BACON INDUSTRY BILL.

HC Deb 11 April 1938 vol 334 cc775-893

Order for Second Reading read.

3.40 p.m.

The Minister of Agriculture (Mr. W. S. Morrison)

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

The Bill, as its Title indicates, deals with the bacon industry of this country, and the peculiar problems of that industry arise from the fact that it has both a producing and a processing side and that the prosperity of each is affected by the efficiency of the other. In order that the House may approach the consideration of the Bill with all the circumstances in mind, I hope hon. Members will permit me to say a few words of a historical character, with the intention of indicating the present position of the industry and showing how the need for further legislation arises. The history of the industry in this country divides itself into two periods, one period before 1933 and the second period after that year. Though the former of these two periods is, by far, the longer in time, it needs but a brief reference from me.

Bacon curing, of course, was early established as an industry in this country, but the type of article demanded by the market has varied considerably. A century ago Cobbett said that lean bacon was fit only for drunkards who wanted to stimulate a sickly appetite. He also said that if a pig was able to walk 200 or 300 yards at a stretch it was a clear indication that it was not fat enough for bacon. Cobbett's studies of the economics of bacon production led him into a striking and somewhat original anticipation of what our modern experts call "marginal values," because he said that the last bushel, even if he sits as he eats, is the most profitable. Time changes and bacon tastes change with the times. To-day there is a marked preference for lean bacon instead of fat and the public taste now demands the less pungent form of cure, in contradistinction to the old forms of cure that were popular long ago. Not only has taste changed, but the market has expanded enormously, and it is true to say that, until the introduction of marketing schemes, the increase in the demand for pig meat was met almost entirely by in- creased importation from abroad. When the Irish supply fell off after the potato famine in 1847, the United States bacon got a footing in our market. Those were the days of the very pungent cure which enabled the bacon to travel from that distant source and reach our markets in an edible condition. With the change of taste in favour of the mild cure, the United States gradually lost that market to Continental suppliers, principally Denmark. Denmark during the 45-year period from 1881 to 1925 increased her pig population five-fold, and Holland in the same period doubled hers.

During this period, little or nothing was done to take advantage of the home market for British agriculture. Thirty years ago the output of bacon in Great Britain was 805,000 cwts., and in 1930 it was no more than 1,350,000 cwts., and that was only one-seventh of the total demand. Yet the pig industry has always been a very important branch of our agriculture. Before the War, the value of the output from pigs was almost as much as that from mutton and lamb, and it was more than that from potatoes or wheat, or barley, oats, poultry and eggs. After the War it became relatively more important, and its value exceeded that of mutton and lamb, or the whole of our grain crops put together. The truth seems to be that British production in those days concentrated itself on the relatively inelastic pork market, and almost abandoned the expanding bacon market to highly rationalised foreign competitors.

The bacon industry in this country did, indeed, survive, but in a somewhat haphazard fashion. Only the overflow from the pork market found its way into bacon, and then only when the pig cycle, from which every pig-producing country seems to suffer, rendered that course economically advisable to the producer. The result of that haphazard proceeding was that, in the first place, the supply of pigs for bacon became to a large extent dependent upon how much was left over from the pork market. The second result was that little effort was made to produce a bacon pig as such. This hand-to-mouth existence of the industry has reacted unfavourably, both on the pig producing and on the curing side of the industry. Lacking a rationalised curing industry and a safe place in the British market, there was little incentive to the British producer to produce a bacon pig as such. It is a little surprising that this should be so, because the strains which have been so scientifically developed abroad are, to a great extent, founded upon stock imported from this country.

As far as the curers are concerned, lacking the proper pig as they did, and a regular supply, they could not achieve the efficiency in large-scale production, and the economies which were within the power of their foreign competitors. Nor could they achieve adaptation to the changed taste of the public, and the change in taste was, indeed, largely the result of the foreign importation. The factories in this country worked to a little more than half of their capacity with consequent high costs. The cheaper and quicker process of curing bacon made little headway and the whole industry was in a very weak position to stand competition even of a normal character. But what was in store for the industry was not competition of a normal character. In the years 1929 to 1932 there ensued a scramble for this bacon market which threatened with disaster, not only the British producer, but the foreign competitor as well. In 1932 the importation rose to 12,000,000 cwts. or more than twice as much as it had been in the five-year period preceding the War. This pressure of foreign imports constituted a very formidable threat, not only to the pig industry in this country but to the industry abroad. Prices all round fell to ruinous levels and, had the situation been allowed to continue, there would have been a very serious recession in the home industry as well as in the industry abroad. The prices received by Danish producers during this period dropped from 15s. 10d. in 1929 to 7s. 4d. per score in 1933. Denmark in her own defence adopted drastic measures and reduced her pig population, and Holland followed suit.

Meanwhile, following the publication in 1926 and 1928 of the results of surveys made by the Ministry of Agriculture into the marketing of pigs, attention began to be focussed upon this hitherto neglected branch of the agricultural industry. The Pig Industry Council was formed, representing all sections of the industry. This was formed in 1928, and in 1932, following the passage of the Agricultural Marketing Act, the Re-organisation Commission was set up under the chairmanship of Lord Bingley, better known perhaps to hon. Members as Colonel Lane Fox. That Commission was appointed to prepare a scheme regulating the marketing of pigs and pig products. Marketing schemes which were passed on the recommendation of the Commission came into operation in 1933. They were not, in any sense, forced on the industry from without. They were initiated by the voluntary action of the producers under the powers conferred by the Agricultural Marketing Acts. These schemes rested on two essentials. One was the regulated supply of bacon from all sources, which was achieved by quantitative regulation under the Agricultural Marketing Act, 1933, and the second principle on which they rested was an orderly supply of home pigs fit to make good bacon. This was achieved by a system of annual contracts between producers and curers with higher payments and bonuses for pigs of the proper quality.

The Pig Marketing Board and the Bacon Marketing Board thus came into existence. The former represented the producers of pigs and the latter the curers. In this connection, I hope the House will allow me to refer to the loss which the industry has recently sustained by the sudden death of Mr. Marsh, the Chairman of the Bacon Marketing Board. In this country the voluntary organisation of the nation by trade unions, professions, and industries has developed until it has become part of our democratic structure, and the tasks and duties which this form of voluntary organisation casts upon those who lead them are of a very high and exacting character. All who knew Mr. Marsh will agree that he placed his great gifts and his knowledge of the industry freely at the disposal of his fellows, and that he will be sadly missed. That these schemes to which I have referred were on the right lines is shown by the results. The pig population increased by 40 per cent., the output of British bacon was doubled, and the quality of pigs improved greatly. In 1934 the number of grade A pigs contracted for was 789,000, and by 1936 that number had risen to about 1,500,000. Another beneficial result was that deliveries became more regular, and great progress began to be made with the tank curing process.

But experience has shown the existence of certain problems still outstanding which render this Bill necessary. These problems led to the breakdown of the contracts in the Autumn of 1936. These may be briefly stated, though nearly every one of them by itself would furnish matter for a debate. In the first place, we have the problem of the dead weight of surplus curing capacity and of the large number of units of high cost and small turnover on the curing side of the industry. There are 791 establishments at present licensed for bacon curing. Of these, 490 are small curers, who can be left out of account, because their total output does not amount to 5 per cent. of the aggregate. The remaining 300 have a total capacity of 3,750,000 pigs per year, and the result is that on the average they work at about 60 per cent. of capacity, though the proportion, of course, varies greatly from factory to factory. Of these 300 factories, only 20 can handle over 'moo pigs a week, 32 can handle from 500 to 1,000, 75 can handle from no to 500, and the remainder handle less than 100 pigs a week. By comparison, I would ask the House to consider the case of Denmark, which, of course, specialises for the export trade and is in a more favourable position on that account, but in that great bacon-producing country there are only 80 or 90 factories all told, and the average capacity of those factories is about 2,000 pigs per week. That comparison will enable the House to see what a difficulty is caused by the situation that I have mentioned.

The effect of this surplus capacity upon the contract system was deep-rooted. The problem of obtaining an economic throughput in relation to the capacity led curers, in the first place, to stipulate for a minimum quantity of pigs in the contracts, and no attempt was made to regulate the flow of pigs into bacon according to the total pig supply available; and though it was frequently alleged that farmers had failed to respond to the contract system, in fact more pigs were offered on annual bacon contracts than the available supplies of pigs justified. This in the end caused the pork market to be more attractive to producers than the bacon pig market. Another difficulty was the uneven distribution of pigs among curers. Some curers were very well supplied, others indifferently, while some could get no contracts at all. Accordingly, permission was given to curers to buy in the open market. In 1936, for example, the number of pigs taken off the open market by curers was 20 per cent. of the number delivered under contract, and the cumulative result was that non-contracting producers got better prices for their pigs than the contract price, and confidence in the contracts was, therefore, severely shaken.

To add to these difficulties, in 1936 the price of feeding stuffs began to rise very sharply. In July, 1936, the standard ration was 7s. 5d. per cwt.; by the end of the year it had risen to 9s. 1d., and it was still rising. In view of these disheartening and adverse circumstances, it is really remarkable that as many as 1,900,000 pigs were in fact offered on long contracts by producers for 1937, but the Bacon Board had stipulated, as they were fully entitled to do, for 2,200,000, and on the failure of producers to produce this number of pigs they declared the contracts void, and curers since then have had to buy in the open market at enhanced prices. In fairness to the farmers, I would point out that they could not have supplied, in my judgment, even the 1,900,000 without considerable loss, if feeding stuffs continued to rise. They averaged 10s. 1½d, for 1937, and during 1938 they have so far averaged 10s. 4d. These higher costs of feeding stuffs had their inevitable result in a decline of the pig population at home and abroad. The June returns for 1937 showed a drop of 4 per cent. compared with the previous year; the December return revealed that breeding sows were 59,000, or 11½ per cent., fewer than two years before; and the March census indicates that the number of pigs over two months old has dropped still further; but there are encouraging signs that the numbers of breeding sows and young pigs are increasing. This may with great probability be put down to the fact that the industry has been aware that the Government are considering plans for its assistance, and this heartening increase may be due, as I hope and believe it is, to returning confidence. The rise in the cost of feeding stuffs had its effects also in Denmark and Holland, where the pie population in 1937 fell by 15 and 16 per cent. respectively.

I hope I have not wearied the House by this historical recital, but it has been necessary to show the background of the proposals which are now being brought before the House. As I announced to the House in July last, the Government gave careful consideration to the circumstances which had arisen. They recognised the difficulties under which the industry was labouring because of the increase in pig feeding prices and costs, but they nevertheless believed that the industry was inherently economic and that if it could be founded on a smaller number of efficient factories, provided with an adequate and regular supply of pigs of proper type and quality, sufficient economies could be secured to enable the industry to be maintained during periods of high feeding-stuff prices. Some hon. Members may be inclined to think that rationalisation is an efficiency measure which an organised industry should be capable of carrying out itself, and I agree, provided that it is armed with the necessary powers; and, as I have already made clear, the bacon-producing side of the industry has made impressive progress in efficiency as well as output. Marked progress has been made in such matters as quality and to a less extent in standardisation of bacon and efficiency of plant; and on the pig-producing side also improvement has taken place in the type of pigs and in the regularity of production.

Nor has the problem of rationalisation been ignored. Marketing schemes were followed in 1935 by the bacon development scheme, which set up a board consisting of representatives of pig producers and curers, with independent members, and the task of this board was to coordinate the industry, to improve the efficiency of bacon manufacture and to regulate the extension of capacity. But the Development Board had but limited power for the first two years, and it is clear that now the powers of the board are inadequate to tackle the problem. Further, it would be hopeless to expect the bacon industry to achieve rationalisation in face of a falling output. The first essential, if rationalisation is to succeed, is the maintenance of an adequate and steady supply of pigs. The rise in the cost of feeding-stuffs is due to world causes which are outside the powers of the industry to remedy. If high feeding costs persist bacon production will continue to go down both here and in other countries, and the prices of bacon and pork will go up. This combination of a declining supply of raw material and of redundant factory capacity would pro- duce difficult conditions for any industry, I do not care what it is.

For these reasons the Government concluded that if the industry was to be put on a self-sufficient basis, as they believe it can be put, some assistance is necessary during the period in which these temporary difficulties are being overcome. The object in view is one which is well worth achieving. The value of the output of pigs in England and Wales is only a little less than that of cattle, and a serious setback in an industry of this size and importance would be a calamity. After all, pig production is very well suited to our soil and climate. Moreover the pig is a valuable source of fats, and with other livestock it plays its part as a factor in land fertility. Another feature should commend it to the interest of the House in that it is particularly suited for production by small producers, who are enabled often to use foodstuffs or grain for which otherwise they could not find a profitable outlet.

The condition of assistance must be the assurance that efficiency measures will be put in hand. It was with this object that, following my statement of last July, conversations and negotiations with the two marketing boards were begun. I here gladly pay tribute to the accommodating spirit shown by both sides of the industry. As a result of these negotiations the Government were assured that rationalisation would proceed, and the present Bill, which provides both for assistance in reestablishing the contract system and for the powers necessary for rationalisation, is the result.

The Bill is admittedly a complicated structure, and if some of its features are novel the House will consider them more closely in Committee. But I think that the intricacies may appear less confusing if I lay emphasis on two points. The first is that we are not writing on a clean slate. We have the organisations of the pigs and bacon marketing boards already in existence. The Development Board was brought into existence to initiate important reforms, and we propose to increase its jurisdiction and strengthen its hands so that these reforms shall be carried out. We have the machinery of the Agricultural Marketing Acts at our disposal, and in particular the Committee of Investigation for the protection of the public interest and of the interest of all the various bodies affected by the schemes. The Government believe that progress can best be assured by adapting those forms of organisation with which the industry is already familiar, and we hope to cure the defects which experience has shown to exist in them. We are heartened by the progress which these boards have brought about in the pig industry in the past, and if the difficulties can be removed, we believe that more progress will be made in the future.

Secondly, the Bill is based on the same principles as those which this House, in its wisdom, has adopted in respect of other commodities. We are not only giving assistance to the industry, but assistance with a definite object, and with safeguards that the money provided is properly applied according to the needs of the industry. The keynote of the Bill is efficiency. As a parallel to this insistence on an efficient industry I would draw attention to the Sugar Industry (Reorganisation) Act and the economies secured by the amalgamation of the sugar factories into a single corporation; to the improvement of the system of livestock markets and the experiments in central slaughtering under the Livestock Industry Act of 1937; and the intention which has been announced with regard to milk, to incorporate proposals for reducing the cost of milk distribution by legislation this Session. The Bill lays no less emphasis upon efficiency in pig production than in bacon production. There is a Clause in the Bill which enables the industry to finance research and experiment to secure efficiency in both branches of the industry, and we believe that that will be in the permanent interest of the industry itself. These provisions which lay emphasis on quality production through the grading of bacon pigs and carcases correspond with similar provisions in the Livestock Industry Act.

The Bill may appear to be a formidable document in its dimensions, but a great deal of its size is accounted for by the fact that there are incorporated in the Bill, with or without adaptation, many provisions which now appear in the Agricultural Marketing Schemes. This is necessary under the more permanent organisation proposed. So the amount of new matter in the Bill must not be gauged by the bulk. Hon. Members will see that the Bill is divided into parts. Part I deals with the changes in the organisation of the structure of the industry which are necessary to give effect to this policy. As I have explained, there is now in existence a Development Board set up under the Bacon Development Scheme of 1935. The present Development Board is concerned with the organisation of bacon production, that is to say, with the licensing of bacon factories and with measures to ensure efficient curing. It has no general power to coordinate the industry as a whole, since the marketing boards within their own particular spheres were to be more or less watertight compartments.

In my view it is essential that we should have a common and continuous policy from the production of the pigs to the sale of the bacon. It is accordingly proposed to replace the present Development Board by a stronger board having a larger impartial element. The number of independent members is to be increased from three to five, each of the marketing boards contributing four. The Development Board will be given wider powers of control over the whole industry. The marketing boards are to be retained and will in fact be responsible as administrative agents in carrying out the policy of the Development Board. In certain cases they will act independently. The Pigs Marketing Board, for example, retains the right to prescribe on behalf of registered producers terms and prices on which producers are to sell pigs under long contracts, provided it does so not later than 14 weeks from the commencement of the contract. Provision is made for the transfer to the Development Board of any functions of a marketing board which the latter has failed to exercise properly, and for the voluntary surrender of powers by a marketing board to the Development Board. If a marketing scheme is revoked the functions of the board will be transferred to the Development Board.

Part II of the Bill deals with the machinery for bringing a rationalisation scheme into force. The whole plan for the future organisation of the industry rests upon an effective scheme of rationalisation being brought into force and operated, and wide enabling powers are accordingly provided in the Bill for this purpose. It will be noted that under Clause 14 there can be no compulsory acquisition of factories without compensation. A factory rationalisation scheme will require very careful thought and preparation. In our view such a scheme is best submitted by the industry itself, which is familiar with its own trade conditions. The scheme may affect many people. Therefore there must be full opportunity for those affected by it to discuss it and to see how it affects their own interests, in order that in its completed form the scheme will be one that is just. The machinery laid down in the Agricultural Marketing Act, 1931, has been adopted for the submission and approval of these schemes. We think that that is the best way by which the objects, subject to the safeguards, can be obtained. The Bacon Marketing Board, as representing the curers who will be governed by a rationalisation scheme, will have the first right of submitting their proposals. If this right is not exercised, the Development Board may submit a scheme. When a rationalisation scheme is submitted to the Minister he must give notice in the usual way, an opportunity will be given for a full consideration of objections and representations, including a public inquiry.

Mr. A. V. Alexander

Before the right hon. Gentleman passes from rationalisation will he tell us exactly what is the intention of Clause II, Sub-section (4), with regard to the surrender and re-issue in certain cases of licences, and the provision for compensation? Is there a price upon the surrender of a licence?

Mr. Morrison

The Clause as a whole deals with the operation of licences and with penalties for breach of a licence, and Sub-section (4) provides that the holder of a licence may at any time surrender it to the board, and if that happens the board may issue a new licence with new conditions. They may make these conditions such as will help to bring the rationalisation scheme of a particular district into being. It is a question of the alteration of the conditions in a particular case. That is a necessary power which would enable the rationalisation scheme to be perfected. Before submitting a scheme to Parliament the Minister has to show the draft to the Bacon Marketing Board. I am assuming here that the board is not making the scheme. If the board do not approve the scheme, the scheme lapses, and no further action with regard to that particular draft can be taken.

We attach the utmost importance to an effective plan of rationalisation and we have been assured that such will take place. A Committee of the Bacon Marketing Board, of which my hon. and learned Friend the Member for Ashford (Mr. Spens) has been good enough to take the chair, is now actually at work drawing up a scheme with a view to submitting it immediately on the passing of this Bill. The costs of effecting rationalisation will be payable by licensed curers, except those holding small curers' licences, who will not be affected by the scheme. When a factory rationalisation scheme comes into force the public safeguards provided by Section 9 of the Agricultural Marketing Act, 1931 (Consumers' Committees and Committees of Investigation) will apply to it with certain adaptations. A special safeguard is provided for curers who are affected by a rationalisation scheme.

Part III of the Bill deals with the licensing of factories. The necessity for a licensing system and for the refusal of new licences on specified grounds was recognised by this House when it approved the Development Scheme of 1935. But the present Development Board, set up under that scheme, has not sufficient powers to tackle comprehensively the problem of rationalisation. The necessary powers are therefore provided in the Bill, and other reasons for the refusal of a licence or modifications of one to meet the necessities of rationalisation are included.

I would like to say a word about the small curers. When the Government policy was announced last July some anxiety was expressed by organisations of small curers that they would not be able to attain the increased standards of efficiency and equipment and that their businesses might run the risk of compulsory closure. There is no intention of bringing the small man within the reorganisation provisions. The small curer is one whose output in any four consecutive weeks does not exceed 60 cwts. of bacon. May I call attention to Clause 14 which provides for the revocation of producers' licences under the rationalisation scheme? I am not satisfied on a reconsideration of the wording of that Clause that it indicates that the small producer will in no circumstances have his business closed down, but I will look into it further and will accept an Amendment, or will put one down, to make sure that the small curer runs no risk of having his business closed down under a rationalisation scheme.

Curers who come within the small curers' class are excluded from the whole scheme of regulation. They can buy pigs where they like, their sales of bacon will not be controlled by quotas, and they will not come within any rationalisation scheme. They will not be subject to efficiency measures. They must be licensed with the Development Board, but the only conditions that can be attached to their licences are those requiring a certain standard of hygiene in the manufacture of bacon. Since they will not come within the long contract system, subsidy will not be payable in respect either of the pigs they buy or the bacon they produce. They will be required to contribute to the expenses of the Development Board and the Bacon Marketing Board, but on a considerably lower scale than other curers.

The bacon marketing scheme now in existence recognises and exempts from the scheme another still smaller class of curers consisting of those whose output does not exceed five cwts. per week. They are mostly retailers. It is not intended to depart from this practice and I am considering the terms of an Amendment to make it clear that no producer of bacon need be licensed provided he complies with the quantitative limit and other conditions of paragraph 22 of the present scheme, suitably adapted to fit in with this Bill.

Mr. Holdsworth

Suppose a small man finds his business is increasing and that his output is going up above the limit, what will happen to him then?

Mr. Morrison

It depends upon the conditions. If a small curer finds his business growing and he wishes to come into the class of larger curers, he will apply for a licence to the Development Board and become a licensed curer.

Mr. Holdsworth

If the licence is granted.

Mr. Morrison

Certainly.

Mr. Alexander

Quite apart from the question of licensing in the higher category, if a man in such cases buys all his pigs in the open market and does not get the subsidy on the long contract system, what is there to stop him from going above the maximum figure of 60 cwts.? I can find nothing in the Bill to prevent that.

Mr. Morrison

If it goes above the limit he must have the conditions attached to his licence which a curer of that capacity will have.

Mr. Alexander

Is he then free to buy pigs in the open market up to 60 cwts., and must apply for a licence above that amount in respect of which he must buy contract pigs?

Mr. Morrison

The small man with an output up to 60 cwts. buys his pigs in the open market, and consequently there is no subsidy attached. If, on the other hand, he decides that his business is growing so as, in his judgment, to make him a curer of the higher category, he then goes into that category and pigs will be supplied to him under the long contract, the financial provisions of which I am coming to shortly. In that respect he will be in the position of an ordinary curer licensed under this Bill.

The supply of pigs to the factories is a most important element in a successful bacon industry. We have found in the past that the system of annual contracts is the best way of regulating the supply. It is proposed, therefore, to resuscitate the system of annual contracts, but in order to avoid the rigidity which contributed to the breakdown of the system in 1936 the Development Board is to be empowered to permit pigs to be purchased by curers, under control and by approved methods, outside that system. The industry is, however, united in its determination not to permit the recurrence of those uncontrolled market purchases which undermined producers' confidence in the contract system.

The Bill provides that any general exemption from the contract system should be subject to the consent of the Minister. This additional check is proposed both to secure stability to the pig industry as a whole and to facilitate the regulation of bacon supplies to which both home supplies and imports contribute. The Bill provides that contracts shall be made through the Pigs Marketing Board. In this way it is intended to arrange for the distribution of pigs among curers in some equitable manner while preserving, as far as possible, existing links between pro- ducers and particular factories. Full consultations between the marketing boards will take place before the contract terms are prescribed and the Development Board will be kept informed of the progress of these negotiations.

The Pigs Marketing Board may prescribe the contract terms not later than 14 weeks before the contract is due to begin; during one further month they may prescribe the terms with the consent of the Bacon Marketing Board; but if the contract is not prescribed by 10 weeks before the due date the contract will be prescribed by the Development Board. This is to prevent, what had occurred in the past, a contract not being prescribed until close on the date it was due to begin. This was the result of protracted negotiations between the marketing boards. This system will provide a time-table which will give every one due notice. The Bill will enable the system of group contracting to be revised. This will be a help to the small man who himself might not be able to maintain the regularity of deliveries required by the curer, but by joining with other small producers deliveries may be maintained by the group as a whole.

It will be the concern of the Development Board to see that a reasonable balance is maintained between the pork and bacon markets. By means of periodical censuses of pigs which the Development Board will have power to take, the board will be able to form a reliable estimate of the number of pigs that should be available for bacon manufacture in any given period without upsetting pork supplies.

Clauses 22 to 25 contain the general financial provisions. Assistance will be limited to a period of three years and will take the form of compensating pig producers for any rise in the price of feeding stuffs above a certain level. It will also take the form of payments to curers to enable them to maintain payments of fixed prices to pig producers when bacon prices fall below specified levels. When conditions work the other way, that is, when food costs fall below or when pig prices rise above the specified levels, the industry concerned will make recoupment to the Exchequer. Curers will be required to pay an average price for the first contract period of 12s. 6d. a score in respect of the standard pig. This price should enable producers of reasonable efficiency to work at a profit under existing conditions. There is, however, little use in requiring curers to pay fixed prices for pigs without regard to the price of bacon, and it is believed that under present conditions a reasonably efficient curer should be able to pay a pig price of 12s. 6d. a score when he is receiving 94s. 9d. per cwt. for his bacon. That price will be taken as the bacon price yardstick for the purpose of payments to and by the curers in the first year. The House will realise that these figures of 12s. 6d. and 94s. 9d. are arithmetical figures and that it is the relation between them which is important, and not their particular amounts.

Economies will be demanded of pig producers and curers for the second year. The pig price will be reduced to 12s. 5d. per score and the bacon price yardstick to 93s. 9d. per cwt. In the third year further economies will be demanded and the pig price will be reduced to 12s. 3d. per score and the bacon price yardstick to 91s. 9d. per cwt. Assistance from the Exchequer to pig producers will be in respect of costs of feeding stuffs. A standard feeding-stuffs ration will be prescribed by the Minister. When the cost of this ration is 8s. 6d. a cwt., no payment will be made. For every shilling rise in the price above 8s. 6d. pig producers will receive 10.3d. per score. When the cost of the ration falls below 8s. 6d. pig producers will make recoupment on the same basis. The curer will be required to pay to the pig producer the additional sums represented by increased cost of feeding stuff, and in respect of the pigs which he satisfies the Minister he has turned into bacon he will receive payment from the Exchequer. When sums are due from the pig producer the curer will deduct them from the pig price and repay the Exchequer. The number of pigs which may in the first three years be sold on annual contract will be limited to the number on which assistance will be payable, namely, 2,100,000 in the first year, 2,400,000 in the second year, and 2,500,000 in the third year.

Part V deals with the fixation of production and selling quotas of curers. Some equitable distribution of the available supplies of pigs is inseparable from any rationalisation scheme devised to remedy the existing redundant factory capacity. The principles on which quotas and pigs are to be distributed among curers will be for the Development Board to consider. Part VI contains general provisions. The general safeguards are contained in Clause 29. These are on lines with which the House is already familiar as they were originally provided in Section 9 of the Agricultural Marketing Act, 1931. In this part of the Bill are contained the machinery provisions dealing with the marking of carcases, the grading of bacon, power of the board to obtain information, and so on. Clause 37 is the one to which I have referred, which provides for the encouragement of research and education. It is proposed that the Development Board should submit annually a programme for carrying out a scheme of research and education in connection with the production and marketing of pigs and bacon. This is highly important work in connection with the rationalisation scheme which aims at placing the industry on a much sounder basis.

To suns up, the reorganisation proposals fall into three main divisions: first, the reintroduction of the contract system, second, the rationalisation of the factories; third, research and education. The original schemes were not imposed by the Government upon the industry; they came into operation on the initiative of the industry, the Government only undertaking certain action to facilitate producers' plans. So now, the proposals in this Bill are not being imposed upon the industry. They are, in the main, proposals worked out by and agreed by the elected representatives of bacon curers and bacon producers, in which both sides have made concessions, each to the other. In the case of the original schemes the assistance offered by the Government took the form of import regulation, which was an integral part of the plan. The difficulties now confronting the industry are of a temporary character, and, therefore, the further Government assistance now proposed is also temporary. As regards bacon manufacture, it is the structure of the industry which is at fault, and which, while the present defects remain, is the bar to rapid increase in efficiency and economical production. Those structural defects are due very largely to the excessive capacity of the industry, having regard not only to the existing pig population, but to any pig population which might reasonably be expected within a period of years, and also to the demand for home-produced bacon.

Let me repeat that Parliament is not being asked to regiment this industry, but to establish conditions within which the industry can develop and can create an assured future for itself, with efficient service to the community. There is no inherent reason, after all, why pig production and bacon manufacture should be uneconomic in this country, or less economic than in other countries. The need is for a concerted effort on the part of pig producers and bacon curers, working together and not at cross purposes, to eliminate waste and inefficiency at every stage of production, processing and marketing. Only then will the bacon industry of this country make any progress in its transition from a comparatively small-scale industry supplying a one-time luxury market to a large-scale factory industry engaged in the mass production of a standardised and popular form of food.

Hon. and right hon. Gentlemen opposite have placed upon the Order Paper an Amendment which expresses certain dubieties about the merits of this proposal. I do not propose to anticipate how they will develop their arguments, but I note with gratitude that the Amendment recognises the necessity for a reorganisation of the bacon industry. It is true that in this Amendment the native hue of resolution is sicklied o'er with the pale cast of thought, and that the Amendment proceeds, as I gather it, to make certain points of criticism. The first is that the proposals exclude an important part of the industry. If, as on first reading the Amendment one would suppose, the objections of hon. Members opposite are to our proposal to leave out small curers, I think our course is abundantly justified. If, on the other hand, as I imagine the Amendment means, they object to the lack of control over the pork market, I would ask them to consider Clause 17. It is clear that the more pigs there are taken out of the pork market for bacon the higher that market tends to go. The control of open market buying of bacon implies some indirect control of the pork market, and this is provided for in Clause 17. In so far as the Amendment asserts that it is necessary to maintain parity between two markets, I am in agreement with it, but not if it asserts that that is not provided for in the Bill.

The second point about which hon. Members seem to be alarmed is that this Bill is designed to ensure high prices for bacon. That, I must confess, is an odd description of a Bill which is making deliberate provision for the contingency of bacon prices falling below 94s. 9d. per cwt. Bacon is now 113s. per cwt., and when hon. Members opposite were in office in the corresponding week in April, 1930, the price of Danish bacon was 117s. I hope the House will not hark back to the slump period with which I have dealt, a period which, without any inducement on our part, led to deliberate measures on the part of exporting countries to restrict production. If we deny the producer his just reward, he takes his very unwilling revenge in creating scarcity, because he can no longer in those circumstances produce and live. This Bill is designed to improve both the industrial and the agricultural sides of the industry. We hope that at the end of the period which it contemplates the production of pigs and the curing of bacon will have greatly improved, so that this country may be the richer by a bacon industry second to none in efficiency and prosperity.

4.36 p.m.

Mr. T. Williams

I beg to move, to leave out from the word "That," to the end of the Question, and to add instead thereof: this House recognises the necessity for a reorganisation of the bacon industry, but regrets that the proposals to this end exclude an important part of the industry, and, whilst involving the State in further subsidies, are designed to ensure high prices by restricting supply far below the quantity required for normal consumption, instead of planning an abundant supply under conditions which will enable all sections of the community to benefit. Recently a right hon. Friend of mine moved an Amendment and, because he devoted so little time to explaining it, was chastised by the Prime Minister and by subsequent speakers from the Treasury Bench. I shall not make that mistake, because I propose to make some reference to the Amendment at the outset. As has been the case with many other Government Bills which have been introduced in order to help agriculture during the past six or seven years, the intentions of some parts of the Bill appear to be good, but it is a weak and timid Measure and the right hon. Gentleman, like his predecessor, appears to be willing to bark but afraid to bite when vested interests stand in the way of real, true, lasting organisation. After the last five years' experience I must confess to some disappointment with the right hon. Gentleman. I thought that he, representing agriculture, setting aside all other considerations, might have done something much bigger, much more radical and much more lasting than we think this Measure will achieve. Had it not been for his predecessor's undying faith in private enterprise there would have been no necessity for this Measure at all. If the recommendations of the Reorganisation Commission of 1932 had been faithfully carried out, we should not have required a Bill to-day. There would have been complete rationalisation of the curing industry, the breakdown in 1936 would not have taken place, and we should, I believe, have established a substantial and successful bacon-producing industry. It is true that the Bill does foreshadow some organisation, but it may come to-morrow, the day after, sometime or never. After our experience of the past five years I am afraid that it may be never.

As usual with an agricultural Measure, the Bill provides some financial guarantee, but for bacon consumers it represents the last hole in the belt. Clause 27 is still the old nigger in the wood pile, and for that if for no other reason I can have little or no faith in a Measure which while pretending to reorganise relies so much on the simple power to restrict imports. Not even Clause 43, the fair wages clause for employés, which, of course, we welcome, would encourage us to support this Measure, which not only segregates pork from any effective control but relies upon restrictions, and to the extent that the right hon. Gentleman's hopes and expectations are realised the best we can hope for is the establishment of a permanent, profit-making, statutory monopoly of curers in this country. In other words, we are to place a high premium upon inefficiency in curing, as the right hon. Gentleman has recognised several times during his speech this afternoon. I could find a new title for this Bill if one were required—a Possible Rationalisation. Stabilisation and Subsidisation and a Certain Import Restriction Bill. I think that would fit the position much better than the present title. The taxpayers and consumers have cause to complain that there is no need for this Bill, and I hope to give my reasons for that observation.

I have one or two questions to put to the right hon. Gentleman. Part I of the Bill establishes a new Bacon Development Board, with increased powers. So far as they have powers and exercise them effectively, to that extent, perhaps, we should not disagree, apart from the creation of a statutory profit-making monopoly. Are we to understand that the one Development Board is to act for England and Scotland jointly, and that there is to be no separate board for Scotland The right hon. Gentleman will know far better than I do that the systems of killing, curing and transport in Scotland are very different from those in England. I believe that all pigs killed in Scotland are skinned at the outset. The skin is used as the basis for a very fine leather. To what extent is the Development Board going to affect that peculiar interest and the peculiar methods of the Scottish curing trade? I understand that Scotsmen are much more humane in the matter of slaughtering pigs, because all pigs are slaughtered at the point of production. They are not sent on those long journeys on which pigs have been known to ravage each other, causing serious injuries. I should like the right hon. Gentleman's colleague the Minister of Pensions to tell us when he replies what arrangements, if any, are to be made for the Scottish curers, seeing that their methods of slaughter are so very different.

Under Sub-section (3, a) of Clause 9 small curers, those who cure no more than 39 tons of bacon per annum, are to be excluded altogether from the scheme, except that they will be called upon to make a contribution to the expenses of the Development Board. I want to know whether the right hon. Gentleman feels that there is any danger of that large number of so-called small producers upsetting finally the balance of the scheme. That has happened in the past and it may very well happen in the future. Are all those small producers to remain for ever beyond the pale of any rationalization scheme? If so, there is going to be a rake's progress so far as rationalisation is concerned. I think something more might be said on that subject by the Minister of Pensions.

I also want to know what exactly Clause 24 means. As I read Sub-section (2), in certain circumstances, if the price of bacon is beyond 94s. 9d. and the food ration is less than 8s. 6d., the curer has to make a payment to the Treasury. Suppose the two sets of figures remain as determined here for a fairly long period of time; is it not possible for the Government to make a profit out of this Bill? I may be wrong in my calculations but, as I read the Measure, if the price of bacon exceeds 94s. 9d., and the cost of the specified ration is 8s. 6d. or less for a goodly period of time, the curer has to make a constant payment to the Treasury for each pig. The Government can then make a profit out of this Measure by the simple process of restricting imports to a certain point where the price will always be above 94s. 9d., and where the income of the Government would be perpetual. That would be a very different story from the expenditure of £1,000,000 visualised in this Clause. I hope that the Minister of Pensions will tell us something about that possibility later.

I am sure that the House will be interested to hear a dissertation, or description, or clarifying statement in regard to Sub-section (3) of Clause 24. I noticed that the right hon. Gentleman, in a very interesting speech, clear from beginning to end, avoided any explanation of the Sub-section. Perhaps if I were to read the Sub-section hon. Members might understand it at a first hearing: No amount shall be payable in respect of any pig under paragraph (a) of Sub-section (1), or paragraph (a) of Sub-section (2), of this Section, unless bacon has been produced from the pig on premises in respect of which a producer's licence, other than a small curer's licence, is in force, and where the weight of the bacon produced on such premises from a pig is less than four-fifths of the dead weight thereof, any amount payable under either of those paragraphs shall be reduced by applying thereto a fraction the numerator whereof is the number of pounds comprised in the weight of the bacon produced and the denominator whereof is the number of pounds comprised in four-fifths of the dead weight of the pig. I am sure that that is crystal clear. Unfortunately I am not too clear about it, and perhaps the Minister of Pensions will fill in the breach left by the right hon. Gentleman.

The right hon. Gentleman gave us a history of the pig and bacon industries of this country. I also wish to indulge in a wee bit of history, either from 1913 or from 1933, as the case may be. There was a Reorganisation Commission in 1932. Unfortunately, the Commission's major recommendations were more or less ignored, or there would have been no need for the Bill. It is no great joy to me to say, "I told you so. "I should have preferred that the industry from 1933 to 1938 had been on a really sound basis, and that the consumer had not been called upon to make unnecessary payments during the period. From 1913 to 1933, as the right hon. Gentleman states, two things stand out. We are one of the largest pig-meat consumers in the world and, notwithstanding the suitability of our soil and climate, the output in that period was more or less stationary. I do not think the farmer was wholly to blame. The circumstances were clearly explained by the Reorganisation Commission. The Pig Industry Council and the Commission told us why the individual farmer was not to blame. The former, representing pig producers, pointed to 15 weaknesses within the industry; superfluity of breeds and types, lack of efficiency in factories, irregular supply of pigs, fluctuating feed prices, no real organisation, and others, making pig and feed cycles inevitable. There was an ever-waiting market for an increased supply of bacon, but the bacon was not forthcoming from this country.

As the Commission pointed out on page II of their report, the individual producer was helpless to deal with the multiplicity of weaknesses in the industry, but they said: It is well within the power of organised industry to resolve those problems and to stabilise the bacon industry in this country. It is not merely a question of prices, because even in 1929, when the price was not 117s. per cwt. but 107s., we imported 8,250,000 cwts. of bacon while home produce was about 1,250,000 cwts. There was something fundamentally wrong with the industry, or that situation would not have existed. It is generally known and found to be proved that there is an almost unlimited demand for bacon in this country, if the prices are reasonable. If our home producers had been trying to use the specially suited soil and climate they could have had a ready-waiting market, but they simply could not do themselves justice. They were merely pig producers. They had nothing to do with curing, but were dependent upon factories as to whether or not they could make pig production a success.

Although we had a population of 45,000,000 in 1929, we had a pig population of 2,600,000, while Denmark, with a human population of 3,500,000, had a pig population of 3,700,000. They can not only produce pigs, cure them and send them overland and across the North Sea to this country, but they can sell their bacon in our market while our own producers have not yet found the way. I can explain that only by the two terms, co-operation and factory organisation. I know that those words involve lots of things, but this country, with its background of private enterprise, individual initiative and the profit-making system, prevents the sort of organisation which would have made the industry successful. It was not to be wondered at that in 1932, when we reached a peak of imports, something like 12,000,000 cwts. of bacon and ham for which there was a ready-waiting market —every new cwt. found new consumers and was absorbed as fast as it came in, as well as all the bacon that was produced at home—prices reached a record in low levels. We could not hope for all time to exploit either the British producer of pigs or the Danish producer. It must be remembered, as the Re-organisation Commission pointed out, that maize meal was down 41 per cent. at that time lower than the average between 1926 and 1929, so that if prices were low so were the ration prices. The poorer sections of the community in this country really were allowed for the first time to enjoy a goodly quantity of bacon.

From our own pig producers there was very naturally a demand for a duty or a subsidy, or anything that would give them a better price. I do not complain that the individual farmer demanded a subsidy or a restriction, or something that would lift the price of his produce, because he is the victim of circumstances over which he has no control. Unfortunately, the farmer himself does not know why. He has lived an individualistic life and he thinks, as the Government think, in terms of individualism, and not in terms of co-operation. Therefore, when he encounters a storm like that, be it a storm of imports or of feeding prices, or whatever it may be, the poor, miserable fellow must come to Parliament cap in hand. A commission was set up in response to the demand of the pig producers in this country, and they revealed the problem in all its complexity. Unfortunately, they compromised with themselves in their recommendations, because although they saw the problem clearly they hesitated to say the right thing. They hinted at what might be done. I will refer to this aspect of the matter later on.

They recommended that a Pigs Marketing Board, a Bacon Marketing Board, a Development Board, advisory committees, and so forth, should be set up. They thought that if we could stabilise supplies from all quarters, restrict imports, regulate home output, fix long-term contracts based on feeding prices—that is the object of the right hon. Gentleman now—rationalise factories, fix quotas for our factories with a maximum throughput and a minimum cost of production, we should be on the highway to success. Unfortunately, although there was a golden opportunity placed in the hands of the Government, the right hon. Gentleman's predecessor failed miserably. He was so satisfied in his belief in private enterprise and the profit-taking system, that the scheme was bound to break down after two or three years. I can remember the right hon. Gentleman when he stood at that Box with a vast army of Conservatives sitting behind him. When someone asked whether the pigs would be forthcoming he said: "Pigs? Why, pigs in millions are screaming at me all over the country." The Pied Piper of Hamelin had nothing on him, but if the pigs did come they only had a peep at the factories and then they raced off to the pork markets. They were not available last year for the bacon factories.

The Government have always been nervous of vested interests. It is our complaint here that they relied too much upon the simple process of restriction and that they had not sufficient courage to go forward to real organisation. Let us note what happened with regard to the imports of bacon from 1932 to the present year, excluding imports from Northern Ireland and pork imports turned into bacon here. In 1932, we imported 11,396,000 cwts., the following year 9,000,000 cwts., the next year 7,500,000 cwts., the next year 6,900,000 cwts., the next year 6,500,000 cwts. and last year 6,900,000 cwts. We paid £30,000,000 in 1932 for 11,396,000 cwts., but last year we paid £29,000,000 for 6,900,000 cwts., or nearly the same sum of money for 4,500,000 cwts. less. A question was put this afternoon to the right hon. Gentleman concerning potatoes. Who determines what is the reasonable price for potatoes? Not the Minister, not Parliament, but apparently the producers. The biggest producers are left to determine what is a reasonable price, so that in this case the curer, and, the consumer, has had to pay a hefty price for such part of the Government's policy as has been applied. The right hon. Gentleman said two or three times during his speech that the basic problem was the surplus factory capacity compared with the output of pigs in this country. I am sure, therefore, he will not disagree with me when I quote the following from page 54 of the report of the Reorganisation Commission: The costs of operating the bacon factories, as a whole, are unduly high, owing to the irregularity of supplies, to the excess of capacity over supplies in most factories, and to the excessive number and small average size of factories. The Commission also say, on page 56, of their Report: It is obvious that this excess of factory capacity relative to supplies of pigs is very wasteful. The following figures, which were supplied to us by a large English factory, compare actual feeding costs per hundredweight of bacon with estimated costs on the assumption of larger throughputs, and suggest that very important savings could be made by utilising factory capacity more fully. The figures quoted show that the cost per hundredweight of green bacon with an average kill of 684 pigs per week was 9s. 2d., but that the estimated cost assuming an average kill of 2,500 pigs per week was 5s. 1d., or a difference of 4s. 1d. per hundredweight. I believe that when the contract broke down in 1936 or early in 1937 the pig producer was demanding a certain price, and the consumer was offering another price, the margin being about 6d. per score. 1f 6d. per score could have been offered by the curers in excess of what was asked by the pig producers, the pig producers would have supplied pigs in much larger numbers. But here is a margin of 4s. per hundredweight for sheer factory rationalisation, and yet in five years nothing has been done. Why? On page 57 of their report the Commission tell us. They say: The average weekly throughput per factory is 350–400 carcases in the case of England and Wales, 40–50 in the case of Scotland, and 50–60 in the case of Northern Ireland. By contrast, the average weekly throughput of the Danish factories appears to be about 2,000 carcases. There is the real advantage of Denmark over Britain. Denmark does not necessarily produce better pigs, and it does not necessarily follow that Denmark can produce better pigs, if our own people had been encouraged to concentrate on the production of pigs; but Denmark has seen the wisdom of providing itself with the proper breed, the right type of factory, and the appropriate organisation, and so can compete very favourably with us in our own market and at the same time can pay better wages for labour in Denmark than our people are paid in this country. If the Government in 1933 had had the courage and foresight to see that rationalisation of the curing factories was carried out, instead of leaving it to the curers to rationalise themselves, there would have been no need for this Bill.

It is true that the right hon. Gentleman in his Bill gives slightly more power to the Development Board, but I do not see that Part II of the Bill is likely to go any long way beyond what has happened between 1933 and 1938. Let us see what the right hon. Gentleman does in Clause 6. This is a typical piece of hesitancy on the part of a Conservative Government. It says, first of all, that if the Bacon Marketing Board do not send in a rationalisation scheme within a month, the Development Board can step in and prepare a scheme, but if the Bacon Marketing Board send in a scheme within a month, the Development Board cannot do anything for 12 months. Therefore, if the Bacon Marketing Board send in a scheme in the fourth week of the first month, they need not do anything for the next 11 months and three weeks, nor need the Bacon Development Board either. These are the terms of the Bill. Then, when the Bacon Marketing Board send in their scheme after 11 months and three weeks, they send it to the Bacon Development Board, who have six weeks in which to examine the scheme. They then submit the scheme to the Minister, and the Minister lets the world know that the scheme is in existence. He waits for objections; he may cause an inquiry to be held; and then he must allow 28 days before anything really happens. By that time, of course, 18 or 20 months have expired, and no rationalisation scheme has come into existence. Even in Clauses 14 and 17 the right hon. Gentleman doubts whether any rationalisation scheme will be in existence in the first two years, for he says in Clauses 14 and 17 that, if the rationalisation scheme is not in existence within two years, certain things are to happen. He has no confidence in his own Bill. In any case it seems clear that Clause 6 not only gives the bacon curer time to provide himself with a rationalisation scheme, but gives him time to forget a scheme. In other words, it is fiddling with a really urgent problem. And this is six years after the Commission's report. For our part we should prefer to see the curing industry really rationalised, not by the curers themselves, but rationalised as the Commission hinted when, on page 21 of their report, they suggested the setting up of some form of corporation which would enter into and gradually absorb the home curing trade. That is to say, instead of allowing the curers to rationalist themselves out of existence—which of course they would never do unless they left themselves with a tight little permanent statutory monopoly—this rationalisation should be left in the hands of a public corporation. After all, the Minister of Agriculture is not the minister of bacon curing. He represents agriculture and agriculture alone, involving 45,000,000 or 46,000,000 consumers and 1,000,000 producers, and it ought to be his duty to see to it that anything and everything that can be done to make agriculture really prosperous should be done, even though vested interests have to be cast north, south, east and west. I do not see anything that need bar the Government from taking this step. If the curing of bacon was a service to agriculture and the nation, there is no doubt that we should get rationalisation. Then the curer would be able to pay a bigger price to the pig producer, and, with such assistance as the Government might give with regard to squaring out those peculiar intervals where pig feed prices go up and down, I have no doubt that we could establish a bacon industry on the Danish lines which would not only save much more than the subsidy, but, what is more important to me, would provide a larger quantity of bacon for willing consumers in this country without increasing the price.

That, really, is the point which we on these benches have in mind, and that is the sense of our Amendment. We do not like to see the industry divided, one part controlled and the other part not controlled. We have seen what has happened many times in the past. We agree with the right hon. Gentleman's intentions as to rationalisation, licensing, prolonging contracts, and fitting them into a proper scheme, with the appropriate arbitration possibilities on compensation questions, licence questions and so on. But we do not think that this is the sort of Bill which will do that. The Bill actually puts a premium on in efficiency in curing. The right hon. Gentleman admits that it does. He tells us how many factories there are and what their throughput is, and he knows very well that the curer is just as helpless an individual as the pig producer is in the matter of bargaining for a price when the throughput available for his factory is 50 per cent. of its capacity. Let me take a simple example from figures given by the Commission. They show that the average weekly supplies of bacon pigs in the years 1923 to 1929 in an English factory varied from 450 to 826. The overheads remain constant. How can a curer make an economic success of his factory under such conditions? The Commission also tell us that the average weekly supplies of pigs from January to December, 1929, varied from 260 to 731. How can any bacon curer cope with conditions of that kind?

Therefore, as I have said, a premium is put on the inefficiency in curing, and now it is proposed that the curers shall be allowed to rationalise themselves from 26o factories to the number they think they ought to retain, and, that having been done, to provide Government funds to enable farmers to send regular supplies of bacon pigs to maintain the maximum throughput and the maximum profit for all time—for those curers who remain in the industry will have that statutory monopoly, since no other factories will be allowed to be erected except with the consent of the Development Board, who will only give their consent if an increased number of pigs is likely to be available. We fear that this Bill will disregard the interests of the nation, as has happened in the past, and I hope that agricultural Members of the House who really have the interests of agriculture at heart, and who really feel for pig producers and farmers generally will go into the Lobby in support of the Amendment I am moving, believing that the national interests as regards pig production and efficient curing will not be advanced as a result of this Measure, but will only be advanced when real rationalisation takes place under a public corporation, where curing becomes a service to the farmer and a service to the State. It is for these reasons that I move the Amendment.

5.15 p.m.

Colonel Sir Edward Ruggles-Brise

The hon. Member for Don Valley (Mr. T. Williams) promised the House at the beginning of his remarks that he would not fall into the error committed by some of his colleagues in a recent Debate, when they omitted to speak to the terms of an Amendment which they had moved. It is true that the hon. Member did make a passing reference in his concluding remarks to the Amendment on the Paper, but he did not, in fact, make any reply to the two questions which my right hon. Friend the Minister of Agriculture asked him. I am still in the dark as to what exactly the Amendment means. It says that this House regrets that the proposals to this end exclude an important part of the industry. Does that refer to the smaller curers, or to the whole of the pork industry? I do not think the hon. Member made that clear, although he was asked a specific question by my right hon. Friend; nor did he go on to develop the argument set forth in the Amendment that this Bill will have the effect of increasing the price of bacon. It may be that one or other of his colleagues will supply the deficiency.

I think this Bill will receive a general welcome from the producers of pigs with regard to its main provisions, although in detail some of the provisions are open to criticism. It is intended that there shall be provided a basis on which the pig producers can work; that is, the provision of a formula which relates the cost of production to the price the producer gets for his finished product. Therein lies a degree of security for the producer in what is essentially a risky operation, as most of those in this House who have produced pigs well know. There arises the question as to whether the formula as it stands in the Bill is the correct formula. There may be a good deal of difference of opinion on that. It is obviously essential that that formula should be a correct one. I may refer later to the formula itself.

The second principle in the Bill is that such assistance as is promised is assured for a period: namely, three years. The hon. Member who has just sat down referred to that period. I think he indicated that in his view the period was too short. If that is so, I share his view. It is a mistake to make the period a short one, because all farming operations are long-term operations, and pig production is no exception to that general rule. Though the period of gestation of a pig is shorter than that of some other animals produced on the farm, the circumstances which surround pig production are in themselves long-term processes. For instance, a pig producer is obviously not going to spend a great deal of money on new housing or new equipment for pigs if he feels that there is no certainty after a short period like three years. If there were a longer period, he might say, "During that time there will be some opportunity for me to get back some return on the capital I have invested." If we take the question of producing the right type of pig, that again is a long-term operation. It is true that you can get a litter of pigs in a comparatively few weeks, but you cannot evolve the right type of pig except by a longer process, carried out over a period of years. Therefore, as far as production of pigs is concerned, we must consider that it is a long-term business, and that it requires a long-term policy. A period of at least five years would be more suitable.

The next point is the quota of pigs. Figures have been mentioned by the Minister, and are in the Bill. Therefore, I will not quote them again. But it is certainly the case, that, in view of the very great consumption of pigs in this country, the maximum number of pigs in the third year on the long contract amounts to no more than 2,500,000. I think that number is a too closely restrictive one. There may be a reaction in regard to the pork market by the operation of this quota. If the producers of pigs think that the terms of the Bill are very attractive, they may produce in excess of the quota laid down, with the result that there will be a surplus of pigs, and that this surplus will be thrown on the pork market, causing a glut, and a consequential fall in the price of pork. The desideratum to be aimed at is the establishment in the pig and pork market of a steady price in regard to the two classes of pigs. It may be that, by the restrictions in the Bill, we shall disturb the price of pork in the pork market. I understand, although I am not sure, that the hon. Gentleman who spoke from the Front Opposition Bench would have preferred—he did not explain—that this Bill should have embraced the whole of the pigs of the country. I think the hon. Gentleman acquiesces in that. My own view is that the Government are right in not interfering with the pork market at this stage by legislation. If I may talk in terms of pigs, the pork market question bristles with difficulties.

The fourth point to which I want to refer is that, under the aegis of the Bacon Development Board, there is to be research. That obviously is right, and it will be welcomed by all. As I understand it, the cost of research is to fall upon both the producers and the curers, although there is nothing in the Bill to say how it is to be apportioned between them. I dare say my hon. Friend, in replying, will be able to give us some enlightenment on that. I think that here the Government might possibly have allocated a sum, not necessarily a very great one, towards the cost of this research, because we know that research is costly and one may have to labour for years before results are achieved. I do not suppose it is possible to make any proposal on those lines in an Amendment, because it would increase the charge, but I regret that the Government did not allocate a definite sum. I do not know whether it is the intention of the Minister to appoint, as one of his appointed members, to the Development Board anyone who has had first-hand experience of the improvement of pig breeding. For instance, does the Minister intend to appoint as one of those nominated members a representative of the National Pig Breeders' Association? It might be reasonable for him to do so.

Mr. Alexander

Does the hon. and gallant Member consider that such a representative would be impartial?

Sir E. Ruggles-Brise

I think it is true that that organisation has more knowledge, as regards the breeding of pigs, than any other organisation. On that ground alone, I throw out the suggestion that its inclusion would be welcome. I am bound to say that with much that has been said in the hon. Member's criticism of the factories I find myself in agreement. There is no doubt that rationalisation of the factories is long overdue and that it will be generally welcomed. I share his fears that it may be postponed. I would like to see the rationalisation process put into operation much more quickly than is envisaged in this Bill. The producers of pigs have proved since 1932 that if they are given a chance they are capable of enormously expanding production, but the difficulty has always been that the factories themselves have to a large degree, though of course not universally, been unable to deal efficaciously with such pigs as they have had from the producers. This question of rationalisation lies at the root of a great many of the troubles of the industry. I rather hope that my right hon. Friend the Minister will be prepared to accept in Committee Amendments which will have the effect of speeding up the rationalisation of the factories.

I should like to ask a question relating to the descending scale of payments to be made to pig producers for the three long-contract periods. Is this descending scale of payments to pig producers to be made in connection with the cost of factory rationalisation? There is no provision at all in the Bill as to who is to pay for the cost of the factory rationalisation. My right hon. Friend said that the factories themselves were to meet the cost of their rationalisation, but the Bill does not say so, as far as I have been able to see. While it is laid down in the Bill that there is to be a descending scale of contract price to the pig producer and of contribution from the Exchequer to the factory, it appears that the whole of the cost to the factory will be passed on to the pig producer. I should like to know whether that is to be so or not. If that is to be the case, obviously the factories will suffer nothing by the fact that the Exchequer contribution to them is reduced, if they have been able to pass it all on to the producer. It is a very difficult sum to work out, and my arithmetic, I confess, has not been capable of answering the question.

I submit, in contradistinction to what the hon. Member said in his speech, that the regulation of imports, as provided for in Clause 27, is absolutely essential. The necessity for it must be abundantly clear. Over almost the whole field of home-produced agricultural produce in this country the home market is invaded by overseas supplies.

Mr. T. Williams

I hope that the hon. and gallant Gentleman does not misunderstand me. What I both said and implied throughout my speech was, that we did not attack the regulations in a really good case, but we objected to the Government exclusively relying upon the wholesale restriction of imports.

Sir E. Ruggles-Brise

I do not think that the hon. Gentleman can quite say that. He would argue, as I understand him, that, the Bill being tardy in bringing into operation the factory rationalisation, the Government are relying on erecting a barrier by means of the regulation of the industry, behind which the factories at their leisure may be organised. Have I interpreted the hon. Gentleman correctly? I do not think that that can be substantiated. I was really referring to the regulation of imports in general to all our home-produced agricultural products, and I was stating that it is the fact that our home market is invaded by overseas supplies in almost every commodity, with the possible exception of potatoes, and even there we have a few imports. We do not, and cannot produce 100 per cent. of our requirements for consumption in this country of more than a few agricultural commodities, and, therefore, speaking in general terms, our home market is being invaded.

I am not arguing whether the supplies are coming from Empire sources or from foreign sources. That is out of the question for the moment. Where you have a great food-consuming market, like our home market, invaded by overseas imports from whatever source, it is clear that there must be times when that market will be completely swamped and upset, and that the home producer can have no security in his own home market. Therefore, the regulation of imports is a matter of business for us as a nation, as we are compelled to buy a large part of our food from overseas, and we should conduct that buying upon a businesslike basis and try to regulate the flow of foodstuffs to this country by a reasonable measure of regulation of imports. That is the reason why I welcome the regulation of imports as provided in Clause 27 of the Bill.

The Exchequer contribution provided for in Clause 24 appears to be a contingent liability hinging on two factors (1) the price of feeding-stuffs and (2) the price of bacon. My right hon. Friend estimates the cost to the Exchequer to be about £1,000,000 a year, though that is, apparently, rather a rough guess. I can well understand that it will be almost impossible to get a very precise estimate until the whole scheme has been in operation for some time. I personally regret—and I think that there are many others in this House who will do the same—that the Government have not adopted the principle of the levy subsidy. It is a more scientific method, and I wish that the Government had taken the opportunity of applying it in this case. It has the great advantage that it would reduce the liability of the Exchequer, and to that extent would assist the taxpayer. I sincerely trust that, in any future legislation, the Government will revert to the policy of the levy subsidy wherever that policy may be found to be applicable. The principle of the levy subsidy is enshrined in the Wheat Act, which from practical experience we know has worked, and I would like to see that same principle applied mutatis mutandisto other plans which the Government may have in mind for the industry.

Mr. Alexander

Does the hon. and gallant Gentleman want that levy subsidy to be applied without any restrictions being placed upon it?

Sir E. Ruggles-Brise

No, I think that it might quite well be necessary to have a regulation of imports, for the reason I gave to the House, that you should try to ensure a steady flow of such foodstuffs as you are compelled to buy. But when one comes to supporting the industry, as this Bill now proposes to do, I suggest another way of doing it. There should be a levy made on the competitive imported article, and the proceeds of that levy should be applied to help the home producer and to ease the Exchequer.

Mr. Alexander

Do I understand that the suggestion of the hon. and gallant Gentleman is that you should maintain artificially high prices by the restriction of foreign imports, and then subsidise the home producer by the levy on restricted imports and pass the cost on to the consumer? Is that the suggestion?

Sir E. Ruggles-Brise

It is very difficult to draw a sharp line of distinction between the taxpayer and the consumer, and it would be out of place, obviously, to try and argue that now. The levy subsidy was accepted in principle in the White Paper issued by the Government in 1935, and I regret that the Government have abandoned that particular policy in favour of the one in the Bill. When we are passing a great Bill like this, of some 50 Clauses, we ought to go back to the origin of the Bill and all the things which have led up to it. The original Pigs Marketing Scheme was brought into being by the vote of the pig producers themselves under the aegis of the Agricultural Marketing Act, in order to try and give them some security in their business. This legislation is intended to support that theory, and to turn it more into practice. The purpose is, as my right hon. Friend said in his speech, that this country should produce a larger proportion of the pigs required for bacon, and that we should to that extent have to import a less quantity of bacon.

The question, therefore, is, Are the terms of this Bill such as will achieve this object and bring about a definite expansion of production of home-produced pigs? Does this Bill give the producer such an amount of reasonable security as to encourage him to launch forth and equip his housing and other ancillary requirements and increase his herds of pigs? The one determining factor as to whether he will do so or not is the relation which the price he is to receive for his finished article—the pig—bears to the cost of production. That is the govern- ing factor of the whole situation. If, therefore, the formula in the Bill should happen to be wrong, it is clear that the pig producer will not be encouraged to carry out the purposes of the Bill, namely, to increase the production of pigs and to allow this country to become more self-supporting in the matter of the supply of bacon.

This brings me to an analysis of the formula, which is, that there should be a basis of 8s. 6d. per cwt. as the cost of feeding stuffs. That is only for the first year of the three long contract periods. If you take the average which is to be received for the three years the amount will be reduced to 12s. 4⅔d. on the descending scale. That is the gross price which the pig producer is to receive. There are deductions which will have to be made from that price of 12s. 4⅔d. In accordance with the terms of the Bill, the Pigs Marketing Board will be able to make a deduction of 1s. 6d. per pig, and the Development Board is to receive a contribution from the pig producer. There is nothing in the Bill to limit the demands of the Development Board as to what it may charge to the pig producer on every pig. The approximate amount which the Development Board will have to demand in order to pay its own running expenses is not indicated in any way, but that board also is responsible for finding £50,000 for research.

Therefore, there will have to be a contribution made by the pig producer towards the cost of research. I admit that that cost is to be shared between the pig producer and the curer, though we do not know in what proportion. I do not think that I shall be overstating the case if I say that the ordinary running charge which will be made by the Development Board on the pig producer will not be less than 3d. per pig in all probability. Assuming that another 3d. per pig is levied in respect of the cost of research, that will make 6d. per pig, and that, added to the 1s. 6d. per pig which the Pigs Marketing Board under the Bill is allowed to charge, makes a total of 2s. to be deducted in respect of each pig.

There must be added to that deduction another 6d. at least in order to meet the cost of insurance of the pig against death, damage or loss of weight in transit. That is to be provided for under Clause 22. That will be not less than 6d. per pig. Therefore, we get a levy of approximately 2s. 6d. per pig deducted from the price that the pig producer will ultimately receive.

The whole question as to whether the formula is right depends largely upon the deductions which are to be made from the pig producer. On the basis of the producer selling an eight-score pig, the price per score will be reduced by just under 4d. Therefore, the net price that the producer will receive will not be 12s. 6d. per score as appears in the Bill, but approximately 12s. per score. I am trying to arrive at what the pig producer will receive. His net receipts are what is important, and not the gross figure. For the sake of argument we will say that the producer will receive a net price of 12s. per score, although I admit that some of the items in my calculation have been merely estimates.

The question is whether that price is right, whether 12s. a score on the basis of a cost of 8s. 6d. for feeding stuffs will bring about the large extension in the production of pigs that is desired and is intended by the Bill. Large-scale producers may possibly be able to operate on that figure. If they have good luck, large litters and low casualties, it may be that the formula will work satisfactorily, but the smaller producer finds his casualties a far bigger burden than does the large producer. The loss of one pig may not be a serious matter, viewed from the percentage point of view, in the case of a large producer, but the loss of one pig may be a very serious percentage in the herd of a small producer. I hope, therefore, that when my hon. Friend the Minister of Pensions replies he will be able to give us some assurance as to whether he and my right hon. Friend the Minister of Agriculture are satisfied that this net price is one that will be adequate for the producer.

In general, I wish the Bill well, and I think it will receive the general support of the House, even though I have thought it my duty to criticise some of its provisions. At a time like this when the policy of the country must be the increase of the fertility of the soil, it is clear that an increase in animal production must be on the right lines. Therefore, we have to attempt an increase in the production of pigs for bacon purposes, and the question will arise, how are we to keep it up in case of war? We are acutely conscious of the difficult problem of how we are to be assured of an adequate supply of feeding stuffs wherewith to feed our increased herd of pigs when we have them. I think my right hon. Friend the Minister has that point fully in mind, and I have no doubt that he will consider that the right way to ensure a greater amount of available feeding stuffs for the increased number of pigs will be to see that some of our land, perhaps border-land or second-class land, which has fallen down to rough grazing, is taken into account. If we can get that land brought back into production, so that at least it might provide feeding stuffs for our cattle and pigs, then the pigs will play their part in return, by giving back fertility to the soil, by means of the manure we shall get from them. I feel sure that my right hon. Friend has that problem in mind and I hope that the Bill will meet with the success that it deserves.

5.50 p.m.

Mr. Holdsworth

Before I left home this morning I had for breakfast a little bacon. I am certain that if the little pig from which that bacon came had known that 62 pages of a Bill were to be devoted to the subject of how to produce more pigs, the bacon would have curled up more than it did. Of all Ministers the Minister of Agriculture must feel most disheartened. He comes almost every week with a fresh present for the agricultural Members and he finds himself surrounded continually by a band of Oliver Twists, always asking for more. The hon. and gallant Member for Maldon (Sir E. Ruggles-Brise) complains that the Bill does not give him enough. He says that he knows they are going to get £1,000,000 in a year, but bacon production is a long job. He desires that the man should not only get a better price for his bacon, but one that will enable him to buy off his capital assets before the subsidy goes off.

The hon. and gallant Member contradicted himself. He said that the number of pigs to be subsidised was not big enough in the third year. In his first argument he suggested that the pigs might not be produced because the subsidy did not extend over a long enough period, but his second argument was a complete contradiction. He said the number was not big enough and that probably more pigs would be produced in the third year, and consequently they would not all be able to enjoy the subsidy. It is astounding, after all the help that agriculture has had from this House, that we should still find agricultural Members complaining of the inadequacy of the gifts extended to them. If one takes into account the allowance for rates, they have had more than £30,000,000 a year in subsidy. I could go into a great many more figures in answer to the hon. and gallant Member for Maldon, but I want to say a few words about the speech of the hon. Member for Don Valley (Mr. T. Williams). With a good deal of the speech of the hon. Member for Don Valley I was in thorough agreement. His complaint about the Bill is not that there is too much regulation but that there is not enough. There are 62 pages of it, but I think he wanted zoo pages of restrictions, and then he would be perfectly happy.

Mr. T. Williams

One page would be enough.

Mr. Holdsworth

I would ask the right hon. Member for Hillsborough (Mr. Alexander), who I assume will wind up the Debate to-night, to tell us whether he is prepared for the regulation of imports. The hon. Member for Don Valley said that his party were prepared to regulate imports on certain conditions. The right hon. Member for Hillsborough is a very striking ornament in the great Cooperative movement. I do not believe that there is any member of that Co-operative movement who has ever stated that they are prepared to support the regulation of imports. I wish the right hon. Gentleman would confirm or deny what the hon. Member for Don Valley said on that particular point, because we ought to have unity on this matter in the party above the Gangway.

There is one further point in the speech of the hon. Member for the Don Valley, in which he said that the trouble with this industry was that it was permeated by individual initiative and private enterprise. He cited the success of Denmark. Two or three years ago I took the trouble to spend a fortnight going round Denmark examining their bacon industry. It is purely voluntary, absolutely run by private enterprise. Every man is allowed to use his individual initiative. The astonishing thing to me about the bacon industry in this country is that we have better land here than they have in Denmark. It is not the case of Denmark sending goods into this country because they pay lower wages, because that is not true, nor is it the case that a man there can purchase his land more cheaply and that it enables him to produce more cheaply. It is because they have been wise enough to co-operate with one another in a voluntary way.

Mr. T. Williams

Did not the hon. Member discover when he went to Denmark that their individualism expresses itself in the best form of co-operative system there is in the world?

Mr. Holdsworth

I agree that private individualism is the thing when you allow it to work collectively but from the voluntary point of view. Then I have nothing whatever to say against it, but that is not what the hon. Member suggested. He said, "None of this business. Let us compel them to join." Do not let the hon. Member cite Denmark as being a splendid example of nationalism, when it is absolutely founded upon the voluntary system. I could not help thinking when I listened to the Minister of Agriculture, of the long Debates we had upstairs in 1933 when we were discussing the Agricultural Marketing Act. We spent weeks on that Bill. We were told that it was to enable marketing hoards to be set up, coupled with quota restrictions on imports. I remember an Amendment that I moved to ensure that before there was regulation of imports marketing boards should be instituted. I put down an Amendment that the marketing board should have been in existence a certain time before there was regulation of imports. That Amendment was defeated. I used at that time the argument that marketing boards were not really wanted but what was wanted was restriction of imports, and I think the speech of the hon. and gallant Member for Maldon—I do not want to misrepresent him—implied that what they were really concerned about was restriction of imports. The argument that was used at that time was that dearer prices would result because of inadequate protection for the consumer. I do not want to use a phrase which we all detest, but every word that I said has been justified. One reason why we are discussing this Bill is because the scheme has broken down. The Minister of Agriculture was pianissimo on that particular note.

The Bill has arisen because the previous Marketing Act completely failed to meet the needs, as far as the curers were concerned. In 1933 the right hon. Gentleman who is now the Minister of Transport made a remarkable speech, the most remarkable I have ever heard from him. I remember his marvellous Free Trade speech, in which he said that one of the great difficulties in the House was to convince hon. Members of the entirely new set of circumstances which confronted the world, namely—it was a new phrase to me—the economics of glut. After saying that in times of glut restriction was essential the hon. Member referred to me because on one Amendment I agreed with him, and he said: Alliance with such a quarter is indeed suspect. The alliance prior to 1931 had been rather long. One reason I mention this is because the glut has been stopped effectively by the regulation of imports and scarcity has been assured as the result. I am going to repeat some figures given by the hon. Member for Don Valley. The imports in 1932 were 11,395,000 cwts. at a cost of £30,189,000. In 1937 the imports were 6,925,000 cwts., at a cost of £29,289,000. In other words the cost was 53s. per cwt. in 1932 and 84s. 7d. per cwt. in 1937. In 1932 the import of hams was 801,000 cwts. at a cost of 68s. per cwt., a total amount of £2,723,000. In 1937 the imports had gone down to 675,000 cwts., but the money paid had increased from £2,723,000 to £3,158,000. In fact, with 15 per cent. less in weight we paid over £400,000 more for it. If for this increased price we had received in return a greater production in this country there might be something to be said for it; but that point cannot be made. There has been very little increase in the home production of bacon from 1932 to 1937. I believe the figures are an increase of 600,000 cwts., and when you compare that with the total amount of imports which have gone down, home production is hardly worth talking about.

Some time ago a petition was presented to this House relating to the cost of living. I am not suggesting that the 1932 price was a remunerative price for the producer, but I am suggesting that there is a remunerative price somewhere between the two, and that it is this artificial restriction which has driven up the price to what it is to-day. Reference was made by the Minister to the fact that the people of Denmark had reduced the quantity of bacon. Yes, they began to do so in 1932 when I was there, Out not because they wanted to reduce the quantity of bacon but because they aw that one market was to become a limited market.

Sir E. Ruggles-Brise

The one market which they themselves had glutted.

Mr. Holdsworth

I have yet to learn that it is a crime for people to try and sell a commodity cheaply, or that it is to be called glutting a market to enable poor people to buy cheap bacon. We do not buy Danish bacon because we love the Danes. We buy Danish bacon because it is of a standard quality at a reasonable price, and the consequence of all these restrictive measures is that bacon has largely disappeared from the working man's breakfast table. The working man cannot afford to buy it as a consequence of this kind of legislation. The scheme has broken down. What is the suggested remedy? The natural thing would be to scrap the scheme, but that is not the case here. There is no acknowledgment of defeat, no cancellation of import restrictions. No; instead we are going to add to the restrictions on foreign imports restrictions on home production. That is the cure of the Government. Look at Clause 26—I must take some little time to explain these things, because I am certain hon. Members opposite have no idea what is meant by the Bill. It says: The Bacon Marketing Board may from time to time determine—

1. (a) the descriptions of bacon which may be produced by any registered curer either generally or on any particular premises;
2. (b) the quantity of bacon of any, or of any specified, description which may be produced by any registered curer, either generally or on any particular premises;
3. (c) the descriptions of bacon, and the quantity of bacon of any, or any specified, description, which may be sold by any registered curer:

But hon. Members should also read Subsection (2) of the same Clause: If any registered curer produces or sells any bacon in contravention of any determination of the Bacon Marketing Board under this Section, that board shall … recover from him a monetary penalty not exceeding one hundred pounds or five pounds for each hundredweight of bacon so produced or sold, whichever is the larger. That is the Government's cure. It may be said that these are Committee points, but I suggest that we are discussing a vital principle; whether a person is free to produce what he wants to give to the public and what the public wants, or not. In Clause 10 a producer's licence can be refused on the ground that having regard to the existing and prospective consumption and the existing and prospective sources of supply of bacon, whether produced in Great Britain or elsewhere, it is, in the opinion of the Development Board, inexpedient that the premises should be used for the production of the bacon proposed to be produced thereon; The board is to be given power to say that there is enough bacon, that no more will be wanted, and that they are not going to grant licences to produce any more bacon. I want to ask, on what ground is this arbitrary figure to be fixed? There is no such thing as demand irrespective of price. It is nonsense to suggest that there is. If you make your prices low enough consumption increases. I have in my own constituency a lot of people who will show you how to eat bacon provided thèy can get it at a price which they can afford to pay. What nonsense it is to suggest that you can measure a constituency like mine with 58,000 people and say that 14,000 lbs. of bacon will be enough for them? That seems to be the way in which the calculation will be made. It is an arbitrary fixation. I have taken some figures from the Statistical Abstract and I find that in 1932 the average price of Danish green bacon was 64.5 shillings per cwt., and in 1936, the last year for which figures are available, it had risen to 101.80 shillings per cwt., a 50 per cent. increase. The consequence was that there was a tremendous decrease in consumption.

I can never understand why hon. Members opposite should insist on giving the foreigner millions of pounds for which he never asks. I know, from information I received when I was in Denmark, that they were quite prepared to go on selling bacon to this country at a much lower figure than what we are now paying. The people of this country, in order to increase home production of bacon by 500,000 cwts., have paid on these imports of almost 7,000,000 cwts. a tremendous increase in price, an absolute gift to the foreigner. There are other powers in the Bill. I want to deal with the power of these boards to inflict fines. In Clause 11, Sub-section (3), hon. Members will find these words: Where any of the conditions of a producer's licence have been contravened and the Development Board does not think fit to revoke the licence, it may … recover from the person who was the holder of the licence at the time of the contravention a monetary penalty, not exceeding five hundred pounds. I want to be quite fair, and it is true that they can go to arbitration, but I must protest against handing over to a non-judicial body a power which ought to belong to the courts of this country. What is the use of our protesting against dictators and their decrees when day by day and week by week we are handing over functions which ought rightly to belong to one of the three parts of our Constitution. What is the use of hon. Members opposite telling the people that they protest against the usurpation of the functions of Parliament and the courts when they go into the Division Lobby in support of a Measure of this kind? If hon. Members had the courage of their convictions we might alter this type of legislation. This country possesses the finest Constitution in the world, and the three parts which stand out are the King, the Parliament and the courts. It has worked wonderfully well, but each week we who represent the people are giving to Ministers or to some hoard or other powers which they never ought to possess.

Clause 11 creates a monopoly value. When a producer receives a licence, he gets with it a monopoly value, and if his licence is taken away, he is to be compensated. But the Clause goes further than that, for the licence may be transferred to somebody else. Are we to understand that the man to whom it is transferred is also to be entitled to compensation, and will that go on ad infinitum? If there were several transfers of a certain business, what amount of compensation would eventually be paid? It seems to me that it is wrong to create further monopoly values. With regard to Clause 14, my submission is that this Clause takes away the security of a business. I know that this is not a new thing, and I know that the House has done is before; as a matter of fact, since 1931 we have been progressively marching forward with this type of legislation. This Clause means that a licence can be taken away from a man although he has not contravened any regulation. It is true that he is to be compensated, but I would not like my business to be taken away even if I were compensated. It is astounding that a National Government, containing a great proportion of Conservative Members, should contribute, week by week, to this type of legislation.

There are certain provisions in the Bill concerning the small curer. He is safe as long as he remains small, but if he shows any initiative or enterprise, if a customer ventures to demand that curer's goods in greater quantity than is stated in the Bill, then, at that moment, the curer has to apply for a licence, and the whole of the business which he has worked up may be taken from him, because he may perhaps not be granted a licence. There are many hon. Members who are very proud to say that they are self-made men, that they have developed their own businesses; they ought to thank God that they live in this generation, because in the next there will be no self-made men, there will be no opportunities. A small man may build up a factory, it may be the most efficient and the most hygienic factory, it may give people what they want at a reasonable cost, but there is an eleventh commandant which has come into existence—"Thou shalt not give people what they want at a price which they can afford to pay." The National Government are continually taking away this kind of freedom, the freedom which to my mind has built up this country.

Clause 40 is the most remarkable Clause of all. It is the introduction of Socialism. [HON. MEMBERS: "No.''] I cannot understand why hon. Members above the Gangway protest against this type of legislation. This Clause relates to the Pigs Marketing Board, and it reads: The said board may also—

1. (a) buy and sell pigs;
2. (b) produce from pigs bacon or any other commodity normally produced from pigs by persons whose business it is to slaughter pigs or to produce bacon;
3. (c) sell, grade, pack, store, adapt for sale, insure, advertise and transport any pigs bought or commodities produced by it as aforesaid;
4. (d) for the purpose of producing from pigs any such commodities as aforesaid, establish slaughter-houses;
5. (e) buy and sell or let for hire to registered producers of pigs anything required for the production of pigs;
6. (f) co-operate with any other person in doing any of the things previously mentioned in this Subsection."

Under the Bill, the Board may do almost everything. Last week the House was discussing the Coal Bill, and the Government spokesmen refused an Amendment from this side which would have enabled the Coal Commission really to get coal. Where is the Government's consistency? I am against it in both cases. In this Clause, we have the introduction of Socialism, yet when an election comes, hon. Members opposite will go on to platforms and, with bated breath, tell the people that they are saving this country for private enterprise, that they want to assure that in this nation the individual shall be able to use his own initiative and retain this marvellous individuality, when all the world is marching under mob psychology—"Vote against the Socialists," they will say.

The Bill goes even further. The board have the power to become moneylenders. It will not be their own money that they will lend. It is astonishing to see the powers which have to be given in 62 pages of legislation in order that we may cat bacon a few mornings of the week. The board may do advertising and control the form of the transport which takes the little pigs to market. If I were to say all this on a public platform, people would think that I was John Tilley making a stump speech; but those are the powers in the Bill. The Bill is another step towards the Fascist State. [Interruption.] It is true. The distinction between Socialism and Fascism in this sort of thing is that under Socialism, at least, if there were any profit—I do not think there will be—it would be handed over to the public of the country, whereas this Bill simply gives out money in order that private people may profit. It gives the money of the public to private individuals, and that is a wrong thing to do.

I should be interested to know whose brain is behind all this. The same conception runs through the whole of these schemes. It applies, for instance, to potatoes. This afternoon at Question Time, in answer to a question about the Potato Marketing Board, we were told, in effect, "It is true that you are Members of the greatest deliberative Assembly in the world, but you have no right to be in possession of figures which will enable you to form a proper judgment. It is impertinent to ask questions of that kind of the Potato Marketing Board." I am wondering whether Sir Oswald Mosley has not some of his bright young things about in the Departments, for it seems to me that this sort of idea is rampant in all the Departments.

I have not time to deal with some of the things in the Bill which are not very bad and some of the things which are rather good. I think the proper grading of carcases is a good thing. My business is to analyse the Bill, upon which I am asked to vote, and to see whether or not I am prepared to accept it. I am not called upon to come to the House and say that such a thing is right, but that another thing is wrong. I am called upon to give my reasons for accepting or not accepting the Bill, and I will give them briefly. The first price of these schemes is that the nation's money is to be given for private profit. The Minister of Agriculture said this afternoon that the agricultural industry is inherently economic. When it is a question of £1,000,000 for three years, I remember our experience with the meat business; when three years are ended people will come forward, and say, "You have not given the industry a chance; let us have the money for another three years. "The second price we have to pay for these schemes is the sacrifice of individual liberty, something for which no economic reward can make up. The third price is the transfer of judicial functions to a non-judicial body. The fourth price is an increased cost to the community. The fifth price is the planned scarcity of supplies.

The sixth price is the creation of a huge bureaucracy, with all its attendant dangers. I remember that at the beginning of the 1931 Parliament, Conservative Members made against Labour Members the charge that when the Labour party were in office they were always setting up committees rather than tackling matters. I would like to see the returns of the bureaucracy which has been set up, since the National Government came into office, in schemes of this sort. In looking at the unemployment figures, I am always interested to see that the list of non-producers taken from unemployables to employables is increasing. There are fewer people in production proportionate to the number of non-producers. We talk about economy in the House, but every year we create thousands of State officials, who go about, as I said in the Debate on the Coal Bill, like commissars in the Russian State, dictating everywhere. The seventh and final price which the country will pay if this type of legislation continues will be the substitution of private enterprise by Socialism. We have taken this legislation off the main line into a certain junction, but when hon. and right hon. Gentlemen above the Gangway come into office—for I do not think this Government can go on for ever—they will simply go to the junction and put it on the main line again.

I conclude by saying that I am not prepared to pay those seven items of price for this type of legislation. I beg the House not to think of this Bill merely as a bacon-producing Bill but as an absolute challenge to individual liberty. It is the creation of a huge bureaucracy, mulcting the people in prices which they ought never to be called upon to pay and handing over to another body functions which ought to belong to the courts. I beg hon. Members before they vote for the Second Reading of the Bill to give serious thought to whether we, as a House of Commons, are prepared to pay the price which this Bill, in its 62 pages, calls upon us to pay for an enlarged bureaucracy.

6.31 p.m.

Mr. Liddall

; I think the House will agree that we have had the pleasure this afternoon of hearing the hon. Member for South Bradford (Mr. Holdsworth) at his very best. But when he twits hon. Members on this side with not, at times, taking a strong line by voting against certain Measures, I would remind him that Members on this side are sent here by their constituents to support the National Government and not to follow the hon. Member, first into one Division Lobby and then into another. But I will give the hon. Member one message of cheer to take back to his constituency. He deplored the high cost of bacon and said the reason why there was a demand for Danish bacon was that it was always of standard quality and was sold at a reasonable price. I want the hon. Member to be able to go back to his constituents and tell them that there is to-day a standard quality of English bacon which costs less than the Danish bacon. I want him to be able to take back with him at least one cheery message after the display he has given us this afternoon.

This Bill, as the Minister explained, is for the reorganisation and assistance of the bacon and bacon pig industries in Great Britain. It was prophesied in several newspapers that during to-day's Debate we should be told how to produce the perfect pig. I have reared pigs, fed them, killed them, scraped them, salted them and eaten everything about them except the squeal, and I want to tell the House that we in Lincolnshire can produce the perfect pig to-day, as long as we can be assured of a reasonable price as a reward for our enterprise.

I wish to ask what is to happen to the small curer under the new rationalisation scheme in regard to his existing quota. Will it continue as at present, or will it be increased according to the capacity of his plant? The Minister says that if the small curer goes above his limit of 60 cwts. he may get his licence to be a curer in a higher category, but the Minister did not say he "shall "get his licence. I do not want hon. Members to think that I intend to oppose the Second Reading of this Bill. I do not intend that for one moment. If there are to be any new bacon factories built in this country in the near future, I hope we shall have one built at Lincoln. But I fear that unless drastic Amendments are accepted or carried in the Committee stage of the Bill, the inevitable result will be the closing down of a considerable number of these small factories. There cannot be any other result if the small bacon curer's quota is to be taken as including offals and all by-products because it is the income from the pickling of pork products which, in the majority of cases, makes all the difference between profit and loss at the end of the week.

I cannot for the life of me understand why so much importance is attached to pickled pork. It is almost entirely a side line of the small man. How much pickling do the large curers do? Surely the big men on the Bacon Marketing Board are not pressing for the inclusion of this pickled pork in order to "do" the small man out of his already small quota of bona-fide bacon. I most earnestly beg the Minister to consider the implications of the Bill in this respect before he comes to any hard and fast decision. Many a small curer has sunk a large amount of capital in machinery and plant. For example, a refrigerating plant may represent £2,000. What is to become of this plant, if you take away the business which he has spent a lifetime in acquiring? You are not dealing with a type of man who wants something for nothing, or whose one ambition in life is relief and maintenance. Retail meat dealers are loyal, honest, industrious, and respected citizens who, quite properly, look for that consideration which it is their right to expect from the Government of the day. I suggest to the Minister that the definition of bacon should be altered and that the exemption of general butchers who pickle pork, at present granted under the bacon marketing scheme, should be continued, and that the position of such persons should not depend upon the decisions of the proposed new boards.

6.39 p.m.

Mr. Barnes

I wish to associate myself with at least one point made by the hon. Member for South Bradford (Mr. Holdsworth). That is in reference to the danger contained in this marketing board legislation, that these boards are being enabled to build up their own penal code within this type of administration. We ought to bear in mind that in a commercial organisation you have not the legal judgment possessed by the ordinary courts of this country but you have the very strong motive of commercial and economic and competitive interests. It is extremely dangerous that, in the new commercial system which we are trying to create by these boards, we should permit to grow up this method of determining whether a person should or should not participate in the production of a certain commodity and whether a particular business should or should not be permitted to expand within a certain industry while people whose economic interests are involved are to be part of the administration and are to be capable of imposing penalties. That appears to be thoroughly bad.

The second point which I should like to make in a general way with reference to the type of organisation which is being evolved in the post-war period, is that we are here conferring upon bodies of trader's powers hitherto reserved for State and public bodies. Not only are we creating public powers in an area of private interests but we are enabling these bodies to enclose commodity production. I am rather inclined to think that we are to-day beginning to pass a series of com- modity enclosure Acts which may have just as grave consequences to the future of this country as the land enclosure Acts of a century ago. I think it was the recognition of that fact which caused my hon. Friend the Member for Don Valley (Mr. T. Williams) to impress upon the House that when we commence on legislation of this kind, the public interest should be supreme and a public body should eventuate to conduct these undertakings. Speaking as a representative—with my right hon. Friend the Member for Hillsborough (Mr. Alexander)—of the Co-operative movement in this country, I do not consider that there is anything fundamentally inconsistent between the view expressed by my hon. Friend the Member for Don Valley and those which we hold regarding this type of organisation. I also assume that in conceiving the type of organisation which would serve the public purpose, the Co-operative organisation has been in mind—Denmark has been stressed very definitely here today—as an example we might copy in this country.

I do not think the hon. Member for South Bradford has discovered what is happening under this type of legislation. He seemed to hesitate as to whether it represents a Socialist experiment or a Fascist experiment. I think the explanation, at this stage at any rate, is simpler than he suggested. What we are witnessing now is the big capitalist swallowing the small capitalist. What is to follow on that process we may leave for the moment. This Bill undoubtedly endeavours to give effect to the statement made by the Minister to the House on 10th March. Before we approve of it we ought to examine the experience which we have had so far of this type of legislation in the pig and bacon industry. The experience so far has not been a happy one, and it has not justified the time and effort, or the powers which the House of Commons has granted to big pig producers and bacon curers. I think we ought to have much more definite evidence from the Minister of Pensions before this Bill is passed than we have had from the Minister of Agriculture. I do not feel that we should delude ourselves or the country by making encouraging speeches about our hopes in regard to legislation of this kind if we cannot deliver the goods by a much more practical and effective method than has so far prevailed.

How can hon. Members expect to create, in the long run, a healthy structure in any type of industrial organisation if they commence on a policy of purely artificial stimulation? There has been no evidence so far that the industry of its own accord, with its powers from within, can create a healthy type of organisation. Parliament gave power to the Bacon Marketing Board to enable it to create that structure, but it has hopelessly failed in 1936 and 1937, and the only real difference in this Bill is that the State now proposes to pump into the industry a certain amount of public money. Does that not bring us to this position? Here you have the conflict between the interests of the taxpayer, for which the Exchequer is responsible, and the interests of the community as a whole. The interest of the Exchequer in the payment of this sum, limited though it may be in reference to the total revenue of the whole community, has the effect on the Treasury mind that it is anxious to keep down any contributions for a purpose of this character, and so you are likely to get the Treasury influence, which is so powerful within the administration of a Government conspiring with forces outside of Parliament to keep up prices in order to save the Exchequer contribution, irrespective of the cost to the community as a whole in the matter of prices.

It is of no use dismissing that view as representing merely a critical opinion of the Bill, because that view is backed so far by actual experience of the operations of these boards. The figures have already been quoted, and I do not propose to weary the House by mere repetition, but it is a fact that we had to pay in 1937—and the prices of bacon are still higher to-day on an average—practically the same price for 38 per cent. less in supplies than in 1932. I fail to see that it is good public policy for this country to pay to overseas producers unnecessarily a large sum which has no result on the industry at home. I can quite understand the building-up of an efficient pig and bacon-curing industry in this country, but I submit that that policy should not permit the consumers in this country to pay excessive sums to overseas producers when the payment of that money is not essential for the accomplishment of the home objective. This very Bill itself demonstrates that we have not accomplished our purpose. We have been paying excessive sums to Denmark for decreased supplies, and the community as a whole, and particularly the working-class community, have had to reduce their consumption of bacon or of the better cuts and grades of bacon.

The fact of this Bill being produced to-day indicates clearly that we have not accomplished the purpose for which that quota was imposed, namely, the building up of a successful pig and bacon industry. Not only are we paying more, but with this scarcity problem, the Danes and other exporters have been able to put on our market a poorer quality than they would have had to put on if they had not had an automatic sale here for their goods. No one can say that part of the increase in price has been due to an increase in the margins which the retailers or the distributors have charged. I think it is a generally accepted fact in the distributive trade that retail margins have been less in the bacon trade since the quotas were imposed. Then again where you create an artificial shortage of supplies on your market, you disturb the legitimate trade. Persons come into the industry to try and get hold of short supplies, and all kinds of difficulties arise.

With this experience behind us, the Minister comes forward to-day and proposes that the State should stand behind, in the form of public subsidies, a scheme which will compensate the curers if bacon prices fall below 94s. 9d. per cwt. and which will compensate pig producers if foodstuffs rise above 8s. 6d. per cwt., and the subsidy is to be payable for three years. I feel certain that with the experience which we have had with other subsidy and dole payments in the postwar period—sugar beet is a very notable instance—if we get large-scale industry built up on this principle of subsidy, we shall have great difficulty in removing this artificial prop at the end of the three years. Again, cannot we recognise, as Members of this House, that if a part of our policy is to create a larger type of factory organisation—with the intrinsic purpose of which everyone will agree as a method of organisation—and if that factory type of organisation rests on this pig production, we are likely to get these factory organisations themselves entering into the production of pigs with a large-scale type of organisation and then representing in- creased demands for the continuation of the subsidy? That is more or less what happened with regard to the sugar beet industry in this country.

I pass over the prices and the contract quantities of pigs, because again they have been mentioned this afternoon, but I would like to support the general criticism of my hon. Friend the Member for Don Valley on the ambiguity and the vagueness, and in some instances the duality, of the powers that are conferred on the Development Board and the Bacon Board. May I say, in passing, that the principle which the Minister is introducing here, that a majority of the Development Board should be public or Government appointments, meets with my own personal approval; but although I take it that in many respects the powers which this board will exercise correspond in some degree to the powers of the Commissioners under the Livestock Marketing Act or the Sugar Commission Act, I notice there is a complete absence of definition of their powers and conditions, as compared with the previous legislation when we were appointing the Livestock Commissioners and the Sugar Commissioners. I should like to press the Minister to state clearly to the House why there is a kind of enabling Clause and powers are given to the Development Board, and he cannot determine more specifically what they are to do. There is no qualification stated, and we get no indication of the type of persons that he will appoint, or whether they are to be individuals with no actual trade interests in either pig production on the one hand or bacon curing on the other.

When we come to the powers of the Bacon Board and the Development Board and the priority right to produce a scheme of rationalisation—and it is the bacon curers that have to be rationalised —it seems peculiar that the Minister should first create a Development Board, which represents, one would assume, the larger public interests in this problem, and could survey any scheme of rationalisation, from the point of view not only of the degree of efficiency in the industry, but of matters of equity between the various grades and classes of curers and of the matter of supply to the community as a whole. Therefore, one is puzzled and finds it, from a practical angle, almost impossible to understand what purpose the Minister has in view in giving the Bacon Board power over the Development Board. I think he ought to make that point clearer before we pass the Second Reading of the Bill, which I assume we shall do, because, one learns from experience that no arguments can deflect the votes of hon. Members opposite. The Bacon Board—again I deal with this point to protest against these cumbersome uneconomic interferences with what should be simple trade practices—submits the draft to the Development Board. The Development Board submits it to the Minister. The Minister submits it back again to the Bacon Board. If there are any protests, they go to an investigation committee. And so it goes on. I feel that we must ultimately find a much more simple method of conducting and organising post-war industry than we have hitherto.

In connection with these matters I noticed with some interest the report of the Food Council dated 3rd December, 1936. Both the hon. Member for the Don Valley and the hon. Member for South Bradford emphasised the advantage of learning from Denmark. The Food Council, in paragraph 28 of its report, makes these observations on the breakdown of the scheme then existing: We trust that after 1937 the Bacon Development Board will exercise their powers of rationalisation and will do so with the object of allowing the best placed and most efficient and economic factories freedom to develop. Then they go on: In this connection we hope that the desirability of encouraging farmers' or consumers' co-operative factories will be investigated. I should like to ask the Minister whether he has paid any attention to that recommendation, and whether he proposes to encourage the creation of farmer co-operative organisations. He recognises the importance of the consumers' co-operative organisation, which already represents such a large market for the home-produced commodity. Why should not we recognise that the consumers as far as concerns the sources from which they get their supplies, are to-day very definitely divided in their point of view? Why should not Government Departments recognise that fact in the distributive world? The co-operative movement, which represents 8,000,000 consumers, cannot have its business rationalised and interfered with by private trading com- petitive interests in Acts of Parliament such as this. Would it not be fairer for the Minister to recognise that, as far as this section of the trade is concerned, co-operative experiment and co-operative development should proceed side by side with this other type of organisation, so that we could see over a fairly reasonable period what type of organisation is most suited for the trade of this country? I mention that because Clause 10, paragraph (a) lays down that a producer's licence shall not be refused if immediately before the passing of this Act, no licence was in force in respect of the premises under Part III of the Bacon Development Scheme, 1935. That means, I take it, that any business that was not in possession of a licence under Part III of the Bacon Development Scheme, 1935, becomes then subject to these conditions: and that, having regard to the existing and prospective consumption and the existing and prospective sources of supply of bacon, … I take it that questions of where the bacon is produced, matters of transport, matters of handling and things of that kind will come under that. These are, on the face of it, practical points of organisation, but they raise a larger difficulty to my mind The paragraph concludes: it is, in the opinion of the Development Board, inexpedient that the premises should be used for the production of the bacon proposed to be produced thereon; I submit that it would be very difficult indeed for any new developing organisation to get in under that provision. In the case of a business organisation that is built up to meet any body of organised consumers it is often found, for constitutional reasons and for commercial administrative reasons as well as for the, general convenience of their members, desirable to have their factory organisation nearer to the point of distribution rather than the point of production. I really do ask the Minister to reconsider this paragraph, which seems to have been framed without any relation to the practical needs and experience of industry. I consider this Clause particularly dangerous to a consumers' organisation like the co-operative movement, and I hope that between now and the Report stage the Minister will give serious consideration to the modification of that paragraph. I should like to end up on the note on which I began. If Parliament is going to give to any body of private business people powers of this kind, it is a recognition that private business can no longer serve the needs of our modern community, and these powers should be vested in public bodies who would be responsive to no other interests than the public benefit and the public profit.

7.9 p.m.

Lord Willoughby de Eresby

I rise to support this Bill, and it certainly must be a matter of pleasure to anybody who, like myself, represents an agricultural constituency that we are once again considering an agricultural Bill. It seems to be a matter of pleasure also to other Members who do not represent agricultural constituencies. The hon. Member for South Bradford (Mr. Holdsworth) obviously enjoyed extremely the half-hour in which he addressed us on the merits of agriculture in a Free Trade world. I think that the whole House will feel relief that we are able to-day to turn from the somewhat heated Debates on foreign affairs which have occupied so much of our time in recent weeks, and once again to consider so essentially, homely and unemotional a subject as pigs. Whatever our views are on the relative merits of this Bill, I think we must all be glad that the Government are turning to that branch of agriculture which has been in the doldrums for some months now, and is giving it the lead for which it has looked for so long. I must admit that I am rather surprised at the reception which the Bill has had from hon. Gentlemen opposite and the rather lukewarm support which they have given it. I often hear the opinion expressed in the country that this Bill is pure Socialism, and I cannot help feeling that those who express that view must regard Socialism from a less extreme standpoint than hon. Gentlemen opposite.

I am also struck with the contrast in the Opposition attitude towards this Bill and towards the Coal Bill which recently passed this House. Their main criticism of this Bill is that the regulation of supply from both home and foreign sources which the Bill envisages will tend to raise the price of bacon to the consumer. That argument, I admit, I can follow when put forward by hon. Gentlemen below the Gangway. The hon. Member for South Bradford and his friends, with a certain measure of consistency, oppose all pro- posals for selling schemes for the regulation of the home market. Where in my humble opinion their policy of laissez faire breaks down is when they have not the courage—or possibly the desire—to vote against such things as wage boards and minimum wage rates. Surely it is essential, if agriculture is to be carried on on the laissez faire principle, that it should have a free labour market. Hon. Gentlemen opposite strike me as being even less consistent in their opposition to the Bill. Any selling scheme or scheme for the regulation of home supplies, if it affects coal and miners' wages, is from their point of view on the whole a good but when it affects the agricultural industry it is on the whole a bad thing. Even if you admit—which I do not myself—that the rise in the price of bacon in recent months may be attributed to the policy of the Government, I think hon. Gentlemen opposite would do well to realise that the rise in the price of bacon is nothing compared to the rise which has taken place in the price of coal M the past year or two. A cheap supply of coal is equally essential to the prosperity of this country as a cheap supply of food.

I do not want hon. Gentlemen opposite to think that I am complaining. I dutifully supported all those Measures which have recently gone through this House with the object, as I thought, of benefiting the miner in his exacting and dangerous pursuit, but I do think it ungenerous of them not to support Measures such as this, which are designed to enable the producers of food to produce at a profit, and have a surplus which they can pass on to those who help them in their labours. In my opinion the Government's proposals should, in the main, receive the unanimous approval not only of this House but of the agricultural community. Any criticism which I may offer is made with the desire to see them achieve a maximum amount of success in the object at which they aim, which is the better and greater production of pigs. I think the principle that the producer should be encouraged to produce more by being assured of a reasonable remuneration for his labour is one which has been accepted for some time past in other industries, and is very welcome even at this late hour to the pig production industry. As I understand it, the price the producer will now receive will be based solely on the cost of feeding stuffs, independent of the selling price of bacon and of imports from abroad or home production.

I consider this a considerable advance upon the old scheme and the only sensible principle on which to base the price. I congratulate my right hon. Friend on conceding this principle and for introducing this basis for deciding the price. I hope that I shall not disappoint the hon. Member for Don Valley (Mr. T. Williams) or the hon. Member for South Bradford if I say that, in my opinion, the price is fair and that I do not, like Oliver Twist, ask for more. I must be allowed to put in the qualification, however, that I do not consider it an overgenerous price. It should offer a real incentive to the efficient producer to go ahead without unduly encouraging the inefficient producer. The proposals are not likely to bring about any appreciable turnover in pigs during the first 12 months of the scheme coming into operation, but we can look forward to a substantial increase in production throughout the industry when the stability which the proposals offer is generally realised.

There are two criticisms which I should like to offer. I wish that my right hon. Friend had seen fit to introduce a six months' period contract rather than a 12 months' period contract. Under the longer period we shall find farmers having to contract for pigs which are as yet unborn. We all learned at an early age that it is inadvisable to count our chickens before they are hatched. This method is both hazardous and speculative, except for the man who specialises in pig production and has a large number of sows over which he can spread his risks. I have understood that it is the Government's policy on the whole to encourage the well-established practice of mixed farming. It is the farmer who keeps a few pigs who may suffer under the 12 months contract. My second criticism is that, like the hon. and gallant Baronet the Member for Maldon (Sir E. RugglesBrise) I doubt whether the term of three years under which the guaranteed price will last is long enough to encourage producers to lay down capital of a more permanent nature in the form of piggeries. If the Government extended it for five years we are more likely to see not only an increase in the pig population, but greater efficiency in production. I do not want to labour a point which I raised the other day, but I would like to protest again against the powers which are given in Clause II to a non-judicial body to impose fines.

Some time ago, in conjunction with other Members from Lincolnshire, I put forward a plea for a farmers' co-operative bacon factory to be established in that county, which has the second largest pig population in the country, on similar lines to those which have been erected in Yorkshire. The recent collapse of the pig scheme was an unpropitious moment for us to go forward with this cause. Part I of this Bill provides for the establishment of a new and stronger Development Board, and Part IT envisages some measure of rationalisation throughout the country. I trust that the question of the economic location of factories will be one of the matters to be considered at an early date. A local factory in Lincolnshire would considerably reduce the wastage which at present goes on through pigs having to be sent long railway journeys to the Midlands, and it would tend to gain the confidence of the producers in the area. It would help also to gain their co-operation if they had a factory where they could see the pigs graded and could come into personal contact with the men who were taking their produce. I would like to assure my right hon. Friend that he has not only my support for this Measure but the support, as far as I know, of all those in the agricultural community whom I have the honour to represent. I trust that in return for our support he will consider the one or two points which I have raised.

7.21 p.m.

Mr. Price

This Bill attempts to bring some kind of order into the marketing of pigs and the marketing and handling of pig products. It is high time that some Measure of this sort was introduced, and the only serious fear I have, apart from my main objection, which concern the part dealing with imports, is that there will be too many loopholes in its provisions which will make it ineffective. The loopholes in the last bacon scheme caused it to break down. There were those who were disloyal to the old scheme, and people who did not contract made better prices on the provincial markets than those who stuck by the scheme because there was not a watertight method of contracting. That was one of the reasons why the scheme broke down. The conditions in the present scheme are certainly tighter, but there are still many dangers which I hope will be removed in the Committee stage. The pig industry is very difficult to organise, from the producers' angle at any rate, because there are so many small producers. It is difficult to cover them with a contract or to get them to come in. Yet I feel strongly that it is a good thing that pig production should be to a considerable extent in the hands of small producers.

There is a great deal to be said for small units of production and for the larger farmer who engages in pig production as part of a mixed farming process—in other words, makes it only one section of his operations. A kind of pig farming which is showing a tendency to increase is the big factory method. The advantage of the small method and the mixed method is that it tends on the whole to control disease. It is generally more healthy that pigs should be left to run in natural conditions. As I see the Minister of Pensions here, I cannot refrain from making a quotation once more from the Georgics. Last Session he prompted me to do so, and I have now found in Virgil's Georgics a reference to the feeding of pigs and their method of treatment, where he says: 'Venit hiems—glande sues laeti redeunt, which, I think, means, "Winter comes—and the swine come home gladdened with the fruits of the earth. "It evidently means that Virgil in those days believed in a free range for pigs. He did not believe in keeping them shut up in pens and feeding them on mass production methods. There is a great deal to be said for this method of producing pigs on the small scale. In my constituency there are many working men and miners who engage in small agricultural operations in their spare time. Not least of them is the running of pigs on the common land in Dean Forest. Many a healthy stock is raised in that way. There is far less danger of disease breaking out than where production is on the factory method.

I want to see some method whereby these small producers can be brought into the contracts under the new scheme. It seems to me that there are prospects of this taking place under the Bill. Under the last pig scheme it was possible for group contracts to be made, but they did not mature very well. Where they were attempted undesirable people often got control of the group contracts. Indeed, the National Farmers' Union, in a statement they made to the Minister last year, said that the revival of the group contract on a satisfactory basis should be an important element in the re-introduction of the pig scheme. Mr. David Black, who is a big pig producer, made a statement to the effect that in many cases group contracts under the last scheme actually got into the hands of certain members of the Livestock Traders' Association. In other words, dealers rather than producers got control of these contracts. Something should be done to see that group contracts are properly organised so that those who organise them or who sign on behalf of the producers are people in whom the producers have proper confidence. The principle should be that contracts should only be made between the board and groups of producers who appoint agents to act for them.

It has been suggested to me, and I think it probable, that if conditions work out as it is thought they will, there will he a large number of people not directly concerned in agriculture at all who will take to pig production on a big scale. I refer to financial interests who would rent land, construct houses, and begin fattening pigs and producing bacon on the concentrated methods adopted in Denmark. There is one danger which I can see. Some means ought to be introduced whereby those who loyally stood by the old pig scheme are not ousted by newcomers of the type I have mentioned. Some form of preference should be adopted for filling up the contracts for those who contracted under the former scheme. Otherwise we may get the scheme pushed by those who are not directly concerned in agriculture as a whole, though, as I said just now, the mixed farmer and the small producer of pigs are producing them in a much more healthy way, with less likelihood of serious epidemics of disease than with pig-factory methods of production.

The provisions of the Bill dealing with the rationalisation of factories are, of course, a step in the right direction, but I repeat the fears and warnings of hon. Members on this side of the House, and of some Members sitting below the Gangway who have doubts whether the process will not be too slow. The hon. and gallant Baronet the Member for Maldon (Sir E. Ruggles-Brise) expressed that view, and I think there is much to be said for it. It seems that a kind of Gresham's Law is at work in bacon production, that is to say that the least efficient factory sets the tone for the rest. That has been the trouble all along. The less efficient factories have increased the cost of producing bacon; they have depressed the price to the producer on the one hand and kept up the retail price to the consumer on the other, and hindered I he proper factory method of those who were able to adopt them. Very much depends upon whether there is sufficient drive behind this Bill when it becomes law to see that it is enforced properly and quickly. One serious flaw is the open market for pork, although I am rather impressed by the argument that for the moment it may be difficult to tackle that point, because the pork market, as the hon. Baronet representing Maldon said, bristles with difficulties. At the same time I think the Government will have to keep their minds open on this point and reserve the right to act if it is found that a free pork market is undermining the stability of the bacon scheme. We all remember, during the operation of the last scheme, that when pork prices were good producers deserted the scheme; they either were not contracting, or if they were contracting they were sending in their own pigs as pork and were buying elsewhere to fill up their bacon quotas. That kind of thing left the way open to bribery, commissions, and troubles of every kind. Therefore, I hope the Government will keep an eye upon things and see that the pork market does not wreck the scheme in future.

The prices which the Minister has fixed under Clause 24 are, I think, on the whole reasonable. I am glad that he has not fixed a high price, because I am certain that we do not yet know enough about the cost of producing bacon in this country. I was talking on Saturday to one who is on the agricultural research staff of a South of England University and asked him what figures and facts he had about pig and bacon production. He said: "As yet we do not know enough about it, but we do know that costs vary very much from farm to farm and producer to producer." It would be unwise for the Minister to fix a price which would satisfy the less efficient producer. On the contrary, the aim should be to stimulate low-production costs among pig producers. Therefore, although I do not think these prices are either too high or too low, we shall in time know what the proper figures are, and will be able to adjust them in future.

My main criticism of the Bill falls upon Clause 27, dealing with quotas and restrictions, which carries on the old methods of the Act of 1935. Many hon. Members on this side have referred to the stupidity of paying the Danes and other foreigners more money for less bacon. I am not one of those who want to see a return of the conditions in 1932, when bacon was down to slump prices, and pigs were too. That condition of affairs was entirely uneconomic, and while I admit that the retail prices of bacon are not yet where they were before the slump I do feel very strongly that the whole method of regulation—or lack of regulation—of imports is a serious flaw in this scheme. Moreover, it ought to be borne in mind that the wholesale price of Danish bacon in this country has risen in recent years far more than the price of home-produced bacon, indicating again that the Danes have got the best of it, and indicating, also, that among a section of the public there is a taste for Danish bacon connected, possibly, with its quality. Probably the research which is to be carried on under this new scheme will be able to assist us in satisfying that taste with home-produced bacon.

Clearly there will be no settlement of this matter until we face the whole question of the regulation of imports on proper, scientific lines. The hon. Baronet the Member for Maldon advocated a levy-subsidy. To my mind that is unsatisfactory, because we can never tell what will be the effect of a levy-subsidy upon price or quality. In my opinion the only way to deal with the problem properly would be to set up some kind of public utility importing corporation, an import board with monopoly rights, to determine the quantities to be imported for a year, or even for a term of years, and to make long term contracts under which it would be possible to buy in bulk and take ad- vantage of the low prices abroad to subsidise home production. In other words, let us take in everything that the foreigner will send, even though it is at a low price, and then unload it on the market here not at that low price but at some price which is lower than the home producer can get for his bacon. In short, we should find a medium price between that of the foreign imports of bacon and home-produced bacon. That is the method which the Government of New Zealand have adopted for exports when dealing with butter and other kinds of dairy produce. We, being mainly an importing country as regards agricultural produce, should try the same kind of thing for imports. That would be preferable to carrying on under Clause 27 the old and discredited method of organising restriction, because the consumer is liable to go on strike and to knock the bottom out of the whole scheme. But in spite of all its weaknesses I am of opinion that this Bill is a useful and much needed contribution towards the organisation of the industry, but I hope that the Government will listen to reasonable Amendments in Committee, and that when it is on the Statute Book it will be worked with that energy which alone will make a proper pig and bacon producing scheme possible in the future.

7.42 p.m.

Sir Ernest Shepperson

I should like to congratulate the hon. Member for the Forest of Dean (Mr. Price) upon holding views very similar to those which I hold myself regarding the quantitative regulation of imports, and I should also like to add to the appeal which he made to the Minister to see to it, since there is to be a limitation upon the number of pigs which come under this scheme, that the number is not absorbed by the factory interests but is distributed among real farmers, because the Bill has been brought in in the interests of British agriculture and is one for which I desire to give my thanks to the Government and the Minister. Hon. Members opposite often think of us on this side of the House who represent agricultural constituencies as, in a way, beggars who are always asking something of the State. Let that be so. I am definitely not ashamed of begging for assistance to maintain the oldest British industry, and still the most important. For some considerable time we have begged help from the Government, and as an agriculturist and as representing agriculturists I say that our pleas have not been in vain. During the past six years we have been helped in one direction and another, and agriculture to-day is in a far better position than it was five or six years ago. The beggar has come to the House hungry, and his hunger has been to a certain extent appeased, but he is not yet fully satisfied. He begs again for a loaf of bread. This Bill does not quite give him the whole loaf, but more than half, let us say three-quarters of it, but for that he says, "Thank you."

I was always led to understand that in this world what you got for nothing was not worth having, Believing that, I am assured that what we get under the Bill must be of great value, because we are not getting it for nothing. We are paying for it, and the price of it is the loss of a great deal of our liberty and of our individualism. I listened to the hon. Member for South Bradford (Mr. Holds-worth). Under the Bill we are subjecting our industry to control. I would support him, and do support him, in a desire for individualism, but I know that the continuance of individualism in this country is an impossibility. The trend of industrial evolution is towards collectivism. It does not matter how much we desire to retain individualism, we cannot stop the process of collective industrialism; but we can guide collectivism, and I trust that the Bill will guide collectivism in the right direction as applied to agriculture.

We pick up this Bill, containing 51 Clauses. We read it, some of it, but by no means all, and we at once seek, as agriculturists, Clauses 22 and 23. They are the Clauses that interest us. Why? Because they are the Clauses to give us something under the Bill. What do these Clauses give us? We are to receive 12s. 6d. per score lbs. of dead-weight pork, when foodstuffs remain at a figure of 8s. 6d. I have analysed that figure and what it will do. Seven scores of dead-weight pork, that is 140 lbs., at the price of 12s. 6d., will yield the producer £4 7s. 6d., and that is what he will receive. What will he pay? Let us estimate a weaner, which is a three-month-sold pig off a sow, to weigh 30 lbs. and its price at 30s. It takes 187 lbs. of live weight of pork to produce the seven score, or 140 lbs., of dead weight with which we are dealing. Therefore, in order to produce 187 lbs. of live weight, less the 30 lbs. weight of the weaner, that is, 157 lbs. live weight, we should require a consumption of 6½ cwts. of meal. That would be allowing 4.6 lbs. of meal to produce 1 lb. of live-weight gain. Therefore, we have to reckon as follows: The weaner at £1 10s., cwts. of meal at £2 15s. 3d., a total cost of £4 5s. 3d, for a pig which we shall sell at £4 7s. 6d. That leaves a profit, but one that cannot be considered excessive when you take into account the risks associated with production.

As to the regulation of imports, Clause 27 of the Bill continues for another period the protection of the British market by quantitative regulation of bacon coming into this country. I definitely say that I regret that method of regulating imports. I agree to the full with the hon. Baronet who spoke in supporting, in preference to quantitative restriction of imports, the levy-subsidy principle. It always appears to me that if you restrict the import of an article you raise the price in this country of that article to the foreign exporter. I cannot understand why there is any school of thought at the present time in favour of giving to the foreign exporter to this country an increased price for the article which he sends here. It seems to me that a better way is to place a levy or a duty upon that imported article and, instead of raising the price to the foreigner, to cause the foreigner to pay a small levy for the privilege of entering our market.

We shall shortly be faced with a Budget which we know will cause us as a nation to make many sacrifices, due to the rearmament programme. In this Bill, we are paying £1,000,000 from the Exchequer towards the industry. Under the levy-subsidy principle we should cause that money to be paid, not by the British Exchequer, but by the foreign importer of bacon into this country. I should prefer to see £1,000,000 paid by the foreign importer. Let us bear in mind that the activities of the foreigner abroad are causing our rearmament programme. Such help would further assist our rearmament programme. I believe in relieving as much as we can the payment from the Britisher, and I have no reason for letting the foreigner off from paying his just due for entering our market.

Those are my criticisms of the Bill. What am I to do about it? I would like the whole loaf, but if you give me three-quarters or seven-eighths what am I going to do about it? Am I going to turn it down? No, I am going to say, "Thank you" for it. The Bill gives assistance to British agriculture in a manner with which I do not to the full agree, by the quantitative method. I should prefer the levy-subsidy, but am I to turn it down because of a method with which I do not agree? I am an agriculturist. This Bill is essential to the pig industry and, as an agriculturist, because the Bill will help pig producers in this country, I propose to give it my hearty support.

7.56 p.m.

Mr. Dunn

I do not enter into this Debate with any qualifications as an agriculturist, indeed, my qualifications as an agriculturist are very much unlike those of the hon. Gentleman who has just spoken. He comes to this Debate with a very wide knowledge of agriculture and speaks as a typical agriculturist would be expected to speak. As I understood his speech, he takes the line that however much agriculture may be able to get out of the Government, it badly needs it in order to put itself on its feet again in this country. His reference to the pig industry contained a little sum in arithmetic showing, right from the weaner pig to the full grown animal, and measuring it out according to the price set out in the Bill, how much profit the agriculturist would get. I speak as a layman and a back-bencher. One of my troubles is that we are reputed to have in this country the best land for bacon and the best climate in the world. If those statements are facts—and many agriculturists tell me that they are—how is it, having the best land and the best climate, together with the biggest market in the world within our own country, that this important industry is not the most flourishing industry in the country?

As we go through the country we ask ourselves why it is that agriculture is in such a parlous state as at present, but I do not think that the hon. Member for Leominster (Sir E. Shepperson) can really complain about what the Government have done. The Government have been prodigal in the way in which subsidies have been offered and been accepted by the agriculturists of this country.

Sir E. Shepperson

I quite agree, and I certainly make no complaint.

Mr. Dunn

I am glad to know that the hon. Gentleman agrees with me. I understood that in regard to the Bill he was rather in the position of Oliver Twist asking for more. The amazing thing is that subsidies of one kind or another have been given to agriculture. I heard one Member say that the amount of subsidy given to agriculture by this Government and previous Governments was in the region of £30,000,000 a year, and I have heard the estimate that it is £50,000,000 a year. Now additional money is to be given for the purpose of producing pigs. I am not grumbling about that at the moment, but, if the figures which have been quoted in this House represent the amount granted in subsidies to agriculture in this country, the fact we have to face is that the total wages bill for all the agricultural labourers in the country is given back to agriculture in the form of subsidies at the present time. Then the hon. Member asks for more. The Mover of the Amendment quoted certain interesting figures. I understood him to state, and it has been repeated by the hon. Member for South Bradford (Mr. Holdsworth), that the importation of bacon into this country in 1932 was 11,395,000 cwts., representing a money value of £30,000,0430, and that in 1937 the quantity imported had fallen to 6,935,000 cwts., but the money realised upon that quantity of imported bacon only fell from £30,000,000 to £29,000,000. I have taken the trouble to work out the figures, and, speaking of imported bacon alone, I find that every family in this country that uses imported bacon at its breakfast table has been called upon to pay from 4d. to 5d. per lb. more for it since this Government came into office in 1931.

Sir E. Shepperson

If a levy of rd. per lb. were put on foreign bacon, it would more than cover all the money that is necessary to bring up the price to what is required by the producers in this country, and, therefore, there is no reason whatever for the figure which the hon. Member mentions.

Mr. Dunn

And therefore, if the hon. Member's argument were developed, there would be no reason at all for the subsidy. If the Bill will benefit and improve the pig industry of this country, I am not prepared to put any undue obstacle in its way, and if it is possible in Committee to improve the machinery of so complicated a Measure, I shall take that line.

I turn now, not to the technicalities of the Bill, complicated as they are, but to two or three specific points on which I hope the Minister of Pensions will be able to reply later. The Minister of Agriculture, in introducing the Bill, made no mention of the domestic producer of bacon—the ordinary cottage holder who in the past for many years has been proud to produce his one or two pigs for his own domestic consumption. That is a very important side of the pig industry in this country. The Bill seems to be concerned very largely with the big producers of pigs in the country, but I want to know whether the working man who desires to keep a few pigs on land attached to his cottage for the use of himself and his family, whether he is an agricultural labourer, a miner, or whatever he may be, will receive the benefit of this subsidy. It seems to me that, if he does not, there is something wrong in the machinery of the Bill.

If the Bill offers a subsidy of 8s. 6d. per cwt. towards the purchase of feeding stuffs for the production of pigs, what reason is there why that subsidy should not be handed to the working man who keeps a couple of pigs for his own use, as well as to the people who produce large consignments of pigs which they pass on to a factory? I understood the Minister to say, in his opening speech, that a number of producers of pigs might enter into some sort of group contract in order to obtain the benefits of the Bill. His actual words were that group contracting will benefit, and be permitted to benefit, within the meaning of the Bill. There are in this country hundreds of societies where, working men enter into some arrangement for the purposes of breeding and rearing pigs, and, if the Minister means that a society of ordinary pig-keepers will be entitled to the benefits of the subsidy, that would satisfy my point of view with regard to this aspect of the question.

I am profoundly interested in the work of land settlement in this country, and I claim that the Land Settlement Associa- tion is doing a very important work. We all know that dozens of families are, with Government assistance, being brought from the distressed areas and settled on the land. I think between 2,000 and 3,000 families from the distressed areas have been settled under land settlement schemes of one kind or another, and pig rearing is one of the main purposes and functions of the land settlement organisation. I am advised that, when these land settlement schemes have been fully developed, it is estimated that between 400,000 and 500,000 pigs per year will pass through the hands of the Land Settlement Association. I see no reference in the Bill to an organisation of that kind, and I suggest that, when the Development Board is set up, the Minister would be well advised if a very large organisation like the Land Settlement Association, which will probably be the biggest producer of pigs in the country, were given a seat on the Development Board, because of the number of pigs that are likely to be produced and of the peculiarity of the organisation.

If it be the case that the single individual producing pigs is ruled out of the benefits of the subsidy, we should want a specific reference from the Minister himself with regard to an organisation of this kind, and if he can satisfy me on these points it would clear my mind considerably. There is not only the individual cottage producer of pigs, the group of working men who enter into an association for the purpose, and the Land Settlement Association, but there is also the question of the smallholder, there is the question of group holders, and there is, the question of the farm labourer. If these points are met, my mind will be considerably eased towards the Bill, and I hope the Minister in his reply will give consideration to the points I have attempted to raise.

8.11 p.m.

Mr. Spens

I rise to support the Bill from a rather different angle from that of other speakers. As some hon. Members know, I have for the last three years been one of the two appointed Members of the Bacon Marketing Board, and I have been through the many difficulties with which the Board has been faced during that period. I welcome the Bill whole-heartedly, because I believe that it tackles the main difficulties which have been holding up schemes during the last three years. The Bill has been severely criticised by some hon. Members opposite, both above and below the Gangway, and by one hon. Member below the Gangway on this side, but I would remind the House that the situation in which the scheme now finds itself is a result of the organisation set up by the Agricultural Marketing Act, 1931, which was passed through this House by the votes of hon. Gentlemen opposite, both above and below the Gangway. It provided the machinery of a producers' board from the point of view of the pig producers, and a curers' board from the point of view of the curers. Those two boards were in due course formed and set to function in accordance with the provisions of the Act of 1931, and it is worth while pointing out that this is the one and only fully developed scheme under that Measure where you have, not only a producers' board, but also a board from the secondary industry.

One of the troubles of that machinery is undoubtedly that the producers' board has to sell the product to the secondary industry's board, which has to buy it, and you have bulk contracts between the two. Year by year, or at shorter periods —in this case the contracts are yearly for obvious reasons—those two contracts have had to be arranged between the two boards. It follows that the producers' board has always had to try to get from the curers such a price as would enable the ordinary normal producer to pay his costs and make a profit, while the curers' board, representing all the curers, efficient and inefficient, has had to try to pay a price which would enable every factory to make two ends meet and make a small profit. That is the inevitable result of that machinery which was set up under the 1931 Act.

I have been bold enough to say in public that that, in fact, results to some extent in stabilising inefficiency. That is so, because, on the one side, you have a board having to offer a price sufficient for the less efficient producer, and, on the other side, you have a curing board having to try to pay a price sufficiently low for the less efficient factory. That has been an impossibility, because whatever the curer gets, or whatever the producer gets, ultimately has to come from the price the consumer is willing to pay for his bacon in this country. Unless the consumer had been willing to pay abnormally high prices, it would have been quite impossible at any time to have continued on the basis I have put before the House. That was realised some considerable time ago. It is true that the scheme started functioning after the great imports of 1932 and 1933. Hon. Members opposite are right when they say that the price which the ordinary consumer paid in 1936 and 1937 was higher than the price he paid in 1932. The hon. Member for the Forest of Dean (Mr. Price) rightly said that never at any time since this Government came into office has he been able to buy bacon as cheaply as in 1929. At the time of the slump we got these large imports, which brought the price paid by the consumer to a very low figure, but it had brought down, and was bringing down, disastrously to the country, the production of pigs in this country. In 1934 it had come down to under £1,000,000 cwts.

What would have happened if we had not passed the marketing Act of 1933? My view is that had we gone on for another year, after 1934, with these large imports of foreign bacon, we would have lost our curing industry altogether. No curer could have survived, because there were not the pigs being produced in this country to make any factory an economic proposition. That would have resulted, I believe, in a shutting up of the bulk of the factories in this country, and the passing of the whole of the bacon supplies for our home market to the Danes and other foreigners. I do not want in the least to be rude to the Danes. I regard the Danes and some of the Danish importing companies as being among the most astute business people in the world. But they are not philanthropists; and if they had got control of this market of ours you would have found, by 1935 or 1936, the price of bacon in this country going up so that very little would have been available for anybody except those who could pay a very high price. We were determined that we were not going to allow pig production in this country to go out of existence if it could be prevented, because, of all the subjects of marketing schemes, pigs are the one which ought to be the greatest success in this country.

I believe that the consumption of bacon in this country runs into 11,000,000 or 12,000,000 cwts. a year. Under these schemes we have never produced more than between 2,500,000 and 3,000,000 cwts. of bacon. There is scope in this country to get a pig and bacon industry which would really be a fine foundation for agriculture generally. What have been our troubles? We had this difficulty, of the two boards having to negotiate for years on what is economically a false basis. If you are going to get the pigs you must be in a position to offer a price which will induce the producer to produce them in large quantities. Having got the pigs in large quantities, you can get your factories working at 75 per cent. to a 100 per cent. throughput, and reduce the overhead expenses, and thereby get cheap bacon for your people. That is what we have to effect in some way.

The first thing I thank my right hon. Friend for is that the Government have come in and offered this subsidy to these two industries. Had we anything like £1,000,000 to play with last year when we were negotiating a price between the two boards, I think that there never would have been a breakdown. But, on the other hand, one realises that it is not even a statesmanlike suggestion that the State should hand over a sum of money, unless it is accompanied by something that is some security to the consumer that the greatest economy and efficiency is going to be established in the industries concerned. Therefore, the Government, realising the sad fact that in present circumstances you cannot sell bacon in this country at a price sufficient to keep producers in production and curing factories with that 75 per cent. to a 100 per cent. throughput, said: "If we are going to help the industry, the industry must put itself in a proper state."

Therefore, as a condition of the subsidy to the industry, comes what I think all of us—certainly all of us on this side, and those hon. Members below the Gangway opposite—loathe, the condition that the industry must be rationalised. I do not know what the other hon. Members opposite think about rationalisation; I know some of them hate rationalisation when it is to be applied to them. The hon. Member for South Bradford (Mr. Holds-worth) inveighed against every condition of this rationalisation. He said it was monstrous that factories should have to be licensed and that it should be possible to eliminate, in any shape or form, inefficient factories. It is not monstrous, though it is extremely unpleasant; but it is obvious that if you have at the present time only about 2,000,000 bacon pigs coming forward every year and a curing capacity of between 4,000,000 and 5,000,000 cwt. of bacon per annum, you have not the pigs to get the factories working at a 75 per cent. curing capacity.

We are not restricting the output of pigs. Under the Bill the output of pigs is to be encouraged as much as possible. I listened with anxiety to what was said by my hon. and gallant Friend the Member for Maldon (Sir E. Ruggles-Brise) and other hon. Members representing agricultural constituencies such as mine, as to whether or not the pig producers will be encouraged by the assistance they are to get. I believe—and I am hopeful from what I have heard from them—that the pig producers are to be encouraged under the Bill, and that we may look forward to the figure of about 1,800,000 bacon pigs to-day going up, within the three years, to 2,500,000 which will get the subsidy. If it does, and if, at the same time, the rationalisation scheme is to cut down inefficient curing capacity, we ought at the end of three years to have pigs sufficient to give to efficient curing factories something like 75, 80 and 85 per cent. throughout.

Mr. R. Acland

Did the hon. and learned Gentleman mention the time within which that should be done?

Mr. Spens

I said within three years. It is obvious that you cannot suddenly bring a hammer down and simply say to 10, 15 or 20 factories, "Out you have to go." That is not a method of rationalisation which, I believe, any of us would carry out. Rationalisation must be by laying down standards of efficiency to be complied with year by year and month by month, eliminating those that cannot reach it. I believe that something of that sort will be done. I would remind the House that, in addition to the home-produced pigs which are being cured in the factory, there is an increasing number each year of foreign imported carcases also cured in the same factory, which contribute very largely to the total output of home-produced bacon and the reduction of overhead costs. Therefore it is not right just to compare the figure of 2,500,000 home-produced pigs with the total curing capacity of the factories if we want the surplus curing factories to deal with imported carcases which are cured here.

I agree with every word spoken by hon. Members opposite that it is of the very essence of this scheme that rationalisation should be effective. From what I know, I believe that an attempt will be made to make it effective during the period. That is really, looking at it big and large, the scheme. If the price, assisted by the Government subsidy, is such as to produce the requisite increase in the number of bacon pigs, and if, at the same time, you reduce and get rid of your surplus, inefficient curing capacity, and you get increased efficient capacity, there is no reason at all why, at the end of a period, the results should not be that we shall have 70 or 80 per cent. throughput in every factory. The factories ought to be able to produce bacon economically, and, as the volume increases, the price should come down. I am sufficient of an economist to believe that with factory production, if you get the volume through the factories, you can get the price down for the public at large.

I will deal with one or two of the criticisms which have been made by hon. Members opposite. Small curers are being put in a specially favoured position. The hon. Member for Lincoln (Mr. Liddall) and the hon. Member for South Bradford (Mr. Holdsworth) are anxious about that. It is true that they have to procure a curer's licence, but the only condition that they have to comply with is that their premises shall really comply with the regulations of the Ministry of Health, which is absolutely essential. No doubt some hon. Members know the kind of shacks which I have seen from which some of the bacon comes. They are a disgrace to this country. However, much of my sympathy goes to small curers, and, at any rate, there must be a decent standard of hygiene observed by some of them. As long as they remain small curers they do not come under any of the restrictions of the rest of the scheme. There is nothing to stop the self-made man, if he wants to expand his business, from doing so, provided that, the moment he wants to pass from the freedom of a small and untrammelled curer into the larger class, he submits to all the other restrictions. He has to come into the rationalisation scheme. There seems to be no very great objection with regard to that.

There has been a good deal of criticism about the restriction on imports. We have heard at least three methods for the control of imports mentioned. The quota control of the Board of Trade has become more and more efficient and flexible during the last three years. If, as has been the case from time to time during the three years, owing to sickness or some other reason there has been a threatened shortage of the accepted quantity coming from home factories, the Board of Trade have been compelled, sometimes in the view of the home curers much to their detriment, to let in extra quantities of foreign supplies. It has been, and is, very easy, and from fortnight to fortnight that system works with great flexibility. It is based on what are now the regularly ascertained figures of the bacon coming forward at short intervals from the home factories, so that the Board of Trade know exactly what is coming on to the market and can bring in the foreign supplies as required. In that way the public demand, such as at holiday times and so forth, can be catered for according to requirements.

Another system that has been mentioned is that of the levy subsidy. I have much sympathy with it, but I do not believe that actually it is so effective for the industry. I believe that foreign countries are able to get round it more easily than they can get round our present quota system. When the hon. Member for the Forest of Dean (Mr. Price) talked about an import board which was to buy abroad and bring bacon into this country, I puzzled my head to see how it differed, so far as requisite supplies are concerned, from the import system at the present time. I could not understand it. He talked about the Socialist view being that there should be an import board to buy supplies of bacon abroad as required. Our present system enables the Board of Trade to let in supplies as they are required without the risk and expense of buying fixed quantities of foreign bacon and hoping to put it on to the market here as best they may. It would not be the slightest use to sell it at less than the price obtained for the home-produced bacon; otherwise you would have at once a set-back to the whole of the home industry, and once again we would have exactly the sort of thing from which we had previously suffered. We should have to sell it at more or less a stable price, which is exactly how the system is being worked to-day.

As the demand comes forward for bacon, so bacon is either produced at home or let in from abroad. The scheme broke down in January of last year as a result of certain circumstances in this country which no one anticipated, chiefly the unexpected rise in the cost of feeding stuffs; but it is very important to realise that during the first year of the scheme home-produced bacon, which in 1934 amounted to 1,485,000 cwts., rose in 1935 to 2,028,000 cwts., a rise in one year of 36 per cent. There was a further rise in 1936 of another 14 per cent., to 2,800,000 cwts. We had a set-back in 1937 of about 150,000 cwts.—I cannot remember the exact figure—owing to a breakdown in the scheme; but so long as it was possible for that scheme to function it was definitely in the interests of the home pig producer and the home bacon curer.

The chief change which the Bill brings about, in addition to the financial assistance, is the establishment over the two subsidiary boards of a new Bacon Development Board, to which will be given powers such as the present Bacon Development Board does not possess, powers under which it can lay down a policy for the two subsidiary boards and give them directions from time to time. Looking at the matter from the point of view of the pig producers and the bacon curers, who are making their living out of the two sides of the industry, the new arrangement means that they are committing their future for the next three years to the new board, because the whole policy and the detailed directions can be given by that board. The hon. Member for East Ham South (Mr. Barnes), in referring to the board, spoke about a number of persons interested in the industry. The new board is to consist of five persons appointed by the Minister, with four representatives of the subsidiary boards sitting on it. It is obvious that the five independent persons to be appointed by my right hon. Friend will have the control in the next three years of this great industry.

Looking at the matter from the point of view of a Conservative, it is a severe measure to welcome a scheme under which five gentlemen are to be given that control, but on the other hand it means dealing with the difficult buying that went on in the last three years between two independent boards, with no body to settle their differences for them finally, constantly having to come to my right hon. Friend and his predecessor to ask for assistance in this and that difficulty. The new board really means a tribunal which will have the final say when the two subsidiary boards differ in their views, as they have done from time to time in the past. Although it looks like setting up a very powerful body over both branches of the industry, I believe that it will function much more as a consultative and conciliatory body, a body which will come to the rescue when the two subsidiary boards get at loggerheads once again. Therefore, I believe it is good machinery.

The House and the country ought to realise that this new scheme does depart from the old producer control which was promised when the marketing boards were originally brought into existence. Experience has shown that some special independent body is required, when you have under a fully developed marketing scheme a producers' body and a secondary industry body, because although those bodies must deal with each other on strict business principles, they must find themselves at arms length from time to time. Therefore, such a body as is to be authorised is needed to assist them to function, and I welcome this part of the scheme. If you are to have control, it is safer in the hands of a body where the majority will be five independent persons, with no interest in the trade concerned, a body more like a permanent arbitral tribunal, as far as these functions are concerned, than is the case in the other marketing boards.

I believe, therefore, that the main provisions of the Bill will help us out of many difficulties that we have had in the past in administering these schemes. It will provide us with a solution of our difficulties, and I hope that the pig producers will come forward and support the scheme. In that case, I look forward to the new scheme in the next three years making great progress in establishing what can be established in this country and what I believe to be essential, namely, a really big pig-producing in- dustry, accompanied by an economic and efficient bacon-curing industry.

8.42 p.m.

Mr. Acland

I have listened with interest to what has been said by the hon. and learned Member for Ashford (Mr. Spens). I hope that I understood the drift of a number of his remarks. For example, he told us that the self-made man will quite early find his way into this bacon-curing industry under the new provisions. I suppose he will do so in very much the same way as the steel works at Jarrow found their way into the British Iron and Steel Federation. I think I understood another statement, when he said that in 1933, as a condition of receiving import duty restrictions, there came an obligation to organise. I hope that as a condition of the industry receiving £1,000,000 of Government money under this scheme there comes an obligation to rationalise. I wonder what is the difference between the two obligations, and what it is that the industry will be obliged to do in three years' time in order to receive the further favours which I suspect will be asked at that time.

Mr. Spens

That is rather an important point. Under the existing scheme the Bacon Marketing Board has no power whatever to impose conditions on a factory or put a factory out of existence. Rationalisation is going to give those powers to somebody.

Mr. Acland

Later on I will come to the question of the improvement that will be effected by rationalisation. My main purpose is to develop a little further a point made in a brilliant speech by my colleague the hon. Member for South Bradford (Mr. Holdsworth). There used to be a theory, in which I was instructed at Oxford, about private enterprise. That theory was that a number of separate producers would compete with each other and the price and the volume of the output were settled as a result of their competition, not as the result of any deliberate decision by anybody, but as the result of a number of small decisions taken by a number of separate men. It followed, according to this theory, that the more efficient producers flourished for the general benefit of consumers and employés alike, and that the less efficient were driven into bankruptcy, which was regarded as a harsh but a necessary and beneficient pruning-hook of the economic system. That is the economic theory which is supported by the party to which I belong.

I do not expect that fact to impress the Minister or hon. Members opposite in any kind of way, but I would ask them to remember that it is the theory with which they repel suggestions made by hon. Members above the Gangway. Whenever one listens to a speech by an hon. Member opposite in opposition to Socialism, or speeches which are made at chambers of commerce dinners, reliance is always placed on the theory of private enterprise, competition, and the power of bankruptcy in weeding out those who are not sufficiently competent to render service to the State. Now the Government, month after month and year after year, are tearing that theory to shreds, throwing it overboard. In this Bill we are taking a step in advance of any previous Measure. No producer may sell bacon except under a long-term contract. The Pigs Marketing Board fixes the price, 12s. 6d., 12s. 5d., and 12s. 3d. per score in the next three years. Incidentally, may I ask what happens if on the introduction of the scheme the market price is rather above 12s. 6d. per score? Do I take it that the price in the Bill will carry with it a rather higher price for Grade A and a rather lower price for Grade C pigs, or that there will still be a payment of a higher price for those pigs which conform to certain standards? With that feature of the scheme I am in agreement, and I hope it will be retained.

Mr. W. S. Morrison

That feature of the scheme will be retained.

Mr. Acland

I am glad to hear that. Then Clause 23 says: There shall be added to, or, as the case may be subtracted from, the price per score of twenty pounds dead weight which would otherwise be paid under a long contract in respect of any pig due to be delivered in any month one hundred and three one hundred and twentieths of the amount by which the price for that month of the standard ration for pigs exceeds, or, as the case may be falls short of, eight shillings and sixpence. And the State pays the curer any amount by which the price of bacon falls less than 94s. 9d. per cwt. We have, therefore, a scheme in which no one whatever is concerned with securing that feeding-stuffs shall be as low in price as possible and in which nobody inside the industry is financially concerned with the price of its product. That seems to me a remarkable state of affairs. Where is the stimulus to efficiency to which hon. Members opposite pay so much attention when they are demolishing the case made by hon. Members above the Gangway? One can understand the stimulus to efficiency in Russia, though perhaps we may not appreciate it or think it suitable to this country. The industry there is in the hands of civil servants, who are apt to be shot if production is not up to the standards laid down. There is there a very effective stimulus. But where is the stimulus to efficiency in this Bill? Here you have an industry which is in the hands of two boards, one of which consists fully, and the other as to a majority of its members, of men whose perfectly legitimate function, so long as they are competing with other, is to make money out of the industry.

I disagree with the hon. and learned Member for Ashford about the impartiality of the Development Board taken as a whole. I quite appreciate that where there is a dispute between producers and curers, who have four members on the board, that the five members appointed by the Minister will judge the dispute impartially, but when there is an issue as between the industry taken as a whole and the public, then I cannot appreciate the argument of the hon. and learned Member, who seemed to suggest that this would be an impartial board, consisting of five impartial members and eight other members who are interested in one way or another in making money out of the industry. I cannot regard that as an independent tribunal.

I suggest that this is a vital issue. An hon. Member opposite mocked at the way in which hon. Members above the Gangway vote on the question of coal. When hon. Members above the Gangway introduce a Bill which puts into the hands of the producers complete control of the coal industry hon. Members opposite say that it is a most wicked and iniquitous thing to do. Surely they must appreciate that the same thing applies to the industry with which we are now dealing. If hon. Members opposite are determined to eliminate competition completely from the industry, if they are going to put the industry into the hands of a board, I submit that that board must be 100 per cent. independent, and must not be too tender of the financial interests of the bacon-curing factories. These bacon-curing factories are said to be redundant. Then surely some of them ought to go broke, some of them ought to disappear without any sort of compensation at all.

It is all very well to suggest that they are to compensate each other in some magical way, but I cannot help thinking that in working out the prices which are to be fixed as between the curers and producers and the curers and the public, some allowance is to be made for the contribution which both producers and curers will pay to the boards out of which the compensation will come. The compensation is definitely to come from the public and not from the industry. I wish to ask the Minister whether he will give some real expression of faith as to the results which this rationalisation will produce, because I do not think the Bill suggests that he has very much confidence in what he himself says is the main feature of the Bill. The hon. and learned Member for Ashford said that in three years' time the factories ought to be dealing with a throughput of 75 per cent. or 100 per cent., and that that would produce epoch-making results upon the position of the industry. As far as I can gather from the Bill, however, the Minister anticipates that those wonderful results will be limited to 1s. a pig. The cost of the pig is to go down from 12s. 6d. to 12s. 3d. a score, and if one takes an eight-score pig as producing a little over one hundredweight of bacon, it means that for the curer the purchase price of one hundredweight of bacon will go down 2s., but that the sale price in those three years will go down only from 94s. 9d. to 91s. 9d., that is to say, by 3s. Therefore, am I right in suggesting that the Minister's estimate of the economies to be achieved under rationalisation is limited to approximately 1s. a pig? If that is so, why has there been so much eloquence about rationalisation? If it is not so, if rationalisation will produce much greater results than 1s. a pig, why are those results not reflected in the prices quoted in Clause 24 of the Bill?

I revert to the point that, in order to eliminate competition, there should be a hoard which is entirely disinterested in the industry from the financial point of view, and that it should be interested solely in producing the physical con- ditions in which the industry will best flourish. I think all the boards that have been appointed have fallen on that score. In regard to milk, for instance, although one must congratulate the Minister upon an admirable piece of price-fixing machinery from his point of view, has he succeeded in improving the physical route which any gallon of milk takes on its course from the cow to the lips of the consumer? I fear not. I suggest that in the pig and bacon industry there are two physical reforms which most pressingly need attention, but which are not emphasised in the Bill. I do not wish to pretend that I am an expert on this question, for I am not, and I am merely repeating what was said to me—and what has no doubt been said to others—by a very prominent agriculturist in Denmark, a former Minister of Agriculture in that country. The first, and perhaps the most important, improvement that is needed is that the whole basis of our pig industry should be the return of skimmed milk to the farm. The rearing of the pigs should be done in conjunction with dairy production; the milk should go to the butter factory to be made into butter, and the skimmed milk should go back to feed the pigs on the farm. I wish that I saw a prospect of that taking place under this Bill, because I believe it is essential.

The second physical improvement which I regard as being so necessary, now that we have begun to approach towards a standard pig—and I must congratulate the Minister on the results that have been achieved by the differential price, which I am glad is to continue—is a rapid approach to standard bacon. All through the Bill there are regulations limiting the total output of bacon, and in Clause 26, Sub-section (1, a) there is a provision which may mean that the Minister is going to insist that standard bacon shall be produced. The hon. Member for Lincoln (Mr. Liddall) assured us that we could already get standard brands of bacon. I think it must be agreed that one is able to buy Danish bacon in qualities which are invariable and recognisable from one end of the country to the other. With regard to English bacon, however, it is a common experience that when one tastes somewhere some bacon which one thinks is the best one has ever tasted, and is assured that it is British bacon obtained from a little shop in Kendal, for instance, or wherever it may be, and one asks, "Can I get it in Exeter?" the answer is, "No, I am afraid you cannot." I am wondering whether the Minister really means to take vigorous steps to bring that state of affairs to an end.

9.1 p.m.

Major Sir George Davies

I am tempted to take up the alluring suggestion made by the hon. Member for Barnstaple (Mr. Acland) and to trace the similarity of him and his colleagues with a celebrated character in "The Pilgrim's Progress," known as Mr. Facing-Both-Ways, or a man in a rowing boat who is looking in one direction while he is proceeding in the other. I will, however, confine myself to the Bill. It is not surprising that a Bill of this magnitude, containing 51 formidable Clauses and five Schedules, should lay itself open to criticism, not to say anxiety, from both sides of the House. Hon. Members opposite, led by the hon. Member for Don Valley (Mr. T. Williams), complained that there is not in it enough real Socialism, and some of my hon. Friends are a little bit perturbed by the amount of Socialism that there appears to be in it; so that I think those two arguments may be set off against one another.

I would like to come to what I consider to be the heart of the Measure. This purports to be an agricultural Measure dealing with agriculture. Bacon is not an agricultural problem, but a manufacturing problem, and it is the pig which is the agricultural problem. As I read the Bill, it is primarily concerned with the prosperity of the producing side, the farmers who produce the pigs. The elaborate superstructure of the organisation of the manufacture of bacon, necessary as I regret to say it is, is not the primary object of the Bill, The hon. Member for South Bradford (Mr. Holds-worth), who interested the House so much with his speech earlier in the Debate, said that his constituents in South Bradford could eat much more bacon if it was presented to them at a price which they could afford to pay. I ask the hon. Member whether he would like them to get that bacon at the cost of having a sweated industry. I think it would do the hon. Member a great deal of good if, for a while, he would give up eating bacon and take to producing pigs, for he would then have quite a different outlook on the basic problem.

We have always been a market for other people's agricultural produce, and not an exporter. In many directions of our agricultural industry we cannot hope to produce enough to meet our own requirements, but there are a few directions in which we can do that, and it seems to me that the production of pigs and bacon is one of the directions in which we ought to be able, in due course, to be self-supporting. I think that is something which all hon. Members would like to see achieved. Therefore, as I see it, this measure is primarily a step towards increasing the pig production in this country and thus giving a less wide market to supplies from overseas, whether from Empire or foreign countries. As a practical farmer, I think that the crucial factor is the producer of the pig. Just as the hon. Member for South Bradford said that his constituents would eat all the bacon in the world as long as it was within their means, so I can say that every farmer in the country would produce pigs if he was going to get a little more than a new shilling for an old one expended.

That is the real point at issue. What in the past caused the breakdown of the schemes which we had in operation, was a factor which no one in this country could control. That was the exorbitant increase in the cost of feeding-stuffs. The cost to the farmer of every hundredweight produced became so high that the price which the processors could afford to pay him did not make it worth his while to go into that line of country any further. If the hopes of the Minister and of many of us are to be fulfilled as the outcome of this Measure, the fundamental point to be considered is: Are we making it sufficiently attractive to the reasonably efficient farmers to extend the pig-producing industry? They will only go into it if it is sufficiently profitable for them to do so. Let us be clear about that. No farmer with any sense is going into it if he sees in front of him the prospect of a complete loss.

Therefore, I come down to those provisions of the Bill which I regard as being directly aimed at that object. The first thing to which I would draw attention, is what is called the formula which relates the price to the cost of feeding- stuffs. I think the idea of the formula is sound, but if our ambition is a rapid and substantial increase in the number of pigs produced, I am a little dubious whether that formula will be sufficiently attractive to get what we want. The next thing on which I wish to touch is the question of the period of the formula and notwithstanding what was said by the hon. Member for South Bradford I think my hon. and gallant Friend the Member for Maldon (Sir E. RugglesBrise) expressed a perfectly commonsense view on that subject. If a farmer is to expand the production of pigs, it is necessary for him to put in certain plant and construct certain premises. To do the thing efficiently to-day, it is not sufficient to adapt some tumble-down barn, built perhaps a century ago for quite another purpose. It is necessary to have reasonably up-to-date buildings and just as in a manufacturing industry, no man is going to put up a new factory—if one may use that word in this connection—if he thinks that in three years time it is likely to be useless and left on his hands or utilised only for the keeping of poultry or fattening a few cows or something of that kind. He will want more security of tenure. The Bill only offers him three years security of tenure.

I do not dogmatise on the question of whether that will deter the farmer from seeing other advantages in the proposals of this Measure, but I do say that if we wish to achieve our object in the shortest time that is reasonably possible, this point of view of the encouragement to be given to the producer of the basic article must be taken into consideration. I echo the words of my hon. and gallant Friend the Member for Maldon on the point as to whether the three-year period provides a sufficiently long guarantee, from a purely business point of view, to induce landowners or tenant farmers or indeed smallholders—though in their case of course the premises required would be less ambitious—to undertake this capital expenditure with the possibility, if not the probability of the equipment becoming useless at the end of three years.

My third point is connected with the same idea of the encouragement of the home producer. It relates to what has been, of course, scoffed at by the hon. Member for South Bradford, namely, the regulation of imports. When we enjoyed the inestimable benefit of the cheapest possible bacon, let us remember that it was being done at the expense of pauperising those who produced the article whether here or abroad. It was being done at a wholly uneconomic rate, which no hon. Member opposite, from the point of view of sweating labour alone, would ever support. Their whole record supports the idea that they believe in the workman being worthy of his hire, and if that applies to coal, it also applies to pigs.

Mr. Holdsworth

I was waiting to hear the hon. and gallant Member say at what I had scoffed. The last thing I want to do is to scoff at the producers of pigs. What I said was that I could not understand why the producers in this country should be unable to work on a voluntary basis like the people in Denmark. I see no reason why we should not produce our own pigs, but I think we could do it without all these proposals.

Sir G. Davies

I said that what the hon. Member scoffed at was the idea of restriction of imports. I do not know whether he objects to the word "scoffed" in that connection, but he certainly poured cold water on the idea. I think it is a common sense idea. Hon. Members opposite go so far as to say that, given certain conditions, they would put the bar down and say "no more importation." That is the apotheosis of control of imports. We do not go as far as that, but I take the view, which I do not think can be controverted, that among the many difficulties which this industry has had to face, has been the swamping of the home market with foreign or Empire produce making it impossible for our own people to continue to produce at a profit. Surely it is only common sense to regard that as one of the factors which must be taken into consideration. If we are driven, as I reluctantly admit we are, to have all this superstructure of control and direction by Government appointees and boards and commissions, whether appointed directly or indirectly, then to leave one factor untouched which might easily wreck the whole scheme, would seem to be the negation of statesmanship.

It is true that if it were to go to an extreme point and if, merely in order to prevent imports coming into this country, the consumer were compelled to pay artificial and unjustifiably enhanced prices that would be a wicked thing to do. But if it means that, in common with the other controls provided for in the Measure, there is a system here whereby the matter can be balanced then it is a common sense proposal. I can assure the hon. Member for Barnstaple (Mr. Acland) that there is a longish lag before a man goes into bankruptcy. A man may stick on for a long time and may cause pauperisation and misery to a good many of his colleagues before he goes into bankruptcy. I do not think we can afford to wait if we are to deal with the situation caused by the uncontrolled swamping—I will not use the word "dumping"—of our markets with more than those markets can properly absorb. The result, I agree, for the time being is an artificially "dehanced" price, if I may use the word, for the consumer, but it would be at the expense of a sweated agricultural industry, both here and in other parts of the world.

Therefore, I feel that we have to give a certain amount of confidence to these organisations, or commissions, or boards, or whatever they may be called. I dislike red-tape as much as any hon. Member opposite, but these bodies are inevitable in the circumstances. If we have to do that, then the Bill encourages us to think that these matters will be capable of a real and proper balance, between holding out the prospect to the farmer of getting a reasonable price for his products as a result of efficient operation and a reasonable prospect to the consumer of getting his bacon at a price which is regarded as fair in all the circumstances.

For those reasons, I think this Bill is a necessity—to me, a regrettable necessity. As I have said, I hate all this red-tape administration, but at the same time I urge the Minister to bear in mind what I have tried to say. My whole idea of the basis of this Measure is that it should encourage and increase the production of pigs in our own country by our own farmers, whether they be tenant farmers, occupiers, or small-holding proprietors, and unless by the terms of this Bill we can make it sufficiently attractive, we shall miss the opportunity and miss the point. If we can make it sufficiently attractive, I believe we shall have gone a great step towards achieving what in this particular line of agriculture we can achieve, and that is the provision of our own home consumption by means of our own home producers.

9.17 p.m.

Mr. Naylor

I would like to ask the Minister whether he is aware that this Bill makes a radical change, which may prove to be a very unjust one, to the small producers of bacon. In London you have a number of bacon producers who are exempt under the existing scheme; they are known as small producers because they do not produce more than 40 cwt. of bacon in any two consecutive months. Are we to understand that that exemption is wiped out by the present Bill? If so, what happens to these bacon producers who are now exempted by Statute if they apply for a licence and are refused that licence by the board? Apparently their businesses will be shut down. One would suppose that in a case of that kind—I think the provision should have appeared in Clause 10 of the Bill—some provision would have been made for an appeal against the decision of the board not to grant a licence. If the Minister refers to Clause 12, he will find that if a licence is revoked by the board, the holder of the licence has the right of appeal to arbitration, but no provision is made anywhere, so far as I can discover, for the small producer who is now exempt from the provisions of the scheme. This is a very serious matter to the small producer, and I am looking to receive the assistance of the Minister when he replies. I know it is a Committee point, but if he can assure me that he is prepared to make some provision for an appeal by the small producer who may be refused a licence, he will earn the gratitude of a large number of these small producers, not only in London, but in other large towns as well.

9.19 p.m.

Brigadier-General Clifton Brown

I think the point made by the hon. Member for South-East Southwark (Mr. Naylor) is one that ought to be answered, though I think it is a matter for the Committee stage. I was very interested in the speech of the hon. Member who addressed the House from the Liberal benches, when he was producing his theories about Free Trade and Protection and talking about the lack of a stimulus in this Bill. When he accused the Socialist party of believing in State enterprise and in the State run- ning these schemes, I thought of Russia, where the only stimulus is fear. The hon. Member who spoke from the Liberal benches seemed to think that bankruptcy was the stimulus, and he will not agree with me, I suppose, when I tell him that I think the control of imports, which allows free trade inside that control, is the necessary stimulus, which I think is more or less incorporated in this Bill. However, I do not want to talk about these abstruse matters.

Everyone knows that, as the old Sussex saying runs, "Pigs is pigs, and they won't be druve," and when you come to the pig producer—and I have been a small one in my time for some 10 or 12 years—he does not want to get a pig in a poke. When he looks at this Bill of over 50 Clauses, the ordinary farmer is very uncertain what he has got. I can very much sympathise with the hon. Member for Don Valley (Mr. T. Williams) in saying that it puzzled him, for certainly the same paragraph which he read out puzzles me. What we really want, as pig producers, is to know what price we shall get. Several hon. Members have made various calculations at to what it will or will not be, but there, after all, is the crux of the Bill, and if I might, without quoting the same paragraph that puzzled the hon. Member opposite, I would quote a few words from Clause 23, which is about Increases and decreases in price on account of rises and falls of costs of feeding stuffs. That is a very estimable object to have in view. But what does Sub-section (1) mean? It says: There shall be added to, or, as the case may be subtracted from, the price per score of twenty pounds dead weight which would otherwise be paid under a long contract in respect of any pig due to be delivered in any month one hundred and three one hundred and twentieths of the amount by which the price for that month of the standard ration for pigs exceeds, or, as the case may be falls short of, eight shillings and sixpence. I can imagine the farmer who wants to know, before he starts spending money on pigstyes and pigs, scratching his head as to what that really means in pounds, shillings, and pence to him. That is one of the points that might be cleared up.

When I looked at the Bill, I got through Clauses 1, 2, and 3, and I must say that I came to the same conclusion as did my hon. and learned Friend the Member for Ashford (Mr. Spens), who made a very knowledgeable and interesting speech, that really this Bill puts the whole power of administration into the hands of the Development Board. I cannot see the use of this top-hamper in any scheme, and I am no more in favour of boards than was my hon. and gallant Friend the Member for Yeovil (Sir G. Davies) or the hon. Member on the Liberal benches, but if we have a board, let us have a separate one. So far as I can see, Clauses 1 and 2 merely foreshadow the demise of the Pigs Marketing Board and the Bacon Marketing Board. The whole of these Clauses are about the relations between the marketing boards and about what you will do when the Development Board winds them up. It seems to me that they might be wound up to-morrow, for all the good they are. Then we shall know where we are.

If we are to have a dictatorship in the Development Board—which is what it is —it is important to know who are to be members of that board. I think we ought to know a little more about that, even on Second Reading. I should have thought a body like the Royal Agricultural Society of England would provide useful members, because it is really concerned with the producing point of view. On one thing I do congratulate the Minister, and I hope he will carry it out, though I agree with hon. Gentlemen on the Liberal benches that it will take some courage. He quoted the case of Denmark with 90 factories producing 2,000 pigs a week, while we have 700 factories and produce half that number of pigs. The sooner he makes up his mind to reduce our factories to a proper number, like Denmark, and make them large enough to deal with 2,000 pigs a week, the sooner shall we get better prices for our pigs and some organisation in our marketing. Unless our factories are organised on a big scale and we do away with a lot of these small factories, bacon will never be produced in this country at prices that pay, as in foreign countries.

I was a little uncertain as to how much the pork trade was to be interfered with. In one of the clauses power is given to the Bacon Marketing Board or the Pigs Marketing Board to control the output of bacon. Is it meant that the surplus shall go to the pork market, or is it to be left uncontrolled, exactly as it is at present? Some reference has been made, again from the Liberal benches, to the best way of feeding pigs, and it was suggested that it would be a good thing if some arrangement could be made in conjunction with the Milk Board and the milk industry for feeding our pigs. I quite agree with that, but of course we do not make enough butter in this country. You cannot get enough skimmed milk without making butter. If you want the best food for fattening pigs, skimmed milk is worth double anything you can buy. If something could be done to increase the butter industry in this country and thereby provide plenty of skimmed milk, there is no doubt that we should do something to do away with the high cost of feeding stuffs, which is the reason for the failure of the Pigs Marketing Board at the present moment. With these few criticisms, and hoping for the best, I shall certainly vote for this Bill, and I hope that producers and others will be very much benefited by it.

9.31 p.m.

Mr. S. O. Davies

The hon. and gallant Gentleman's speech seems to have summarised the confusion that inevitably prevails not only in the minds of the Government supporters in regard to this Bill, but also in the mind of the Minister who is responsible for presenting it. The hon. and gallant Gentleman put the position in a very apt way when he said that what he wants to know, and presumably what the Government supporters want to know, is where are we? I have heard most of the speeches delivered to-day, and the speech of the Minister and those from the Government Benches have been interesting, but almost painful to listen to. The hon. Gentleman who spoke last from the Liberal benches reminded us of certain economic doctrines that he was once taught at a certain educational institution. Those economic doctrines have been taught to many of us. We were taught in our younger days that competition was the very essence of the capitalist system—a magnificent structure expressing itself through human life and human effort. We were told that individualism in production was the high-water mark of human endeavour, and that there was nothing as sacred as free and unrestricted individual initiative. When I was a boy those were fixed, inexorable dogmas, but this Debate has made it clear that all those sacred things have now disappeared, hence the confusion among the supporters of the Government. Our economic system cannot be left any longer to individual initiative. Individualism is dead; competition can no longer be allowed free play, and this, as the Debate to-day has revealed, has landed the supporters of our present system in a hopeless and helpless muddle and confusion.

Where is the ideal of competition and individual initiative with this practice of pumping in artificial stimulation in the form of vast sums of money to keep the system alive? And this pumping process is going on at an accelerated pace. One hon. and learned Gentleman said this evening, "Give us another £1,000,000 to play with." A million pounds thrown into the pockets of private owners—it is a game, now expressed in the terminology of sport. This would be another million added to the tens of millions which are being pumped into privately-owned industry. No wonder that on more than one occasion to-day we have heard anxious expressions from the Government benches. We on these benches realise the source of that anxiety. The demand for this pumping of vast sums of money into the pockets of private ownership is obviously an admission that the system of unrestricted competition and so-called individual initiative would collapse in a very short time without it.

The principles on which this Bill is based can be summed up in a few sentences. What is the first objective of the Bill? It is, without a doubt, to restrict the supply of a helpful and homely commodity, and, by the process of restriction, to sustain artificially—and I say this deliberately—an impossible and prohibitive price to tens of thousands of working-class homes. The Government are ruled and dominated by one principle and one desire. That is to plan scarcity among some of the fundamental needs of our people. That is the political philosophy of the Government and their supporters. There is no suggestion in this Bill that anything like an abundance or a reasonable supply of bacon is to be produced in this country. The very essence of the Bill is a restriction of supply which will prevent an increasing number of families from having bacon among their foodstuffs.

This Bill talks about quotas, and the object is to restrict supplies. It talks about the licensing of bacon factories, and that is solely for the purposes of restriction. According to the Bill the Government are prepared to pay compensation for the restriction of supply. The Bill lays down several prohibitions to prevent the production of ample supplies of bacon. I repeat that there is no wonder that the spokesmen on the Government benches find themselves in the appalling confusion which this Debate has revealed. On the one hand, the Government deliberately plan a scarcity, and, on the other hand, deliberately plan a reduction of the purchasing power of hundreds of thousands of people. I can speak about my own constituency, and I have no fear of being contradicted when I say that in nine-tenths of the homes there bacon has entirely disappeared from the breakfast table. While the Government are forcing this Bill through the House they are reducing at the same time the purchasing power of tens of thousands of homes. When this scheme for creating an artificial scarcity and for increasing prices was introduced I could not help being reminded of the fact that in my constituency and in the constituencies of dozens of other Members, the Government are brutally and cruelly imposing sharp and deep cuts in the petty allowances to the unemployed.

It is unthinkable that any of us with constituencies of that kind should give any other than the strongest opposition to a Bill which will deprive thousands of homes of a homely and tasteful commodity which has already disappeared from the homes of many of our people. I shall be interested to hear the Minister of Pensions justify the present action of the Government. It is no use Members on the Government benches attempting to assuage their consciences by telling the Opposition that this is a measure of Socialism. It has nothing to do with Socialism. Socialism will never indulge in stupid contradictory piecemeal planning of this kind. There is no justification for restricting a commodity like bacon, on the one hand, and cutting down the purchasing power of those tens of thousands who are the victims of the means test imposed by the Government, on the other hand.

9.42 p.m.

Mr. Maitland

This Measure has been introduced by the Government for two reasons which may, at least, be some answer to the hon. Member for Merthyr (Mr. S. O. Davies). The first reason is that the Government recognise the importance to this country of the pig and bacon industry, and the second is that they recognise the value of that homely commodity to the vast majority of the people. The Government have an answer in anticipation to the complaints which the hon. Gentleman has made. I think he was wrong in suggesting that the Bill restricts the home production of pigs and restricts the curing of bacon. On the contrary, the Bill aims at increasing the home production of pigs and the present output of bacon cured. If these things were done—and they are the specific objects of the Bill—they would achieve what the hon. Gentleman says that the Government will not do. Surely it is not right to say that the Government are responsible for the economic conditions which prevail in the world to-day. The hon. Member said that individualism was gone and that free competition had ceased to exist. To a large extent that is true, because for the last dozen years practically every country has assumed a nationalism which has resulted in a great change in former conditions and made free exchange of trade almost impossible. The fact of the matter is that in existing conditions in the world we are compelled to adopt methods which we may dislike. Is it surprising that in the course of eight or 10 years, when dealing with agriculture, our oldest industry, with its many phases, many branches and many difficulties, the schemes which have been put into operation should in many cases not have fulfilled the hopes which they had inspired when first they were introduced? It has always seemed to me that whatever Government was in power, and whatever schemes were introduced in connection with agriculture, they must to some extent be regarded as experimental. They must stand the test of time and experience. Most hon. Members in all parts of the House have a great dislike to the setting up of boards and commissions. That dislike, no doubt, is based upon different motives. One motive is governed by the objection to Parliament deputing or delegating to an outside board or commission the power to settle important issues affecting an industry on one hand and the public on the other. Another motive may be that some of us do not like the idea that industries should be subjected to a control such as is envisaged in this Bill; but it must be recognised, in common fairness to any scheme put forward by this or any other Government giving assistance to an industry, that the Government are the trustees for public funds, and that if financial assistance is given there must follow some degree of control.

Mr. Gallacher

That is what we have always said.

Mr. Maitland

The hon. Member apparently entirely agrees with that view. I go a stage further and say that if we attempt to control an industry we shall probably find we should control it completely. The hon. Member seems to agree to that also, but that doctrine was not subscribed to by the hon. Member for Merthyr because he denounced the restriction of imports. We may not like such a restriction, but if we are to have a scheme which is to be really successful we must face all the issues, and one of the issues is how to deal with the imports which come from foreign countries. I admit straight away that this is the kind of Bill whose provisions can be subjected to fairly severe criticism from all sides of the House. What does it mainly purport to do? It purports to give financial assistance to one branch of agriculture, that of pig production which badly needs it. Some reference has been made to the amount which is to be given to it, and that is an interesting speculation, but at this stage—whatever may follow in other stages—according to certain assumptions and speculations it is estimated that the cost will be approximately £1,000,000 in a full year. I represent a constituency which is partially industrial and partially agricultural, and have among my constituents those who are interested in pig producing. I do not hesitate to say on behalf of those pig producers that I am grateful to the Government for making a further attempt to assist that industry, because I believe it to be an industry which is of importance to the country. I will not enter into any remarks on details but will only say to certain hon. Members above the Gangway who have objected to certain elements of control in this scheme that if they were to put into operation the principles which they advocate there would be an infinitely greater degree of control and the effects would be disastrous. I venture to say that the tepid criticism which has been launched against this Measure would be as nothing compared to the criticism which would develop against a Measure such as they would introduce.

9.50 p.m.

Mr. Alexander

We always like to listen to the hon. Member for Faversham (Mr. Maitland), who is always ready to put his views to us without rancour, and though we always disagree with him we do not mind what he says. The Bill before us is, as my hon. Friend the Member for Don Valley (Mr. T. Williams) said, one that had to come—not that we approve of it in all its details—because the pig industry had come to such a pass in relation to the bacon industry that unless something were done both the pig producer and the bacon curer would be in a very serious position. In the six months from June to December, 1937, bacon curers, who, in response to the bacon scheme which the Government had approved in 1933, had entered upon large capital expenditure, and had laid themselves out to provide a supply of British-cured bacon, found that not only was there a scramble for pigs because the contract system had broken down, but that the standard and grade of pigs for bacon curing, in which a steady improvement had been witnessed from 1934 to 1936, was deteriorating. They were no longer dealing with the same farmers and pig producers, but had to buy whatever pigs were available, of any size or grade, upon the open market.

If we were to replace some part of the imported supply with home-produced bacon of a sound level of excellence it always seemed to me to be essential to get a really high and level standard of graded pigs. In consequence of the deterioration during 1937 in the standard and grade of pigs supplied, there was great difficulty in holding together the trade which had been established with consumers of British bacon during 1934 to 1936; the bacon curer found he was having an exceedingly difficult time. Therefore, I entirely agree with my hon. Friend the Member for Don Valley when he said that we are not wearing our hearts on our sleeves—if I may put into his mouth words which he did not use—when we put down our Amendment, stating that we welcomed the reorganisation of the bacon industry, because it was overdue and very necessary in view of the deterioration which had set in. We also welcome—one of the few things that we welcome in the Bill—the inclusion of a fair wages clause. The Ministry of Agriculture are beginning to wake up to the fact, in their approach to this House and in seeking general support, that when one asks this House for credit or for an actual subsidy for an industry, there is very little chance of even the tepid support of which the hon. Member for Faversham spoke unless some reasonable provision is made for the workers in the industry. We therefore welcome the provision of the fair wages clause in this Bill, to be set off against the public expenditure which is to be involved in respect of the subsidy.

When we have got beyond those two points we become exceedingly critical. My hon. Friend the Member for Don Valley said that he was not going far from the Amendment on the Paper. He was almost immediately criticised because he did not give enough time to it. I do not agree with that criticism, but I want to give enough time to it. In this Amendment we say that the Government's proposals exclude an important part of the industry. We have been asked from various parts of the House, and I think the Minister asked us, what we meant by that. I see the position in this way: It is impossible for the Minister ever to secure in the bacon industry, in relation to pig production, a proper equation between the two sides of the industry, production for pork and production for bacon, unless you have a marketing system for the whole of the pigs produced. Even when you have a number of firm contracts, fluctuations take place. The contractors are not always ready, and you have to go on the open market. You immediately have fluctuations on the pork market to such an extent that the producer is tempted to take his pigs to the pork market even to the extent of breaking his contract with the Bacon Board. As long as that happens you cannot have a really permanent and successful basis for your schemes. The Minister knows that in conversations lasting over two years those whom I represent on the business side, as apart from the Parliamentary side, have never taken any other view than that if you are to have a successful organisation of the industry you must control pigs as a whole, and not merely those used for the bacon scheme.

I have something else in mind in relation to this part of the Amendment, respecting the exemptions in the Bill from the operation of the scheme. From what the Minister said this afternoon there is a very large number of bacon curers who produce a very small proportion of the total bacon supply. They only had to register in the past if they exceeded a total annual production of 12 tons per curer. In fact, many of those people did not produce up to 12 tons. You are to have the new datum line of 39 tons a year. Many of those producers do not produce up to 39 tons, but if in the course of the operation of this scheme such people, knowing that they are not now subject to the same restrictions that they had, they go on to the open market in company with other people and buy right up to the limit of 39 tons, there will possibly be a considerable disturbance of the scheme. In reply to the hon. and gallant Member for Maldon (Sir E. Ruggles-Brise), I would say that these words apply both as to the measure in which the bacon curer is to be affected and as to leaving out of control altogether pigs produced only for the pork market.

We come next in our Amendment to the statement, by which we stand, that the scheme still involves the State in further subsidy. By the way, I am not quite sure what the Minister had in mind in the procedure on this Bill. I should have thought that the new arrangement that we agreed to in this House in regard to Money Resolutions would not have precluded the Money Resolution being put on the Paper before this Debate took place. I welcomed very much the procedure that we adopted in regard to being able to debate a Bill before being cabin'd and confined by the terms of the Money Resolution, but it is advisable when we are actually discussing the Bill, to have the terms of the Money Resolution before us. That Money Resolution is not on the Paper to-day, and I should like to know why that is the case. We hope that it will not be regarded as a precedent for Money Bills of this kind in the future.

The subsidy has been regarded in different ways in different parts of the House. I was exceedingly amused by some of the speeches. The hon. and gallant Gentleman the Member for Maldon was not quite sure whether he wanted to come out firmly and say that the subsidy was not good enough, so he put it very tentatively and asked the Minister to say whether it had been so analysed and tried out that it was certain to be enough. The hon. Member for Leominster (Sir E. Shepperson) was much more certain in his approach. He said: "This is only three-quarters of a loaf. We ought to have the whole loaf." The rate of subsidy was about 25 per cent. short, according to him. I learned from my hon. Friend the Member for Don Valley some of the comments which were made while I was out of the Chamber, and I see that the tendency was repeated by other speakers. The hon. and gallant Gentleman the Member for Yeovil (Sir G. Davies) had a great fear that there was too much Socialism in the collective organisation of the pig and bacon industry, but he never thought that the figure in the formula was not sufficiently attractive. I understand that the hon. and gallant Gentleman the Member for Newbury (Brigadier-General Brown) who talked about the whole scheme as buying a pig in a poke——

Brigadier-General Brown

It is not right to tell tales like that.

Alexander

It is essential that we should know on this side exactly what goes on, as Ministers serve each other on the other side. It seemed to me that there was this mixed feeling among agricultural Members on the other side. It is a matter which interests me very much. I ought to have been present last week at the annual meeting of the Pigs Marketing Board. There was a meeting of the rank and file and I should have been there, but I had a representative there. I understand that the scheme was welcomed with open arms by the pig producers. There was the attitude of the Pigs Board—"You had better be careful, you farmers. You have a really generous scheme, and if you do not make use of it you may never get such another." There was the group of farmers who said: "This is a very generous scheme, and if we do not make use of it then companies will begin to exploit the raising of pig production and we shall be done out of it altogether." To cap the whole lot, there was the gentleman, evidently very successful, who rose from the floor at the annual meeting and said, "I think that what has been said is right. If you cannot make money out of pigs with this formula, you will never make any, and, what is more, I have never yet lost money by raising pigs." If that is the kind of attitude adopted by the people in the industry, I am not so much impressed by the vote-catching appeals for even more subsidy which have been showered upon the Minister from various Conservative quarters to-night, for it seems to me that it would be entirely unnecessary.

I have said that we recognise that reorganisation of the industry is necessary, but is this Bill going to do it any good? However much we may criticise controlled collective schemes of this kind, one thing will ultimately prove to be true. Those hon. Members on the other side who have criticised the Bill as containing too much Socialism have put their finger upon a point which is never absent from the minds of Members on this side. You cannot ultimately get a scheme of this kind to work on a national basis for national prosperity if it works along the line of compulsion upon the bacon curer, rationalising some bacon curers out of existence in the interests of the State, mulcting the consumer, at any rate for a period, and probably a long period, in high prices to induce production by the big producers, and then ultimately finding that the scheme has no real control at all over the primary producer.

You can vote your money, you can have your marketing schemes, you can compel the secondary producers to use the primary product; but what is happening is that the primary producer is then free to produce pigs this year, to switch off next year to cattle, and the following year, if cattle are not so good, to switch on to milk, if milk is not too good to switch back to cattle, and, if cattle are not good, to go back to bacon. They are playing Box and Cox with all kinds of subsidies and collective schemes, and, in fact, there is no real, co-ordinated mixed farming going on. The farmer is still a complete individualist, jumping off to the latest and most attractive commodity that he can find. I challenge anyone to prove, from the figures of production in this country during the last four years, that my criticism is not justified. If that be so, it is a very grave position, which will have to be met by whichever Minister is in office, whether he be Conservative or Labour. I am certain that you cannot go on pouring out £25,000,000 or £30,000,000 a year of subsidy into the agricultural industry and then finding that, with every variation of each separate commodity subsidy, the farmer leaves production of some important commodity because for the moment he is on something which is a little more attractive. There is no hope in that way of building up agriculture on a sound basis in this country.

We have been criticised during the Debate because of the remarks we have made, but, so far as the Labour view of co-ordinated marketing is concerned, we are not in any sense confined to the kind of administration of marketing which has been given us by the present Government. If I may use the words of my hon. Friend the Member for East Ham, South (Mr. Barnes), we do not want to treat marketing schemes by putting an enclosure around these commodities. It is impossible to treat food production on that basis. We are not against regulation of supply, in spite of the strong individualistic appeal of the hon. Member for South Bradford (Mr. Holdsworth), but we are very much against the kind of regulation we are now getting, where you have a most rigid control of the volume to be imported, without any assurance that the amount allowed to come in, plus the home production, is sufficient both for the actual consumption requirements and for the purpose of the price level to be aimed at in order that people may be able to buy the commodity.

If you take the revised figure set down by the Lane Fox Commission as being necessary in their view, which was based upon actual experience—I think the first figure was 10,600,000 cwts., and the revised figure 10,818,000 cwts.—since that figure s set down, the records given to us by the Minister of Labour show that the population has so increased, and employment has so increased, that we have 1,750,000 more workers at work, and, looking purely at the population figure, we have an increase of 1,250,000. But the Government still aim at the same basis of regulation of imports. The consequence is that you get an actual short supply, and, with that short supply, you have the maintenance of a price to the public which we do not say is without precedent—there have been other periods of high prices for bacon—but which we say, having regard to the purchasing power of the people as it is, is too high to maintain that amount of bacon consumption which will give the necessary stimulus to the industry. Indeed, in the last four years our returns in the grocer's shop—a very good census of the position—have shown over and over again that, because of the short supply and because of the price, large sections of the British population were steadily losing the bacon-eating habit. That is not good for the industry, nor, in my view, as I am rather fond of a rasher of bacon myself, for the population. Therefore, we criticise the scheme especially from that point of view.

I have not time to say all the other things that I wanted to say, but I would like to say this: In Denmark, they have been able to organise their primary producers so that they do not concentrate on one commodity in one year, on another commodity in another year, and on still another in a third year, because it happens to be a little more attractive. They have a steady, organised basis of production and sale. There is no reason why that should not be done here. If you want to do that, you must not organise solely from the point of view of restriction, but must organise from the point of view of stimulating the demand by having a reasonable price and a proper, level grade and standard for the commodity. You can organise as successfully for plenty for your people as you can organise for restriction, if you really like to face up to that problem. I do not believe that this system of pouring out money, as the Government have been very generously pouring it out for four or five years, to the agricultural industry, is really going to fulfil that purpose. In the meantime, there is a great deal to be said for the criticism which has been made, not only from this side of the House, but from the other side as well, that the way the Government have been working these schemes, with their pains and penalties and red tape, is such as not to help but to hinder what we all desire, a prosperous agriculture, a happy and contented agricultural worker, getting his fair share of the proceeds of the industry, and a consumer who is able to enjoy a proper standard of life.

10.16 p.m.

The Minister of Pensions (Mr. Ramsbotham)

I think the Government and my right hon. Friend have every reason to be satisfied with the reception given to this Bill. It is true that here and there I have detected in the speeches a note of faint congratulatory regret and, in one or two speeches, signs of sour and reluctant acquiescence; but in very few speeches—the exception, perhaps, being that of the hon. Member for South Bradford (Mr. Holdsworth)—has there really been whole-hearted opposition. The right hon. Member opposite and his colleague the hon. Member for Don Valley (Mr. T. Williams) have expressed their opinion in favour of certain portions of the Bill. It is true that the hon. Member for Don Valley felt himself bound to speak to the Amendment. I hope that I shall have time to show the House that there are signs that that Amendment, or the parts of it criticising the Bill, were prepared before the Bill was published, because they are directed not to what is in the Bill but to what hon. Gentlemen at one time or another thought would be in the Bill.

The hon. Member for Don Valley accused the Government of being weak-kneed, and of being ready to bark but afraid to bite. On the other hand, the hon. Member for South Bradford accused the Government of biting everybody. The hon. Member for Don Valley, in so far as he has opposed the Bill, appeared to oppose it for completely different reasons. That may give a certain amount of satisfaction to my right hon. Friend. The hon. Member for Don Valley was a little harsh in his criticism of the Bill, because he said that it placed a high premium on inefficiency of curing. If the hon. Member and other Members will study the Bill from now onwards, they will see that it is full of provisions designed to secure by licensing, by rationalisation and so forth the maximum of efficiency in the curing industry. It is true that the hon. Member claimed that we had not carried out the report of the Lane Fox Commission. If he will study the recommendations in the report, he will see that a very large number of them have been carried out.

He says that he believes the Government ought to say to the curers and everybody involved, "If you do not rationalise, we will take you by the scruff of the neck and make you." That, I believe, is the hon. Member's view. Adopting a similar attitude, the right hon. Gentleman the Member for Hillsborough (Mr. Alexander) wishes to deal with the pork trade and pork production, and take that under control. He may remember that that was considered by the Lane Fox Commission, where it stated: Any bacon policy must … seek to eliminate the influence of the 'pig and feed' cycle upon the production of bacon pigs. It would be desirable to discourage these maleficent influences also in the case of bacon imports and home pork production, but in the latter case elimination would probably be impossible without a stringency of regulation, extending over every phase of pig production, which we are anxious to avoid. That is where the right hon. Gentleman and ourselves part company. We think that, in the long run, it is fatal to impose upon an unwilling industry the immense amount of regulation and detail required in the reorganisation of the industry which the right hon. Gentleman and his friends would have no hesitation in imposing. I must remind the House that it is true that, if we lived under a dictatorship, and my right hon. Friend was the dictator, these things could be done and these regulations could be imposed regardless of the plight of the industry, but we do not so live. When I hear the right hon. Gentleman and his colleagues make these suggestions, sometimes I fear that the virus of totalitarianism is spreading through their ranks like a form of political foot-and-mouth disease. I think that I have made it clear to the House where we part company. However desirable it may be to take dictatorial methods and force these people to do what the right hon. Gentleman says we ought to do, we live in a State and under a system which makes that extremely difficult to do; and, difficult or not, we believe that it would be unwise to force these kinds of Measures upon an industry which would be unwilling to co-operate. While on the speech of the right hon. Gentleman the Member for Hillsborough, I would like to deal with the point which he raised on the question of the Financial Resolution. That Resolution should have appeared to-day. It will, in fact, be put upon the Paper to-morrow. The delay is due to the illness of the official concerned, and I am sure that the right hon. Gentleman will appreciate the position.

I now propose to deal with some of the questions raised by the hon. Member for Don Valley and other Members during the Debate. The hon. Member for Don Valley raised a question with regard to Scotland, and complained that there was no specific reference to Scotland in the Bill. There is no reason why there should be, for the marketing schemes which have been in operation have embraced Scotland. There is no different system in force or required, and, as far as I know, the Scottish producers and curers have been quite content with the existing arrangements. Clause 24 (6) (b) makes special provision for the case of what I believe is Ayrshire roll bacon, and is probably what the hon. Member had in mind when he raised that point.

Mr. Alexander

I understand that there is some feeling in Scotland because they are not certain that they will be able to get proper treatment for their part of the industry where they are accustomed to skin the pig and use the skin for industrial manufacture as distinct from the practice in England; and some of the people on the industrial side are pressing for a separate arrangement.

Mr. Ramsbotham

If it is possible to consider that matter when the appropriate stage arises, it certainly will be considered.

The hon. Member for Don Valley and other hon. Members raised the question of the small curer. The hon. Member for Don Valley and the right hon. Member for Hillsborough made a point about the possible danger of proceeding to such a length in that direction as to upset the working of the scheme. We do not anticipate such a possibility. As my right hon. Friend has informed the House, the actual production of these small curers, numbering more than 400, is not at present more than 5 per cent. of the total, and it must be borne in mind that no subsidy is payable to the small curer for his purchases on the open market. I think, therefore, that on the whole the apprehensions of the right hon. Gentleman are not likely to be realised.

The hon. Member for Don Valley asked me whether, if the figure in respect of feeding stuffs remained at 8s. 6d. and bacon prices went over 94s. 9d., the Government would make a profit. The answer is that that is possible. Even so, the producers will have had their standard price and the curers their standard margin, and they will have had security; but I do not think that in practice that will happen. Feeding stuffs at the present time are 10s. 4d. per cwt. as compared with the notional figure of 8s. 6d. in the Bill. It is true that the price may fall. If the price of feeding stuff falls, then many more pigs will be produced in this country and abroad, and there will be pressure to send bacon into this country, with the natural tendency to lower bacon prices. In practice, what the hon. Member suggests is unlikely. The recent rise in bacon prices was due to the fact that the high price of feeding stuffs has caused almost every country to slaughter their breeding stock, and that has made it difficult to fill their quotas.

Mr. T. Williams

The hon. Member admits that if the standard price of feeding stuffs came down to 8s. 6d. and the price of bacon exceeded 94s. 9d., the Government could make a profit. Since it is in the power of the Government under Clause 27 so to restrict imports as to maintain the price beyond 94s. 9d., is it such a doubtful possibility that the Government will make a profit?

Mr. Ramsbotham

It may be possible, but I doubt whether it will be so. The Government have far greater resources of making profit in other directions than the small profit that might result from this direction. The hon. Member for Don Valley asked me a poser. He asked me to explain Clause 24 (3). When he asked me to do that, it occurred to me that on this occasion I would sooner be introducing the Bill than winding up; but I wilt do my best to explain what Clause 24 (3) means. I suggest that the hon. Member should take out his note book. The formula is necessary because there are parts of the pig, such as the head, the trimmings and certain offals which are included in the dead weight of the pig, on which the producer is paid both the pig price and the subsidy on the parts of the carcase that are not made into bacon. That is the reason behind the Sub-section. There are different methods of curing. The Wiltshire curer turns as much of the carcase as he can into bacon. The percentage in the case of the Wiltshire curer is 80 per cent. of the carcase.

The Midland curer has a different practice. He still sells a portion of the carcase as fresh meat—pork. Let me make it clear to hon. Members how this Clause will work. If you take a 160 lb. carcase and consider the case of the Wiltshire curer, 80 per cent. of the carcase will go into bacon and the numerator in Subsection (3), that is 80 per cent. of the 160 lbs. of the carcase, is 128 lbs., but the denominator, in accordance with the last line on page 26, becomes four-fifths of the 160 lbs., and the result of that fraction is the figure 1. This figure 1 is 100 per cent. The Wiltshire curer under that calculation gets the full subsidy for his bacon. Now turn to the case of the Midland curer. That, I am sorry to say, is slightly more complicated. The numerator in his case, assuming the common practice of the Midland curer is to manufacture not 80 per cent. but 65 per cent., is 65 over 100 multiplied by 160, and that equals 104, and we get the same denominator as in the other case, namely, four-fifths of 160, which equals 128. The result of that fraction—I will give it now to save hon. Members the trouble of working it out—is 81¼ per cent. In the Midland case, if, for example, food and feeding stuffs are over 8s. 6d., the curer will pay the pig producer the 12s. 6d. figure plus the excess over 8s. 6d. at the rate laid down in the Bill—10.3d. per shilling. If food prices fall below the 8s. 6d. level he will recover from the producer the whole of the difference. But he will only receive from or pay to the Exchequer, as the case may be, 81¼ per cent. of the amount he pays or recovers. I am certain that has made the matter clear.

The hon. Member for Don Valley, who probably has now recovered from these calculations, made some reference to Denmark and the admirable position of the curing industry in Denmark. Far be it from me to criticise the curing industry in Denmark, but the hon. Member for South Bradford criticised the remarks of the hon. Member for Don Valley, and indeed from his remarks it was apparent that the Danish curers are suffering from precisely the same difficulties as we ourselves. I have a chart here showing the position for the past few years in Denmark. In the peak year, 1931, where prices were abnormally low, the Danish production reached 5,400,000 bacon pigs. To-day the Danish produc- tion has fallen to 3,400,000 pigs. That is, the Danes in those years have lost something like 2,000,000 pigs, because of the low prices and the high costs of feeding stuffs.

Mr. T. Williams

Is it not the case that the decline in their huge output was almost entirely due to the restriction of imports into this country, that in 1933 we restricted imports by 17 per cent. and in the following year by a further 16 per cent., and that their exports to this country last year were little more than 50 per cent. of what they were in 1933?

Mr. Ramsbotham

That may be so, but the decline was spread over the whole period; there was a decline last year, as well as in the year before. I notice from the figures which I have that between 1931 and 1934 there was a decline of about 300,000 breeding sows. It happens in every country that if there are low prices, the producers no longer keep their pig herds, but proceed to slaughter them. It is that state of affairs which we desire to prevent. I will give to the House the corresponding figures for our pig production during the same years. I have explained how Denmark lost about 2,000,000 pigs. In the peak figure of Danish production, 1931, our production was about 2,700,000 pigs. As the Danish figure declined, ours rose, and in 1936 it reached the figure of 3,803,000 pigs. I have not the exact figure, but I believe that last autumn our production reached the figure of 4,000,000 pigs. It is true that, as a consequence of the difficulties that then met the pig industry, production has declined, but there are signs that production has been stimulated by the expectations derived from this Bill, and is now on the upgrade again.

Mr. Alexander

With regard to the position in Denmark, we speak with the experience of running two of the most important abattoirs in that country. We have to deal with the Danish product. By the Government's decision we have been cut 50 per cent. in our output from our two Danish factories. We know why the Danes have killed their pigs, and it is no good the Minister telling us what he has told us.

Mr. Ramsbotham

I think pig cycles have been experienced not only in Denmark but here, and even supposing the right hon. Gentleman is right, is it not preferable that we should produce our own bacon rather than get bacon from other countries? The hon. Member for Don Valley and other hon. Members spoke about factory rationalisation, and said that they thought the time given to the factories was too long and that they might use various means of putting off rationalisation. I think it would be true to say that most of the factories are only too anxious to be rationalised. I understand that the Bacon Marketing Board is already at work on a scheme of rationalisation. The Bill contains various sanctions which can be put into operation if, for any reason, the Minister thinks that there is obstruction or undue delay. If imposed, the sanctions would be very much disliked by the curers, who, we hope, will rationalise their own factories. While not going into details about the sanctions, I can say that, broadly speaking, they remove from the curers the help and protection which the Bill gives them.

The hon. Member for South Bradford is, of course, the last hope of the stern, unbending Liberals of the middle of the nineteenth century. I have always regarded him as belonging to the independent wing of the Independent Liberal party. I am bound to observe, however, that if he was speaking to-night for his party, they will not find his speech very helpful among agricultural voters in the constituencies. He committed himself to the remark that he would not object so much to the Bill if there were greater production in the United Kingdom. I have already given figures showing the great increase in production which has taken place since 1931.

There is no new policy in this Bill. Its policy is based upon legislation which the House has passed in the last two or three years. It is based upon legislation with which hon. Gentlemen opposite very kindly presented us, and which it will continue, and there is no reason to suppose that the increase in production in Great Britain which has taken place between 1931 and 1936, will not continue. On the contrary, there is every reason why it should continue, and if I can show, as I have shown, that such an increase in production has taken place under the very arrangement which the hon. Member so strenuously dislikes, I hope that, on consideration, he will modify his opinion and will realise that there is, after all, something in rationalisa- tion. However, I despair of convincing the hon. Member because he belongs to a past age. The only thing I would say to him is this: Suppose a case in which there were some thousands of hon. Members for South Bradford each one capable of making, and inclined to make, the kind of excellent speech which the hon. Member makes, but with limited time and a limited audience. He would very soon set about rationalising that position.

He rightly raised a point in connection with fines or penalties. The House appreciates, I am sure, the reasons for imposing fines in some cases and for the reference to courts of summary jurisdiction in other cases, but I would remind the hon. Member and the House that this same point was raised in our Debate on the fishing industry, and my right hon. Friend the Minister of Agriculture told the House that he would consider the whole matter, not piecemeal but as a general proposition.

The hon. and gallant Baronet the Member for Maldon (Sir E. Ruggles-Brise) asked me certain questions. I am sure my right hon. Friend was glad to hear him say that the Bill would receive a general welcome. He went on to say, however, that the period of three years was, in his opinion, too short, not, I think, because of any difficulty in the way of breeding a pig in that time, but because of the capital expenditure involved in setting up pig-houses and so forth. I have seen a good many letters in agricultural papers from pig producers stating their intention of going straight ahead now, on the assumption that this Bill becomes law, with further equipment for pig production and I think, broadly speaking, the three-year period will be adequate to stimulate production as we all desire. My hon. and gallant Friend asked me also about the reaction of these proposals on the pork market, and this is a matter which was also raised by the right hon. Gentleman opposite. I would point out that under Clause 17 (2) the Minister has certain open market buying powers which will undoubtedly prevent the upsetting of the balance between the pork market and the bacon pig market. He also asked whether the cost of research would fall on the producers or the curers. The answer is that the necessary research programme will be paid for out of the common fund of the Development Board, contributions to which are payable under Clause 34 by both sections. I might also remind the House that in the case of the costs of factory rationalisation Clause 34 enables a special levy to be imposed upon the curers under that scheme, so that if the hon. Member possibly had in mind that the pig producer might have to pay for factory rationalisation, there is provision for avoiding that. The hon. Member asked whether the falling figures had any connection with the cost of factory rationalisation. The answer is "No." The descending scale of payments in the case of the pig producing industry is reasonable, because there is to be spent during the period a large sum of money on research and education, and it is to be supposed that the pig producer will get the advantage of that expenditure. Similarly, in the case of bacon, rationalisation each year may reasonably be expected to cheapen the producer's costs.

The hon. Member for East Ham, South (Mr. Barnes) made some criticism of the Bill, and I gather that he wanted rationalisation without quantitative regulation. I am still not clear whether the party opposite wish to abandon quantitative regulation or to maintain it, because in my own view, and in that of most hon. Members at any rate to-day it is impossible to achieve rationalisation without some quantitative regulation behind it. The hon. Member said that the Danes had been able to put a poorer quality on the market. I am not in a position to say of my own knowledge whether or not that is so—at least, I cannot be certain of it—but if it is so, I can only say that this Bill will provide an opportunity for a better quality to be put on the market.

The hon. Member for Lincoln (Mr. Liddall) raised the position of the small curer. If he will look at Clause 9 (3) (a) of the Bill, he will see that while the licence is in force, the position is that not more than 60 cwt. of bacon shall be produced in any four consecutive weeks on the premises to which the licence relates, and apart from that the only other condition is the condition that the premises shall be in a hygienic state. I think, therefore, my hon. Friend may be satisfied that there is adequate protection for the small curer.

Mr. Liddali

Will the Minister give me this assurance? If a general butcher, pork butcher, or provision dealer puts, say, a leg of pork into brine or, in other words, pickles it—if only for five minutes, in order to get the flavour that the public like, it is straight away called bacon under this Bill, and if you call it bacon, you will reduce that man's quota. Is that not so?

Mr. Ramsbotham

The hon. Member interrupted me when I was going on to deal with his second point, namely, that of the small butcher. He will find that in Clause 8 the small butcher's position is looked after, but I think my right hon. Friend has already said that he will make it clear that, as regards butchers, no licence will be needed, in which case the question of pickled pork will not arise.

Mr. Alexander

Would the hon. Gentleman make it quite clear? Is it not a fact that the Bacon Marketing Board have made an order under which all pickled pork will be exempted?

Mr. Ramsbotham

Small butchers are exempted under the existing scheme. The hon. Member for the Forest of Dean (Mr. Price) made a very helpful speech and told the House that this Bill made a very useful contribution to the industry, and for that my right hon. Friend is very grateful. As he adorned his speech, following my own bad example in the past, with a Latin quotation from the Georgics, I tan only reply to him by way of gratitude for his observations and say I hope that he will profit by this Bill for the regulation of the bacon industry, and I hope he will be noted, as Horace hoped he would be, as "Epicuri de grege porcum," which, being interpreted, means "a porker from the herd of Epicurus." An hon. Member said there was no mention of the domestic producer of pigs. If he will look at Clause 19 (5) (a) he will see that provision is there made for two or more registered producers employing the same agent, and that would enable small men to group together for the purposes he has in mind, with which indeed I entirely sympathise. Under the group contract the small man will get the subsidy. At the same time under another Clause—Clause 18 (1)—he can sell any pigs to a small curer, but in that case he will not get the subsidy. These provisions will allow ample room for the Society of Pig Keepers, the Land Settlement Organisation, the smallholders and indeed the farm labourers. I hope the hon. Member will be satisfied with that position.

An hon. Member raised the question of the small producer who wanted to extend his business and come into the scheme, and asked whether he would have any right of appeal in the future. That is a point which we shall have to consider. I cannot give an answer at the moment. The hon. Member for Newbury (Brigadier-General Brown) seemed to think that there was no adequate provision in this Bill for encouraging efficiency. I would remind him that first of all the quota provision which has existed in the past will still remain. Further there is the tapering provision. In general, the man who can produce at the lowest cost and produce the best pigs will make the most money. Similarly with regard to rationalisation, under this Bill the best factory will make the most money. One or two remarks have been made as regards the high prices which it is alleged this legislation has caused, and will cause. I am bound to say that that does not square with the views expressed by the Food Council. I would like to remind the House of a sentence or two in the report of the Food Council for 1936, where it is said that the arrangements under the marketing schemes and so forth have succeeded in so far as they have resulted in steadier prices and have thus lessened the danger that a sudden collapse in prices might involve producers an unexpected loss, or that a sudden rise might drive away consumers. They go on to say: From the great increase in pig production which has occurred since the beginning of the scheme it might be assumed that prices have been remunerative to producers, but when the basic contract prices under the scheme are compared with the prices assumed by the Lane-Fox Commission to represent the costs of production, they do not appear to have been excessive. From the consumer's point of view, the retail prices do not appear unreasonable. That is the considered judgment of the Food Council. Reference has been made to the pig cycle, a phenomenon described by the Lane Fox Commission as a curse to the pig producers. It is something that seems to occur every four years. It is in some ways not entirely inexplicable. Feeding stuffs prices appear to vary inversely to pig prices. When pig prices are high, the prices of feeding stuffs are low. When feeding stuffs become cheap, the farmers increase their production of pigs. There is then a time lag covering the period of production. When feeding stuffs prices during that period rise the farmer reverses his production policy, and so it goes on by cycles. We claim that this Bill seeks to and will do a great deal to avoid this curse to the pig producer, and enable us to build up

an industry in this country, both on the agricultural and on the industrial side, of which we can be justly proud.

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

The House divided: Ayes, 183; Noes, 126.

Division No. 171.]	AYES.	[11.0 p.m.
Acland-Troyte, Lt.-Col. G. J.	Furness, S. N.	Peaks, O.
Adams, S. V. T. (Leeds, W.)	Fyfe, D. P. M.	Petherick, M.
Anstruther-Gray, W. J.	Gluckstein, L. H.	Piekthorn, K. W. M.
Apsley, Lord	Greene, W. P. C. (Worcester)	Plugge, Capt. L. F.
Aske, Sir R. W.	Gridley, Sir A. B.	Procter, Major H. A.
Astor, Major Hon. J. J. (Dover)	Grigg, Sir E. W. M.	Radford, E. A.
Astor, Hon. W. W. (Fulham, E.)	Guest, Lieut.-Colonel H. (Drake)	Raikes, H. V. A. M.
Baillie, Sir A. W. M.	Guest, Hon. I. (Brecon and Radnor)	Ramsbotham, H.
Balfour, Capt. H. H. (Isle of Thanor)	Gunston, Capt. Sir D. W.	Ramsden, Sir E.
Balniel, Lord	Haskins, Rt. Hon. D. H.	Rathbone, J. R. (Bodmin)
Beamish, Rear-Admiral T. P. H.	Hannah, I. C.	Rayner, Major R. H.
Beechman, N. A.	Harbord, A.	Reid, W. Allan (Derby)
Beit, Sir A. L.	Haslam, Henry (Horncastle)	Reiner, J. R.
Bernays, R. H.	Haslam, Sir J. (Bolton)	Rickards, G. W. (Skipton)
Boothby, R. J. G.	Heilgers, Captain F. F. A.	Robinson, J. R. (Blackpool)
Bossom, A. C.	Hepburn, P. G. T. Buchan-	Ropnar, Colonel L.
Boulton, W. W.	Herbert, Major J. A. (Monmouth)	Ross Taylor, W. (Woodbridge)
Briscoe, Capt. R. G.	Hortbrugh, Florence	Rothschild, J. A. de
Broadbridge, Sir G. T.	Howitt, Dr. A. B.	Rowlands, G.
Brosklebank, Sir Edmund	Hudson, Capt. A. U. M. (Hack., N.)	Royds, Admiral Sir P. M. R.
Brown, Rt. Hon. E. (Leith)	Hume, Sir G. H.	Ruggles-Brise, Colonel Sir E. A.
Brown, Brig.-Gen. H. C. (Newbury)	Hunter, T.	Russell, Sir Alexander
Bull, B. B.	Hutchinson, G. C.	Russell, R. J. (Eddisbury)
Bullock, Capt. M.	James, Wing-Commander A. W. H.	Sanderson, Sir F. B.
Burgin, Rt. Hon. E. L.	Joel, D. J. B.	Scott, Lord William
Butcher, H. W.	Jones, L. (Swansea W.)	Selley, H. R.
Butler, R. A.	Keeling, E. H.	Shaw, Captain W. T. (Forfar)
Campbell, Sir E. T.	Kerr, Colonel C. I. (Montrose)	Shepperson, Sir E. W.
Carver, Major W. H.	Kerr, H. W. (Oldham)	Smiles, Lieut.-Colonel Sir W. D.
Castlereagh, Viscount	Kerr, J. Graham (Scottish Univs.)	Smith, Sir R. W. (Aberdeen)
Chamberlain, Rt. Hn. N. (Edgb't'n)	Latham, Sir P.	Somervell. Sir D. B. (Crewe)
Channon, H.	Leighton, Major B. E. P.	Spears, Brigadier-General E. L.
Christie, J. A.	Lennox-Boyd, A. T. L.	Spens. W. P.
Churchill, Rt. Hon. Winston S.	Levy, T.	Stanley, Rt. Hon. Lord (Fylde)
Clarke, Colonel R. S. (E. Grinstead)	Liddall, W. S.	Stewart, J. Henderson (Fife, E.)
Colman, N. C. D.	Lipson, D. L.	Storey, S.
Cook, Sir T. R. A. M. (Norfolk, N.)	Llewellin, Colonel J. J.	Strauss, H. G. (Norwich)
Cooper, Rt. Hn. T. M. (E'nburgh, W.)	Mabane, W. (Huddersfield)	Sueter, Rear-Admiral Sir M. F.
Craven-Ellis, W.	MacAndrew, Colonel Sir C. G.	Tasker, Sir R. I.
Crookshank, Capt. H. F. C.	MacDonald, Rt. Hon. M. (Ross)	Thomas, J. P. L.
Cross, R. H.	MacDonald, Sir Murdoch (Inverness)	Thomson, Sir J. D. W.
Cruddas, Col. B.	Macdonald, Capt. P. (Isis of Wight)	Titchfield, Marquess of
Davies, C. (Montgomery)	McEwen, Capt. J. H. F.	Tree, A. R. L. F.
Davies, Major Sir G. F. (Yeovil)	McKie, J. H.	Tryon, Major Rt. Hon. G. C.
Denman, Hon. R. D.	Magnay, T.	Tufnell, Lieut.-Commander R. L.
Duckworth, Arthur (Shrewsbury)	Maitland, A.	Ward, Lieut.-Col. Sir A. L. (Hull)
Duckworth, W. R. (Moss Side)	Makins, Brig.-Gen. E.	Ward, Irene M. B. (Wallsend)
Dugdale, Captain T. L.	Manningham-Buller, Sir M.	Wardlaw-Milne, Sir J. S.
Duggan, H. J.	Margesson, Capt. Rt. Hon. H. D. R.	Waterhouse, Captain C.
Duncan, J. A. L.	Markham, S. F.	Wayland, Sir W. A
Eastwood, J. F.	Mayhew, Lt.-Col. J.	Wedderburn, H. J. S.
Edmondson, Major Sir J.	Mitcheson, Sir G. G.	Wells, S. R.
Elliot, Rt. Hon. W. E.	Moore-Brabazon, Lt.-Col. J. T. C.	Whiteley, Major J. P. (Buckingham)
Elliston, Capt. G. S.	Morris-Jones, Sir Henry	Willoughby de Eresby, Lord
Elmley, Viscount	Morrison, G. A. (Scottish Univ's.)	Wilson, Lt.-Col. Sir A. T. (Hitchin)
Emery, J. F.	Morrison, Rt. Hon. W. S. (Cirencester)	Winterton, Rt. Hon. Earl
Emrys-Evans, P. V.	Munro, P.	Wise, A. R.
Erskine-Hill, A. G.	Nall, Sir J.	Womersley, Sir W. J.
Everard, W. L.	Neven-Spence, Major B. H. H.	Young, A. S. L. (Partick)
Findlay, Sir E.	Nicolson, Hon. H. G.
Fleming, E. L.	O'Neill, Rt. Hon. Sir Hugh	TELLERS FOR THE AYES.—
Fremantle, Sir F. E.	Patrick, C. M.	Captain Hope and Mr. Grimston.
NOES.
Acland, R. T. D. (Barnstaple)	Alexander, Rt. Hon. A. V. (H'lsbr.)	Attlee, Rt. Hon. C. R.
Adams, D. (Consett)	Ammon, C. G.	Banfield, J. W.
Adamson, W. M.	Anderson, F. (Whitehaven)	Barnes, A. J.
Barr, J.	Hardie, Agnes	Parkinson, J. A.
Bellenger, F. J.	Harris, Sir P. A.	Pearson, A.
Benn, Rt. Hon. W. W.	Harvey, T. E. (Eng. Univ's.)	Pethick-Lawrence, Rt. Hon. F. W.
Benson, G.	Hayday, A.	Price, M. P.
Broad, F. A.	Henderson, A. (Kingswinford)	Pritt, D. N.
Brown, Rt. Hon. J. (S. Ayrshire)	Henderson, J. (Ardwick)	Quibell, D. J. K
Burke, W. A.	Henderson, T. (Tradeston)	Rathbone, Eleanor (English Univ's.)
Cape, T.	Hills, A. (Pontefract)	Riley, B.
Charleton, H. C.	Holdsworth, H.	Ritson, J.
Chater, D.	Hollins, A.	Roberts, Rt. Hon. F. O. (W. Brom.)
Cluse, W. S.	Jagger, J.	Roberts, W. (Cumberland, N.)
Clynes, Rt. Hon. J. R.	Jenkins, Sir W. (Neath)	Robinson, W. A. (St. Helens)
Cocks, F. S.	John, W.	Salter, Dr. A. (Bermondsey)
Cripps, Hon. Sir Stafford	Jones, A. C. (Shipley)	Salter, Sir J. Arthur (Oxford U.)
Daggar, G.	Keliy, W. T.	Seely, Sir H. M.
Dalton, H.	Kennedy, Rt. Hon. T.	Sexton, T. M.
Davidson, J. J. (Maryhill)	Kirby, B. V.	Shinwell, E.
Davies, R. J. (Westhoughton)	Kirkwood, D.	Silkin, L.
Davies, S. O. (Merthyr)	Lathan, G.	Silverman, S. S.
Day, H.	Lawson, J. J.	Simpson, F. B.
Dunn, E. (Rother Valley)	Leach, W.	Smith, Ben (Rotherhithe)
Ede, J. C.	Lee, F.	Smith, E. (Stoke)
Edwards, Sir C. (Bedwellty)	Leslie, J. R.	Smith, T. (Normanton)
Fletcher, Lt.-Comdr. R. T. H.	Logan, D. G.	Sorensen, R. W.
Foot, D. M.	Lunn, W.	Stewart, W. J. (H'ght'n-le-Sp'ng)
Frankel, D.	Macdonald, G. Ince)	Thurtle, E.
Gallacher, W.	McEntee, V. La T.	Tinker, J. J.
Gardner, B. W.	MacLaren, A.	Tomlinson, G.
Garro Jones, G. M.	Maclean, N.	Viant, S. P.
Gibson, R. (Greenock)	Mainwaring, W. H.	Walkden, A. G.
Graham, D. M. (Hamilton)	Mander, G. le M.	Watson, W. McL.
Green, W. H. (Deptford)	Messer, F.	Wilkinson, Ellen
Grenfell, D. R.	Milner, Major J.	Williams, D. (Swansea, E.)
Griffith, F. Kingsley (M'ddl'sbro, W.)	Montague, F.	Williams, T. (Don Valley)
Griffiths, G. A. (Hemsworth)	Muff, G.	Wilson, C. H. (Attercliffe)
Griffiths, J. (Llanelly)	Nathan, Colonel H. L.	Windsor, W. (Hull, C.)
Groves, T. E.	Naylor, T. E.	Young, Sir R. (Newton)
Guest, Dr. L. H. (Islington, N.)	Oliver, G. H.
Hall, G. H. (Aberdare)	Paling, W.	TELLERS FOR THE NOES.—
Hall, J. H. (Whitechapel)	Parker, J.	Mr. Whiteley and Mr. Mathers.

Bill read a Second time, and committed to a Standing Committee.

The remaining Orders were read, and postponed.