. Gentleman began his discursive survey of affairs in general he made a few remarks on the subject we are discussing to-day, that is, the Financial Resolution. The right hon. Gentleman not only has criticised the Resolution today, but two years ago he issued to the nation his particular cure and panacea for all the evils with which this Resolution purports to deal. He called it the New Deal, and the electorate had an opportunity of passing an opinion on it at the General Election in October, 1935, and the proposals contained in the New Deal, although propagated by his Council of Action, did not command the sympathy of the people.

It was inevitable that the Government, when they started measures designed to cure the evils of the Special Areas, should have selected certain large block areas and concentrated their efforts on them. Conducting affairs on such a large scale made it the more easy to make great experiments. The time has come when the experience gained in the Special Areas should, rightly and properly, be extended scientifically to other parts of the country where the conditions are such as to need it. The right hon. Gentleman waved the Resolution in the air this morning as the Government's great effort to cure the Special Areas, but he omitted to refer to the fact—of which, I think, the Committee is well seized—that this Resolution is not the sum total of the Government's efforts in the Special Areas. It is part of the cumulative drive that the Government have made for the last four years. Those who heard my right hon. Friend on Tuesday were informed that the Commissioners were committed to an expenditure of £11,000,000 in those Areas before this Resolution was brought forward.

I want to refer to certain paragraphs in the Resolution, particularly those which extend some of the provisions hitherto reserved for the Special Areas to other districts. One such lies in part of my own constituency, in the old mining town of Redruth. My right hon. Friend will be well aware that representations have come to him from public bodies in that area, as well as from myself, asking for assistance, and when he was at the Ministry of Mines he went there and spoke courageously and frankly to the people of that district. The question now arises, what exactly will qualify an area for certification? My right hon. Friend laid down three conditions. He said that unemployment must be heavy and prolonged. He does not need me to tell him that in the Redruth area unemployment among the male population was over 50 per cent. in 1931, and that even after the partial revival in the tin mining industry it is to-day over 35 per cent.

Certainly unemployment there is prolonged. Over 60 per cent. have been unemployed for six months, and 40 per cent. have had no work for two years or more. One of the conditions laid down is that there is no immediate likelihood of a substantial increase in employment unless financial assistance is given to the area. Although there has been some diminution in unemployment in Redruth, I want the right hon. Gentleman to bear in mind two facts. In 1931, when there were 1,600 men employed in the Cornish tin mining industry, there were 425 unemployed in Redruth. When the numbers in employment had risen to over 1,800, the diminution in Redruth was under 400. In other words, the revival is not going to remove in the near future the plight of the people in that district. It is true that the price of tin has risen to what may be called speculative heights, but I doubt whether the movements that have been taking place lately on the metal markets are really such as to attract the right kind of man with capital to engage in the initial expenditure of deep-shaft mining in Cornwall. Therefore, I want to press on my right hon. Friend most strongly the claims of the Redruth area to be one of the certified areas under the Bill.

I should like to ask him one or two questions in general with regard to site companies. How is the formation of a site-company to be brought about? Will it have to rest, in the first place, upon the initiative of the local people in the area? Will it be a question of one person or several persons with the requisite 75 per cent. of capital saying "We are anxious to start a site company. To whom shall we write at Whitehall in order to get the remaining 25 per cent, grant? "What exactly will the procedure be? Suppose a site company is formed and receives the grant. Who, in a small certified area such as, for instance, Redruth in my constituency would be, detached and surrounded as it is almost entirely by agricultural land, will be the agent, and through whom will the authorities under the Bill act in administering their proposals?

There is one comment I should like to make. It appears to me that in paragraph (d) when it comes to a question of making loans to enterprises in a certified area, such loans cannot be made to existing enterprises but only to enterprises which have been fathered under the aegis of a site company. I hope that the proposals are not too inflexible in that respect for adjustments to be made where local conditions justify them.

Mr. MacLaren

Will the hon. and gallant Gentleman say exactly what he means by local conditions and the making of the proposals more flexible?

Lieut.-Commander Agnew

I am not a lawyer and I cannot interpret closely and legally the exact scope of the Financial Resolution. I am hoping that it will be found to be such that the Ministry of Labour, or whichever authority administers the proposals in detail, will be able to make such variations to assist an existing industry which is depressed and is the main industry in a certified area.

Mr. MacLaren

Was not the hon. and gallant Gentleman specifically referring to the site company, and did he not say to the Minister that he hoped he would make his rule flexible so that other companies could obtain some of this help? Was not that his point?

Lieut.-Commander Agnew

No, that was not my point at all. My point was that the medium of assistance need not, of necessity be a site company, but my right hon. Friend will doubtless clear up that point when he makes his reply. I call to mind what the Chancellor of the Exchequer said about three years ago when introducing his Budget. In speaking of the general proposals of the Government for a revival of trade and industry and prosperity and employment in this country, he said that the policy of the Government was to keep pegging away. I believe that that policy has been amply justified by the experience which has been gained in the last three or four years, and indeed by the fresh and further implementation of it contained in the scope of the Financial Resolution. I believe that there will be in general a snowball effect of the Bill founded on the Resolution, and that we shall see further and real assistance coming to the distressed and Special Areas of this country.

1.10 p.m.

Mr. E. Smith

I am sorry that the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) has left the House, as I should certainly have dealt with one or two of the questions with which he dealt, having followed very closely the development of the conditions of which he was speaking. Although he has the advantage of having seen for himself, I have also read about them very closely, not only in our own publications, but also in the columns of the most reliable newspapers in this country. I hope that the people of this country as a whole will not stand for the conditions which he seems to believe have gone a long way towards dealing with the unemployment problem in Germany. He made a remark about having spent a long time in considering this question. He cannot help being old, and I cannot help being young, but probably if an analysis were made of the time spent in considering this question, relatively speaking, he would find that I have spent as long on the question as he has, only with this difference. I come from the class that has suffered from the effects of the problem with which he was dealing, and, in addition, I have also spent 25 years in the workshop and have had the experience of having to sign on at the employment exchange. It is only by experience of that character that one can do justice to a question of this kind.

I want to spend a few moments in dealing with the Report of the Minister, on the first page of which he says: In order that a proper picture may be obtained. I want to present another picture. We are dealing with Special Areas, and also with the Report of the Minister and the Financial Resolution. There are a large number of small districts in this country which appear to have been forgotten by most Members of Parliament, and by the Minister in particular. I want to speak on behalf of a large number of very small urban districts. As a result of not being well organised and not presenting a problem to the country on a large scale like South Wales, Durham and parts of Scotland, the people living in these districts have a growing feeling that they have been forgotten. The districts to which I refer in particular are small urban districts like Kidsgrove, Audley, Bidulph, Adderley Green and parts of Stoke Fenton and Longton.

These people live in isolated areas, and mainly obtain their livelihood by working in the mines. As a result of the pits being no longer an economic proposition under the present arrangements of the mining industry of the country, they are now closed. In the small urban district of Kidsgrove, the percentage of unemployment is 49.9 at the present time, and the same thing applies more or less in Audley and in Bidulph. This represents a tragedy. The other Sunday I went to speak at a Brotherhood meeting in one of these small, isolated places, and after speaking there one or two of the prominent officials took me into parts of these districts, and into the homes of these people. They are fine people. They and their forefathers have toiled for generations in the mines, but in the Kidsgrove district every pit is now closed down owing to the concentration of mining production in better mines. I am not speaking critically of the colliery proprietors in regard to this matter. As individuals they are not different from the individuals carrying on in other sections of industry. They are victims of social forces over which neither they nor I have any control. I am pleading for this: Seeing that the country is not prepared to accept our political philosophy or policy, the least that the country ought to be prepared to do is to see that these men and women, who are suffering through no fault of their own, should not be left isolated as they are at the present time, to manage on a mere pittance.

The women and children are innocent victims of these conditions. What would happen if they were on a ship which was wrecked in the North Sea or the Irish Sea? A lifeboat would go immediately to their assistance, in order to save them. The same thing would happen if there were a fire in the district. This morning, two fire engines went past the house where I live, and I thought how fine that service was. If there were a fire at a large house in Hyde Park, the fire engines would go to the fire in order to safe life and property, and to render the best possible service. If there were a fire in the poorest house in the East End, where the poorest men, women and children live, the fire engines would go to their assistance, in order to save the lives of the people, and to save their furniture and the house, just as quickly as the fire engines would go to the largest house in Hyde Park. If it be right that that principle should be applied in regard to the saving of lives in a shipwreck and lives and property in a fire, it surely is right that, seeing that production has been increased to such a great extent, the victims of increased production and the victims of unemployment, through no fault of their own, should be rendered the same assistance that is rendered by the lifeboat and the fire brigade to people who are in distress through other circumstances.

The working classes in this country have been betrayed time after time. Governments have been elected on their policy, but as soon as the Government have obtained power, they have betrayed their promises. In the same way individuals are betraying their promises right through the world. It is suggested that we ought to adopt methods similar to those adopted in Germany, but let us remember that in that country they snatch the young boys and girls from their parents and send them into concentration camps. In this country, although we are critical of the Government, we have our democratic rights. We are still able to stand up on behalf of thousands of men and women who need assistance. We still have the right to plead with the country to support us, and we still have the right to plead with the Government. We are able to do that because of the sacrifices made by men and women for the past 200 years. Because of their sacrifices we are able to speak in this House and to plead that men, women and children should not be treated in the way they are being treated. I would plead with the young men on the benches opposite that they should rise in their indignation and demand that, just as the Government are dealing in such a lavish way with the provision for the defences of the country, they should deal generously with the provision for the defence of the people against unemployment and all its attendant evils, and that the Government should go to their assistance in the same way that the lifeboats and the fire brigades go to the aid of the people who are in need of help.

1.21 p.m.

Mr. Pickthorn

The very little that I have to say will be said in an endeavour to make plain a question that I wish to ask. I am not sure that I understand sufficiently the technicalities of the relations between the principal Act, the S.A.R.A. Act and the Resolution, to be confident that I am entitled to put the question. My excuse is some slight knowledge of, and some private obligation to, South Wales, and the fact that although I am no economist I come from a place where economists are very thick on the ground, and there it is fairly easy to get their opinions or, at least, to correct one's own untutored impulses.

Mr. MacLaren

We have to suffer from your students on the front bench.

Mr. Pickthorn

I did not catch the gist of the interruption. The Minister of Labour on Tuesday made it clear that he thought South Wales was the most urgent and most difficult part of the problem, and if in what he said about the geography and history of that country he did not explicitly say that the reason for that difficulty and the only way of dealing with it was the relation of the valleys to the coast, if he did not explicitly say that, it was necessarily implied in what he did say: and a reinforcement of that argument, to use short-range mobility down the valleys, came from the hon. Member for Darlington (Mr. Peat), who argued that socially as well as geographically short-range mobility is the thing that matters most immediately, because the middle-aged man, probably with a wife and family, could be most hopefully dealt with in that way.

I think the economists agree that long-range transference has proved a great difficulty and short-range mobility has, on the whole, been surprisingly easy, not too easy, but much easier than had been led to expect. The South Wales area for this purpose has not the advantage which, for instance, the north east coast has, of containing patches where things are on the up-grade. Therefore, using short-range mobility becomes more difficult in South Wales than it otherwise would be, but with communications as they are in South Wales, and especially as they might be developed, there is no doubt that a great deal of mobility of this sort could be made available.

I do not know whether hon. Members have seen the second survey by the University of Wales, which has just been published, but in that survey it is made clear that there is a great deal of mobility of that sort. A considerable number of people work at places 10 miles distant from where they live. That state of things is on the increase, more or less; and the survey makes it clear that though in parts of the tops of the valleys, only in comparatively small cases, there is hope of doing anything considerable, but that the main hope for those regions must be in shifting labour down towards the coast. The question that I want to ask is this. It does not seem clear from the White Paper or from what was said on Tuesday whether the coast areas can qualify for financial and other assistance under the proposed Measure as one-industry area subject to severe unemployment, or how much can be done under it towards providing employment, for instance, in Cardiff, Swansea, Burry Port and so on for people who are at present unemployed in the valleys.

The Minister said: The Commissioner under the present Act has power to do things outside the boundary of the Special Areas, providing they will bring results in employment inside the boundaries of the Act."—[OFFICIAL REPORT, 9th March, 1937; col. 1018, Vol. 321.] That seems to me to contain a whole series of ambiguities. Possibly if I understood sufficiently the technique of the thing as it has already been worked, it would not be so ambiguous. What I want to know mainly is whether the powers and finances under this Resolution may be used towards the finding of employment on or near the coast for people who live up in the valleys. Can they be used if the people come down, or can they be used if they continue to sleep ten or fifteen miles up the valleys, or can they be used in both cases?

1.27 p.m.

Mr. Owen Evans

As a South Wales Member, I would like to express my gratitude to the hon. Member for Cambridge University (Mr. Pickthoni) for the special attention he has given to the problem of South Wales. I intend to keep strictly to my promise and to be brief in my remarks, and consequently it will be impossible for me to cover all the ground I would like to cover. I wish to refer to a matter about which I may claim to have some knowledge and experience in various parts of the country, and particularly in South Wales. I can give an example, I think, of what still amounts to a new industry in South Wales, although it has now existed for some years, and that example goes to show that at any rate South Wales is able to take in new industries and provide the necessary skilled labour to work in those industries. At one time an industry such as the one with which I have the privilege of being connected was unknown in this country and unknown in South Wales, at any rate since the great metallurgical days when copper figured so prominently in the Swansea area. There is in South Wales, however, that great tradition which still exists and which could be made use of in introducing new industries to that area. Some of the pioneers in the copper, tinplate and steel industries in America have to a very large extent gravitated there from South Wales. It is to the experience of South Wales that the copper industry in America is indebted. I am referring to this in order to show the Government that they still have a great deal to do in this matter which has not yet been done. The suitability of South Wales, the flexibility and adaptability of labour there are such that they ought to be inducements to new industries to go to that area.

I would like to pay a tribute to the local authorities in South Wales in this connection. They have really been remarkable in their enthusiasm and their buoyancy in spite of very great discouragement. I know of instances where they have been extremely active in bringing to the notice of the industrialists up and down the country the advantages of their districts in order to induce them to go there. The Government ought to be deeply grateful to the municipal author- ities in South Wales for the activity and the ability which they have shown in assisting the Government in their programme of introducing new industries to the Special Areas. If the Government had a little of the enthusiam of the local authorities in this respect, a great deal more could be done.

This Resolution can have no other object than to create further employment which would be a profit not only to the workers, but to the employers and the industry itself. We all realise that it is of no use endeavouring to establish new industries in the Special Areas unless they have a real hope of being successful from an earning standpoint. They must be of an earning capacity. There are three types of new industries which might be established in the Special Areas. First, there are those that are already established in some other part of the country and may be further extended, although, of course, that would not of necessity create further employment. Secondly, there are those industries which are active already in foreign countries, but which for some reason have not yet been established in this country. We had an example only a night or two ago of calcium carbide, and another instance is ferro-chrome. There are many industries, electro-chemical in character, which are not established in this country. Thirdly, there are potential new industries. In this connection, a document was submitted privately to the Government not long ago. These potential new industries are the results of new inventions, and there have been numerous examples in recent years. I would like to ask the Government whether they have acted on the suggestion which has been put to them on many occasions and have made a real survey of possible new industries which might be established somewhere in this country. The other evening the Noble Lord the Member for Aldershot (Viscount Wolmer) put forward that suggestion as though it were something new, but as it has been put forward on so many occasions, it is somewhat heartbreaking to find that nothing seems to happen.

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

Does the hon. Member mean the establishment of new industries in this country as a whole to make goods that are at present imported from abroad?

Mr. Evans

That is one of the three types of new industries which were described in the document submitted to the Government some time ago. In my opinion and in the opinion of many people outside the House, the action of the Government in this matter is amazing. I will quote a passage from the "Times" and in doing so I ask the Government whether that represents their attitude towards the establishment of industries, such as the calcium carbide industry and the ferro-chrome industry? The "Times," referring to the Caledonian Bill, says: Ten Ministers voted for the Second reading, but none voted against it as a result of the Cabinet decision that while Ministers might support the Bill if they so desired those who were opposed to it must abstain. That is an extraordinary thing for the Government to do, instead of coming down to the House of Commons and taking the responsibility for the matter. Apparently, the suggestion is that behind the scenes, those who wanted to vote for the Bill were told they could do so, and those who did not want to vote for the Bill were asked to abstain from voting altogether. Is that true or not? It is an extremely serious matter. The hon. Member for East Aberdeen (Mr. Boothby) in a letter to the "Times" to-day refers to a particular company and to an implied threat that because of the action of the House of Commons negotiations are in progress for establishing that industry in Norway. Everybody knows that that industry is already in Norway and that we are importing practically all our calcium carbide needs from Norway already.

We know, and the Government know, that the fact that that Bill was before the House of Commons kept other people from going forward with this matter until they knew what the result was going to be. There are companies which are now considering the question of the manufacture of articles such as calcium carbide and ferro-crome. I happen to know, and the Government must know, that there are people discussing these matters and prepared to consider proposals, and I am glad to say that there are hopes of industries similar to that with which I am connected being established in South Wales in the near future. What I implore the Government to do, instead of showing mere passivity in the matter, is to show some activity in planning and directing and publishing a complete survey of what special industries can be established in this country. I ask them to consider the offer of further inducements to firms to go into the Special Areas and undertake the manufacture of commodities such as I have indicated.

Much has been said about the conditions of labour and the distress in South Wales. I have had the opportunity of visiting those districts and of studying the conditions. I am satisfied that suitable sites and conditions for these new industries exist there. The Government themselves ought to ascertain the position in that respect. A few nights ago there was a concert here in London with which I had something to do. Eight unemployed men came from Wales to London for that occasion, in order to support the workers' settlement. Two of these men stayed with friends of mine. One was the father of six young children and when he came downstairs in the house where he was staying, he was amazed at the breakfast laid before him. He was almost afraid to eat lest he might be ill. He was unaccustomed to so much food. He explained that the first consideration in his own home was to see that the children got something before they went to school and when they came home. The parents in that home only got two meals, one at eleven o'clock and the other at four o'clock. That is a disgusting situation to exist in a country which is supposed to be leading the world in prosperity and which is, at the present time, engaged in a "Keep fit" campaign.

1.40 p.m.

Sir Henry Fildes

I regret that the hon. Member for Westhoughton (Mr. Rhys Davies) is not in his place, because as one who has worked in Lancashire for 53 years and lived there for nearly 70 years, I desire to reply to certain statements which he made earlier. I wish, in the first place, to protest against the implication that a responsible Member of this House had intervened in some unfair fashion in order to get a preference for his own constituency in connection with the placing of a factory there. I also protest against the still more unpleasant suggestion which was made that the offices of the Ministry of Labour in that constituency had been moved from some religious institution to a Conservative club. It is, perhaps, not an unusual thing to find dry-rot in a Wesleyan or Methodist chapel and in this case the fact is that the premises formerly occupied were entirely unfitted for the purpose, and anybody who knows Chorley at all knows that there is only one building there which is suitable. It is not a club. It is a dance room, and it has a considerable capacity, and in a moment of emergency the offices of the Ministry of Labour were moved there. I deprecate strongly the bandying about between Members of suggestions of that description, and I enter my protest against it.

There is one other point which I would like to mention. I seconded the Address to the Crown in this House in 1920, and I have watched the proceedings of various Governments since. I remember what happened in 1929 and 1931. Then we had the spectacle of the right hon. Gentlemen the Member for Carnarvon Boroughs (Mr. Lloyd George)—and hon. Members can confirm what I say by turning up the OFFICIAL REPORTS of the period—making eloquent appeals to the Labour party, then in office, to get something done to deal with this question. We did not hear the hon. Member for Westhoughton and his friends responding to those appeals. They sat on these Benches like dumb dogs. I remember the protest made by Sir Oswald Mosley against the inactivity of the Labour party when it was in office. It is, I claim, a fair comment to make that when the party of hon. Members opposite was in office they did not respond to these appeals. Even though they had not the power, hon. Members themselves could have protested against the fact that when the party was in office nothing was done.

To return to the complaint of the hon. Member for Westhoughton about the placing of this factory in Chorley, I do not know in view of later events that Chorley was the wisest choice. Within a few miles of that area a well-known firm of multiple shop tailors has opened a factory, employing 2,000 people which is, of course, in a measure relieving unemployment there. But taking it all in all, as a centre Chorley was, by reason of site and accessibility to unemployed workers a sound place for a factory, and the Government were justified on those grounds in contemplating the placing of the factory there. I have not the slightest doubt that if the hon. Member for Westhoughton would repeat outside the statement that in his opinion a Member of this House had been instrumental in getting a preference for his constituency merely on political grounds, he would be accommodated with a very interesting libel action. I had intended to deal with other points, but I know that other Members are anxious to speak and I will not detain the House longer. I have made my protest in the name of Lancashire—

Mr. Westwood

And the interest of distressed areas?

Sir H. Fildes

And in the interests of the distressed areas of which I know a great deal, and, having done so, I give way to others.

1.45 p.m.

Mr. Westwood

Having listened to the speech of the hon. Member for Guildford (Sir J. Jarvis), I would like to ask the Committee to get back to the Resolution which is before it. There are four enabling sections in the Resolution, and we on this side claim without hesitation that the Government's proposals, as contained in this Resolution, are hopelessly inadequate and cannot possibly deal effectively with the problems that we are discussing. I want to direct my main argument against the Motion because of its inadequacy to deal with the problems of unemployment as they affect Scotland and the Scottish people. No one has given more sympathy and support in this House to those who have been pleading the cause of, and fighting and voting for, the depressed areas, either in Wales or in the North of England, and I claim that the country from which I come is just as much a depressed area as any area in Great Britain. Indeed the problem is even greater there than in many of the other areas that have been discussed during this two days' debate.

The heavy deadweight of unemployment stiil remaining in Scotland leaves us altogether dissatisfied with any works with which the Government are attempting to deal with the problem. In comparison with the South-Eastern and Midland districts of England, the figures of the registered unemployed in Scotland prove that Scotland is in a far worse position than these other areas. The situation of the Special Areas has failed to respond up to the moment in any marked degree to the efforts that have been attempted by this and the preceding Government. In some of these areas the unemployment figures are abnormally heavy, and even areas that are not scheduled as special areas have very high percentages of unemployment. Wick and Montrose, for example, have for some time returned percentages as high as 36.7 and 32.7 respectively.

The problem of unemployment, as I see it, takes a very serious aspect so far as Scotland is concerned. I have spent 28 years of my life in administration in Scotland, and particularly in dealing with the problems affecting youth and education, and one of the most serious problems of unemployment in Scotland lies in this very important fact, that the incidence of unemployment, whether in Scotland generally or in the scheduled Special Areas, on the younger age-groups is more serious there than in any other part of Great Britain. On the figures for November last, about 40 per cent. of the men unemployed in Great Britain were in the age-group 18 to 34, while for Scotland alone the proportion exceeded 47 per cent. The fact that Scotland has still a greater leeway to make up is demonstrated by further evidence, including the absence of appreciable progress in agriculture and also in fishing.

There is another aspect of the unemployment problem as it affects Scotland. Special reference was made by the Secretary of State for Scotland to the fact that by the new formula to be applied in the distribution of the block grant in Scotland, assistance was to be provided by the Government in dealing with the problems of the Special Areas. The effect of unemployment on the cost of poor relief has occasioned grave concern among local authorities, because, although we are going to get some assistance from the block grant, the rising figures of those who are compelled to apply, because of poverty, for public assistance, will eat into any of the advantages given by the additional money that has been provided for the local authorities in Scotland. I think it was the Secretary of State who raised the question of the advantages given to Scotland by the new block-grant formula and the new money that has come to Scotland. May I remind him of the fact that it has been because of the generosity of some of the more favourably placed areas in Scotland that these additional benefits have gone to the depressed areas?

I had the good fortune to be the representative of one of the three negotiating bodies dealing with the new formula and the new block grant. For 10 years I had the responsibility, as a member of the executive of the education authorities and of its Finance Committee, of negotiating and carrying through the arrangements for the distribution of the Education Fund for Scotland, and it is to the credit of Scottish representatives, drawn from all parts of Scotland, that we always recognised that there was one area in particular which was more depressed than any other and that we were willing to share what we had with them out of our block grant. I refer to the crofting counties of Scotland, and we did it for 10 years. In the negotiations regarding the block grant, although the area that I represent is only getting a benefit of approximately 5d. in the £ on the rates, and the town of which I am an administrator is only getting a benefit of approximately 4½d. in the £ on the rates, I, as representing one of those negotiating bodies, willingly accepted the new arrangement that would actually provide reductions in the rates as high as 3s. 3d. in the £ so far as the crofting counties were concerned. It is scarcely fair for the Secretary of State for Scotland to claim credit to the Government for what they are providing for the depressed areas when this is being provided mainly as a result of the generosity of those better-equipped areas which are willing to make sacrifices in the interests of the poorer communities in Scotland.

In June, 1936, the number of persons, including dependants, in receipt of poor relief exceeded 320,000, or 661 per 10,000 of the population, as compared with an average for England and Wales of only 268 per 10,000. In Glasgow alone there were 148,000 persons on relief, equal to 1,363 per 10,000 of its population. This is an indication of the distress in Scotland and we on this side of the House claim that this Resolution will not be able to deal with it effectively. For these reasons we are lodging our objections to the inadequate sum provided and the inadequate provision being made to deal with this great problem. May I make one other reference to the claims of the Secretary of State for Scotland that the improvement in the block grant would materially benefit the local authorities, particularly in the distressed areas in Scotland? The right hon. Gentleman seems to forget that his Department are making ever-increasing demands on the local authorities for expenditure, and if we are to carry through the work in the interests of our people, and to respond to the appeals that are being made to us, it undoubtedly means further expenditure by the local authorities. That will take away any advantage that may have been provided by the additional money given to us under the new formula in the block grant system.

I will make one or two suggestions which, I hope, will receive serious consideration. We are setting up a Committee to study the allocation of industry, an Executive Committee for South-West Durham, and other bodies of that kind. May I ask the Government to consider the setting up of a transport inquiry committee to report on the best and most economical methods of transport for the products of many of our light industries? I am anxious that areas that cannot be described as derelict or in existing conditions, as Special Areas, shall not be in the unhappy position of being made distressed areas because they are not organising rightly or doing what is right in connection with transport. Why should there be this wild scramble for traffic as between the railways and the road traffic industry? I am not pleading for either. I am pleading for what is best in the interests of the country. If the railways are best for the transport of certain commodities, they ought to be used and there ought to be no competition from road transport. If road transport is best, there ought to be no competition from railways. I make this suggestion in the interests of the light castings industries that I have in mind.

We have been debating during the last few weeks problems of Defence, and a Resolution has been passed through the House to authorise the borrowing of £400,000,000 to enable us to defend our shores. If, however, the war does not come, as has been pointed out by the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George)—and every Member of the House and every member of the public honestly desires and earnestly prays that the need for the use of these Defence weapons will never arise—instead of building up for a war that will not take place, surely it would be wiser to spend a little more money on the war that is already taking place in our derelict and distressed areas. That expenditure on munitions of war for a war which will not take place was best summed up by a music hall star, George Robey, who, referring to the fact that we are too "broke" or too poor to spend money on other things but not so far "broke" that we cannot spend money on defence, saying: To round off a joke They say they're all broke; Yet for armaments millions they've raised. If it's just to take part In a war that won't start, I'm more than surprised—I'm amazed. I am not only surprised, but amazed at the inadequate proposals now before us to deal with the tragic problem that we are discussing. We are disgusted with the ineptitude and apparent inability of the Government to realise the problem which faces them. The Government are providing for the expenditure of £1,500,000,000 on a five year plan for armaments, but they provide only £2,000,000 for the Special Areas. I can claim as a Member of the House that I never try to make extravagant claims when I negotiate with or write to Ministers. I always try to be as courteous as possible, and to state the best case I can on behalf of my constituents. I am sure that the Chancellor will not be able to accuse me of having asked for a munitions factory. He never will. It is true that I have had an application for a firm to be considered, but I simply pass on such letters to the Department with no observations. If I am dealing with a case with the Minister of Labour, however, I put in a good plea for my constituent and hope that the Minister will be a little more merciful than usual in that particular case. I do the same when it is a question of pensions, but I have never applied for a munitions factory.

I do not want factories for the production of war material in my constituency nor in the country to which I belong, because they are no solution to the problem of the Special Areas. We were told by the Minister of Labour that Scotland was to get two new explosive factories, an extension of an old one, a petrol tin factory, an extension for the making of armoured plate, and a torpedo factory. If the work on which they are engaged finishes at the end of five years, or because a disarmament conference succeeds, what will the Government do in these districts? To put up such factories is only to temporise. It is making the problem still more difficult to deal with afterwards. Now is the time to look ahead and plan.

May I give one or two facts with regard to the tragic position in Scotland? The eight crofting counties have declined in population since 1861 by 100,000 persons. Nearly 40,000 of this shrinkage occurred between 1921 and 1931. There has been a fall of 28 per cent. in the number of children under 14 who are attending our schools. Unemployment in the real distressed areas of Scotland—the Highland areas— is as high in some districts as 66.7 per cent. I do not make a plea for the development of the crofting system. I have seen it; and I have sat by crofting firesides, and God save any of my children from having to live the life of the crofter in the Highland counties of Scotland. I always find that those who live in the crofts are anxious to see that their children got out of them. That is why Scotland has been blessed with so many good teachers coming from the Highlands. They also get their ministers and their lawyers from there, because no one will live on a croft if he can get away from it, and therefore I shall not argue for an extension of the crofting system; but something will have to be done to provide more smallholdings, and to develop them on scientific lines. We tiave never really started on that job. The miserable £2,000,000 provided here for land can never develop smallholdings in Scotland on scientific lines.

The right hon. Member for Carnarvon Boroughs give figures relating to the land problem in Great Britain and I want to give figures for Scotland. In 1931 there were 4,632,200 acres under grass and crops in Scotland, and in 1936 that figure had been reduced by 39,823 acres. The Labour Government cannot be blamed for that tragedy, because Members on the benches opposite have been in power since 1931. The area of arable land during those years was reduced by 75,935 acres. The number of persons employed on the land in 1931 was 112,468, and by 1936 that had been re- duced by 1,849. Surely the Secretary of State for Scotland could find plenty of scope for his energy in developing smallholdings in Scotland. He might even carry out an experiment in co-operative farming. If it is right to have a trading estate why not try some of these other experiments?

As far as the project for a carbide factory is concerned, after having heard so many Members stake out their claim for that factory I should not be doing my duty as a representative of Scotland if I did not stake out Scotland's claim for it. I am only putting in my claim, and I hope that preconceived ideas in connection with ownership will not keep the Government from facing up to this particular problem. The House turned down a Bill which made application for certain powers in connection with that scheme. A carbide factory is necessary, and the Highlands have got the power, and why cannot the Government try to get an agreement among representatives of all parties in Scotland, particularly in Inverness-shire and Ross-shire, under which power may be generated in that district to work the factory for the making of carbide. It would be doing something effective to cope with the distress in the Highlands, and it would provide a new industry for Scotland.

The Government must reorganise smallholdings throughout Great Britain, must reorganise transport and must build bridges. If we are to develop even these Special Areas in Scotland, why should we have to wait until this rearmament crisis is past? I was amazed at a statement made by the Secretary of State for Scotland that the Special Areas in Scotland were not so much black as grey. I think they are black and blue as the result of the bruises caused by the capitalist system under which we live, and if the Government want to apply a salve to Scotland they must give something more than £2,000,000. The local authorities will help. One of the authorities of which I have the honour of being a member is willing to assist the Government to the extent of a penny in the £ on the rates for the next 30 years, and other authorities will do the same. We should not get all the advantages but we want to help Scotland in dealing with these grey areas, as the Secretary of State calls them. There is plenty of scope for work. The building of the Forth road bridge would provide a national asset, and give speedier transport to some of the almost derelict places on the east coast which want speedier transport facilities for getting their fish to the London market.

We ought also to do things in a big way in developing the production of oil from coal, in the interests both of national defence and of the unemployed. Something must be done also to assist drainage and water schemes. In Tuesday's debate the Secretary of State for Scotland referred to Standburn as a village which had been moved to a new place, and that is good work, but I can tell the Government where they can spend on such work far more money than they are proposing to provide. What about Wanlockhead? I am sorry that the Member for Dumfries (Sir H. Fildes) is not here. All he did in his speech to-day was to defend Chorley, and he forgot the constitutency which he represents. He knows of two villages which could well be lifted bodily, and the people given an opportunity to find employment in the better-off areas. The Government must help in the matter of drainage and water schemes, because there are districts in Scotland in which they could not plan new industries at the present time through lack of water supply and drainage schemes, and the local authorities cannot face up to their responsibilities unless additional grants are provided by the State. The State provides £400,000,000 for defence and only a paltry £2,000,000 to bring industrial activity and hope to the Special Areas. To offer only that small sum is a mockery, it is like putting sticking plaster on a wooden leg or offering pills to cure an earthquake.

Even when we have carried through some of these proposals we shall not have solved the problem. There is only one step, or series of steps, which can be effective—shorter hours, higher pensions, and pensions at a lower age. We must also bring about improvement in the special services. In that way we should be doing something effective to deal with unemployment and with the Special Areas. I trust that as a result of this discussion we shall get from the Government something more than this miserable sum of £2,000,000. The Government proposals are inadequate, grotesque, and unfair to the people concerned, and they cannot possibly solve the problem which I believe every Member wants to solve. Hon. Members opposite are just as anxious as we are to see the problem solved, but until they are prepared to face up to their responsibility—and it is their responsibility, because the power is theirs—we shall still have the derelict areas and the Special Areas, and we shall have to go on pleading with the Government to take a wider view of the problem.

2.15 p.m.

Mr. Chamberlain

The last occasion on which we met to discuss this question of the Special Areas was in November of last year, and I remember that the hon. Member for Stockton-on-Tees (Mr. H. Macmillan), who certainly cannot be accused of being an indulgent critic of the Chancellor, observed that I had made a minor concession, but added that he was much encouraged because he had observed that my performance was always better than my promise. I think I can claim that the speech of my right hon. Friend the Minister of Labour demonstrated that the hon. Member for Stockton-on-Tees was a true prophet, for the story which my right hon. Friend was able to tell certainly indicated an improvement in the situation of the Special Areas owing to measures already taken, and moreover showed how in the proposals which the Government are now bringing forward they had not only implemented the promise which I made on that occasion but had gone substantially beyond it.

On many previous occasions when we have been talking about the Special Areas, hon. Members opposite have complained that the figures of unemployment in those areas showed no improvment whatever and that we still were where we had always been. At any rate they cannot say that any longer. The White Paper shows that in a period of little over two years the figures of unemployment in the Special Areas have been brought down by 120,000, and that even in South Wales itself, probably the most difficult of the areas to deal with, the reduction has been over 20 per cent. [HON. MEMBERS: "Transfers!"] I heard hon. Members opposite say "Transfers." It is quite true that some portion of the 120,000 is due to the fact that a fairly substantial number of people have been transferred from the Special Areas to other areas where they have been able to obtain employment, and have not only obtained employment themselves but in many cases have been encouraged to invite their families to follow their example and make their homes in places which are not being subjected to the difficulties of the Special Areas. I do not know why that should be considered by the right hon. and hon. Gentlemen opposite as a fault.

It would certainly be desirable if everybody who is unemployed in the Special Areas could find employment on the spot, but we all know that that is impossible. At any rate for some time there must remain a large number of people unemployed there whilst other measures are being developed, and in those circumstances, where a man has an opportunity of raising his own standard by finding continuous employment at good wages elsewhere, I cannot understand why hon. Members opposite show any objection to the process. [HON. MEMBERS: "You take the younger ones!"] I quite agree. I have drawn attention to that difficulty. The tendency is for the younger ones to move and for the older ones to remain behind, since it is easier for the younger men to go, but on the whole it seems to me hardly possible to say that, because the transference of the younger people will to some extent make the position of those who remain behind worse, therefore we should stand in the way of those who have opportunities of putting themselves and their families into that improved position.

It is very difficult for right hon. and hon. Gentlemen opposite to take a fair and unprejudiced view in this matter of the depressed areas, about which naturally they feel very strongly. My noble Friend the Member for Aldershot (Viscount Wolmer) on the day when we began this discussion, pointed out that every figure, every piece of evidence which the Minister of Labour brought forward to show that there was an improvement in the Special Areas, was received with every sign of irritation and annoyance by hon. Members opposite, and that when at the end of his observations he gave a list of private factories which were going to be set up in the Special Areas, largely because of the personal efforts of Lord Portal, hon. Members opposite themselves became a depressed area.

The hon. Member for Bishop Auckland (Mr. Dalton) and one or two other hon. Members opposite amused themselves by caricaturing the attitude of the Chancellor of the Exchequer on this subject. Of course the Chancellor of the Exchequer if he is to do his duty must expect to be represented as a hardhearted man, with the strings of his purse very tightly drawn, and as always opposing the more generous sympathy of his colleagues. But the hon. Member for Bishop Auckland described me as a man who from the beginning had taken up a pessimistic and cynical attitude upon the whole subject and as one who had made up his mind that it was quite impossible to do anything to improve the conditions in the Special Areas. [HON. MEMBERS: "Hear, hear!"] Evidently the hon. Member is not alone in that view. What the hon. Member said is not only untrue but the opposite of the truth. I am not in the habit of boasting about my actions, and I am not going to do so now, but I will say, as a matter of simple historical fact, that there is no Minister—I would even say no man—who has worked harder or longer than I have in trying to solve the problems connected with the Special Areas. There is no one who has maintained more persistently the possibility of an ultimate, though not an immediate solution. I have never suggested that there was any single remedy or short cut to a solution to the problem.

There is one thing I do detest in politics, and it is humbug. I have never, therefore, attempted to mislead the public into an expectation that there was any speedy way out of our trouble. I have said from the beginning, and I maintain—events will show that I was right—that while there are many ways of dealing with this problem that one could think of, we shall only solve it by degrees, and steadily progress towards a restoration of normal conditions. I noticed that the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) cheered me just now when I said there was no short cut and no single remedy. At the beginning of his speech the strictures he based upon his particular view of what we are going to do showed that he was treating it as though we had put all our money on this Bill as the sole remedy. He said it was grotesquely inadequate. It would be if it stood alone. But we have evidence which covers many pages of the White Paper and shows that under the general policy we have pursued, taking the whole of it and not picking out one single bit of it, we have been making substantial improvement.

I have stated on several occasions, and it has been my view from the very beginning, before the Commissioners were appointed or the investigators were first asked to look into these conditions, that there were five, and only five, ways in which you could permanently help these areas. We know the conditions that have brought about the fact that they are specially depressed and specially distressed. Broadly speaking, the reason is that they were dependent on one or two of the oldest and most important industries of the country, which became particularly depressed, and remained so when other industries had begun to recover. The first and most obvious way of helping these areas would be if anything could be done to revive those industries. The second way was to try to do something to fill up the gaps and the deficiencies left by the depression of the older industries, by inducing new industries to go there. The third was a way more limited in scope, but still with its importance among the various ways in which we might help people; it was land settlement. The fourth way was transference from these areas to other areas where employment was available. The fifth and last was improvement of the social conditions in the areas for those who were not capable of receiving benefit from any of the other four methods. Those were the five methods which I had in mind for a long time, but, in the course of last year, a sixth way of helping those areas has arisen. It is not in itself a permanent remedy, but it is a very substantial palliative in mitigation of the conditions; it is to be found in the fact that it is the policy of the Government to take advantage of the armaments programme, upon which we have been compelled to embark, to direct as much work as possible arising out of that programme into these areas.

A great deal of nonsense has been talked about the effect of putting this work into the Special Areas. The hon. Member who last spoke repeated what has been said by many other hon. Members, that this was not a permanent form of employment, that presently it would come to an end, and that the position of the areas would be worse than it was before. Surely that is going a bit too far. Why should it be worse than it was before? It will not be a permanent remedy, I quite agree, except in so far as the factories established in any area will be in permanent use, and to that extent it will be a permanent help to the areas; but why anybody should carp at the establishment of this extraordinarily valuable amount of work in these areas when it will employ a great number of people, while other and more permanent remedies are being built up, I cannot understand.

The White Paper states certain figures of the value of the orders already placed in the Special Areas. Those figures must have surprised many hon. Members; £41,000,000 worth of orders in the Special and distressed areas and £24,000,000 worth in the Special Areas themselves. That was the figure up to November. I can give the Committee later figures than that. I have the figures now to the end of February. In that short time, from the end of November to the end of February, the total amount of the orders in both kinds of areas increased from £41,000,000 to £57,000,000 and in the Special Areas from £24,000,000 to £35,000,000. If those orders were being placed in the Special Areas solely for the purpose of giving employment, I could understand there being some force in the objection that they were not permanent but only temporary remedies, and that when they had gone there would be nothing to replace them; but surely it is a great advantage, when you have to place those orders somewhere, to place them where there is a large number of people unemployed and unable to find employment. I do not intend to labour that point any more. Although all of us deplore the necessity of this huge armament programme and may hope and be anxious to do all we can to bring about some sort of general international understanding which will put an end to a race which, I think it can be said, is really utter madness, let us take what we can in the way of satisfaction out of it. If it does enable us to employ a certain number of people in these industries, let us be thankful that something of so substantial a character is a result.

Let us turn to the other methods that we have employed and consider the results that have been achieved. Apart from special features like the armaments programme, the most effective way in which you can help the Special Areas is by improvement in the general prosperity of the country. That is very strikingly exemplified in the case of the older industries of which I spoke. Take for instance, the iron and steel industries. I can remember in 1931 that the industry was almost on the rocks. Confidence had completely gone out of it. Reserves had been exhausted, capital was written down, plant could not be renewed and the foreigner was taking very swiftly trade that had once been in British hands. Now, it is one of the busiest and most prosperous industries in the country. We have been hearing a good deal in the last few days about it being an expanding industry—and it is expanding to-day—indeed it has not been able to expand quickly enough to meet the demand. No doubt that is due to some extent to the exceptional demands that are being made on the steel industry by the armaments programme, not in this country alone, but in all countries which are rearming. All have to draw upon the world pool of steel and iron.

Let us consider these things. In South Wales and Monmouth in 1934 the production of pig iron was 491,700 tons; in 1936, it was 741,000 tons. On the North-East Coast in 1934 it was 1,684,000 tons; last year it was 2,096,000 tons. You find similar figures for the production of steel ingots and castings. In South Wales, in 1934, the total volume was 1,846,000 tons, while last year it was 2,404,000 tons. On the North-East Coast, in 1934, it was 1,815,000 tons, and last year it was 2,477,000 tons. That shows how these particular areas have benefited by the general policy of the Government, how the increase in employment in these trades has spread to these particular areas, and how, therefore, by our general policy, we have made a material improvement in the first category that I mentioned, namely, the revival of the older industries.

Again, there has been a great change in the position of shipping and shipbuilding in the last couple of years. The subsidy which the Government extended to tramp shipping, and which was coupled with conditions to ensure that the subsidy should also lead to greater efficiency in the carrying on of that industry, together with the scrap-and-build scheme, has meant that there has been a great increase in building. Taking the tonnage which was under construction in 1933, on the North East Coast it amounted to 42,870 tons, while at the end of last year it was 301,250 tons. On the Clyde, at the end of 1933, it was 205,000 tons, and at the end of last year it was 413,000 tons.

I come now to coal, which, perhaps, is the least satisfactory of the three major industries which I would put in this category. The circumstances which have led to a depression in the coal trade are various, and they are not all due to the general depression in trade. They are due to a much greater efficiency in the use of coal, to new inventions which have made it possible to produce the same amount of power with a very much smaller amount of fuel. Moreover, coal has had to suffer the competition of a fuel which was never heard of when I was a child, but which is now taking the place of coal very largely on ships and in other directions. In addition to that, we have had a new form of restriction upon trading in coal in the shape of quotas imposed by foreign countries. All these things, together with the general depression, have undoubtedly brought about a situation in the coal trade and particularly in the export coal trade, which has been one of the main causes of the depression in Durham and South Wales.

Sir Robert Horne

And also the policy of the Government in relation to Italy.

Mr. Chamberlain

I do not want to argue with my right hon. Friend on that subject, but I would remind him that, even if there had been no ill feeling between Italy and this country over the way in which we interpreted our obligations under the Covenant, the situation in the coal trade with Italy was that Italy apparently was unable to pay for coal—

Sir R. Horne

She was able to pay Germany.

Mr. Chamberlain

My right hon. Friend will agree that people in this country who sold coal to Italy were unable to obtain payment—

Sir R. Horne

They are now making contracts again.

Mr. Chamberlain

I am coming to that point. The conditions I have mentioned are obviously conditions with which it is very difficult to cope, and especially those which I mentioned first; but, in so far as it has been possible for the Government to do anything to help the coal trade, they have certainly spared no effort in that direction. The coal trade has been particularly the subject of their attention in the commercial agreements which they have made. I might cite those with Argentina and Uruguay, and the arrangements which we were able to make with Holland and France, which, if they did not relax the quotas, at any rate guaranteed their stability; and I would also mention the coal-cattle agreement with Ireland, which has been a very valuable agreement for South Wales. I understand that, since the difficulties between us have come to an end, something like 2,000,000 tons of coal have been sold to Italy for delivery over the next 12 months. And, indeed, if my information is correct, there is now some anxiety among coal consumers as to whether they will be able to get all the coal that they want. It appears, therefore, that, although the coal trade still remains in a position which cannot be compared with that which it occupied some years ago, there is some improvement in that direction, and I think there are possibilites of further improvement in the future, into which I cannot now enter further.

Mr. George Griffiths

What is the capacity of the coal trade to-day? Is it not 350,000,000 tons, while we produced only 220,000,000 tons last year?

Mr. Chamberlain

I do not carry those figures in my head, but I really do not think that, even if that be so, it is in any way inconsistent with any thing I have said. I have explained that the coal trade is the most difficult of all, and that the difficulties to be overcome are due to causes which it is not in the power of any Government to remove.

Mr. Aneurin Bevan

Have the Government no new announcement to make with respect to giving assistance to the export coal trade, in view of the fact that the distressed areas exist in those parts of the country where the export coal trade is largely carried on? Have the Government no policy to assist the export coal industry?

Mr. Chamberlain

If the hon. Member is referring to the question of a subsidy, that has already been dealt with by my right hon. Friend, and I understand that the request for it has been withdrawn, or at any rate postponed. As regards the opening and extension of markets for coal, the Government are still prepared to do all that they possibly can to recover any markets which formerly existed.

Mr. Bevan

This matter is of fundamental importance. Have the Government no intention at all of bringing pressure to bear upon the coal-owners to agree to imposing a levy upon coal consumed in domestic markets, in order to enable the export industry to sustain the competition in the world markets.

Mr. Chamberlain

Of course it is obvious that a subsidy for the export trade can be financed in various ways. It can be financed out of taxation, or it can be financed by the trade, and possibly in various other ways, but I am under the impression that the whole question of a subsidy for export coal has been at any rate postponed.

I turn now to the question of new industries—the second of the ways of helping the areas to which I have referred. Here, again, the question of inducing new industries to start in these areas cannot be divorced from the general policy of the Government or the general condition of trade in the country. At a time when there is general depression no one wants to start a new industry anywhere or an extension of an old one, and the first essential to the success of that policy is to put the general trade of the country into a condition of prosperity. That is a sufficient reason, I think, for our not having been able to effect much in the way of starting new industries until quite recently. In present conditions, when extensions and expansions are going on all over the country, it is possible to consider the starting of new industries but, even so, if you are to induce industries to go to these areas instead of to others which appear to the proprietors to be more attractive, you have to adopt some abnormal methods.

The abnormal methods which we have adopted appear very hopeful. My right hon. Friend was able to give figures of the trading estate on the North East Coast from which it appears that a great deal of interest has been aroused by the establishment of this estate and already, I think, 20 factories have been definitely fixed on and a great number of others are under consideration. But there are areas where a rather different method of procedure is called for, where it is not the best way to take a considerable area of ground and build a number of factories but where, if certain smaller sites, large enough for a single factory, were purchased and cleared and a new factory erected, there is a prospect that it might find a ready tenant. This is not a whim or fancy on the part of the Government. These are ideas which have been suggested to us by those best acquainted with the conditions, and we have followed the general principle that we were prepared to try any sort of experiment which appeared to have a hopeful prospect of effecting the purpose that we have in mind. I believe that these inducements which we are now holding out, which comprise contributions to rent, rates and taxes, and which also contemplate the advance of capital and the provision of factories, will be found to be effective and, as the Committee is aware, we are extending inducements to areas outside the Special Areas. It is not consistent at the same time to belittle everything that is done inside the Special Areas and to make it a grievance that the same powers are not given to deal with areas outside. But we must forgive inconsistency when hon. Members are only searching round for vulnerable points for attack.

A number of questions have been addressed to us as to how these powers will work and, in particular, the hon. Member for Llanelly (Mr. J. Griffiths) was aggrieved because he did not get a specific answer to a question that he put about certain villages in which he is interested. When these matters are matters of interpretation by an Advisory Committee, it seems rather unfortunate that we should give any ruling beforehand or prejudge the views of the Committee. And I, therefore, want to say that, in trying to answer the hon. Member's question, he must take it that I am not laying down the law—I am not in the position to do that—and the Advisory Committee will have to make up their minds upon the circumstances of any particular case that comes before them. But I will say this about the case that he put. I do not know the places in question, but I understand that they are villages which formerly depended for their employment upon the tinplate trade. They have now suffered serious unemployment because, in consequence of a scheme of rationalisation, works which were situated near those villages had to be closed and the work is being done somewhere else. It appears to him that they would be debarred from sharing in the benefits of this inducement to new industries, because one of the conditions is that these places must be dependent upon an industry in which there is general depression and there is not general depression in the tinplate trade. Subject to the qualifications and reserves that I have made, I would suggest that these villages are no longer dependent upon the tinplate trade. The works on which they were formerly dependent have been closed and, therefore, it appears to me that they would not come under the bar which he says they would.

Again, the hon. Member for Cambridge University (Mr. Pickthorn) put a question as to whether these contributions could be made by the Commissioners in respect of industries established outside the Special Areas but whose establishment would benefit labour inside the Special Areas. That is a rather more difficult question than the first one, and I am not prepared to say offhand and finally what the answer should be. I should, however, doubt whether in such circumstances the power contained in the original Act would override the condition now laid down, namely, that the Commissioners are confined in the use of the new powers to the Special Areas themselves. That brings me to another point that I want to make. Do not let the Committee think that there is an indefinite number of new industries that can be started all over the country. There is only a certain amount of new work that you can expect people to start, and it appears to me that is is more valuable to concentrate the new industries in these particular areas than to dissipate them over a much wider area.

We have had a speech from the right hon. Gentleman the Member for Carnarvon Boroughs. No one expects him to play the part of an elder statesman. He seems to have found the secret of perpetual youth, and we all hope that he will long continue to demonstrate this youthful vivacity. I have already dealt with the contention that the measures that we are now bringing forward are grotesquely inadequate, and I have sought to show that the Bill that will follow upon this resolution is not the whole of our policy, but is merely an incident in it. The right hon. Gentleman thinks I am a hard case, but he failed to convince me that the remedy which he always brings forward for unemployment would be effectual. But I am in pretty good company there, because there are quite a number of other people, who know perhaps a good deal more about agriculture than I do, who take the view that an extension of land settlement is a project which has got to be approached with the utmost caution. To take the Commissioner himself, Sir Malcolm Stewart. He is frequently quoted with approval by hon. and right hon. Gentlemen opposite when they can find something with which they think we do not agree. Let me remind them of this passage in his Report: You cannot simplify the problem by assuming that the transit of the unemployed to the land is just an easy walk-over as though successful cultivators of the soil were mass produced. The relief that will accrue from these schemes will appear diminutive compared with the anticipation created by some colossal figures quoted. We remember those colossal figures in 1935. The right hon. Gentleman—and he is an obstinate man—still thinks it possible to put 500,000 people on the land and find employment for another 500,000 in ancillary trades. But we went into all that at some considerable length in 1935, and in a reply on the right hon. Gentleman's proposals we showed that you could not possibly put 500,000 people on the land without a very considerable artificial rise in agricultural prices. Suppose you put a lot of people into eggs and poultry to-day. Would that be a solution of the unemployed problem? You cannot expect people to go on to the land unless they can make a living out of it, and if there are experienced farmers who had been at it all their lives but are unable to make a living out of it to-day is it likely that, with a few months' intensive training, people taken from towns in the Special Areas can succeed?

Mr. Gallacher

They could if you took proper measures.

Mr. Lloyd George

With proper marketing arrangements you could.

Mr. Chamberlain

The right hon. Gentleman is an obstinate man. He has not succeded in convincing many people that you can even by what he calls proper marketing arrangements enable many more people to make a living on the land at present prices of agricultural produce. You would, under his plan, have also to interfere with the arrangements with the Dominions and foreign countries, who are at present responsible for so large a part of our imports. We have got to strike a balance between home production, Dominion production, and foreign production. The quantity of agricultural products which we consume in this country is limited and a revolution of the kind which the right hon. Gentleman contemplates would mean such a drastic cutting down of imports, whether of the Dominions or foreign countries, that we should seriously injure their purchasing power and would probably throw out of work more people in industrial production than the right hon. Gentleman hopes to put into employment in agriculture. The right hon. Gentleman may have seen a book on land settlement, a report prepared by the Carnegie United Kingdom Trustees. This report, after examining the whole situation with great care, comes to this summary of conclusions. The first conclusion is: Under existing economic conditions settlement on the land offers little hope of creating new employment. It is likely to lead to displacement of labour elsewhere and/or a general reduction in the standard of living of those already engaged in agriculture.

Mr. Lloyd George

Who is he?

Mr. Chamberlain

It is Mr. Menzies-Kitchin. I do not know whether the right hon. Gentleman has ever heard of him, but he is quite well known in the agricultural world. The second conclusion is that restriction of agricultural imports will lead to a declining export and increased unemployment, mainly in the distressed areas. When the right hon. Gentleman began to tell us, as he so often has before, about how many more people were employed in agriculture in Continental countries than are here the hon. Member for Stoke-on-Trent (Mr. E. Smith) asked, "Under what conditions?" The right hon. Gentleman objected to that and rebuked the hon. Member, for he said that he had himself spent more years in consideration of this problem than the hon. Member had spent minutes. The hon. Member has employed his minutes to better purpose. He is confirmed by another agricultural authority who has written an article which, by pure coincidence, I happened to be reading last night. He says: The fundamental truth about farming is that nearly everywhere in the world it is a peasant industry or at best a family business. Even in England and Wales nearly two thirds of the farms are under 50 acres. If your correspondent has travelled in Europe, he must have appreciated the preponderance of the peasant population everywhere. If he has had the opportunity to study their way of life he must have realised how low is their standard of comfort, when measured by their hours of labour, their opportunities for education and recreation and their enjoyment of social services by contrast with the standard of any section of the community, urban or rural, in this country.

Mr. Lloyd George

I attach some importance to this. I said that you could not possibly approach the 10,000,000 in Germany, because conditions there were such as could not be enforced here, but I pointed out that in Denmark and Holland, where conditions are the same—there are no high tariffs and the peasantry live in great comfort—there you had over 20 per cent. of the population on the land and only four per cent. here.

Mr. Chamberlain

Denmark is in a special position. The agricultural production of Denmark is chiefly for export. That is a very different problem from the problem which has to be faced in this country.

Mr. Lloyd George

But we have the markets here.

Mr. Chamberlain

The right hon. Gentleman also touched upon the Defence aspects of agricultural production. That is a question which does not affect the Special Areas, perhaps, so much as the whole country. All I want to say on that is this: Do not let the Committee imagine that the conditions to-day are the same as they were in the last War. Do not let the Committee imagine that so important an aspect of Defence as that has escaped the attention of the Government. This is not the occasion for me to enter upon the way in which we are approaching that problem, but when it is brought up as a remedy for the situation in the depressed areas, I really think it is straining beyond all reasonable measure the effect and influence of Defence upon the problem of agriculture.

There is just one point which was made by the hon. Member for Westhoughton (Mr. Rhys Davies) which I think is of importance and which is illustrated by the conditions in the Special Areas. It is the fact that the mechanisation of industry, and, I would add, of agriculture too, has the effect of continually cutting down the amount of labour which is employed to produce any result. It is a striking fact that during the period of the last few years, while the agricultural production of the country has increased by 14 per cent., the amount of labour employed has actually diminished. We have often been told that this mechanisation, this harnessing of mechanical means for man's use, although it throws people out of work at the time, eventually means that more people are employed. That is very often true, but there is always a lag between the two, and it is not always the people who are thrown out of work first of all who are afterwards employed as a result of the better consumption which follows on the mechanised processes. That is a real and a very serious problem, and is one to which I called attention four years ago in this House.

Mr. MacLaren

Henry George said that 62 years ago.

Mr. Chamberlain

I am not claiming priority. I only wish to record that I did call attention to it, and I said that it led me to the conclusion that, however prosperous the country might be, we must not imagine that we could get unemployment down to what I called a comparatively insignificant figure for another 10 years. Then I was told by a great many hon. Members that I was saying something which was very reprehensible and I received rebuke from many hon. Members not only on one side of the House. Perhaps we are beginning to recognise that this is a real problem which has to be faced. It is for that reason, that I have always maintained that, while Governments must do all they possibly can to promote employment, they must not cherish the idea that whatever they do, we shall ever get to a time when there will be no unemployment.—[An HON. MEMBER: "Why not?"]—For the reasons which I have given. Perhaps the hon. Member did not hear what I said. For the reasons that I have given there must always be, I believe, even in prosperous times, a certain number of people who would need temporary assistance.

Mr. MacLaren

That is a different thing. You said "unemployed."

Mr. Chamberlain

In fact, the majority of the people mentioned as unemployed are people who are only temporarily out of work. For that reason, therefore, I said that it would be necessary to have a permanent machinery to deal with these cases, and not to imagine that all that we have to do is to provide some palliatives or mitigation of the situation, because round the corner there is prosperity. We are not claiming that this is the solution of the problem of the Special Areas. What we are claiming is that we have applied all the remedies in the five categories that I have mentioned. Although the progress is necessarily slow at first, it is now proceeding at an increasing pace, and we have every reason to believe that it will go on producing increasingly satisfactory results.

3.10 p.m.

Mr. Cove

I beg to move, in line 3, at the end, to insert: (a) a Minister of Cabinet rank to co-ordinate the general administration of that Act and the work of the Commissioners in the discharge of their functions. We are restricted in this Amendment by the Rules of the House. The Amendment does not embody the whole policy for which we stand, because we must have regard to the Rules that have been laid down by the Chair and which have been enforced in the Debate. The Amendment does, however, embody a principle which we say should be put into practice, and that is, that there should be a definite Minister of Cabinet rank in charge of the depressed areas. It has clearly emerged from the Debate that there is a large amount of dissatisfaction with the machinery that is now in existence. We, on this side, feel very strongly that the existing machinery enables the Government to shield themselves behind the Commissioner. In our view, instead of the existing practice under which the initiative lies with the Commissioner, the initiative ought to lie directly with the Government, and there ought to be a Minister in charge who can be attacked on the Floor of the House if he does not do his job.

The Chancellor of the Exchequer, when he was speaking in 1934, in the first Debate on the appointment of the Commissioners, gave us the impression that this machinery was devised for swift and effective work. It was to be a machine that would give special powers, and was not to be conditioned or controlled by orthodox methods. Under this machinery the Commissioners would be able to get at the job quickly and do it well. He said that the Government has resolved to cut through all the ordinary methods and adopt a plan which they conceived as more suitable to the Special Areas than the methods which, in the ordinary course, would be applied to such a problem. What cutting through has there been? The machinery that has been evolved has meant delay. The greatest authority on this matter is the Commissioner, and it is obvious that after the first 12 months of his experience, he came to the conclusion that, far from the machinery being such that it would cut through, it was a machinery that brought delay, and did not enable things to be done that he wanted to be done. He said in his First Report: These limitations are no doubt necessary in order to conform to Parliamentary practice in regard to finance, but they clearly make the Commissioner as much subject to orthodox financial control as any Government Department. Whilst they may not actually hamper the freedom and initiative of the Commissioner so far as making proposals is concerned, they do result in restricting his powers to carry these proposals into effect. It is obvious that the Commissioner felt that although he could initiate proposals, the machinery was so devised that, after the proposals had been initiated and considered, it prevented them from being carried into effect. I think it is better to read the remarks of the Commissioner than for me merely to make assertions, and anyone who reads the Commissioner's Third Report is bound to come to the conclusion that he threw up his job in disgust and despair. His last Report conveys to me clearly that he felt that his work as Commissioner was being thwarted in many ways.

The Minister of Labour (Mr. Ernest Brown)

indicated dissent.

Mr. Cove

The Minister of Labour shakes his head, but I do not know what the following statements in the Report mean if they do not mean that someone far more directly responsible ought to be appointed in order to do the job: The experience of the last eighteen months has served clearly to confirm what was said on the matter in my First Report. The Commissioner acts in the word of the Special Area Act 'under the general control' of the Minister of Labour. He can propose the initiation and prosecution of any number of measures, but in questions involving new principles or substantial expenditure of public money he is obliged to get the agreement of the Minister, who in turn has to comply with the normal departmental practice in regard to Treasury sanctions. The result is that the Commissioner"— And this is very important— is one stage further removed from final authority in matters of expenditure than an ordinary Government Department, and it is obvious that this must involve some additional delay and additional remoteness from direct contact and action. The Commander himself says that he is remote from the real source of financial authority, and is apparently further away from the Chancellor of the Exchequer than he desires to be. He would like to have someone who would be in closer contact. The Report goes on to state: It is difficult to see how the office of Commissioner can be usefully continued unless it is endowed with authority to take independent action. I do not want to be unfair and I quote what he adds: This I do not suggest. The desirability of direct administration by Ministers will require re-examination if the Government accepts my recommendations in view of the increased responsibilities which would be involved in their operation. This Amendment gives the Government a chance to reconsider the whole question of administration. It is clear from the words which I have quoted that the Commissioner had come to the definite conclusion that he could no longer carry out the proposals which he himself was making, and that a radical change in the machinery for dealing with the distressed areas had become essential. I do not know what else can be read into those words. It is evident that if the depressed areas are to get anything, even under this scheme, they must have a direct representative in the Cabinet. The political career of someone must depend upon what that person does for the Special Areas. The responsibility ought to pass from the Commissioner, and ought to be entrusted to a responsible Minister. The period of experiment and trial is over and the period of responsibility ought to begin. That period of responsibility can only begin by a Minister of Cabinet rank having direct charge of the problem and being answerable to the House. That Minister should be appointed in order that action may be taken more swifty and effectively than in the past.

3.22 p.m.

Mr. Jenkins

I beg to second the Amendment.

The problem of the Special Areas has been described by the Chancellor of the Exchequer as one of great importance, and from what he has said the right hon. Gentleman himself apparently does not expect that the proposals now under consideration will be a solution of the problem. That is all the more reason why we should have a Cabinet Minister responsible to Parliament for dealing with this question. The problem has long been the subject of consideration by the House of Commons and various forms of treatment have been applied to it for some years past but it is clear that we have made no serious inroads upon it. The right hon. Gentleman's speech indicated that he is relying in the main, at present, upon the upward tendency of trade throughout the country rather than upon special measures for dealing with these areas. Therefore, it is a matter which should be the subject of day-to-day consideration in the House of Commons, with a Minister definitely responsible to the House.

3.24 p.m.

Mr. Aneurin Bevan

In the discussion recently upon the Standing Orders, arising out of the limitation imposed upon the House of Commons by the Money Resolution, the opinion was expressed in all parts of the Committee, that the Committee ought to have the opportunity of reaching its own conclusion and that hon. Members should therefore have the opportunity of putting down amendments. This is the only Amendment which is in order on the Money Resolution and the interest which hon. Members take in their Parliamentary duties is evidenced by the crowded benches opposite. The Chancellor of the Exchequer has spoken; hon. Members are perfectly satisfied with what he has said; they hope that this Resolution will go through, and that they will not be bothered about it for another three or four years. In the meantime we who represent the distressed areas can spend our time running around to interview nonelected and irresponsible persons.

This problem is one for which the House of Commons is peculiarly fitted, and indeed it is the only problem that the House of Commons is able intelligently to deal with. Many of us represent constituencies in which from 50 to 70 per cent. of the adult population are unemployed, and many of them have been unemployed for as long as 10 years. For us, therefore, to represent the grievances of these people constitutes the bulk of our Parliamentary obligations. The hon. Member for Jarrow (Miss Wilkinson), my hon Friends who represent Rhondda, the North-East Coast, parts of Scotland, and parts of Lancashire, and myself, who are constantly made aware of the difficulties arising out of unemployment, find that our Parliamentary duties consist almost entirely in putting these matters before the House, and the only effective way in which we can do that is to have a Minister who is responsible to the House for the way in which the Government's policy in this connection is carried out. Otherwise, to put this into the hands of a Commissioner not directly answerable to the House of Commons is to disfranchise all those constituencies in which this problem exists.

The Government's sincerity in dealing with the problem of the distressed areas will be tested by the right hon. Gentleman's answer to this Amendment, because if he is satisfied that the additional powers to be conferred upon the Commissioner are actually going to be used, and that the schemes explained by the Chancellor to-day are indeed a contribution to the distressed areas, then he should be only too pleased to have a man at that box who day by day can be challenged in this House on these matters. But we believe and we have evidence of this that the Commissioner for the distressed areas is not an executive to carry out these schemes at all, but a decoy to lead us away from the Treasury Box to some hole and corner office somewhere else. I have been on countless deputations to the Commissioner representing local authorities, taking deputations of local authorities and going there myself and as a Member of Parliament I deeply resent the humiliation of having to go to a non elected unpaid, irresponsible person in order to place before him the grievances of my constituents. I regard it as an outrage against parliamentary institutions that that commissioner should exist. It is bad enough when we have to go across the road to interview civil servants grown arrogant by irresponsible power but to have to—

The Chairman

I would remind the hon. Member that it is against the practice of the House for Members to speak in that way about civil servants.

Mr. Bevan

I have never known it to be against the practice of the House to make general observations about the Civil Service before, but I bow to your Ruling. It is, however, humiliating in the extreme to have to lead these deputations to persons who cannot be called in question for any decisions that he makes. I suggest, therefore, that the Amendment will put into the hands of the House a powerful lever to enable it from time to time to bring influence to bear on the decisions of the Government. There is a further reason why the Amendment should be carried. The proposal to appoint a Commissioner first occurred in 1934, at the time when the Unemployment Insurance Act was before the House. At that time we were told that the Commissioner was not to be a permanent official, but was to be merely a pioneer to carry out work which ultimately would be transferred to the Unemployment Assistance Board or to some other Government Department. It has not been transferred to either. It has not been transferred to a Government Department, for the Minister of Labour is only nominally responsible for what the Commissioner does. If he were more than nominally responsible, he would have had a far worse time than he has had in the last two years. He may say that that is impossible, but he has been a very fortunate man up to now, and some very unpleasant things are going to happen to him in the immediate future. The right hon. Gentleman smiles, but we shall see. Although the Commissioner was appointed as an experiment, as a temporary expedient, he still remains. He remains because the Government have discovered that he is a very useful device to divert pressure and attention from the front bench opposite.

Mr. S. O. Davies

A shock absorber.

Mr. Bevan

I agree. Therefore, it would be a splendid thing if this Minister were appointed. This is not a new proposal, because the Welsh Parliamentary party, at a deputation to the Prime Minister some months ago, put this proposal forward as one of the ways of creating a machine which could bring sustained attention upon this problem. I have only to say this in conclusion, because I realise that the House is now completely jaded by this problem, and that hon. Members are anxious to forget all about it after having a speech from the Chancellor of the Exchequer, which was a splendid piece of window-dressing. If hon. Members are sincere in their desire to do something for the distressed areas, they might be able to realise that the appointment of a Minister will be one of the most effective ways of doing it. I do not say who the Minister might be, but let us suppose he is the Minister of Labour. Suppose the right hon. Gentleman is seconded from his present position in order to undertake these duties. We all know what an aggressive, industrious, sometimes belligerent, and ambitious person the Minister of Labour is. None of these qualities is undesirable. They would be a perfect combination if other qualities were added to them.

Suppose the Minister of Labour were appointed to this position and his political career depended on the success he achieved. I am quite sure that we should have harnessed to the problem of the distressed areas a volcano of energy if the right hon. Gentleman were put on the job. He would not allow his political prospects to be destroyed by a failure to do that job, and day by day he would be only too anxious to prove to the House that his appointment was a proper one and that he was making inroads on the problem. So from the point of view of the constitution of the House of Commons and from the point of view of psychology it would be an excellent thing to harness to this attack on the distressed areas a Minister with all those qualities and with that self-interest to defend. Now he need not bother about it, because he can always say, "This is the Commissioner's job," that if there is failure it is the Commissioner who has failed and not the Minister or the Government. Again, we ought to have a friend at court. If a Member of the Cabinet were responsible for this work he could co-ordinate the different activities and it might be possible to get something done.

For a number of years we have been making proposals, but to-day the Chancellor of the Exchequer dismissed a great many of them with a few very inadequate words. It would be out of order for me to discuss them, and I will simply mention them in passing as being the sort of proposals which the Minister could bring before the Cabinet until decisions were reached upon them. There is the problem of the export coal trade. It is fantastic for the Chancellor of the Exchequer to stand there and speak about Government schemes for the distressed areas in view of the fact that they are the areas where the coal trade exists, and that that trade has been left in a lamentable condition of disorganisation for 15 to 20 years.

Had there been a Minister responsible for this problem he would have said, "If you are going to tackle the problem of the distressed areas you must tackle the foundation industry there." [Interruption.] The Secretary for Mines is not responsible for those areas—or for anything else. He is not a Cabinet Minister, and he has to speak to the Cabinet through the President of the Board of Trade, who is the worst possible Minister to be in charge of a problem of this kind. We require a Minister for the distressed areas who will be able to co-ordinate as part of a central plan all the efforts made to solve the problem of the distressed areas, and not to consider each effort in isolation. The reason why schemes have not been undertaken so far is that they have been considered in isolation. I will leave the problem of coal, though I am sure I could satisfy hon. Members in all parts of the House that a reorganised coal trade would more than halve the problem of the distresed areas in South Wales and on the North-East Coast.

The Minister of Labour has a special problem. He is concerned with unem- ployment insurance and is under an obligation to carry out existing Statutes, and has to consider the problem entirely from that angle. There is the means test. The Government take hundreds of thousands, even millions, a year from the distressed areas under the means test, because it is there that we have the largest percentage of people subject to the means test. The problem of rates could be discussed by a special Minister and kept before the Cabinet all the time. At present the problem of rates is primarily the concern of the Minister of Health, but he has a number of other tasks to perform, and is not able to consider rates from the angle of the distressed areas. The proposal made in this Amendment ought to commend itself to all hon. Members, and I hope to hear that the Government propose to accept it. It will not be enough to tell us that a Minister of Labour is responsible to this House for anything done by the Commissioner. What we Want is a Minister directly appointed to solve this problem, which has been described by the Prime Minister as the most staggering of the problems of this country.

3.40 p.m.

Mr. Ede

I want to support the Amendment because it seems to me from what appeared in the Northern Press this morning that the Minister himself really has not time now to do the business that falls to him with regard to this matter. I have tried to ascertain whether the hon. Member for Gateshead (Mr. Magnay) is present to-day, but I have not been able to find him and I understand he is not here. But a statement appears in the "North Mail" this morning regarding the establishment of a second trading estate within the constituency of the hon. Member for Gateshead. This is the statement: Mr. M. Percival, Secretary of the North Eastern Trading Estates, Limited, said he had no official statement that they were to take over the salt meadows site. When such an announcement was available it would be made public. 'All I know' he added, 'is that Mr. Tom Magnay, M.P. for Gateshead, told me that the Minister of Labour had informed him— I am always hearing this sort of thing, about someone who knows from a stable lad, who told the sweetheart of a parent's neighbour and can put you on a good thing— 'that we were to take over and manage, in conjunction with the Team Valley Trading Estate, this riverside site'. Quite obviously that is a most improper way for these pronouncements to be made. We all know that the hon. Member for Gateshead said in the House the other night that if you only lathered a man enough you could shave him very close. Apparently the hon. Member has been able to shave the Minister of Labour in his sleep. It may be that he is merely a prophetic thought-reader. We heard him say in effect, "Only be genial enough to Ministers, flatter them enough, and you can have your constituency surrounded by these estates, not merely two in the constituency but another one slightly to the South of Birtley. Only be subservient to the Minister and lather him well, and then you can get what you like." There were certain hon. Members in the House, my hon. Friend the Member for Houghton-le-Spring (Mr. W. Joseph Stewart) and the hon. Member for Durham (Mr. Ritson) who joined with two servile supporters of the Minister, the senior and junior Members for Sunderland (Mr. Furness and Mr. Storey) in asking that an estate that would have served the whole of their constituencies might be considered. Apparently the hon. Member for Gateshead can be let into all the secrets. I gather that the Minister of Labour does not quite approve of the way the hon. Member "blows the gaff" after the thing has been done, but I suggest that it is ample proof of the need for a Minister who will be able to deal properly with the subject and keep some control over the more exumberant of his own followers.

3.44 p.m.

Mr. E. Brown

There appears to be a distinct cleavage of opinion as to what the Minister is and is not able to do at the moment. The hon. Member who first spoke in support of this Amendment had the idea that the Minister had nothing whatever to do with the matter, that he has merely to answer questions raised in a Debate, but according to the standard of judgment which the hon. Member for South Shields (Mr. Ede) set for himself, he has to accept any Press statement on which he first casts his eye, and that then the hon. Member can throw a brick across the Floor at the Minister, although the hon. Member knows that he would not be able to get a question put on the Paper in that form. Apparently, in his view, the Minister is all powerful to do what he pleases. The hon. Member cannot have it both ways. If the hon. Member will listen to me I will throw a little light on this matter. As to the hon. Member for Ebbw Vale (Mr. Bevan), I am in doubt what he wants to do. I am in doubt whether he wants to take up a place on the judgment seat and send me to eternal doom, or to promote my hon. and gallant Friend the Secretary for Mines to Cabinet rank.

The Amendment seems to be misconceived. The hon. Member for Aberavon (Mr. Cove) put into the mouth of Sir Malcolm Stewart statements which the Commissioner did not make. The suggestion was that the Commissioner said that we ought to have a Minister; he said nothing of the kind. Any Member who will read his Third Report will find that he said nothing of the kind. Sir Malcolm Stewart did say, in suggesting these new inducements for new industries, that the problem whether a Minister should be appointed ought to be re-examined. That is a very different thing. [Interruption.] If the hon. Member for Aberavon will allow me, I will read the exact words.

Mr. Cove

It is on page 15.

Mr. Brown

I will give it to the hon. Member in my own way. The report says this: It is difficult to see how the office of Commissioner can be usefully continued unless it is endowed with authority to take independent action. This I do not suggest. The desirability of direct administration by Ministers will require re-examination if the Government accepts my recommendations, in view of the increased responsibilities which would be involved in their operation.

Mr. Cove

Hear, hear. That is my case.

Mr. Brown

That extract bears out precisely what I told the Committee. The hon. Member for Aberavon had told the Committee that it was a recommendation of the Commissioner but I said it was nothing of the kind. The Commissioner pointed out that in view of the wide new functions, the question of whether a Minister should be appointed should be re-examined. I am happy to tell the Committee that it has been re-examined. I would like to say a word or two about the way in which the machinery works, but before I turn to that point I would like to dispose of another point made by the hon. Member for Aberavon. He said that the Commissioner resigned because he was "cabin'd, cribb'd, confin'd" and dissatisfied with the working of the arrangements of the Minister of Labour responsible in this House, and the terms of the Act. Let me again appeal to the Commissioner and not to what hon. Members say, to establish what he said. This is what is stated in his Third Report: With regret I lay down my office and am grateful for the opportunity given me of endeavouring to do something to improve the lot of the unemployed and to assist in the development of the Special Areas. The strain and anxiety of my responsibilities have been considerable and now that the work is running smoothly, and perhaps most of the major measures possible under the Act inaugurated, I feel justified in seeking a rest. I would call hon. Members special attention to the word "smoothly." [Interruption.] It is a sorry comment on the attitude of hon. Members opposite that they cannot stand facts being brought forward. Their disinclination to face facts is equalled only by their inclination to snatch at any casual straw that suggests a solution. They are suggesting that a Minister is the solution of this problem. There was a time when they were faced with it and when it was not as grave as it was when they left it for us. What did they do? They had not any idea of appointing one Minister; they appointed three, not one. This is not a mere debating point, but has a very real bearing on the problem. The problem is that of the new technique which they have advocated. The late right hon. William Graham stood at this corner—for he never stood at the Box—and over and over again argued that a new technique would have to be evolved in Government in order that Parliament, on the one hand, and industry and labour on the other, should be able to work together to face new situations.

What was the technique? The technique was the setting up of statutory bodies for which a Minister on the Floor of this House would answer—[Interruption.]—Perhaps hon. Members will listen to me with some degree of quietness, and it may be with some little respect, because I happen to be in an office which has had more experience of this new technique than any other Department. The Minister of Labour is responsible for three of these bodies—quite different bodies. He is responsible for a Committee which has statutory powers in relation to Unemployment Insurance; he is responsible for answering in this House for the Unemployment Assistance Board; and he is responsible in respect of England and Wales for the Special Commissioner, who also has statutory powers. I am very glad that this Amendment has been put down to-day, because it enables me to say a word or two about how the thing works.

I have not observed that I have been attacked because I answer for, but am not directly responsible for the day-to-day administration of, the Statutory Committee, the Board or the Special Commissioner, and I do not think that it would be the wish of the House to attack me. Indeed, it so happens that last Session, on Supply Days, hon. Members opposite did not call for my Estimates, and the only two occasions on which I was asked to defend, apart from legislation, what was being done, were in connection with problems—which were not on my Estimates—with respect to the Unemployment Assistance Board on the one hand and the grappling with unemployment on the other. This new technique ought to be taken seriously, and I am taking it seriously, because I have to answer, and my successor will have to answer, for the statutory bodies that will work in this new field. So far from its being true to say that there has been unusual delay in the technique, I would say that, so far as the Ministry of Labour is concerned, the problems of the Special Commissioner always have priority in my Ministry. When it is said that the Commissioner is now put one step further back, I would reply that the Opposition Amendment would put him one step further back still, because what he has to do is laid down in the Act. The Act, in the early part of Sub-section (3) of Section I, says that: The Commissioner shall act under the general control of the appropriate Minister, and it shall be the duty of the Commissioners to make suggestions to, and co-operate with, Government departments, local authorities, voluntary organisations and other bodies concerned with matters within the functions of the Commissioners. What does that mean? It means that the Commissioner, under the general control of Parliament—and I am responsible, as Minister of Labour, for that general control—is able to do a whole heap of things of an entirely new and original kind, which affect, not merely voluntary organisations, but local authorities and, in some cases, three, four, five and six Government Departments. Is it to be supposed that, if a new Minister were appointed, without a Department, to take control, he would find it easy to fulfil that function with new, unformulated ideas? Indeed, the hon. Member for Bishop Auckland (Mr. Dalton) made a complaint against our present proposals, not on the ground that they were not flexible, but on the ground that they were too flexible. He wants a formula, and I have no doubt that, if you had a new Minister specially responsible, you would need to give him a formula. After all, what could the Minister do? A new Minister is not co-ordinating some definite, clear line of policy. He is overseeing a new experiment in which he is encouraging the Commissioner to do all kinds of original and unusual things and in this Amendment to be given completely unique powers to exercise his own discretion as to the amounts of money to be remitted to firms going to particular parts of his area.

A Minister can do one of three things to his Government. He can either persuade them, or counsel them or override them. I cannot imagine this House giving any particular Minister the power to override all his other colleagues. As a matter of fact, what the Amendment asks for is to endow one Minister with powers which at the moment are possessed only by the Prime Minister of the day. Speaking from my own Departmental experience, I would say that, while it is true that in the early days, when new and difficult problems came up for solution, it was not easy to get decisions about some things and, when new points of principle involving large sums of public money were involved, the House would not expect decisions to be come to without a thorough examination, yet the Commissioner himself said, in the quotation that I have read, that it is now working smoothly. More than that, I would say that we have re-examined the problem and, in the light of that, there is now a Committee of three, one representing the Treasury, one the Minister of Labour, and one the Commissioner, sitting regularly so that there may be a channel for getting quick decisions on points which do not raise any new point of principle which ought to be discussed as affecting the country as a whole. I should be very happy as a Departmental Minister if I could have got in my own Department decisions on some points as quickly as my colleagues enabled me to get them in the interest of the Special Areas.

This Amendment is misconceived. The hon. Member for Aberavon desired to approach and attack a Minister. I have not been unaware of the attacks. I expect more in the future if the Committee refuses to accept the Amendment. He also wanted a Minister in order to approach him. I may have all the virtues and many of the vices mentioned by the hon. Member for Ebbw Vale, but

I do not think that those who wish to judge me have ever accused me of being an unapproachable Minister. The hon. Member for Ebbw Vale should be the last to complain about futile applications. His division is a standing proof that the machinery set up in 1934 is able to work, for he was not merely able to bring deputations to the Commissioner, but I have a distinct recollection of seeing and hearing him very eloquent on deputations both to the President of the Board of Trade and to myself. We have re-examined the problem, we do not think it will work and we ask the Committee to refuse to accept it.

Question put, "That those words be there inserted."

The Committee divided: Ayes, 124; Noes, 233.

Division No. 106.]	AYES.	[3.58 p.m.
Acland, R. T. O. (Barnstaple)	Gibson, R. (Greenock)	Potts, J.
Adams, D. M. (Poplar, S.)	Green, W. H. (Deptford)	Price, M. P.
Adamson, W. M.	Greenwood, Rt. Hon. A.	Quibell, D. J. K
Alexander, Rt. Hon. A. V. (H'Isbr.)	Grenfell, D. R.	Rathbone, Eleanor (English Univ's.)
Amman, C. G.	Griffiths, G. A. (Hemsworth)	Ridley, G.
Anderson, F. (Whitehaven)	Griffiths, J. (Llanelly)	Ritson, J.
Attlee, Rt. Hon. C. R.	Hall, J. H. (Whitechapel)	Robinson, W. A. (St. Helens)
Banfield, J. W.	Hardie, G. D.	Rothsohild, J. A. da
Barnes, A. J.	Harris, Sir P. A.	Rowson, G.
Baley, J.	Hayday, A.	Sanders, W. S.
Bellenger. F. J.	Henderson, J. (Ardwick)	Seely, Sir H. M.
Bevan, A.	Henderson, T. (Tradeston)	Shinwell, E.
Broad, F. A.	Hicks, E. G.	Short, A.
Brooke, W.	Hollins, A.	Silkin, L.
Brown, C. (Mansfield)	Hopkin, D.	Simpson, F. B.
Burke, W. A.	Jenkins, A. (Pontypool)	Sinclair, Rt. Hon. Sir A. (C'thn't)
Charleton, H. C.	Jenkins, Sir W. (Neath)	Smith, Ben (Rotherhithe)
Chater, D.	John, W.	Smith, E. (Stoke)
Cluse, W. S.	Jones, A. C. (Shipley)	Smith, Rt. Hon, H. B. Lees- (K'ly)
Cooks, F. S.	Jones, J. J. (Silvertown)	Sorensen, R. W.
Cove, W. G.	Jones, Morgan (Caerphilly)	Stewart, W. J. (H'ght'n-le-Sp'ng)
Daggar, G.	Kelly, W. T.	Strauss, G. R. (Lambeth, N.)
Davidson, J. J. (Maryhill)	Kennedy, Rt. Hon. T.	Taylor, R. J. (Morpeth)
Davies, R. J. (Westhoughton)	Kirby, B. V.	Thurtle, E.
Davies, S. O. (Merthyr)	Lansbury, Rt. Hon. G.	Tinker, J. J.
Day, H.	Lawson, J. J.	Viant, S. P.
Dobbie, W.	Leach, W.	Walkden, A. G.
Dunn, E. (Rother Valley)	Lee, F.	Walker, J.
Ede, J. C.	Lunn, W.	Watkins, F. C.
Edwards, A. (Middlesbrough E.)	MacLaren, A.	Wedgwood, Rt. Hon, J. C.
Edwards, Sir C. (Bedwellty)	MacNeill, Weir, L.	Westwood, J.
Evans, D, O. (Cardigan)	McEntee, V. La T.	Whiteley, W.
Evans, E. (Univ. of Wales)	McGhee, H. G.	Wilkinson, Ellen
Fletcher, Lt.-Comdr. R. T. H.	Milner, Major J.	Williams, E. J. (Ogmore)
Foot, D. M.	Montague, F.	Williams, T. (Dan Valley)
Frankel, D.	Morrison, Rt. Hon. H. (Hackney, S.)	Wilson, C. H. (Attereliffe)
Gallacher, W.	Morrison, R. C. (Tottenham, N.)	Windsor, W. (Hull, C.)
Gardner, B. W.	Noel-Baker, P. J.	Woods, G. S. (Finsbury)
Garro Jones, G. M.	Oliver, G. H.	Young, Sir R. (Newton)
George, Rt. Hon. D. Lloyd (Carn'v'n)	Parker, J.
George, Major G. Lloyd (Pembroke)	Parkinson, J. A.	TELLERS FOR THE AYES.—
George, Megan Lloyd (Anglesey)	Pethick-Lawrence, F. W.	Mr. Mathers and Mr. Groves.
NOES.
Agnew, Lieut.-Comdr. P. G.	Anderson, Sir A. Garrett (C. of Ldn.)	Balfour, G. (Hampstead)
Albery, Sir Irving	Assheton, R.	Balfour, Capt. H. H. (Isle of Thanet)
Allen, Lt.-Col. J. Sandeman (B'kn'hd)	Astor, Hon. W. W. (Fulham, E.)	Balniel, Lord
Allen, Lt.-Col. Sir W. J. (Armagh)	Atholl, Duchess of	Beamish, Rear-Admiral T. P. H.
Amery, Rt. Hon. L. C. M. S.	Baldwin-Webb, Col. J.	Beauchamp, Sir B. C.
Beaumont, Hon. R. E. B. (Portim'h)	Gower, Sir R. V.	Peat, C. U.
Beit, Sir A. L.	Grant-Ferris, R.	Penny, Sir G.
Bennett, Sir E. N.	Grotton, Col. Rt. Hon. J.	Percy, Rt. Hen. Lord E.
Bernays, R. H.	Grimston, R. V.	Peters, Dr. S. J.
Birchall, Sir A. D.	Gritten, W. G. Howard	Petherick, M.
Bird, Sir R. B.	Guest, Hon. I. (Brecon and Radnor)	Pickthorn, K. W. M.
Blair, Sir R.	Guest, Mai. Hon. O. (C'mb'rw'll, N.W.)	Pilkington, R.
Bottom, A. C.	Gunston, Capt. O. W.	Plugge, Capt. L. F.
Boulton, W. W.	Guy, J. C. M.	Ponsonby, Col. C. E.
Bowater, Col. Sir T. Vansittart	Hamilton, Sir G. C.	Pownall, Lt.-Ool. Sir Assheton
Bowyer, Capt. Sir G. E. W.	Hanbury, Sir C.	Procter, Major H. A.
Boyd-Carpenter, Major Sir A. B.	Hannah, I. C.	Ramsbotham, H.
Bracken, B.	Hannon, Sir P. J. H.	Rankin, Sir R.
Braithwaite, Major A. N.	Hartington, Marquess of	Rathbone, J. R. (Bodmin)
Brass, Sir W.	Haslam, Sir J. (Bolton)	Reed, A. C. (Exeter)
Briscoe, Capt. R. C.	Heneage, Lieut.-Colonel A. P.	Reid, Captain A. Cunningham
Brocktebank, C. E. R.	Hepburn, P. G. T. Buchan-	Reid, W. Allan (Derby)
Brown, Rt. Hon, E. (Leith)	Herbert, Major J. A. (Monmouth)	Ropner, Colonel L.
Brown, Brig.-Gen. H. C. (Newbury)	Hills, Major Rt. Hon. J. W. (Ripon)	Ross, Major Sir R. D. (Londonderry)
Browne, A. C. (Ballast, W.)	Holmes, J. S.	Ross Taylor, W. (Woodbridge)
Bull, B. B.	Hore-Belisha, Rt. Hon. L.	Rowlands, G.
Bullock, Capt. M.	Home, Rt. Hon. Sir R. S.	Runciman, Rt. Hon. W.
Burghley, Lord	Howitt, Dr. A. B.	Russell, A. West (Tynemouth)
Burgin, Dr. E. L.	Hudson, Capt. A. U. M. (Hack., N.)	Russell, S. H. M. (Darwen)
Burton, Col. H. W.	Hudson, R. S. (Southport)	Salmon, Sir I.
Butler, R. A.	Hume, Sir G. H.	Samuel, M. R. A.
Caine, G. R. Hall-	Inskip, Rt. Hon. Sir T. W. H.	Sandeman, Sir N. S.
Campbell, Sir E. T.	Jarvis, Sir J. J.	Sanderson, Sir F. B.
Gary, R. A.	Jones, L. (Swantea W.)	Sassoon, Rt. Hon. Sir P.
Cattlereagh, Viscount	Keeling, E. H.	Scott, Lord William
Cayzer, Sir C. W. (City of Chester)	Kerr, J. Graham (Scottish Univs.)	Selley, H. R.
Gazalet, Thelma (Islington, E.)	Kimball, L.	Shakespeare, G. H.
Chamberlain, Rt. Hn. N. (Edgb't'n)	Lamb, Sir J. Q.	Shaw, Captain W. T. (Forfar)
Channon, H.	Lambert, Rt. Hon. G.	Smiles, Lieut.-Colonel Sir W. D.
Chapman, Sir S. (Edinburgh, S.)	Law, R. K. (Hull, S.W.)	Smith, Bracewell (Dulwich)
Christie, J. A.	Leckie, J. A.	Smith, Sir R. W. (Aberdeen)
Clarke, U.-Col. R. S. (E. Grinstead)	Lennox-Boyd, A. T. L.	Smithers, Sir W.
Cobb, Captain E. C. (Preston)	Lewis, O.	Somerset, T.
Colman, N. C. D.	Liddall, W. S.	Somervell. Sir D. B. (Crewe)
Colville, Lt.-Col. Rt. Hon. D. J.	Llewellin, Lieut.-Col. J. J.	Somerville, A. A. (Windsor)
Cooke, J. D. (Hammersmith, S.)	Lloyd, G. W.	Southby, Commander A. R. J.
Cooper, Rt. Hn. A. Duff (W'tt'r S. G'gs)	Locker-Lampson, Comdr. O. S.	Spears, Brigadier-General E. L.
Courtauld, Major J. S.	Loltus, P. C.	Spens. W. P.
Courthope, Col. Sir G. L.	Lovat-Fraser, J. A.	Stanley, Rt. Hon. Oliver (W'm'I'd)
Cranborne, Viscount	Lumley, Capt. L. R.	Stewart, J. Henderson (Fife, E.)
Craven-Ellis, W.	Mabane, W. (Huddersfield)	Strauss, E. A. (Southwark, N.)
Croft, Brig.-Gen. Sir H. Page	MacAndrew, Colonel Sir C. G.	Strauss, H. G. (Norwich)
Crooke, J. S.	McCorquodale, M. S.	Stuart, Hon. J. (Moray and Nairn)
Crockshank, Capt. H. F. C.	MacDonald, Rt. Hon. J. R. (Soot. U.)	Tate, Mavis C.
Cross, R. H.	MacDonald, Rt. Hon. M. (Ross)	Taylor, C. S. (Eastbourne)
Crossley, A. C.	Macdonald, Capt. P. (Isle of Wight)	Titchfield, Marquess of
Davies, Major Sir G. F. (Yeovil)	Macquisten, F. A.	Train, Sir J.
Davison, Sir W. H.	Maitland, A.	Tree, A. R. L. F.
Denville, Alfred	Margesson, Capt. Rt. Hon. H. D. R.	Tryon, Major Rt. Hon. G. C.
Doland, G. F.	Markham, S. F.	Tufnell, Lieut.-Commander R. L.
Donner, P. W.	Mason, Lt.-Col. Hon. G. K. M.	Wakefield, W. W.
Duckworth, Arthur (Shrewsbury)	Maxwell, Hon. S. A.	Wallace, Capt. Rt. Hon. Euan
Duckworth, W. R. (Moss Side)	Mayhew, Lt.-Col. J.	Ward, Lieut.-Col. Sir A. L. (Hull)
Duggan, H. J.	Meller, Sir R. J. (Mitcham)	Ward, Irene M. B. (Wallsend)
Duncan, J. A. L.	Mellor, Sir J. S. P. (Tamworth)	Wardlaw-Milne, Sir J. S.
Edmondson, Major Sir J.	Mills, Sir F. (Leyton, E.)	Waterhouse, Captain C.
Elliot, Rt. Hon. W. E.	Mills, Major J. D. (New Forest)	Wayland, Sir W. A
Ellis, Sir G.	Mitcheson, Sir G. G.	Wells, S. R.
Emmott, C. E. G. C.	Moore, Lieut.-Col. T. C. R.	Wickham, Lt.-Col. E. T. R.
Emrys-Evans, P. V.	Moreing, A. C.	Williams, H. G. (Croydon, S.)
Errington, E.	Morrison, Rt. Hon. W. S. (Cirencester)	Willoughby de Eresby, Lord
Fildes, Sir H.	Munro, P.	Wilson, Lt.-Col. Sir A. T. (Hitchin)
Fox, Sir G. W. G.	Neven-Spence, Major B. H. H.	Windsor-Clive, Lieut.-Colonel G.
Fremantle, Sir F. E.	O'Neill, Major Rt. Hon. Sir Hugh	Wragg, H.
Fyfo, D. P. M.	Ormsby-Gore, Rt. Hon. W. G. A.	Young, A. S. L. (Partick)
Ganzoni, Sir J.	Orr-Ewing, I. L.
Gilmour, Lt.-Col. Rt. Hon. Sir J.	Palmer, G. E. H.	TELLERS FOR THE NOES.—
Gluckstein, L. H.	Patrick, C. M.	Str Henry Morris-Jones and
Goldie, N. B.	Peake, O.	Captain Hope.

Question, That it is expedient to continue the Special Areas (Development and Improvement) Act, 1934, until the thirty-first day of March, nineteen hundred and thirty-nine, and to make further statutory provision for—

1. (a) enabling the Commissioners for the purpose of inducing persons to establish in- 1604 dustrial undertakings in the Special Areas, to let factories in those areas for the occupation of such undertakings and to contribute for periods not exceeding five years towards the rent, income tax, and rates payable in respect of industrial undertakings hereafter established in places approved by the Commissioners within those areas, 1605 notwithstanding that any such undertaking may be carried on for the purpose of gain;
2. (b) enabling the Commissioners to make grants towards expenses incurred by local authorities in the repair or improvement of streets in any Special Areas which are certified by the Minister of Transport as being wholly or mainly required for purposes other than those of through traffic, and to contribute towards expenses incurred by owners or occupiers of agricultural land in any Special Areas in connection with the execution of works of field drainage notwithstanding that the land is occupied for the purpose of gain;
3. (c) enabling the Treasury to give financial assistance for any area outside the Special Areas, as to which the Minister of Labour certifies that there is and has been for a considerable time severe unemployment in the area, that without such financial assistance there will be no immediate likelihood of a substantial increase in employment in the area, and that employment in the area is mainly dependent on one or more industries which are unable to provide sufficient employment by reason of general depression in those industries:

Provided that such financial assistance shall only be given either by means of subscription to the share capital of site-companies incorporated for the purpose of providing factories in such areas with a view to inducing persons to establish industrial undertakings therein, or by means of loans to such companies, and the assistance provided to any such company shall not exceed an amount equal to one-third of its paid up share capital exclusive of any share capital held by the Treasury; (d) enabling the Treasury to provide financial assistance, not exceeding in the aggregate two million pounds, by way of loan to persons carrying on industrial undertakings which are hereafter established in any Special Area or, in the case of industrial undertakings occupying factories provided by site-companies, in any such area as is mentioned in the last foregoing paragraph of this Resolution; (e) the payment out of moneys provided by Parliament of any sums required for the purposes aforesaid; and (f) supplementary and consequential matters. In this Resolution the following expressions have the meanings hereby assigned to them— Commissioners" means the Commissioners appointed under the Special Areas (Development and Improvement) Act, 1934, and "Special Areas" means the areas specified in the First Schedule to that Act; Site-company" means a body corporate established for the purpose specified in paragraph (c) of this Resolution, being a body which does not trade for profit or a body whereof the constitution forbids the payment of any interest or dividend at a rate exceeding such rate as may be for the time being prescribed by the Treasury,"—

put, and agreed to

Resolution to be reported upon Monday next.

The remaining Orders were read, and postponed.

Whereupon Mr. SPEAKER adjourned the House without Question put pursuant to Standing Order No. 2.

Adjourned at Twelve Minutes after Four o'Clock until Monday next, 15th March.